Industrial Logistics Properties Trust (ILPT)

CIK: 0001717307. SIC: 6798 Real Estate Investment Trusts. Latest 10-K as of: 2026-02-18.

SIC breadcrumb: Finance, Insurance, And Real Estate > Holding And Other Investment Offices > SIC 6798 Real Estate Investment Trusts

SEC company page: https://www.sec.gov/edgar/browse/?CIK=1717307. Latest filing source: 0001717307-26-000012.

Selected Fundamentals

Financials

Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-02-18. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001717307.json. Derived margins, ratios, and free cash flow are computed from the extracted annual SEC facts.

Flow metrics use full-year FY periods from 10-K/10-K/A filings; balance-sheet metrics use FY-end instants. Free cash flow = operating cash flow - capital expenditures. Missing metrics are omitted rather than fabricated.

Ratios

ROE and ROA use period-end equity/assets. Liabilities / equity uses total liabilities divided by stockholders' equity. Current ratio uses current assets divided by current liabilities when both are reported.

Financial Charts

Quarterly

Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-04-29. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001717307.json.

Flow metrics use discrete quarter-length periods from 10-Q/10-Q/A filings. Q4 revenue and net income are derived only when annual FY and nine-month YTD facts exist for the same fiscal year; derived Q4 values are labeled. EPS Q4 is not derived.

Quarterly Charts

Macro Cross-References

• CPIAUCSL - Consumer Price Index for All Urban Consumers: All Items in U.S. City Average
• UNRATE - Unemployment Rate
• FEDFUNDS - Federal Funds Effective Rate
• CES0500000003 - Average Hourly Earnings of All Employees, Total Private
• DFEDTARU - Federal Funds Target Range - Upper Limit
• DFEDTARL - Federal Funds Target Range - Lower Limit
• DGS3MO - Market Yield on U.S. Treasury Securities at 3-Month Constant Maturity
• DGS2 - Market Yield on U.S. Treasury Securities at 2-Year Constant Maturity
• DGS10 - Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity
• DGS30 - Market Yield on U.S. Treasury Securities at 30-Year Constant Maturity
• T10Y2Y - 10-Year Treasury Constant Maturity Minus 2-Year Treasury Constant Maturity
• CPILFESL - Consumer Price Index for All Urban Consumers: All Items Less Food and Energy
• CPIUFDSL - Consumer Price Index for All Urban Consumers: Food
• CPIENGSL - Consumer Price Index for All Urban Consumers: Energy
• CUSR0000SAH1 - Consumer Price Index for All Urban Consumers: Shelter
• PCEPI - Personal Consumption Expenditures: Chain-type Price Index
• PCEPILFE - Personal Consumption Expenditures Excluding Food and Energy: Chain-type Price Index
• PPIACO - Producer Price Index by Commodity: All Commodities
• T10YIE - 10-Year Breakeven Inflation Rate
• U6RATE - Total Unemployed, Plus All Marginally Attached Workers Plus Total Employed Part Time for Economic Reasons
• PAYEMS - All Employees, Total Nonfarm
• CIVPART - Labor Force Participation Rate
• EMRATIO - Employment-Population Ratio
• UNEMPLOY - Unemployed
• CE16OV - Employment Level
• ICSA - Initial Claims
• JTSJOL - Job Openings: Total Nonfarm
• JTSQUR - Quits: Total Nonfarm
• GDPC1 - Real Gross Domestic Product
• A191RL1Q225SBEA - Real Gross Domestic Product: Percent Change from Preceding Period
• INDPRO - Industrial Production: Total Index
• TCU - Capacity Utilization: Total Index
• HOUST - New Privately-Owned Housing Units Started: Total Units
• PERMIT - New Privately-Owned Housing Units Authorized in Permit-Issuing Places: Total Units
• RSAFS - Advance Retail Sales: Retail Trade
• PCE - Personal Consumption Expenditures
• DSPIC96 - Real Disposable Personal Income
• PSAVERT - Personal Saving Rate
• M2SL - M2
• BOPGSTB - U.S. International Trade in Goods and Services: Balance
• MSPUS - Median Sales Price of Houses Sold for the United States
• HSN1F - New One Family Houses Sold: United States
• RHORUSQ156N - Homeownership Rate in the United States
• TTLCONS - Total Construction Spending: Total Construction in the United States
• RRVRUSQ156N - Rental Vacancy Rate in the United States
• TOTALSL - Total Consumer Credit Owned and Securitized
• REVOLSL - Revolving Consumer Credit Owned and Securitized
• DRCCLACBS - Delinquency Rate on Credit Card Loans, All Commercial Banks
• GDP - Gross Domestic Product
• GPDI - Gross Private Domestic Investment
• GCE - Government Consumption Expenditures and Gross Investment
• PCEC - Personal Consumption Expenditures
• NETEXP - Net Exports of Goods and Services
• GFDEBTN - Federal Debt: Total Public Debt
• GFDEGDQ188S - Federal Debt: Total Public Debt as Percent of Gross Domestic Product
• FYFSD - Federal Surplus or Deficit
• FGRECPT - Federal Government Current Receipts
• FGEXPND - Federal Government: Current Expenditures
• MANEMP - All Employees, Manufacturing
• USCONS - All Employees, Construction
• USTRADE - All Employees, Retail Trade
• USFIRE - All Employees, Financial Activities
• USGOVT - All Employees, Government
• AWHAETP - Average Weekly Hours of All Employees, Total Private
• DGORDER - Manufacturers' New Orders: Durable Goods
• NEWORDER - Manufacturers' New Orders: Nondefense Capital Goods Excluding Aircraft
• BUSINV - Total Business Inventories
• EXPGS - Exports of Goods and Services
• IMPGS - Imports of Goods and Services
• IR - Import Price Index (End Use): All Commodities
• PPIFIS - Producer Price Index by Commodity: Final Demand

Latest quarter (10-Q)

Latest 10-Q source: 0001717307-26-000027.

Extracted structurally from real Item 2 body heading to real Item 3/4 boundary. Confidence: high. Filing date: 2026-04-29. Report date: 2026-03-31.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following information should be read in conjunction with our condensed consolidated financial statements and accompanying notes included in Part I, Item 1 of this Quarterly Report on Form 10-Q and with our 2025 Annual Report.

