v3.26.1
Debt
 6 Months Ended
Jun. 30, 2026
Debt Disclosure [Abstract]  
Debt Debt
Long-term debt balances, including associated interest rates and maturities consists of the following (in thousands):
Weighted average
interest rate		June 30,
2026		December 31,
2025
Maturity DateJune 30,
2026		December 31, 2025
Revolving credit facility20305.7%6.6%$258,000 $95,050 
Fixed rate mortgage notes payable
2026 to 2045
4.6%4.6%374,352 384,764 
Variable rate mortgage notes payable (1)
2026 to 2029
5.7%5.9%64,153 67,611 
Ally term loan (1)
20286.3%6.5%122,000 122,000 
Term loan facilities (1)
2029 to 2031
5.7%N/A575,000 — 
Bridge facility (2)
20275.9%N/A170,000 — 
Notes payable - consolidated VIE
2026 to 2027
6.4%6.6%19,933 21,690 
Notes payable - insurance
2026
N/A5.6%— 2,004 
Total debt1,583,438 693,119 
Deferred loan costs, net11,886 3,378 
Total debt, net of deferred loan costs1,571,552 689,741 
Current portion of debt16,138 7,291 
Long-term debt, net$1,555,414 $682,450 
(1) See “Note 15–Fair Value Measurements” for interest rate cap and interest rate swap agreements on variable rate mortgage notes payable.
(2) Subsequent to June 30, 2026, the Company repaid the Bridge Facility with new financing and reclassified the Bridge Facility to long-term debt, net. See “Note 18–Subsequent Events.”

The following schedule summarizes our debt payable as of June 30, 2026 (in thousands):
Principal payments due in:
2026$4,471 
2027195,917 
2028134,175 
2029682,999 
2030258,095 
Thereafter307,781 
Total debt, excluding deferred loan costs$1,583,438 

As of June 30, 2026, our fixed rate mortgage notes bore interest rates ranging from 3.0% to 6.3%. Our variable rate mortgage notes and revolving credit facility are based on SOFR plus an applicable margin. As of June 30, 2026, the one-month SOFR was 3.7% and the applicable margins ranged from 1.0% to 2.7%.
As of June 30, 2026, we had property and equipment with a net carrying value of $544.1 million that was secured by outstanding notes payable. In addition, as of June 30, 2026, we had property and equipment with a net carrying value of $1,615.1 million secured by the revolving credit facility, term loan facility and bridge facility.
Debt Financing of the CHP Merger
In order to fund a portion of the cash consideration required for the CHP Merger, the Company obtained permanent debt financing of $930.0 million, with an accordion feature that allows Sonida to increase the facilities up to $1.25 billion. On December 29, 2025, the Company amended and restated its revolving credit facility and on March 5, 2026 increased the borrowing amount (collectively, the “A&R Credit Agreement”), which amendments were subject to and conditioned upon the consummation of the CHP Merger. The A&R Credit Agreement increased the available commitments under the revolving credit facility to $405.0 million, extended the maturity thereof to March 10, 2030, reduced the leverage-based pricing matrix to between SOFR plus 1.35% margin and SOFR plus 2.00% margin, expanded the participating lenders, and effected certain other
changes (the “Revolving Credit Facility”). In addition, the Company incurred $525.0 million in permanent term loans under the A&R Credit Agreement in two equal tranches (the “Term Loan Facility”) to fund a portion of the cash consideration necessary for the CHP Merger. The Term Loan Facility is comprised of a three-year tranche that matures March 10, 2029 and a five-year tranche that matures March 10, 2031. The Term Loan Facility is subject to a leverage-based pricing matrix between SOFR plus 1.30% margin and SOFR plus 1.95% margin, and is otherwise subject to the same guarantees and security provisions, events of default, corporate covenants and borrowing base availability requirements of the Revolving Credit Facility. The Company entered into a SOFR-based interest rate cap (“IRC”) to reduce exposure to the variable interest rate fluctuations associated with the three-year tranche Term Loan Facility. The IRC has a total cost of $0.6 million, an aggregate notional amount of $262.5 million, a 36-month term and a cap rate of 4.50%. The Company entered into a SOFR-based interest rate swap (“IR Swap”) to reduce the exposure to the variable interest rate fluctuations associated with the five-year tranche Term Loan Facility. The IR Swap has an aggregate notional amount of $287.5 million, a 57-month term and is structured as a floating to fixed swap with a fixed rate of 4.105%. Upon consummation of the CHP Merger, the $150.0 million revolving credit facility was replaced with a new $405.0 million revolving credit facility under the A&R Credit Agreement, which was subsequently increased to $455.0 million.
On March 10, 2026, in order to fund the remaining portion of the cash consideration required for the CHP Merger, the Company incurred $270.0 million in loans under a 364-day senior secured bridge facility (the “Bridge Facility”), which has been reduced to $170.0 million as of June 30, 2026. The Bridge Facility matures on March 9, 2027 and is subject to a leverage-based pricing matrix between SOFR plus 1.35% margin and SOFR plus 2.00% margin. No principal payments for the Bridge Facility are due until maturity. The Bridge Facility is subject to the same guarantees and security provisions, events of default, corporate covenants and borrowing base availability requirements as the A&R Credit Agreement.
On March 30, 2026, the Company incurred an additional $25.0 million in permanent term loans under the Term Loan Facility, and on March 31, 2026, incurred an additional $25.0 million on the Revolving Credit Facility and used those proceeds to repay $50.0 million of loans outstanding under the Bridge Facility.
On May 7, 2026, the Company incurred an additional $25.0 million in permanent term loans under the Term Loan Facility, and an additional $25.0 million on the Revolving Credit Facility used those proceeds to repay the $50.0 million of loans outstanding under the Bridge Facility.
