OFFICE PROPERTIES INCOME TRUST 10-K

Item 9A. Controls and Procedures As of the end of the period covered by this Annual Report on Form 10-K, our management carried out an evaluation, under the supervision and with the participation of our Managing Trustees, our President and Chief Operating Officer and our Chief Financial Officer and Treasurer, of the effectiveness of our disclosure controls and procedures pursuant to Rules 13a-15 and 15d-15 under the Exchange Act. Based upon that evaluation, our Managing Trustees, our President and Chief Operating Officer and our Chief Financial Officer and Treasurer concluded that our disclosure controls and procedures are effective. There have been no changes in our internal control over financial reporting during the quarter ended December 31, 2020 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Management Report on Assessment of Internal Control Over Financial Reporting We are responsible for establishing and maintaining adequate internal control over financial reporting. Our internal control system is designed to provide reasonable assurance to our management and Board of Trustees regarding the preparation and fair presentation of published financial statements. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Our management assessed the effectiveness of our internal control over financial reporting as of December 31, 2020. In making this assessment, it used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) in Internal Control—Integrated Framework . Based on this assessment, we believe that, as of December 31, 2020, our internal control over financial reporting is effective. Deloitte & Touche LLP, the independent registered public accounting firm that audited our 2020 Consolidated Financial Statements included in Part IV, Item 15 of this Annual Report on Form 10-K, has issued an attestation report on our internal control over financial reporting. Its report appears elsewhere herein. Item 9B. Other Information None. 68 Table of Contents PART III Item 10. Directors, Executive Officers and Corporate Governance We have a Code of Conduct that applies to our officers and Trustees, RMR Inc. and RMR LLC, senior level officers of RMR LLC, senior level officers and directors of RMR Inc. and certain other officers and employees of RMR LLC. Our Code of Conduct is posted on our website, www.opireit.com. A printed copy of our Code of Conduct is also available free of charge to any person who requests a copy by writing to our Secretary, Office Properties Income Trust, Two Newton Place, 255 Washington Street, Suite 300, Newton, MA 02458-1634. We intend to satisfy the requirements under Item 5.05 of Form 8-K regarding disclosure of any amendments to, or waivers from, our Code of Conduct that apply to our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, on our website. The remainder of the information required by Item 10 is incorporated by reference to our definitive Proxy Statement. Item 11. Executive Compensation The information required by Item 11 is incorporated by reference to our definitive Proxy Statement. Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters Equity Compensation Plan Information. We may grant common shares to our officers and other employees of RMR LLC under our Amended and Restated 2009 Incentive Share Award Plan, or the 2009 Plan. In addition, each of our Trustees receives common shares as part of his or her annual compensation for serving as a Trustee and such shares are awarded under the 2009 Plan. The terms of awards made under the 2009 Plan are determined by the Compensation Committee of our Board of Trustees, at the time of the awards. The following table is as of December 31, 2020. Plan Category Number of securities to be issued upon exercise of outstanding options, warrants and rights Weighted-average exercise price of outstanding options, warrants and rights Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (a) (b) (c) Equity compensation plans approved by securityholders — 2009 Plan None. None. 1,094,909 (1) Equity compensation plans not approved by securityholders None. None. None. Total None. None. 1,094,909 (1) (1) Consists of common shares available for issuance pursuant to the terms of the 2009 Plan. Share awards that are repurchased or forfeited will be added to the common shares available for issuance under the 2009 Plan. Our shareholders