Seven Hills Realty Trust Files 2023 10-K

TL;DR

<b>Seven Hills Realty Trust has filed its annual 10-K report for the fiscal year ending December 31, 2023.</b>

AI Summary

Seven Hills Realty Trust (SEVN) filed a Annual Report (10-K) with the SEC on February 20, 2024. Seven Hills Realty Trust filed its 2023 10-K on February 20, 2024. The filing covers the fiscal year ending December 31, 2023. The company was formerly known as RMR Mortgage Trust, RMR Real Estate Income Fund, and RMR Asia Pacific Real Estate Fund. The filing includes data for common stock, additional paid-in capital, retained earnings, and accumulated distributions in excess of net income for 2021, 2022, and 2023. Specific asset categories mentioned include land, building improvements, and tenant improvements as of December 31, 2023.

Why It Matters

For investors and stakeholders tracking Seven Hills Realty Trust, this filing contains several important signals. This 10-K filing provides a comprehensive overview of Seven Hills Realty Trust's financial performance and operations for the fiscal year 2023, which is crucial for investors to assess the company's stability and growth prospects. The historical company name changes indicate potential strategic shifts or rebranding efforts, which investors should consider when evaluating the company's long-term trajectory and market positioning.

Risk Assessment

Risk Level: low — Seven Hills Realty Trust shows low risk based on this filing. The filing is a standard 10-K, which is a routine annual report and does not contain immediate red flags or significant negative developments.

Analyst Insight

Review the detailed financial statements and risk factors within the 10-K to understand Seven Hills Realty Trust's performance and outlook for the upcoming fiscal year.

Key Numbers

• 2023-12-31 — Fiscal Year End (Reporting period)
• 2024-02-20 — Filing Date (Date of submission)
• 6798 — SIC Code (Standard Industrial Classification)
• MD — State of Incorporation (Legal domicile)

Key Players & Entities

• Seven Hills Realty Trust (company) — Filer name
• RMR Mortgage Trust (company) — Former company name
• RMR Real Estate Income Fund (company) — Former company name
• RMR Asia Pacific Real Estate Fund (company) — Former company name
• 2023-12-31 (date) — Fiscal year end
• 2024-02-20 (date) — Filing date

FAQ

Industry Context

Seven Hills Realty Trust operates within the Real Estate Investment Trusts (REITs) sector, which is characterized by its focus on owning, operating, or financing income-generating real estate.

Regulatory Implications

As a publicly traded company, Seven Hills Realty Trust is subject to the regulations of the Securities and Exchange Commission (SEC), requiring regular filings like the 10-K to ensure transparency for investors.

What Investors Should Do

1. Analyze the balance sheet and income statement for the fiscal year 2023.
2. Review any disclosed risk factors related to real estate market conditions or operational challenges.
3. Compare key financial metrics from this 10-K to previous filings to identify trends.

Key Dates

• 2023-12-31: Fiscal Year End — End of the reporting period for the 10-K.
• 2024-02-20: Filing Date — Date the 10-K was officially filed with the SEC.

Year-Over-Year Comparison

This is the initial 10-K filing for Seven Hills Realty Trust under its current name, but historical data from previous entities is available.

Key Financial Figures

• $0.001 — ange on which registered Common stock, $0.001 par value per share SEVN The Nasdaq Sto
• $10.26 — roximately $ 129.4 million based on the $10.26 closing price per common share on The N
• $15.0 million — oating rate first mortgage loans in the $15.0 million to $75.0 million range, secured by midd
• $75.0 million — mortgage loans in the $15.0 million to $75.0 million range, secured by middle market and tra
• $100.0 million — RE properties that have values of up to $100.0 million. We define transitional CRE as commerci
• $670.3 million — oans with aggregate loan commitments of $670.3 million with a weighted average maximum maturit
• $670.3 m — r investment with a total commitment of $670.3 million, of which $40.4 million remained
• $40.4 million — commitment of $670.3 million, of which $40.4 million remained unfunded. The charts below det
• $41 billion — of December 31, 2023, RMR Inc. had over $41 billion of real estate assets under management
• $5 billion — ned RMR managed companies had more than $5 billion of annual revenues, over 2,000 properti