As of June 30, 2026, the Term Loan Facility increased to $575.0 million in term loans in two equal tranches, the Revolving Credit Facility increased to a commitment of $455.0 million, and the Bridge Facility decreased to $170.0 million.
On August 7, 2026 the Company entered into the Second Amended and Restated Term Loan Agreement with Ally Bank (“Ally Term Loan”). See “Note 18–Subsequent Events.” Subsequent to quarter end, the Company repaid the Bridge Facility balance with proceeds from the Ally Term Loan. Accordingly, the $170.0 million Bridge Facility balance outstanding as of June 30, 2026 was classified as long-term debt.
Senior Secured Revolving Credit Facility
As of June 30, 2026, $258.0 million of borrowings were outstanding under the Revolving Credit Facility at a weighted average interest rate of 5.7%, which was secured by 83 of the Company’s senior living communities. During the six months ended June 30, 2026, the Company borrowed $307.5 million under the Revolving Credit Facility and repaid $144.6 million of borrowings. As the borrowing capacity increased in connection with the refinancing, fees on the refinancing and remaining unamortized fees on the Revolving Credit Facility were deferred and amortized over the remaining term with no gain or loss on debt modification or extinguishment recognized. The Company incurred $5.9 million of deferred loan costs related to its Revolving Credit Facility during the six months ended June 30, 2026. As of June 30, 2026, the Company had an additional borrowing capacity of up to $197.0 million under the Revolving Credit Facility. See “Note 2–CHP Merger” for a discussion on the change in finance structure. See “Note 18–Subsequent Events.”
2025 Ally Term Loan
On August 7, 2025, the Company entered into a senior secured term loan of $137.0 million (“2025 Ally Term Loan”) with Ally Bank (“Ally”) with a closing fee of 0.75%, or $1.0 million. The 2025 Ally Term Loan amended and restated the Company’s then-existing term loan with Ally, dated as of March 10, 2022, as amended. The amendment resulted in the removal of one lender from the loan commitment. Following this amendment, only one member remains under the facility. The 2025 Ally Term Loan allowed for an initial term loan advance on the closing date of $122.0 million secured by 19 communities, which included 18 communities under the then-existing Ally term loan agreement, as well as the Alpharetta community acquired in June 2025. Two additional draws of $7.5 million each will become available subject to achieving certain debt yields and debt service coverages ratios. The 2025 Ally Term Loan has a 36-month maturity date and a variable interest rate of one-month SOFR plus a 2.65% margin (subject to a performance-based stepdown to a 2.45% margin). As of June 30, 2026, the Company has $122.0 million outstanding under the 2025 Ally Term Loan, which has a maturity date of August 2028. The Company has
the ability to request an increase in the term loan up to $40.0 million to finance additional properties subject to lender due diligence and review. See “Note 18–Subsequent Events.”
Mortgage Loan Extinguishment
On June 30, 2026, we completed the sale of one of our communities for a purchase price of $9.4 million. At the time of the sale, the community had an outstanding loan principal balance of $13.0 million. As part of the sale, the mortgage lender agreed to accept payment from the buyer and forgave the remaining balance due on the loan and $0.4 million of accrued interest. The transaction resulted in a gain on extinguishment of debt of $3.9 million for the three and six months ended June 30, 2026.
Notes Payable - Consolidated VIE
As of June 30, 2026, the Company had $19.9 million of mortgage debt outstanding related to the Palatine JV. The mortgages have a weighted average interest rate of 6.4% and terms ranging from 2026 through 2027. The Company has guaranteed $3.1 million of the Palatine JV mortgages. In addition, one of the affiliates in the Palatine JV entered into a SOFR-based IRC to reduce exposure to the variable interest rate fluctuations associated with one of the mortgages at a cost of $0.1 million.
Fannie Mae Loan Modification
In December 2024, the Company and certain of its subsidiaries entered into an amendment to its multifamily loan and security agreements with Federal National Mortgage Association (“Fannie Mae”). The amendment amended the terms of each of the loan agreements with Fannie Mae relating to 18 of the Company’s senior living communities and extended the maturity dates of each loan from December 1, 2026 to January 1, 2029 in exchange for $10.0 million of scheduled principal paydowns. The Company has made $4.0 million in principal payments as of June 30, 2026 and is scheduled to pay $3.0 million in November 2026 and November 2027.
Deferred Loan Costs
As of June 30, 2026 and December 31, 2025, the Company had gross deferred loan costs of $24.1 million and $12.5 million, respectively, related to notes payable. During the six months ended June 30, 2026, the Company incurred an additional $11.8 million in gross deferred loan costs in relation to the debt financing of the CHP Merger and the related Term Loan Facility and Bridge Facility. Accumulated amortization was $12.1 million and $9.1 million as of June 30, 2026 and December 31, 2025, respectively.
Financial Covenants
Certain of the Company's debt agreements contain restrictions and financial covenants, which require the Company to maintain prescribed minimum liquidity, net worth, and shareholders' equity levels and debt service ratios, and require the Company not to exceed prescribed leverage ratios, in each case on a consolidated, portfolio-wide, multi-community, single-community, and/or entity basis. In addition, the Company's debt agreements generally contain non-financial covenants, such as those requiring the Company to comply with Medicaid provider requirements and maintain insurance coverage.
The Company's failure to comply with applicable covenants could constitute an event of default under the applicable debt agreements. Many of the Company's debt agreements contain cross-default provisions so that a default under one of these instruments could cause a default under other debt agreements (including with other lenders). Furthermore, the Company's mortgage debt is secured by its communities and, in certain cases, a guaranty by the Company and/or one or more of its subsidiaries.
As of June 30, 2026, the Company was in compliance with the financial covenants of its debt agreements.