What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-04-29 compared with 2025-10-28 · 78 added, 186 removed, 215 unchanged (55% of the section changed)

3 unchanged sentences

We are a real estate investment trust, or REIT, organized under Maryland law.

As of September 30, 2025, our portfolio was comprised of 411 properties containing approximately 59,890,000 rentable square feet located in 39 states with 94.1% occupancy, leased to approximately 300 different tenants, including three properties classified as held for sale.

As of September 30, 2025, we also owned a 22% equity interest in the unconsolidated joint venture.

As of March 31, 2026, our portfolio was comprised of 409 properties containing approximately 59,604,000 rentable square feet located in 39 states with 94.6% occupancy, leased to approximately 300 different tenants.

As of March 31, 2026, we also owned a 22% equity interest in the unconsolidated joint venture.

We believe consumer expectations, long-term growth of e-commerce and modernization of and demand for supply chain resiliency will keep demand for industrial properties strong for the foreseeable future.

However, uncertainties surrounding interest rates and inflation globally and in the United States, wars or other global geopolitical hostilities and tensions, the impacts of or changes to tariffs and trade policies and any U.S.

government shutdown, have given rise to economic uncertainty and have caused, and may continue to cause, disruptions in the financial markets.

For example, there have been significant changes to U.S.

and foreign trade policies, treaties and tariffs, which have led to, and may continue to cause, the disruption of global supply chains, additional or increased tariffs and other import-export barriers, sudden fluctuations in commodity prices and costs, greater political instability and the implementation of sanctions and heightened cybersecurity concerns, any or all of which may create long-term macroeconomic challenges, limit liquidity opportunities or lead to higher costs, for us and our tenants.

These conditions, if continued, could adversely affect our financial condition and that of our tenants, could adversely impact the ability or willingness of our tenants to renew our leases or pay rent to us, may restrict our access to, and would likely increase our cost of, capital, may impact our ability to sell properties and may cause the values of our properties and of our common shares or other securities to decline.

Our portfolio as of September 30, 2025 is summarized below (square feet in thousands):

This continued demand has contributed to favorable market conditions, resulting in positive mark-to-market rents on our lease renewals and new leases.

Currently, there are uncertainties in global and U.S.

economic conditions driven by fluctuations in interest rates and inflation, wars and other geopolitical hostilities and tensions and changes in trade policies and tariffs, all of which have impacted financial markets and supply chains.

While these factors have not had a significant adverse impact on our results of operations, if continued or if they worsen, they could adversely affect our financial condition primarily through our tenants’ financial stability, including their ability or willingness to renew leases, including at increased rental rates, or satisfy lease obligations.

Most of our leases require our tenants to be responsible for certain operating expenses, including real estate taxes, insurance and common area maintenance, thereby reducing our exposure to increases in operating expenses resulting from inflation or other factors.

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

% of Weighted

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ILPT 100% 88 33 states 21,833 95.7% 34.1% 5.5

22,119 94.8% 33.9% 4.8

Hawaii Properties ILPT 100% 226 Hawaii

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Total / weighted average 409 59,604 94.6% 100.0% 7.4

(1) Based on annualized rental revenues as of September 30, 2025.

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

Property Operations

Occupancy data for our portfolio as of September 30, 2025 and 2024 were as follows (square feet in thousands):

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

All Properties Comparable Properties (1)

As of September 30,

as of September 30,

as of March 31,

2026 2025 2026 2025

3 unchanged sentences

94.6 % 94.6 % 94.6 % 94.8 %

(1) Consists of properties that we have owned continuously since January 1, 2024 and excludes three properties classified as held for sale as of September 30, 2025.

(2) Leased square feet is pursuant to existing leases as of September 30, 2025, and includes space being fitted out for occupancy, if any, and space which is leased but is not occupied, if any.

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

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

The average effective rental rates per square foot represents total rental income divided by the average rentable square feet leased during the periods specified for our properties.

For the three and nine months ended September 30, 2025 and 2024, the average effective rental rates per square foot of our properties were as follows:

Three Months Ended September 30,

Nine Months Ended September 30,

2025 2024 2025 2024

For the three months ended March 31, 2026 and 2025, the average effective rental rates per square foot of our properties were as follows:

Three Months Ended March 31,

All properties $ 8.26 $ 7.92

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$ 8.26 $ 7.93

(1) For the three months ended September 30, 2025 and 2024, consists of properties that we have owned continuously since July 1, 2024 and excludes three properties classified as held for sale as of September 30, 2025.

