UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2014

or

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from              to             

Commission file number: 333-184126

Industrial Property Trust Inc.

(Exact name of registrant as specified in its charter)

Maryland	61-1577639
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
518 Seventeenth Street, 17th Floor Denver, CO	80202
(Address of principal executive offices)	(Zip Code)

(303) 228-2200

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act (Check one):

Large accelerated filer	¨	Accelerated filer	¨
Non-accelerated filer	¨	Smaller reporting company	x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ¨    No  x

As of November 5, 2014, there were 17,928,702 shares of the registrant’s common stock outstanding.

INDUSTRIAL PROPERTY TRUST INC.

TABLE OF CONTENTS

		Page
PART I. FINANCIAL INFORMATION
Item 1.	Financial Statements:
	Condensed Consolidated Balance Sheets as of September 30, 2014  (unaudited) and December 31, 2013		3
	Condensed Consolidated Statements of Operations for the Three and Nine Months Ended September 30, 2014 and 2013 (unaudited)		4
	Condensed Consolidated Statement of Equity for the Nine Months Ended September 30, 2014 (unaudited)		5
	Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2014  and 2013 (unaudited)		6
	Notes to Condensed Consolidated Financial Statements (unaudited)		7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		18
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		27
Item 4.	Controls and Procedures		27
PART II. OTHER INFORMATION
Item 1A.	Risk Factors		28
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		30
Item 6.	Exhibits		31

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

INDUSTRIAL PROPERTY TRUST INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except per share data)	September 30,   2014		December 31,   2013
	(unaudited)
ASSETS
Net investment in real estate properties	$	148,086	$	-
Cash and cash equivalents		10,748		2,871
Straight-line and tenant receivables		283		-
Deferred financing costs, net		650		-
Acquisition deposits		1,973		213
Due from affiliates		343		287
Due from transfer agent		1,198		450
Other assets		1,127		231
Total assets	$	164,408	$	4,052
LIABILITIES AND EQUITY
Liabilities
Accounts payable and accrued expenses	$	1,008	$	391
Debt		30,000		-
Due to affiliates		143		75
Dividends payable		1,899		32
Intangible lease liabilities, net		1,542		-
Other liabilities		887		-
Total liabilities		35,479		498
Commitments and contingencies (Note 9)
Equity
Stockholders’ equity:
Preferred stock, $0.01 par value - 200,000 shares authorized, none issued and outstanding		-		-
Common stock, $0.01 par value - 1,500,000 shares authorized, 15,341 and 420 shares issued and outstanding, respectively		153		4
Additional paid-in capital		135,741		3,815
Accumulated deficit		(6,966)		(266)
Total stockholders’ equity		128,928		3,553
Noncontrolling interests		1		1
Total equity		128,929		3,554
Total liabilities and equity	$	164,408	$	4,052

See accompanying Notes to Condensed Consolidated Financial Statements.

3

INDUSTRIAL PROPERTY TRUST INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

	For the Three Months				For the Nine Months
	Ended September 30,				Ended September 30,
(in thousands, except per share data)	2014		2013		2014		2013
Revenues:
Rental revenues	$	1,503	$	-	$	2,378	$	-
Total revenues		1,503		-		2,378		-
Operating expenses:
Rental expenses		381		-		614		-
Real estate-related depreciation and amortization		793		-		1,233		-
General and administrative expenses		554		87		1,480		87
Organization expenses, related party		-		40		17		40
Asset management fees, related party		186		-		290		-
Acquisition expenses, related party		1,638		-		2,947		-
Acquisition expenses		1,093		1		1,731		1
Total operating expenses		4,645		128		8,312		128
Operating loss		(3,142)		(128)		(5,934)		(128)
Other expense:
Interest expense		158		1		457		1
Total other expense		158		1		457		1
Net expenses before expense support from Advisor		4,803		129		8,769		129
Expense support from Advisor		1,160		-		2,517		-
Net expenses after expense support from Advisor		3,643		129		6,252		129
Net loss		(2,140)		(129)		(3,874)		(129)
Net loss attributable to noncontrolling interests		-		-		-		-
Net loss attributable to common stockholders	$	(2,140)	$	(129)	$	(3,874)	$	(129)
Weighted-average shares outstanding		11,645		80		5,957		40
Net loss per common share - basic and diluted	$	(0.18)	$	(1.61)	$	(0.65)	$	(3.22)

See accompanying Notes to Condensed Consolidated Financial Statements.

4

INDUSTRIAL PROPERTY TRUST INC.

CONDENSED CONSOLIDATED STATEMENT OF EQUITY

(Unaudited)

	Stockholders’ Equity
					Additional
	Common Stock				Paid-In		Accumulated		Noncontrolling		Total
(in thousands)	Shares		Amount		Capital		Deficit		Interests		Equity
Balance as of December 31, 2013		420	$	4	$	3,815	$	(266)	$	1	$	3,554
Net loss		-		-		-		(3,874)		-		(3,874)
Issuance of common stock		14,921		149		148,653		-		-		148,802
Share-based compensation		-		-		176		-		-		176
Offering costs		-		-		(16,903)		-		-		(16,903)
Dividends to stockholders		-		-		-		(2,826)		-		(2,826)
Balance as of September 30, 2014		15,341	$	153	$	135,741	$	(6,966)	$	1	$	128,929

See accompanying Notes to Condensed Consolidated Financial Statements.

5

INDUSTRIAL PROPERTY TRUST INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	For the Nine Months
	Ended September 30,
(in thousands)	2014		2013
Operating activities:
Net loss	$	(3,874)	$	(129)
Adjustments to reconcile net loss to net cash used in operating activities:
Real estate-related depreciation and amortization		1,233		-
Straight-line rent and amortization of above- and below-market leases		(229)		-
Share-based compensation		176		-
Amortization of loan costs and other		188		19
Changes in operating assets and liabilities:
Tenant receivables and other assets		(938)		(66)
Accounts payable and accrued expenses and other liabilities		1,027		15
Net cash used in operating activities		(2,417)		(161)
Investing activities:
Real estate acquisitions		(146,689)		-
Acquisition deposits		(1,973)		-
Capital expenditures		(499)		-
Net cash used in investing activities		(149,161)		-
Financing activities:
Proceeds from line of credit		45,700		-
Repayments of line of credit		(15,700)		-
Financing costs paid		(837)		-
Proceeds from issuance of common stock		141,398		2,000
Offering costs for issuance of common stock		(10,703)		-
Cash distributions paid to common stockholders		(403)		-
Net cash provided by financing activities		159,455		2,000
Net increase in cash and cash equivalents		7,877		1,839
Cash and cash equivalents, at beginning of period		2,871		201
Cash and cash equivalents, at end of period	$	10,748	$	2,040
Supplemental disclosure of cash flow information:
Offering proceeds due from transfer agent	$	1,198	$	-
Dividends payable		1,899		-
Stock dividends issued		257		-
Distributions reinvested in common stock		299		-
Financing of directors’ and officers’ insurance		178		267

See accompanying Notes to Condensed Consolidated Financial Statements.

6

INDUSTRIAL PROPERTY TRUST INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. BASIS OF PRESENTATION

Unless the context otherwise requires, the “Company” refers to Industrial Property Trust Inc. and its consolidated subsidiaries.

The accompanying unaudited condensed consolidated financial statements included herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Accordingly, certain disclosures normally included in the annual audited financial statements prepared in accordance with accounting principles generally accepted in the U.S. (“GAAP”) have been omitted. As such, the accompanying unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013, filed with the SEC on March 7, 2014 (“2013 Form 10-K”).

In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all adjustments and eliminations, consisting only of normal recurring adjustments necessary for a fair presentation in conformity with GAAP.

Recent Accounting Standards

In April 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-08, “Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity” (“ASU 2014-08”), which changes the criteria at which a disposal will qualify as a discontinued operation and requires new disclosure of both discontinued operations and certain other disposals that do not meet the definition of a discontinued operation. Under the revised standard, the definition of discontinued operations has been changed so that only disposals of components that represent strategic shifts qualify for discontinued operations reporting. As permitted, the Company adopted ASU 2014-08 early, and it became effective for the Company for the quarter ended March 31, 2014. The adoption of this standard did not have an impact on the Company’s results of operations, financial position or liquidity.

In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”), which provides guidance for revenue recognition and supersedes the revenue recognition requirements in Topic 605, “Revenue Recognition.” The standard is based on the principle that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. ASU 2014-09 also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. The new guidance specifically excludes revenue derived from lease contracts from its scope. The standard will be effective for the Company in the first quarter of fiscal year 2017. Early adoption is not permitted. The Company is currently evaluating the impact of the adoption of this standard on its consolidated financial statements.

2. ACQUISITIONS

The Company acquired 100% of the following properties during the nine months ended September 30, 2014:

								Intangibles
										Above-		Below-
			Number					Intangible		Market		Market		Total
	Acquisition		of					Lease		Lease		Lease		Purchase
($ in thousands)	Date		Buildings	Land		Building		Assets		Assets		Liabilities		Price (1)
West Valley Distribution Center		1/15/2014	1	$	3,051	$	4,241	$	657	$	85	$	(182)	$	7,852
Century Distribution Center		3/17/2014	1		2,854		8,102		824		-		(268)		11,512
Oakesdale Commerce Center		3/28/2014	1		1,483		2,214		304		-		-		4,001
Medley Distribution Center		5/9/2014	1		1,090		2,601		423		-		(54)		4,060
Rialto Distribution Center		6/6/2014	1		6,575		12,965		1,363		-		(953)		19,950
Palm Beach Commerce Center		6/20/2014	1		1,425		4,955		820		-		-		7,200
Windham Industrial Center		6/30/2014	1		2,808		7,493		696		-		(97)		10,900
Meadows Distribution Center		9/4/2014	1		1,686		6,043		242		-		-		7,971
Corridor Industrial Center		9/16/2014	1		4,247		4,795		868		15		(44)		9,881
O’Hare Distribution Center		9/17/2014	1		11,140		13,347		2,048		415		-		26,950
Lehigh Valley Commerce Center		9/25/2014	1		1,545		3,940		516		-		-		6,001
Corridor Industrial Center II		9/29/2014	3		11,500		13,135		2,180		41		(59)		26,797
Bolingbrook Industrial Center		9/30/2014	1		1,124		2,136		510		317		-		4,087
Total acquisitions			15	$	50,528	$	85,967	$	11,451	$	873	$	(1,657)	$	147,162

(1) Total purchase price equals consideration paid. The purchase price allocations are preliminary based on the Company’s estimate of the fair value determined from all available information at the time of acquisition and, therefore, are subject to change upon the completion of the

7

Company’s analysis of appraisals, evaluation of the credit quality of customers, and working capital adjustments within the measurement period, which will not exceed 12 months from the acquisition date. The Company does not expect future revisions, if any, to have a significant impact on its financial position or results of operations.

Intangible lease assets and above-market lease assets are amortized over the remaining lease term. Below-market lease liabilities are amortized over the remaining lease term, plus any below-market, fixed-rate renewal option periods. The weighted-average amortization periods for the intangible assets and liabilities acquired in connection with these acquisitions, as of the date of acquisition, were as follows:

Property	Intangibles, net
	(years)
West Valley Distribution Center	3.8
Century Distribution Center	10.0
Oakesdale Commerce Center	3.0
Medley Distribution Center	3.0
Rialto Distribution Center	7.7
Palm Beach Commerce Center	9.1
Windham Industrial Center	2.2
Meadows Distribution Center	10.8
Corridor Industrial Center	7.2
O’Hare Distribution Center	4.3
Lehigh Valley Commerce Center	5.0
Corridor Industrial Center II	2.7
Bolingbrook Industrial Center	4.6

Pro Forma Financial Information (Unaudited)

The table below includes the following: (i) actual revenues and net loss of the 2014 acquisitions (described above) included in the Company’s condensed consolidated statements of operations for the three and nine months ended September 30, 2014 and (ii) pro forma revenues and net income (loss) reflecting the 2014 acquisitions, as if the date of each acquisition had been January 1, 2013. The pro forma financial information is not intended to represent or be indicative of the Company’s consolidated financial results that would have been reported had the acquisitions been completed at the beginning of the comparable prior period presented and should not be taken as indicative of its future consolidated financial results.

