First Quarter Net Income of $37.9 Million,
or $0.78 Per Share
First Quarter Normalized FFO of $61.8
Million, or $1.28 Per Share
First Quarter CAD of $47.7 Million, or $0.99
Per Share
Completed 575,000 Square Feet of Leasing for
a 3.2% Roll-up in Rents
Office Properties Income Trust (Nasdaq: OPI) today announced its
financial results for the quarter ended March 31, 2021.
Christopher Bilotto, President and Chief Operating Officer of
OPI, made the following statement:
“We entered 2021 following strong performance in 2020 and
continued that trend through the first quarter as evidenced by our
increased liquidity and positive leasing results. Rent collections
remained strong over the past year averaging above 99% and our
balance sheet has over $930 million of liquidity allowing OPI to
remain focused on our primary growth strategies through leasing and
acquisitions.
In the first quarter, we completed 575,000 square feet of new
and renewal leasing with a roll-up in rent of 3.2% and a weighted
average lease term of 5.4 years. We also have a current leasing
pipeline of over three million square feet that is in active
discussion. We are encouraged by this activity as tenants continue
to advance decisions for their office needs and believe our
portfolio composition has benefited OPI throughout the
pandemic."
Quarterly Results:
Three Months Ended March
31,
2021
2020
Financial
(dollars in thousands, except per
share data)
Net income
$37,860
$10,840
Net income per share
$0.78
$0.23
Normalized FFO per share
$1.28
$1.40
CAD per share
$0.99
$0.98
Same Property Cash Basis NOI
$88,684
$90,295
- Net income for the quarter ended March 31, 2021 was $37.9
million, or $0.78 per diluted share, compared to net income of
$10.8 million, or $0.23 per diluted share, for the quarter ended
March 31, 2020. Net income for the quarter ended March 31, 2021
includes a $54.0 million, or $1.12 per diluted share, gain on sale
of real estate, partially offset by a $7.7 million, or $0.16 per
diluted share, loss on impairment of real estate and $5.2 million,
or $0.11 per diluted share, of estimated business management
incentive fee expense. Net income for the quarter ended March 31,
2020 includes a $10.8 million, or $0.22 per diluted share, gain on
sale of real estate, partially offset by a $3.3 million, or $0.07
per diluted share, loss on early extinguishment of debt. The
estimated business management incentive fee expense recognized for
the quarter ended March 31, 2021 is the result of OPI's common
share total return, as defined in OPI's business management
agreement, exceeding the returns for the SNL U.S. REIT Office index
by 15.0% over the applicable measurement period. The actual amount
of annual incentive fees for 2021, if any, will be based on OPI's
common share total return for the three-year period ending December
31, 2021, and will be payable in January 2022.
- Normalized funds from operations, or Normalized FFO, and cash
available for distribution, or CAD, for the quarter ended March 31,
2021 were $61.8 million, or $1.28 per diluted share, and $47.7
million, or $0.99 per diluted share, respectively, compared to
Normalized FFO and CAD for the quarter ended March 31, 2020 of
$67.6 million, or $1.40 per diluted share, and $47.4 million, or
$0.98 per diluted share, respectively.
- Same Property cash basis net operating income, or Cash Basis
NOI, decreased 1.8% for the quarter ended March 31, 2021 compared
to the quarter ended March 31, 2020. The decrease in Same Property
Cash Basis NOI is primarily due to a decrease in cash revenues of
$1.4 million driven by a decrease of $0.7 million in parking
revenue as a result of lower parking activity due to the COVID-19
pandemic and lower cash received from contractual rents of $0.7
million due to reductions in occupied space at certain of OPI's
properties. Operating expenses also increased by $0.2 million,
mainly driven by an increase in snow removal costs which were
partially offset by lower utility and cleaning costs due to lower
building utilization levels at OPI's properties.