OVERVIEW (dollars in thousands, except per square foot data) 

We are a real estate investment trust, or REIT, organized under Maryland law. As of March 31, 2026, our portfolio was comprised of 409 properties containing approximately 59,604,000 rentable square feet located in 39 states with 94.6% occupancy, leased to approximately 300 different tenants. As of March 31, 2026, we also owned a 22% equity interest in the unconsolidated joint venture.

We believe consumer expectations, long-term growth of e-commerce and modernization of and demand for supply chain resiliency will keep demand for industrial properties strong for the foreseeable future. This continued demand has contributed to favorable market conditions, resulting in positive mark-to-market rents on our lease renewals and new leases. Currently, there are uncertainties in global and U.S. economic conditions driven by fluctuations in interest rates and inflation, wars and other geopolitical hostilities and tensions and changes in trade policies and tariffs, all of which have impacted financial markets and supply chains. While these factors have not had a significant adverse impact on our results of operations, if continued or if they worsen, they could adversely affect our financial condition primarily through our tenants’ financial stability, including their ability or willingness to renew leases, including at increased rental rates, or satisfy lease obligations. Most of our leases require our tenants to be responsible for certain operating expenses, including real estate taxes, insurance and common area maintenance, thereby reducing our exposure to increases in operating expenses resulting from inflation or other factors.

Our portfolio as of March 31, 2026 is summarized below (square feet in thousands):

% of

Weighted

Rentable

Annualized

Average

Ownership

Number of

Square

Rental

Remaining

Vehicle

Ownership

Properties

Location

Feet

Occupancy

Revenues

Lease Term (1)

Mainland Properties

ILPT

100%

88

33 states

21,833 

95.7%

34.1%

5.5

Hawaii Properties

ILPT

100%

226

Hawaii

16,729 

86.2%

28.0%

11.9

Mainland Properties

Mountain JV

61%

94

27 states

20,978 

100.0%

37.6%

5.7

Mainland Properties

Tenancy in common

67%

1

New Jersey

64 

100.0%

0.3%

3.9

Total / weighted average

409

59,604 

94.6%

100.0%

7.4

(1)Based on annualized rental revenues as of March 31, 2026.

Property Operations

Occupancy data for our portfolio as of March 31, 2026 and 2025 were as follows (square feet in thousands):

All Properties

Comparable Properties (1)

as of March 31,

as of March 31,

2026

2025

2026

2025

Total properties

409 

411 

409 

409 

Total rentable square feet

59,604 

59,890 

59,604 

59,604 

Percent leased (2)

94.6

%

94.6

%

94.6

%

94.8

%

(1)Consists of properties that we have owned continuously since January 1, 2025.

(2)Leased square feet is pursuant to existing leases as of March 31, 2026, and includes space being fitted out for occupancy, if any, and space which is leased but is not occupied, if any.

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Table of Contents

The average effective rental rates per square foot represents total rental income divided by the average rentable square feet leased during the periods specified for our properties. For the three months ended March 31, 2026 and 2025, the average effective rental rates per square foot of our properties were as follows:

Three Months Ended March 31,

2026

2025

All properties

$

8.26 

$

7.92 

Comparable properties (1)

$

8.26 

$

7.93 

(1)Consists of properties that we have owned continuously since January 1, 2025.

Mainland Properties. We generally will seek to renew or extend the terms of leases for our Mainland Properties as their expirations approach. A majority of the leases for our Mainland Properties include periodic set dollar amount or percentage increases that increase the cash rent payable to us. Due to the capital that many of the tenants in our Mainland Properties have invested in these properties and because many of these properties appear to be of strategic importance to the tenants’ businesses, we believe that it is likely that these tenants will renew or extend their leases prior to their expirations. If we are unable to extend or renew our leases, it may be time consuming and expensive to relet some of these properties and the terms of any new leases we enter into may be less favorable to us than the terms of our existing leases for those properties.

Hawaii Properties. Revenues from our Hawaii Properties have generally increased as rents under the leases for those properties have been reset or renewed. Lease renewals, lease extensions, new leases and rental rates for our Hawaii Properties in the future will depend on prevailing market conditions when these lease renewals, lease extensions, new leases and rental rates are set. As rent reset dates or lease expirations approach at our Hawaii Properties, we generally negotiate with existing or new tenants for new lease terms. If we are unable to reach an agreement with a tenant on a rent reset, our Hawaii Properties’ leases typically provide that rent is reset based on an appraisal process. Due to the limited availability of land suitable for industrial uses that might compete with our Hawaii Properties, we believe that our Hawaii Properties offer the potential for future rent growth as a result of periodic rent resets, lease extensions and new leasing. Certain of our Hawaii Properties are lands leased for rents that periodically reset based on fair market values, generally every 10 years.

During the three months ended March 31, 2026, we entered into new and renewal leases as summarized in the following table, excluding the impact of rent resets (square feet in thousands):

Three Months Ended March 31, 2026

New Leases

Renewals

Totals

Square feet leased during the period

135 

605 

740 

Weighted average rental rate change (by rentable square feet)

54.2

%

15.5

%

25.2

%

Weighted average lease term by square feet (years)

15.2 

3.5 

5.6 

Total leasing costs and concession commitments (1)

$

617 

$

961 

$

1,578 

Total leasing costs and concession commitments per square foot (1)

$

4.57 

$

1.59 

$

2.13 

Total leasing costs and concession commitments per square foot per year (1)

$

0.30 

$

0.46 

$

0.38 

(1)Includes commitments made for leasing expenditures and concessions, such as leasing commissions, tenant improvements or other tenant inducements.

During the three months ended March 31, 2026, we completed rent resets for approximately 122,000 square feet of land at our Hawaii Properties at rental rates that were 30.6% higher than prior rental rates.