	For the Three Months				For the Nine Months
	Ended September 30,				Ended September 30,
(in thousands)	2014		2013		2014		2013
Actual:
Total revenues	$	1,503	$	-	$	2,378	$	-
Net loss	$	(383)	$	-	$	(572)	$	-
Pro forma:
Total revenues (1)	$	3,012	$	3,012	$	9,096	$	9,096
Net income (loss) (2)	$	864	$	414	$	1,813	$	(3,422)

(1) The pro forma total revenues were adjusted to include incremental revenue of $1.5 million and $3.0 million for the three months ended September 30, 2014 and 2013, respectively, and $6.7 million and $9.1 million for the nine months ended September 30, 2014 and 2013, respectively. The incremental rental revenue was determined based on the acquired property’s historical rental revenue and the purchase accounting entries and includes: (i) the incremental base rent adjustments calculated based on the terms of the acquired leases and presented on a straight-line basis and (ii) the incremental reimbursement and other revenue adjustments, which consist primarily of rental expense recoveries, and are determined based on the acquired customer’s historical reimbursement and other revenue.

(2) The pro forma net income was adjusted to exclude acquisition-related expenses of $2.7 million for the three months ended September 30, 2014, and $4.7 million for the nine months ended September 30, 2014. For the nine months ended September 30, 2013, the pro forma net loss was adjusted to include acquisition-related expenses of $4.7 million relating to the 2014 acquisitions, as if these expenses had been incurred as of January 1, 2013. There were no adjustments related to acquisition-related expenses for the three months ended September 30, 2013, as there were no acquisition-related expenses incurred for that period.

8

3. INVESTMENT IN REAL ESTATE PROPERTIES

As of September 30, 2014, the Company’s portfolio consisted of 15 industrial buildings totaling approximately 1.9 million square feet. As of December 31, 2013, the Company did not own any properties.

	September 30,		December 31,
(in thousands)	2014		2013
Land	$	50,528	$	-
Building and improvements		86,488		-
Intangible lease assets		12,324		-
Investment in real estate properties		149,340		-
Less accumulated depreciation and amortization		(1,254)		-
Net investment in real estate properties	$	148,086	$	-

Intangible Lease Assets and Liabilities

Intangible lease assets and liabilities included the following:

	September 30, 2014						December 31, 2013
			Accumulated						Accumulated
(in thousands)	Gross		Amortization		Net		Gross		Amortization		Net
Intangible lease assets	$	11,451	$	(604)	$	10,847	$	-	$	-	$	-
Above-market lease assets		873		(21)		852		-		-		-
Below-market lease liabilities		(1,657)		115		(1,542)		-		-		-

The following table details the estimated net amortization of such intangible lease assets and liabilities, as of September 30, 2014, for the next five years and thereafter:

	Estimated Net Amortization
	Intangible		Above-Market		Below-Market
(in thousands)	Lease Assets		Lease Assets		Lease Liabilities
Remainder of 2014	$	417	$	20	$	(68)
2015		2,630		207		(263)
2016		2,075		189		(233)
2017		1,843		188		(224)
2018		1,543		184		(196)
Thereafter		2,339		64		(558)
Total	$	10,847	$	852	$	(1,542)

Future Minimum Rent

Future minimum base rental payments, which equal the cash basis of monthly contractual rent owed to the Company from its customers under the terms of non-cancelable operating leases in effect as of September 30, 2014, excluding rental revenues from the potential renewal or replacement of existing future leases and from tenant reimbursement revenue, were as follows for the next five years and thereafter:

	Future Minimum Base
(in thousands)	Rental Payments
Remainder of 2014	$	3,033
2015		12,385
2016		11,993
2017		11,029
2018		10,205
Thereafter		24,296
Total	$	72,941

9

Rental Revenue and Depreciation and Amortization Expense

The following table summarizes straight-line rent adjustments, amortization recognized as an increase (decrease) to rental revenues from above-and below-market lease assets and liabilities, and real-estate related depreciation and amortization expense:

	For the Three Months				For the Nine Months
	Ended September 30,				Ended September 30,
(in thousands)	2014		2013		2014		2013
Increase (Decrease) to Rental Revenue:
Straight-line rent adjustments	$	71	$	-	$	135	$	-
Above-market lease amortization		(13)		-		(21)		-
Below-market lease amortization		74		-		115		-
Real Estate-Related Depreciation and Amortization:
Depreciation expense	$	405	$	-	$	629	$	-
Intangible lease asset amortization		388		-		604		-

4. DEBT

In January 2014, the Company entered into a revolving credit agreement, as amended, with an initial aggregate commitment of $100.0 million. The Company has the ability to expand the commitment up to a maximum aggregate amount of $400.0 million, subject to certain conditions and receiving bank commitments. The line of credit matures in January 2017, and may be extended pursuant to two one-year extension options, subject to certain conditions. The primary interest rate is variable and calculated based on one-month London Interbank Offered Rate (“LIBOR”) plus a margin ranging from 1.90% to 2.75%, or an alternative base rate plus a margin of 0.90% to 1.75%. The line of credit is available for general corporate purposes, including but not limited to the acquisition, development and operation of industrial properties and other permitted investments. As of September 30, 2014, the Company had $30.0 million outstanding under the line of credit with an interest rate of 2.06%; the unused portion was $70.0 million, of which $62.6 million was available.

The Company’s line of credit contains various property level covenants, including customary affirmative and negative covenants. In addition, the line of credit contains certain corporate level financial covenants, including leverage ratio, fixed charge coverage ratio, and tangible net worth thresholds. The Company was in compliance with all debt covenants as of September 30, 2014.

5. FAIR VALUE

Fair value measurements are determined based on the assumptions that market participants would use in pricing the asset or liability. Fair value measurements are categorized into one of three levels of the fair value hierarchy based on the lowest level of significant input used. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset or liability. Considerable judgment and a high degree of subjectivity are involved in developing these estimates. These estimates may differ from the actual amounts that the Company could realize upon settlement.

The fair value hierarchy is as follows:

Level 1—Quoted (unadjusted) prices in active markets for identical assets or liabilities.

Level 2—Other observable inputs, either directly or indirectly, other than quoted prices included in Level 1, including:

• Quoted prices for similar assets/liabilities in active markets;

• Quoted prices for identical or similar assets/liabilities in non-active markets (e.g., few transactions, limited information, non-current prices, high variability over time);

• Inputs other than quoted prices that are observable for the asset/liability (e.g., interest rates, yield curves, volatilities, default rates); and

• Inputs that are derived principally from or corroborated by other observable market data.

Level 3—Unobservable inputs that cannot be corroborated by observable market data.

10

The table below includes the fair value for the Company’s financial instrument for which it is practicable to estimate fair value. The carrying value and fair value of the line of credit was as follows:

	September 30, 2014				December 31, 2013
	Carrying		Fair		Carrying		Fair
(in thousands)	Value		Value		Value		Value
Line of credit	$	30,000	$	30,000	$	-	$	-

The following are the methods and assumptions used to estimate the fair value:

Line of Credit. The fair value of the line of credit is estimated using discounted cash flow methods based on the Company’s estimate of market interest rates, which the Company has determined to be its best estimate of current market spreads over comparable term benchmark rates of similar instruments. Credit spreads relating to the underlying instruments are based on Level 3 inputs.

The fair values of cash and cash equivalents, tenant receivables, due from/to affiliates, accounts payable, and dividends payable approximate their carrying values because of the short-term nature of these instruments. As such, these assets and liabilities are not listed in the carrying value and fair value table above.

6. STOCKHOLDERS’ EQUITY

Initial Public Offering

On September 27, 2012, the Company filed a registration statement with the SEC on Form S-11 in connection with the initial public offering of up to $2.0 billion in shares of common stock (the “Offering”). The registration statement was subsequently declared effective on July 24, 2013. Pursuant to the registration statement for the Offering, the Company is offering for sale up to $1.5 billion in shares of common stock at a price of $10.00 per share, and up to $500.0 million in shares under the Company’s distribution reinvestment plan at a price of $9.50 per share. The Company has the right to reallocate the shares of common stock offered between the Company’s primary offering and the Company’s distribution reinvestment plan. Dividend Capital Securities LLC (the “Dealer Manager”) provides dealer manager services in connection with the Offering. The Offering is a best efforts offering, which means that the Dealer Manager is not required to sell any specific number or dollar amount of shares of common stock in the Offering, but will use its best efforts to sell the shares of common stock. The Offering is a continuous offering that will end no later than two years after the effective date of the Offering, or July 24, 2015, unless extended for up to an additional one and a half year period by the Company’s board of directors, subject to applicable regulatory requirements.

As of September 30, 2014, the Company had raised gross proceeds of $152.8 million from the sale of 15.3 million shares of its common stock in the Offering, including shares issued under the Company’s distribution reinvestment plan, and had raised sufficient offering proceeds to satisfy the minimum offering requirements for the Offering with respect to all states. As of that date, 187.3 million shares remained available for sale pursuant to the Offering, including 52.6 million shares available for sale through the Company’s distribution reinvestment plan.

Dividends

The Company intends to accrue and make cash distributions on a quarterly basis. In addition to the cash distributions, the Company’s board of directors had authorized special daily stock dividends to all common stockholders of record as of the close of business on each day for the first, second and third quarters of 2014 in an amount equal to 0.000047945 of a share of common stock on each outstanding share of common stock (which is equal to a quarterly distribution rate of $0.04375 based on the $10.00 per share Offering price). Quarterly cash distributions and stock dividends for each stockholder are calculated for each day the stockholder has been a stockholder of record during such quarter. Cash distributions for stockholders participating in the Company’s distribution reinvestment plan will be reinvested into shares of the Company’s common stock.

11

Cash Distributions. The following table summarizes the Company’s cash distribution activity (including cash distributions reinvested in shares of the Company’s common stock):

		Amount
		Declared per		Paid		Reinvested		Total
(in thousands, except per share data)	Payment Date	Common Share		in Cash		in Shares		Distributions
2014
September 30	October 15, 2014	$	0.11875	$	710	$	674	$	1,384
June 30	July 15, 2014		0.11250		300		258		558
March 31	April 15, 2014		0.11250		74		38		112
Total				$	1,084	$	970	$	2,054
2013
December 31	January 15, 2014	$	0.11250	$	29	$	3	$	32
September 30 (1)	December 20, 2013		0.11250		7		-		7
Total				$	36	$	3	$	39

(1) Cash distributions were authorized to all common stockholders of record as of the close of business on each day commencing on the date that the Company met the minimum offering requirements in connection with the Offering and ending on the last day of the quarter in which the minimum offering requirements were met (the “Initial Quarter”). Accordingly, the Initial Quarter commenced on September 6, 2013 and ended on September 30, 2013.

Stock Dividends. The following table summarizes the Company’s stock dividend activity:

Quarter	Issuance Date	Shares		Amount (1)
September 30, 2014	October 1, 2014		51,500	$	515,000
June 30, 2014	July 1, 2014		21,600		216,000
March 31, 2014	April 1, 2014		4,100		41,000
Total			77,200	$	772,000

(1) Amount based on the $10.00 per share Offering price.

Redemptions

As of September 30, 2014, the Company had not received any eligible redemption requests nor redeemed any shares of its common stock.

7. SHARE-BASED COMPENSATION

The Company’s Equity Incentive Plan, effective as of July 16, 2013 (the “Equity Incentive Plan”), provides for the grant of options, stock appreciation rights, restricted stock, restricted stock units, dividend equivalent rights or other share-based awards. Directors, officers, and employees (if any) of the Company, as well as any advisor or consultant, including employees of Industrial Property Advisors LLC (the “Advisor”) and the property manager, are eligible to receive awards under the Equity Incentive Plan; provided that, the individual is performing bona fide advisory or consulting services for the Company, the services provided by the individual are not in connection with the offer or sale of securities in a capital raising transaction, and do no directly or indirectly promote or maintain a market for the Company’s common stock. The Company has registered a total of 5.0 million shares of common stock for issuance pursuant to the Equity Incentive Plan, subject to certain adjustments set forth in the plan.

For the nine months ended September 30, 2014, the Company granted an aggregate of 25,500 shares of restricted stock to the Company’s independent directors under the Equity Incentive Plan. Of this amount, 15,000 shares immediately vested and 10,500 shares vest over the next nine months.

The Company accounts for share-based compensation related to the restricted stock issued to certain eligible individuals using the fair value based methodology, which is based upon the stock price on the vesting date and requires the amount of related expense to be adjusted to the fair value of the award at the end of each reporting period until the awards have fully vested. Share-based compensation expense for the restricted stock is amortized using a graded vesting attribution method and is recognized in general and administrative expenses in the Company’s condensed consolidated statements of operations.

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The following table summarizes the Company’s activity with respect to the issuance of restricted stock pursuant to the Equity Incentive Plan for the nine months ended September 30, 2014:

			Weighted-Average
(shares in thousands)	Shares		Fair Value per Share (1)
Nonvested shares at beginning of period		-	$	-
Granted		26	$	10.00
Vested		(15)	$	10.00
Forfeited		-	$	-
Nonvested shares at end of period		11	$	10.00

(1) Based on the Company’s primary offering price in the Offering of $10.00 per share on the grant date.