(2) For the nine months ended September 30, 2025 and 2024, consists of properties that we have owned continuously since January 1, 2024 and excludes three properties classified as held for sale as of September 30, 2025.

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

Mainland Properties.

We g enerally will seek to renew or extend the terms of leases for our Mainland Properties as their expirations approach.

We generally will seek to renew or extend the terms of leases for our Mainland Properties as their expirations approach.

A majority of the leases for our Mainland Properties include periodic set dollar amount or percentage increases that increase the cash rent payable to us.

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Certain of our Hawaii Properties are lands leased for rents that periodically reset based on fair market values, generally every 10 years.

During the three and nine months ended September 30, 2025, we entered into new and renewal leases as summarized in the following table, excluding the impact of rent resets (square feet in thousands):

Three Months Ended September 30, 2025

New Leases Renewals Totals

Square feet leased during the period 193 583 776

Weighted average rental rate change (by rentable square feet) 14.0 % 25.8 % 22.1 %

Weighted average lease term by square feet (years) 9.7 7.1 7.8

Total leasing costs and concession commitments (1)

$ 2,339 $ 934 $ 3,273

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

$ 12.15 $ 1.60 $ 4.22

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

$ 1.26 $ 0.22 $ 0.54

Nine Months Ended September 30, 2025

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

Three Months Ended March 31, 2026

New Leases Renewals Totals

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

During the nine months ended September 30, 2025, we completed rent resets for approximately 204,000 square feet of land at our Hawaii Properties at rental rates that were 29.1% higher than prior rental rates.

The following table provides the annualized rental revenues scheduled to reset at our Hawaii Properties as of September 30, 2025:

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

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

Rental Revenues

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Total $ 22,528

As of September 30, 2025, our remaining lease expirations by year were as follows (square feet in thousands):

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

% of Total Cumulative

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Revenues Revenues Rental Revenues

Leases Expiring (1)

Year Leases Expiring (1)

Expiring Expiring Expiring

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Weighted average remaining lease term (years)

(1) Leased square feet is pursuant to existing leases as of September 30, 2025, and includes space being fitted out for occupancy, if any, and space which is leased but is not occupied, if any.

As of September 30, 2025, FedEx and Amazon leased 22.7% and 8.1% of our total leased square feet, respectively, and represented 28.3% and 6.8% of our total annualized rental revenues, respectively.

As of September 30, 2025, $17,435, or 4.0%, of our annualized rental revenues was included in leases scheduled to expire by September 30, 2026 and 5.9% of our rentable square feet was vacant.

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

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

As of March 31, 2026, $16,556, or 3.7%, of our annualized rental revenues were included in leases scheduled to expire by March 31, 2027 and 5.4% of our rentable square feet were vacant.

Rental rates for which available space may be leased in the future will depend on prevailing market conditions when lease extensions, lease renewals or new leases are negotiated.

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RESULTS OF OPERATIONS

Three Months Ended September 30, 2025 Compared to Three Months Ended September 30, 2024 (dollars and share amounts in thousands, except per share data)

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

Comparable (1)

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Three Months Ended

September 30,

2026 2025 Change Change 2026 2025 Change 2026 2025 Change Change

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General and administrative 9,464 8,238 1,226 14.9%

Loss on impairment of real estate 6,081 — 6,081 n/m

Total other expenses 50,265 49,756 509 1.0%

Interest and other income

1,585 3,134 (1,549) (49.4)%

Interest income 1,044 1,968 (924) (47.0)%

Interest expense (61,702) (69,813) 8,111 (11.6)%

Loss before income taxes and equity in earnings of unconsolidated joint venture (20,616) (30,099) 9,483 31.5%

(32,636) (36,535) 3,899 10.7%

Income tax expense (114) (28) (86) (307.1)%

Equity in earnings of unconsolidated joint venture

2,236 1,161 1,075 92.6%

Equity in earnings (losses) of unconsolidated joint venture 2,871 (1,042) 3,913 375.5%

Net loss (17,859) (31,169) 13,310 42.7%

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Net loss per share attributable to common shareholders (basic and diluted) $ (0.14) $ (0.33) $ 0.19 57.6%

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(1) Consists of properties that we have owned continuously since July 1, 2024 and excludes three properties classified as held for sale as of September 30, 2025.