approved an amendment to the 2009 Plan at our annual meeting of shareholders held on May 27, 2020 to increase the total number of common shares available for grant by 1,000,000. Payments by us to RMR LLC employees are described in Notes 6 and 10 to the Notes to Consolidated Financial Statements included in Part IV, Item 15 of this Annual Report on Form 10-K. The remainder of the information required by Item 12 is incorporated by reference to our definitive Proxy Statement. Item 13. Certain Relationships and Related Transactions, and Director Independence The information required by Item 13 is incorporated by reference to our definitive Proxy Statement. Item 14. Principal Accountant Fees and Services The information required by Item 14 is incorporated by reference to our definitive Proxy Statement. 69 Table of Contents PART IV Item 15. Exhibits and Financial Statement Schedules (a) Index to Financial Statements and Financial Statement Schedules The following consolidated financial statements and financial statement schedule of Office Properties Income Trust are included on the pages indicated: Reports of Independent Registered Public Accounting Firm F-1 Report of Independent Registered Public Accounting Firm F-4 Consolidated Balance Sheets as of December 31, 2020 and 2019 F -5 Consolidated Statements of Comprehensive Income (Loss) for each of the three years in the period ended December 31, 2020 F-6 Consolidated Statements of Shareholders’ Equity for each of the three years in the period ended December 31, 2020 F-7 Consolidated Statements of Cash Flows for each of the three years in the period ended December 31, 2020 F-8 Notes to Consolidated Financial Statements F-10 Schedule III — Real Estate and Accumulated Depreciation S-1 All other schedules for which provision is made in the applicable accounting regulations of the SEC are not required under the related instructions, or are inapplicable, and therefore have been omitted. (b) Exhibits Exhibit Number Description 3.1 Composite Copy of Amended and Restated Declaration of Trust, dated June 8, 2009, as amended to date. (Incorporated by reference to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2020.) 3.2 Amended and Restated Bylaws of the Company, adopted March 27, 2019. (Incorporated by reference to the Company’s Current Report on Form 8-K filed on March 28, 2019.) 4.1 Form of Common Share Certificate. (Incorporated by reference to the Company's Annual Report on Form 10-K for the year ended December 31, 2018 .) 4.2 Indenture, dated as of August 18, 2014, between the Company and U.S. Bank National Association. (Incorporated by reference to the Company’s Current Report on Form 8-K filed on August 18, 2014.) 4.3 Supplemental Indenture No. 2, dated as of May 26, 2016, between the Company and U.S. Bank National Association, relating to the Company’s 5.875% Senior Notes due 2046, including form thereof. (Incorporated by reference to the Company’s Current Report on Form 8-K filed on May 26, 2016.) 4.4 Authentication Order, dated as of June 22, 2016, from the Company to U.S. Bank National Association, relating to the Company’s 5.875% Senior Notes due 2046. (Incorporated by reference to the Company’s Registration Statement on Form 8-A filed on June 30, 2016.) 4.5 Indenture, dated as of July 20, 2017, between the Company and U.S. Bank National Association. (Incorporated by reference to the Company’s Current Report on Form 8-K filed on July 21, 2017.) 4.6 First Supplemental Indenture, dated as of July 20, 2017, between the Company and U.S. Bank National Association, relating to the Company’s 4.000% Senior Notes due 2022, including form thereof. (Incorporated by reference to the Company’s Current Report on Form 8-K filed on July 21, 2017.) 4.7 Second Supplemental Indenture, dated as of June 23, 2020, between the Company and U.S. Bank National Association, relating to the Company’s 6.375% Senior Notes due 2050, including form thereof. (Incorporated by reference to the Company’s Registration Statement on Form 8-A filed on June 23, 2020.) 4.8 Indenture, dated as of February 3, 2015, between the Company (as successor to Select Income REIT) and U.S. Bank National Association. (Incorporated by reference to Select Income REIT’s Current Report on Form 8-K filed on February 3, 2015.) 