The following table summarizes other share-based compensation data:

	For the Three Months				For the Nine Months
	Ended September 30,				Ended September 30,
(in thousands, except per share data)	2014		2013		2014		2013
Share-based compensation expense	$	26	$	-	$	176	$	-
Total fair value of restricted stock vested	$	-	$	-	$	150	$	-
Weighted-average grant date fair value of restricted stock granted, per share (1)	$	10.00	$	-	$	10.00	$	-

(1) Based on the Company’s primary offering price in the Offering of $10.00 per share on the grant date.

As of September 30, 2014, the aggregate unrecognized compensation cost related to the restricted stock was approximately $0.1 million and is expected to be fully recognized over a weighted-average period of 0.4 years.

8. RELATED PARTY TRANSACTIONS

The Company relies on the Advisor, a related party, to manage the Company’s day-to-day operating and acquisition activities and to implement the Company’s investment strategy pursuant to the terms of an amended and restated advisory agreement (the “Advisory Agreement”), dated July 16, 2014, by and among the Company, Industrial Property Operating Partnership LP (the “Operating Partnership”), and the Advisor. The Advisor is considered to be a related party of the Company because certain indirect owners and officers of the Advisor serve as directors and/or executive officers of the Company. The Dealer Manager, also a related party, provides dealer manager services in connection with the Offering. The Advisor and Dealer Manager receive compensation in the form of fees and expense reimbursements for services relating to the Offering and for the investment and management of the Company’s assets. The following summarizes the fees and expense reimbursements incurred for the three and nine months ended September 30, 2014 and 2013:

Sales Commissions. Sales commissions are payable to the Dealer Manager, all of which may be reallowed to participating unaffiliated broker dealers, and are equal to up to 7.0% of the gross proceeds from the Offering.

Dealer Manager Fees. Dealer manager fees are payable to the Dealer Manager and are equal to up to 2.5% of the gross proceeds from the Offering.

Acquisition Fees. Acquisition fees are payable to the Advisor in connection with the acquisition of real property, and will vary depending on whether the Advisor provides development services or development oversight services, each as described below, in connection with the acquisition (including, but not limited to, forward commitment acquisitions) or stabilization (including, but not limited to, development and value add transactions) of such real property, or both. The Company refers to such properties for which the Advisor provides development services or development oversight services as development real properties. For each real property acquired for which the Advisor does not provide development services or development oversight services, the acquisition fee is an amount equal to 2.0% of the total purchase price of the properties acquired (or the Company’s proportional interest therein), until such time as the Company has invested an aggregate amount of $500.0 million in such properties, at which time the acquisition fee will be reduced to 1.0% of the total purchase price of the properties acquired (or the Company’s proportional interest therein), including in all instances real property held in joint ventures or co-ownership arrangements. In connection with providing services related to the development, construction, improvement or stabilization, including tenant improvements, of development real properties, which the Company refers to collectively as development services, or overseeing the provision of these services by third parties on the Company’s behalf, which the Company refers to as development oversight services, the acquisition fee, which the Company refers to as the development acquisition fee, will equal up to 4.0% of total project cost, including debt, whether borrowed or assumed (or the Company’s proportional interest therein with respect to real properties held in joint ventures or co-ownership arrangements). If the Advisor engages a third party to provide development services directly to the Company, the third party will be compensated directly by the Company and the Advisor will receive the development acquisition fee if it provides the development oversight services.

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Asset Management Fees. Asset management fees consist of a monthly fee of one-twelfth of 0.80% of the aggregate cost (including debt, whether borrowed or assumed, and before non-cash reserves and depreciation) of each real property asset within the Company’s portfolio (or the Company’s proportional interest therein with respect to real estate property held in joint ventures, co-ownership arrangements or real estate-related entities in which the Company owns a majority economic interest or that the Company consolidates for financial reporting purposes in accordance with GAAP).

Organization and Offering Expenses. The Company reimburses the Advisor or its affiliates for cumulative organization expenses and for cumulative expenses of its public offerings up to 2.0% of the aggregate gross offering proceeds from the sale of shares in its public offerings. The Advisor or an affiliate of the Advisor is responsible for the payment of the Company’s cumulative organization expenses and offering expenses to the extent that such cumulative expenses exceed the 2.0% organization and offering expense reimbursement for the Company’s public offerings, without recourse against or reimbursement by the Company. Organization and offering expenses are accrued by the Company only to the extent that the Company is successful in raising gross offering proceeds. If the Company is not successful in raising additional amounts of offering proceeds, no additional amounts will be payable by the Company to the Advisor for reimbursement of cumulative organization and offering expenses. Organization costs are expensed in the period they become reimbursable and offering costs are recorded as a reduction of gross offering proceeds in additional paid-in capital.

Other Expense Reimbursements. In addition to the reimbursement of organization and offering expenses, the Company is also obligated, subject to certain limitations, to reimburse the Advisor for certain costs incurred by the Advisor or its affiliates, such as personnel and overhead expenses, in connection with the services provided to the Company under the Advisory Agreement, provided that the Advisor does not receive a specific fee for the activities which generate the expenses to be reimbursed. The Advisor may utilize its officers to provide such services and in certain instances those individuals may include the Company’s principal executive officer and principal financial officer.

The table below summarizes the fees and expenses incurred by the Company for services provided by the Advisor and the Dealer Manager related to the services described above, and any related amounts payable:

	Incurred
	For the Three Months				For the Nine Months				Payable as of
	Ended September 30,				Ended September 30,				September 30,		December 31,
(in thousands)	2014		2013		2014		2013		2014		2013
Expensed:
Organization costs (1)	$	-	$	40	$	17	$	40	$	-	$	9
Acquisition fees		1,638		-		2,947		-		-		-
Asset management fees		186		-		290		-		-		-
Other expense reimbursements		30		-		107		-		18		42
Total	$	1,854	$	40	$	3,361	$	40	$	18	$	51
Additional Paid-In Capital:
Sales commissions	$	5,346	$	-	$	10,250	$	-	$	66	$	32
Dealer manager fees		1,930		-		3,706		-		41		11
Offering costs (1)		1,543		-		2,947		-		37		-
Total	$	8,819	$	-	$	16,903	$	-	$	144	$	43

(1) As of September 30, 2014, the Advisor had incurred $8.2 million of offering costs and $93,000 of organization costs, all of which were paid directly by the Advisor on behalf of the Company. As of September 30, 2014, the Company had reimbursed the Advisor $2.9 million related to offering costs and $93,000 related to organization costs. The Company reimburses the Advisor or its affiliates for cumulative organization expenses and for cumulative expenses of its public offerings up to 2.0% of the aggregate gross offering proceeds from the sale of shares in its public offerings. The Advisor or an affiliate of the Advisor is responsible for the payment of the Company’s cumulative organization expenses and offering expenses to the extent that such cumulative expenses exceed 2.0% of the gross offering proceeds from the sale of shares in the Company’s public offerings, without recourse against or reimbursement by the Company.

Expense Support Agreement

Effective as of July 1, 2014, the Company entered into an Amended and Restated Expense Support and Conditional Reimbursement Agreement (the “Amended and Restated Expense Support Agreement”) with the Operating Partnership and the Advisor. The Amended and Restated Expense Support Agreement amended and restated the prior agreement which was in effect for each quarter between October 1, 2013 and June 30, 2014 (the “Original Expense Support Agreement”). The Amended and Restated Expense Support Agreement extended the term of the agreement through June 30, 2015, and amended the definition of “Baseline Distributions” in connection with the previously announced increase in the quarterly cash distribution rate for the third quarter of 2014 from $0.11250 per share to $0.11875 per share.

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Effective October 1, 2014, the Company entered into a Second Amended and Restated Expense Support and Conditional Reimbursement Agreement (the “Second Amended and Restated Expense Support Agreement”) with the Operating Partnership and the Advisor, in order to amend the definition of Baseline Distributions in connection with the previously announced increase in the quarterly cash distribution rate for the fourth quarter of 2014 from $0.11875 per share to $0.1250 per share. Under the Second Amended and Restated Expense Support Agreement, for each quarter in the period from October 1, 2014 through June 30, 2015, Baseline Distributions are equal to the aggregate cash distributions that would have been declared for such quarter assuming daily distributions at the quarterly rate of $0.1250 per share of common stock.

Pursuant to the Second Amended and Restated Expense Support Agreement, the Advisor has agreed to defer payment of all or a portion of the asset management fee otherwise payable to it pursuant to the Advisory Agreement if Company-defined funds from operations, as disclosed in the Company’s quarterly and annual reports (“CDFFO”), for a particular quarter is less than the “Baseline Distributions” for such quarter. “Baseline Distributions” means the aggregate distributions that would have been declared for such quarter assuming daily distributions at the quarterly rate of $0.11250 per share of common stock with respect to the third and fourth quarters of 2013 and the first and second quarters of 2014 (which is the rate at which the Company declared distributions for such quarters), $0.11875 per share of common stock for the third quarter of 2014 (which is the rate at which the Company declared distributions for that quarter) and $0.1250 for the period October 1, 2014 through June 30, 2015 (which is the rate at which the Company has declared distributions for the fourth quarter of 2014). The amount of the asset management fee that will be deferred for a particular quarter, if any, will equal the lesser of (i) the difference between the CDFFO and Baseline Distributions for such quarter and (ii) the entire asset management fee payable to the Advisor pursuant to the Advisory Agreement for such quarter.

In addition, pursuant to the Second Amended and Restated Expense Support Agreement, the Advisor, in its sole discretion, may elect to fund certain expenses of the Company and the Operating Partnership as expense support payments. If, in any quarter, the Advisor elects to fund an expense support payment equal to the difference between the CDFFO and the Baseline Distributions less any deferred asset management fees for that quarter, then the Company, the Advisor, and the Operating Partnership will enter into a separate quarterly agreement for the provision of expense support with respect to such quarter.

Subject to certain conditions, the Advisor is entitled to reimbursement from the Company for any asset management fees that are deferred and any expense support payments that the Advisor makes pursuant to the Second Amended and Restated Expense Support Agreement; provided that, the Company will not be obligated to reimburse the Advisor for any amount not reimbursed by the Company to the Advisor within three years after the quarter in which such reimbursable amount originated. For any quarter in which CDFFO exceeds the Baseline Distributions for that quarter, the Second Amended and Restated Expense Support Agreement requires that the Company reimburse the Advisor in an amount equal to the lesser of (i) the difference between the CDFFO and the Baseline Distributions and (ii) the sum of all outstanding reimbursable amounts. The Company’s obligation to reimburse the Advisor is non-interest bearing.

Pursuant to the Second Amended and Restated Expense Support Agreement, the Company may use cash flow from operations to pay distributions to its stockholders that would otherwise be used to pay asset management fees or expenses. Although the Second Amended and Restated Expense Support Agreement has an effective term through June 30, 2015, it may be terminated prior thereto without cause or penalty by either the Advisor or a majority of our independent directors, in each case upon 60 days’ written notice to the other party. In addition, the Advisor’s obligations under the Second Amended and Restated Expense Support Agreement will immediately terminate upon the earlier to occur of (i) the termination or non-renewal of the Advisory Agreement, (ii) the delivery by the Company of notice to the Advisor of the Company’s intention to terminate or not renew the Advisory Agreement or (iii) the Company’s completion of a liquidity event. When the Second Amended and Restated Expense Support Agreement terminates, the Advisor will not have an obligation to defer fees in order to support the Company’s distributions. Notwithstanding the foregoing, amounts deferred or reimbursed pursuant to the Second Amended and Restated Expense Support Agreement will survive any termination or expiration and remain subject to the reimbursement terms described above without modification or acceleration.

The table below provides information regarding expense support payment obligations incurred by the Advisor:

	For the Three		For the Nine
	Months Ended		Months Ended
(in thousands)	September 30, 2014		September 30, 2014
Asset management fees	$	186	$	290
Other expense support		974		2,227
Total expense support from the Advisor (1)	$	1,160	$	2,517

(1) As of September 30, 2014, approximately $361,000 was related to expense support to be reimbursed by the Advisor, and was recorded as due from affiliates on the condensed consolidated balance sheets.

The cumulative amount that is potentially reimbursable to the Advisor pursuant to the expense support agreements was $2.8 million as of September 30, 2014.

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9. COMMITMENTS AND CONTINGENCIES

The Company and the Operating Partnership are not presently involved in any material litigation nor, to the Company’s knowledge, is any material litigation threatened against the Company or its investments.