- Leasing activity for the quarter ended March 31, 2021 was as
follows:
Three Months Ended
March 31, 2021
Leasing activity for new and renewal
leases (rentable square feet)
575,000
Weighted average rental rate change (by
rentable square feet)
3.2%
Weighted average lease term (by rentable
square feet)
5.4 years
Leasing concessions and capital
commitments (per square foot per lease year)
$2.28
As of
Percent Leased
March 31, 2021
December 31, 2020
March 31, 2020
All properties
90.8%
91.2%
91.5%
Same properties
91.3%
92.1%
92.1%
Reconciliations of net income determined in accordance with U.S.
generally accepted accounting principles, or GAAP, to funds from
operations, or FFO, Normalized FFO, CAD, net operating income, or
NOI, and Cash Basis NOI, and a reconciliation of NOI to Same
Property NOI and Same Property Cash Basis NOI, for the quarters
ended March 31, 2021 and 2020 appear later in this press
release.
Acquisition Activities:
- As of April 28, 2021, OPI has entered into an agreement to
acquire a property adjacent to a property it owns in Boston, MA
containing approximately 49,000 rentable square feet for a purchase
price of $27.0 million, excluding acquisition related costs. This
property is 49.5% leased with a weighted average lease term of 2.3
years. This acquisition is expected to occur before the end of the
second quarter.
Disposition Activities:
- As previously reported, in January 2021, OPI sold a warehouse
facility adjacent to a property it owns in Kansas City, MO
containing approximately 10,000 rentable square feet for a sales
price of $0.8 million, excluding closing costs.
- Also as previously reported, in January 2021, OPI sold a
property located in Richmond, VA containing approximately 311,000
rentable square feet for a sales price of $130.0 million, excluding
closing costs.
- In April 2021, OPI sold a property located in Huntsville, AL
containing approximately 1,371,000 rentable square feet for a sales
price of $39.0 million, excluding closing costs.
- Also in April 2021, OPI entered into an agreement to sell a
property located in Liverpool, NY containing approximately 38,000
rentable square feet for a sales price of $0.7 million, excluding
closing costs. This sale is expected to occur before the end of the
second quarter.
Liquidity:
- As of March 31, 2021, OPI had $184.5 million of cash and cash
equivalents and $750.0 million available to borrow under its
unsecured revolving credit facility.
COVID-19 Update:
- OPI has granted temporary rent assistance to date totaling $2.5
million to 18 tenants, pursuant to deferred payment plans. These
tenants are required to pay, in most cases, one month of rent over
a 12-month period, all of which have commenced. The $2.5 million of
granted temporary rent assistance is detailed as follows:
Granted Rent
Deferrals
Percentage of
Total Granted
Rent Deferrals
Year ended December 31, 2020
$
2,482,399
100.0
%
Quarter ended March 31, 2021
770
—
%
Future deferrals
257
—
%
Total granted deferrals
$
2,483,426
100.0
%
Less: Amounts repaid (1)
(2,118,234
)
85.3
%
Outstanding granted rent deferral
balance
$
365,192
14.7
%
(1)
Represents rent deferrals repaid as of April 26, 2021.
- For the quarter ended March 31, 2021, OPI collected
approximately 99% of contractual rent obligations before and after
giving effect to such rent deferrals.
Conference Call:
On Friday, April 30, 2021 at 10:00 a.m. Eastern Time, President
and Chief Operating Officer, Christopher Bilotto, and Chief
Financial Officer and Treasurer, Matthew Brown, will host a
conference call to discuss OPI’s first quarter 2021 financial
results.
The conference call telephone number is (877) 328-1172.
Participants calling from outside the United States and Canada
should dial (412) 317-5418. No pass code is necessary to access the
call from either number. Participants should dial in about 15
minutes prior to the scheduled start of the call. A replay of the
conference call will be available through 11:59 p.m. on Friday, May
7, 2021. To access the replay, dial (412) 317-0088. The replay pass
code is 10153730.
A live audio webcast of the conference call will also be
available in a listen only mode on OPI’s website, at
www.opireit.com. Participants wanting to access the webcast should
visit OPI’s website about five minutes before the call. The
archived webcast will be available for replay on OPI’s website
following the call for about one week. The transcription,
recording and retransmission in any way of OPI’s first quarter
conference call are strictly prohibited without the prior written
consent of OPI.