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

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

References to changes in the income and expense categories below relate to the comparison of results for the three months ended September 30, 2025 compared to the three months ended September 30, 2024.

Rental income.

Rental income increased primarily due to increases from our net leasing activity and rent resets.

Real estate taxes .

Real estate taxes decreased primarily due to lowered assessed values as a result of successful tax appeals at certain of our properties.

Other operating expenses .

The decrease in other operating expenses is primarily due to decreases in payroll costs reimbursable to RMR and professional fees, partially offset by increases in electricity expenses at certain of our properties.

Depreciation and amortization.

The decrease in depreciation and amortization primarily reflects the impact of certain acquired real estate leases fully amortizing since October 1, 2024, partially offset by increased depreciation related to improvements made to certain of our properties since October 1, 2024.

General and administrative.

The increase in general and administrative expenses is primarily due to accrued incentive management fees of $2,438 at September 30, 2025.

Additionally, franchise taxes and legal costs, as well as general and administrative expenses paid in common shares increased during the three months ended September 30, 2025.

Loss on impairment of real estate.

During the 2025 period, we recognized a loss on impairment of real estate of $6,081 to reduce the carrying value of one held for sale property to its fair value less estimated costs to sell.

Interest and other income.

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

Interest expense.

The decrease in interest expense is primarily due to the repayment of the ILPT Floating Rate Loan in June 2025 and the discontinuation of hedge accounting for the related interest rate cap.

As a result, no further amortization of the related interest rate cap was recognized during the 2025 period.

Additionally, amortization of interest rate cap costs of our consolidated joint venture and debt issuance costs decreased during the 2025 period.

Income tax expense.

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

Equity in earnings of unconsolidated joint venture.

Equity in earnings of unconsolidated joint venture represents the change in the fair value of our investment in the unconsolidated joint venture.

Nine Months Ended September 30, 2025 Compared to Nine Months Ended September 30, 2024 (dollars and share amounts in thousands, except per share data)

Comparable (1)

Non-Comparable

Properties Results Properties Results Consolidated Properties Results

Nine Months Ended Nine Months Ended Nine Months Ended

September 30,

2025 2024 Change Change 2025 2024 Change 2025 2024 Change Change

Rental income $ 331,744 $ 328,856 $ 2,888 0.9% $ 3,194 $ 2,945 $ 249 $ 334,938 $ 331,801 $ 3,137 0.9%

Operating expenses:

Real estate taxes 44,832 46,169 (1,337) (2.9)% 189 180 9 45,021 46,349 (1,328) (2.9)%

Other operating expenses 27,369 27,893 (524) (1.9)% 539 533 6 27,908 28,426 (518) (1.8)%

Total operating expenses 72,201 74,062 (1,861) (2.5)% 728 713 15 72,929 74,775 (1,846) (2.5)%

Net operating income (2)

$ 259,543 $ 254,794 $ 4,749 1.9% $ 2,466 $ 2,232 $ 234 262,009 257,026 4,983 1.9%

Other expenses:

Depreciation and amortization 123,995 130,203 (6,208) (4.8)%

General and administrative 28,486 22,865 5,621 24.6%

Loss on impairment of real estate 6,081 — 6,081 n/m

Total other expenses 158,562 153,068 5,494 3.6%

Interest and other income

5,577 8,921 (3,344) (37.5)%

Interest expense (201,197) (220,797) 19,600 (8.9)%

Loss on extinguishment of debt

(5,070) — (5,070) n/m

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

(97,243) (107,918) 10,675 (9.9)%

Income tax expense (89) (102) 13 (12.7)%

Equity in earnings of unconsolidated joint venture

5,338 5,232 106 2.0%

Net loss (91,994) (102,788) 10,794 (10.5)%

Net loss attributable to noncontrolling interests

27,587 31,220 (3,633) (11.6)%

Net loss attributable to common shareholders $ (64,407) $ (71,568) $ 7,161 (10.0)%

Weighted average common shares outstanding (basic and diluted) 65,951 65,651 300 0.5%

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

$ (0.98) $ (1.09) $ 0.11 (10.1)%

n/m - not meaningful

(1) Consists of properties that we have owned continuously since January 1, 2024 and excludes three properties classified as held for sale as of September 30, 2025.

