Office Properties Income Trust · OTC:OPITQ
Office Properties Income Trust — Q1 2024 Earnings Presentation
32 slides from Office Properties Income Trust's earnings presentation, May 1, 2024
Slide 1: First Quarter 2024 Financial Results and Supplemental Information
Provo, UT Exhibit 99.2 Office Properties Income Trust First Quarter 2024 Financial Results and Supplemental Information May 1, 2024
Slide 2: Table of Contents
Table of Contents QUARTERLY RESULTS Office Properties Income Trust Announces First Quarter 2024 Financial Results ............................................................ 4 First Quarter 2024 Highlights .............................................................................................
Slide 3: Quarterly Results
Quarterly Results RETURN TO TABLE OF CONTENTS Q1 2024 3
Slide 4: Office Properties Income Trust Announces First Quarter 2024 Financial Results
OFFICE PROPERTIES INCOME TRUST ANNOUNCES FIRST QUARTER 2024 FINANCIAL RESULTS “Despite significant operational headwinds that Newton, MA (May 1, 2024). Office Properties Income Trust (Nasdaq: OPI) today announced its financial results for the quarter ended March 31, 2024. continue to impact the offi
Slide 5: First Quarter 2024 Highlights
First Quarter 2024 Highlights • Executed 488,000 square feet of total leasing at rental rates that were 10.2% higher than prior rental rates for the same space and a weighted average lease term of 9.3 years. • Lease renewals accounted for more than 90% of leasing activity, driven by U.S. government
Slide 6: Financials
Financials RETURN TO TABLE OF CONTENTS Q1 2024 6
Slide 7: Key Financial Data
Key Financial Data (dollars in thousands, except per share data) As of and for the Three Months Ended As of 3/31/2024 12/31/2023 9/30/2023 6/30/2023 3/31/2023 3/31/2024 Selected Income Statement Data: Capitalization: Rental income (1) $ 139,435 $ 133,773 $ 133,361 $ 133,997 $ 132,422 Total common sh
Slide 8: Condensed Consolidated Statements of Income (Loss)
Condensed Consolidated Statements of Income (Loss) (amounts in thousands, except per share data) Three Months Ended March 31, 2024 2023 Rental income $ 139,435 $ 132,422 San Diego, CA Expenses: Real estate taxes 15,709 15,333 Utility expenses 8,151 7,260 Other operating expenses 27,327 26,057 Deprec
Slide 9: Condensed Consolidated Balance Sheets
Condensed Consolidated Balance Sheets (dollars in thousands, except per share data) March 31, December 31, 2024 2023 ASSETS Real estate properties: Washington, D.C. Land $ 782,660 $ 786,310 Buildings and improvements 3,296,591 3,279,369 Total real estate properties, gross 4,079,251 4,065,679 Accumul
Slide 10: Debt Summary
Debt Summary As of March 31, 2024 (dollars in thousands) Coupon Interest Principal Maturity Due at Years to Rate (3) Rate (4) Balance Date Maturity Maturity Secured Floating Rate Debt: $325,000 secured revolving credit facility (1) 8.910% 8.910% $ 190,000 1/29/2027 $ 190,000 2.8 $100,000 secured ter
Slide 11: Debt Maturity Schedule
Debt Maturity Schedule As of March 31, 2024 (dollars in thousands) $1,000,000 Secured vs. Unsecured Debt Secured 29.2% $800,000 $353,833 Unsecured 70.8% $600,000 $290,000 Fixed vs. Variable Rate Debt $400,000 Variable $650,000 11.0% $562,000 $200,000 $350,000 $300,000 $123,487 Fixed 89.0% $0 2024 20
Slide 12: Leverage Ratios, Coverage Ratios and Public Debt Covenants
Leverage Ratios, Coverage Ratios and Public Debt Covenants As of and for the Three Months Ended 3/31/2024 12/31/2023 9/30/2023 6/30/2023 3/31/2023 Leverage Ratios: Net debt / total gross assets 56.2% 55.6% 54.9% 54.7% 54.1% Net debt / gross book value of real estate assets 50.1% 49.3% 49.1% 48.9% 48
Slide 13: Capital Expenditures Summary and Significant Redevelopment Information
Capital Expenditures Summary and Significant Redevelopment Information (dollars and sq. ft. in thousands, except per sq. ft. data) Capital Expenditures Summary For the Three Months Ended 3/31/2024 12/31/2023 9/30/2023 6/30/2023 3/31/2023 Atlanta, GA Lease related costs $ 16,768 $ 18,497 $ 15,677 $ 2
Slide 14: Property Dispositions
Property Dispositions Since January 1, 2024 (dollars and sq. ft. in thousands, except per sq. ft. data) Dispositions: Number of Gross Sales Price Date Sold Location Properties Sq. Ft. Gross Sales Price Per Sq. Ft. 3/21/2024 Chicago, IL 1 248 $ 38,500 $ 155.24 Sterling, VA RETURN TO TABLE OF CONTENTS
Slide 15: Investments in Unconsolidated Joint Ventures
Investments in Unconsolidated Joint Ventures As of March 31, 2024 (dollars and sq. ft. in thousands) (1) In March 2024, this joint venture did not have Unconsolidated Joint Ventures: sufficient cash flow to pay its monthly debt service, resulting in an event of default. OPI OPI Number of Weighted Av
Slide 16: Portfolio Information
Portfolio Information RETURN TO TABLE OF CONTENTS Q1 2024 16
Slide 17: Summary Same Property Results
Summary Same Property Results (dollars and sq. ft. in thousands) For the Three Months Ended 3/31/2024 3/31/2023 Columbia, MD Properties (end of period) 145 145 Rentable sq. ft. 19,134 19,169 Percent leased 88.2% 94.2% Rental income $ 120,681 $ 127,553 Same Property NOI $ 73,319 $ 81,658 Same Propert