Filing Documents

• sevn-20231231.htm (10-K) — 1848KB
• sevn_123123xexhibitx81.htm (EX-8.1) — 10KB
• sevn_123123xexhibitx211.htm (EX-21.1) — 7KB
• sevn_123123xexhibitx231.htm (EX-23.1) — 2KB
• sevn_123123xexhibitx311.htm (EX-31.1) — 10KB
• sevn_123123xexhibitx312.htm (EX-31.2) — 10KB
• sevn_123123xexhibitx313.htm (EX-31.3) — 10KB
• sevn_123123xexhibitx314.htm (EX-31.4) — 10KB
• sevn_123123xexhibitx321.htm (EX-32.1) — 8KB
• sevn_123123xexhibitx971.htm (EX-97.1) — 5KB
• image.jpg (GRAPHIC) — 23KB
• image1.jpg (GRAPHIC) — 7KB
• image_0.jpg (GRAPHIC) — 5KB
• sevn-20231231_g1.jpg (GRAPHIC) — 34KB
• sevn-20231231_g2.jpg (GRAPHIC) — 37KB
• 0001452477-24-000011.txt (&nbsp;) — 8212KB
• sevn-20231231.xsd (EX-101.SCH) — 66KB
• sevn-20231231_cal.xml (EX-101.CAL) — 64KB
• sevn-20231231_def.xml (EX-101.DEF) — 249KB
• sevn-20231231_lab.xml (EX-101.LAB) — 674KB
• sevn-20231231_pre.xml (EX-101.PRE) — 417KB
• sevn-20231231_htm.xml (XML) — 1135KB

Business

Business 7 Item 1A.

Risk Factors

Risk Factors 33 Item 1B. Unresolved Staff Comments 60 Item 1C. Cybersecurity 60 Item 2.

Properties

Properties 60 Item 3.

Legal Proceedings

Legal Proceedings 60 Item 4. Mine Safety Disclosures 60 PART II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 61 Item 6. [Reserved] 61 Item 7.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 61 Item 7A.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 74 Item 8.

Financial Statements and Supplementary Data

Financial Statements and Supplementary Data 74 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 74 Item 9A .

Controls and Procedures

Controls and Procedures 75 Item 9B. Other Information 75 Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 75 PART III Item 10. Directors, Executive Officers and Corporate Governance 76 Item 11.

Executive Compensation

Executive Compensation 76 Item 12.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 76 Item 13. Certain Relationships and Related Transactions, and Director Independence 76 Item 14. Principal Accountant Fees and Services 76 PART IV Item 15. Exhibits and Financial Statement Schedules 77 Item 16. Form 10-K Summary 79

Signatures

Signatures 6 Table of Contents PART I

Business

Item 1. Business Our Company. Seven Hills Realty Trust is a Maryland REIT that focuses primarily on originating and investing in floating rate first mortgage loans in the $15.0 million to $75.0 million range, secured by middle market and transitional CRE properties that have values of up to $100.0 million. We define transitional CRE as commercial properties subject to redevelopment or repositioning activities that are expected to increase the value of the properties. As of December 31, 2023, we had a portfolio of 24 floating rate first mortgage loans with aggregate loan commitments of $670.3 million with a weighted average maximum maturity of 3.0 years, weighted average coupon rate of 9.19% and 9.64% all in yield. We operate our business in a manner consistent with our qualification for taxation as a REIT under the Internal Revenue Code of 1986, or the IRC. As such, we generally are not subject to U.S. federal income tax, provided that we meet certain distribution and other requirements. We also operate our business in a manner that permits us to maintain our exemption from registration under the 1940 Act. Our principal executive offices are located at Two Newton Place, 255 Washington Street, Suite 300, Newton, Massachusetts 02458-1634, and our telephone number is 617-332-9530. Our Investment and Leverage Strategies. Our primary investment strategy is to balance capital preservation with generating attractive, risk adjusted returns by creating customized loan structures tailored to borrowers' specific business plans for the underlying collateral properties. To this end, the loans that we target for origination and investment generally have the following characteristics: first mortgage loans with principal balances ranging from $15.0 million to $75.0 million; stabilized loan to value ratios, or LTVs, of 75% or less; terms of five years or less; floating interest rates based on the Secured Overnight Financing Rate, or SOFR, plus a margin that is competitive i

View Full Filing

View this 10-K filing on SEC EDGAR