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Table of Contents

The following table provides the annualized rental revenues scheduled to reset at our Hawaii Properties as of March 31, 2026:

Annualized

Rental Revenues

Scheduled to Reset

2026

$

1,656 

2027

814 

2028

— 

2029

8,394 

2030

5,900 

Thereafter

5,764 

Total

$

22,528 

As of March 31, 2026, our remaining lease expirations by year were as follows (square feet in thousands):

Cumulative

% of Total

Cumulative

% of Total

% of Total

Annualized

Annualized

% of Total

Leased

Leased

Leased

Rental

Rental

Annualized

No. of

Square Feet

Square Feet

Square Feet

Revenues

Revenues

Rental Revenues

Year

Leases

Expiring (1)

Expiring (1)

Expiring (1)

Expiring

Expiring

Expiring

2026

20

2,576

4.6%

4.6%

$

14,062

3.1%

3.1%

2027

43

5,613

10.0%

14.6%

37,742

8.4%

11.5%

2028

48

5,303

9.4%

24.0%

42,082

9.3%

20.8%

2029

38

6,937

12.3%

36.3%

45,622

10.1%

30.9%

2030

34

5,450

9.7%

46.0%

40,976

9.1%

40.0%

Thereafter

206

30,487

54.0%

100.0%

270,583

60.0%

100.0%

Total

389

56,366

100.0%

$

451,067

100.0%

Weighted average remaining lease term (years)

6.7

7.4

(1)Leased square feet is pursuant to existing leases as of March 31, 2026, and includes space being fitted out for occupancy, if any, and space which is leased but is not occupied, if any.

As of March 31, 2026, FedEx and Amazon leased 22.7% and 8.1% of our total leased square feet, respectively, and represented 27.7% and 7.6% of our total annualized rental revenues, respectively.

As of March 31, 2026, $16,556, or 3.7%, of our annualized rental revenues were included in leases scheduled to expire by March 31, 2027 and 5.4% of our rentable square feet were vacant. Rental rates for which available space may be leased in the future will depend on prevailing market conditions when lease extensions, lease renewals or new leases are negotiated. Whenever we extend, renew or enter new leases for our properties, we intend to seek rents that are equal to or higher than our historical rents for the same properties. Despite our prior experience with rent resets, lease extensions and new leases in Hawaii, our ability to increase rents when rents reset, leases are extended or leases expire depends upon market conditions, which are beyond our control. Accordingly, we cannot be sure that the historical increases achieved at our Hawaii Properties will continue in the future.

Tenant Review Process. Our manager, RMR, conducts a tenant review process for us. RMR assesses tenants on an individual basis based on various applicable credit criteria. Depending on facts and circumstances, RMR evaluates the creditworthiness of a tenant based on information that is provided by the tenant and, in some cases, information that is publicly available or obtained from third party sources. RMR also may use a third party service to monitor the credit ratings of debt securities of our existing tenants whose debt securities are rated by a nationally recognized credit rating agency.

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Table of Contents

RESULTS OF OPERATIONS

 Three Months Ended March 31, 2026 Compared to Three Months Ended March 31, 2025 (dollars and share amounts in thousands, except per share data)

Comparable (1)

Non-Comparable

Properties Results

Properties Results

Consolidated Properties Results

Three Months Ended

Three Months Ended

Three Months Ended

March 31,

March 31,

March 31,

$

%

$

$

%

2026

2025

Change

Change

2026

2025

Change

2026

2025

Change

Change

Rental income

$

116,419 

$

111,737 

$

4,682 

4.2%

$

— 

$

168 

$

(168)

$

116,419 

$

111,905 

$

4,514 

4.0%

Operating expenses:

Real estate taxes

16,015 

14,116 

1,899 

13.5%

(1)

38 

(39)

16,014 

14,154 

1,860 

13.1%

Other operating expenses

10,055 

10,115 

(60)

(0.6)%

43 

134 

(91)

10,098 

10,249 

(151)

(1.5)%

Total operating expenses

26,070 

24,231 

1,839 

7.6%

42 

172 

(130)

26,112 

24,403 

1,709 

7.0%

Net operating income (2)

$

90,349 

$

87,506 

$

2,843 

3.2%

$

(42)

$

(4)

$

(38)

90,307 

87,502 

2,805 

3.2%

Other expenses:

Depreciation and amortization

40,801 

41,518 

(717)

(1.7)%

General and administrative

9,464 

8,238 

1,226 

14.9%

Total other expenses

50,265 

49,756 

509 

1.0%

Interest income

1,044 

1,968 

(924)

(47.0)%

Interest expense

(61,702)

(69,813)

8,111 

(11.6)%

Loss before income taxes and equity in earnings of unconsolidated joint venture

(20,616)

(30,099)

9,483 

31.5%

Income tax expense

(114)

(28)

(86)

(307.1)%

Equity in earnings (losses) of unconsolidated joint venture

2,871 

(1,042)

3,913 

375.5%

Net loss

(17,859)

(31,169)

13,310 

42.7%

Net loss attributable to noncontrolling interests

8,432 

9,637 

(1,205)

(12.5)%

Net loss attributable to common shareholders

$

(9,427)

$

(21,532)

$

12,105 

56.2%

Weighted average common shares outstanding (basic and diluted)

66,

[Excerpt truncated for page length; source filing is linked above.]

Latest 10-K MD&A

Extracted structurally from real Item 7 body heading to real Item 7A/8 boundary. Confidence: high. Filing date: 2026-02-18. Report date: 2025-12-31.

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following information should be read in conjunction with our consolidated financial statements and accompanying notes included in Part IV, Item 15 of this Annual Report on Form 10-K.

OVERVIEW (dollars in thousands, except per square foot data)

We are a REIT organized under Maryland law. As of December 31, 2025, our portfolio was comprised of 409 properties containing approximately 59,604,000 rentable square feet located in 39 states with 94.5% occupancy leased to approximately 300 different tenants. As of December 31, 2025, we also owned a 22% equity interest in the unconsolidated joint venture.

We believe consumer expectations, long-term growth of e-commerce and modernization of and demand for supply chain resiliency will keep demand for industrial properties strong for the foreseeable future. This continued demand has contributed to favorable market conditions, resulting in positive mark-to-market rents on our lease renewals and new leases. During 2025, there were uncertainties in global and U.S. economic conditions driven by fluctuations in interest rates and inflation, wars and other geopolitical hostilities and tensions, changes in trade policies and tariffs and a U.S. government shutdown, all of which have impacted financial markets and supply chains. While these factors did not have a significant adverse impact on our operations, if continued, they could adversely affect our financial condition primarily through our tenants’ financial stability, including their ability or willingness to renew leases or satisfy lease obligations. Most of our leases require our tenants to be responsible for certain operating expenses, including real estate taxes, insurance and common area maintenance, thereby reducing our exposure to increases in operating expenses resulting from inflation or other factors.

