(State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification No.) |
(Address of Principal Executive Offices) | (Zip Code) |
Title of Each Class | Trading Symbol(s) | Name Of Each Exchange On Which Registered | ||||||||||||
☒ | Accelerated filer | ☐ | ||||||||||||
Non-accelerated filer | ☐ | Smaller reporting company | ||||||||||||
Emerging growth company |
Page | ||||||||
September 30, | December 31, | |||||||||||||
2023 | 2022 | |||||||||||||
ASSETS | ||||||||||||||
Real estate properties: | ||||||||||||||
Land | $ | $ | ||||||||||||
Buildings and improvements | ||||||||||||||
Total real estate properties, gross | ||||||||||||||
Accumulated depreciation | ( | ( | ||||||||||||
Total real estate properties, net | ||||||||||||||
Assets of properties held for sale | ||||||||||||||
Investment in unconsolidated joint venture | ||||||||||||||
Acquired real estate leases, net | ||||||||||||||
Cash and cash equivalents | ||||||||||||||
Restricted cash | ||||||||||||||
Rents receivable, including straight line rents of $ | ||||||||||||||
Other assets, net | ||||||||||||||
Total assets | $ | $ | ||||||||||||
LIABILITIES AND EQUITY | ||||||||||||||
Mortgages and notes payable, net | $ | $ | ||||||||||||
Liabilities of properties held for sale | ||||||||||||||
Accounts payable and other liabilities | ||||||||||||||
Assumed real estate lease obligations, net | ||||||||||||||
Due to related persons | ||||||||||||||
Total liabilities | ||||||||||||||
Commitments and contingencies | ||||||||||||||
Equity: | ||||||||||||||
Equity attributable to common shareholders: | ||||||||||||||
Common shares of beneficial interest, $ | ||||||||||||||
Additional paid in capital | ||||||||||||||
Cumulative net income | ||||||||||||||
Cumulative other comprehensive income | ||||||||||||||
Cumulative common distributions | ( | ( | ||||||||||||
Total equity attributable to common shareholders | ||||||||||||||
Noncontrolling interest | ||||||||||||||
Total equity | ||||||||||||||
Total liabilities and equity | $ | $ |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
Rental income | $ | $ | $ | $ | ||||||||||||||||||||||
Expenses: | ||||||||||||||||||||||||||
Real estate taxes | ||||||||||||||||||||||||||
Other operating expenses | ||||||||||||||||||||||||||
Depreciation and amortization | ||||||||||||||||||||||||||
General and administrative | ||||||||||||||||||||||||||
Acquisition and other transaction related costs | ||||||||||||||||||||||||||
Loss on impairment of real estate | ||||||||||||||||||||||||||
Total expenses | ||||||||||||||||||||||||||
Interest and other income | ||||||||||||||||||||||||||
Interest expense (including net amortization of debt issuance costs, premiums and discounts of $ | ( | ( | ( | ( | ||||||||||||||||||||||
Loss on sale of real estate | ( | ( | ||||||||||||||||||||||||
Loss on equity securities | ( | |||||||||||||||||||||||||
Loss on early extinguishment of debt | ( | ( | ( | |||||||||||||||||||||||
Loss before income tax expense and equity in earnings of unconsolidated joint venture | ( | ( | ( | ( | ||||||||||||||||||||||
Income tax expense | ( | ( | ( | ( | ||||||||||||||||||||||
Equity in earnings of unconsolidated joint venture | ||||||||||||||||||||||||||
Net loss | ( | ( | ( | ( | ||||||||||||||||||||||
Net loss attributable to noncontrolling interest | ||||||||||||||||||||||||||
Net loss attributable to common shareholders | ( | ( | ( | ( | ||||||||||||||||||||||
Other comprehensive income: | ||||||||||||||||||||||||||
Unrealized (loss) gain on derivatives | ( | ( | ||||||||||||||||||||||||
Less: unrealized loss (gain) on derivatives attributable to noncontrolling interest | ( | ( | ||||||||||||||||||||||||
Other comprehensive (loss) income attributable to common shareholders | ( | |||||||||||||||||||||||||
Comprehensive loss attributable to common shareholders | $ | ( | $ | ( | $ | ( | $ | ( | ||||||||||||||||||
Weighted average common shares outstanding (basic and diluted) | ||||||||||||||||||||||||||
Per common share data (basic and diluted): | ||||||||||||||||||||||||||
Net loss attributable to common shareholders | $ | ( | $ | ( | $ | ( | $ | ( | ||||||||||||||||||
Cumulative | Total Equity | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Number of | Additional | Other | Cumulative | Attributable to | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Common | Common | Paid In | Cumulative | Comprehensive | Common | Common | Noncontrolling | Total | ||||||||||||||||||||||||||||||||||||||||||||||||
Shares | Shares | Capital | Net Income | Income | Distributions | Shareholders | Interest | Equity | ||||||||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2022 | $ | $ | $ | $ | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | ( | — | — | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Share grants, repurchases and forfeitures | ( | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
Distributions to common shareholders | — | — | — | — | — | ( | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive loss | — | — | — | — | ( | — | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Balance at March 31, 2023 | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | ( | — | — | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Share grants, repurchases and forfeitures | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Distributions to common shareholders | — | — | — | — | — | ( | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
Distributions to noncontrolling interest | — | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Balance at June 30, 2023 | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | ( | — | — | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Share grants, repurchases and forfeitures | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Distributions to common shareholders | — | — | — | — | — | ( | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive loss | — | — | — | — | ( | — | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Balance at September 30, 2023 | $ | $ | $ | $ | $ | ( | $ | $ | $ |
Cumulative | Total Equity | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Number of | Additional | Other | Cumulative | Attributable to | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Common | Common | Paid In | Cumulative | Comprehensive | Common | Common | Noncontrolling | Total | ||||||||||||||||||||||||||||||||||||||||||||||||
Shares | Shares | Capital | Net Income | Income | Distributions | Shareholders | Interest | Equity | ||||||||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2021 | $ | $ | $ | $ | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | ( | — | — | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Share grants, repurchases and forfeitures | ( | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
Contributions from noncontrolling interest | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Distributions to common shareholders | — | — | — | — | — | ( | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Balance at March 31, 2022 | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | ( | — | — | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Share grants, repurchases and forfeitures | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
Distributions to noncontrolling interest | — | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Distributions to common shareholders | — | — | — | — | — | ( | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Balance at June 30, 2022 | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | ( | — | — | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Share grants, repurchases and forfeitures | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
Contributions from noncontrolling interest | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Distributions to common shareholders | — | — | — | — | — | ( | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Balance at September 30, 2022 | $ | $ | $ | $ | $ | ( | $ | $ | $ |
Nine Months Ended September 30, | ||||||||||||||
2023 | 2022 | |||||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||||||||
Net loss | $ | ( | $ | ( | ||||||||||
Adjustments to reconcile net loss to net cash provided by operating activities: | ||||||||||||||
Depreciation | ||||||||||||||
Loss on impairment of real estate | ||||||||||||||
Net amortization of debt issuance costs, premiums and discounts | ||||||||||||||
Amortization of acquired real estate leases and assumed real estate lease obligations | ||||||||||||||
Amortization of deferred leasing costs | ||||||||||||||
Loss on equity securities | ||||||||||||||
Straight line rental income | ( | ( | ||||||||||||
Loss on early extinguishment of debt | ||||||||||||||
Loss on sale of real estate | ||||||||||||||
Proceeds from settlement of derivatives | ( | |||||||||||||
Other non-cash expenses | ||||||||||||||
Distributions of earnings from unconsolidated joint venture | ||||||||||||||
Equity in earnings of unconsolidated joint venture | ( | ( | ||||||||||||
Change in assets and liabilities: | ||||||||||||||
Rents receivable | ( | |||||||||||||
Other assets | ( | |||||||||||||
Accounts payable and other liabilities | ||||||||||||||
Due to related persons | ||||||||||||||
Net cash provided by operating activities | ||||||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||||||||
Real estate acquisitions | ( | |||||||||||||
Real estate improvements | ( | ( | ||||||||||||
Proceeds from sale of marketable securities | ||||||||||||||
Proceeds from sale of real estate | ||||||||||||||
Proceeds from settlement of derivatives | ||||||||||||||
Distributions in excess of earnings from unconsolidated joint venture | ||||||||||||||
Net cash provided by (used in) investing activities | ( | |||||||||||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||||||||
Proceeds from issuance of mortgage notes payable | ||||||||||||||
Repayment of mortgage notes payable | ( | ( | ||||||||||||
Proceeds from secured bridge loan facility | ||||||||||||||
Repayment of secured bridge loan facility | ( | |||||||||||||
Borrowings under revolving credit facility | ||||||||||||||
Repayments of revolving credit facility | ( | |||||||||||||
Payment of debt issuance costs | ( | ( | ||||||||||||
Distributions to common shareholders | ( | ( | ||||||||||||
Proceeds from sale of noncontrolling interest, net | ||||||||||||||
Repurchase of common shares | ( | ( | ||||||||||||
Distributions to noncontrolling interest | ( | ( | ||||||||||||
Net cash provided by financing activities | ||||||||||||||
Increase in cash, cash equivalents and restricted cash | ||||||||||||||
Cash, cash equivalents and restricted cash at beginning of period | ||||||||||||||
Cash, cash equivalents and restricted cash at end of period | $ | $ |
SUPPLEMENTAL DISCLOSURES: | ||||||||||||||
Interest paid | $ | $ | ||||||||||||
Income taxes paid | $ | $ | ||||||||||||
Interest capitalized | $ | $ | ||||||||||||
NON-CASH INVESTING ACTIVITIES: | ||||||||||||||
Real estate acquired by assumption of mortgage notes payable | $ | $ | ||||||||||||
Real estate improvements accrued not paid | $ | $ | ||||||||||||
NON-CASH FINANCING ACTIVITIES: | ||||||||||||||
Assumption of mortgage notes payable | $ | $ | ( | |||||||||||
SUPPLEMENTAL DISCLOSURE OF CASH, CASH EQUIVALENTS AND RESTRICTED CASH: | ||||||||||||||
The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheets to the amounts shown in the condensed consolidated statements of cash flows: | ||||||||||||||
As of September 30, | ||||||||||||||
2023 | 2022 | |||||||||||||
Cash and cash equivalents | $ | $ | ||||||||||||
Restricted cash (1) | ||||||||||||||
Total cash, cash equivalents and restricted cash shown in the statements of cash flows | $ | $ |
Number of | Principal Balance at | Carrying Value of Collateral at | ||||||||||||||||||||||||||||||||||||||||||||||||
Properties | September 30, | December 31, | Interest | September 30, | December 31, | |||||||||||||||||||||||||||||||||||||||||||||
Entity | Secured By | 2023 | 2022 | Rate (1) | Type | Maturity | 2023 | 2022 | ||||||||||||||||||||||||||||||||||||||||||
ILPT | $ | $ | Floating | 10/9/2024 | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||
ILPT | Fixed | 2/7/2029 | ||||||||||||||||||||||||||||||||||||||||||||||||
ILPT | Fixed | 3/9/2032 | ||||||||||||||||||||||||||||||||||||||||||||||||
Mountain JV | Floating | 3/9/2024 | ||||||||||||||||||||||||||||||||||||||||||||||||
Mountain JV | Fixed | 6/10/2030 | ||||||||||||||||||||||||||||||||||||||||||||||||
Mountain JV | Fixed | 5/1/2031 | ||||||||||||||||||||||||||||||||||||||||||||||||
Mountain JV | Fixed | 7/1/2032 | ||||||||||||||||||||||||||||||||||||||||||||||||
Mountain JV | Fixed | 10/1/2033 | ||||||||||||||||||||||||||||||||||||||||||||||||
Mountain JV | Fixed | 11/1/2033 | ||||||||||||||||||||||||||||||||||||||||||||||||
Mountain JV | Fixed | 6/1/2035 | ||||||||||||||||||||||||||||||||||||||||||||||||
Mountain JV | Fixed | 1/1/2036 | ||||||||||||||||||||||||||||||||||||||||||||||||
Mountain JV | Fixed | 11/1/2037 | ||||||||||||||||||||||||||||||||||||||||||||||||
Mountain JV | Fixed | 1/1/2038 | ||||||||||||||||||||||||||||||||||||||||||||||||
Mountain JV | N/A | Fixed | 10/1/2028 | |||||||||||||||||||||||||||||||||||||||||||||||
Mountain JV | N/A | Fixed | 4/1/2030 | |||||||||||||||||||||||||||||||||||||||||||||||
Mountain JV | N/A | Fixed | 4/1/2030 | |||||||||||||||||||||||||||||||||||||||||||||||
Mountain JV | N/A | Fixed | 9/1/2030 | |||||||||||||||||||||||||||||||||||||||||||||||
Total / weighted average | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||
Unamortized debt issuance costs | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||
Total indebtedness, net | $ | $ |
At September 30, 2023 | At December 31, 2022 | |||||||||||||||||||||||||
Carrying | Carrying | |||||||||||||||||||||||||
Value (1) | Fair Value | Value (1) | Fair Value | |||||||||||||||||||||||
Fixed rate loan, | $ | $ | $ | $ | ||||||||||||||||||||||
Fixed rate loan, | ||||||||||||||||||||||||||
Fixed rate loan, | ||||||||||||||||||||||||||
Fixed rate loan, | ||||||||||||||||||||||||||
Fixed rate loan, | ||||||||||||||||||||||||||
Fixed rate loan, | ||||||||||||||||||||||||||
Fixed rate loan, | ||||||||||||||||||||||||||
Fixed rate loan, | ||||||||||||||||||||||||||
Fixed rate loan, | ||||||||||||||||||||||||||
Fixed rate loan, | ||||||||||||||||||||||||||
Fixed rate loan, | ||||||||||||||||||||||||||
Fixed rate loan, | ||||||||||||||||||||||||||
Fixed rate loan, | ||||||||||||||||||||||||||
Fixed rate loan, | ||||||||||||||||||||||||||
Fixed rate loan, | ||||||||||||||||||||||||||
$ | $ | $ | $ |
Quoted Prices in | Significant Other | Significant | ||||||||||||||||||||||||
Active Markets for | Observable | Unobservable | ||||||||||||||||||||||||
Identical Assets | Inputs | Inputs | ||||||||||||||||||||||||
Total | (Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||||||
At September 30, 2023 | ||||||||||||||||||||||||||
Recurring fair value measurements | ||||||||||||||||||||||||||
Investment in unconsolidated joint venture | $ | $ | $ | $ | ||||||||||||||||||||||
Interest rate cap derivatives (1) | $ | $ | $ | $ | ||||||||||||||||||||||