(2) See our definition of NOI and our reconciliation of net loss to NOI below under the heading “Non-GAAP Financial Measures”.

References to changes in the income and expense categories below relate to the comparison of results for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024.

References to changes in the income and expense categories below relate to the comparison of results for the three months ended March 31, 2026 compared to the three months ended March 31, 2025.

Rental income.

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

Rental income increased primarily due to increases from our net leasing activity and increases in real estate tax reimbursements at certain of our properties.

Real estate taxes.

Real estate taxes decreased primarily due to lowered assessed values as a result of successful tax appeals at certain of our properties.

Real estate taxes increased primarily due to a refund received during the three months ended March 31, 2025 as a result of a successful real estate tax appeal at one of our Mainland Properties and higher tax rates at certain of our properties during the three months ended March 31, 2026.

Other operating expenses .

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

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

Depreciation and amortization.

The decrease in depreciation and amortization primarily reflects the impact of certain acquired real estate leases fully amortizing and the disposition of two properties since April 1, 2025, partially offset by increased depreciation related to improvements made to certain of our properties since April 1, 2025.

General and administrative.

The increase in general and administrative expenses is primarily due to accrued incentive management fees of $4,716 for the 2025 period and an increase in legal fees.

Loss on impairment of real estate.

During the 2025 period, we recognized a loss on impairment of real estate of $6,081 to reduce the carrying value of one held for sale property to its fair value less estimated costs to sell.

Interest and other income.

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

The increase in general and administrative expenses is primarily due to increases in accrued incentive management fees, legal costs and trustee share award expense during the three months ended March 31, 2026 compared to the three months ended March 31, 2025.

Interest income.

The decrease in interest income is primarily due to lower cash balances and lower interest rates during the 2026 period as compared to the 2025 period.

Interest expense.

1 unchanged sentence

As a result, no further amortization of the related interest rate cap was recognized during the 2026 period.

Additionally, amortization of interest rate cap costs of our consolidated joint venture and debt issuance costs decreased during the 2025 period.

These decreases were partially offset by higher average strike rates on our interest rate cap designated as a cash flow hedge compared to the 2024 period.

Loss on extinguishment of debt .

During the nine months ended September 30, 2025, we recognized a loss on extinguishment of debt in connection with the repayment of the ILPT Floating Rate Loan.

Additionally, amortization of interest rate cap costs of our consolidated joint venture decreased during the 2026 period.

Income tax expense.

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

Equity in earnings of unconsolidated joint venture.

Equity in earnings of unconsolidated joint venture represents the change in the fair value of our investment in the unconsolidated joint venture.

Equity in earnings (losses) of unconsolidated joint venture.

Equity in earnings (losses) of unconsolidated joint venture represents the change in the fair value of our investment in the unconsolidated joint venture.

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

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Other real estate companies and REITs may calculate NOI differently than we do.

The following table presents the reconciliation of net loss to NOI for the three and nine months ended September 30, 2025 and 2024:

Three Months Ended Nine Months Ended

September 30,

2025 2024 2025 2024

The following table presents the reconciliation of net loss to NOI for the three months ended March 31, 2026 and 2025:

Three Months Ended

Net loss $ (17,859) $ (31,169)

Equity in earnings of unconsolidated joint venture

(2,236) (1,161) (5,338) (5,232)

Equity in (earnings) losses of unconsolidated joint venture (2,871) 1,042

Income tax expense 114 28

Loss before income taxes and equity in earnings of unconsolidated joint venture (20,616) (30,099)

(32,636) (36,535) (97,243) (107,918)

Loss on extinguishment of debt

Interest expense 61,702 69,813

Interest and other income

(1,585) (3,134) (5,577) (8,921)

Loss on impairment of real estate 6,081 — 6,081 —

Interest income (1,044) (1,968)

General and administrative 9,464 8,238

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FFO attributable to common shareholders and Normalized FFO attributable to common shareholders are among the factors considered by our Board of Trustees when determining the amount of distributions to our shareholders.

