What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2024-10-29 compared with 2024-07-30 · 132 added, 85 removed, 380 unchanged (36% of the section changed)

3 unchanged sentences

(dollars in thousands, except per share data)

June 30, December 31,

September 30, December 31,

Real estate properties:

26 unchanged sentences

Cumulative net (deficit) income ( 62,372 ) 9,196

Cumulative other comprehensive income 5,235 10,171

Cumulative other comprehensive (loss) income ( 1,749 ) 10,171

Cumulative common distributions ( 367,824 ) ( 365,848 )

7 unchanged sentences

(amounts in thousands, except per share data)

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

19 unchanged sentences

Net loss attributable to common shareholders ( 24,990 ) ( 26,112 ) ( 71,568 ) ( 76,749 )

Other comprehensive income:

Unrealized (loss) gain on derivatives

( 1,510 ) 12,021 ( 6,356 ) 3,243

unrealized (gain) loss on derivatives attributable to noncontrolling interest ( 468 ) ( 419 ) 1,420 1,341

Other comprehensive income (loss):

Unrealized loss on derivatives ( 8,972 ) ( 6,635 ) ( 15,328 ) ( 3,392 )

unrealized loss on derivatives attributable to noncontrolling interest 1,988 2,290 3,408 3,631

Other comprehensive (loss) income attributable to common shareholders

12 unchanged sentences

Noncontrolling Total

Shares Shares Capital Income Income

Distributions Shareholders

Shares Shares Capital Income Income (Loss) Distributions Shareholders

Interest Equity

12 unchanged sentences

Balance at June 30, 2024 65,992,509 660 1,016,980 ( 37,382 ) 5,235 ( 367,165 ) 618,328 469,439 1,087,767

Net loss — — — ( 24,990 ) — — ( 24,990 ) ( 10,417 ) ( 35,407 )

Share grants, repurchases and forfeitures 151,913 1 192 — — — 193 — 193

Distributions to common shareholders — — — — — ( 659 ) ( 659 ) — ( 659 )

Other comprehensive loss — — — — ( 6,984 ) — ( 6,984 ) ( 1,988 ) ( 8,972 )

Distributions to noncontrolling interest — — — — — — — ( 163 ) ( 163 )

Balance at September 30, 2024 66,144,422 $ 661 $ 1,017,172 $ ( 62,372 ) $ ( 1,749 ) $ ( 367,824 ) $ 585,888 $ 456,871 $ 1,042,759

Balance at December 31, 2022 65,568,145 $ 656 $ 1,014,201 $ 117,185 $ 21,903 $ ( 363,221 ) $ 790,724 $ 540,047 $ 1,330,771

10 unchanged sentences

Balance at June 30, 2023 65,697,959 657 1,015,138 66,548 26,487 ( 364,533 ) 744,297 516,992 1,261,289

Net loss — — — ( 26,112 ) — — ( 26,112 ) ( 10,079 ) ( 36,191 )

Share grants, repurchases and forfeitures 147,114 1 330 — — — 331 — 331

Distributions to common shareholders — — — — — ( 656 ) ( 656 ) — ( 656 )

Other comprehensive loss — — — — ( 4,345 ) — ( 4,345 ) ( 2,290 ) ( 6,635 )

Balance at September 30, 2023 65,845,073 $ 658 $ 1,015,468 $ 40,436 $ 22,142 $ ( 365,189 ) $ 713,515 $ 504,623 $ 1,218,138

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

2 unchanged sentences

(dollars in thousands)

Six Months Ended June 30,

Nine Months Ended September 30,

CASH FLOWS FROM OPERATING ACTIVITIES:

2 unchanged sentences

Depreciation 94,767 93,545

Amortization of interest rate caps

31,726 18,435

Net amortization of debt issuance costs, premiums and discounts 12,580 20,177

7 unchanged sentences

General and administrative expenses paid in common shares

Other non-cash expenses 19,473 12,290

Distributions of earnings from unconsolidated joint venture 2,970 2,970

9 unchanged sentences

Real estate improvements ( 6,142 ) ( 13,649 )