Non-recurring fair value measurements | ||||||||||||||||||||||||||
Real estate properties (2) | $ | $ | $ | $ | ||||||||||||||||||||||
At December 31, 2022 | ||||||||||||||||||||||||||
Recurring fair value measurements | ||||||||||||||||||||||||||
Investment in unconsolidated joint venture | $ | $ | $ | $ | ||||||||||||||||||||||
Interest rate cap derivatives (1) | $ | $ | $ | $ | ||||||||||||||||||||||
Non-recurring fair value measurements | ||||||||||||||||||||||||||
Real estate properties (2) | $ | $ | $ | $ |
Exit | ||||||||||||||||||||||||||
Capitalization | ||||||||||||||||||||||||||
Valuation Technique | Discount Rates | Rates | Holding Periods | |||||||||||||||||||||||
At September 30, 2023 | ||||||||||||||||||||||||||
Investment in unconsolidated joint venture | Discounted cash flow | |||||||||||||||||||||||||
At December 31, 2022 | ||||||||||||||||||||||||||
Investment in unconsolidated joint venture | Discounted cash flow |
Three Months | Nine Months | |||||||||||||||||||||||||
Ended September 30, | Ended September 30, | |||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
Beginning balance | $ | $ | $ | $ | ||||||||||||||||||||||
Equity in earnings of unconsolidated joint venture | ||||||||||||||||||||||||||
Distributions from unconsolidated joint venture | ( | ( | ( | ( | ||||||||||||||||||||||
Ending balance | $ | $ | $ | $ | ||||||||||||||||||||||
Declaration Date | Record Date | Payment Date | Distribution Per Share | Total Distribution | ||||||||||||||||||||||
January 12, 2023 | January 23, 2023 | February 16, 2023 | $ | $ | ||||||||||||||||||||||
April 13, 2023 | April 24, 2023 | May 18, 2023 | ||||||||||||||||||||||||
July 13, 2023 | July 24, 2023 | August 17, 2023 | ||||||||||||||||||||||||
$ | $ |
Interest Rate | Balance Sheet | Strike | Notional | Fair Value at | ||||||||||||||||||||||||||||||||||
Derivative | Line Item | Underlying Instrument | Rate | Amount | September 30, 2023 | December 31, 2022 | ||||||||||||||||||||||||||||||||
Interest rate cap | Other assets | Floating Rate Loan | $ | $ | $ | |||||||||||||||||||||||||||||||||
Interest rate cap | Other assets | ILPT Floating Rate Loan | $ | |||||||||||||||||||||||||||||||||||
$ | $ |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
Amount of gain recognized in cumulative other comprehensive income | $ | $ | $ | $ | ||||||||||||||||||||||
Amount reclassified from cumulative other comprehensive income into interest expense | ( | ( | ||||||||||||||||||||||||
Amount reclassified from cumulative other comprehensive income into loss on early extinguishment of debt | ( | ( | ||||||||||||||||||||||||
Unrealized (loss) gain on derivative instrument recognized in cumulative other comprehensive loss | $ | ( | $ | $ | ( | $ |
All Properties | Comparable Properties (1) | |||||||||||||||||||||||||
As of September 30, | As of September 30, | |||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
Total properties | 413 | 413 | 285 | 285 | ||||||||||||||||||||||
Total rentable square feet (in thousands) (2) | 59,983 | 59,962 | 33,462 | 33,440 | ||||||||||||||||||||||
Percent leased (3) | 98.9 | % | 99.2 | % | 98.8 | % | 99.3 | % |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
Average effective rental rates per square foot leased: (1) | ||||||||||||||||||||||||||
All properties | $ | 7.44 | $ | 6.96 | $ | 7.40 | $ | 6.96 | ||||||||||||||||||
Comparable properties (2) | $ | 7.42 | $ | 6.95 | $ | 6.73 | $ | 6.43 |
Three Months Ended September 30, 2023 | |||||||||||||||||
New Leases | Renewals | Totals | |||||||||||||||
Square feet leased during the period (in thousands) | 64 | 694 | 758 | ||||||||||||||
Weighted average rental rate change (by rentable square feet) | (15.7) | % | 16.9 | % | 13.5 | % | |||||||||||
Weighted average lease term by square feet (years) | 4.9 | 4.0 | 4.1 | ||||||||||||||
Total leasing costs and concession commitments (1) | $ | 140 | $ | 1,301 | $ | 1,441 | |||||||||||
Total leasing costs and concession commitments per square foot (1) | $ | 2.21 | $ | 1.87 | $ | 1.90 | |||||||||||
Total leasing costs and concession commitments per square foot per year (1) | $ | 0.45 | $ | 0.47 | $ | 0.46 |
Nine Months Ended September 30, 2023 | |||||||||||||||||
New Leases | Renewals | Totals | |||||||||||||||
Square feet leased during the period (in thousands) | 594 | 2,892 | 3,486 | ||||||||||||||
Weighted average rental rate change (by rentable square feet) | 29.9 | % | 18.1 | % | 20.1 | % | |||||||||||
Weighted average lease term by square feet (years) | 11.3 | 7.2 | 7.8 | ||||||||||||||
Total leasing costs and concession commitments (1) | $ | 3,220 | $ | 4,053 | $ | 7,273 | |||||||||||
Total leasing costs and concession commitments per square foot (1) | $ | 5.43 | $ | 1.40 | $ | 2.09 | |||||||||||
Total leasing costs and concession commitments per square foot per year (1) | $ | 0.48 | $ | 0.20 | $ | 0.27 |
% of Total | Cumulative | |||||||||||||||||||||||||||||||||||||||||||
% of Total | Cumulative % | Annualized | Annualized | % of Total | ||||||||||||||||||||||||||||||||||||||||
Leased | Leased | of Total | Rental | Rental | Annualized | |||||||||||||||||||||||||||||||||||||||
Number of | Square Feet | Square Feet | Square Feet | Revenues | Revenues | Rental Revenues | ||||||||||||||||||||||||||||||||||||||
Year | Tenants | Expiring (1) | Expiring (1) | Expiring (1) | Expiring | Expiring | Expiring | |||||||||||||||||||||||||||||||||||||
2023 | 9 | 489 | 0.8 | % | 0.8 | % | $ | 3,903 | 0.9 | % | 0.9 | % | ||||||||||||||||||||||||||||||||
2024 | 45 | 5,909 | 10.0 | % | 10.8 | % | 29,702 | 6.9 | % | 7.8 | % | |||||||||||||||||||||||||||||||||
2025 | 35 | 4,802 | 8.1 | % | 18.9 | % | 28,591 | 6.6 | % | 14.4 | % | |||||||||||||||||||||||||||||||||
2026 | 30 | 4,147 | 7.0 | % | 25.9 | % | 28,247 | 6.5 | % | 20.9 | % | |||||||||||||||||||||||||||||||||
2027 | 37 | 8,694 | 14.7 | % | 40.6 | % | 52,333 | 12.1 | % | 33.0 | % | |||||||||||||||||||||||||||||||||
2028 | 41 | 6,075 | 10.2 | % | 50.8 | % | 44,948 | 10.4 | % | 43.4 | % | |||||||||||||||||||||||||||||||||
2029 | 22 | 4,378 | 7.4 | % | 58.2 | % | 23,391 | 5.4 | % | 48.8 | % | |||||||||||||||||||||||||||||||||
2030 | 16 | 2,519 | 4.2 | % | 62.4 | % | 21,092 | 4.9 | % | 53.7 | % | |||||||||||||||||||||||||||||||||
2031 | 17 | 3,265 | 5.5 | % | 67.9 | % | 25,592 | 5.9 | % | 59.6 | % | |||||||||||||||||||||||||||||||||
2032 | 37 | 3,615 | 6.1 | % | 74.0 | % | 35,455 | 8.2 | % | 67.8 | % | |||||||||||||||||||||||||||||||||
Thereafter | 109 | 15,423 | 26.0 | % | 100.0 | % | 139,830 | 32.2 | % | 100.0 | % | |||||||||||||||||||||||||||||||||
Total | 398 | 59,316 | 100.0 | % | $ | 433,084 | 100.0 | % | ||||||||||||||||||||||||||||||||||||
Weighted average remaining lease term (in years) | 7.1 | 8.2 |
Annualized | ||||||||
Rental Revenues | ||||||||
Scheduled to Reset | ||||||||
Scheduled Rent Reset Year for Hawaii Properties | as of September 30, 2023 | |||||||
2023 | $ | — | ||||||
2024 | 1,150 | |||||||
2025 | 989 | |||||||
2026 | 1,315 | |||||||
2027 | 795 | |||||||
2028 and thereafter | 17,605 | |||||||
Total | $ | 21,854 |
Comparable Properties Results (1) | Non-Comparable Properties Results (2) | Consolidated Results | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Three Months Ended September 30, | Three Months Ended September 30, | Three Months Ended September 30, | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
$ | % | $ | $ | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2023 | 2022 | Change | Change | 2023 | 2022 | Change | 2023 | 2022 | Change | Change | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Rental income | $ | 108,571 | $ | 101,704 | $ | 6,867 | 6.8% | $ | 1,571 | $ | 1,511 | $ | 60 | $ | 110,142 | $ | 103,215 | $ | 6,927 | 6.7% | |||||||||||||||||||||||||||||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Real estate taxes | 14,734 | 13,535 | 1,199 | 8.9% | 192 | 214 | (22) | 14,926 | 13,749 | 1,177 | 8.6% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other operating expenses | 9,772 | 8,299 | 1,473 | 17.7% | 135 | 154 | (19) | 9,907 | 8,453 | 1,454 | 17.2% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total operating expenses | 24,506 | 21,834 | 2,672 | 12.2% | 327 | 368 | (41) | 24,833 | 22,202 | 2,631 | 11.9% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net operating income (3) | $ | 84,065 | $ | 79,870 | $ | 4,195 | 5.3% | $ | 1,244 | $ | 1,143 | $ | 101 | 85,309 | 81,013 | 4,296 | 5.3% | ||||||||||||||||||||||||||||||||||||||||||||||||
Other expenses: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Depreciation and amortization | 43,912 | 48,519 | (4,607) | (9.5)% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
General and administrative | 7,712 | 9,110 | (1,398) | (15.3)% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Acquisition and other transaction related costs | — | 586 | (586) | (100.0)% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total other expenses | 51,624 | 58,215 | (6,591) | (11.3)% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest and other income | 2,397 | 1,068 | 1,329 | 124.4% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest expense | (72,941) | (89,739) | 16,798 | (18.7)% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loss on early extinguishment of debt | — | (21,370) | 21,370 | (100.0)% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loss before income tax expense and equity in earnings of unconsolidated joint venture | (36,859) | (87,243) | 50,384 | (57.8)% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income tax expense | (51) | (28) | (23) | 82.1% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity in earnings of unconsolidated joint venture | 719 | 3,297 | (2,578) | (78.2)% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net loss | (36,191) | (83,974) | 47,783 | (56.9)% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net loss attributable to noncontrolling interest | 10,079 | 38,347 | (28,268) | (73.7)% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net loss attributable to common shareholders | $ | (26,112) | $ | (45,627) | $ | 19,515 | (42.8)% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Weighted average common shares outstanding (basic and diluted) | 65,488 | 65,250 | 238 | 0.4% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Per common share data (basic and diluted): | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net loss attributable to common shareholders | $ | (0.40) | $ | (0.70) | $ | 0.30 | (42.9)% |
Comparable Properties Results (1) | Non-Comparable Properties Results (2) | Consolidated Results | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Nine Months Ended September 30, | Nine Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
$ | % | $ | $ | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2023 | 2022 | Change | Change | 2023 | 2022 | Change | 2023 | 2022 | Change | Change | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Rental income | $ | 166,912 | $ | 160,004 | $ | 6,908 | 4.3% | $ | 161,531 | $ | 121,808 | $ | 39,723 | $ | 328,443 | $ | 281,812 | $ | 46,631 | 16.5% | |||||||||||||||||||||||||||||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Real estate taxes | 23,087 | 21,761 | 1,326 | 6.1% | 23,406 | 14,699 | 8,707 | 46,493 | 36,460 | 10,033 | 27.5% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other operating expenses | 14,944 | 13,611 | 1,333 | 9.8% | 12,800 | 8,667 | 4,133 | 27,744 | 22,278 | 5,466 | 24.5% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total operating expenses | 38,031 | 35,372 | 2,659 | 7.5% | 36,206 | 23,366 | 12,840 | 74,237 | 58,738 | 15,499 | 26.4% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net operating income (3) | $ | 128,881 | $ | 124,632 | $ | 4,249 | 3.4% | $ | 125,325 | $ | 98,442 | $ | 26,883 | 254,206 | 223,074 | 31,132 | 14.0% | ||||||||||||||||||||||||||||||||||||||||||||||||
Other expenses: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Depreciation and amortization | 134,278 | 114,096 | 20,182 | 17.7% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
General and administrative | 23,750 | 24,896 | (1,146) | (4.6)% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Acquisition and other transaction related costs | — | 586 | (586) | (100.0)% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loss on impairment of real estate | 254 | 100,747 | (100,493) | (99.7)% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total other expenses | 158,282 | 240,325 | (82,043) | (34.1)% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest and other income | 5,340 | 1,900 | 3,440 | 181.1% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest expense | (215,558) | (208,286) | (7,272) | 3.5% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loss on sale of real estate | (974) | (10) | (964) | n/m | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loss on equity securities | — | (5,758) | 5,758 | (100.0)% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loss on early extinguishment of debt | (359) | (22,198) | 21,839 | (98.4)% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loss before income tax expense and equity in earnings of unconsolidated joint venture | (115,627) | (251,603) | 135,976 | (54.0)% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income tax expense | (113) | (113) | — | —% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity in earnings of unconsolidated joint venture | 7,423 | 6,634 | 789 | 11.9% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net loss | (108,317) | (245,082) | 136,765 | (55.8)% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net loss attributable to noncontrolling interest | 31,568 | 49,402 | (17,834) | (36.1)% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net loss attributable to common shareholders | $ | (76,749) | $ | (195,680) | $ | 118,931 | (60.8)% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Weighted average common shares outstanding (basic and diluted) | 65,389 | 65,228 | 161 | 0.2% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Per common share data (basic and diluted): | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net loss attributable to common shareholders | $ | (1.17) | $ | (3.00) | $ | 1.83 | (61.0)% |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
Net loss | $ | (36,191) | $ | (83,974) | $ | (108,317) | $ | (245,082) | ||||||||||||||||||
Equity in earnings of unconsolidated joint venture | (719) | (3,297) | (7,423) | (6,634) | ||||||||||||||||||||||
Income tax expense | 51 | 28 | 113 | 113 | ||||||||||||||||||||||
Loss before income tax expense and equity in earnings of unconsolidated joint venture | (36,859) | (87,243) | (115,627) | (251,603) | ||||||||||||||||||||||
Loss on early extinguishment of debt | — | 21,370 | 359 | 22,198 | ||||||||||||||||||||||
Interest and other income | (2,397) | (1,068) | (5,340) | (1,900) | ||||||||||||||||||||||
Interest expense | 72,941 | 89,739 | 215,558 | 208,286 | ||||||||||||||||||||||
Loss on sale of real estate | — | — | 974 | 10 | ||||||||||||||||||||||
Loss on equity securities | — | — | — | 5,758 | ||||||||||||||||||||||
General and administrative | 7,712 | 9,110 | 23,750 | 24,896 | ||||||||||||||||||||||
