Education Realty Trust has received $222 million in funding through a secured credit facility with Red Mortgage Capital, a Fannie Mae DUS lender. The student housing real estate investment trust (REIT) is using the capital to manage its debt coming due.

The REIT has drawn down about $198 million under the facility to retire $185 million in first mortgage debt that was due to mature in July. The early retirement of debt has led to a loss of about $4 million in defeasance and transaction costs.

The money also was used to reduce Education Realty Trust’s corporate revolving credit facility and to provide working capital.

The average fixed rate on $148 million in initial loans under the credit facility is about 6.01%. The rate on another $50 million of floating-rate loans, tied to the London Inter Bank Offered Rate (LIBOR), is currently 3.82%.

“We were able to close on the Fannie Mae facility at attractive interest rates and favorable terms, eliminating a majority of the company’s debt maturity risk in 2009,” says Randy Brown, chief financial officer of Education Realty Trust. “Furthermore, we continue to work towards securing additional financing for the remainder of our property debt which does not mature until December 2009.”

In another related development, Education Realty Trust received an extension of its $100 million secured revolving credit facility with KeyBank until 2010. There is about $65 million of credit available under the facility.

In one more move that will result in additional cash flow for the REIT in 2009, Education Realty Trust has cut down on its annual dividend payout for the year to $0.41 per share. This will result in savings of about $12 million, according to Brown.