Proceeds from sale of real estate — 243

Purchase of interest rate cap

Proceeds from settlement of derivatives 52,365 40,426

Proceeds from sale of real estate — 243

Distributions in excess of earnings from unconsolidated joint venture — 4,400

Net cash provided by investing activities 20,048 31,420

18 unchanged sentences

The following table provides a reconciliation of cash and cash equivalents and restricted cash and cash equivalents reported within the condensed consolidated balance sheets to the amounts shown in the condensed consolidated statements of cash flows:

As of June 30,

As of September 30,

Cash and cash equivalents $ 153,863 $ 83,283

21 unchanged sentences

Recent Accounting Pronouncements

New Accounting Pronouncements.

In November 2023, the Financial Accounting Standards Board issued Accounting Standards Update, or ASU, 2023-07, Segment Reporting (Topic 280):

5 unchanged sentences

ASU 2023-07 is required to be applied retrospectively and is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted.

We are currently evaluating the impact ASU 2023-07 will have on our condensed consolidated financial statements.

We expect to include additional disclosures in the notes to our condensed consolidated financial statements as a result of the implementation of ASU 2023-07;

however, these changes are not expected to have a material effect on our condensed consolidated financial statements.

Real Estate Investments

As of June 30, 2024, our portfolio was comprised of 411 properties containing approximately 59,893,000 rentable square feet located in 39 states, including 226 buildings, leasable land parcels and easements containing approximately 16,729,000 rentable square feet that were primarily industrial lands located on the island of Oahu, Hawaii, or our Hawaii Properties, and 185 properties containing approximately 43,164,000 rentable square feet that were industrial and logistics properties 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 Mountain Industrial REIT LLC, or Mountain JV, or our consolidated joint venture, in which we own a 61 % equity interest.

As of June 30, 2024, we also owned a 22 % equity interest in an unconsolidated joint venture.

As of September 30, 2024, our portfolio was comprised of 411 properties containing approximately 59,890,000 rentable square feet located in 39 states, including 226 buildings, leasable land parcels and easements containing approximately 16,729,000 rentable square feet that were primarily industrial lands located on the island of Oahu, Hawaii, or our Hawaii Properties, and 185 properties containing approximately 43,161,000 rentable square feet that were industrial and logistics properties located in 38 other states, or our Mainland Properties, which included 94 properties in 27 states totaling approximately 20,978,000 rentable square feet, owned by Mountain Industrial REIT LLC, or Mountain JV, or our consolidated joint venture, in which we own a 61 % equity interest.

As of September 30, 2024, we also owned a 22 % equity interest in The Industrial Fund REIT LLC, or the unconsolidated joint venture.

We operate in one business segment:

3 unchanged sentences

(dollars in thousands, except per share data)

During the three and six months ended June 30, 2024 and 2023, amounts capitalized at our properties for tenant improvements, leasing costs, building improvements and development, redevelopment and other activities were as follows:

Three Months Ended June 30, Six Months Ended June 30,

During the three and nine months ended September 30, 2024 and 2023, amounts capitalized at our properties for tenant improvements, leasing costs, building improvements and development, redevelopment and other activities were as follows:

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

11 unchanged sentences

(3) Development, redevelopment and other activities generally include capital expenditure projects that reposition a property or result in new sources of revenues.

During the six months ended June 30, 2024, we committed $ 4,348 for expenditures related to tenant improvements and leasing costs for leases executed during the period for approximately 2,609,000 rentable square feet.

Committed, but unspent, tenant related obligations based on existing leases as of June 30, 2024 were $ 5,646 , all of which is expected to be spent during the next 12 months.

During the three and nine months ended September 30, 2024 and 2023, recognized net income (loss) attributable to noncontrolling interest in our condensed consolidated financial statements was as follows:

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

Consolidated joint venture $ ( 10,428 ) $ ( 10,238 ) $ ( 31,256 ) $ ( 31,642 )

Tenancy in common 11 159 36 74

$ ( 10,417 ) $ ( 10,079 ) $ ( 31,220 ) $ ( 31,568 )

Consolidated Joint Venture

We own a 61 % equity interest in our consolidated joint venture.