Environmental Matters

A majority of the properties the Company acquires are subject to environmental reviews either by the Company or the previous owners. In addition, the Company may incur environmental remediation costs associated with certain land parcels it may acquire in connection with the development of land. The Company has acquired certain properties in urban and industrial areas that may have been leased to or previously owned by commercial and industrial companies that discharged hazardous material. The Company may purchase various environmental insurance policies to mitigate its exposure to environmental liabilities. The Company is not aware of any environmental liabilities that it believes would have a material adverse effect on its business, financial condition, or results of operations as of September 30, 2014.

10. SUBSEQUENT EVENTS

Status of Offering

As of November 5, 2014, the Company had raised gross proceeds of $178.6 million from the sale of 17.9 million shares of its common stock in its public offering, including shares issued under the Company’s distribution reinvestment plan. As of that date, 184.7 million shares remained available for sale pursuant to the Offering, including 52.5 million shares available for sale through the Company’s distribution reinvestment plan.

Distribution Increase

The Company’s board of directors has authorized daily cash distributions at a quarterly rate of $0.1250 per share of common stock for the fourth quarter of 2014, which is an increase of $0.00625 per share, or an increase of 5.3% compared to the prior quarterly cash distribution rate.

Completed Acquisitions

Normal Junction Commerce Center. On October 21, 2014, the Company acquired two industrial buildings totaling approximately 140,000 square feet. These buildings are located in the Phoenix market and are 79% leased to four customers with a weighted-average remaining lease term (based on square feet) of 5.5 years. The total purchase price was $12.5 million, exclusive of transfer taxes, due diligence expenses and other closing costs. The Company funded this acquisition with proceeds from the Offering. Pursuant to the terms of the Advisory Agreement, the Company paid an acquisition fee of $0.2 million to the Advisor in connection with this acquisition.

Mechanicsburg Distribution Center. On October 23, 2014, the Company acquired one industrial building totaling approximately 147,000 square feet. This building is located in the Pennsylvania market and is 100% leased to one customer with a remaining lease term of 5.2 years. The total purchase price was $8.4 million, exclusive of transfer taxes, due diligence expenses and other closing costs. The Company funded this acquisition with proceeds from the Offering and borrowings under the Company’s corporate line of credit. Pursuant to the terms of the Advisory Agreement, the Company paid an acquisition fee of $0.2 million to the Advisor in connection with this acquisition.

West Valley Distribution Center II. On October 24, 2014, the Company acquired two industrial buildings totaling approximately 70,000 square feet. These buildings are located in the Seattle / Tacoma market and are 78% leased to seven customers with a weighted-average remaining lease term (based on square feet) of 2.0 years. The total purchase price was $5.9 million, exclusive of transfer taxes, due diligence expenses and other closing costs. The Company funded this acquisition with proceeds from the Offering and borrowings under the Company’s corporate line of credit. Pursuant to the terms of the Advisory Agreement, the Company paid an acquisition fee of $0.1 million to the Advisor in connection with this acquisition.

CentrePort Distribution Center. On October 31, 2014, the Company acquired one industrial building totaling approximately 310,000 square feet. This building is located in the Dallas market and is 100% leased to one customer with a remaining lease term of 2.7 years. The total purchase price was $16.7 million, exclusive of transfer taxes, due diligence expenses and other closing costs. The Company funded this acquisition with proceeds from the Offering and borrowings under the Company’s corporate line of credit. Pursuant to the terms of the Advisory Agreement, the Company paid an acquisition fee of $0.3 million to the Advisor in connection with this acquisition.

Tacoma Commerce Center. On October 31, 2014, the Company acquired one industrial building totaling approximately 50,000 square feet. This building is located in the Seattle / Tacoma market and is 90% leased to two customers with a weighted-average remaining lease term (based on square feet) of 3.5 years. The total purchase price was $3.4 million, exclusive of transfer taxes, due diligence expenses and other closing costs. The Company funded this acquisition with proceeds from the Offering and borrowings under the Company’s corporate line of credit. Pursuant to the terms of the Advisory Agreement, the Company paid an acquisition fee of $0.1 million to the Advisor in connection with this acquisition.

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Richmond Distribution Center. On October 31, 2014, the Company acquired one industrial building totaling approximately 245,000 square feet. This building is located in the San Francisco market and is 100% leased to two customers with a weighted-average remaining lease term (based on square feet) of 0.8 years. The total purchase price was $18.4 million, exclusive of transfer taxes, due diligence expenses and other closing costs. The Company funded this acquisition with proceeds from the Offering and borrowings under the Company’s corporate line of credit. Pursuant to the terms of the Advisory Agreement, the Company paid an acquisition fee of $0.4 million to the Advisor in connection with this acquisition.

The allocations of the purchase price for each of the completed acquisitions described above have not been completed as of the date of this report and will be based on the Company’s estimate of the fair value determined from all available information. The allocation of the purchase price will be finalized within the measurement period, which will not exceed 12 months from the acquisition date.

Acquisitions Under Contract

8A Distribution Center. On October 15, 2014, the Company entered into a purchase agreement to acquire one industrial building totaling approximately 293,000 square feet located in the New Jersey market. The building is currently partially leased to one customer under a lease that expires in November 2016. The total purchase price is expected to be approximately $23.5 million, exclusive of transfer taxes, due diligence expenses and other closing costs. In connection with the execution of the purchase agreement, the Company deposited $0.5 million into an escrow account. This acquisition is expected to close during the first quarter of 2015, but there can be no assurance the acquisition will be completed.

Dallas Distribution Portfolio. On October 31, 2014, the Company entered into a purchase agreement to acquire three recently completed industrial buildings totaling approximately 1.3 million square feet located in the Dallas market. This portfolio is a recently completed development opportunity in a targeted top-tier industrial market, and is 12% leased to one customer with a remaining lease term of 4.5 years. The total purchase price is expected to be approximately $74.6 million, exclusive of transfer taxes, due diligence expenses and other closing costs. In connection with the execution of the purchase agreement, the Company deposited $2.0 million into an escrow account. This acquisition is expected to close during the fourth quarter of 2014, but there can be no assurance the acquisition will be completed.

Pursuant to the terms of the Advisory Agreement, the Company expects to pay an acquisition fee to the Advisor equal to 2.0% of the purchase price of each of the acquisitions under contract described above. The Company plans to fund these acquisitions using proceeds from the Offering and debt financing. The consummation of these acquisitions is subject to the Company’s completion of due diligence and various closing conditions to be met by the parties. If the Company does not close on these acquisitions, there are circumstances under which it may forfeit its respective deposits.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

References to the terms “we,” “our,” or “us” refer to Industrial Property Trust Inc. and its consolidated subsidiaries. The following discussion and analysis should be read together with our unaudited condensed consolidated financial statements and notes thereto included in this Quarterly Report on Form 10-Q.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q includes certain statements that may be deemed forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Such forward-looking statements relate to, without limitation, rent and occupancy growth, general conditions in the geographic area where we operate, our future debt and financial position, our future capital expenditures, future distributions and acquisitions (including the amount and nature thereof), other developments and trends of the real estate industry, business strategies and the expansion and growth of our operations. Forward-looking statements are generally identifiable by the use of the words “may,” “will,” “should,” “expect,” “could,” “intend,” “plan,” “anticipate,” “estimate,” “believe,” “continue,” “project,” or the negative of these words or other comparable terminology. These statements are not guarantees of future performance, and involve certain risks, uncertainties and assumptions that are difficult to predict.

The forward-looking statements included herein are based upon our current expectations, plans, estimates, assumptions, and beliefs that involve numerous risks and uncertainties. Assumptions relating to the foregoing involve judgments with respect to, among other things, future economic, competitive and market conditions, and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond our control. Although we believe that the expectations reflected in such forward-looking statements are based on reasonable assumptions, our actual results and performance could differ materially from those set forth in the forward-looking statements. Factors that could have a material adverse effect on our operations and future prospects include, but are not limited to:

• Our ability to raise proceeds in our initial public offering and effectively deploy the proceeds raised in our initial public offering in accordance with our investment strategy and objectives;

• The failure of acquisitions to perform as we expect;

• Our failure to successfully integrate acquired properties and operations;

• Unexpected delays or increased costs associated with any development projects;

• The availability of cash flows from operating activities for distributions and capital expenditures;

• Defaults on or non-renewal of leases by customers, lease renewals at lower than expected rent, or failure to lease properties at all or on favorable rents and terms;

• Difficulties in economic conditions generally and the real estate, debt, and securities markets specifically;

• Legislative or regulatory changes, including changes to the laws governing the taxation of real estate investment trusts (“REITs”);

• Our failure to obtain, renew, or extend necessary financing or access the debt or equity markets;

• Conflicts of interest arising out of our relationships with Industrial Property Advisors Group LLC (the “Sponsor”), the Advisor, and their affiliates;

• Risks associated with using debt to fund our business activities, including re-financing and interest rate risks;

• Increases in interest rates, operating costs, or greater than expected capital expenditures;

• Changes to GAAP; and

• Our ability to qualify as a REIT.

Any of the assumptions underlying forward-looking statements could prove to be inaccurate. Our stockholders are cautioned not to place undue reliance on any forward-looking statements included in this Quarterly Report on Form 10-Q. All forward-looking statements are made as of the date of this Quarterly Report on Form 10-Q and the risk that actual results will differ materially from the expectations expressed in this Quarterly Report on Form 10-Q will increase with the passage of time. Except as otherwise required by the federal securities laws, we undertake no obligation to publicly update or revise any forward-looking statements after the date of this Quarterly Report on Form 10-Q, whether as a result of new information, future events, changed circumstances, or any other reason. In light of the significant uncertainties inherent in the forward-looking statements included in this Quarterly Report on Form 10-Q, including, without limitation, the risks described under “Risk Factors,” the inclusion of such forward-looking statements should not be regarded as a representation by us or any other person that the objectives and plans set forth in this Quarterly Report on Form 10-Q will be achieved.

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OVERVIEW

General

Industrial Property Trust Inc. was formed on August 28, 2012 to make investments in income-producing real estate assets consisting primarily of high-quality distribution warehouses and other industrial properties that are leased to creditworthy corporate customers. We have operated and elected to be treated as a REIT for U.S. federal income tax purposes, commencing with the taxable year that ended on December 31, 2013, and we intend to continue to operate in accordance with the requirements for qualification as a REIT. We utilize an Umbrella Partnership Real Estate Investment Trust (“UPREIT”) organizational structure to hold all or substantially all of our assets through the Operating Partnership.

On July 24, 2013, we commenced an initial public offering of up to $2.0 billion in shares of our common stock, including $1.5 billion in shares of common stock offered at a price of $10.00 per share and $500.0 million in shares offered under our distribution reinvestment plan at a price of $9.50 per share. On September 6, 2013, we broke escrow for the Offering, and effectively commenced operations. As of September 30, 2014, we had raised gross proceeds of $152.8 million from the sale of 15.3 million shares of our common stock in the Offering, including shares issued under our distribution reinvestment plan. As of that date, 187.3 million shares remained available for sale pursuant to the Offering, including 52.6 million shares available for sale through our distribution reinvestment plan. See “Note 6 to the Condensed Consolidated Financial Statements” for information concerning our initial public offering.

As of September 30, 2014, we owned a portfolio that included 15 industrial buildings totaling approximately 1.9 million square feet in eight major U.S. industrial markets with 35 customers and a weighted-average remaining lease term (based on square feet) of 5.3 years. Our portfolio was 99.6% leased as of September 30, 2014.

We have used, and we intend to continue to use, the net proceeds from the Offering primarily to make investments in real estate assets. We may use the net proceeds from the Offering to make other real estate-related investments and debt investments and to pay distributions. The number and type of properties we may acquire and debt and other investments we may make will depend upon real estate market conditions, the amount of proceeds we raise in our public offering, and other circumstances existing at the time we make our investments.

Our primary investment objectives include the following:

• Preserving and protecting our stockholders’ capital contributions;

• Providing current income to our stockholders in the form of regular cash distributions; and

• Realizing capital appreciation upon the potential sale of our assets or other liquidity events.

There is no assurance that we will attain our investment objectives. Our charter places numerous limitations on us with respect to the manner in which we may invest our funds. In most cases these limitations cannot be changed unless our charter is amended, which may require the approval of our stockholders.

We may acquire assets free and clear of mortgage or other indebtedness by paying the entire purchase price in cash or equity securities, or a combination thereof, and we may selectively encumber all or only certain assets with debt. The proceeds from our borrowings may be used to fund investments, make capital expenditures, pay distributions, and for general corporate purposes. As of September 30, 2014, our consolidated debt leverage ratio (calculated as the book value of our debt to total assets) was 18.2%.

