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Indebtedness
 12 Months Ended
Dec. 31, 2024
Debt Disclosure [Abstract]  
Indebtedness Indebtedness
As of December 31, 2024 and 2023, our outstanding indebtedness consisted of the following:
 December 31,
20242023
Unsecured revolving credit facility, due in 2024$— $205,000 
Secured revolving credit facility, due in 2027325,000 — 
Secured term loan, due in 2027100,000 — 
Senior unsecured notes, 4.250% interest rate, due in 2024 (1)
— 350,000 
Senior unsecured notes, 4.500% interest rate, due in 2025 (2)
171,586 650,000 
Senior unsecured notes, 2.650% interest rate, due in 2026
140,488 300,000 
Senior unsecured notes, 2.400% interest rate, due in 2027
80,784 350,000 
Senior secured notes, 3.250% interest rate, due in 2027 (3)
444,992 — 
Mortgage note payable, 8.272% interest rate, due in 2028
42,700 42,700 
Mortgage note payable, 8.139% interest rate, due in 2028
26,340 26,340 
Mortgage note payable, 7.671% interest rate, due in 2028
54,300 54,300 
Senior secured notes, 9.000% interest rate, due in March 2029 (4)
300,000 — 
Senior secured notes, 9.000% interest rate, due in September 2029 (5)
609,999 — 
Senior unsecured notes, 3.450% interest rate, due in 2031
114,355 400,000 
Mortgage note payable, 7.210% interest rate, due in 2033
30,680 30,680 
Mortgage note payable, 7.305% interest rate, due in 2033
8,400 8,400 
Mortgage note payable, 7.717% interest rate, due in 2033
14,900 14,900 
Senior unsecured notes, 6.375% interest rate, due in 2050
162,000 162,000 
2,626,524 2,594,320 
Unamortized debt premiums, discounts and issuance costs(91,890)(21,711)
$2,534,634 $2,572,609 
(1)These senior notes were redeemed in March 2024.
(2)Certain of these senior notes were redeemed through a series of exchange transactions during the year ended December 31, 2024. The remaining balance of $171,586 at December 31, 2024 was redeemed in cash in January 2025.
(3)These senior notes were issued in December 2024.
(4)These senior notes were issued in February 2024.
(5)These senior notes were issued in June and October 2024.
In January 2024, we entered into an amended and restated credit agreement, or our credit agreement, governing a new $325,000 secured revolving credit facility and a $100,000 secured term loan. Our credit agreement replaced our prior revolving credit facility, which had a maturity date of January 31, 2024. As collateral for all loans and other obligations under our credit agreement, certain of our subsidiaries pledged all of their respective equity interests in certain of our direct and indirect property owning subsidiaries, and our pledged subsidiaries provided first mortgage liens on 19 properties that had a gross book value of real estate assets of $1,030,889 as of December 31, 2024. We can borrow, repay and reborrow funds available under our revolving credit facility until maturity, and no principal repayments on borrowings under our credit agreement are due until maturity. The maturity date of our credit agreement is January 29, 2027 and, subject to the payment of an extension fee and meeting certain other requirements, we can extend the stated maturity date of our revolving credit facility by one year. Our credit agreement contains a number of covenants, including covenants that require us to maintain certain financial ratios, restrict our ability to incur additional debt in excess of calculated amounts and, subject to limited exceptions, restrict our ability to increase our distribution rate above the current level of $0.01 per common share per quarter and enter into share repurchases. Availability of borrowings under our credit agreement is subject to ongoing minimum performance and market values of the 19 collateral properties, our satisfying certain financial covenants and other credit facility conditions.
Interest payable on borrowings under our credit agreement is at a rate of the secured overnight financing rate, or SOFR, plus a margin of 350 basis points. We are also required to pay an unused facility fee on the amount of total lending commitments, which was 25 basis points per annum at December 31, 2024. As of December 31, 2024, we were fully drawn on our $325,000 revolving credit facility and $100,000 was outstanding under our term loan.
As of December 31, 2024, the annual interest rate payable on borrowings under our credit agreement was 7.9%. The weighted average annual interest rate for borrowings under our credit agreement for the year ended December 31, 2024 was 8.7%.
Under our prior revolving credit facility, we were required to pay interest at a rate of SOFR plus a premium, which was 145 basis points per annum at December 31, 2023, on the amount outstanding under our prior revolving credit facility, as well as a facility fee on the total amount of lending commitments, which was 30 basis points per annum at December 31, 2023. As of December 31, 2023, the annual interest rate payable on borrowings under our prior revolving credit facility was 6.9%. The weighted average annual interest rate for borrowings under our prior revolving credit facility for the year ended December 31, 2023 was 6.5%.
Our revolving credit facility is governed by a credit agreement with a syndicate of institutional lenders. Our credit agreement and senior notes indentures and their supplements provide for acceleration of payment of all amounts due thereunder upon the occurrence and continuation of certain events of default, such as, in the case of our credit agreement, a change of control of us, which includes RMR, ceasing to act as our business and property manager. Our credit agreement and senior notes indentures and their supplements also contain covenants, including covenants that restrict our ability to incur debts, require us to comply with certain financial covenants and, in the case of our credit agreement, restrict our ability to increase our distribution rate above the current level of $0.01 per common share per quarter. We believe we were in compliance with the terms and conditions of the respective covenants under our credit agreement and senior notes indentures and their supplements at December 31, 2024.