Acquisition and other transaction related costs | — | 586 | — | 586 | ||||||||||||||||||||||
Loss on impairment of real estate | — | — | 254 | 100,747 | ||||||||||||||||||||||
Depreciation and amortization | 43,912 | 48,519 | 134,278 | 114,096 | ||||||||||||||||||||||
NOI | $ | 85,309 | $ | 81,013 | $ | 254,206 | $ | 223,074 | ||||||||||||||||||
NOI: | ||||||||||||||||||||||||||
Hawaii Properties | $ | 22,572 | $ | 20,049 | $ | 67,313 | $ | 64,087 | ||||||||||||||||||
Mainland Properties | 62,737 | 60,964 | 186,893 | 158,987 | ||||||||||||||||||||||
NOI | $ | 85,309 | $ | 81,013 | $ | 254,206 | $ | 223,074 |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
Net loss attributable to common shareholders | $ | (26,112) | $ | (45,627) | $ | (76,749) | $ | (195,680) | ||||||||||||||||||
Depreciation and amortization | 43,912 | 48,519 | 134,278 | 114,096 | ||||||||||||||||||||||
Equity in earnings of unconsolidated joint venture | (719) | (3,297) | (7,423) | (6,634) | ||||||||||||||||||||||
Loss on equity securities | — | — | — | 5,758 | ||||||||||||||||||||||
Share of FFO from unconsolidated joint venture | 1,446 | 1,678 | 4,416 | 5,115 | ||||||||||||||||||||||
Loss on impairment of real estate | — | — | 254 | 100,747 | ||||||||||||||||||||||
Loss on sale of real estate | — | — | 974 | 10 | ||||||||||||||||||||||
FFO adjustments attributable to noncontrolling interest | (10,582) | (11,407) | (32,514) | (27,445) | ||||||||||||||||||||||
FFO attributable to common shareholders | 7,945 | (10,134) | 23,236 | (4,033) | ||||||||||||||||||||||
Loss on early extinguishment of debt | — | 21,370 | 359 | 22,198 | ||||||||||||||||||||||
Acquisition, transaction related and certain other financing costs (1) | — | 32,016 | — | 80,992 | ||||||||||||||||||||||
Normalized FFO adjustments attributable to noncontrolling interest | — | (28,379) | (140) | (28,379) | ||||||||||||||||||||||
Normalized FFO attributable to common shareholders | $ | 7,945 | $ | 14,873 | $ | 23,455 | $ | 70,778 | ||||||||||||||||||
Weighted average common shares outstanding (basic and diluted) | 65,488 | 65,250 | 65,389 | 65,228 | ||||||||||||||||||||||
Per common share data (basic and diluted): | ||||||||||||||||||||||||||
FFO attributable to common shareholders | $ | 0.12 | $ | (0.16) | $ | 0.36 | $ | (0.06) | ||||||||||||||||||
Normalized FFO attributable to common shareholders | $ | 0.12 | $ | 0.23 | $ | 0.36 | $ | 1.09 |
Nine Months Ended September 30, | ||||||||||||||
2023 | 2022 | |||||||||||||
Cash and cash equivalents and restricted cash at beginning of period | $ | 140,780 | $ | 29,397 | ||||||||||
Net cash provided by (used in): | ||||||||||||||
Operating activities | 14,063 | 81,907 | ||||||||||||
Investing activities | 31,420 | (3,457,034) | ||||||||||||
Financing activities | 36,240 | 3,472,399 | ||||||||||||
Cash and cash equivalents and restricted cash at end of period | $ | 222,503 | $ | 126,669 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Tenant improvements and leasing costs (1) | $ | 1,241 | $ | 2,302 | $ | 5,779 | $ | 8,290 | |||||||||||||||
Building improvements (2) | 2,720 | 1,292 | 4,373 | 1,778 | |||||||||||||||||||
Development, redevelopment and other activities (3) | 1,314 | 4,980 | 7,705 | 12,351 | |||||||||||||||||||
$ | 5,275 | $ | 8,574 | $ | 17,857 | $ | 22,419 |
Annual | Annual | Interest | ||||||||||||||||||||||||||||||
Principal | Interest | Interest | Payments | |||||||||||||||||||||||||||||
Debt | Balance | Rate (1) | Expense (1) | Maturity | Due | |||||||||||||||||||||||||||
ILPT Floating Rate Loan | $ | 1,235,000 | 6.18 | % | $ | 77,383 | 2024 | Monthly | ||||||||||||||||||||||||
Floating Rate Loan | 1,400,000 | 6.17 | % | 87,580 | 2024 | Monthly | ||||||||||||||||||||||||||
$ | 2,635,000 | $ | 164,963 | |||||||||||||||||||||||||||||
Impact of an Increase in Interest Rates | ||||||||||||||||||||||||||
Total Interest | Annual | |||||||||||||||||||||||||
Interest Rate | Outstanding | Expense | Earnings Per | |||||||||||||||||||||||
Per Year | Debt | Per Year | Share Impact (1) | |||||||||||||||||||||||
At September 30, 2023 | 6.17 | % | $ | 2,635,000 | $ | 164,963 | $ | 2.52 | ||||||||||||||||||
One percentage point increase | 7.17 | % | $ | 2,635,000 | $ | 191,679 | $ | 2.93 |
Annual | Annual | Interest | ||||||||||||||||||||||||||||||
Principal | Interest | Interest | Payments | |||||||||||||||||||||||||||||
Debt | Balance | Rate (1) | Expense (1) | Maturity | Due | |||||||||||||||||||||||||||
Mortgage notes (186 Hawaii Properties) | $ | 650,000 | 4.31 | % | $ | 28,015 | 2029 | Monthly | ||||||||||||||||||||||||
Mortgage notes (17 Mainland Properties) | 700,000 | 4.42 | % | 30,940 | 2032 | Monthly | ||||||||||||||||||||||||||
Mortgage note (2) | 91,000 | 6.25 | % | 5,688 | 2030 | Monthly | ||||||||||||||||||||||||||
Mortgage note (3) | 11,712 | 3.67 | % | 430 | 2031 | Monthly | ||||||||||||||||||||||||||
Mortgage note (3) | 13,228 | 4.14 | % | 548 | 2032 | Monthly | ||||||||||||||||||||||||||
Mortgage note (3) | 29,213 | 4.02 | % | 1,174 | 2033 | Monthly | ||||||||||||||||||||||||||
Mortgage note (3) | 40,832 | 4.13 | % | 1,686 | 2033 | Monthly | ||||||||||||||||||||||||||
Mortgage note (3) | 24,873 | 3.10 | % | 771 | 2035 | Monthly | ||||||||||||||||||||||||||
Mortgage note (3) | 40,087 | 2.95 | % | 1,183 | 2036 | Monthly | ||||||||||||||||||||||||||
Mortgage note (3) | 44,423 | 4.27 | % | 1,897 | 2037 | Monthly | ||||||||||||||||||||||||||
Mortgage note (3) | 50,002 | 3.25 | % | 1,625 | 2038 | Monthly | ||||||||||||||||||||||||||
$ | 1,695,370 | $ | 73,957 |
Maximum | ||||||||||||||||||||||||||
Total Number of | Approximate Dollar | |||||||||||||||||||||||||
Shares Purchased | Value of Shares that | |||||||||||||||||||||||||
Number of | Average | as Part of Publicly | May Yet Be Purchased | |||||||||||||||||||||||
Shares | Price Paid | Announced Plans | Under the Plans or | |||||||||||||||||||||||
Calendar Month | Purchased (1) | per Share | or Programs | Programs | ||||||||||||||||||||||
July 1, 2023 - July 31, 2023 | 1,017 | $ | 3.65 | — | $ | — | ||||||||||||||||||||
September 1, 2023 - September 30, 2023 | 39,619 | $ | 3.54 | — | $ | — | ||||||||||||||||||||
Total | 40,636 | $ | 3.54 | — | $ | — |
Exhibit Number | Description | ||||
3.1 | |||||
3.2 | |||||
4.1 | |||||
10.1 | |||||
10.2 | |||||
31.1 | |||||
31.2 | |||||
31.3 | |||||
31.4 | |||||
32.1 | |||||
101.INS | XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. | ||||
101.SCH | XBRL Taxonomy Extension Schema Document. (Filed herewith.) | ||||
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document. (Filed herewith.) | ||||
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document. (Filed herewith.) | ||||
101.LAB | XBRL Taxonomy Extension Label Linkbase Document. (Filed herewith.) | ||||
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document. (Filed herewith.) | ||||
104 | Cover Page Interactive Data File. (Formatted as Inline XBRL and contained in Exhibit 101.) | ||||
INDUSTRIAL LOGISTICS PROPERTIES TRUST | ||||||||
By: | /s/ Yael Duffy | |||||||
Yael Duffy | ||||||||
President and Chief Operating Officer | ||||||||
Dated: October 25, 2023 | ||||||||
By: | /s/ Tiffany R. Sy | |||||||
Tiffany R. Sy | ||||||||
Chief Financial Officer and Treasurer | ||||||||
(Principal Financial Officer and Principal Accounting Officer) | ||||||||
Dated: October 25, 2023 |
Industrial Logistics Properties Trust | ||||||||
By: | ||||||||
Name: | ||||||||
Title | ||||||||
RECIPIENT: | ||||||||
«NAME» | ||||||||
«ADDRESS» | ||||||||
«CITY», «ST» «ZIP» | ||||||||
INDUSTRIAL LOGISTICS PROPERTIES TRUST | ||||||||
By: | ||||||||
Name: | ||||||||
Title: | ||||||||
[INDEMNITEE] | ||||||||
Indemnitee’s Address: | ||||||||
WITNESS: | ||||||||
Print name of witness | Print name of witness | |||||||
Name of Signatory | Date | ||||
Tiffany Sy | October 1, 2023 | ||||
Matthew P. Jordan | June 1, 2022 | ||||
June S. Youngs | March 28, 2022 | ||||
Yael Duffy | March 2, 2020 | ||||
Kevin C. Phelan | February 21, 2020 | ||||
Bruce M. Gans | January 11, 2018 | ||||
Lisa Harris Jones | January 11, 2018 | ||||
Joseph L. Morea | January 11, 2018 | ||||
Adam D. Portnoy | January 11, 2018 |
5 | ||||||||||||||
Date: October 25, 2023 | /s/ Adam D. Portnoy | |||||||||||||
Adam D. Portnoy | ||||||||||||||
Managing Trustee |
5 | ||||||||||||||
Date: October 25, 2023 | /s/ Matthew P. Jordan | |||||||||||||
Matthew P. Jordan | ||||||||||||||
Managing Trustee |
5 | ||||||||||||||
Date: October 25, 2023 | /s/ Yael Duffy | |||||||||||||
Yael Duffy | ||||||||||||||
President and Chief Operating Officer |
5 | ||||||||||||||
Date: October 25, 2023 | /s/ Tiffany R. Sy | |||||||||||||
Tiffany R. Sy | ||||||||||||||
Chief Financial Officer and Treasurer |
9 | ||||||||
/s/ Adam D. Portnoy | /s/ Yael Duffy | |||||||
Adam D. Portnoy | Yael Duffy | |||||||
Managing Trustee | President and Chief Operating Officer | |||||||
/s/ Matthew P. Jordan | /s/ Tiffany R. Sy | |||||||
Matthew P. Jordan | Tiffany R. Sy | |||||||
Managing Trustee | Chief Financial Officer and Treasurer | |||||||
Date: October 25, 2023 |
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands |
Sep. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Straight line rents | $ 91,218 | $ 80,710 |
Common stock, par value per share (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common shares, shares issued (in shares) | 65,845,073 | 65,568,145 |
Common shares, shares outstanding (in shares) | 65,845,073 | 65,568,145 |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) shares in Thousands, $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Revenues [Abstract] | ||||
Rental income | $ 110,142 | $ 103,215 | $ 328,443 | $ 281,812 |
Expenses: | ||||
Real estate taxes | 14,926 | 13,749 | 46,493 | 36,460 |
Other operating expenses | 9,907 | 8,453 | 27,744 | 22,278 |
Depreciation and amortization | 43,912 | 48,519 | 134,278 | 114,096 |
General and administrative | 7,712 | 9,110 | 23,750 | 24,896 |
Acquisition and other transaction related costs | 0 | 586 | 0 | 586 |
Loss on impairment of real estate | 0 | 0 | 254 | 100,747 |
Total expenses | 76,457 | 80,417 | 232,519 | 299,063 |
Interest and other income | 2,397 | 1,068 | 5,340 | 1,900 |
Interest expense (including net amortization of debt issuance costs, premiums and discounts of $6,743, $35,496, $20,177, and $90,265, respectively) | (72,941) | (89,739) | (215,558) | (208,286) |
Loss on sale of real estate | 0 | 0 | (974) | (10) |
Loss on equity securities | 0 | 0 | 0 | (5,758) |
Loss on early extinguishment of debt | 0 | (21,370) | (359) | (22,198) |
Loss before income tax expense and equity in earnings of unconsolidated joint venture | (36,859) | (87,243) | (115,627) | (251,603) |
Income tax expense | (51) | (28) | (113) | (113) |
Equity in earnings of unconsolidated joint venture | 3,297 | 7,423 | 6,634 | |
Net loss | (36,191) | (83,974) | (108,317) | (245,082) |
Net loss attributable to noncontrolling interest | 10,079 | 38,347 | 31,568 | 49,402 |
Net loss attributable to common shareholders | (26,112) | (45,627) | (76,749) | (195,680) |
Other comprehensive income: | ||||
Unrealized (loss) gain on derivative instrument recognized in cumulative other comprehensive loss | (6,635) | 8,847 | (3,392) | 18,917 |
Less: unrealized loss (gain) on derivatives attributable to noncontrolling interest | 2,290 | (4,119) | 3,631 | (6,617) |
Other comprehensive (loss) income attributable to common shareholders | (4,345) | 4,728 | 239 | 12,300 |
Comprehensive loss attributable to common shareholders | $ (30,457) | $ (40,899) | $ (76,510) | $ (183,380) |
Weighted average common shares outstanding - basic (in shares) | 65,488 | 65,250 | 65,389 | 65,228 |
Weighted average common shares outstanding - diluted (in shares) | 65,488 | 65,250 | 65,389 | 65,228 |
Per common share data (basic and diluted): | ||||
Net loss attributable to common shareholders, basic (in dollars per share) | $ (0.40) | $ (0.70) | $ (1.17) | $ (3.00) |
Net loss attributable to common shareholders, diluted (in dollars per share) | $ (0.40) | $ (0.70) | $ (1.17) | $ (3.00) |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Parenthetical) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Income Statement [Abstract] | ||||
Amortization of debt issuance costs and premium | $ 6,743 | $ 35,496 | $ 20,177 | $ 90,265 |
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) $ in Thousands |
Total |
Total Equity Attributable to Common Shareholders |
Common shares |
Additional Paid-in Capital |
Cumulative Net Income |
Cumulative Other Comprehensive Income |
Cumulative Common Distributions |
Total Attributable to Noncontrolling Interest |
---|---|---|---|---|---|---|---|---|
Beginning balance (in shares) at Dec. 31, 2021 | 65,404,592 | |||||||
Beginning balance at Dec. 31, 2021 | $ 1,038,042 | $ 1,038,042 | $ 654 | $ 1,012,224 | $ 343,908 | $ 0 | $ (318,744) | $ 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net loss | (9,787) | (6,514) | (6,514) | (3,273) | ||||
Share grants, repurchases and forfeitures (in shares) | (733) | |||||||
Share grants, repurchases and forfeitures | 398 | 398 | 398 | |||||
Other comprehensive income (loss) | 5,632 | 3,908 | 3,908 | 1,724 | ||||
Contributions from noncontrolling interest | 591,268 | 591,268 | ||||||
Distributions to common shareholders | (21,584) | (21,584) | (21,584) | |||||
Ending balance (in shares) at Mar. 31, 2022 | 65,403,859 | |||||||
Ending balance at Mar. 31, 2022 | 1,603,969 | 1,014,250 | $ 654 | 1,012,622 | 337,394 | 3,908 | (340,328) | 589,719 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net loss | (151,321) | (143,539) | (143,539) | (7,782) | ||||
Share grants, repurchases and forfeitures (in shares) | 23,600 | |||||||
Share grants, repurchases and forfeitures | 796 | 796 | 796 | |||||
Other comprehensive income (loss) | 4,438 | 3,664 | 3,664 | 774 | ||||
Distributions to noncontrolling interest | (1,365) | (1,365) | ||||||
Distributions to common shareholders | (21,583) | (21,583) | (21,583) | |||||
Ending balance (in shares) at Jun. 30, 2022 | 65,427,459 | |||||||
Ending balance at Jun. 30, 2022 | 1,434,934 | 853,588 | $ 654 | 1,013,418 | 193,855 | 7,572 | (361,911) | 581,346 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net loss | (83,974) | (45,627) | (45,627) | (38,347) | ||||
Share grants, repurchases and forfeitures (in shares) | 141,245 | |||||||
Share grants, repurchases and forfeitures | 386 | 386 | $ 2 | 384 | ||||
Other comprehensive income (loss) | 8,847 | 4,728 | 4,728 | 4,119 | ||||
Contributions from noncontrolling interest | 1,971 | 1,971 | ||||||
Distributions to common shareholders | (654) | (654) | (654) | |||||
Ending balance (in shares) at Sep. 30, 2022 | 65,568,704 | |||||||
Ending balance at Sep. 30, 2022 | $ 1,361,510 | 812,421 | $ 656 | 1,013,802 | 148,228 | 12,300 | (362,565) | 549,089 |
Beginning balance (in shares) at Dec. 31, 2022 | 65,568,145 | 65,568,145 | ||||||
Beginning balance at Dec. 31, 2022 | $ 1,330,771 | 790,724 | $ 656 | 1,014,201 | 117,185 | 21,903 | (363,221) | 540,047 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net loss | (35,546) | (24,809) | (24,809) | (10,737) | ||||
Share grants, repurchases and forfeitures (in shares) | (2,176) | |||||||