We control this consolidated joint venture and therefore account for the properties owned by this joint venture on a consolidated basis in our condensed consolidated financial statements.

We recognized net loss attributable to noncontrolling interest in our condensed consolidated financial statements for the three months ended June 30, 2024 and 2023 of $ 10,314 and $ 10,676 , respectively, and $ 20,828 and $ 21,404 for the six months ended June 30, 2024 and 2023, respectively.

As of June 30, 2024, our consolidated joint venture had total assets of $ 2,964,265 and total liabilities of $ 1,769,499 .

As of September 30, 2024, our consolidated joint venture had total assets of $ 2,932,320 and total liabilities of $ 1,769,384 .

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.

We recognized net income (loss) attributable to noncontrolling interest in our condensed consolidated financial statements for the three months ended June 30, 2024 and 2023 of $ 10 and $( 76 ), respectively, and $ 25 and $( 85 ) for the six months ended June 30, 2024 and 2023, respectively.

The tenancy in common made cash distributions to the unrelated third party investor of $ 0 and $ 225 during the three months ended June 30, 2024 and 2023, respectively, and cash distributions of $ 163 and $ 225 during the six months ended June 30, 2024 and 2023, respectively.

As of June 30, 2024, the tenancy in common had total assets of $ 10,786 and total liabilities of $ 188 .

The tenancy in common made cash distributions to the unrelated third party investor of $ 163 and $ 0 during the three months ended September 30, 2024 and 2023, respectively, and cash distributions of $ 326 and $ 225 during the nine months ended September 30, 2024 and 2023, respectively.

As of September 30, 2024, the tenancy in common had total assets of $ 10,388 and total liabilities of $ 250 .

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 own a 22 % equity interest in 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 using 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).

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 and are generally classified as operating leases.

INDUSTRIAL LOGISTICS PROPERTIES TRUST

1 unchanged sentence

(dollars in thousands, except per share data)

We are a lessor of industrial and logistics properties.

Our leases provide for base rent payments and may also include variable payments.

Rental income from operating leases, including any payments derived by index or market-based indices, is recognized 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.

Some of our leases have options to extend or terminate the lease exercisable at the option of our tenants, which are considered when determining the lease term.

Allowances for bad debts are recognized as a direct reduction of rental income.

In certain circumstances, some leases provide the tenant with the right to terminate if the legislature or other funding authority does not appropriate the funding necessary for the tenant to meet its lease obligations;

we have determined the fixed non-cancelable lease term of these leases to be the full term of the lease because we believe the occurrence of early terminations to be a remote contingency based on both our historical experience and our assessments of the likelihood of lease cancellation on a separate lease basis.

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 $ 19,067 and $ 18,291 for the three months ended June 30, 2024 and 2023, respectively, and $ 40,242 and $ 39,390 for the six months ended June 30, 2024 and 2023, respectively.

Such payments totaled $ 18,997 and $ 19,310 for the three months ended September 30, 2024 and 2023, respectively, and $ 60,228 and $ 58,700 for the nine months ended September 30, 2024 and 2023, 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.

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 the ground lease in order to protect our investment in the affected property.

Right of Use Assets and Lease Liabilities

1 unchanged sentence

For leases with a term greater than 12 months under which we are the lessee, we recognize right of use assets and lease liabilities.

The values of our right of use assets and related lease liabilities were $ 4,421 and $ 4,512 , respectively, as of June 30, 2024, and $ 4,646 and $ 4,730 , respectively, as of December 31, 2023.

The values of our right of use assets and related lease liabilities were $ 4,308 and $ 4,401 , respectively, as of September 30, 2024, and $ 4,646 and $ 4,730 , respectively, as of December 31, 2023.

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.

Geographic Concentration

For the three months ended June 30, 2024 and 2023, our Hawaii Properties represented 27.2 % and 28.1 %, respectively, of our rental income.

For the six months ended June 30, 2024 and 2023, our Hawaii Properties represented 27.6 % and 27.8 %, respectively, of our rental income.

For the three months ended September 30, 2024 and 2023, our Hawaii Properties represented 26.9 % and 28.1 %, respectively, of our rental income.