Other factors include, but are not limited to, requirements to maintain our qualification for taxation as a REIT, the then current and expected needs for and availability of cash to pay our obligations and fund our investments, limitations in the agreements governing our debt, the availability to us of debt and equity capital, our distribution rate as a percentage of the trading price of our common shares, or dividend yield, and our dividend yield compared to the dividend yields of other REITs and our expectation of future capital requirements and operating performance.

Other factors include, but are not limited to, requirements to maintain our qualification for taxation as a REIT, the then current and expected needs for and availability of cash to pay our obligations and fund our investments, limitations in our debt agreements, the availability to us of debt and equity capital, our distribution rate as a percentage of the trading price of our common shares, or dividend yield, and our dividend yield compared to the dividend yields of other REITs and our expectation of future capital requirements and operating performance.

Other real estate companies and REITs may calculate FFO attributable to common shareholders and Normalized FFO attributable to common shareholders differently than we do.

The following table presents our calculation of FFO attributable to common shareholders and Normalized FFO attributable to common shareholders and reconciliations of net loss attributable to common shareholders to FFO attributable to common shareholders and Normalized FFO attributable to common shareholders for the three and nine months ended September 30, 2025 and 2024:

Three Months Ended Nine Months Ended

September 30,

2025 2024 2025 2024

Three Months Ended

Net loss attributable to common shareholders $ (9,427) $ (21,532)

Equity in earnings of unconsolidated joint venture

(2,236) (1,161) (5,338) (5,232)

Loss on impairment of real estate 6,081 — 6,081 —

Equity in (earnings) losses of unconsolidated joint venture (2,871) 1,042

Depreciation and amortization 40,801 41,518

4 unchanged sentences

Incentive management fees (1)

2,438 — 4,716 —

Loss on extinguishment of debt

Normalized FFO attributable to common shareholders $ 21,983 $ 13,490

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(1) Incentive management fees are estimated and accrued during the applicable measurement period.

Actual incentive management fees will be calculated based on common share total return, as defined in our business management agreement, for the three year period ending December 31 of the applicable calendar year, are included in general and administrative expenses in our condensed consolidated statements of comprehensive income (loss) and will be payable to RMR in January of the following calendar year.

Actual incentive management fees are calculated based on common share total return, as defined in our business management agreement, for the three year period ending December 31 of the applicable calendar year, are included in general and administrative expenses in our condensed consolidated statements of comprehensive income (loss) and are payable to RMR in January of the following calendar year.

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

Our principal sources of funds to meet our operating and capital obligations, pay our debt service obligations and make distributions to our shareholders are rents from tenants at our properties.

As of September 30, 2025, investment grade rated tenants, subsidiaries of investment grade rated parent entities or our Hawaii land leases represented 76.2% of our annualized rental revenues and only 4.0% of our annualized rental revenues were from leases expiring over the next 12 months.

As of March 31, 2026, investment grade rated tenants, subsidiaries of investment grade rated entities or our Hawaii land leases represented 76.9% of our annualized rental revenues and only 3.7% of our annualized rental revenues were from leases expiring over the next 12 months.

We believe that these sources of funds will be sufficient to meet our operating and capital obligations, pay our debt service obligations and make distributions to our shareholders for the next 12 months and for the foreseeable future thereafter.

The following is a summary of our sources and uses of cash flows for the periods presented, as reflected in our condensed consolidated statements of cash flows:

Nine Months Ended September 30,

Three Months Ended March 31,

Cash and cash equivalents and restricted cash and cash equivalents at beginning of period $ 183,031 $ 242,480

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Cash and cash equivalents and restricted cash and cash equivalents at end of period $ 185,790 $ 236,702

The increase in net cash from operating activities for the nine months ended September 30, 2025 compared to the 2024 period is primarily due to lower interest expense, excluding the impact of settlement of our interest rate caps, and higher cash flows and reimbursements from our properties.

The decrease in net cash from investing activities for the nine months ended September 30, 2025 compared to the 2024 period is primarily due to a decrease in proceeds from settlement of interest rate caps and an increase in real estate improvements, partially offset by reduced interest rate cap purchase costs.