Industrial Real Estate Outlook

The U.S. industrial property sector continues to show improvement supported by: (i) improving U.S. international trade volume as reflected in the increasing levels of both imported and exported goods; (ii) generally positive growth in U.S. gross domestic product (“GDP”) over the past three years; (iii) increased domestic consumer spending, including significant growth in online retailing (or e-tailing); (iv) positive net absorption in our targeted markets (the net change in total occupied industrial space); and (v) strong fundamental trends in both population and employment growth. While the strength and sustainability of the recovery remain uncertain, both U.S. GDP and consumer spending indicators remain positive and we believe will continue growing over the next several quarters, which is encouraging, as there is a high correlation between these statistics and industrial demand. Further, forecasted growth in employment and population should help drive consumer spending over the longer-term, leading to increased utilization of distribution warehouses. U.S. international trade value has grown with an approximate 8% compounded annual growth rate over the past five years. This resurgence in export/import levels has generated increased demand for industrial space in key U.S. logistic markets resulting in 18 consecutive quarters of positive net absorption and providing strong prospects for rent growth over the next several years.

Lending terms for direct commercial real estate loans and unsecured REIT financings have continued to improve; however, this trend may not continue, which could affect our ability to finance future operations and acquisition and development activities. We have managed, and expect

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to continue to manage, our financing strategy under the current mortgage lending and REIT financing environment by considering various lending sources, which may include long-term fixed rate mortgage loans; unsecured or secured lines of credit or term loans; private placement or public bond issuances; and assuming existing mortgage loans in connection with certain property acquisitions, or any combination of the foregoing.

RESULTS OF OPERATIONS

Summary of 2014 Activities

During the nine months ended September 30, 2014, we completed the following activities:

• We raised $148.8 million of gross equity capital from the Offering.

• We acquired 15 industrial buildings comprising approximately 1.9 million square feet for an aggregate total purchase price of approximately $147.2 million, exclusive of transfer taxes, due diligence expenses, and other closing costs. We funded these acquisitions with proceeds from the Offering and borrowings under our line of credit.

• We entered into a $100.0 million revolving credit agreement, as amended, with the ability to expand the commitment up to a maximum aggregate amount of $400.0 million, subject to certain conditions. The revolving credit agreement matures in January 2017.

• As of September 30, 2014, our portfolio was 99.6% leased.

We are currently in the acquisition phase of our life cycle and the results of our operations are primarily impacted by the timing of our acquisitions and the equity raised through the Offering. Accordingly, our operating results for the three and nine months ended September 30, 2014 and 2013 are not directly comparable, nor are our results of operations for the three and nine months ended September 30, 2014 and 2013 indicative of those expected in future periods. We believe that our revenues and operating expenses will continue to increase in future periods as a result of continued growth in our current portfolio and as a result of the additive effect of anticipated future acquisitions of industrial properties.

Results for the Three and Nine months Ended September 30, 2014 Compared to the Same Periods in 2013

The following table summarizes the changes in our results of operations for the three and nine months ended September 30, 2014 as compared to the three and nine months ended September 30, 2013. Same store information is not provided due to the fact that all buildings were acquired during 2014.

	For the Three Months						For the Nine Months
	Ended September 30,						Ended September 30,
(in thousands, except per share data)	2014		2013		Change		2014		2013		Change
Total revenues	$	1,503	$	-	$	1,503	$	2,378	$	-	$	2,378
Total rental expenses		(381)		-		(381)		(614)		-		(614)
Total net operating income		1,122		-		1,122		1,764		-		1,764
Real estate-related depreciation and amortization		(793)		-		(793)		(1,233)		-		(1,233)
General and administrative expenses		(554)		(87)		(467)		(1,480)		(87)		(1,393)
Organization expenses, related party		-		(40)		40		(17)		(40)		23
Asset management fees, related party		(186)		-		(186)		(290)		-		(290)
Acquisition expenses, related party		(1,638)		-		(1,638)		(2,947)		-		(2,947)
Acquisition expenses		(1,093)		(1)		(1,092)		(1,731)		(1)		(1,730)
Interest expense		(158)		(1)		(157)		(457)		(1)		(456)
Expense support from Advisor		1,160		-		1,160		2,517		-		2,517
Total other		(3,262)		(129)		(3,133)		(5,638)		(129)		(5,509)
Net loss		(2,140)		(129)		(2,011)		(3,874)		(129)		(3,745)
Net loss attributable to noncontrolling interests		-		-		-		-		-		-
Net loss attributable to common stockholders	$	(2,140)	$	(129)	$	(2,011)	$	(3,874)	$	(129)	$	(3,745)
Weighted-average shares outstanding		11,645		80		11,565		5,957		40		5,917
Net loss per common share - basic and diluted	$	(0.18)	$	(1.61)	$	1.43	$	(0.65)	$	(3.22)	$	2.57

Rental revenues are comprised of base rent, straight-line rent, amortization of above- and below-market lease assets and liabilities, and tenant reimbursement revenue. Total rental revenues increased for the three and nine months ended September 30, 2014, as compared to the same periods in 2013, due to our acquisition activity during the first three quarters of 2014.

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Rental expenses include certain property operating expenses typically reimbursed by our customers, such as real estate taxes, property insurance, property management fees, repair and maintenance, and certain non-recoverable expenses, such as consulting services and roof repairs. Total rental expenses increased for the three and nine months ended September 30, 2014, as compared to the same periods in 2013, due to our acquisition activity during the first three quarters of 2014.

In addition, our results of operations for the three and nine months ended September 30, 2014 included the following, which were all due to our acquisition activity during the first three quarters of 2014:

• acquisition-related expenses, real estate-related depreciation and amortization expense, and asset management fees;

• general and administrative expenses that primarily consisted of: (i) accounting and legal expenses incurred; (ii) compensation to our independent directors; and (iii) expenses related to directors’ and officers’ insurance;

• interest expense primarily due to: (i) average net borrowings under the line of credit of $1.1 million and $2.4 million, respectively, for the three and nine months ended September 30, 2014; (ii) amortization of loan costs; and (iii) unused line of credit fees; and

• expense support from the Advisor pursuant to the Second Amended and Restated Expense Support Agreement.

ADDITIONAL MEASURES OF PERFORMANCE

Net Operating Income (“NOI”)

We define NOI as GAAP rental revenues less GAAP rental expenses. For the three and nine months ended September 30, 2014, NOI was $1.1 million and $1.8 million, respectively. There was no NOI for the three and nine months ended September 30, 2013. We consider NOI to be an appropriate supplemental performance measure and believe NOI provides useful information to our investors regarding our financial condition and results of operations because NOI reflects the operating performance of our properties and excludes certain items that are not considered to be controllable in connection with the management of the properties, such as real estate-related depreciation and amortization, acquisition-related expenses, general and administrative expenses, and interest expense. However, NOI should not be viewed as an alternative measure of our financial performance since it excludes such expenses, which could materially impact our results of operations. Further, our NOI may not be comparable to that of other real estate companies as they may use different methodologies for calculating NOI. Therefore, we believe net loss, as defined by GAAP, to be the most appropriate measure to evaluate our overall performance. Refer to “Results of Operations” above for a reconciliation of our net loss to NOI for the three and nine months ended September 30, 2014.

Funds from Operations (“FFO”), Company-Defined FFO and Modified Funds from Operations (“MFFO”)

We believe that FFO, Company-defined FFO, and MFFO, in addition to net loss and cash flows from operating activities as defined by GAAP, are useful supplemental performance measures that our management uses to evaluate our consolidated operating performance. However, these supplemental, non-GAAP measures should not be considered as an alternative to net loss or to cash flows from operating activities as an indication of our performance and are not intended to be used as a liquidity measure indicative of cash flow available to fund our cash needs, including our ability to make distributions to our stockholders. No single measure can provide users of financial information with sufficient information and only our disclosures read as a whole can be relied upon to adequately portray our financial position, liquidity, and results of operations. In addition, other REITs may define FFO and similar measures differently and choose to treat acquisition-related costs and potentially other accounting line items in a manner different from us due to specific differences in investment and operating strategy or for other reasons.

FFO. As defined by the National Association of Real Estate Investment Trusts (“NAREIT”), FFO is a non-GAAP measure that excludes certain items such as real estate-related depreciation and amortization. We believe FFO is a meaningful supplemental measure of our operating performance that is useful to investors because depreciation and amortization in accordance with GAAP implicitly assumes that the value of real estate assets diminishes predictably over time. We use FFO as an indication of our consolidated operating performance and as a guide to making decisions about future investments.

Company-defined FFO. Similar to FFO, Company-defined FFO is a non-GAAP measure that excludes real estate-related depreciation and amortization, and also excludes non-recurring acquisition-related costs (including acquisition fees paid to the Advisor) and non-recurring organization costs, each of which are characterized as expenses in determining net loss under GAAP. Organization costs are excluded as they are paid in cash and relate to one-time costs paid in conjunction with the organization of the Company. The purchase of operating properties is a key strategic objective of our business plan focused on generating growth in operating income and cash flow in order to make distributions to investors. However, as the corresponding acquisition-related costs are paid in cash, all paid and accrued acquisition-related costs negatively impact our operating performance and cash flows from operating activities during the period in which properties are acquired. In addition, if we acquire a property after all offering proceeds from our public offerings have been invested, there will not be any offering proceeds to pay the corresponding acquisition-related costs. Accordingly, unless the Advisor determines to waive the payment or reimbursement of these acquisition-related costs, then such costs will be paid from additional debt, operational earnings or cash flow, net proceeds from the sale of properties, or ancillary cash flows. As such, Company-defined FFO may not be a complete indicator of our operating performance, especially during periods in which properties are being acquired, and may not be a useful measure of the long-term operating performance of our properties if we do not continue to operate our business plan as disclosed.

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MFFO. As defined by the Investment Program Association (“IPA”), MFFO is a non-GAAP supplemental financial performance measure used to evaluate our operating performance. Similar to FFO, MFFO excludes items such as real estate-related depreciation and amortization, but includes organization costs. Similar to Company-defined FFO, MFFO excludes acquisition-related costs. MFFO also excludes straight-line rent and amortization of above- and below-market leases. In addition, there are certain other MFFO adjustments as defined by the IPA that are not applicable to us and are not included in our presentation of MFFO.

We are currently in the acquisition phase of our life cycle. Management does not include historical acquisition-related expenses in its evaluation of future operating performance, as such costs are not expected to be incurred once our acquisition phase is complete. In addition, management does not include one-time organization costs as those costs are also not expected to be incurred now that we have commenced operations. We use Company-defined FFO and MFFO to, among other things: (i) evaluate and compare the potential performance of the portfolio after the acquisition phase is complete, and (ii) evaluate potential performance to determine liquidity event strategies. We believe Company-defined FFO and MFFO facilitate a comparison to other REITs that are not engaged in significant acquisition activity and have similar operating characteristics as us. We believe investors are best served if the information that is made available to them allows them to align their analyses and evaluation with the same performance metrics used by management in planning and executing our business strategy. We believe that these performance metrics will assist investors in evaluating the potential performance of the portfolio after the completion of the acquisition phase. However, these supplemental, non-GAAP measures are not necessarily indicative of future performance and should not be considered as an alternative to net loss or to cash flows from operating activities and are not intended to be used as a liquidity measure indicative of cash flow available to fund our cash needs. Neither the SEC, NAREIT, nor any regulatory body has passed judgment on the acceptability of the adjustments used to calculate Company-defined FFO and MFFO. In the future, the SEC, NAREIT, or a regulatory body may decide to standardize the allowable adjustments across the non-traded REIT industry at which point we may adjust our calculation and characterization of Company-defined FFO and MFFO.