Supplemental Data:
A copy of OPI’s First Quarter 2021 Supplemental Operating and
Financial Data is available for download at OPI’s website,
www.opireit.com. OPI’s website is not incorporated as part of this
press release.
Non-GAAP Financial Measures:
OPI presents certain “non-GAAP financial measures” within the
meaning of the applicable rules of the Securities and Exchange
Commission, or SEC, including FFO, Normalized FFO, CAD, NOI, Cash
Basis NOI, Same Property NOI and Same Property Cash Basis NOI.
These measures do not represent cash generated by operating
activities in accordance with GAAP and should not be considered
alternatives to net income as indicators of OPI’s operating
performance or as measures of OPI’s liquidity. These measures
should be considered in conjunction with net income as presented in
OPI's condensed consolidated statements of income. OPI considers
these non-GAAP measures to be appropriate supplemental measures of
operating performance for a real estate investment trust, or REIT,
along with net income. OPI believes these measures provide useful
information to investors because by excluding the effects of
certain historical amounts, such as depreciation and amortization
expense, they may facilitate a comparison of OPI’s operating
performance between periods and with other REITs and, in the case
of NOI, Cash Basis NOI, Same Property NOI and Same Property Cash
Basis NOI reflecting only those income and expense items that are
generated and incurred at the property level may help both
investors and management to understand the operations of OPI's
properties.
Please see the pages attached hereto for a more detailed
statement of OPI’s operating results and financial condition and
for an explanation of OPI’s calculation of FFO, Normalized FFO,
CAD, NOI, Cash Basis NOI, Same Property NOI and Same Property Cash
Basis NOI and a reconciliation of those amounts to amounts
determined in accordance with GAAP.
OPI is a REIT focused on owning, operating and leasing
properties primarily leased to single tenants and those with high
credit quality characteristics such as government entities. OPI is
managed by the majority owned operating subsidiary of The RMR Group
Inc. (Nasdaq: RMR), an alternative asset management company that is
headquartered in Newton, Massachusetts.
Office Properties Income
Trust
Condensed Consolidated
Statements of Income
(amounts in thousands, except
per share data)
(unaudited)
Three Months Ended March
31,
2021
2020
Rental income
$
144,524
$
149,885
Expenses:
Real estate taxes
16,154
16,807
Utility expenses
6,432
7,012
Other operating expenses
25,439
25,880
Depreciation and amortization
64,087
62,943
Loss on impairment of real estate (1)
7,660
—
General and administrative (2)
11,272
7,109
Total expenses
131,044
119,751
Gain on sale of real estate (3)
54,004
10,756
Interest and other income
5
706
Interest expense (including net
amortization of debt premiums, discounts and issuance costs of
$2,432 and $2,283, respectively)
(28,798
)
(27,159
)
Loss on early extinguishment of debt
(4)
—
(3,282
)
Income before income tax expense and
equity in net losses of investees
38,691
11,155
Income tax expense
(435
)
(39
)
Equity in net losses of investees
(396
)
(276
)
Net income
$
37,860
$
10,840
Weighted average common shares outstanding
(basic)
48,161
48,095
Weighted average common shares outstanding
(diluted)
48,196
48,095
Per common share amounts (basic and
diluted):
Net income
$
0.78
$
0.23
See Notes on pages 7 and 8.
