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Elme Communities secured $520M in financing following the closing of a property sale to Cortland, a major step toward the company's planned dissolution.
Cortland paid $1.6B in cash for 19 multifamily properties. Elme, formerly known as WashREIT, also entered a loan agreement with Goldman Sachs for a senior secured-term loan of $520M.
The loan had been contingent on the Cortland sale closing and now has a Nov. 9, 2026, maturity date, with the option to extend for one year.
The REIT intends to repay the loan with the net proceeds from sales of the remaining properties securing the term loan, it said in a statement.
Elme said it plans to use an "initial special liquidating distribution" to pay shareholders between $14.50 and $14.82 per common share in net proceeds from the portfolio sale and a portion of the proceeds from the new term loan.
The REIT said in August that it anticipated shareholders would receive $14.68 to $15 per share for the sale to Cortland and $2.90 to $3.50 per share for the sale of the rest of the assets.
Elme launched the sale of the nine remaining apartment assets and one office building in its portfolio in the third quarter and aims to complete the sale of all those properties by June 2026, it announced Thursday.
"Our goal remains to sell all of Elme’s assets as soon as practicable to accelerate the return of capital to shareholders," Elme CEO Paul McDermott said in a statement.
Of the properties Cortland bought, 16 are in the greater Washington, D.C., area, and three are in Metro Atlanta.
The sale to Cortland was announced in August as part of Elme's overall plan to wind down operations following a February earnings call on which the REIT said it was beginning a review of strategic alternatives.
The company said it was exploring alternatives because the market wasn’t allowing the company to lower capital costs in a way that "supports accretive growth."
CORRECTION, MAY 11, 1:07 P.M. ET: This story has been updated to correct the number of properties in the portfolio.
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