For the nine months ended September 30, 2024 and 2023, our Hawaii Properties represented 27.4 % and 27.9 %, respectively, of our rental income.

Tenant Concentration

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 amortization of deferred leasing costs.

Subsidiaries of FedEx Corporation, or FedEx, and subsidiaries of Amazon.com Services, Inc., or Amazon, represented 29.0 % and 6.8 % of our annualized rental revenues as of June 30, 2024, respectively, and 29.6 % and 6.8 % as of June 30, 2023, respectively.

Subsidiaries of FedEx Corporation, or FedEx, and subsidiaries of Amazon.com Services, Inc., or Amazon, represented 29.3 % and 6.8 % of our annualized rental revenues as of September 30, 2024, respectively, and 29.8 % and 6.7 % as of September 30, 2023, respectively.

INDUSTRIAL LOGISTICS PROPERTIES TRUST

1 unchanged sentence

(dollars in thousands, except per share data)

Our outstanding indebtedness as of June 30, 2024 and December 31, 2023 is summarized below:

Our outstanding indebtedness as of September 30, 2024 and December 31, 2023 is summarized below:

Properties Principal Interest Carrying Value

1 unchanged sentence

Type Maturity of Collateral

As of June 30, 2024

As of September 30, 2024

ILPT 104 $ 1,235,000 6.18 % Floating 10/09/2024 $ 1,023,379

35 unchanged sentences

(dollars in thousands, except per share data)

Our $ 1,235,000 loan, or the ILPT Floating Rate Loan, which is secured by 104 of our properties, 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 under the ILPT Floating Rate Loan was 6.18 %, including the impact of our interest rate cap on SOFR of 2.25 %, as of June 30, 2024 and December 31, 2023, and for the three and six months ended June 30, 2024 and 2023.

Our $ 1,235,000 loan, or the ILPT Floating Rate Loan, which is secured by 104 of our properties, was scheduled to mature in October 2024, subject to three , one year extension options, and required that interest be paid at an annual rate of secured overnight financing rate, or SOFR, plus a weighted average premium of 3.93 %.

In October 2024, we exercised the first of our three , one year extension options for the maturity date of this loan.

In connection with the exercise of the extension, we purchased a one year interest rate cap for $ 16,975 with a SOFR strike rate equal to 2.78 %, which replaced the previous interest rate cap with a SOFR strike rate equal to 2.25 %.

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.

As of July 30, 2024, we intend to exercise the first of our three , one year options to extend the maturity date of this loan.

Our consolidated joint venture’s $ 1,400,000 loan, or the Mountain Floating Rate Loan, matures in March 2025, subject to two remaining one year extension options, and requires that interest be paid at an annual rate of SOFR plus a premium of 2.77 %.

In March 2024, in connection with the exercise of its option to extend the maturity date of this loan to March 2025, our consolidated joint venture purchased a one year interest rate cap for $ 26,175 with a SOFR strike rate equal to 3.04 %, which replaced the previous interest rate cap with a SOFR strike rate equal to 3.40 %.

As of June 30, 2024 and December 31, 2023, the interest rate under the Mountain Floating Rate Loan was 5.81 % and 6.17 %, respectively.

The weighted average interest rate under the Mountain Floating Rate Loan was 5.81 % and 5.95 % for the three and six months ended June 30, 2024, respectively, including the impact of our interest rate caps.

The weighted average annual interest rate under the Mountain Floating Rate Loan was 6.17 % for both the three and six months ended June 30, 2023, including the impact of our interest rate caps.

Subject to the satisfaction of certain conditions, we have the option to prepay up to $ 280,000 of the Mountain Floating Rate Loan at par with no premium, and to prepay the balance of the Mountain Floating Rate Loan at any time, subject to a premium.

In March 2024, in connection with the exercise of the first of its three , one year extension options for the maturity date of this loan, our consolidated joint venture purchased a one year interest rate cap for $ 26,175 with a SOFR strike rate equal to 3.04 %, which replaced the previous interest rate cap with a SOFR strike rate equal to 3.40 %.