Share grants, repurchases and forfeitures | 384 | 384 | 384 | |||||
Other comprehensive income (loss) | (8,778) | (7,018) | (7,018) | (1,760) | ||||
Distributions to common shareholders | (656) | (656) | (656) | |||||
Ending balance (in shares) at Mar. 31, 2023 | 65,565,969 | |||||||
Ending balance at Mar. 31, 2023 | $ 1,286,175 | 758,625 | $ 656 | 1,014,585 | 92,376 | 14,885 | (363,877) | 527,550 |
Beginning balance (in shares) at Dec. 31, 2022 | 65,568,145 | 65,568,145 | ||||||
Beginning balance at Dec. 31, 2022 | $ 1,330,771 | 790,724 | $ 656 | 1,014,201 | 117,185 | 21,903 | (363,221) | 540,047 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Distributions to common shareholders | $ (1,968) | |||||||
Ending balance (in shares) at Sep. 30, 2023 | 65,845,073 | 65,845,073 | ||||||
Ending balance at Sep. 30, 2023 | $ 1,218,138 | 713,515 | $ 658 | 1,015,468 | 40,436 | 22,142 | (365,189) | 504,623 |
Beginning balance (in shares) at Mar. 31, 2023 | 65,565,969 | |||||||
Beginning balance at Mar. 31, 2023 | 1,286,175 | 758,625 | $ 656 | 1,014,585 | 92,376 | 14,885 | (363,877) | 527,550 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net loss | (36,580) | (25,828) | (25,828) | (10,752) | ||||
Share grants, repurchases and forfeitures (in shares) | 131,990 | |||||||
Share grants, repurchases and forfeitures | 554 | 554 | $ 1 | 553 | ||||
Other comprehensive income (loss) | 12,021 | 11,602 | 11,602 | 419 | ||||
Distributions to noncontrolling interest | (225) | (225) | ||||||
Distributions to common shareholders | (656) | (656) | (656) | |||||
Ending balance (in shares) at Jun. 30, 2023 | 65,697,959 | |||||||
Ending balance at Jun. 30, 2023 | 1,261,289 | 744,297 | $ 657 | 1,015,138 | 66,548 | 26,487 | (364,533) | 516,992 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net loss | (36,191) | (26,112) | (26,112) | (10,079) | ||||
Share grants, repurchases and forfeitures (in shares) | 147,114 | |||||||
Share grants, repurchases and forfeitures | 331 | 331 | $ 1 | 330 | ||||
Other comprehensive income (loss) | (6,635) | (4,345) | (4,345) | (2,290) | ||||
Distributions to common shareholders | $ (656) | (656) | (656) | |||||
Ending balance (in shares) at Sep. 30, 2023 | 65,845,073 | 65,845,073 | ||||||
Ending balance at Sep. 30, 2023 | $ 1,218,138 | $ 713,515 | $ 658 | $ 1,015,468 | $ 40,436 | $ 22,142 | $ (365,189) | $ 504,623 |
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands |
9 Months Ended | |||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
|||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||
Net loss | $ (108,317) | $ (245,082) | ||
Adjustments to reconcile net loss to net cash provided by operating activities: | ||||
Depreciation | 93,545 | 75,014 | ||
Loss on impairment of real estate | 254 | 100,747 | ||
Net amortization of debt issuance costs, premiums and discounts | 20,177 | 90,265 | ||
Amortization of acquired real estate leases and assumed real estate lease obligations | 38,275 | 33,680 | ||
Amortization of deferred leasing costs | 1,723 | 1,170 | ||
Loss on equity securities | 0 | 5,758 | ||
Straight line rental income | (10,531) | (8,170) | ||
Loss on early extinguishment of debt | 359 | 22,198 | ||
Loss on sale of real estate | 974 | 10 | ||
Proceeds from settlement of derivatives | (40,426) | 0 | ||
Other non-cash expenses | 19,865 | 4,443 | ||
Distributions of earnings from unconsolidated joint venture | 2,970 | 3,962 | ||
Equity in earnings of unconsolidated joint venture | (7,423) | (6,634) | ||
Change in assets and liabilities: | ||||
Rents receivable | 3,260 | (16,299) | ||
Other assets | (11,459) | 3,615 | ||
Accounts payable and other liabilities | 9,745 | 14,921 | ||
Due to related persons | 1,072 | 2,309 | ||
Net cash provided by operating activities | 14,063 | 81,907 | ||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||
Real estate acquisitions | 0 | (3,589,085) | ||
Real estate improvements | (13,649) | (8,741) | ||
Proceeds from sale of marketable securities | 0 | 140,792 | ||
Proceeds from sale of real estate | 243 | 0 | ||
Proceeds from settlement of derivatives | 40,426 | 0 | ||
Distributions in excess of earnings from unconsolidated joint venture | 4,400 | 0 | ||
Net cash provided by (used in) investing activities | 31,420 | (3,457,034) | ||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||
Proceeds from issuance of mortgage notes payable | 91,000 | 3,335,000 | ||
Repayment of mortgage notes payable | (50,993) | (12,591) | ||
Proceeds from secured bridge loan facility | 0 | 1,385,158 | ||
Repayment of secured bridge loan facility | 0 | (1,385,158) | ||
Borrowings under revolving credit facility | 0 | 3,000 | ||
Repayments of revolving credit facility | 0 | (185,000) | ||
Payment of debt issuance costs | (1,414) | (211,996) | ||
Distributions to common shareholders | (1,968) | (43,821) | ||
Proceeds from sale of noncontrolling interest, net | 0 | 589,411 | ||
Repurchase of common shares | (160) | (239) | ||
Distributions to noncontrolling interest | (225) | (1,365) | ||
Net cash provided by financing activities | 36,240 | 3,472,399 | ||
Increase in cash, cash equivalents and restricted cash | 81,723 | 97,272 | ||
Cash, cash equivalents and restricted cash at beginning of period | 140,780 | 29,397 | ||
Cash, cash equivalents and restricted cash at end of period | 222,503 | 126,669 | ||
SUPPLEMENTAL DISCLOSURES: | ||||
Interest paid | 218,369 | 113,748 | ||
Income taxes paid | 85 | 223 | ||
Interest capitalized | 545 | 68 | ||
NON-CASH INVESTING ACTIVITIES: | ||||
Real estate acquired by assumption of mortgage notes payable | 0 | 323,432 | ||
Real estate improvements accrued not paid | 2,810 | 7,165 | ||
NON-CASH FINANCING ACTIVITIES: | ||||
Assumption of mortgage notes payable | 0 | (323,432) | ||
SUPPLEMENTAL DISCLOSURE OF CASH, CASH EQUIVALENTS AND RESTRICTED CASH: | ||||
Cash and cash equivalents | 83,283 | 26,381 | ||
Restricted cash | [1] | 139,220 | 100,288 | |
Total cash, cash equivalents and restricted cash shown in the statements of cash flows | $ 222,503 | $ 126,669 | ||
|
Basis of Presentation |
9 Months Ended |
---|---|
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of PresentationThe accompanying condensed consolidated financial statements of Industrial Logistics Properties Trust and its consolidated subsidiaries, or the Company, ILPT, we, us or our, are unaudited. Certain information and disclosures required by U.S. generally accepted accounting principles, or GAAP, for complete financial statements have been condensed or omitted. We believe the disclosures made are adequate to make the information presented not misleading. However, the accompanying condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes contained in our Annual Report on Form 10-K for the year ended December 31, 2022, or our 2022 Annual Report. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair statement of results for the interim period have been included. All intercompany transactions and balances with or among our consolidated subsidiaries have been eliminated. Our operating results for interim periods are not necessarily indicative of the results that may be expected for the full year.The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect reported amounts. Actual results could differ from those estimates. Significant estimates in the condensed consolidated financial statements include purchase price allocations, useful lives of fixed assets, and assessment of impairment of real estate and related intangibles. |
Real Estate Investments |
9 Months Ended |
---|---|
Sep. 30, 2023 | |
Real Estate [Abstract] | |
Real Estate Investments | Real Estate Investments As of September 30, 2023, our portfolio was comprised of 413 consolidated properties containing approximately 59,983,000 rentable square feet, including 226 buildings, leasable land parcels and easements containing approximately 16,729,000 rentable square feet of primarily industrial lands located on the island of Oahu, Hawaii, or our Hawaii Properties, and 187 industrial properties containing approximately 43,254,000 rentable square feet located in 38 other states, or our Mainland Properties, which included 94 properties in 27 states totaling approximately 20,981,000 rentable square feet, owned by a consolidated joint venture in which we own a 61% equity interest. As of September 30, 2023, we also owned a 22% equity interest in an unconsolidated joint venture which owns 18 industrial properties located in 12 states totaling approximately 11,726,000 rentable square feet. We operate in one business segment: ownership and leasing of properties that include industrial and logistics buildings and leased industrial lands. We incurred capital expenditures and leasing costs at certain of our properties of $5,275 and $8,574 during the three months ended September 30, 2023 and 2022, respectively, and $17,857 and $22,419 for the nine months ended September 30, 2023 and 2022, respectively. During the nine months ended September 30, 2023, we committed $7,273 for expenditures related to tenant improvements and leasing costs for leases executed during the period for approximately 3,868,000 rentable square feet. Committed, but unspent, tenant related obligations based on existing leases as of September 30, 2023 were $5,923, of which $3,529 is expected to be spent during the next 12 months. Impairment We regularly evaluate whether events or changes in circumstances have occurred that could indicate an impairment in the value of long lived assets. Impairment indicators may include declining tenant occupancy, lack of progress leasing vacant space, tenant bankruptcies, low long term prospects for improvement in property performance, weak or declining tenant profitability, cash flow or liquidity, our decision to dispose of an asset before the end of its estimated useful life and legislative, market or industry changes that could permanently reduce the value of a property. If there is an indication that the carrying value of an asset is not recoverable, we estimate the projected undiscounted cash flows to determine if an impairment loss should be recognized. The future net undiscounted cash flows are subjective and are based in part on assumptions regarding hold periods, market rents and terminal capitalization rates. If the carrying value exceeds the projected undiscounted cash flows, we determine the amount of any impairment loss by comparing the historical carrying value to estimated fair value. We estimate fair value through an evaluation of recent financial performance and projected discounted cash flows using standard industry valuation techniques. In addition to consideration of impairment upon the events or changes in circumstances described above, we regularly evaluate the remaining useful lives of our long lived assets. If we change our estimate of the remaining useful lives, we allocate the carrying value of the affected assets over their revised remaining useful lives. During the nine months ended September 30, 2023, we recognized a loss on impairment of real estate of $254 to reduce the carrying value of a property that was classified as held for sale at September 30, 2023 to its estimated sales price less costs to sell. During the nine months ended September 30, 2022, we recognized a $100,747 loss on impairment for 25 properties we acquired as part of our acquisition of Monmouth Real Estate Investment Corporation, or MNR, on February 25, 2022, to adjust the carrying value of these properties to their estimated fair value. Disposition Activities In March 2023, we received gross proceeds of $270 and recognized a $974 net loss on sale of real estate as a result of a property in Everett, Washington partially taken by eminent domain. As of September 30, 2023, we had three Mainland Properties with an aggregate carrying value of $56,944, classified as held for sale in our condensed consolidated balance sheet. As of October 25, 2023, one of these properties is under agreement to sell for a sales price of $21,500, excluding closing costs. This pending sale is subject to conditions; accordingly, we cannot be sure that we will complete this sale, that this sale will not be delayed or that the terms will not change. We terminated agreements to sell two of these properties for an aggregate sales price of $43,765 and we continue to market one of these two properties for sale. Consolidated Joint Venture We own a 61% equity interest in Mountain Industrial REIT LLC, or Mountain JV, or our consolidated joint venture, which owns 94 properties in 27 states totaling approximately 20,981,000 rentable square feet. We control our consolidated joint venture and therefore account for the properties owned by this joint venture on a consolidated basis in our condensed consolidated financial statements. We recognized a 39% noncontrolling interest in our condensed consolidated financial statements for the three months ended September 30, 2023 and 2022, for the nine months ended September 30, 2023 and the period from this joint venture’s formation date, February 25, 2022 to September 30, 2022. The portion of this joint venture's net loss not attributable to us, or $10,238 and $38,318, for the three months ended September 30, 2023 and 2022, respectively, and $31,642 and $49,360 for the nine months ended September 30, 2023 and for the period from February 25, 2022 to September 30, 2022, respectively, is reported as net loss attributable to noncontrolling interest in our condensed consolidated statements of comprehensive income (loss). As of September 30, 2023, our consolidated joint venture had total assets of $3,065,834 and total liabilities of $1,781,222. Consolidated Tenancy in Common An unrelated third party owns an approximate 33% tenancy in common interest in one property located in Somerset, New Jersey with approximately 64,000 rentable square feet, and we own the remaining 67% tenancy in common interest in this property. The portion of this property’s net income (loss) not attributable to us, or $159 and ($29), for the three months ended September 30, 2023 and 2022, respectively, and $74 and ($42) for the nine months ended September 30, 2023 and the period from the date we acquired our interest in this property, February 25, 2022 to September 30, 2022, respectively, is reported as net loss attributable to noncontrolling interest in our condensed consolidated statements of comprehensive income (loss). During the nine months ended September 30, 2023, this tenancy in common made cash distributions of $225 to the unrelated third party investor, which is reflected as a decrease in noncontrolling interest in our condensed consolidated balance sheet. Unconsolidated Joint Venture We own a 22% equity interest in The Industrial Fund REIT LLC, or the unconsolidated joint venture, which owns 18 industrial properties located in 12 states totaling approximately 11,726,000 rentable square feet. We account for the unconsolidated joint venture under the equity method of accounting under the fair value option. We recognize changes in the fair value of our investment in the unconsolidated joint venture as equity in earnings of the unconsolidated joint venture in our condensed consolidated statements of comprehensive income (loss).