Slide 18: Occupancy and Leasing Summary
Occupancy and Leasing Summary (dollars and sq. ft. in thousands, except per sq. ft. data) As of and for the Three Months Ended 3/31/2024 12/31/2023 9/30/2023 6/30/2023 3/31/2023 Properties (end of period) 151 152 154 155 157 Rentable sq. ft. 20,293 20,541 20,705 20,784 20,895 Percentage leased 85.6%
Slide 19: Tenant Diversity and Credit Characteristics
Tenant Diversity and Credit Characteristics As of March 31, 2024 Percentage of Total Annualized Rental Income Tenant Industry Tenant Credit Characteristics Other: 2.2% Energy Services: Non-Investment Hospitality: 1.7% Grade 2.3% 5.1% Life Sciences and Medical: 3.1% Government Contractors: 7.2% US Go
Slide 20: Tenants Representing 1% or More of Total Annualized Rental Income
Tenants Representing 1% or More of Total Annualized Rental Income As of March 31, 2024 (dollars and sq. ft. in thousands) % of Total % of Leased Annualized Annualized Tenant Credit Rating Sq. Ft. Sq. Ft. Rental Income Rental Income 1 U.S. Government Investment Grade 3,534 20.3% $ 100,747 20.2% 2 Alp
Slide 21: Lease Expiration Schedule
Lease Expiration Schedule As of March 31, 2024 (dollars and sq. ft. in thousands) Cumulative Cumulative % of Total % of Total % of Total % of Total Number of Leased Square Leased Leased Annualized Annualized Annualized Leases Feet Square Feet Square Feet Rental Income Rental Income Rental Income Yea
Slide 22: Appendix
Appendix RETURN TO TABLE OF CONTENTS Q1 2024 22
Slide 23: Company Profile and Research Coverage
Company Profile and Research Coverage The Company: Equity Research Coverage OPI is included in 152 market indices and comprises more than 1% of the following indices as of March 31, 2024: Bloomberg US Micro Cap Real Estate B. Riley Securities, Inc. Morgan Stanley Price Return Index (BMICR), BI North
Slide 24: Governance Information
Governance Information Board of Trustees Donna D. Fraiche Barbara D. Gilmore John L. Harrington Independent Trustee Independent Trustee Independent Trustee William A. Lamkin Elena B. Poptodorova Jeffrey P. Somers Independent Trustee Lead Independent Trustee Independent Trustee Mark A. Talley Jennife
Slide 25: Calculation and Reconciliation of NOI and Cash Basis NOI
Calculation and Reconciliation of NOI and Cash Basis NOI (dollars in thousands) For the Three Months Ended 3/31/2024 12/31/2023 9/30/2023 6/30/2023 3/31/2023 Calculation of NOI and Cash Basis NOI: Rental income $ 139,435 $ 133,773 $ 133,361 $ 133,997 $ 132,422 Property operating expenses (51,187) (5
Slide 26: Reconciliation and Calculation of Same Property NOI and Same Property Cash Basis NOI
Reconciliation and Calculation of Same Property NOI and Same Property Cash Basis NOI (dollars in thousands) For the Three Months Ended 3/31/2024 3/31/2023 Reconciliation of NOI to Same Property NOI: Rental income $ 139,435 $ 132,422 Atlanta, GA Property operating expenses (51,187) (48,650) NOI 88,24
Slide 27: Operating Metrics by Collateral Pool
Operating Metrics by Collateral Pool As of March 31, 2024 (dollars and sq. ft. in thousands) Sq. Ft. Trailing Expiring Weighted Trailing Twelve Unspent Through Average Annualized Twelve Months Leasing Gross Book Number of March 31, Remaining Rental Months Cash Basis Related Value of Real Properties
Slide 28: Calculation of EBITDA, EBITDAre and Adjusted EBITDAre
Calculation of EBITDA, EBITDAre and Adjusted EBITDAre (dollars in thousands) For the Three Months Ended 3/31/2024 12/31/2023 9/30/2023 6/30/2023 3/31/2023 Net loss $ (5,184) $ (37,151) $ (19,593) $ (12,242) $ (446) Add (less): Interest expense 35,476 30,056 28,835 26,525 25,231 Income tax expense 56
Slide 29: Calculation of FFO, Normalized FFO and CAD
Calculation of FFO, Normalized FFO and CAD (amounts in thousands, except per share data) For the Three Months Ended 3/31/2024 12/31/2023 9/30/2023 6/30/2023 3/31/2023 Net loss $ (5,184) $ (37,151) $ (19,593) $ (12,242) $ (446) Add (less): Depreciation and amortization: Consolidated properties 50,341
Slide 30: Non-GAAP Financial Measures and Certain Definitions
Non-GAAP Financial Measures and Certain Definitions 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 the SEC, including NOI, Cash Basis NOI, Same Property NOI, Same Property Cash Ba
Slide 31: Non-GAAP Financial Measures and Certain Definitions (Continued)
Non-GAAP Financial Measures and Certain Definitions (Continued) Adjusted total assets and total unencumbered assets include the original cost of real estate assets calculated in accordance with GAAP before impairment writedowns, if any, and exclude depreciation and amortization, accounts receivable
Slide 32: Warning Concerning Forward-Looking Statements
Warning Concerning Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other securities laws that are subject to risks and uncertainties. These statements may include words such as “believe”,
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