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Service Properties Trust Prices $610.2 Million Asset-backed Securitization at 5.60% That Matures in February 2028

Non-Recourse Notes are Secured by 308 Net Lease Retail Properties

Announces Early Redemption of $500 Million 4.50% Senior Notes Due June 2023

Service Properties Trust (Nasdaq: SVC) today announced that its subsidiary, SVC ABS LLC, has priced $610.2 million in principal amount of net lease mortgage notes in a transaction exempt from registration from the Securities Act of 1933, as amended, or the Securities Act, and sold to Qualified Institutional Buyers as defined in Rule 144A under the Securities Act and in offshore transactions to non-U.S. persons outside the U.S. in accordance with Regulation S under the Securities Act. This transaction is expected to close on February 10, 2023, subject to the satisfaction of customary closing conditions. The notes will be issued in three classes to institutional buyers in the following principal amounts, and are expected to be rated by Standard & Poor’s Ratings Services as follows:

  • Class A: $305.0 million of 5.15% of AAA rated notes
  • Class B: $173.0 million of 5.55% of AA rated notes
  • Class C: $132.2 million of 6.70% of A rated notes

The weighted average coupon of the three classes is 5.60%. The Class A and Class B notes will require monthly principal repayments at an annualized rate of 0.50% and 0.25% of the balance outstanding, respectively, and the Class C notes will require interest payments only. The notes are expected to mature in February 2028 and SVC may redeem the notes at par beginning in February 2026. The notes are non-recourse and are secured by the assets of SVC ABS LLC, which include 308 net lease retail properties with annual minimum rents of $65.3 million and an appraised value of approximately $1.0 billion. The net proceeds from this transaction, after initial purchaser discounts and offering costs, are expected to be approximately $560.0 million and will be used for the repayment of outstanding debt and general corporate purposes.

SVC has also announced the early redemption of its outstanding 4.50% Senior Notes due June 2023 at a redemption price equal to the principal amount of $500.0 million, plus accrued and unpaid interest to, but excluding the date of redemption. The redemption price is expected to be paid on or about March 8, 2023. SVC currently expects to fund this redemption with the proceeds from the net lease mortgage notes transaction.

Brian Donley, Chief Financial Officer of SVC, made the following statement regarding today’s announcement:

“We are pleased with this financing for SVC which will be used to refinance our $500.0 million senior notes coming due this June. We are especially pleased with the terms of this financing given the general increase in market interest rates during the last year and in comparison to the implied trading yields on our currently outstanding unsecured senior notes. We also think this financing demonstrates to the market that SVC has multiple options available to it for refinancing maturing debt in the future.”

This announcement is for information purposes only and does not constitute or form any part of an offer to sell or the solicitation of an offer to acquire, purchase or subscribe for securities, nor shall there be any sale of the securities described above in any jurisdiction in which their offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of such state or jurisdiction. The net lease mortgage notes will not be registered under the Securities Act or any state securities laws and, unless so registered, may not be offered or sold in the United States except pursuant to an applicable exemption from the registration requirements of the Securities Act and applicable state securities laws.

About Service Properties Trust

Service Properties Trust (Nasdaq: SVC) is a real estate investment trust, or REIT, with over $11 billion invested in two asset categories: hotels and service-focused retail net lease properties. As of September 30, 2022, SVC owned 242 hotels with over 40,000 guest rooms throughout the United States and in Puerto Rico and Canada, the majority of which are extended stay and select service. As of September 30, 2022, SVC also owned 769 retail service-focused net lease properties totaling over 13.4 million square feet throughout United States. SVC is managed by The RMR Group (Nasdaq: RMR), an alternative asset management company with over $37 billion in assets under management as of September 30, 2022 and more than 35 years of institutional experience in buying, selling, financing and operating commercial real estate. SVC is headquartered in Newton, MA. For more information, visit


This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other securities laws. These forward-looking statements are based upon SVC’s present intent, beliefs and expectations, but these statements and the implications of these statements are not guaranteed to occur and may not occur for various reasons, some of which are beyond SVC’s control. For example:

  • This press release states that the net lease mortgage notes transaction is expected to close on February 10, 2023. The closing of this transaction is subject to various conditions and contingencies as are customary in note purchase agreements in the United States. If these conditions are not satisfied or the specified contingencies do not occur, this transaction may not close.
  • SVC’s current intent to use the net proceeds from net lease mortgage notes transaction to redeem its outstanding 4.500% Senior Notes due June 2023 is dependent on the closing of the transaction and may not occur.
  • Mr. Donley states in this press release that the net lease mortgage notes transaction demonstrates to the market that SVC has multiple options available to it for refinancing maturing debt in the future. However, SVC’s ability to refinance maturing debt and the cost of any such refinancing will be subject to market conditions, SVC’s financial condition and operating performance and its credit ratings.

The information contained in SVC’s filings with the Securities and Exchange Commission, including under the caption “Risk Factors” in SVC’s periodic reports, or incorporated therein, identifies other important factors that could cause differences from SVC’s forward-looking statements. SVC’s filings with the SEC are available on the SEC’s website at

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

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


Stephen Colbert, Director, Investor Relations

(617) 796-8232

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