|
Leases |
9 Months Ended |
---|---|
Sep. 30, 2023 | |
Leases [Abstract] | |
Leases | Leases We are a lessor of industrial and logistics properties. Our leases provide our tenants with the contractual right to use and economically benefit from all the physical space specified in their respective leases; therefore, we have determined to evaluate our leases as lease arrangements. We recognize rental income from operating leases on a straight line basis over the lease term when we have determined that the collectability of substantially all of the lease payments is probable. We increased rental income by $3,414 and $3,794 to record revenue on a straight line basis during the three months ended September 30, 2023 and 2022, respectively, and $10,531 and $8,170 for the nine months ended September 30, 2023 and 2022, respectively. We do not include in our measurement of our lease receivables certain variable payments, including payments determined by changes in the index or market-based indices after the inception of the lease, certain tenant reimbursements and other income until the specific events that trigger the variable payments have occurred. Such payments totaled $19,310 and $16,664 for the three months ended September 30, 2023 and 2022, respectively, and $58,700 and $46,071 for the nine months ended September 30, 2023 and 2022, respectively. Generally, payments of ground lease obligations are made by our tenants. However, if a tenant does not perform obligations under a ground lease or does not renew any ground lease, we may have to perform obligations under, or renew, the ground lease in order to protect our investment in the affected property. We define annualized rental revenues as the annualized contractual base rents from our tenants pursuant to our lease agreements as of the measurement date, including straight line rent adjustments and estimated recurring expense reimbursements to be paid to us, and excluding lease value amortization. Right of Use Assets and Lease Liabilities We are the lessee for three of our properties subject to ground leases and one office property that we assumed as part of our acquisition of MNR. For leases with a term greater than 12 months under which we are the lessee, we are required to record a right of use asset and lease liability. The values of our right of use assets and related lease liabilities were $4,757 and $4,837, respectively, as of September 30, 2023, and $5,084 and $5,149, respectively, as of December 31, 2022. Our right of use assets and related lease liabilities are included in other assets, net and accounts payable and other liabilities, respectively, in our condensed consolidated balance sheets. We sublease a portion of our office property assumed in the acquisition of MNR. Rent expense incurred under this lease, net of sublease revenue, was $12 and $176 for three months ended September 30, 2023 and 2022, respectively, and $141 and $355 for the nine months ended September 30, 2023 and the period from February 25, 2022 to September 30, 2022, respectively. Rent expense is included in general and administrative expense in our condensed consolidated statements of comprehensive income (loss). Tenant Concentration Subsidiaries of FedEx Corporation and Amazon.com Services, Inc. were responsible for approximately 29.8% and 6.7% of our annualized rental revenues as of September 30, 2023, respectively, and 29.6% and 6.8% as of September 30, 2022, respectively. Geographic Concentration For the three months ended September 30, 2023 and 2022, approximately 28.1% and 26.8%, respectively, of our rental income was from our Hawaii Properties. For the nine months ended September 30, 2023 and 2022, approximately 27.9% and 30.6%, respectively, of our rental income was from our Hawaii Properties.
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Indebtedness |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Indebtedness | Indebtedness As of September 30, 2023 and December 31, 2022, our outstanding indebtedness consisted of the following:
(1)Interest rates are as of September 30, 2023 and reflect the impact of interest rate caps, if any, and exclude the impact of the amortization of debt issuance costs, premiums and discounts. Our $1,235,000 loan, or the ILPT Floating Rate Loan, matures in October 2024, subject to three, one year extension options, and requires that interest be paid at an annual rate of secured overnight financing rate, or SOFR, plus a weighted average premium of 3.93%. The weighted average interest rate payable under the ILPT Floating Rate Loan was 6.18%, including the impact of our interest rate cap on SOFR of 2.25%, for both the three and nine months ended September 30, 2023. Beginning in October 2023, subject to the satisfaction of certain conditions, we have the option to prepay the ILPT Floating Rate Loan in full or in part at any time at par with no premium. Our $1,400,000 loan, or the Floating Rate Loan, matures in March 2024, subject to three, one year extension options, and requires that interest be paid at an annual rate of SOFR plus a premium of 2.77%. The weighted average annual interest rate payable under the Floating Rate Loan was 6.17%, including the impact of our interest rate cap on SOFR of 3.40%, for both the three and nine months ended September 30, 2023. The weighted average annual interest rate payable under the Floating Rate Loan was 4.94% and 4.23% for the three months ended September 30, 2022 and the period from February 25, 2022 to September 30, 2022, respectively. Subject to the satisfaction of certain conditions, we have the option to prepay up to $280,000 of the Floating Rate Loan at par with no premium, and to prepay the balance of the Floating Rate Loan at any time, subject to a premium. See Note 9 for more information regarding our interest rate caps. In May 2023, our consolidated joint venture obtained a $91,000 fixed rate, interest only mortgage loan secured by four properties owned by our consolidated joint venture. This mortgage loan matures in June 2030 and requires that interest be paid at an annual rate of 6.25%. A portion of the net proceeds from this mortgage loan was used to repay four outstanding mortgage loans of our consolidated joint venture with an aggregate outstanding principal balance of $35,910 and a weighted average interest rate of 3.70%. We recognized a loss on early extinguishment of debt of $359 for the nine months ended September 30, 2023 in conjunction with the repayment of these mortgage loans. The agreements governing certain of our indebtedness contain customary covenants and provide for acceleration of payment of all amounts due thereunder upon the occurrence and continuation of certain events of default.
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Fair Value of Assets and Liabilities |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value of Assets and Liabilities | Fair Value of Assets and Liabilities Our financial instruments include cash and cash equivalents, restricted cash, mortgages and notes payables, accounts payable and interest rate caps. At September 30, 2023 and December 31, 2022, the fair value of our financial instruments approximated their carrying values in our condensed consolidated financial statements, due to their short term nature or floating interest rates, except as follows:
(1)Includes unamortized debt issuance costs, premiums and discounts of $8,751 and $8,628 at September 30, 2023 and December 31, 2022, respectively. (2)This loan was repaid in May 2023. We estimate the fair value of our mortgage notes payable using significant unobservable inputs (Level 3), such as discounted cash flow analyses and prevailing market rates as of the measurement date. The table below presents certain of our assets measured on a recurring and non-recurring basis at fair value at September 30, 2023 and December 31, 2022, categorized by the level of inputs as defined in the fair value hierarchy under GAAP, used in the valuation of each asset:
(1)The estimated fair values of our interest rate cap derivatives are based on then current market prices in secondary markets for similar derivative contracts. (2)At September 30, 2023 and December 31, 2022, we reduced the carrying value of one property and 25 properties, respectively, to their estimated fair value based on third party offers. See Note 2 for more information. At September 30, 2023 and December 31, 2022, the fair value of our investment in the unconsolidated joint venture was determined by discounting expected future cash flows based on prevailing market rents over a holding period and including an exit capitalization rate to determine the final year of cash flows. The discount rates, exit capitalization rates and holding periods used are Level 3 significant unobservable inputs and are shown in the table below:
The table below presents a summary of the changes in fair value for our investment in the unconsolidated joint venture:
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Shareholders' Equity |
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Shareholders' Equity | Shareholders’ Equity Common Share Awards On June 1, 2023, in accordance with our Trustee compensation arrangements, we awarded to each of our seven Trustees 20,000 of our common shares, valued at $1.78 per share, the closing price of our common shares on The Nasdaq Stock Market LLC, or Nasdaq, on that day. On September 13, 2023, we awarded under our equity compensation plan an aggregate of 188,350 of our common shares, valued at $3.63 per share, the closing price of our common shares on Nasdaq on that day, to our officers and certain other employees of The RMR Group LLC, or RMR. Common Share Purchases During the three and nine months ended September 30, 2023, we purchased an aggregate of 40,636 and 48,722 of our common shares, respectively, valued at a weighted average price of $3.54 and $3.29 per common share, respectively, from our officers and certain other current and former employees of RMR in satisfaction of tax withholding and payment obligations in connection with the vesting of awards of our common shares. Distributions During the nine months ended September 30, 2023, we declared and paid regular quarterly distributions to common shareholders as follows:
On October 12, 2023, we declared a regular quarterly distribution to common shareholders of record on October 23, 2023 of $0.01 per share, or approximately $658. We expect to pay this distribution to our shareholders on or about November 16, 2023 using cash balances.
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Business and Property Management Agreements with RMR |
9 Months Ended |
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Sep. 30, 2023 | |
Related Party Transactions [Abstract] | |
Business and Property Management Agreements with RMR | Business and Property Management Agreements with RMR We have no employees. The personnel and various services we require to operate our business are provided to us by RMR. We have two agreements with RMR to provide management services to us: (1) a business management agreement, which relates to our business generally; and (2) a property management agreement, which relates to our property level operations. Pursuant to our business management agreement with RMR, we recognized net business management fees of $5,919 and $17,301 for the three and nine months ended September 30, 2023, respectively, and $6,465 and $17,821 for the three and nine months ended September 30, 2022, respectively. Based on our common share total return, as defined in our business management agreement, as of September 30, 2023 and 2022, no incentive fees are included in the net business management fees we recognized for the three and nine months ended September 30, 2023 or 2022. The actual amount of annual incentive fees for 2023, if any, will be based on our common share total return, as defined in our business management agreement, for the three-year period ending December 31, 2023, and will be payable in January 2024. We did not incur any incentive fee payable to RMR for the year ended December 31, 2022. We include business management fees in general and administrative expenses in our condensed consolidated statements of comprehensive income (loss). Pursuant to our property management agreement with RMR, we recognized aggregate property management and construction supervision fees of $3,464 and $10,286 for the three and nine months ended September 30, 2023, respectively, and $3,270 and $8,797 for the three and nine months ended September 30, 2022, respectively. Of these amounts, for the three and nine months ended September 30, 2023, $3,293 and $9,745, respectively, were included in other operating expenses in our condensed consolidated statements of comprehensive income (loss) and $171 and $541, respectively, were capitalized as building improvements in our condensed consolidated balance sheets. For the three and nine months ended September 30, 2022, $2,976 and $8,104, respectively, were included in other operating expenses in our condensed consolidated statements of comprehensive income (loss) and $294 and $693, respectively, were capitalized as buildings and improvements in our condensed consolidated balance sheets. The amounts capitalized are being depreciated over the estimated useful lives of the related capital assets. We are generally responsible for all our operating expenses, including certain expenses incurred or arranged by RMR on our behalf. We are generally not responsible for payment of RMR’s employment, office or administrative expenses incurred to provide management services to us, except for the employment and related expenses of RMR’s employees assigned to work exclusively or partly at our properties, our share of the wages, benefits and other related costs of RMR’s centralized accounting personnel, our share of RMR’s costs for providing our internal audit function, or as otherwise agreed. Our property level operating expenses are generally incorporated into the rents charged to our tenants, including certain payroll and related costs incurred by RMR. We reimbursed RMR $2,375 and $6,216 for these expenses and costs for the three and nine months ended September 30, 2023, respectively, and $1,847 and $5,155 for the three and nine months ended September 30, 2022, respectively. These amounts are included in other operating expenses and general and administrative expenses, as applicable, in our condensed consolidated statements of comprehensive income (loss). Management Agreements Between Our Joint Ventures and RMR. We have two separate joint venture arrangements, our consolidated joint venture and the unconsolidated joint venture. RMR provides management services to both of these joint ventures. We are not obligated to pay management fees to RMR under our management agreements with RMR for the services it provides to the unconsolidated joint venture. We are obligated to pay management fees to RMR under our management agreements with RMR for the services it provides to our consolidated joint venture; however, that joint venture pays management fees directly to RMR, and any such fees paid by our consolidated joint venture are credited against the fees payable by us to RMR. See Note 2 for further information about our joint ventures. See Note 8 for further information regarding our relationships, agreements and transactions with RMR.