Office Properties Income
Trust
Funds from Operations,
Normalized Funds from Operations and Cash Available for
Distribution
(amounts in thousands, except
per share data)
(unaudited)
Three Months Ended March
31,
2021
2020
Calculation of FFO, Normalized FFO and
CAD (5)(6):
Net income
$
37,860
$
10,840
Add (less): Depreciation and
amortization:
Consolidated properties
64,087
62,943
Unconsolidated joint venture
properties
1,006
1,241
Loss on impairment of real estate (1)
7,660
—
Gain on sale of real estate (3)
(54,004
)
(10,756
)
FFO
56,609
64,268
Loss on early extinguishment of debt
(4)
—
3,282
Estimated business management incentive
fees (2)
5,200
—
Normalized FFO
61,809
67,550
Add (less): Non-cash expenses (7)
(1
)
79
Distributions from unconsolidated joint
ventures
153
51
Depreciation and amortization -
unconsolidated joint ventures
(1,006
)
(1,241
)
Equity in net losses of investees
396
276
Loss on early extinguishment of debt
settled in cash
—
(1,138
)
Non-cash straight line rent adjustments
included in rental income
(5,357
)
(5,583
)
Lease value amortization included in
rental income
722
1,432
Net amortization of debt premiums,
discounts and issuance costs
2,432
2,283
Recurring capital expenditures
(11,496
)
(16,343
)
CAD (6)
$
47,652
$
47,366
Weighted average common shares outstanding
(basic)
48,161
48,095
Weighted average common shares outstanding
(diluted)
48,196
48,095
Per common share amounts (basic and
diluted):
Net income
$
0.78
$
0.23
FFO (basic)
$
1.18
$
1.34
FFO (diluted)
$
1.17
$
1.34
Normalized FFO
$
1.28
$
1.40
CAD
$
0.99
$
0.98
Distributions declared per share
$
0.55
$
0.55
(1)
Loss on impairment of real estate for the
three months ended March 31, 2021 represents an adjustment of
$7,660 to reduce the carrying value of two properties to their
estimated fair values less costs to sell.
(2)
Incentive fees under OPI's business
management agreement with The RMR Group LLC are payable after the
end of each calendar year, are calculated based on common share
total return, as defined, and are included in general and
administrative expense in OPI’s condensed consolidated statements
of income. In calculating net income in accordance with GAAP, OPI
recognizes estimated business management incentive fee expense, if
any, in the first, second and third quarters. Although OPI
recognizes this expense, if any, in the first, second and third
quarters for purposes of calculating net income, OPI does not
include such expense in the calculation of Normalized FFO until the
fourth quarter, when the amount of the business management
incentive fee expense for the calendar year, if any, is determined.
Net income includes $5,200 of estimated business management
incentive fee expense for the three months ended March 31, 2021. No
estimated business management incentive fee expense was included in
net income for the three months ended March 31, 2020.
(3)
Gain on sale of real estate for the three
months ended March 31, 2021 represents a $54,004 net gain on the
sale of two properties. Gain on sale of real estate for the three
months ended March 31, 2020 represents a $10,756 net gain on the
sale of six properties.
(4)
Loss on early extinguishment of debt for
the three months ended March 31, 2020 includes prepayment fees
related to the repayment of two mortgage notes, as well as write
offs of the unamortized portion of certain discounts and issuance
costs resulting from the early repayment of debt.
(5)
OPI calculates FFO and Normalized FFO as
shown above. FFO is calculated on the basis defined by The National
Association of Real Estate Investment Trusts, which is net income,
calculated in accordance with GAAP, plus real estate depreciation
and amortization of consolidated properties and its proportionate
share of the real estate depreciation and amortization of
unconsolidated joint venture properties, but excluding impairment
charges on real estate assets and any gain or loss on sale of real
estate, as well as certain other adjustments currently not
applicable to OPI. In calculating Normalized FFO, OPI adjusts for
the other items shown above and includes business management
incentive fees, if any, only in the fourth quarter versus the
quarter when they are recognized as an expense in accordance with
GAAP due to their quarterly volatility not necessarily being
indicative of OPI’s core operating performance and the uncertainty
as to whether any such business management incentive fees will be
payable when all contingencies for determining such fees are known
at the end of the calendar year. FFO and Normalized FFO are among
the factors considered by OPI’s Board of Trustees when determining
the amount of distributions to OPI’s shareholders. Other factors
include, but are not limited to, requirements to maintain OPI's
qualification for taxation as a REIT, limitations in OPI’s credit
agreement and public debt covenants, the availability to OPI of
debt and equity capital, OPI’s expectation of its future capital
requirements and operating performance and OPI’s expected needs for
and availability of cash to pay its obligations. Other real estate
companies and REITs may calculate FFO and Normalized FFO
differently than OPI does.