70 Table of Contents 4.9 First Supplemental Indenture, dated as of February 3, 2015, between the Company (as successor to Select Income REIT) and U.S. Bank National Association, including the forms of 4.15% Senior Notes due 2022 and 4.50% Senior Notes due 2025. (Incorporated by reference to Select Income REIT’s Current Report on Form 8-K filed on February 3, 2015.) 4.10 Second Supplemental Indenture, dated as of May 15, 2017, between the Company (as successor to Select Income REIT) and U.S. Bank National Association, including the form of 4.250% Senior Notes due 2024. (Incorporated by reference to Select Income REIT’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2017, filed by Select Income REIT on July 25, 2017.) 4.11 Third Supplemental Indenture, dated as of December 31, 2018, among Select Income REIT, the Company and U.S. Bank National Association. (Incorporated by reference to the Company’s Current Report on Form 8-K filed on December 31, 2018.) 4.12 Authentication Order, dated as of September 24, 2020, from the Company to U.S. Bank National Association, relating to the Company’s 4.50% Senior Notes due 2025. (Incorporated by reference to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2020.) 4.13 Registration Rights and Lock-Up Agreement, dated as of June 5, 2015, among the Company, ABP Trust (f/k/a Reit Management & Research Trust) and Adam D. Portnoy. (Incorporated by reference to the Company’s Current Report on Form 8-K filed on June 8, 2015.) 4.14 Description of Securities. (Filed herewith.) 8.1 Opinion of Sullivan & Worcester LLP as to certain tax matters. (Filed herewith.) 10.1 Second Amended and Restated Business Management Agreement, dated as of June 5, 2015, between the Company and The RMR Group LLC (f/k/a Reit Management & Research LLC). (+) (Incorporated by reference to the Company’s Current Report on Form 8-K filed on June 8, 2015.) 10.2 Amendment to Second Amended and Restated Business Management Agreement, dated as of December 31, 2018, between the Company and The RMR Group LLC. (+) (Incorporated by reference to the Company’s Current Report on Form 8-K filed on December 31, 2018.) 10.3 Second Amended and Restated Property Management Agreement, dated as of June 5, 2015, between the Company and The RMR Group LLC. (+) (Incorporated by reference to the Company’s Current Report on Form 8-K filed on June 8, 2015.) 10.4 Amended and Restated Office Properties Income Trust 2009 Incentive Share Award Plan. (+) (Incorporated by reference to the Company's Current Report on Form 8-K filed on May 28, 2020.) 10.5 Form of Share Award Agreement. (+) (Incorporated by reference to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2016.) 10.6 Form of Share Award Agreement. (+) (Incorporated by reference to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2020.) 10.7 Form of Indemnification Agreement. (+) (Incorporated by reference to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2020.) 10.8 Summary of Trustee Compensation. (+) (Incorporated by reference to the Company’s Current Report on Form 8-K filed on May 28, 2020.) 10.9 Amended and Restated Credit Agreement, dated as of December 13, 2018, among the Company, Wells Fargo Bank, National Association, as Administrative Agent, and each of the other financial institutions initially a signatory thereto. (Incorporated by reference to the Company’s Current Report on Form 8-K filed on December 1 7 , 2018.) 21.1 Subsidiaries of the Company. (Filed herewith.) 23.1 Consent of Deloitte & Touche LLP. (Filed herewith.) 23.2 Consent of Ernst & Young LLP. (Filed herewith.) 23.3 Consent of Sullivan & Worcester LLP. (Contained in Exhibit 8.1.) 31.1 Rule 13a-14(a) Certification. (Filed herewith.) 31.2 Rule 13a-14(a) Certification. (Filed herewith.) 31.3 Rule 13a-14(a) Certification. (Filed herewith.) 31.4 Rule 13a-14(a) Certification. (Filed herewith.) 32.1 Section 1350 Certification. (Furnished herewith.) 71 Table of Contents 99.1 Letter dated as of October 2, 2017, between the Company and The RMR Group LLC, regarding Second Amended and Restated Business Management Agreement. (+) (Incorporated by reference to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2017.) 