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Related Person Transactions |
9 Months Ended |
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Sep. 30, 2023 | |
Related Party Transactions [Abstract] | |
Related Person Transactions | Related Person Transactions We have relationships and historical and continuing transactions with RMR, The RMR Group Inc., or RMR Inc., and others related to them, including other companies to which RMR or its subsidiaries provide management services and some of which have trustees, directors or officers who are also our Trustees or officers. RMR is a majority owned subsidiary of RMR Inc. The Chair of our Board of Trustees and one of our Managing Trustees, Adam D. Portnoy, is the sole trustee, an officer and the controlling shareholder of ABP Trust, which is the controlling shareholder of RMR Inc., the chair of the board of directors, a managing director and the president and chief executive officer of RMR Inc. and an officer and employee of RMR. Matthew P. Jordan, our other Managing Trustee, is an executive vice president and the chief financial officer and treasurer of RMR Inc., an officer and employee of RMR and an officer of ABP Trust. John G. Murray, one of our Managing Trustees until June 1, 2022 and our President and Chief Executive Officer until March 31, 2022, also serves as an officer and employee of RMR, and each of our current officers is also an officer and employee of RMR. Some of our Independent Trustees also serve as independent trustees of other public companies to which RMR or its subsidiaries provide management services. Adam D. Portnoy serves as chair of the boards and as a managing trustee of those companies. Other officers of RMR, including Messrs. Jordan and Murray and certain of our officers, serve as managing trustees or officers of certain of these companies. See Note 6 for information relating to the awards of our common shares we made in September 2023 to our officers and certain other employees of RMR and common shares we purchased from our officers and certain other current and former officers and employees of RMR in satisfaction of tax withholding and payment obligations in connection with the vesting of awards of our common shares. We include amounts recognized as expense for awards of our common shares to our officers and RMR employees in general and administrative expenses in our condensed consolidated statements of comprehensive income (loss). Our Manager, RMR. We have two agreements with RMR to provide management services to us. See Note 7 for further information regarding our management agreements with RMR. Joint Ventures. We have two separate joint venture arrangements. RMR provides management services to each of these joint ventures. As of September 30, 2023 and December 31, 2022, we owed $613 and $616, respectively, to the unconsolidated joint venture for rents that we collected on behalf of that joint venture. These amounts are presented as due to related persons in our condensed consolidated balance sheets. We paid these amounts in October 2023 and January 2023, respectively. See Notes 2 and 7 for further information regarding our joint ventures and RMR’s management agreements with our joint ventures. For further information about these and other such relationships and certain other related person transactions, see our 2022 Annual Report.
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Derivatives and Hedging Activities |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivatives and Hedging Activities | Derivatives and Hedging Activities Risk Management Objective of Using Derivatives We are exposed to certain risks relating to our ongoing business operations, including the impact of changes in interest rates. The only risk currently managed by us using derivative instruments is our interest rate risk. We have an interest rate cap agreement to manage our interest rate risk exposure on each of the ILPT Floating Rate Loan and the Floating Rate Loan, both with interest payable at a rate equal to SOFR plus a premium. The use of derivative financial instruments carries certain risks, including the risk that the counterparties to these contractual arrangements are not able to perform under the agreements. To mitigate this risk, we only enter into derivative financial instruments with counterparties with high credit ratings and with major financial institutions with which we or our related parties may also have other financial relationships. We do not anticipate that any of the counterparties will fail to meet their obligations. Cash Flow Hedges of Interest Rate Risk We record all derivatives in our condensed consolidated balance sheets at fair value. The following table summarizes the terms of our outstanding interest rate cap agreements designated as cash flow hedges of interest rate risk at September 30, 2023 and December 31, 2022:
Interest rate caps designated as cash flow hedges involve the receipt of variable amounts from a counterparty if interest rates rise above the strike rate on the contract in exchange for an up-front premium. For derivatives designated and qualifying as cash flow hedges of interest rate risk, the gain or loss on the derivative is recorded in cumulative other comprehensive income and subsequently reclassified into interest expense in the same period during which the hedged transaction affects earnings. Gains and losses on the derivative representing hedge components excluded from the assessment of effectiveness are recognized over the life of the hedge on a systematic and rational basis, as documented at hedge inception in accordance with our accounting policy election. The earnings recognition of excluded components is presented in interest expense. Amounts reported in cumulative other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are made on our applicable debt. In September 2022, in conjunction with the repayment of the then existing $1,385,158 bridge loan facility secured by 109 of our properties, we sold two interest rate cap instruments with an aggregate notional amount of $1,385,158, a strike rate equal to 2.70% and an original expiration date of March 15, 2023 for $7,740. As the underlying debt instrument that these interest rate caps were intended to hedge was repaid in its entirety and the related interest expense was no longer probable to occur, these interest rate caps were no longer designated as cash flow hedges and the remaining deferred gain was reclassified from cumulative other comprehensive income as a reduction of loss on early extinguishment of debt. The following table summarizes the activity related to our cash flow hedges within cumulative other comprehensive income for the periods shown:
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Basis of Presentation (Policies) |
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Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Basis of Presentation | The accompanying condensed consolidated financial statements of Industrial Logistics Properties Trust and its consolidated subsidiaries, or the Company, ILPT, we, us or our, are unaudited. Certain information and disclosures required by U.S. generally accepted accounting principles, or GAAP, for complete financial statements have been condensed or omitted. We believe the disclosures made are adequate to make the information presented not misleading. However, the accompanying condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes contained in our Annual Report on Form 10-K for the year ended December 31, 2022, or our 2022 Annual Report. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair statement of results for the interim period have been included. All intercompany transactions and balances with or among our consolidated subsidiaries have been eliminated. Our operating results for interim periods are not necessarily indicative of the results that may be expected for the full year. |
Use of Estimates | The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect reported amounts. Actual results could differ from those estimates. Significant estimates in the condensed consolidated financial statements include purchase price allocations, useful lives of fixed assets, and assessment of impairment of real estate and related intangibles. |
Indebtedness (Tables) |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Outstanding Indebtedness | As of September 30, 2023 and December 31, 2022, our outstanding indebtedness consisted of the following:
(1)Interest rates are as of September 30, 2023 and reflect the impact of interest rate caps, if any, and exclude the impact of the amortization of debt issuance costs, premiums and discounts.
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Fair Value of Assets and Liabilities (Tables) |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Carrying Value and the Estimated Fair Market Value of Mortgage Notes Payable | At September 30, 2023 and December 31, 2022, the fair value of our financial instruments approximated their carrying values in our condensed consolidated financial statements, due to their short term nature or floating interest rates, except as follows:
(1)Includes unamortized debt issuance costs, premiums and discounts of $8,751 and $8,628 at September 30, 2023 and December 31, 2022, respectively. (2)This loan was repaid in May 2023.
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Schedule of Fair Value Measurements, Recurring and Nonrecurring | The table below presents certain of our assets measured on a recurring and non-recurring basis at fair value at September 30, 2023 and December 31, 2022, categorized by the level of inputs as defined in the fair value hierarchy under GAAP, used in the valuation of each asset:
(1)The estimated fair values of our interest rate cap derivatives are based on then current market prices in secondary markets for similar derivative contracts. (2)At September 30, 2023 and December 31, 2022, we reduced the carrying value of one property and 25 properties, respectively, to their estimated fair value based on third party offers. See Note 2 for more information.
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Schedule of Quantitative Information of Significant Unobservable Inputs Related to Certain Level 3 Fair Value Measurements | The discount rates, exit capitalization rates and holding periods used are Level 3 significant unobservable inputs and are shown in the table below:
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Schedule of the Change in Fair Value of the Investment in the Unconsolidated Joint Venture | The table below presents a summary of the changes in fair value for our investment in the unconsolidated joint venture:
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Shareholders' Equity (Tables) |
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Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Distributions Declared and Paid | During the nine months ended September 30, 2023, we declared and paid regular quarterly distributions to common shareholders as follows:
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Derivatives and Hedging Activities (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Interest Rate Swap Derivatives | The following table summarizes the terms of our outstanding interest rate cap agreements designated as cash flow hedges of interest rate risk at September 30, 2023 and December 31, 2022:
|
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Schedule of Effects on Consolidated Statements of Income and Comprehensive Income | The following table summarizes the activity related to our cash flow hedges within cumulative other comprehensive income for the periods shown:
|
Real Estate Investments (Details) ft² in Thousands, $ in Thousands |
1 Months Ended | 3 Months Ended | 7 Months Ended | 9 Months Ended | ||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
Oct. 25, 2023
USD ($)
property
|
Mar. 31, 2023
USD ($)
|
Sep. 30, 2023
USD ($)
|
Sep. 30, 2022
USD ($)
|
Sep. 30, 2022
USD ($)
|
Sep. 30, 2023
USD ($)
segment
property
|
Sep. 30, 2022
USD ($)
property
|
Sep. 30, 2023
property
|
Sep. 30, 2023
ft²
|
Sep. 30, 2023
building
|
Sep. 30, 2023
state
|
Sep. 30, 2023 |
|
Real Estate Properties [Line Items] | ||||||||||||
Number of properties owned | property | 413 | |||||||||||
Rentable square feet (in sqft) | ft² | 59,983 | |||||||||||
Number of business segments | segment | 1 | |||||||||||
Capital expenditures incurred | $ 5,275 | $ 8,574 | $ 17,857 | $ 22,419 | ||||||||
Commitments related to tenant improvements and leasing costs | 7,273 | |||||||||||
Tenant improvements (in sqft) | ft² | 3,868 | |||||||||||
Committed but unspent tenant related obligations | 5,923 | 5,923 | ||||||||||
Committed but unspent tenant related obligations expected to be spent in the next 12 months | 3,529 | 3,529 | ||||||||||
Loss on impairment of real estate | 0 | 0 | 254 | 100,747 | ||||||||
Net income (loss) attributable to noncontrolling interest | (10,079) | (38,347) | (31,568) | (49,402) | ||||||||
Cash distributions | 225 | 1,365 | ||||||||||
Mountain Industrial REIT LLC | ||||||||||||
Real Estate Properties [Line Items] | ||||||||||||
Noncontrolling interest, ownership percentage by noncontrolling owners | 39.00% | |||||||||||
Subsequent Event | Mainland Properties | ||||||||||||
Real Estate Properties [Line Items] | ||||||||||||
Number of properties | property | 2 | |||||||||||
Number of real estate properties under agreement to sell | property | 1 | |||||||||||
Real estate properties under agreement to sell, sales price | $ 21,500 | |||||||||||
Number of real estate properties, agreement terminated | property | 2 | |||||||||||
Terminated agreement sales price | $ 43,765 | |||||||||||
Disposal Group, Held-for-sale, Not Discontinued Operations | Mainland Properties | ||||||||||||
Real Estate Properties [Line Items] | ||||||||||||
Number of properties | property | 3 | |||||||||||
Aggregate sales price excluding closing costs | 56,944 | 56,944 | ||||||||||
Disposal Group, Held-for-sale, Not Discontinued Operations | Subsequent Event | Mainland Properties | ||||||||||||
Real Estate Properties [Line Items] | ||||||||||||
Number of properties | property | 1 | |||||||||||
Mountain Industrial REIT LLC | ||||||||||||
Real Estate Properties [Line Items] | ||||||||||||
Net income (loss) attributable to noncontrolling interest | (10,238) | (38,318) | $ (49,360) | (31,642) | ||||||||
Mountain Industrial REIT LLC | Other Joint Venture Investor | ||||||||||||
Real Estate Properties [Line Items] | ||||||||||||
Joint venture, total assets | 3,065,834 | 3,065,834 | ||||||||||
Joint venture, liabilities | 1,781,222 | 1,781,222 | ||||||||||
Twelve Mainland Properties | ||||||||||||
Real Estate Properties [Line Items] | ||||||||||||
Rentable square feet (in sqft) | ft² | 11,726 | |||||||||||
Number of states where real estate is located | state | 12 | |||||||||||
Ownership interest (as percent) | 22.00% | |||||||||||
Number of properties contributed | property | 18 | |||||||||||
Monmouth Real Estate Investment Corporation | ||||||||||||
Real Estate Properties [Line Items] | ||||||||||||
Loss on impairment of real estate | $ 100,747 | |||||||||||
Number of properties | property | 25 | |||||||||||
Tenancy in Common | Unrelated Third Party | ||||||||||||
Real Estate Properties [Line Items] | ||||||||||||
Cash distributions | $ 225 | |||||||||||