(6)
OPI calculates CAD as shown above. OPI
defines CAD as Normalized FFO minus recurring real estate related
capital expenditures and other non-cash and non-recurring items.
CAD is among the factors considered by OPI's Board of Trustees when
determining the amount of distributions to its shareholders. Other
real estate companies and REITs may calculate CAD differently than
OPI does.
(7)
Non-cash expenses include equity based
compensation, adjustments recorded to capitalize interest expense
and amortization of the liability for the amount by which the
estimated fair value for accounting purposes exceeded the price OPI
paid for its former investment in The RMR Group Inc., or RMR Inc.,
common stock in June 2015. This liability is being amortized on a
straight line basis through December 31, 2035 as an allocated
reduction to business management fee expense and property
management fee expense, which are included in general and
administrative and other operating expenses, respectively.
Office Properties Income
Trust
Calculation and Reconciliation
of NOI, Cash Basis NOI, Same Property NOI and
Same Property Cash Basis NOI
(1)
(amounts in thousands)
(unaudited)
Three Months Ended March
31,
2021
2020
Calculation of NOI and Cash Basis
NOI:
Rental income
$
144,524
$
149,885
Property operating expenses
(48,025
)
(49,699
)
NOI
96,499
100,186
Non-cash straight line rent adjustments
included in rental income
(5,357
)
(5,583
)
Lease value amortization included in
rental income
722
1,432
Lease termination fees included in rental
income
—
(3
)
Non-cash amortization included in property
operating expenses (2)
(121
)
(121
)
Cash Basis NOI
$
91,743
$
95,911
Reconciliation of Net Income to NOI and
Cash Basis NOI:
Net income
$
37,860
$
10,840
Equity in net losses of investees
396
276
Income tax expense
435
39
Income before income tax expense and
equity in net losses of investees
38,691
11,155
Loss on early extinguishment of debt
—
3,282
Interest expense
28,798
27,159
Interest and other income
(5
)
(706
)
Gain on sale of real estate
(54,004
)
(10,756
)
General and administrative
11,272
7,109
Loss on impairment of real estate
7,660
—
Depreciation and amortization
64,087
62,943
NOI
96,499
100,186
Non-cash amortization included in property
operating expenses (2)
(121
)
(121
)
Lease termination fees included in rental
income
—
(3
)
Lease value amortization included in
rental income
722
1,432
Non-cash straight line rent adjustments
included in rental income
(5,357
)
(5,583
)
Cash Basis NOI
$
91,743
$
95,911
Reconciliation of NOI to Same Property
NOI (3):
Rental income
$
144,524
$
149,885
Property operating expenses
(48,025
)
(49,699
)
NOI
96,499
100,186
Less: NOI of properties not included in
same property results
(2,640
)
(6,086
)
Same Property NOI
$
93,859
$
94,100
Calculation of Same Property Cash Basis
NOI (3):
Same Property NOI
$
93,859
$
94,100
Add: Lease value amortization included in
rental income
722
839
Less: Non-cash straight line rent
adjustments included in rental income
(5,782
)
(4,528
)
Lease termination fees included in rental
income
—
(3
)
Non-cash amortization included in property
operating expenses (2)
(115
)
(113
)
Same Property Cash Basis NOI
$
88,684
$
90,295
See Notes on page 10.
