RMR Group facilitates $1 billion refinancing of Vertex headquarters

The RMR Group (NASDAQ: RMR) announced it facilitated a $1 billion five-year, interest-only fixed rate mortgage financing for Vertex Pharmaceuticals' headquarters in Boston's Seaport district. The financing carries a weighted-average interest rate of 5.5957% and is secured by the 1.1 million square foot property at 50 Northern Avenue and 11 Fan Pier Boulevard.

The financing proceeds will primarily repay an existing $620 million fixed rate mortgage with an anticipated 2026 repayment date, fund leasing reserves, and repatriate cash. Vertex recently extended its lease for approximately 15 years, with the new lease expiring in June 2044.

"RMR is pleased to have facilitated this refinancing for our private capital clients following a long-term lease extension by the anchor tenant," said Adam Portnoy, President and Chief Executive Officer of RMR. "This financing allows us to recapitalize the joint venture's debt at a leverage level appropriate for a well leased, high quality asset, while capitalizing outstanding tenant inducements associated with the lease extension, and securing a competitive fixed interest rate."

The properties are owned by a joint venture managed by RMR, with primary owners being private institutional investors. Diversified Healthcare Trust (NASDAQ: DHC), an RMR client, holds a 10% equity interest in the venture.

Morgan Stanley Bank, Bank of Montreal, Goldman Sachs and J.P. Morgan provided the financing, with Dechert LLP representing the lenders. Skadden, Arps, Slate, Meagher & Flom LLP served as legal counsel to the borrower.

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