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.) (+) Management contract or compensatory plan or arrangement. Item 16. Form 10-K Summary None. 72 Table of Contents Report of Independent Registered Public Accounting Firm To the Trustees and Shareholders of Office Properties Income Trust Opinion on the Financial Statements We have audited the accompanying consolidated balance sheet of Office Properties Income Trust (the "Company") as of December 31, 2020, the related consolidated statements of comprehensive income (loss), shareholders' equity, and cash flows, for the year then ended, and the related notes and the schedule listed in the Index at Item 15(a) (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2020, and the results of its operations and its cash flows for the year ended December 31, 2020, in conformity with accounting principles generally accepted in the United States of America. We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 19, 2021, expressed an unqualified opinion on the Company's internal control over financial reporting. Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Impairment of Real Estate Properties - Refer to Notes 2 and 3 to the financial statements Critical Audit Matter Description The Company’s investments in real estate assets are evaluated for impairment periodically or when events or changes in circumstances indicate that the carrying amount of a real estate asset may not be recoverable. The Company’s evaluation of the recoverability of real estate assets involves the comparison of undiscounted future cash flows expected to be generated by each real estate asset over the Company’s estimated holding period to the respective carrying amount. The Company’s undiscounted future cash flows analysis and the assessment of expected remaining holding period requires management to make significant estimates and assumptions related to future occupancy levels, rental rates, estimated sale proceeds, and capitalization rates. In the event that a real estate asset is not recoverable, the Company will adjust the real estate asset to its fair value based on third-party appraisals, broker selling estimates, sale agreements under negotiation, and/or final selling prices, when available, and recognize an impairment loss for the carrying amount in excess of fair value. We identified the impairment of real estate assets as a critical audit matter because of the significant estimates and assumptions management makes to evaluate the recoverability of real estate assets. This required a high degree of auditor judgment and an F-1 Table of Contents increased extent of effort when performing audit procedures to evaluate the reasonableness of management’s undiscounted future cash flows analysis and assessment of expected remaining holding period. How the Critical Audit Matter Was Addressed in the Audit Our audit procedures related to the undiscounted cash flows analysis and the assessment of the expected remaining hold period included the following, among others: • We tested the effectiveness of controls over management’s evaluation of the recoverability of real estate property assets, including the key inputs utilized in estimating the undiscounted future cash flows. • We evaluated the undiscounted cash flow analysis including estimates of future occupancy levels, rental rates, estimated sale proceeds, and capitalization rates for each real estate asset or group of assets with possible impairment indicators by (1) evaluating the source information and assumptions used by management and (2) testing the mathematical accuracy of the undiscounted future cash flows analysis. • We evaluated the reasonableness of management’s undiscounted future cash flows analysis by comparing management’s projections to external market sources and evidence obtained in other areas of our audit. • We held discussions with management about the current status of potential transactions and about management’s judgments to understand the probability of future events that could affect the hold period and other cash flow assumptions for the properties. /s/ Deloitte & Touche LLP Boston, Massachusetts February 19, 2021 We have served as the Company’s auditor since 2020. F-2 Table of Contents Report of Independent Registered Public Accounting Firm To the Trustees and Shareholders of Office Properties Income Trust Opinion on Internal Control over Financial Reporting We have audited the internal control over financial reporting of Office Properties Income Trust (the “Company”) as of December 31, 2020, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO. We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, 2020, of the Company and our report