The decrease in net cash from financing activities for the nine months ended September 30, 2025 compared to the 2024 period is primarily due to the repayment of the ILPT Floating Rate Loan and increases in debt issuance costs and distributions to common shareholders, partially offset by the net proceeds received from our $1,160,000 mortgage loan.

The increase in net cash from operating activities for the three months ended March 31, 2026 compared to the 2025 period is primarily due to higher cash flows and reimbursements from our properties and lower interest expense, excluding the impact of settlement of our interest rate caps.

The decrease in net cash used in investing activities for the three months ended March 31, 2026 compared to the 2025 period is primarily due to reduced interest rate cap purchase costs and real estate improvements in 2026.

The increase in net cash used in financing activities for the three months ended March 31, 2026 compared to the 2025 period is due to increases in distributions to common shareholders in 2026.

Our Operating Liquidity and Resources

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

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

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

Our Investing and Financing Liquidity and Resources

As of September 30, 2025, we had cash and cash equivalents, excluding restricted cash and cash equivalents, of $83,173.

As of March 31, 2026, we had cash and cash equivalents, excluding restricted cash and cash equivalents, of $99,500.

To maintain our qualification for taxation as a REIT under the Internal Revenue Code of 1986, as amended, we generally are required to distribute at least 90% of our REIT taxable income annually, subject to specified adjustments and excluding any net capital gain.

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As our debt approaches maturity or we desire to reduce our leverage or refinance debt, we may explore refinancing alternatives, property sales or sales of equity interests in joint ventures.

Such alternatives may include incurring term debt, obtaining financing secured by mortgages on properties we own, issuing new equity or debt securities, obtaining a revolving credit facility, participating or selling equity interests in joint ventures or selling properties.

Such alternatives may include incurring term debt, obtaining financing secured by mortgages on properties we own, issuing new equity or debt securities or obtaining a revolving credit facility.

We may also assume mortgage loans or incur debt in connection with future acquisitions, developments and redevelopments.

Although we cannot be sure that we will be successful in completing any particular type of financing, we believe that we will have access to financing, such as debt or equity offerings, to fund capital expenditures, future acquisitions, development, redevelopment and other activities and to pay our obligations.

Disposition Activities

As of October 28, 2025, we had two properties under agreements or letters of intent to sell for an aggregate sales price of $51,650, excluding closing costs.

We may not complete the sales of any or all of the properties we currently plan to sell.

Also, we may sell some or all of these properties at amounts that are less than currently expected and/or less than the carrying values of such properties and we may incur losses on any such sales as a result.

For further information regarding our held for sale properties and disposition activities, see Note 3 to our condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

Capital Expenditures

As of September 30, 2025, committed, but unspent, tenant related obligations based on existing leases were $4,988, all of which are expected to be spent during the next 12 months.

As of March 31, 2026, committed, but unspent, tenant related obligations based on existing leases were $4,868, of which $3,900 is expected to be spent during the next 12 months.

For further information regarding our capital expenditures, see Note 3 to our condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

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We account for the unconsolidated joint venture using the equity method of accounting under the fair value option.

The unconsolidated joint venture made aggregate cash distributions to us of $990 for each of the three months ended September 30, 2025 and 2024, and $2,970 for each of the nine months ended September 30, 2025 and 2024, respectively.

The unconsolidated joint venture made aggregate cash distributions to us of $1,188 and $990 for the three months ended March 31, 2026 and 2025, respectively.

For further information regarding our consolidated joint venture and the unconsolidated joint venture, see Note 3 to our condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

As of September 30, 2025, we had an aggregate principal amount of $4,218,799 of indebtedness, primarily including (1) our $1,160,000 mortgage loan, (2) the Mountain Floating Rate Loan, (3) our $700,000 mortgage loan and (4) our $650,000 mortgage loan, with maturity dates after giving effect to potential exercises of all extension options between 2027 and 2038.

As of March 31, 2026, we had an aggregate principal amount of $4,209,229 of indebtedness, primarily including:

(1) our $1,160,000 mortgage loan;

(2) the Mountain Floating Rate Loan;

(3) our $700,000 mortgage loan;

(4) our $650,000 mortgage loan;

(5) our consolidated joint venture’s $91,000 mortgage loan;

and (6) $208,229 of our consolidated joint venture’s amortizing mortgage loans, with maturity dates between 2027 and 2038.