Subject to the satisfaction of certain conditions, we have the option to prepay the Mountain Floating Rate Loan in full or in part at any time at par with no premium.

The weighted average interest rates under our floating rate loans for the three and nine months ended September 30, 2024 were as follows:

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

ILPT Floating Rate Loan (1)

6.18 % 6.18 % 6.18 % 6.18 %

Mountain Floating Rale Loan (2)

5.81 % 6.17 % 5.90 % 6.17 %

(1) Reflects the impact of an interest rate cap with a SOFR strike rate equal to 2.25 %.

(2) Reflects the impact of interest rate caps with a current SOFR strike rate equal to 3.04 %, which replaced the previous strike rate equal to 3.40 % in March 2024.

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.

4 unchanged sentences

See Note 10 for further information regarding our interest rate caps.

The required principal payments due during the next five years and thereafter under all our outstanding debt as of June 30, 2024 are as follows:

2024 $ 1,244,140

2025 1,418,794

The required principal payments due during the next five years and thereafter under all our outstanding debt as of September 30, 2024 are as follows:

Thereafter 1,593,323

Fair Value of Assets and Liabilities

Our financial instruments include cash and cash equivalents, restricted cash and cash equivalents, mortgages and notes payable, accounts payable and interest rate caps.

As of June 30, 2024 and December 31, 2023, 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 for our fixed rate mortgage notes payable.

Our fixed rate mortgage notes payable had an aggregate carrying value of $ 1,674,158 and $ 1,682,501 as of June 30, 2024 and December 31, 2023, respectively, and a fair value of $ 1,525,930 and $ 1,553,863 as of June 30, 2024 and December 31, 2023, respectively.

We estimate the fair value of our fixed rate mortgage notes payable using significant unobservable inputs (Level 3), including discounted cash flow analyses and prevailing market interest rates.

(1) In October 2024, we exercised the first of our three , one year extension options for the maturity date of the ILPT Floating Rate Loan.

(2) Our consolidated joint venture has two remaining one year extension options for the maturity date of the Mountain Floating Rate Loan.

INDUSTRIAL LOGISTICS PROPERTIES TRUST

1 unchanged sentence

(dollars in thousands, except per share data)

The table below presents certain of our assets measured on a recurring basis at fair value as of June 30, 2024 and December 31, 2023, categorized by the level of inputs as defined in the fair value hierarchy under ASC 820, Fair Value Measurement , used in the valuation of each asset:

Fair Value of Assets and Liabilities

Our financial instruments include cash and cash equivalents, restricted cash and cash equivalents, mortgages and notes payable, accounts payable and interest rate caps.

As of September 30, 2024 and December 31, 2023, 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 for our fixed rate mortgage notes payable.

Our fixed rate mortgage notes payable had an aggregate carrying value of $ 1,669,925 and $ 1,682,501 as of September 30, 2024 and December 31, 2023, respectively, and a fair value of $ 1,599,252 and $ 1,553,863 as of September 30, 2024 and December 31, 2023, respectively.

We estimate the fair value of our fixed rate mortgage notes payable using significant unobservable inputs (Level 3), including discounted cash flow analyses and prevailing market interest rates.

The table below presents certain of our assets measured on a recurring basis at fair value as of September 30, 2024 and December 31, 2023, categorized by the level of inputs as defined in the fair value hierarchy under ASC 820, Fair Value Measurement , used in the valuation of each asset:

Quoted Prices in Significant Other Significant

2 unchanged sentences

Total (Level 1) (Level 2) (Level 3)

As of June 30, 2024

As of September 30, 2024

Investment in unconsolidated joint venture $ 117,622 $ — $ — $ 117,622

9 unchanged sentences

Technique Rates Rates Periods

As of June 30, 2024

As of September 30, 2024

Investment in unconsolidated joint venture Discounted cash flow 6.50 % - 8.00 %

4 unchanged sentences

5.25 % - 6.50 %

INDUSTRIAL LOGISTICS PROPERTIES TRUST

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

The table below presents a summary of the changes in fair value for our investment in the unconsolidated joint venture:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

3 unchanged sentences

Ending balance $ 117,622 $ 124,411 $ 117,622 $ 124,411

INDUSTRIAL LOGISTICS PROPERTIES TRUST

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

Shareholders’ Equity

1 unchanged sentence

On May 30, 2024, in accordance with our Trustee compensation arrangements, we awarded to each of our seven Trustees 23,316 of our common shares, valued at $ 3.86 per share, the closing price of our common shares on The Nasdaq Stock Market LLC, or Nasdaq, on that day.