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Table of Contents

Our portfolio as of December 31, 2025 is summarized below (square feet in thousands):

% of

Weighted

Rentable

Annualized

Average

Ownership

Number of

Square

Rental

Remaining

Vehicle

Ownership

Properties

Location

Feet

Occupancy

Revenues

Lease Term (1)

Mainland Properties

ILPT

100%

88

33 states

21,833 

95.7%

34.5%

5.7

Hawaii Properties

ILPT

100%

226

Hawaii

16,729 

85.8%

27.8%

12.2

Mainland Properties

Mountain JV

61%

94

27 states

20,978 

100.0%

37.4%

5.9

Mainland Properties

Tenancy in common

67%

1

New Jersey

64 

98.1%

0.3%

4.1

Total / weighted average

409

59,604 

94.5%

100.0%

7.6

(1)Based on annualized rental revenues as of December 31, 2025.

Property Operations

Occupancy and rental rate data for our portfolio as of December 31, 2025 and 2024 were as follows (square feet in thousands):

All Properties

Comparable Properties

As of December 31,

as of December 31, (1)

2025

2024

2025

2024

Total properties

409 

411 

409 

409 

Total rentable square feet

59,604 

59,890 

59,604 

59,604 

Percent leased (2)

94.5

%

94.4

%

94.5

%

94.6

%

Average effective rental rates per square feet (3)

$

7.96 

$

7.71 

$

7.95 

$

7.73 

(1)Consists of properties that we have owned continuously since January 1, 2024.

(2)Leased square feet is pursuant to existing leases as of December 31, 2025, and includes space being fitted out for occupancy, if any, and space which is leased but is not occupied, if any.

(3)Represents total rental income divided by the average rentable square feet leased during the periods specified for our properties.

Mainland Properties. We generally will seek to renew or extend the terms of leases for our Mainland Properties as their expirations approach. A majority of the leases for our Mainland Properties include periodic set dollar amount or percentage increases that increase the cash rent payable to us. Due to the capital that many of the tenants in our Mainland Properties have invested in these properties and because many of these properties appear to be of strategic importance to the tenants’ businesses, we believe that it is likely that these tenants will renew or extend their leases prior to their expirations. If we are unable to extend or renew our leases, it may be time consuming and expensive to relet some of these properties and the terms of any new leases we enter into may be less favorable to us than the terms of our existing leases for those properties.

Hawaii Properties. Revenues from our Hawaii Properties have generally increased as rents under the leases for those properties have been reset or renewed. Lease renewals, lease extensions, new leases and rental rates for our Hawaii Properties in the future will depend on prevailing market conditions when these lease renewals, lease extensions, new leases and rental rates are set. As rent reset dates or lease expirations approach at our Hawaii Properties, we generally negotiate with existing or new tenants for new lease terms. If we are unable to reach an agreement with a tenant on a rent reset, our Hawaii Properties’ leases typically provide that rent is reset based on an appraisal process. Due to the limited availability of land suitable for industrial uses that might compete with our Hawaii Properties, we believe that our Hawaii Properties offer the potential for future rent growth as a result of periodic rent resets, lease extensions and new leasing. Certain of our Hawaii Properties are lands leased for rents that periodically reset based on fair market values, generally every 10 years.

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Table of Contents

During the year ended December 31, 2025, we entered into new and renewal leases as summarized in the following table, excluding the impact of rent resets (square feet in thousands):

Year Ended December 31, 2025

New Leases

Renewals

Totals

Square feet leased during the period

720 

6,391 

7,111 

Weighted average rental rate change (by rentable square feet)

18.8

%

23.3

%

22.8

%

Weighted average lease term by square feet (years)

6.7 

8.2 

8.1 

Total leasing costs and concession commitments (1)

$

5,297 

$

12,876 

$

18,173 

Total leasing costs and concession commitments per square foot (1)

$

7.36 

$

2.01 

$

2.56 

Total leasing costs and concession commitments per square foot per year (1)

$

1.09 

$

0.25 

$

0.32 

(1)Includes commitments made for leasing expenditures and concessions, such as leasing commissions, tenant improvements or other tenant inducements.

During the year ended December 31, 2025, we completed rent resets for approximately 204,000 square feet of land at our Hawaii Properties at rental rates that were 29.1% higher than prior rental rates.

The following table provides the annualized rental revenues scheduled to reset at our Hawaii Properties as of December 31, 2025:

Annualized

Rental Revenues

Scheduled to Reset

2026

$

1,322 

2027

814 

2028

— 

2029

8,394 

2030

5,900 

Thereafter

5,764 

Total

$

22,194 

As of December 31, 2025, our remaining lease expirations by year were as follows (square feet in thousands):

% of Total

Cumulative

% of Total

Cumulative %

Annualized

% of Total

Leased

Leased

of Total

Annualized

Rental

Annualized

No. of

Square Feet

Square Feet

Square Feet

Rental Revenues

Revenues

Rental Revenues

Year

Leases

Expiring (1)

Expiring (1)

Expiring (1)

Expiring

Expiring

Expiring

2026

28

3,120 

5.5

%

5.5

%

$

16,800 

3.8

%

3.8

%

2027

41

5,697 

10.1

%

15.6

%

35,958 

8.0

%

11.8

%

2028

45

5,037 

8.9

%

24.5

%

40,733 

9.1

%

20.9

%

2029

38

6,937 

12.3

%

36.8

%

45,632 

10.2

%

31.1

%

2030

33

5,341 

9.5

%

46.3

%

39,861 

8.9

%

40.0

%

Thereafter

200

30,166 

53.7

%

100.0

%

267,934 

60.0

%

100.0

%

Total

385

56,298 

100.0

%

$

446,918 

100.0

%

Weighted average remaining lease term (years)

6.9 

7.6 

(1)Leased square feet is pursuant to existing leases as of December 31, 2025, and includes space being fitted out for occupancy, if any, and space which is leased but is not occupied, if any.

As of December 31, 2025, FedEx and Amazon leased 22.7% and 8.1% of our total leased square feet, respectively, and represented 27.9% and 7.3% of our total annualized rental revenues, respectively.