dated February 19, 2021, expressed an unqualified opinion on those financial statements. Basis for Opinion The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management Report on Assessment of Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Definition and Limitations of Internal Control over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. /s/ Deloitte & Touche LLP Boston, Massachusetts February 19, 2021 F-3 Table of Contents Report of Independent Registered Public Accounting Firm To the Trustees and Shareholders of Office Properties Income Trust Opinion on the Financial Statements We have audited the accompanying consolidated balance sheet of Office Properties Income Trust (the Company) as of December 31, 2019, the related consolidated statements of comprehensive income (loss) , shareholders' equity and cash flows for each of the two years in the period ended December 31, 2019, and the related notes and the financial statement schedule listed in the Index at item 15(a) (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2019, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2019, in conformity with U.S. generally accepted accounting principles. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2019, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated February 20, 2020 expressed an unqualified opinion thereon. Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. /s/ Ernst & Young LLP We served as the Company’s auditor from 2008 to 2020. Boston, Massachusetts February 20, 2020 F-4 Table of Contents OFFICE PROPERTIES INCOME TRUST CONSOLIDATED BALANCE SHEETS (dollars in thousands, except per share data) December 31, 2020 2019 ASSETS Real estate properties: Land $ 830,884 $ 840,550 Buildings and improvements 2,691,259 2,652,681 Total real estate properties, gross 3,522,143 3,493,231 Accumulated depreciation ( 451,914 ) ( 387,656 ) Total real estate properties, net 3,070,229 3,105,575 Assets of properties held for sale 75,177 70,877 Investments in unconsolidated joint ventures 37,951 39,756 Acquired real estate leases, net 548,943 732,382 Cash and cash equivalents 42,045 93,744 Restricted cash 14,810 6,952 Rents receivable 101,766 83,556 Deferred leasing costs, net 42,626 40,107 Other assets, net 12,889 20,187 Total assets $ 3,946,436 $ 4,193,136 LIABILITIES AND SHAREHOLDERS’ EQUITY Unsecured revolving credit facility $ — $ — Senior unsecured notes, net 2,033,242 2,017,379 Mortgage notes payable, net 169,729 309,946 Liabilities of properties held for sale 891 14,693 Accounts payable and other liabilities 116,480 125,048 Due to related persons 6,114 7,141 Assumed real estate lease obligations, net 10,588 13,175 Total liabilities 2,337,044 2,487,382 Commitments and contingencies Shareholders’ equity: Common shares of beneficial interest, $ .01 par value: 200,000,000 shares authorized, 48,318,366 and 48,201,941 shares issued and outstanding, respectively 483 482 Additional paid in capital 2,615,305 2,612,425 Cumulative net income 183,895 177,217 Cumulative other comprehensive loss — ( 200 ) Cumulative common distributions ( 1,190,291 ) ( 1,084,170 ) Total shareholders’ equity 1,609,392 1,705,754 Total liabilities and shareholders’ equity $ 3,946,436 $ 4,193,136 The accompanying notes are an integral part of these consolidated financial statements. F-5 Table of Contents OFFICE PROPERTIES INCOME TRUST CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (amounts in thousands, except per share data) Year Ended December 31, 2020 2019 2018 Rental income $ 587,919 $ 678,404 $ 426,560 Expenses: Real estate taxes 65,119 73,717 49,708 Utility expenses 25,384 34,302 26,425 Other operating expenses 105,465 120,943 89,610 Depreciation and amortization 251,566 289,885 162,488 Loss on impairment of real estate 2,954 22,255 8,630 Acquisition and transaction related costs 232 682 14,508 General and administrative 28,443 32,728 24,922 Total expenses 479,163 574,512 376,291 Gain on sale of real estate 10,855 105,131 20,661 Dividend income — 1,960 1,337 Loss on equity securities, net — ( 44,007 ) ( 7,552 ) Interest and other income 779 1,045 639 Interest expense (including net amortization of debt premiums, discounts and issuance costs of $ 9,593 , $ 10,740 and $ 3,626 , respectively) ( 108,303 ) ( 134,880 ) ( 89,865 ) Loss on early extinguishment of debt ( 3,839 ) ( 769 ) ( 709 ) Income (loss) before income tax expense and