On September 11, 2024, we awarded under our equity compensation plan an aggregate of 204,915 of our common shares, valued at $ 4.84 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 six months ended June 30, 2024, we purchased an aggregate of 14,090 of our common shares, valued at a weighted average price of $ 4.14 per common share, from certain former officers and employees of The RMR Group LLC, or RMR, in satisfaction of tax withholding and payment obligations in connection with the vesting of awards of our common shares.

During the three and nine months ended September 30, 2024, we purchased an aggregate of 53,002 and 67,092 , respectively, of our common shares, valued at a weighted average price of $ 4.78 and $ 4.65 per common share, respectively, 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 withheld and purchased these common shares at their fair market values based upon the trading prices of our common shares at the close of trading on Nasdaq on the applicable purchase dates.

Distributions

During the six months ended June 30, 2024, we declared and paid regular quarterly distributions to common shareholders as follows:

During the nine months ended September 30, 2024, we declared and paid regular quarterly distributions to common shareholders as follows:

Distribution Total

2 unchanged sentences

April 11, 2024 April 22, 2024 May 16, 2024 0.01 659

July 11, 2024 July 22, 2024 August 15, 2024 0.01 659

$ 0.03 $ 1,976

On July 11, 2024, we declared a regular quarterly distribution to common shareholders of record on July 22, 2024 of $ 0.01 per share, or approximately $ 660 .

We expect to pay this distribution to our shareholders on or about August 15, 2024 using cash on hand.

On October 16, 2024, we declared a regular quarterly distribution to common shareholders of record on October 28, 2024 of $ 0.01 per share, or approximately $ 661 .

We expect to pay this distribution to our shareholders on or about November 14, 2024 using cash on hand.

Business and Property Management Agreements with RMR

4 unchanged sentences

and (2) a property management agreement, which relates to our property level operations.

Pursuant to our business management agreement with RMR, we recognized business management fees of $ 5,809 and $ 11,639 for the three and six months ended June 30, 2024, respectively, and $ 5,656 and $ 11,382 for the three and six months ended June 30, 2023, respectively.

Based on our common share total return, as defined in our business management agreement, as of June 30, 2024 and 2023, no incentive fees are included in the business management fees we recognized for the three or six months ended June 30, 2024 or 2023.

INDUSTRIAL LOGISTICS PROPERTIES TRUST

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

Pursuant to our business management agreement with RMR, we recognized business management fees of $ 5,938 and $ 17,577 for the three and nine months ended September 30, 2024, respectively, and $ 5,919 and $ 17,301 for the three and nine months ended September 30, 2023, respectively.

Based on our common share total return, as defined in our business management agreement, as of September 30, 2024 and 2023, no incentive fees are included in the business management fees we recognized for the three or nine months ended September 30, 2024 or 2023.

The actual amount of annual incentive fees for 2024, 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, 2024, and will be payable in January 2025.

1 unchanged sentence

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 $ 3,231 and $ 6,634 for the three and six months ended June 30, 2024, respectively, and $ 3,370 and $ 6,822 for the three and six months ended June 30, 2023, respectively.

Of these amounts, for the three and six months ended June 30, 2024, $ 3,116 and $ 6,446 , respectively, were included in other operating expenses in our condensed consolidated financial statements and $ 115 and $ 188 , respectively, were capitalized as building improvements in our condensed consolidated balance sheets.

For the three and six months ended June 30, 2023, $ 3,133 and $ 6,452 , respectively, were included in other operating expenses in our condensed consolidated statements of comprehensive income (loss) and $ 237 and $ 370 , respectively, were capitalized as building improvements in our condensed consolidated balance sheets.