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As of December 31, 2025, $16,800, or 3.8%, of our annualized rental revenues are included in leases scheduled to expire by December 31, 2026 and 5.5% of our rentable square feet were vacant. Rental rates for which available space may be leased in the future will depend on prevailing market conditions when lease extensions, lease renewals or new leases are negotiated. Whenever we extend, renew or enter new leases for our properties, we intend to seek rents that are equal to or higher than our historical rents for the same properties. Despite our prior experience with rent resets, lease extensions and new leases in Hawaii, our ability to increase rents when rents reset, leases are extended or leases expire depends upon market conditions, which are beyond our control. Accordingly, we cannot be sure that the historical increases achieved at our Hawaii Properties will continue in the future.

Tenant Review Process. Our manager, RMR, conducts a tenant review process for us. RMR assesses tenants on an individual basis based on various applicable credit criteria. Depending on facts and circumstances, RMR evaluates the creditworthiness of a tenant based on information that is provided by the tenant and, in some cases, information that is publicly available or obtained from third party sources. RMR also may use a third party service to monitor the credit ratings of debt securities of our existing tenants whose debt securities are rated by a nationally recognized credit rating agency.

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RESULTS OF OPERATIONS

Year Ended December 31, 2025 Compared to Year Ended December 31, 2024 (dollars and share amounts in thousands, except per share data)

Comparable (1)

Non-Comparable

Properties Results

Properties Results

Consolidated Properties Results

Year Ended December 31,

Year Ended December 31,

Year Ended December 31,

$

%

$

$

%

2025

2024

Change

Change

2025

2024

Change

2025

2024

Change

Change

Rental income

$

447,923 

$

441,484 

$

6,439 

1.5 

%

$

925 

$

838 

$

87 

$

448,848 

$

442,322 

$

6,526 

1.5

%

Operating expenses:

Real estate taxes

61,521 

62,418 

(897)

(1.4)

%

158 

145 

13 

61,679 

62,563 

(884)

(1.4)

%

Other operating expenses

36,721 

38,180 

(1,459)

(3.8)

%

335 

367 

(32)

37,056 

38,547 

(1,491)

(3.9)

%

Total operating expenses

98,242 

100,598 

(2,356)

(2.3)

%

493 

512 

(19)

98,735 

101,110 

(2,375)

(2.3)

%

Net operating income (2)

$

349,681 

$

340,886 

$

8,795 

2.6 

%

$

432 

$

326 

$

106 

350,113 

341,212 

8,901 

2.6

%

Other expenses:

Depreciation and amortization

165,227 

171,987 

(6,760)

(3.9)

%

General and administrative

36,961 

30,454 

6,507 

21.4

%

Loss on impairment of real estate

6,081 

— 

6,081 

n/m

Total other expenses

208,269 

202,441 

5,828 

2.9

%

Interest and other income

6,716 

11,427 

(4,711)

(41.2)

%

Interest expense

(264,559)

(292,536)

27,977 

(9.6)

%

Loss on sale of real estate

(1,376)

— 

(1,376)

n/m

Loss on extinguishment of debt

(5,070)

— 

(5,070)

n/m

Loss before income taxes and equity in earnings of unconsolidated joint venture

(122,445)

(142,338)

19,893 

(14.0)

%

Income tax expense

(104)

(162)

58 

(35.8)

%

Equity in earnings of unconsolidated joint venture

19,981 

5,332 

14,649 

274.7 

%

Net loss

(102,568)

(137,168)

34,600 

(25.2)

%

Net loss attributable to noncontrolling interests

36,381 

41,499 

(5,118)

(12.3)

%

Net loss attributable to common shareholders

$

(66,187)

$

(95,669)

$

29,482 

(30.8)

%

Weighted average common shares outstanding (basic and diluted)

66,006 

65,697 

309 

0.5

%

Net loss per share attributable to common shareholders (basic and diluted)

$

(1.00)

$

(1.46)

$

0.46 

(31.5)

%

n/m - not meaningful

(1)Consists of properties that we have owned continuously since January 1, 2024.

(2)See our definition of net operating income, or NOI, and our reconciliation of net loss to NOI below under the heading "Non-GAAP Financial Measures".

References to changes in the income and expense categories below relate to the comparison of results for the year ended December 31, 2025 to the year ended December 31, 2024. For a comparison of consolidated results for the year ended December 31, 2024 to the year ended December 31, 2023, see Part II, Item 7, “Management's Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 2024.

Rental income. Rental income increased primarily due to increases from our net leasing activity and rent resets, partially offset by a decrease in real estate tax reimbursements and vacancies at certain of our properties.

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Real estate taxes. Real estate taxes decreased primarily due to reimbursements received from the prior year during 2025 and lowered assessed values as a result of successful tax appeals at certain of our properties, partially offset by higher tax rates at certain of our properties.

Other operating expenses. The decrease in other operating expenses is primarily due to decreases in insurance expenses and professional fees, partially offset by increases in snow removal and electricity expenses at certain of our properties.

Depreciation and amortization. The decrease in depreciation and amortization primarily reflects the impact of certain acquired real estate leases fully amortizing in 2024, partially offset by increased depreciation related to improvements made to certain of our properties during 2025.

General and administrative. The increase in general and administrative expenses is primarily due to an incentive management fee of $5,679 incurred for 2025, refunds of franchise and transfer taxes during 2024 and an increase in legal fees during 2025.

Loss on impairment of real estate. During 2025, we recognized a loss on impairment of real estate to reduce the carrying value of one held for sale property to its fair value less estimated costs to sell.

Interest and other income. The decrease in interest and other income is primarily due to lower average cash balances and interest rates during 2025 as compared to 2024.

Interest expense. The decrease in interest expense is primarily due to the repayment of our then $1,235,000 loan, or the ILPT Floating Rate Loan, in June 2025 and the discontinuation of hedge accounting for the related interest rate cap. As a result, no further amortization of the related interest rate cap was recognized during 2025. Additionally, amortization of interest rate cap costs of our consolidated joint venture and debt issuance costs decreased during 2025.

Loss on sale of real estate. During 2025, we recognized a net loss on sale of real estate as a result of the sale of two properties in Monaca, PA and Augusta, GA.

Loss on extinguishment of debt. During 2025, we recognized a loss on extinguishment of debt in connection with the repayment of the ILPT Floating Rate Loan.

Income tax expense. Income tax expense reflects state income taxes payable in certain jurisdictions.

Equity in earnings of unconsolidated joint venture. Equity in earnings of unconsolidated joint venture represents the change in the fair value of our investment in the unconsolidated joint venture. The increase in 2025 was primarily due to an increase in the fair value of the underlying real estate owned by the unconsolidated joint venture.