In June 2025, we obtained a $1,160,000 fixed rate, interest only mortgage loan secured by 101 of our properties.

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We used the net proceeds from our $1,160,000 mortgage loan and cash on hand to repay in full the ILPT Floating Rate Loan.

The ILPT Floating Rate Loan was secured by 104 of our properties, was scheduled to mature in October 2025 and required that interest be paid at an annual rate of SOFR plus a weighted average premium of 3.93%.

During the nine months ended September 30, 2025, we recognized a $5,070 loss on extinguishment of debt related to the repayment of the ILPT Floating Rate Loan.

The Mountain Floating Rate Loan is secured by 82 properties, matures in March 2026, subject to one remaining one-year extension option, and requires that interest be paid at an annual rate of SOFR plus a premium of 2.77%.

In March 2025, our consolidated joint venture exercised the second of its three, one-year extension options for the maturity date of this loan.

The Mountain Floating Rate Loan is secured by 82 properties, matures in March 2027 and requires that interest be paid at an annual rate of SOFR plus a weighted average premium of 2.77%.

In March 2026, our consolidated joint venture exercised the third of its three, one-year extension options for the maturity date of this loan.

In connection with the exercise of the extension, our consolidated joint venture purchased a one-year interest rate cap for $3,720 with a SOFR strike rate equal to 3.29%, which replaced the previous interest rate cap with a SOFR strike rate equal to 3.10%.

Subject to the satisfaction of certain conditions, our consolidated joint venture has the option to prepay the Mountain Floating Rate Loan in full or in part at any time at par with no premium.

The weighted average interest rates under the Mountain Floating Rate Loan were 5.87% and 5.85% for three and nine months ended September 30, 2025, respectively, including the impact of our interest rate caps.

The weighted average interest rates under the Mountain Floating Rate Loan were 5.90% and 5.82% for three months ended March 31, 2026 and 2025, respectively, including the impact of our interest rate caps.

In April 2026, our consolidated joint venture priced a $1,620,000 five year, fixed rate, interest only mortgage loan to be secured by 90 of its properties.

This mortgage loan is expected to close on or about May 8, 2026 and our consolidated joint venture expects to use the net proceeds from this mortgage loan to repay in full the Mountain Floating Rate Loan and $204,999 of its amortizing fixed rate debt secured by eight properties.

The agreements and related documents governing our $1,160,000 mortgage loan, the Mountain Floating Rate Loan, our $700,000 mortgage loan and our $650,000 mortgage loan contain customary covenants, provide for acceleration of payment of all amounts due thereunder upon the occurrence and continuation of certain events of default and, in the case of the $650,000 mortgage loan, also require us to maintain a minimum consolidated net worth of at least $250,000 and liquidity of at least $15,000.

As of September 30, 2025, we believe that we were in compliance with all of the covenants and other terms under the agreements governing these loans.

For further information regarding our indebtedness and historical weighted average interest rates under our floating rate loans, see Notes 5 and 6 to our condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

As of March 31, 2026, we believe that we were in compliance with all of the covenants and other terms under the agreements governing these loans.

For further information regarding our indebtedness and historical weighted average interest rates of our floating rate loans, see Notes 5 and 6 to our condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

Distributions

During the nine months ended September 30, 2025, we declared and paid regular quarterly distributions to common shareholders totaling $4,640 using cash on hand.

On October 9, 2025, we declared a regular quarterly distribution to common shareholders of record on October 27, 2025 of $0.05 per share, or approximately $3,333.

We expect to pay this distribution on or about November 13, 2025 using cash on hand.

During the three months ended March 31, 2026, we declared and paid a regular quarterly distribution to common shareholders totaling $3,333 using cash on hand.

On April 9, 2026, we declared a regular quarterly distribution to common shareholders of record on April 21, 2026 of $0.05 per share, or approximately $3,333.

We expect to pay this distribution on or about May 14, 2026 using cash on hand.

Related Person Transactions

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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 2. Management’s Discussion and Analysis