The following unaudited table presents a reconciliation of net loss to FFO, Company-defined FFO and MFFO:

									For the Period
	For the Three Months				For the Nine Months				From Inception
	Ended September 30,				Ended September 30,				(August 28, 2012) to
(in thousands, except per share data)	2014		2013		2014		2013		September 30, 2014
Net loss	$	(2,140)	$	(129)	$	(3,874)	$	(129)	$	(4,101)
Net loss per common share	$	(0.18)	$	(1.61)	$	(0.65)	$	(3.22)	$	(1.82)
Reconciliation of net loss to FFO:
Net loss	$	(2,140)	$	(129)	$	(3,874)	$	(129)	$	(4,101)
Add (deduct) NAREIT-defined adjustments:
Real estate-related depreciation and amortization		793		-		1,233		-		1,233
FFO	$	(1,347)	$	(129)	$	(2,641)	$	(129)	$	(2,868)
FFO per common share	$	(0.12)	$	-	$	(0.44)	$	-	$	(1.27)
Reconciliation of FFO to Company-defined FFO:
FFO	$	(1,347)	$	(129)	$	(2,641)	$	(129)	$	(2,868)
Add (deduct) Company-defined adjustments:
Acquisition costs		2,731		1		4,678		1		4,741
Organization costs		-		40		17		40		93
Company-defined FFO	$	1,384	$	(88)	$	2,054	$	(88)	$	1,966
Company-defined FFO per common share	$	0.12	$	(1.10)	$	0.34	$	(2.20)	$	0.87
Reconciliation of Company-defined FFO to MFFO:
Company-defined FFO	$	1,384	$	(88)	$	2,054	$	(88)	$	1,966
Add (deduct) MFFO adjustments:
Straight-line rent and amortization of above/below market leases		(132)		-		(229)		-		(229)
Organization costs		-		(40)		(17)		(40)		(93)
MFFO	$	1,252	$	(128)	$	1,808	$	(128)	$	1,644
MFFO per common share	$	0.11	$	(1.60)	$	0.30	$	(3.20)	$	0.73
Weighted-average shares outstanding		11,645		80		5,957		40		2,259

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We believe that: (i) our FFO loss of $1.3 million, or $0.12 per share, as compared to the cash distributions declared in the amount of $1.4 million or $0.11875 per share, for the three months ended September 30, 2014; (ii) our FFO loss of $2.6 million or $0.44 per share, as compared to the cash distributions declared in the amount of $2.1 million, or $0.34375 per share, for the nine months ended September 30, 2014; and (iii) our FFO loss of $2.9 million, or $1.27 per share, as compared to the cash distributions declared of $2.1 million, or $0.56875 per share, for the period from Inception (August 28, 2012) to September 30, 2014, are not indicative of future performance as we are in the acquisition phase of our life cycle. See “Capital Resources and Uses of Liquidity—Cash Distributions” below for details concerning our cash distributions, which are paid in cash or reinvested in shares of our common stock by participants in our distribution reinvestment plan.

LIQUIDITY AND CAPITAL RESOURCES

Liquidity

Our primary sources of capital for meeting our cash requirements are, and will continue to be, net proceeds from the Offering, including proceeds from the sale of shares offered through our distribution reinvestment plan, debt financings, cash resulting from the expense support provided by the Advisor, and cash generated from operating activities. Our principal uses of funds are and will continue to be for the acquisition of properties and other investments, capital expenditures, operating expenses, payments under our debt obligations, and distributions to our stockholders. Over time, we intend to fund a majority of our cash needs for items other than asset acquisitions, including the repayment of debt and capital expenditures, from operating cash flows and refinancings. There may be a delay between the deployment of proceeds raised from our Offering and our purchase of assets, which could result in a delay in the benefits to our stockholders, if any, of returns generated from our investment operations.

The Advisor, subject to the oversight of the board of directors and, under certain circumstances, the investment committee or other committees established by the board of directors, will evaluate potential acquisitions and will engage in negotiations with sellers and lenders on our behalf. Pending investment in property, debt, or other investments, we may decide to temporarily invest any unused proceeds from our Offering in certain investments that are expected to yield lower returns than those earned on real estate assets. These lower returns may affect our ability to make distributions to our stockholders. Potential future sources of capital include proceeds from secured or unsecured financings from banks or other lenders, proceeds from the sale of assets, and undistributed funds from operations. If necessary, we may use financings or other sources of capital in the event of unforeseen significant capital expenditures.

We believe that our cash on-hand, anticipated Offering proceeds, proceeds from our line of credit, and other anticipated financing activities will be sufficient to meet our anticipated future acquisition, operating, distribution, and debt service requirements.

Cash Flows. The following table summarizes our cash flows, as determined on a GAAP basis, for the following periods:

	For the Nine Months
	Ended September 30,
(in thousands)	2014		2013
Total cash (used in) provided by:
Operating activities	$	(2,417)	$	(161)
Investing activities		(149,161)		-
Financing activities		159,455		2,000
Net increase in cash	$	7,877	$	1,839

Cash used in operating activities during the nine months ended September 30, 2014 was $2.4 million, which primarily related to acquisition-related expenses, rental expenses, and general and administrative expenses as a result of owning and managing the 15 buildings acquired during the nine months ended September 30, 2014.

Cash used in investing activities during the nine months ended September 30, 2014 was $149.2 million, which primarily related to acquisition activity during the nine months ended September 30, 2014.

Cash provided by financing activities during the nine months ended September 30, 2014 was $159.5 million, which primarily related to net proceeds raised from our public offering, as well as to net borrowings under the line of credit during the nine months ended September 30, 2014.

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Capital Resources and Uses of Liquidity

In addition to the cash and cash equivalents balance available, our capital sources and uses of liquidity are as follows:

Line of Credit. In January 2014, we entered into a revolving credit agreement, as amended, with an initial aggregate commitment of $100.0 million. We have the ability to expand the commitment up to a maximum aggregate amount of $400.0 million, subject to certain conditions and receiving bank commitments. This line of credit matures in January 2017, and may be extended pursuant to two one-year extension options, subject to certain conditions. The primary interest rate is variable and calculated based on one-month LIBOR plus a margin ranging from 1.90% to 2.75%, or an alternative base rate plus a margin of 0.90% to 1.75%. This line of credit is available for general corporate purposes, including but not limited to the acquisition and operation of industrial properties and other permitted investments. As of September 30, 2014, we had $30.0 million outstanding under the line of credit with an interest rate of 2.06%; the unused portion was $70.0 million, of which $62.6 million was available.

Offering Proceeds. As of September 30, 2014, the amount of aggregate gross proceeds raised from our Offering was $152.8 million ($135.7 million net of direct selling costs).

Cash Distributions. We intend to accrue and make cash distributions on a quarterly basis. Some or all of our future cash distributions may be paid from sources other than cash flows from operating activities, such as cash flows from financing activities, which include borrowings and net proceeds from primary shares sold in the Offering, proceeds from the issuance of shares pursuant to our distribution reinvestment plan, cash resulting from a waiver or deferral of fees or expense reimbursements otherwise payable to the Advisor or its affiliates, cash resulting from the Advisor or its affiliates paying certain of our expenses, proceeds from the sales of assets, and our cash balances. We have not established a cap on the amount of our cash distributions that may be paid from any of these sources. The amount of any cash distributions will be determined by our board of directors, and will depend on, among other things, current and projected cash requirements, tax considerations and other factors deemed relevant by our board. Our board of directors authorized daily cash distributions at a quarterly rate of $0.1125 per share of common stock for the Initial Quarter and fourth quarter of 2013 and the first and second quarters of 2014 and $0.11875 per share of common stock for the third quarter of 2014. Our board of directors authorized daily cash distributions at a quarterly rate of $0.1250 per share of common stock for the fourth quarter of 2014, which is an increase of $0.00625 per share, or an increase of 5.3%, compared to the cash distribution rate for the third quarter of 2014.

There can be no assurances that the current cash distribution rate will be maintained. In the near-term, we expect that we may need to continue to utilize cash flows from financing activities, as determined on a GAAP basis, and cash resulting from the expense support received from the Advisor to pay cash distributions, which if insufficient could negatively impact our ability to pay cash distributions. See “Note 8 to the Condensed Consolidated Financial Statements” for further detail regarding the expense support and conditional reimbursement agreement among us, the Operating Partnership and the Advisor.

The following table outlines sources used to pay total cash distributions (which are paid in cash or reinvested in shares of our common stock through our distribution reinvestment plan) for the periods indicated below:

	Source of Distributions
	Provided by			Proceeds			Proceeds from
	Operating			from Financing			Issuance of			Total
($ in thousands)	Activities (1)			Activities (2)			DRIP Shares (3)			Distributions
2014
September 30	$	-	-    %	$	710	51  %	$	674	49  %	$	1,384
June 30		-	-		300	54		258	46		558
March 31		-	-		74	66		38	34		112
Total	$	-	-    %	$	1,084	53  %	$	970	47  %	$	2,054
2013
December 31	$	-	-    %	$	29	91  %	$	3	9  %	$	32
September 30 (4)		-	-		7	100		-	-		7
Total	$	-	-    %	$	36	92  %	$	3	8 %	$	39

(1) For the quarters ended September 30, 2014, June 30, 2014, March 31, 2014 and December 31, 2013, the Advisor provided expense support of $1.2 million, $0.9 million, $0.5 million and $0.3 million, respectively.

(2) For the quarters ended September 30, 2014, June 30, 2014 and March 31, 2014, all cash distributions provided by financing activities were funded from debt financings. For the Initial Quarter and the quarter ended December 31, 2013, all cash distributions provided by financing activities were funded through net proceeds from primary shares sold in the Offering.

(3) Stockholders may elect to have cash distributions reinvested in shares of our common stock through our distribution reinvestment plan.

(4) The Initial Quarter commenced on September 6, 2013 and ended on September 30, 2013.

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Refer to “Note 6 to the Condensed Consolidated Financial Statements” for further detail on cash distributions.

SUBSEQUENT EVENTS

Status of Offering

As of November 5, 2014, we had raised gross proceeds of $178.6 million from the sale of 17.9 million shares of our common stock in our public offering, including shares issued under our distribution reinvestment plan. As of that date, 184.7 million shares remained available for sale pursuant to the Offering, including 52.5 million shares available for sale through our distribution reinvestment plan.

Distribution Increase

Our board of directors has authorized daily cash distributions at a quarterly rate of $0.1250 per share of common stock for the fourth quarter of 2014, which is an increase of $0.00625 per share, or an increase of 5.3% compared to the prior quarterly cash distribution rate.

Completed Acquisitions

Normal Junction Commerce Center. On October 21, 2014, we acquired two industrial buildings totaling approximately 140,000 square feet. These buildings are located in the Phoenix market and are 79% leased to four customers with a weighted-average remaining lease term (based on square feet) of 5.5 years. The total purchase price was $12.5 million, exclusive of transfer taxes, due diligence expenses and other closing costs. We funded this acquisition with proceeds from the Offering. Pursuant to the terms of the Advisory Agreement, we paid an acquisition fee of $0.2 million to the Advisor in connection with this acquisition.

Mechanicsburg Distribution Center. On October 23, 2014, we acquired one industrial building totaling approximately 147,000 square feet. This building is located in the Pennsylvania market and is 100% leased to one customer with a remaining lease term of 5.2 years. The total purchase price was $8.4 million, exclusive of transfer taxes, due diligence expenses and other closing costs. We funded this acquisition with proceeds from the Offering and borrowings under our corporate line of credit. Pursuant to the terms of the Advisory Agreement, we paid an acquisition fee of $0.2 million to the Advisor in connection with this acquisition.

West Valley Distribution Center II. On October 24, 2014, we acquired two industrial buildings totaling approximately 70,000 square feet. These buildings are located in the Seattle / Tacoma market and are 78% leased to seven customers with a weighted-average remaining lease term (based on square feet) of 2.0 years. The total purchase price was $5.9 million, exclusive of transfer taxes, due diligence expenses and other closing costs. We funded this acquisition with proceeds from the Offering and borrowings under our corporate line of credit. Pursuant to the terms of the Advisory Agreement, we paid an acquisition fee of $0.1 million to the Advisor in connection with this acquisition.

CentrePort Distribution Center. On October 31, 2014, we acquired one industrial building totaling approximately 310,000 square feet. This building is located in the Dallas market and is 100% leased to one customer with a remaining lease term of 2.7 years. The total purchase price was $16.7 million, exclusive of transfer taxes, due diligence expenses and other closing costs. We funded this acquisition with proceeds from the Offering and borrowings under our corporate line of credit. Pursuant to the terms of the Advisory Agreement, we paid an acquisition fee of $0.3 million to the Advisor in connection with this acquisition.

Tacoma Commerce Center. On October 31, 2014, we acquired one industrial building totaling approximately 50,000 square feet. This building is located in the Seattle / Tacoma market and is 90% leased to two customers with a weighted-average remaining lease term (based on square feet) of 3.5 years. The total purchase price was $3.4 million, exclusive of transfer taxes, due diligence expenses and other closing costs. We funded this acquisition with proceeds from the Offering and borrowings under our corporate line of credit. Pursuant to the terms of the Advisory Agreement, we paid an acquisition fee of $0.1 million to the Advisor in connection with this acquisition.

Richmond Distribution Center. On October 31, 2014, we acquired one industrial building totaling approximately 245,000 square feet. This building is located in the San Francisco market and is 100% leased to two customers with a weighted-average remaining lease term (based on square feet) of 0.8 years. The total purchase price was $18.4 million, exclusive of transfer taxes, due diligence expenses and other closing costs. We funded this acquisition with proceeds from the Offering and borrowings under our corporate line of credit. Pursuant to the terms of the Advisory Agreement, we paid an acquisition fee of $0.4 million to the Advisor in connection with this acquisition.