Non-GAAP Financial Measures (dollars in thousands, except per share data)

We present certain “non-GAAP financial measures” within the meaning of the applicable SEC rules including, NOI, FFO attributable to common shareholders and Normalized FFO attributable to common shareholders. These measures do not represent cash generated by operating activities in accordance with GAAP and should not be considered as alternatives to net loss or net loss attributable to common shareholders, as indicators of our operating performance or as measures of our liquidity. These measures should be considered in conjunction with net loss and net loss attributable to common shareholders as presented in our consolidated statements of comprehensive income (loss). We consider these non-GAAP measures to be appropriate supplemental measures of operating performance for a REIT, along with net loss and net loss attributable to common shareholders. We believe 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 our operating performance between periods and with other REITs and, in the case of 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 our properties.

Net Operating Income

We calculate NOI as shown below. We define NOI as income from our rental of real estate less our property operating expenses. The calculation of NOI excludes certain components of net loss in order to provide results that are more closely related to our property level results of operations. NOI excludes depreciation and amortization. We use NOI to evaluate individual and company-wide property level performance. Other real estate companies and REITs may calculate NOI differently than we do.

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The following table presents the reconciliation of net loss to NOI for the years ended December 31, 2025 and 2024:

Year Ended December 31,

2025

2024

Net loss

$

(102,568)

$

(137,168)

Equity in earnings of unconsolidated joint venture

(19,981)

(5,332)

Income tax expense

104 

162 

Loss before income taxes and equity in earnings of unconsolidated joint venture

(122,445)

(142,338)

Loss on extinguishment of debt

5,070 

— 

Loss on sale of real estate

1,376 

— 

Interest expense

264,559 

292,536 

Interest and other income

(6,716)

(11,427)

Loss on impairment of real estate

6,081 

— 

General and administrative

36,961 

30,454 

Depreciation and amortization

165,227 

171,987 

NOI

$

350,113 

$

341,212 

Funds From Operations Attributable to Common Shareholders and Normalized Funds From Operations Attributable to Common Shareholders

We calculate FFO attributable to common shareholders and Normalized FFO attributable to common shareholders as shown below. FFO attributable to common shareholders is calculated on the basis defined by The National Association of Real Estate Investment Trusts, which is: (1) net loss attributable to common shareholders calculated in accordance with GAAP, excluding (i) any recovery or loss on impairment of real estate, (ii) any gain or loss on sale of real estate and (iii) equity in earnings or losses of unconsolidated joint venture; (2) plus (i) real estate depreciation and amortization and (ii) our proportionate share of FFO from unconsolidated joint venture properties; (3) minus FFO adjustments attributable to noncontrolling interests; and (4) certain other adjustments currently not applicable to us. In calculating Normalized FFO attributable to common shareholders, we adjust for certain nonrecurring items shown below, including adjustments for such items related to the unconsolidated joint venture, if any, loss on extinguishment of debt, if any, and incentive management fees, if any.

FFO attributable to common shareholders and Normalized FFO attributable to common shareholders are among the factors considered by our Board of Trustees when determining the amount of distributions to our shareholders. Other factors include, but are not limited to, requirements to maintain our qualification for taxation as a REIT, the then current and expected needs for and availability of cash to pay our obligations and fund our investments, limitations in our debt agreements, the availability to us of debt and equity capital, our dividend yield and our dividend yield compared to the dividend yields of other REITs and our expectation of future capital requirements and operating performance. Other real estate companies and REITs may calculate FFO attributable to common shareholders and Normalized FFO attributable to common shareholders differently than we do.

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The following table presents our calculation of FFO attributable to common shareholders and Normalized FFO attributable to common shareholders and reconciliations of net loss attributable to common shareholders to FFO attributable to common shareholders and Normalized FFO attributable to common shareholders for the years ended December 31, 2025 and 2024.

Year Ended December 31,

2025

2024

Net loss attributable to common shareholders

$

(66,187)

$

(95,669)

Equity in earnings of unconsolidated joint venture

(19,981)

(5,332)

Loss on impairment of real estate

6,081 

— 

Loss on sale of real estate

1,376 

— 

Depreciation and amortization

165,227 

171,987 

Share of FFO from unconsolidated joint venture

6,314 

5,879 

FFO adjustments attributable to noncontrolling interests

(40,018)

(41,510)

FFO attributable to common shareholders

52,812 

35,355 

Incentive management fees

5,679 

— 

Loss on extinguishment of debt

5,070 

— 

Normalized FFO attributable to common shareholders

$

63,561 

$

35,355 

Weighted average common shares outstanding (basic and diluted)

66,006 

65,697 

Per common share data (basic and diluted):

Net loss attributable to common shareholders

$

(1.00)

$

(1.46)

FFO attributable to common shareholders

$

0.80 

$

0.54 

Normalized FFO attributable to common shareholders

$

0.96 

$

0.54 

LIQUIDITY AND CAPITAL RESOURCES (dollars in thousands, except per share and per square foot data)

Our principal sources of funds to meet our operating and capital obligations, pay our debt service obligations and make distributions to our shareholders are rents from tenants at our properties. As of December 31, 2025, investment grade rated tenants, subsidiaries of investment grade rated parent entities or our Hawaii land leases represented 76.3% of our annualized rental revenues and only 3.8% of our annualized rental revenues were from leases expiring over the next 12 months. We believe that these sources of funds will be sufficient to meet our operating and capital obligations, pay our debt service obligations and make distributions to our shareholders for the next 12 months and for the foreseeable future thereafter.

The following is a summary of our sources and uses of cash flows for the periods presented, as reflected in our consolidated statements of cash flows included in Part IV, Item 15 of this Annual Report on Form 10-K:

Year Ended December 31,

2025

2024

Cash and cash equivalents and restricted cash and cash equivalents at beginning of period

$

242,480 

$

245,723 

Net cash provided by (used in):

Operating activities

60,672 

1,963 

Investing activities

3,959 

16,420 

Financing activities

(124,080)

(21,626)

Total

(59,449)

(3,243)

Cash and cash equivalents and restricted cash and cash equivalents at end of period

$

183,031 

$

242,480 

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The increase in net cash from operating activities for the year ended December 31, 2025 compared to 2024 is primarily due to lower interest expense, excluding the impact of settlement of our interest rate caps, and higher cash flows and reimbursements from our properties. The decrease in net cash from investing activities for the year ended December 31, 2025 compared to 2024 is primarily due to a decrease in proceeds from the settlement of interest rate caps and an increase in real estate improvements, partially offset by reduced interest rate cap purchase costs and the sale of two unencumbered vacant properties during 2025. The increase in net cash used in financing activities for the year ended December 31, 2025 compared to 2024 is primarily due to the repayment of the ILPT Floating Rate Loan and increases in debt issuance costs and distributions to common shareholders, partially offset by the net proceeds received from our $1,160,000 mortgage loan.