Consolidated | Mountain Industrial REIT LLC | ||||||||||||
Real Estate Properties [Line Items] | ||||||||||||
Number of properties owned | property | 94 | |||||||||||
Rentable square feet (in sqft) | ft² | 20,981 | |||||||||||
Number of states where real estate is located | 27,000 | 27 | ||||||||||
Ownership interest (as percent) | 61.00% | |||||||||||
Joint Venture | The Industrial Fund REIT LLC | ||||||||||||
Real Estate Properties [Line Items] | ||||||||||||
Ownership interest (as percent) | 22.00% | |||||||||||
Hawaii | ||||||||||||
Real Estate Properties [Line Items] | ||||||||||||
Rentable square feet (in sqft) | ft² | 16,729 | |||||||||||
Number of buildings, leasable land parcels easements | building | 226 | |||||||||||
Other States | ||||||||||||
Real Estate Properties [Line Items] | ||||||||||||
Number of properties owned | property | 187 | |||||||||||
Rentable square feet (in sqft) | ft² | 43,254 | |||||||||||
Number of states where real estate is located | state | 38 | |||||||||||
Everett, WA | Land | Disposal Group, Disposed of by Sale, Not Discontinued Operations | ||||||||||||
Real Estate Properties [Line Items] | ||||||||||||
Proceeds from sale of real estate | $ 270 | |||||||||||
Losses on sale of real estate | $ 974 | |||||||||||
Somerset, New Jersey | Tenancy in Common | Unrelated Third Party | ||||||||||||
Real Estate Properties [Line Items] | ||||||||||||
Rentable square feet (in sqft) | ft² | 64 | |||||||||||
Ownership interest (as percent) | 67.00% | |||||||||||
Number of properties | property | 1 | |||||||||||
Net income (loss) attributable to noncontrolling interest | $ 159 | $ (29) | $ (42) | $ 74 | ||||||||
Somerset, New Jersey | Tenancy in Common | Unrelated Third Party | ||||||||||||
Real Estate Properties [Line Items] | ||||||||||||
Noncontrolling interest, ownership percentage by noncontrolling owners | 33.00% |
Leases (Details) $ in Thousands |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2023
USD ($)
property
|
Sep. 30, 2022
USD ($)
|
Sep. 30, 2023
USD ($)
property
|
Sep. 30, 2022
USD ($)
|
Dec. 31, 2022
USD ($)
|
|
Lessor, Lease, Description [Line Items] | |||||
Straight line rental income | $ 3,414 | $ 3,794 | $ 10,531 | $ 8,170 | |
Certain variable payments | $ 19,310 | 16,664 | $ 58,700 | 46,071 | |
Number of properties subject to ground leases | property | 3 | 3 | |||
Lessee, number of properties under an operating lease | property | 1 | ||||
Right-of-use asset | $ 4,757 | $ 4,757 | $ 5,084 | ||
Operating lease liability | 4,837 | 4,837 | $ 5,149 | ||
Sublease revenue | $ 12 | $ 176 | $ 141 | $ 355 | |
Sales Revenue, Net | Geographic Concentration Risk | Hawaii | |||||
Lessor, Lease, Description [Line Items] | |||||
Concentration risk | 28.10% | 26.80% | 27.90% | 30.60% | |
FedEx Corporation | |||||
Lessor, Lease, Description [Line Items] | |||||
Percentage of rentable square feet | 6.70% | 6.80% | 6.70% | 6.80% | |
Amazon.com, Inc | |||||
Lessor, Lease, Description [Line Items] | |||||
Percentage of rentable square feet | 29.80% | 29.60% | 29.80% | 29.60% |
Indebtedness - Schedule of Outstanding Indebtedness (Details) $ in Thousands |
9 Months Ended | ||
---|---|---|---|
Sep. 30, 2023
USD ($)
property
|
Dec. 31, 2022
USD ($)
|
Sep. 30, 2022
USD ($)
|
|
Debt Instrument [Line Items] | |||
Total principal balance | $ 4,330,370 | $ 4,290,363 | |
Unamortized debt issuance costs | (26,739) | $ (45,862) | |
Total indebtedness, net | $ 4,303,631 | $ 4,244,501 | |
Interest rate (as a percent) | 5.47% | ||
Net book value of collateral | $ 4,763,350 | 4,857,352 | |
Fixed rate loan, 3.67% interest rate, due in 2031 | |||
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 3.67% | ||
Fixed rate loan, 4.02% interest rate, due in 2033 | |||
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 4.02% | ||
Fixed rate loan, 4.13% interest rate, due in 2033 | |||
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 4.13% | ||
Fixed rate loan, 3.10% interest rate, due in 2035 | |||
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 3.10% | ||
Fixed rate loan, 2.95% interest rate, due in 2036 | |||
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 2.95% | ||
Fixed rate loan, 4.27% interest rate, due in 2037 | |||
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 4.27% | ||
Fixed rate loan, 3.25% interest rate, due in 2038 | |||
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 3.25% | ||
Fixed rate loan, 3.76% interest rate, due in 2028 | |||
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 3.76% | ||
Fixed rate loan, 3.77% interest rate, due in 2030 | |||
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 3.77% | ||
Fixed rate loan, 3.85% interest rate, due in 2030 | |||
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 3.85% | ||
Fixed rate loan, 3.56% interest rate, due in 2030 | |||
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 3.56% | ||
Floating Rate Loan | |||
Debt Instrument [Line Items] | |||
Total indebtedness, net | $ 1,400,000 | ||
Floating Rate Loan | Floating Rate Loan, 6.18%, due in 2024 | |||
Debt Instrument [Line Items] | |||
Number of properties used as collateral | property | 104 | ||
Total principal balance | $ 1,235,000 | 1,235,000 | |
Interest rate (as a percent) | 6.18% | ||
Net book value of collateral | $ 1,049,983 | 1,071,815 | |
Floating Rate Loan | Floating Rate Loan, 6.17%, due in 2024 | |||
Debt Instrument [Line Items] | |||
Number of properties used as collateral | property | 82 | ||
Total principal balance | $ 1,400,000 | 1,400,000 | |
Interest rate (as a percent) | 6.17% | ||
Net book value of collateral | $ 1,870,541 | 1,909,185 | |
Fixed Rate Loan | Fixed Rate Loan, 4.31%, due in 2029 | |||
Debt Instrument [Line Items] | |||
Number of properties used as collateral | property | 186 | ||
Total principal balance | $ 650,000 | 650,000 | |
Interest rate (as a percent) | 4.31% | ||
Net book value of collateral | $ 489,901 | 490,416 | |
Fixed Rate Loan | Fixed Rate Loan, 4.42%, due in 2032 | |||
Debt Instrument [Line Items] | |||
Number of properties used as collateral | property | 17 | ||
Total principal balance | $ 700,000 | 700,000 | |
Interest rate (as a percent) | 4.42% | ||
Net book value of collateral | $ 508,383 | 518,806 | |
Fixed Rate Loan | Fixed rate loan, 6.25% due in 2030 | |||
Debt Instrument [Line Items] | |||
Number of properties used as collateral | property | 4 | ||
Total principal balance | $ 91,000 | 0 | |
Interest rate (as a percent) | 6.25% | ||
Net book value of collateral | $ 184,375 | 0 | |
Fixed Rate Loan | Fixed rate loan, 3.67% interest rate, due in 2031 | |||
Debt Instrument [Line Items] | |||
Number of properties used as collateral | property | 1 | ||
Total principal balance | $ 11,712 | 12,691 | |
Interest rate (as a percent) | 3.67% | ||
Net book value of collateral | $ 29,094 | 30,800 | |
Fixed Rate Loan | Fixed Rate Loan, 4.14%, due in 2032 | |||
Debt Instrument [Line Items] | |||
Number of properties used as collateral | property | 1 | ||
Total principal balance | $ 13,228 | 14,144 | |
Interest rate (as a percent) | 4.14% | ||
Net book value of collateral | $ 43,826 | 44,777 | |
Fixed Rate Loan | Fixed rate loan, 4.02% interest rate, due in 2033 | |||
Debt Instrument [Line Items] | |||
Number of properties used as collateral | property | 1 | ||
Total principal balance | $ 29,213 | 30,949 | |
Interest rate (as a percent) | 4.02% | ||
Net book value of collateral | $ 85,380 | 87,143 | |
Fixed Rate Loan | Fixed rate loan, 4.13% interest rate, due in 2033 | |||
Debt Instrument [Line Items] | |||
Number of properties used as collateral | property | 1 | ||
Total principal balance | $ 40,832 | 43,219 | |
Interest rate (as a percent) | 4.13% | ||
Net book value of collateral | $ 130,197 | 131,539 | |
Fixed Rate Loan | Fixed rate loan, 3.10% interest rate, due in 2035 | |||
Debt Instrument [Line Items] | |||
Number of properties used as collateral | property | 1 | ||
Total principal balance | $ 24,873 | 26,175 | |
Interest rate (as a percent) | 3.10% | ||
Net book value of collateral | $ 46,725 | 47,718 | |
Fixed Rate Loan | Fixed rate loan, 2.95% interest rate, due in 2036 | |||
Debt Instrument [Line Items] | |||
Number of properties used as collateral | property | 1 | ||
Total principal balance | $ 40,087 | 42,087 | |
Interest rate (as a percent) | 2.95% | ||
Net book value of collateral | $ 99,805 | 101,896 | |
Fixed Rate Loan | Fixed rate loan, 4.27% interest rate, due in 2037 | |||
Debt Instrument [Line Items] | |||
Number of properties used as collateral | property | 1 | ||
Total principal balance | $ 44,423 | 46,109 | |
Interest rate (as a percent) | 4.27% | ||
Net book value of collateral | $ 110,881 | 113,063 | |
Fixed Rate Loan | Fixed rate loan, 3.25% interest rate, due in 2038 | |||
Debt Instrument [Line Items] | |||
Number of properties used as collateral | property | 1 | ||
Total principal balance | $ 50,002 | 52,031 | |
Interest rate (as a percent) | 3.25% | ||
Net book value of collateral | $ 114,259 | 116,607 | |
Fixed Rate Loan | Fixed rate loan, 3.76% interest rate, due in 2028 | |||
Debt Instrument [Line Items] | |||
Number of properties used as collateral | property | 1 | ||
Total principal balance | $ 0 | 13,556 | |
Net book value of collateral | $ 0 | 63,314 | |
Fixed Rate Loan | Fixed rate loan, 3.77% interest rate, due in 2030 | |||
Debt Instrument [Line Items] | |||
Number of properties used as collateral | property | 1 | ||
Total principal balance | $ 0 | 4,865 | |
Net book value of collateral | $ 0 | 39,724 | |
Fixed Rate Loan | Fixed rate loan, 3.85% interest rate, due in 2030 | |||
Debt Instrument [Line Items] | |||
Number of properties used as collateral | property | 1 | ||
Total principal balance | $ 0 | 5,145 | |
Net book value of collateral | $ 0 | 39,724 | |
Fixed Rate Loan | Fixed rate loan, 3.56% interest rate, due in 2030 | |||
Debt Instrument [Line Items] | |||
Number of properties used as collateral | property | 1 | ||
Total principal balance | $ 0 | 14,392 | |
Net book value of collateral | $ 0 | $ 50,825 |
Indebtedness - Narrative (Details) $ in Thousands |
1 Months Ended | 3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|---|
May 31, 2023
USD ($)
mortgage
property
|
Sep. 30, 2023
USD ($)
|
Sep. 30, 2022
USD ($)
|
Sep. 30, 2023
USD ($)
property
option
|
Sep. 30, 2022
USD ($)
|
Dec. 31, 2022
USD ($)
|
|
Debt Instrument [Line Items] | ||||||
Debt outstanding | $ 4,303,631 | $ 4,244,501 | $ 4,303,631 | $ 4,244,501 | ||
Number of outstanding mortgage loans | mortgage | 4 | |||||
Aggregate outstanding principal balance | 4,330,370 | 4,330,370 | $ 4,290,363 | |||
Loss on extinguishment of debt | $ 0 | $ 21,370 | $ 359 | $ 22,198 | ||
Interest Rate Swap | Cash Flow Hedging | Designated as Hedging Instrument | ||||||
Debt Instrument [Line Items] | ||||||
Derivative, interest rate cap (as a percent) | 2.70% | 2.70% | ||||
Floating Rate Loan, 6.17%, due in 2024 | ||||||
Debt Instrument [Line Items] | ||||||
Weighted average interest rate (as a percent) | 4.94% | 4.23% | ||||
ILPT Floating Rate Loan | Interest Rate Swap | Cash Flow Hedging | Designated as Hedging Instrument | ||||||
Debt Instrument [Line Items] | ||||||
Derivative, interest rate cap (as a percent) | 2.25% | 2.25% | ||||
ILPT Floating Rate Loan | Secured Overnight Financing Rate (SOFR) | Interest Rate Swap | Cash Flow Hedging | Designated as Hedging Instrument | ||||||
Debt Instrument [Line Items] | ||||||
Derivative, interest rate cap (as a percent) | 2.25% | 2.25% | ||||
Floating Rate Loan | Interest Rate Swap | Cash Flow Hedging | Designated as Hedging Instrument | ||||||
Debt Instrument [Line Items] | ||||||
Derivative, interest rate cap (as a percent) | 3.40% | 3.40% | ||||
Floating Rate Loan | Secured Overnight Financing Rate (SOFR) | Interest Rate Swap | Cash Flow Hedging | Designated as Hedging Instrument | ||||||
Debt Instrument [Line Items] | ||||||
Derivative, interest rate cap (as a percent) | 3.40% | 3.40% | ||||
ILPT Floating Rate Loan | Floating Rate Loan, 6.18%, due in 2024 | ||||||
Debt Instrument [Line Items] | ||||||
Debt outstanding | $ 1,235,000 | $ 1,235,000 | ||||
Number of options to extend maturity date | option | 3 | |||||
Extension period | 1 year | |||||
Weighted average interest rate (as a percent) | 6.18% | 6.18% | ||||
ILPT Floating Rate Loan | Floating Rate Loan, 6.18%, due in 2024 | Secured Overnight Financing Rate (SOFR) | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate (as a percent) | 3.93% | |||||
Floating Rate Loan | ||||||
Debt Instrument [Line Items] | ||||||
Debt outstanding | $ 1,400,000 | $ 1,400,000 | ||||
Floating Rate Loan | Floating Rate Loan, 6.18%, due in 2024 | ||||||
Debt Instrument [Line Items] | ||||||
Number of properties used as collateral | property | 104 | |||||
Aggregate outstanding principal balance | $ 1,235,000 | $ 1,235,000 | 1,235,000 | |||
Floating Rate Loan | Floating Rate Loan, 6.17%, due in 2024 | ||||||
Debt Instrument [Line Items] | ||||||
Number of options to extend maturity date | option | 3 | |||||
Extension period | 1 year | |||||
Weighted average interest rate (as a percent) | 6.17% | 6.17% | ||||
Prepayment terms without premium amount | $ 280,000 | $ 280,000 | ||||
Number of properties used as collateral | property | 82 | |||||
Aggregate outstanding principal balance | $ 1,400,000 | $ 1,400,000 | $ 1,400,000 | |||
Floating Rate Loan | Floating Rate Loan, 6.17%, due in 2024 | Secured Overnight Financing Rate (SOFR) | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate (as a percent) | 2.77% | |||||
Mortgage Note Payable | Fixed Rate Loan, 6.25%, Due in 2030 | Joint Venture | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, face amount | $ 91,000 | |||||
Number of properties used as collateral | property | 4 | |||||
Annual interest rate (as a percent) | 6.25% | |||||
Aggregate outstanding principal balance | $ 35,910 | |||||
Weighted average interest rate (as a percent) | 3.70% | |||||
Loss on extinguishment of debt | $ 359 |
Fair Value of Assets and Liabilities - Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands |
Sep. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Fair Value of Financial Instruments | ||
Interest rate (as a percent) | 5.47% | |
Fixed rate loan | $ 4,303,631 | $ 4,244,501 |
Unamortized premiums | $ 8,751 | 8,628 |
Fixed rate loan, 4.31% interest rate, due in 2029 | ||
Fair Value of Financial Instruments | ||
Interest rate (as a percent) | 4.31% | |
Fixed rate loan, 6.25% interest rate, due in 2030 | ||
Fair Value of Financial Instruments | ||
Interest rate (as a percent) | 6.25% | |
Fixed rate loan, 3.67% interest rate, due in 2031 | ||
Fair Value of Financial Instruments | ||
Interest rate (as a percent) | 3.67% | |
Fixed rate loan, 4.42% interest rate, due in 2032 | ||
Fair Value of Financial Instruments | ||
Interest rate (as a percent) | 4.42% | |
Fixed rate loan, 4.14% interest rate, due in 2032 | ||
Fair Value of Financial Instruments | ||
Interest rate (as a percent) | 4.14% | |
Fixed rate loan, 4.02% interest rate, due in 2033 | ||
Fair Value of Financial Instruments | ||
Interest rate (as a percent) | 4.02% | |
Fixed rate loan, 4.13% interest rate, due in 2033 | ||
Fair Value of Financial Instruments | ||
Interest rate (as a percent) | 4.13% | |
Fixed rate loan, 3.10% interest rate, due in 2035 | ||
Fair Value of Financial Instruments | ||
Interest rate (as a percent) | 3.10% | |
Fixed rate loan, 2.95% interest rate, due in 2036 | ||