Acquisitions Under Contract

8A Distribution Center. On October 15, 2014, we entered into a purchase agreement to acquire one industrial building totaling approximately 293,000 square feet located in the New Jersey market. The building is currently partially leased to one customer under a lease that expires in November 2016. The total purchase price is expected to be approximately $23.5 million, exclusive of transfer taxes, due diligence expenses and other closing costs. In connection with the execution of the purchase agreement, we deposited $0.5 million into an escrow account. This acquisition is expected to close during the first quarter of 2015, but there can be no assurance the acquisition will be completed.

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Dallas Distribution Portfolio. On October 31, 2014, we entered into a purchase agreement to acquire three recently completed industrial buildings totaling approximately 1.3 million square feet located in the Dallas market. This portfolio is a recently completed development opportunity in a targeted top-tier industrial market, and is 12% leased to one customer with a remaining lease term of 4.5 years. The total purchase price is expected to be approximately $74.6 million, exclusive of transfer taxes, due diligence expenses and other closing costs. In connection with the execution of the purchase agreement, we deposited $2.0 million into an escrow account. This acquisition is expected to close during the fourth quarter of 2014, but there can be no assurance the acquisition will be completed.

Pursuant to the terms of the Advisory Agreement, we expect to pay an acquisition fee to the Advisor equal to 2.0% of the purchase price of each of the acquisitions under contract described above. We plan to fund these acquisitions using proceeds from the Offering and debt financing. The consummation of these acquisitions is subject to our completion of due diligence and various closing conditions to be met by the parties. If we do not close on these acquisitions, there are circumstances under which we may forfeit our respective deposits.

CONTRACTUAL OBLIGATIONS

See “Note 4 to the Condensed Consolidated Financial Statements” related to our borrowings under our line of credit as of September 30, 2014.

OFF-BALANCE SHEET ARRANGEMENTS

As of September 30, 2014, we had no off-balance sheet arrangements that have or are reasonably likely to have a material effect, on our financial condition, changes in our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures, or capital resources.

RECENT ACCOUNTING STANDARDS

In April 2014, the FASB issued ASU No. 2014-08, “Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity,” which changes the criteria at which a disposal will qualify as a discontinued operation and requires new disclosure of both discontinued operations and certain other disposals that do not meet the definition of a discontinued operation. Under the revised standard, the definition of discontinued operations has been changed so that only disposals of components that represent strategic shifts qualify for discontinued operations reporting. As permitted, we adopted ASU 2014-08 early, and it became effective for us for the quarter ended March 31, 2014. The adoption of this standard did not have an impact on our results of operations, financial position or liquidity.

In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which provides guidance for revenue recognition and supersedes the revenue recognition requirements in Topic 605, “Revenue Recognition.” The standard is based on the principle that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. ASU 2014-09 also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. The new guidance specifically excludes revenue derived from lease contracts from its scope. The standard will be effective for us in the first quarter of fiscal year 2017. Early adoption is not permitted. We are currently evaluating the impact of the adoption of this standard on our consolidated financial statements.

CRITICAL ACCOUNTING ESTIMATES

Our unaudited condensed consolidated financial statements have been prepared in accordance with GAAP and in conjunction with the rules and regulations of the SEC. The preparation of our unaudited condensed consolidated financial statements requires significant management judgments, assumptions, and estimates about matters that are inherently uncertain. These judgments affect the reported amounts of assets and liabilities and our disclosure of contingent assets and liabilities at the dates of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting periods. With different estimates or assumptions, materially different amounts could be reported in our condensed consolidated financial statements. Additionally, other companies may utilize different estimates that may impact the comparability of our results of operations to those of companies in similar businesses. For a detailed description of our critical accounting estimates, see Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our 2013 Form 10-K. As of September 30, 2014, our critical accounting estimates have not changed from those described in our 2013 Form 10-K.

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest Rate Risk

Our market risk is exposure to changes in interest rates. Our interest rate risk management objectives are to limit the impact of interest rate changes on earnings and cash flows, and optimize overall borrowing costs. To achieve these objectives, we plan to primarily borrow on a fixed interest rate basis for longer-term debt and utilize interest rate swap agreements on certain variable interest rate debt in order to limit the effects of changes in interest rates on our results of operations. As of September 30, 2014, our debt instruments were comprised of borrowings under our line of credit.

Variable Interest Rate Debt. As of September 30, 2014, our consolidated variable interest rate debt consisted of borrowings under our line of credit, which represented 100% of our total consolidated debt. Interest rate changes in LIBOR could impact our future earnings and cash flows, but would not significantly affect the fair value of the variable interest rate debt instruments. As of September 30, 2014, we were exposed to market risks related to fluctuations in interest rates on $30.0 million of consolidated borrowings. A hypothetical 10% change in the average interest rate on the outstanding balance of our variable interest rate debt as of September 30, 2014, would change our annual interest expense by approximately $4,800.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Under the direction of our Chief Executive Officer and Chief Financial Officer, we evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of September 30, 2014. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of September 30, 2014, our disclosure controls and procedures were effective.

Internal Control Over Financial Reporting

There have not been any changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the three months ended September 30, 2014 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II. OTHER INFORMATION

ITEM 1A. RISK FACTORS

In addition to the other information set forth in this report, you should carefully consider the risk factors discussed in Part I, Item 1A, “Risk Factors” of our 2013 Form 10-K, which could materially affect our business, financial condition, and/or future results. The risks described in our 2013 Form 10-K are not the only risks facing us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition, and/or operating results.

With the exception of the revised risk factors set forth below, there have been no material changes to the risk factors disclosed in our 2013 Form 10-K.

RISKS RELATED TO THE ADVISOR AND ITS AFFILIATES

We will compete with entities sponsored or advised by affiliates of our Sponsor for opportunities to acquire or sell investments, and for customers, which may have an adverse impact on our operations.

We will compete with entities sponsored or advised by affiliates of our Sponsor whether existing or created in the future, for opportunities to acquire, finance or sell certain types of properties. We may also buy, finance or sell properties at the same time as entities sponsored or advised by affiliates of our Sponsor are buying, financing or selling properties. In this regard, there is a risk that the Advisor will purchase a property that provides lower returns to us than a property purchased by entities sponsored or advised by affiliates of our Sponsor. Certain entities sponsored or advised by affiliates of our Sponsor own and/or manage properties in geographical areas in which we expect to own properties. Therefore, our properties may compete for customers with other properties owned and/or managed by entities sponsored or advised by affiliates of our Sponsor. The Advisor may face conflicts of interest when evaluating customer leasing opportunities for our properties and other properties owned and/or managed by entities sponsored or advised by affiliates of our Sponsor and these conflicts of interest may have a negative impact on our ability to attract and retain customers.

The Sponsor and the Advisor have agreed, subject to changes approved by the Conflicts Resolution Committee, that (the “IPT/IIT Allocation Arrangement”): if an investment is equally suitable for Industrial Income Trust Inc. (“IIT”) and us, until such time as all of the proceeds from our public offerings have been fully invested and except as noted below, we will have priority over IIT with respect to: (i) industrial properties (including all new stabilized, value add, and forward commitment opportunities, collectively “Core Industrial Investment Opportunities”) located in the U.S. or Mexico; and (ii) debt investments related to industrial properties located in the U.S. or Mexico; provided, however, that: (a) other than development or re-development opportunities associated with our existing investments (e.g., development on excess land or expansion of an existing facility) which opportunities shall remain with us, IIT will have priority with respect to all opportunities related to development of industrial properties (including all new speculative and build-to-suit opportunities, collectively, “Industrial Development Opportunities”) located in the U.S. or Mexico; and (b) when, from time to time, IIT has additional capital to deploy (either through the sale of assets or otherwise) into Core Industrial Investment Opportunities, and, when, from time to time, we have capital available to deploy into Industrial Development Opportunities, our CEO and regional Managing Directors (who currently serve in similar positions at IIT) will determine in their sole discretion for which program the investment is most suitable by utilizing the following allocation factors:

• The investment objectives and criteria of each program;

• The general real property sector or debt investment allocation targets of each program and any targeted geographic concentration;

• The cash requirements of each program;

• The strategic proximity of the investment opportunity to other assets owned by each program;

• The effect of the acquisition both on diversification of each program’s investments by type of commercial property and geographic area, and on diversification of the customers of its properties;

• The policy of each program relating to leverage of investments;

• The anticipated cash flow of each program;

• The tax effects of the purchase on each program;

• The size of the investment; and

• The amount of funds available to each program and the length of time such funds have been available for investment.

Any such determinations will be reported, at least quarterly, to our Conflicts Resolution Committee in order to evaluate whether we are receiving our fair share of opportunities.

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In addition, Dividend Capital Diversified Property Fund Inc. (“DPF”) has priority over us and IIT (collectively, “IPT/IIT”) for all other non-industrial real estate or non-industrial debt investment opportunities until such time as it is no longer engaged in a public offering and all of the proceeds from its public offerings have been fully invested. Further, in recognition of the fact that DPF also desires to acquire industrial properties and industrial debt investments and has a separate day-to-day asset acquisition team, the Sponsor and the Advisor have agreed, subject to changes approved or required by our Conflicts Resolution Committee, that (1) if an industrial property or industrial debt opportunity is a widely-marketed, brokered transaction, DPF, on the one hand, and IPT/IIT, on the other hand, may simultaneously and independently pursue such transaction, and (2) if an industrial property or industrial debt opportunity is not a widely-marketed, brokered transaction, then, as between DPF, on the one hand, and IPT/IIT, on the other hand, the management team and employees of each company generally are free to pursue any such industrial property or industrial debt opportunity at any time, subject to certain allocations if non-widely-marketed transactions are first sourced by certain shared employees, managers or directors.

We may have difficulty funding our distributions with funds provided by cash flows from operating activities; therefore, we may use cash flows from financing activities, which may include borrowings and net proceeds from primary shares sold in this offering, proceeds from the issuance of shares under our distribution reinvestment plan, cash resulting from a waiver or deferral of fees by the Advisor or from expense support provided by the Advisor, or other sources to fund distributions to our stockholders. The use of these sources to pay distributions and the ultimate repayment of any liabilities incurred could adversely impact our ability to pay distributions in future periods, decrease the amount of cash we have available for operations and new investments and/or potentially impact the value or result in dilution of your investment by creating future liabilities, reducing the return on your investment or otherwise.

Until the proceeds from this offering are fully invested, and from time to time thereafter, we may not generate sufficient cash flows from operating activities, as determined on a GAAP basis, to fully fund distributions to you. Therefore, particularly in the earlier part of this offering, we have funded and may continue to fund distributions to our stockholders with cash flows from financing activities, which may include borrowings and net proceeds from primary shares sold in this offering, proceeds from the issuance of shares under our distribution reinvestment plan, cash resulting from a waiver or deferral of fees or expense reimbursements otherwise payable to the Advisor or its affiliates, cash resulting from the Advisor or its affiliates paying certain of our expenses, proceeds from the sales of assets, or interest income from our cash balances. However, there is no limit on the amount of time that we may use such sources to fund distributions. We may be required to fund distributions from a combination of some of these sources if our investments fail to perform as anticipated, if expenses are greater than expected or as a result of numerous other factors. We have not established a cap on the amount of our distributions that may be paid from any of these sources. Using certain of these sources may result in a liability to us, which would require a future repayment. For the year ended December 31, 2013 and the nine months ended September 30, 2014, 100% of our total distributions were funded from sources other than cash flows from operating activities, specifically 92% and 53%, respectively, were funded with proceeds from financing activities, which consisted of net proceeds from primary shares sold in this offering with respect to the year ended December 31, 2013 and debt financings with respect to the nine months ended September 30, 2014, and 8% and 47%, respectively, were funded with proceeds from the issuance of shares under our distribution reinvestment plan, or DRIP shares, as so elected by certain stockholders. Further, for the period from inception (August 28, 2012) to June 30, 2014, our total distributions declared exceeded our FFO.

The use of these sources for distributions and the ultimate repayment of any liabilities incurred, as well as the payment of distributions in excess of our FFO could adversely impact our ability to pay distributions in future periods, decrease the amount of cash we have available for operations and new investments and potentially reduce your overall return and adversely impact and dilute the value of your investment in shares of our common stock, which would be reflected when we establish a value per share. To the extent distributions in excess of current and accumulated earnings and profits (i) do not exceed a stockholder’s adjusted tax basis in our stock, such distributions will not be taxable to a stockholder, but rather a stockholder’s adjusted tax basis in our stock will be reduced; and (ii) exceed a stockholder’s adjusted tax basis in our stock, such distributions will be included in income as long-term capital gain if the stockholder has held its shares for more than one year and otherwise as short-term capital gain.

In addition, the Advisor or its affiliates could choose to receive shares of our common stock or interests in the Operating Partnership in lieu of cash or deferred fees or the repayment of advances to which they are entitled, and the issuance of such securities may dilute your investment in shares of our common stock.