Our Operating Liquidity and Resources 

Our future cash flows from operating activities will depend primarily upon our ability to:

•collect rents from our tenants when due;

•maintain the occupancy of, and maintain or increase the rental rates at, our properties; and

•control operating cost increases, including interest and other financing costs.

Our Investing and Financing Liquidity and Resources

As of December 31, 2025, we had cash and cash equivalents, excluding restricted cash and cash equivalents, of $94,812. To maintain our qualification for taxation as a REIT under the IRC, we generally are required to distribute at least 90% of our REIT taxable income annually, subject to specified adjustments and excluding any net capital gain. This distribution requirement limits our ability to retain earnings and thereby provide capital for our operations or acquisitions. We may use our cash and cash equivalents on hand, the cash flow from our operations, net proceeds from any sales of assets and net proceeds of any offerings of equity or debt securities to fund our distributions to our shareholders.

As our debt approaches maturity or we desire to reduce our leverage or refinance debt, we may explore refinancing alternatives, property sales or sales of equity interests in joint ventures. Such alternatives may include incurring term debt, obtaining financing secured by mortgages on properties we own, issuing new equity or debt securities, obtaining a revolving credit facility, participating or selling equity interests in joint ventures or selling properties. We may also assume mortgage loans or incur debt in connection with future acquisitions, developments and redevelopments. Although we cannot be sure that we will be successful in completing any particular type of financing, we believe that we will have access to financing, such as debt or equity offerings, to fund capital expenditures, future acquisitions, development, redevelopment and other activities and to pay our obligations.

Disposition Activities

In 2025, we received gross proceeds of $3,900, excluding closing costs, and recognized a net loss on sale of real estate of $1,376 as a result of the sale of two unencumbered vacant properties.

For further information regarding our disposition activities, see Note 3 to our consolidated financial statements included in Part IV, Item 15 of this Annual Report on Form 10-K.

Capital Expenditures

As of December 31, 2025, committed, but unspent, tenant related obligations based on existing leases were $7,578, of which $5,933 is expected to be spent during the next 12 months.

For further information regarding our capital expenditures, see Note 3 to our consolidated financial statements included in Part IV, Item 15 of this Annual Report on Form 10-K.

Joint Ventures

We own a 61% equity interest in our consolidated joint venture. We control this consolidated joint venture and therefore account for the properties owned by this joint venture on a consolidated basis in our consolidated financial statements. We also own a 22% equity interest in the unconsolidated joint venture. We account for the unconsolidated joint venture using the equity method of accounting under the fair value option. The unconsolidated joint venture made aggregate cash distributions to us of $3,960 for each of the years ended December 31, 2025 and 2024.

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For further information regarding these joint ventures, see Note 3 to our consolidated financial statements included in Part IV, Item 15 of this Annual Report on Form 10-K.

Indebtedness

As of December 31, 2025, we had an aggregate principal amount of $4,214,036 of indebtedness, primarily including: (1) our $1,160,000 mortgage loan; (2) our consolidated joint venture’s $1,400,000 loan, or the Mountain Floating Rate Loan; (3) our $700,000 mortgage loan; and (4) our $650,000 mortgage loan, with maturity dates after giving effect to potential exercises of all extension options between 2027 and 2038.

In June 2025, we obtained a $1,160,000 fixed rate, interest only mortgage loan secured by 101 of our properties. This mortgage loan matures in July 2030 and requires that interest be paid at an annual rate of 6.40%. Subject to the satisfaction of certain conditions, we have the option to prepay our $1,160,000 mortgage loan in full or in part with a premium prior to January 9, 2030 and at par with no premium on or after January 9, 2030. We used the net proceeds from our $1,160,000 mortgage loan and cash on hand to repay in full the ILPT Floating Rate Loan. The ILPT Floating Rate Loan was secured by 104 of our properties, was scheduled to mature in October 2025 and required that interest be paid at an annual rate of secured overnight financing rate, or SOFR, plus a weighted average premium of 3.93%. During year ended December 31, 2025, we recognized a $5,070 loss on extinguishment of debt related to the repayment of the ILPT Floating Rate Loan.

The Mountain Floating Rate Loan is secured by 82 properties, matures in March 2026, subject to one remaining one-year extension option, and requires that interest be paid at an annual rate of SOFR plus a premium of 2.77%. In March 2025, our consolidated joint venture exercised the second of its three, one-year extension options for the maturity date of this loan. In connection with the exercise of the extension, our consolidated joint venture purchased a one-year interest rate cap for $15,010 with a SOFR strike rate equal to 3.10%, which replaced the previous interest rate cap with a SOFR strike rate equal to 3.04%. Subject to the satisfaction of certain conditions, our consolidated joint venture has the option to prepay the Mountain Floating Rate Loan in full or in part at any time at par with no premium. The weighted average interest rates under the Mountain Floating Rate Loan were 5.85% and 5.88% for the years ended December 31, 2025 and 2024, respectively.

The agreements and related documents governing our $1,160,000 mortgage loan, the Mountain Floating Rate Loan, our $700,000 mortgage loan and our $650,000 mortgage loan contain customary covenants, provide for acceleration of payment of all amounts due thereunder upon the occurrence and continuation of certain events of default and, in the case of the $650,000 mortgage loan, also require us to maintain a minimum consolidated net worth of at least $250,000 and liquidity of at least $15,000. As of December 31, 2025, we believe that we were in compliance with all of the covenants and other terms under the agreements governing these loans.

For further information regarding our indebtedness and historical weighted average interest rates under our floating rate loans, see Notes 5 and 11 to our consolidated financial statements included in Part IV, Item 15 of this Annual Report on Form 10-K.

Distributions

During the year ended December 31, 2025, we paid regular quarterly distributions to common shareholders totaling $7,973 using cash on hand.