Fair Value of Financial Instruments | ||
Interest rate (as a percent) | 2.95% | |
Fixed rate loan, 4.27% interest rate, due in 2037 | ||
Fair Value of Financial Instruments | ||
Interest rate (as a percent) | 4.27% | |
Fixed rate loan, 3.25% interest rate, due in 2038 | ||
Fair Value of Financial Instruments | ||
Interest rate (as a percent) | 3.25% | |
Fixed rate loan, 3.76% interest rate, due in 2028 | ||
Fair Value of Financial Instruments | ||
Interest rate (as a percent) | 3.76% | |
Fixed rate loan, 3.77% interest rate, due in 2030 | ||
Fair Value of Financial Instruments | ||
Interest rate (as a percent) | 3.77% | |
Fixed rate loan, 3.85% interest rate, due in 2030 | ||
Fair Value of Financial Instruments | ||
Interest rate (as a percent) | 3.85% | |
Fixed rate loan, 3.56% interest rate, due in 2030 | ||
Fair Value of Financial Instruments | ||
Interest rate (as a percent) | 3.56% | |
Carrying Amount | ||
Fair Value of Financial Instruments | ||
Long-term debt | $ 1,686,618 | 1,646,736 |
Carrying Amount | Fixed rate loan, 4.31% interest rate, due in 2029 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 647,077 | 646,669 |
Carrying Amount | Fixed rate loan, 6.25% interest rate, due in 2030 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 90,038 | 0 |
Carrying Amount | Fixed rate loan, 3.67% interest rate, due in 2031 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 11,712 | 12,691 |
Carrying Amount | Fixed rate loan, 4.42% interest rate, due in 2032 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 695,134 | 694,704 |
Carrying Amount | Fixed rate loan, 4.14% interest rate, due in 2032 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 13,228 | 14,144 |
Carrying Amount | Fixed rate loan, 4.02% interest rate, due in 2033 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 29,213 | 30,949 |
Carrying Amount | Fixed rate loan, 4.13% interest rate, due in 2033 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 40,832 | 43,219 |
Carrying Amount | Fixed rate loan, 3.10% interest rate, due in 2035 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 24,873 | 26,175 |
Carrying Amount | Fixed rate loan, 2.95% interest rate, due in 2036 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 40,087 | 42,087 |
Carrying Amount | Fixed rate loan, 4.27% interest rate, due in 2037 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 44,423 | 46,109 |
Carrying Amount | Fixed rate loan, 3.25% interest rate, due in 2038 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 50,001 | 52,031 |
Carrying Amount | Fixed rate loan, 3.76% interest rate, due in 2028 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 0 | 13,556 |
Carrying Amount | Fixed rate loan, 3.77% interest rate, due in 2030 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 0 | 4,865 |
Carrying Amount | Fixed rate loan, 3.85% interest rate, due in 2030 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 0 | 5,145 |
Carrying Amount | Fixed rate loan, 3.56% interest rate, due in 2030 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 0 | 14,392 |
Estimated Fair Value | ||
Fair Value of Financial Instruments | ||
Long-term debt | 1,548,147 | 1,487,147 |
Estimated Fair Value | Fixed rate loan, 4.31% interest rate, due in 2029 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 613,520 | 592,295 |
Estimated Fair Value | Fixed rate loan, 6.25% interest rate, due in 2030 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 94,438 | 0 |
Estimated Fair Value | Fixed rate loan, 3.67% interest rate, due in 2031 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 11,009 | 11,713 |
Estimated Fair Value | Fixed rate loan, 4.42% interest rate, due in 2032 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 609,714 | 623,133 |
Estimated Fair Value | Fixed rate loan, 4.14% interest rate, due in 2032 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 12,611 | 13,182 |
Estimated Fair Value | Fixed rate loan, 4.02% interest rate, due in 2033 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 27,185 | 28,195 |
Estimated Fair Value | Fixed rate loan, 4.13% interest rate, due in 2033 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 38,181 | 39,573 |
Estimated Fair Value | Fixed rate loan, 3.10% interest rate, due in 2035 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 21,837 | 22,373 |
Estimated Fair Value | Fixed rate loan, 2.95% interest rate, due in 2036 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 34,723 | 35,444 |
Estimated Fair Value | Fixed rate loan, 4.27% interest rate, due in 2037 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 41,466 | 41,880 |
Estimated Fair Value | Fixed rate loan, 3.25% interest rate, due in 2038 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 43,463 | 43,878 |
Estimated Fair Value | Fixed rate loan, 3.76% interest rate, due in 2028 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 0 | 12,784 |
Estimated Fair Value | Fixed rate loan, 3.77% interest rate, due in 2030 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 0 | 4,553 |
Estimated Fair Value | Fixed rate loan, 3.85% interest rate, due in 2030 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | 0 | 4,829 |
Estimated Fair Value | Fixed rate loan, 3.56% interest rate, due in 2030 | ||
Fair Value of Financial Instruments | ||
Fixed rate loan | $ 0 | $ 13,315 |
Fair Value of Assets and Liabilities - Assets Measured on Recurring Basis (Details) $ in Thousands |
9 Months Ended | 12 Months Ended |
---|---|---|
Sep. 30, 2023
USD ($)
property
|
Dec. 31, 2022
USD ($)
property
|
|
Fair Value of Financial Instruments | ||
Real estate properties | $ 4,765,820 | $ 4,902,641 |
Fair Value, Recurring | ||
Fair Value of Financial Instruments | ||
Investment in unconsolidated joint venture | 124,411 | 124,358 |
Interest rate cap derivatives | 51,322 | 73,133 |
Fair Value, Recurring | Fair Value, Inputs, Level 1 | ||
Fair Value of Financial Instruments | ||
Investment in unconsolidated joint venture | 0 | 0 |
Interest rate cap derivatives | 0 | 0 |
Fair Value, Recurring | Fair Value, Inputs, Level 2 | ||
Fair Value of Financial Instruments | ||
Investment in unconsolidated joint venture | 0 | 0 |
Interest rate cap derivatives | 51,322 | 73,133 |
Fair Value, Recurring | Fair Value, Inputs, Level 3 | ||
Fair Value of Financial Instruments | ||
Investment in unconsolidated joint venture | 124,411 | 124,358 |
Interest rate cap derivatives | 0 | 0 |
Fair Value, Nonrecurring | ||
Fair Value of Financial Instruments | ||
Real estate properties | 1,414 | 555,123 |
Fair Value, Nonrecurring | Fair Value, Inputs, Level 1 | ||
Fair Value of Financial Instruments | ||
Real estate properties | 0 | 0 |
Fair Value, Nonrecurring | Fair Value, Inputs, Level 2 | ||
Fair Value of Financial Instruments | ||
Real estate properties | 0 | 0 |
Fair Value, Nonrecurring | Fair Value, Inputs, Level 3 | ||
Fair Value of Financial Instruments | ||
Real estate properties | $ 1,414 | $ 555,123 |
Number of properties impaired | property | 1 | 25 |
Fair Value of Assets and Liabilities - Fair Value Measurements Significant Unobservable Inputs Related to Certain Level 3 (Details) - Fair Value, Inputs, Level 3 |
Sep. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Measurement Input, Discount Rate | Minimum | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Investment in unconsolidated joint venture | 0.0525 | 0.0525 |
Measurement Input, Discount Rate | Maximum | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Investment in unconsolidated joint venture | 0.0700 | 0.0700 |
Measurement Input, Exit Capitalization Rate | Minimum | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Investment in unconsolidated joint venture | 0.0495 | 0.0475 |
Measurement Input, Exit Capitalization Rate | Maximum | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Investment in unconsolidated joint venture | 0.0600 | 0.0600 |
Measurement Input, Holdings Periods | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Investment in unconsolidated joint venture, holding periods | 10 years | |
Measurement Input, Holdings Periods | Minimum | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Investment in unconsolidated joint venture, holding periods | 10 years | |
Measurement Input, Holdings Periods | Maximum | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Investment in unconsolidated joint venture, holding periods | 12 years |
Fair Value of Assets and Liabilities - Changes In Fair Value For Our Investment In Unconsolidated Joint Venture (Details) - Equity Method Investments - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning balance | $ 129,082 | $ 143,716 | $ 124,358 | $ 143,021 |
Equity in earnings of unconsolidated joint venture | 719 | 3,297 | 7,423 | 6,634 |
Distributions from unconsolidated joint venture | (5,390) | (1,320) | (7,370) | (3,962) |
Ending balance | $ 124,411 | $ 145,693 | $ 124,411 | $ 145,693 |
Shareholders' Equity - Narrative (Details) $ / shares in Units, $ in Thousands |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Oct. 12, 2023
USD ($)
$ / shares
|
Sep. 13, 2023
USD ($)
$ / shares
|
Jun. 01, 2023
trustee
$ / shares
shares
|
Sep. 30, 2023
$ / shares
shares
|
Sep. 30, 2023
$ / shares
shares
|
|
Shareholders' Equity | |||||
Number of officers | trustee | 7 | ||||
Subsequent Event | |||||
Shareholders' Equity | |||||
Common distributions declared (in dollars per share) | $ 0.01 | ||||
Dividends payable | $ | $ 658 | ||||
Common Stock | |||||
Shareholders' Equity | |||||
Share repurchases to pay for tax withholding (in shares) | shares | 40,636 | 48,722 | |||
Common Stock | Minimum | |||||
Shareholders' Equity | |||||
Share price (in dollars per share) | $ 3.54 | $ 3.54 | |||
Common Stock | Maximum | |||||
Shareholders' Equity | |||||
Share price (in dollars per share) | $ 3.29 | $ 3.29 | |||
Trustee | |||||
Shareholders' Equity | |||||
Common shares granted (in shares) | shares | 20,000 | ||||
Common share price (in dollars per share) | $ 1.78 | ||||
Officer | |||||
Shareholders' Equity | |||||
Common share price (in dollars per share) | $ 3.63 | ||||
Common share forfeiture (in shares) | $ | $ 188,350 |
Shareholders' Equity - Schedule of Distributions Declared and Paid (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 9 Months Ended | ||||||||
---|---|---|---|---|---|---|---|---|---|---|
Aug. 17, 2023 |
May 18, 2023 |
Feb. 16, 2023 |
Sep. 30, 2023 |
Jun. 30, 2023 |
Mar. 31, 2023 |
Sep. 30, 2022 |
Jun. 30, 2022 |
Mar. 31, 2022 |
Sep. 30, 2023 |
|
Equity [Abstract] | ||||||||||
Dividends paid (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.03 | ||||||
Total Distribution | $ 656 | $ 656 | $ 656 | $ 656 | $ 656 | $ 656 | $ 654 | $ 21,583 | $ 21,584 | $ 1,968 |
Business and Property Management Agreements with RMR (Details) |
3 Months Ended | 9 Months Ended | 12 Months Ended | ||
---|---|---|---|---|---|
Sep. 30, 2023
USD ($)
employee
agreement
|
Sep. 30, 2022
USD ($)
|
Sep. 30, 2023
USD ($)
employee
agreement
|
Sep. 30, 2022
USD ($)
|
Dec. 31, 2022
USD ($)
|
|
Related Party Transaction [Line Items] | |||||
Number of employees | employee | 0 | 0 | |||
Other operating expenses | $ 9,907,000 | $ 8,453,000 | $ 27,744,000 | $ 22,278,000 | |
Property Management and Construction Supervision Fees | |||||
Related Party Transaction [Line Items] | |||||
Related party transaction, amount | 3,464,000 | 3,270,000 | 10,286,000 | 8,797,000 | |
Capitalized Property Management and Construction Supervision Fees | |||||
Related Party Transaction [Line Items] | |||||
Related party transaction, amount | 171,000 | 294,000 | 541,000 | 693,000 | |
Reimbursed Property Level Operating Expenses | |||||
Related Party Transaction [Line Items] | |||||
Related party transaction, amount | $ 2,375,000 | 1,847,000 | $ 6,216,000 | 5,155,000 | |
Related Party | |||||
Related Party Transaction [Line Items] | |||||
Number of management service agreements | agreement | 2 | 2 | |||
Management fee expense | $ 5,919,000 | 6,465,000 | $ 17,301,000 | 17,821,000 | |
Incentive fee expense | $ 0 | 0 | $ 0 | 0 | $ 0 |
Management service agreement term | 3 years | ||||
Number of joint venture agreements | agreement | 2 | 2 | |||
Related Party | Reit Management And Research L L C | |||||
Related Party Transaction [Line Items] | |||||
Number of management service agreements | agreement | 2 | 2 | |||
Related Party | Expensed Property Management and Construction Supervision Fees | |||||
Related Party Transaction [Line Items] | |||||
Other operating expenses | $ 3,293,000 | $ 2,976,000 | $ 9,745,000 | $ 8,104,000 |
Related Person Transactions (Details) $ in Thousands |
Sep. 30, 2023
USD ($)
agreement
|
Dec. 31, 2022
USD ($)
|
---|---|---|
Related Party | ||
Related Party Transaction [Line Items] | ||
Number of management service agreements | 2 | |
Number of joint venture agreements | 2 | |
Accounts payable and other liabilities | $ | $ 5,896 | $ 4,824 |
Joint Venture | ||
Related Party Transaction [Line Items] | ||
Number of joint venture agreements | 2 | |
Accounts payable and other liabilities | $ | $ 613 | $ 616 |
Derivatives and Hedging Activities - Schedule of Interest Rate Cap Agreements (Details) - Interest Rate Swap - Cash Flow Hedging - Designated as Hedging Instrument - USD ($) |
Sep. 30, 2023 |
Dec. 31, 2022 |
Sep. 30, 2022 |
---|---|---|---|
Derivative Instruments, Gain (Loss) [Line Items] | |||
Strike rate | 2.70% | ||
Amount | $ 1,385,158,000 | ||
Fair value | $ 51,322,000 | $ 73,133,000 | $ 7,740,000 |
Floating Rate Loan | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Strike rate | 3.40% | ||
Amount | $ 1,400,000,000 | ||
Fair value | $ 12,712,000 | 23,337,000 | |
ILPT Floating Rate Loan | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Strike rate | 2.25% | ||
Amount | $ 1,235,000,000 | ||
Fair value | $ 38,610,000 | $ 49,796,000 |
Derivatives and Hedging Activities - Narrative (Details) |
1 Months Ended | ||
---|---|---|---|
Sep. 30, 2022
USD ($)
property
derivative_instrument
|
Sep. 30, 2023
USD ($)
|
Dec. 31, 2022
USD ($)
|
|
Derivative Instruments, Gain (Loss) [Line Items] | |||
Debt outstanding | $ 4,244,501,000 | $ 4,303,631,000 | |
Bridge Loan | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Debt outstanding | $ 1,385,158,000 | ||
Number of properties used as collateral | property | 109 | ||
Interest Rate Swap | Cash Flow Hedging | Designated as Hedging Instrument | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Number of Instruments | derivative_instrument | 2 | ||
Amount | $ 1,385,158,000 | ||
Derivative, interest rate cap (as a percent) | 2.70% | ||
Derivative instruments in hedges, at fair value, net | $ 7,740,000 | $ 51,322,000 | $ 73,133,000 |
Derivatives and Hedging Activities - Schedule of Activity (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of gain recognized in cumulative other comprehensive income | $ 3,428 | $ 15,047 | $ 19,677 | $ 24,200 |
Unrealized (loss) gain on derivative instrument recognized in cumulative other comprehensive loss | (6,635) | 8,847 | (3,392) | 18,917 |
Loss on Early Extinguishment | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount reclassified from cumulative other comprehensive income | (10,063) | 761 | (23,069) | 1,678 |
Interest Expense | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount reclassified from cumulative other comprehensive income | $ 0 | $ (6,961) | $ 0 | $ (6,961) |
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