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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Use of Proceeds

On July 24, 2013, our Registration Statement on Form S-11 (File No. 333-184126), pursuant to which we are making our initial public offering of up to $2.0 billion in shares of common stock, was declared effective under the Securities Act, and the Offering commenced the same day. The Offering is currently expected to terminate on July 24, 2015, unless extended by our board of directors for up to an additional one and a half years, subject to applicable regulatory requirements.

As of September 30, 2014, we had raised gross offering proceeds from the Offering of $152.8 million. The table below summarizes the direct selling costs paid from offering proceeds that were incurred by certain of our affiliates on our behalf in connection with the issuance and distribution of our registered securities and the offering proceeds net of those direct selling costs:

	For the Period
	from Inception
	(August 28, 2012) to
(in thousands)	September 30, 2014
Sales commissions (1)	$	10,373
Dealer manager fees (1)		3,751
Offering costs (2)		2,947
Total direct selling costs	$	17,071
Offering proceeds, net of direct selling costs	$	135,719

(1) The sales commissions and dealer manager fees are payable to the Dealer Manager, and a substantial portion of the commissions and fees are reallowed by the Dealer Manager to participating broker dealers as commissions and marketing fees and expenses.

(2) As of September 30, 2014, the Advisor had incurred $8.2 million of offering costs, all of which were paid directly by the Advisor on behalf of the Company. The Company has reimbursed the Advisor for $2.9 million of offering costs. The Company reimburses the Advisor or its affiliates for cumulative organization expenses and for cumulative expenses of its public offerings up to 2.0% of the aggregate gross offering proceeds from the sale of shares in its public offerings. The Advisor or an affiliate of the Advisor is responsible for the payment of the Company’s cumulative organization expenses and offering expenses to the extent that such cumulative expenses exceed 2.0% of the gross offering proceeds from the sale of shares in the Company’s public offerings, without recourse against or reimbursement by the Company.

As of September 30, 2014, we had acquired 15 industrial buildings totaling approximately 1.9 million square feet for an aggregate total purchase price of approximately $147.2 million, exclusive of transfer taxes, due diligence expenses, and other closing costs. As of September 30, 2014, we had paid $1.8 million in acquisition-related expenses.

Refer to “Note 8 to the Condensed Consolidated Financial Statements” for a description of the fees paid to the Advisor and its affiliates.

As noted in “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Capital Resources and Uses of Liquidity—Cash Distributions,” we used $36,000 of net proceeds from primary shares sold in the Offering to fund distributions for the Initial Quarter and for the quarter ended December 31, 2013.

Share Redemption Program

Subject to certain restrictions and limitations, a stockholder may redeem shares of our common stock for cash at a price that may reflect a discount from the purchase price paid for the shares of common stock being redeemed. Shares of common stock must be held for a minimum of one year, subject to certain exceptions. We are not obligated to redeem shares of our common stock under the share redemption program. We presently intend to limit the number of shares to be redeemed during any consecutive 12-month period to no more than five percent of the number of shares of common stock outstanding at the beginning of such 12-month period. We also intend to limit redemptions in accordance with a quarterly cap.

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After a stockholder has held shares of our common stock for a minimum of one year, our share redemption program may provide a limited opportunity for a stockholder to have its shares of common stock redeemed, subject to certain restrictions and limitations, at a price equal to or at a discount from the purchase price of the shares of our common stock being redeemed and the amount of the discount (the “Holding Period Discount”) will vary based upon the length of time that our stockholders have held their shares of our common stock subject to redemption, as described in the following table:

Share Purchase Anniversary	Redemption Price as a Percentage of the Purchase Price
Less than one year	No redemption allowed
One year	92.5%
Two years	95.0%
Three years	97.5%
Four years and longer	100.0%

In the event that a stockholder seeks to redeem all of its shares of our common stock, shares of our common stock purchased pursuant to our distribution reinvestment plan may be excluded from the foregoing one-year holding period requirement, in the discretion of our board of directors. If a stockholder has made more than one purchase of our common stock (other than through our distribution reinvestment plan), the one-year holding period will be calculated separately with respect to each such purchase. In addition, for purposes of the one-year holding period, holders of Operating Partnership Units (“OP Units”) who exchange their OP Units for shares of our common stock shall be deemed to have owned their shares as of the date they were issued their OP Units. Neither the one-year holding period nor the Redemption Caps (as defined in the share redemption plan) will apply in the event of the death of a stockholder and such shares will be redeemed at a price equal to 100% of the price paid by the deceased stockholder for the shares without regard to the date of purchase of the shares to be redeemed; provided, however, that any such redemption request with respect to the death of a stockholder must be submitted to us within 18 months after the date of death, as further described in the share redemption plan. Our board of directors reserves the right in its sole discretion at any time and from time to time to (a) waive the one-year holding period and either of the Redemption Caps (defined in the share redemption plan) in the event of the disability (as such term is defined in Section 72(m)(7) of the Internal Revenue Code) of a stockholder, (b) reject any request for redemption for any reason, or (c) reduce the number of shares of our common stock allowed to be redeemed under the share redemption program. A stockholder’s request for redemption in reliance on any of the waivers that may be granted in the event of the disability of the stockholder must be submitted within 18 months of the initial determination of the stockholder’s disability, as further described in the share redemption plan. If our board of directors waives the one-year holding period in the event of the disability of a stockholder, such stockholder will have its shares redeemed at the discounted amount listed in the above table for a stockholder who has held for one year. In all other cases in the event of the disability of a stockholder, such stockholder will have its shares redeemed as described in the above table. Furthermore, any shares redeemed in excess of the Quarterly Redemption Cap (as defined in the share redemption plan) as a result of the death or disability of a stockholder will be included in calculating the following quarter’s redemption limitations. At any time we are engaged in an offering of shares of our common stock, the per share price for shares of our common stock redeemed under our redemption program will never be greater than the then-current offering price of our shares of our common stock sold in the primary offering. The above description of the share redemption program is a summary of certain of the terms of the share redemption program. Please see the full text of the share redemption program, which is incorporated by reference as Exhibit 4.2 to this Quarterly Report on Form 10-Q, for all the terms and conditions.

As of September 30, 2014, we had not received any eligible redemption requests nor redeemed any shares of our common stock.

ITEM 6. EXHIBITS

The exhibits required by this item are set forth on the Exhibit Index attached hereto.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	INDUSTRIAL PROPERTY TRUST INC.
November 12, 2014	By:	/s/ DWIGHT L. MERRIMAN III
		Dwight L. Merriman III Chief Executive Officer (Principal Executive Officer)
November 12, 2014	By:	/s/ THOMAS G. MCGONAGLE
		Thomas G. McGonagle Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)

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EXHIBIT INDEX

EXHIBIT   NUMBER	DESCRIPTION
3.1	Articles of Amendment and Restatement of Industrial Property Trust Inc., dated July 16, 2013. Incorporated by reference to Exhibit 3.1 to Pre-Effective Amendment No. 3 to the Registration Statement on Form S-11 (File No. 333-184126) filed with the SEC on July 17, 2013.
3.2	Articles Supplementary of Industrial Property Trust Inc., dated August 8, 2013. Incorporated by reference to Exhibit 3.3 to Post-Effective Amendment No. 1 to the Registration Statement on Form S-11 (File No. 333-184126) filed with the SEC on August 14, 2013.
3.3	Articles of Amendment of Industrial Property Trust Inc., dated August 27, 2013. Incorporated by reference to Exhibit 3.4 on to the Annual Report on Form 10-K filed with the SEC on March 7, 2014.
3.4	Certificate of Correction to Articles of Amendment and Restatement of Industrial Property Trust Inc., dated March 20, 2014. Incorporated by reference to Exhibit 3.4 to Post-Effective Amendment No. 3 to the Registration Statement on Form S-11 (File No. 333-184126) filed with the SEC on April 16, 2014.
3.5	Third Amended and Restated Bylaws of Industrial Property Trust Inc. Incorporated by reference to Exhibit 3.5 to Post-Effective Amendment No. 3 to the Registration Statement on Form S-11 (File No. 333-184126) filed with the SEC on April 16, 2014.
4.2	Share Redemption Program, dated August 8, 2013. Incorporated by reference to Exhibit 4.3 to Post-Effective Amendment No. 1 to the Registration Statement on Form S-11 (File No. 333-184126) filed with the SEC on August 14, 2013.
10.1	Purchase and Sale Agreement and Joint Escrow Instructions, dated April 8, 2014, by and between IPT Acquisitions LLC and ProLogis-A4 FL I LLC. Incorporated by reference to Exhibit 10.21 to the Post-Effective Amendment No. 3 to the Registration Statement on Form S-11 (File No. 333-184126) filed with the SEC on April 16, 2014.
10.2	Purchase and Sale Agreement, dated as of May 13, 2014, between TPRF III/Rialto Industrial, LLC and IPT Acquisitions LLC. Incorporated by reference to Exhibit 10.21 to the Post-Effective Amendment No. 4 to the Registration Statement on Form S-11 (File No. 333-184126) filed with the SEC on July 16, 2014.
10.3	Purchase and Sale Agreement and Joint Escrow Instructions, dated May 19, 2014, by and between IPT Acquisitions LLC and Palmtree Acquisition Corporation. Incorporated by reference to Exhibit 10.22 to the Post-Effective Amendment No. 4 to the Registration Statement on Form S-11 (File No. 333-184126) filed with the SEC on July 16, 2014.
10.4	Purchase and Sale Agreement, dated June 6, 2014, by and between Kylie Capital LLC and IPT Acquisitions LLC Incorporated by reference to Exhibit 10.23 to the Post-Effective Amendment No. 4 to the Registration Statement on Form S-11 (File No. 333-184126) filed with the SEC on July 16, 2014.
10.5	Second Amended and Restated Expense Support and Conditional Reimbursement Agreement dated October 14, 2014 by and among Industrial Property Trust Inc., Industrial Property Operating Partnership LP and Industrial Property Advisors LLC. Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed with the SEC on October 15, 2014.
10.6	Amended and Restated Advisory Agreement, dated July 16, 2014, by and among Industrial Property Trust Inc., Industrial Property Operating Partnership LP and Industrial Property Advisors LLC. Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed with the SEC on July 16, 2014.
10.7	Purchase and Sale Agreement, dated July 29, 2014, by and between Baird Investment Company, Frederick C. Mansfield, Trustee of the Sylvia Baldwin Mansfield Trust, dated November 21, 1975, as amended and restated and IPT Acquisitions LLC. Incorporated by reference to Exhibit 10.24 to the Post-Effective Amendment No. 5 to the Registration Statement on Form S-11 (File No. 333-184126) filed with the SEC on October 16, 2014.
10.8	Purchase and Sale Agreement, dated August 5, 2014, by and between Avera Development, LLC and IPT Acquisitions LLC. Incorporated by reference to Exhibit 10.25 to the Post-Effective Amendment No. 5 to the Registration Statement on Form S-11 (File No. 333-184126) filed with the SEC on October 16, 2014.
10.9	Agreement of Sale, dated September 5, 2014, by and between IAC 1000 County Line L.L.C. and IPT O’Hare DC LLC. Incorporated by reference to Exhibit 10.26 to the Post-Effective Amendment No. 5 to the Registration Statement on Form S-11 (File No. 333-184126) filed with the SEC on October 16, 2014.

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EXHIBIT   NUMBER	DESCRIPTION
10.10	Purchase and Sale Agreement, dated September 5, 2014, by and between CRP-3 BWIC I, LLC and CRP-3 BWIC II, LLC and IPT Acquisitions LLC. Incorporated by reference to Exhibit 10.27 to the Post-Effective Amendment No. 5 to the Registration Statement on Form S-11 (File No. 333-184126) filed with the SEC on October 16, 2014.
10.11	Purchase and Sale Agreement, dated September 16, 2014, by and between Elgin Realty Company, LLP and IPT Acquisitions LLC. Incorporated by reference to Exhibit 10.28 to the Post-Effective Amendment No. 5 to the Registration Statement on Form S-11 (File No. 333-184126) filed with the SEC on October 16, 2014.
31.1*	Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*	Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1**	Certifications of Principal Executive Officer and Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101	The following materials from Industrial Property Trust Inc.’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2014, filed on November 12, 2014, formatted in XBRL (eXtensible Business Reporting Language): (i) Condensed Consolidated Balance Sheets, (ii) Condensed Consolidated Statements of Operations, (iii) Condensed Consolidated Statement of Equity, (iv) Condensed Consolidated Statements of Cash Flows, and (v) Notes to the Condensed Consolidated Financial Statements

* Filed herewith.

** Furnished herewith.

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