equity in net losses of investees 8,248 32,372 ( 25,220 ) Income tax expense ( 377 ) ( 778 ) ( 117 ) Equity in net losses of investees ( 1,193 ) ( 1,259 ) ( 2,269 ) Income (loss) from continuing operations 6,678 30,335 ( 27,606 ) Income from discontinued operations — — 5,722 Net income (loss) 6,678 30,335 ( 21,884 ) Other comprehensive income (loss): Unrealized gain (loss) on financial instrument 200 ( 200 ) — Equity in unrealized loss of investees — ( 106 ) ( 40 ) Other comprehensive income (loss) 200 ( 306 ) ( 40 ) Comprehensive income (loss) $ 6,878 $ 30,029 $ ( 21,924 ) Net income (loss) $ 6,678 $ 30,335 $ ( 21,884 ) Preferred units of limited partnership distributions — — ( 371 ) Net income (loss) available for common shareholders $ 6,678 $ 30,335 $ ( 22,255 ) Weighted average common shares outstanding (basic and diluted) 48,124 48,062 24,830 Per common share amounts (basic and diluted): Income (loss) from continuing operations $ 0.14 $ 0.63 $ ( 1.13 ) Income from discontinued operations $ — $ — $ 0.23 Net income (loss) available for common shareholders $ 0.14 $ 0.63 $ ( 0.90 ) The accompanying notes are an integral part of these consolidated financial statements. F-6 Table of Contents OFFICE PROPERTIES INCOME TRUST CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (dollars in thousands) Number of Shares Common Shares Additional Paid In Capital Cumulative Net Income Cumulative Other Comprehensive Income (Loss) Cumulative Common Distributions Total Balance at December 31, 2017 24,786,479 $ 248 $ 1,968,960 $ 108,144 $ 60,427 $ ( 807,736 ) $ 1,330,043 Cumulative adjustment upon adoption of ASU No. 2016-01 — — — 60,281 ( 60,281 ) — — Adjustment upon adoption of ASU No. 2014-09 — — — 712 — — 712 Balance at January 1, 2018 24,786,479 248 1,968,960 169,137 146 ( 807,736 ) 1,330,755 Issuance of shares, net 23,281,738 233 639,550 — — — 639,783 Share grants 19,925 — 1,523 — — — 1,523 Share forfeitures and repurchases ( 5,239 ) — ( 232 ) — — — ( 232 ) Equity in unrealized loss of investees — — — — ( 40 ) — ( 40 ) Net loss available for common shareholders — — — ( 22,255 ) — — ( 22,255 ) Distributions to common shareholders — — — — — ( 170,566 ) ( 170,566 ) Balance at December 31, 2018 48,082,903 481 2,609,801 146,882 106 ( 978,302 ) 1,778,968 Share grants 136,100 1 3,097 — — — 3,098 Share forfeitures and repurchases ( 17,062 ) — ( 473 ) — — — ( 473 ) Amounts reclassified from cumulative other comprehensive income to net income — — — — ( 196 ) — ( 196 ) Equity in unrealized gain of investees — — — — 90 — 90 Unrealized loss on financial instrument — — — — ( 200 ) — ( 200 ) Net income available for common shareholders — — — 30,335 — — 30,335 Distributions to common shareholders — — — — — ( 105,868 ) ( 105,868 ) Balance at December 31, 2019 48,201,941 482 2,612,425 177,217 ( 200 ) ( 1,084,170 ) 1,705,754 Share grants 136,600 1 3,323 — — — 3,324 Share forfeitures and repurchases ( 20,175 ) — ( 443 ) — — — ( 443 ) Amounts reclassified from cumulative other comprehensive loss to net income — — — — 85 — 85 Unrealized gain on financial instruments — — — — 115 — 115 Net income available for common shareholders — — — 6,678 — — 6,678 Distributions to common shareholders — — — — — ( 106,121 ) ( 106,121 ) Balance at December 31, 2020 48,318,366 $ 483 $ 2,615,305 $ 183,895 $ — $ ( 1,190,291 ) $ 1,609,392 The accompanying notes are an integral part of these consolidated financial statements. F-7 Table of Contents OFFICE PROPERTIES INCOME TRUST CONSOLIDATED STATEMENTS OF CASH FLOWS (dollars in thousands) Year Ended December 31, 2020 2019 2018 CASH FLOWS FROM OPERATING ACTIVITIES: Net income (loss) $ 6,678 $ 30,335 $ ( 21,884 ) Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation 83,828 89,400 66,685 Net amortization of debt premiums, discounts and issuance costs 9,593 10,740 3,626 Amortization of acquired real estate leases 167,192 197,978 94,375 Amortization of deferred leasing costs 6,887 5,973 4,833 Gain on sale of real estate ( 10,855 ) ( 105,131 ) ( 20,661 ) Loss on impairment of real estate 2,954 22,255 8,630 Loss on early extinguishment of debt 2,701 769 709 Straight line rental income ( 16,079 ) ( 27,507 ) ( 10,164 ) Other non-cash expenses, net 2,229 2,011 250 Loss on equity securities, net — 44,007 7,552 Equity in net losses of investees 1,193 1,259 2,269 Distribution of earnings from Affiliates Insurance Company — 2,438 — Equity