(1)
The calculations of NOI and Cash Basis NOI
exclude certain components of net income in order to provide
results that are more closely related to OPI’s property level
results of operations. OPI calculates NOI and Cash Basis NOI as
shown above. OPI defines NOI as income from its rental of real
estate less its property operating expenses. NOI excludes
amortization of capitalized tenant improvement costs and leasing
commissions that OPI records as depreciation and amortization
expense. OPI defines Cash Basis NOI as NOI excluding non-cash
straight line rent adjustments, lease value amortization, lease
termination fees, if any, and non-cash amortization included in
other operating expenses. OPI calculates Same Property NOI and Same
Property Cash Basis NOI in the same manner that it calculates the
corresponding Cash Basis NOI amounts, except that it only includes
same properties in calculating Same Property NOI and Same Property
Cash Basis NOI. OPI uses NOI, Cash Basis NOI, Same Property NOI and
Same Property Cash Basis NOI to evaluate individual and
company-wide property level performance. Other real estate
companies and REITs may calculate NOI, Cash Basis NOI, Same
Property NOI and Same Property Cash Basis NOI differently than OPI
does.
(2)
OPI recorded a liability for the amount by
which the estimated fair value for accounting purposes exceeded the
price OPI paid for its former investment in RMR Inc. common stock
in June 2015. A portion of this liability is being amortized on a
straight line basis through December 31, 2035 as a reduction to
property management fee expense, which is included in property
operating expenses.
(3)
For the three months ended March 31, 2021
and 2020, Same Property NOI and Same Property Cash Basis NOI are
based on properties OPI owned continuously since January 1, 2020,
and exclude properties classified as held for sale and properties
undergoing significant redevelopment, if any, and three properties
owned by two unconsolidated joint ventures in which OPI owns 51%
and 50% interests.
Office Properties Income
Trust
Condensed Consolidated Balance
Sheets
(dollars in thousands, except
per share data)
(unaudited)
March 31,
December 31,
2021
2020
ASSETS
Real estate properties:
Land
$
824,622
$
830,884
Buildings and improvements
2,650,159
2,691,259
Total real estate properties, gross
3,474,781
3,522,143
Accumulated depreciation
(467,085
)
(451,914
)
Total real estate properties, net
3,007,696
3,070,229
Assets of properties held for sale
47,918
75,177
Investments in unconsolidated joint
ventures
37,402
37,951
Acquired real estate leases, net
505,582
548,943
Cash and cash equivalents
184,462
42,045
Restricted cash
17,013
14,810
Rents receivable
94,879
101,766
Deferred leasing costs, net
44,680
42,626
Other assets, net
12,947
12,889
Total assets
$
3,952,579
$
3,946,436
LIABILITIES AND SHAREHOLDERS’ EQUITY
Unsecured revolving credit facility
$
—
$
—
Senior unsecured notes, net
2,035,304
2,033,242
Mortgage notes payable, net
169,204
169,729
Liabilities of properties held for
sale
84
891
Accounts payable and other liabilities
103,617
116,480
Due to related persons
13,370
6,114
Assumed real estate lease obligations,
net
10,002
10,588
Total liabilities
2,331,581
2,337,044
Commitments and contingencies
Shareholders’ equity:
Common shares of beneficial interest, $.01
par value: 200,000,000 shares authorized, 48,318,366 shares issued
and outstanding
483
483
Additional paid in capital
2,615,626
2,615,305
Cumulative net income
221,755
183,895
Cumulative common distributions
(1,216,866
)
(1,190,291
)
Total shareholders’ equity
1,620,998
1,609,392
Total liabilities and shareholders’
equity
$
3,952,579
$
3,946,436
Warning Concerning
Forward-Looking Statements
This press release contains statements that constitute
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995 and other securities laws.