On January 15, 2026, we declared a regular quarterly distribution to common shareholders of record on January 26, 2026 of $0.05 per share, or approximately $3,333. We expect to pay this distribution on or about February 19, 2026 using cash on hand.

Related Person Transactions

We have relationships and historical and continuing transactions with RMR, RMR Inc. and others related to them. For further information about these and other such relationships and related person transactions, see Notes 9 and 10 to our consolidated financial statements included in Part IV, Item 15 of this Annual Report on Form 10-K, our other filings with the SEC, including our definitive Proxy Statement for our 2026 Annual Meeting of Shareholders, or our definitive Proxy Statement, to be filed with the SEC within 120 days after the fiscal year ended December 31, 2025. For further information about the risks that may arise as a result of these and other related person transactions and relationships, see elsewhere in this Annual Report on Form 10-K, including “Warning Concerning Forward-Looking Statements”, Part I, Item 1, “Business” and Part I, Item 1A, “Risk Factors.” We may engage in additional transactions with related persons, including businesses to which RMR or its subsidiaries provide management services.

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Critical Accounting Estimates

Our critical accounting estimates are those that will have the most impact on the reporting of our financial condition and results of operations and those requiring significant judgments and estimates. We believe that our judgments and estimates have been and will be consistently applied and produce financial information that fairly presents our results of operations. Our most critical accounting estimates involve our investments in real property. These estimates affect our:

•allocation of purchase prices for property acquisitions between various asset categories, including allocations to above and below market leases and the related impact on the recognition of rental income and depreciation and amortization expenses; and

•assessment of the carrying values and impairments of our properties.

We allocate the cost of each property acquired to various property components and each component generally has a different useful life. We record building, land and improvements, and, if applicable, the value of in-place leases, the fair market value of above or below market leases and tenant relationships at their relative fair value. We base purchase price allocations and the determination of useful lives on our estimates and, under some circumstances, studies from independent real estate appraisers to provide market information and evaluations that are relevant to our purchase price allocations and determinations of useful lives; however, our management is ultimately responsible for the purchase price allocations and determination of useful lives.

We compute depreciation expense using the straight line method over estimated useful lives of up to 40 years for buildings and improvements, and up to seven years for personal property. We do not depreciate the allocated cost of land. We amortize above market lease values as a reduction to rental income over the terms of the respective leases. We amortize below market lease values as an increase to rental income over the terms of the respective leases. We amortize the value of acquired in-place leases, exclusive of the value of above market and below market acquired in-place leases, to depreciation and amortization over the periods of the respective leases. If a lease is terminated prior to its stated expiration, all unamortized amounts relating to that lease are amortized in full at that time. Purchase price allocations require us to make certain assumptions and estimates. Incorrect assumptions and estimates may result in inaccurate rental income and depreciation and amortization over future periods.

We periodically evaluate our properties for impairment. Impairment indicators may include declining tenant occupancy, our concerns about a tenant's financial condition (which may be affected by a rent default or other information which comes to our attention) or our decision to dispose of an asset before the end of its estimated useful life and legislative, as well as market or industry changes that could permanently reduce the value of a property. If indicators of impairment are present, we evaluate the carrying value of the related property by comparing it to the expected future undiscounted cash flows to be generated from that property. If the sum of these expected future cash flows is less than the carrying value, we reduce the net carrying value of the property to its fair value. This analysis requires us to judge whether indicators of impairment exist and to estimate likely future cash flows. The future net undiscounted cash flows are subjective and are based in part on assumptions regarding hold periods, market rents and terminal capitalization rates. If we misjudge or estimate incorrectly or if future tenant operations, market or industry factors differ from our expectations, we may record an impairment that is inappropriate or fail to record an impairment when we should have done so, or the amount of any such impairment may be inaccurate.

These accounting estimates involve significant judgments made based upon our experience and the experience of our management and our Board of Trustees, including judgments about current valuations, ultimate realizable value, estimated useful lives, salvage or residual value, the ability and willingness of our tenants to perform their obligations to us, current and future economic conditions and competitive factors in the markets in which our properties are located. Competition, economic conditions and other factors may cause occupancy declines in the future. In the future, we may need to revise our carrying value assessments to incorporate information which is not now known, and such revisions could increase or decrease our depreciation expense related to properties we own or decrease the carrying values of our assets.

Impact of Climate Change

Concerns about climate change have resulted in various treaties, laws and regulations that are intended to limit carbon emissions and address other environmental concerns. These and other laws may cause energy or other costs at our properties to increase. We do not expect the direct impact of these increases to be material to our results of operations because the increased costs either would be the responsibility of our tenants directly or in the longer term, passed through and paid by tenants of our properties. Although we do not believe it is likely in the foreseeable future, laws enacted to mitigate climate change may make some of our properties obsolete or cause us to make material investments in our properties, which could materially and adversely affect our financial condition or the financial condition of our tenants and their ability to pay rent to us.

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In an effort to reduce the effects of any increased energy costs in the future, we continuously study ways to improve the energy efficiency at all of our properties. Our property manager, RMR, is a member of the ENERGY STAR program, a joint program of the U.S. Environmental Protection Agency and the U.S. Department of Energy that is focused on promoting energy efficiency at commercial properties through its “ENERGY STAR” partner program, and a member of the U.S. Green Building Council, a nonprofit organization focused on promoting energy efficiency at commercial properties through its leadership in energy and environmental design, or LEED®, green building program. RMR’s annual Sustainability Report summarizes the ESG initiatives of RMR and its client companies, including us. RMR's Sustainability Report may be accessed on RMR Inc.'s website at www.rmrgroup.com/corporate-sustainability/default.aspx. The information on or accessible through RMR Inc.'s website is not incorporated into this Annual Report on Form 10-K.

Some observers believe severe weather in different parts of the world over the last few years is evidence of global climate change. Severe weather may have an adverse effect on certain properties we own. Rising sea levels could cause flooding at some of our properties, including some of our Hawaii Properties, which may have an adverse effect on individual properties we own. We mitigate these risks by procuring, or requiring our tenants to procure, insurance coverage we believe adequate to protect us from material damages and losses resulting from the consequences of losses caused by climate change. However, we cannot be sure that our mitigation efforts will be sufficient or that future storms, rising sea levels or other changes that may occur due to future climate change could not have a material adverse effect on our financial results.