Senior Secured Notes Issuance
In February 2024, we issued $300,000 in aggregate principal amount of 9.000% senior secured notes due March 2029, or the March 2029 Notes. The aggregate net proceeds from the offering of the March 2029 Notes were $270,712, after initial purchaser discounts and other offering expenses. The March 2029 Notes are fully and unconditionally guaranteed on a joint, several and senior secured basis by certain of our subsidiaries and secured by a pledge of all of the respective equity interests of the subsidiary guarantors and first mortgage liens on 17 properties with a gross book value of real estate assets of $621,506 as of December 31, 2024. The March 2029 Notes require semi-annual payments of interest only and are prepayable, at par plus accrued interest, after March 31, 2028.
Senior Unsecured Notes Redemption
In March 2024, we redeemed, at par plus accrued interest, all $350,000 of our 4.25% senior unsecured notes due 2024. As a result of this redemption, we recorded a loss on early extinguishment of debt of $425 during the year ended December 31, 2024, which represented the unamortized discounts related to these notes.
Senior Notes Exchanges
In June and October 2024, through two exchange transactions, we exchanged $609,999 in aggregate principal amount of new 9.000% senior secured notes due September 2029, or the September 2029 Notes, for an aggregate $895,373 of certain of our outstanding senior unsecured notes, or the Existing Notes, and an aggregate 1,406,952 of our common shares valued at $2.26 per share, and such transactions, the 2029 Senior Note Exchanges, as follows:
Existing Notes ExchangedAggregate Principal Amount of Existing Notes Accepted for Exchange
Aggregate Principal Amount of September 2029 Notes Delivered
Existing 4.50% 2025 Notes
$181,000 $183,981 
Existing 2.650% 2026 Notes
159,512 114,803 
Existing 2.400% 2027 Notes
269,216 164,162 
Existing 3.450% 2031 Notes
285,645 147,053 
Total$895,373 $609,999 
The September 2029 Notes are fully and unconditionally guaranteed on a joint, several and senior secured basis by certain of our subsidiaries and are secured by first mortgage liens on 19 properties with a gross book value of real estate assets of $721,375 as of December 31, 2024 and second mortgage liens on the 19 properties securing our credit agreement. The September 2029 Notes require semi-annual payments of interest only and are prepayable, at par plus accrued interest, after June 3, 2028. During the year ended December 31, 2024, we recorded a net gain on early extinguishment of debt of $212,735 as a result of the 2029 Senior Note Exchanges.
In December 2024, through an exchange transaction, we exchanged $444,992 of new 3.250% senior secured notes due March 2027, or the March 2027 Notes, 11,532,794 of our common shares valued at $1.37 per share and cash premiums of $25,000 for $281,514 of 4.500% senior unsecured notes due 2025, or the 2025 Notes, and $58,486 in cash from certain existing noteholders. This transaction is referred to herein as the 2027 Senior Note Exchange. The March 2027 Notes require quarterly payments of interest and quarterly principal amortization payments of $6,500, and on or before March 1, 2026, require a mandatory principal payment of $125,000, which is subject to reduction for certain prior redemptions of the March 2027 Notes. The March 2027 Notes are fully and unconditionally guaranteed on a joint, several and senior secured basis by certain of our subsidiaries and are secured by first mortgage liens on 37 properties with a gross book value of real estate assets of $1,279,487 as of December 31, 2024 and second mortgage liens on the 19 properties securing the September 2029 Notes and they are fully and unconditionally guaranteed, on a joint, secured and senior unsecured basis by certain of our other subsidiaries. During the year ended December 31, 2024, we recorded a loss on early extinguishment of debt of $87,064 as a result of the 2027 Senior Note Exchange. We redeemed, at par plus accrued interest, the remaining $171,586 of the 2025 Notes in January 2025.
During the year ended December 31, 2024, in a series of exchange transactions, we exchanged $15,900 in aggregate principal amount of the 2025 Notes for an aggregate amount of 7,565,722 of our common shares at a weighted average price of $2.07 per share. During the year ended December 31, 2024, we recorded a gain on early extinguishment of debt of $939 as a result of these exchanges.
The gains we realized on early extinguishment of debt are considered cancellation of debt income, or CODI, for income tax purposes and part of our REIT taxable income. We do not expect that any special distribution will be required to maintain our qualification for taxation as a REIT as a result of generating CODI in 2024 as a result of offsetting losses from the sale of real estate and other tax strategies.
On February 7, 2025, we commenced a series of exchange offers, or the Exchange Offers, pursuant to which we are offering to issue up to $175,000 in aggregate principal amount of new 8.000% senior guaranteed unsecured notes due 2030, or the New 2030 Notes, and related guarantees in exchange for our outstanding (i) 2.650% senior unsecured notes due 2026, (ii) 2.400% senior unsecured notes due 2027 and (iii) 3.450% senior unsecured notes due 2031. The Exchange Offers are being made subject to the terms and conditions set forth in an offering memorandum dated as of February 7, 2025.
As of December 31, 2024, seven of our properties with an aggregate gross book value of real estate assets of $304,673 were encumbered by mortgage notes with an aggregate principal amount of $177,320. Our mortgage notes are non-recourse, subject to certain limited exceptions and do not contain any material financial covenants.
The required principal payments due during the next five years and thereafter under all our outstanding consolidated debt as of December 31, 2024 were as follows:
YearPrincipal Payment
2025 (1)
$197,586 
2026291,488 
2027773,776 
2028123,487 
2029910,278 
Thereafter329,909 
Total (2)
$2,626,524 
(1)Includes $171,586 aggregate principal of the 2025 Notes, which were redeemed in full in January 2025.
(2)Total consolidated debt outstanding as of December 31, 2024, net of unamortized premiums, discounts and issuance costs totaling $91,890, was $2,534,634.
None of our unsecured debt obligations require principal or sinking fund payments prior to their maturity dates.