Also, whenever OPI uses words such as “believe”, “expect”,
“anticipate”, “intend”, “plan”, “estimate”, “will”, “may” and
negatives or derivatives of these or similar expressions, OPI is
making forward-looking statements. These forward-looking statements
are based upon OPI’s present intent, beliefs or expectations, but
forward-looking statements are not guaranteed to occur and may not
occur. Actual results may differ materially from those contained in
or implied by OPI’s forward-looking statements as a result of
various factors. Forward-looking statements involve known and
unknown risks, uncertainties and other factors, some of which are
beyond OPI's control. For example:
- Mr. Bilotto's statements about OPI's strong performance,
including with respect to rent collections, leasing activity and
roll-ups in rent, may imply that OPI will continue to have similar
and better performance in future periods. However, OPI's rent
collections, ability to realize positive leasing activity and
roll-ups in rent depend on various factors, including market
conditions, the impact of the COVID-19 pandemic, the financial
strength of OPI's tenants, tenants' demand for OPI's properties,
the timing of lease expirations and OPI's ability to successfully
compete for tenants, among other factors. As a result, OPI may not
have positive rent collections or realize positive leasing activity
and rent roll-ups in the future and OPI's rent collections, leasing
activity, and occupancy could decline and OPI may realize rent
roll-downs and decreased rental income in the future,
- Mr. Bilotto states that OPI has over $930 million of liquidity.
This may imply that OPI will maintain this level of liquidity in
the future. However, OPI's liquidity is largely dependent on the
availability of funds under its revolving credit facility. OPI's
revolving credit facility allows OPI to borrow, repay and reborrow
funds under that facility, subject to satisfying conditions. As a
result, OPI may, and likely will, borrow funds under its revolving
credit facility in the future, which in turn would cause its
liquidity to decline. In addition, OPI may use its current
liquidity for investments or other business opportunities, which
may reduce its liquidity,
- Mr. Bilotto's statements about OPI's growth strategies
including acquisitions may imply that OPI will be able to continue
to execute on its investment strategies and create value from those
investments. However, OPI may not be able to identify and
successfully negotiate and complete acquisitions and it may not
realize its target returns on investments it may make,
- Mr. Bilotto states that OPI has a current leasing pipeline of
over three million square feet that is in active discussion. This
may imply that OPI will successfully execute leases for that space
on terms that are on acceptable terms to OPI. However, OPI may not
be able to successfully negotiate and execute leases for any or all
of that space on terms that are acceptable to OPI,
- Mr. Bilotto's statements regarding OPI's tenants advancing
decisions for their office needs may imply that OPI's tenants will
re-enter OPI's properties in the future. However, if the COVID-19
pandemic and the current economic conditions continue or worsen,
OPI’s tenants may be significantly adversely impacted, which may
result in additional tenants seeking relief from their rent
obligations, tenants being unable to pay rent, tenants terminating
their leases or tenants not renewing their leases or renewing their
leases for less space. Further, under those conditions, tenants may
delay re-entry or may utilize less space upon re-entry and later
seek to reduce their leased space or terminate or not renew their
leases. In addition, leases for 3,517,000 square feet are currently
subject to expire by March 31, 2022, and OPI currently expects
tenants that lease 2,701,000 of that square feet will not renew
their leases. OPI may not be able to re-lease that space, or sell
any properties it identifies for sale that include a portion of
that space, and it may take an extended period to identify
replacement tenants and negotiate and enter new lease agreements
for that space and OPI may realize rent roll-downs with respect to
any such new leases, and
- OPI has entered into an agreement to acquire a property for a
purchase price of $27.0 million, excluding acquisition related
costs, and an agreement to sell a property for a sales price of
$0.7 million, excluding closing costs. These transactions are
subject to conditions. Those conditions may not be satisfied and
these transactions may not occur, may be delayed or the terms may
change.
The information contained in OPI’s filings with the SEC,
including under “Risk Factors” in OPI’s periodic reports, or
incorporated therein, identifies other important factors that could
cause OPI’s actual results to differ materially from those stated
in or implied by OPI’s forward-looking statements. OPI’s filings
with the SEC are available on the SEC's website at www.sec.gov.
You should not place undue reliance upon forward-looking
statements.
Except as required by law, OPI does not intend to update or
change any forward-looking statements as a result of new
information, future events or otherwise.
A Maryland Real Estate Investment Trust with
transferable shares of beneficial interest listed on the Nasdaq. No
shareholder, Trustee or officer is personally liable for any act or
obligation of the Trust.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210429005973/en/
Olivia Snyder, Manager, Investor Relations (617) 219-1410
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