Sun Communities, Inc. announced on April 30, 2025, the completion of the initial closing of its sale of Safe Harbor Marinas to an affiliate of Blackstone Infrastructure. The initial closing generated approximately $5.25 billion in pre-tax cash proceeds, net of transaction-related costs.
The company intends to use these proceeds to repay approximately $3.3 billion of debt, inclusive of estimated prepayment costs. This includes $1.6 billion outstanding under its senior credit facility, $740 million of secured mortgage debt with a weighted average annual interest rate of 5.3%, and the planned redemption of $950 million in unsecured senior notes with a weighted average coupon of 5.6% on May 10, 2025.
These debt repayments are expected to generate annualized interest expense savings of approximately $160 million and reduce the weighted average interest rate on Sun's outstanding indebtedness to approximately 3.5%. The company aims to manage its balance sheet with a long-term leverage target of approximately 3.5x to 4.5x net debt-to-EBITDA.
In addition to debt reduction, Sun Communities allocated approximately $1.0 billion into 1031 exchange escrow accounts to fund potential future Manufactured Housing (MH) and Annual Recreational Vehicle (RV) acquisitions on a tax-efficient basis. The Board of Directors also authorized a stock repurchase program of up to $1.0 billion of the company's outstanding common stock.
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