Pursuant to our property management agreement with RMR, we recognized aggregate property management and construction supervision fees of $ 3,317 and $ 9,951 for the three and nine months ended September 30, 2024, respectively, and $ 3,464 and $ 10,286 for the three and nine months ended September 30, 2023, respectively.

Of these amounts, for the three and nine months ended September 30, 2024, $ 3,202 and $ 9,648 , respectively, were included in other operating expenses in our condensed consolidated financial statements and $ 115 and $ 303 , respectively, were capitalized as building improvements in our condensed consolidated balance sheets.

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.

The amounts capitalized are being depreciated over the estimated useful lives of the related capital assets.

INDUSTRIAL LOGISTICS PROPERTIES TRUST

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

We are generally responsible for all of our operating expenses, including certain expenses incurred or arranged by RMR on our behalf.

1 unchanged sentence

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 $ 1,647 and $ 3,334 for these expenses and costs for the three and six months ended June 30, 2024, respectively, and $ 2,000 and $ 3,841 for the three and six months ended June 30, 2023, respectively.

We reimbursed RMR $ 1,856 and $ 5,190 for these expenses and costs for the three and nine months ended September 30, 2024, respectively, and $ 2,375 and $ 6,216 for the three and nine months ended September 30, 2023, 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).

19 unchanged sentences

Jordan, serve as managing trustees or officers of certain of these public companies.

INDUSTRIAL LOGISTICS PROPERTIES TRUST

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

Our Manager, RMR .

5 unchanged sentences

See Note 3 for further information regarding our joint ventures.

As of June 30, 2024 and December 31, 2023, we owed $ 443 and $ 680 , respectively, to the unconsolidated joint venture for rents that we collected on behalf of that joint venture.

As of September 30, 2024 and December 31, 2023, we owed $ 443 and $ 680 , 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.

For further information about these and other such relationships and certain other related person transactions, see our 2023 Annual Report.

INDUSTRIAL LOGISTICS PROPERTIES TRUST

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

Derivatives and Hedging Activities

7 unchanged sentences

See Notes 5 and 6 for further information regarding the debt our interest rate caps are related to and the fair value of our interest rate caps.

The following table summarizes the terms of our outstanding interest rate cap agreements as of June 30, 2024 and December 31, 2023:

The following table summarizes the terms of our outstanding interest rate cap agreements as of September 30, 2024 and December 31, 2023:

Sheet Underlying Maturity Strike Notional Fair Value at

Line Item Instrument Date Rate Amount June 30, 2024 December 31, 2023

Line Item Instrument Date Rate Amount September 30, 2024 December 31, 2023

Other assets ILPT Floating Rate Loan 10/15/2024

10 unchanged sentences

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.

The following table summarizes the activity related to our cash flow hedges within cumulative other comprehensive income for the periods shown:

Three Months Ended June 30, Six Months Ended June 30,

In October 2024, we exercised the first of our three , one year extension options for the maturity date of the ILPT Floating Rate Loan.

INDUSTRIAL LOGISTICS PROPERTIES TRUST

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

The following table summarizes the activity related to our cash flow hedges within cumulative other comprehensive income (loss) for the periods shown:

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

Unrealized gain on derivatives recognized in cumulative other comprehensive income $ 3,926 $ 20,025 $ 8,600 $ 16,249

Realized gain on derivatives reclassified from cumulative other comprehensive income into interest expense

Amount of (loss) gain recognized on derivative in other comprehensive income (loss)

$ ( 3,564 ) $ 3,428 $ 5,035 $ 19,677

Unrealized (loss) gain on derivatives recognized in cumulative other comprehensive income $ ( 1,510 ) $ 12,021 $ ( 6,356 ) $ 3,243

Amount of gain reclassified from cumulative other comprehensive (loss) income into interest expense

$ 5,407 $ 10,063 $ 20,363 $ 23,069

Total amount of interest expense presented in the condensed consolidated statements of comprehensive income (loss)

$ ( 73,936 ) $ ( 72,941 ) $ ( 220,797 ) $ ( 215,558 )

Tabl e of Contents

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements