Diversified Healthcare Trust Provides Business Update

Key Terms

zero coupon bonds financial

Zero-coupon bonds are debt securities sold at a deep discount that pay no periodic interest; instead they mature at face (par) value, so an investor’s return is the difference between the purchase price and the amount received at maturity. They matter to investors because they provide a predictable lump-sum payoff—useful for meeting a future expense—while being highly sensitive to interest-rate changes, which can magnify gains or losses and affect tax and portfolio planning.

senior secured notes financial

Senior secured notes are loans a company sells to investors that are backed by specific assets and given first priority for repayment if the company defaults. Because they have a claim on collateral and are paid before other debts, they usually offer lower risk and correspondingly lower interest than unsecured debt; investors use them to judge how safe repayment and recovery of principal might be, like holding a mortgage instead of an unsecured credit card balance.

revolving credit facility financial

A revolving credit facility is a type of loan that a business can borrow from whenever it needs money, up to a set limit. It’s like having a credit card for companies—allowing them to borrow, pay back, and borrow again as needed, providing flexibility for managing cash flow or funding short-term expenses.

capital recycling program financial

A capital recycling program is a strategy where a company sells certain assets or investments to raise cash and then uses that money to invest in new projects or opportunities. For investors, it signals that the company is actively managing its resources to grow or improve its business, which can impact its future profitability and value.

Completes $605 Million of Non-Core Property Sales in 2025

Announces Full Repayment of 2026 Zero Coupon Bonds

Completes Transition of SHOP Portfolio to New Operators

NEWTON, Mass.--(BUSINESS WIRE)-- Diversified Healthcare Trust (Nasdaq: DHC) (“DHC”) today provided a business update regarding its capital recycling program, the full repayment of its 2026 zero coupon bonds and the transition of operations of its senior housing operating portfolio (“SHOP”) communities from AlerisLife Inc. to new operators.

Property Sales Update

DHC continues to advance its previously disclosed capital recycling program focused on the sale of non-core properties. During the fourth quarter of 2025, DHC completed the sale of 37 properties for gross proceeds of approximately $250 million. Including these transactions, DHC completed the sale of 69 properties for gross proceeds of approximately $605 million during 2025. In addition, as of January 5, 2026, DHC is under agreement to sell 13 SHOP communities for expected gross proceeds of approximately $26 million. These sales are expected to close during the first quarter of 2026, subject to the satisfaction of customary closing conditions.

Full Repayment of 2026 Zero Coupon Bonds

DHC also announced its repayment in full of its zero coupon senior secured notes due 2026 on December 29, 2025, using cash on hand and proceeds from asset sales. This repayment addressed DHC’s significant near-term debt maturity, further strengthening its balance sheet and releasing 45 collateral properties, representing approximately $850 million in gross book value, and enhancing DHC’s financial flexibility. DHC now has no debt maturing until 2028.

SHOP Operator Transitions Update

DHC has completed the previously announced transition of its 116 SHOP communities managed by AlerisLife Inc. to new operators, with all 116 communities transitioned as of December 31, 2025.

Chris Bilotto, President and Chief Executive Officer of DHC, made the following statement:

“Looking back over the past year, we are pleased to have successfully executed on our stated strategies, including capital recycling initiatives and balance sheet optimization, in addition to portfolio enhancements with operator transitions across our senior housing operating portfolio. As we enter 2026, DHC has no debt maturities until 2028 and full availability under its revolving credit facility. We believe that this provides a multi-year runway to focus on driving operational performance and pursuing disciplined capital allocation, while continuing to drive long-term value for shareholders.”

About Diversified Healthcare Trust

DHC is a real estate investment trust focused on owning high-quality healthcare properties located throughout the United States. DHC seeks diversification across the health services spectrum by care delivery and practice type, by scientific research disciplines and by property type and location. As of September 30, 2025, DHC’s approximately $6.7 billion portfolio included 335 properties in 34 states and Washington, D.C., with more than 26,000 senior living units, approximately 6.9 million square feet of medical office and life science properties and occupied by approximately 420 tenants. DHC is managed by The RMR Group (Nasdaq: RMR), a leading U.S. alternative asset management company with approximately $39 billion in assets under management as of September 30, 2025 and more than 35 years of institutional experience in buying, selling, financing and operating commercial real estate. DHC is headquartered in Newton, MA.

WARNING CONCERNING FORWARD-LOOKING STATEMENTS

This press release contains statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other securities laws. Also, whenever DHC uses words such as “believe”, “expect”, “anticipate”, “seek”, “intend”, “plan”, “estimate”, “will”, “may” and negatives or derivatives of these or similar expressions, DHC is making forward-looking statements. These forward-looking statements are based upon DHC’s present intent, beliefs or expectations, but forward-looking statements are not guaranteed to occur and may not occur. For example:

• This press release includes statements regarding DHC’s expectations with respect to asset sales under agreement, including the timing and completion of such transactions. These transactions are subject to closing conditions, including lender and regulatory approvals, and may not be completed on the contemplated terms or timeline or at all.
• This press release includes statements regarding the expected benefits of DHC’s capital recycling initiatives, balance sheet actions and SHOP community operator transitions, including improvements to liquidity, balance sheet profile and operating performance. However, these actions may not result in the anticipated benefits or drive long-term value for shareholders, and DHC may incur losses or additional costs in connection with these actions.

Actual results may differ materially from those contained in or implied by DHC’s forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and other factors, some of which are beyond DHC’s control.

The information contained in DHC’s filings with the Securities and Exchange Commission (the “SEC”), including under “Risk Factors” in DHC’s periodic reports, or incorporated therein, identifies other important factors that could cause DHC’s actual results to differ materially from those stated in or implied by DHC’s forward-looking statements. DHC’s filings with the SEC are available on the SEC’s website at www.sec.gov.

You should not place undue reliance upon forward-looking statements.

Except as required by law, DHC does not intend to update or change any forward-looking statements as a result of new information, future events or otherwise.‎

A Maryland Real Estate Investment Trust with transferable shares of beneficial interest listed on the Nasdaq.
No shareholder, Trustee or officer is personally liable for any act or obligation of the Trust.

View source version on businesswire.com: https://www.businesswire.com/news/home/20260102424934/en/

Bryan Maher, Senior Vice President

(617) 796-8234

Source: Diversified Healthcare Trust