in earnings of Select Income REIT included in discontinued operations — — ( 20,873 ) Net gain on issuance of shares by Select Income REIT included in discontinued operations — — ( 29 ) Loss on sale of Select Income REIT shares included in discontinued operations — — 15,180 Distributions of earnings from Select Income REIT — — 20,873 Change in assets and liabilities: Rents receivable ( 3,962 ) 12,586 5,021 Deferred leasing costs ( 12,128 ) ( 27,971 ) ( 9,203 ) Other assets 2,505 3,266 1,127 Accounts payable and other liabilities ( 8,081 ) ( 19,333 ) ( 3,303 ) Due to related persons ( 1,027 ) ( 27,746 ) ( 97 ) Net cash provided by operating activities 233,628 215,329 144,916 CASH FLOWS FROM INVESTING ACTIVITIES: Real estate acquisitions ( 47,215 ) ( 2,905 ) 25,221 Real estate improvements ( 81,762 ) ( 62,676 ) ( 47,500 ) Distributions in excess of earnings from Select Income REIT — — 17,251 Distributions in excess of earnings from unconsolidated joint ventures 612 2,370 3,751 Distributions in excess of earnings from Affiliates Insurance Company 287 6,562 — Proceeds from sale of properties, net 102,211 829,794 304,808 Proceeds from sale of Select Income REIT shares — — 435,125 Proceeds from sale of The RMR Group Inc. common shares, net — 104,674 — Proceeds from repayment of mortgage note receivable 2,880 — — Net cash (used in) provided by investing activities ( 22,987 ) 877,819 738,656 The accompanying notes are an integral part of these consolidated financial statements. F-8 Table of Contents OFFICE PROPERTIES INCOME TRUST CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued) (dollars in thousands) Year Ended December 31, 2020 2019 2018 CASH FLOWS FROM FINANCING ACTIVITIES: Repayment of mortgage notes payable ( 155,367 ) ( 12,054 ) ( 3,708 ) Repayment of unsecured term loans — ( 388,000 ) ( 162,000 ) Repayment of senior unsecured notes ( 400,000 ) ( 350,000 ) — Proceeds from issuance of senior unsecured notes, net 408,932 — — Borrowings on unsecured revolving credit facility 561,467 430,000 238,000 Repayments on unsecured revolving credit facility ( 561,467 ) ( 605,000 ) ( 741,000 ) Payment of debt issuance costs ( 1,492 ) — ( 3,936 ) Repurchase of common shares ( 434 ) ( 473 ) ( 232 ) Redemption of preferred units of limited partnership — — ( 20,221 ) Preferred units of limited partnership distributions — — ( 646 ) Distributions to common shareholders ( 106,121 ) ( 105,868 ) ( 170,566 ) Net cash used in financing activities ( 254,482 ) ( 1,031,395 ) ( 864,309 ) (Decrease) increase in cash, cash equivalents and restricted cash ( 43,841 ) 61,753 19,263 Cash, cash equivalents and restricted cash at beginning of period 100,696 38,943 19,680 Cash, cash equivalents and restricted cash at end of period $ 56,855 $ 100,696 $ 38,943 SUPPLEMENTAL CASH FLOW INFORMATION: Interest paid $ 100,083 $ 131,735 $ 65,188 Income taxes paid $ 1,377 $ 491 $ 68 NON-CASH INVESTING ACTIVITIES: Real estate improvements accrued, not paid $ 11,981 $ 11,457 $ 9,281 Working capital assumed $ — $ — $ 25,170 Real estate and investment acquired by issuance of common shares $ — $ — $ ( 639,809 ) Real estate and investment acquired by assumption of debt $ — $ — $ ( 1,719,772 ) NON-CASH FINANCING ACTIVITIES: Select Income REIT unsecured revolving credit facility $ — $ — $ 108,000 Assumption of mortgage notes payable $ — $ — $ 161,772 Assumption of senior unsecured notes $ — $ — $ 1,450,000 Issuance of common shares $ — $ — $ 639,809 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 consolidated balance sheets to the amounts shown in the consolidated statements of cash flows: As of December 31, 2020 2019 2018 Cash and cash equivalents $ 42,045 $ 93,744 $ 35,349 Restricted cash 14,810 6,952 3,594 Total cash, cash equivalents and restricted cash shown in the consolidated statements of cash flows $ 56,855 $ 100,696 $ 38,943 The accompanying notes are an integral part of these consolidated financial statements. F-9 Table of Contents OFFICE PROPERTIES INCOME TRUST NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (dollars in thousands, except per share amounts) Note 1. Organization Office Properties Income Trust, or OPI, we, us or our, is a real estate investment trust, or REIT, formed in 2009 under Maryland law. As of December 31, 2020, our wholly owned properties were comprised of 181 properties containing approximately 24,889,000 rentable square feet and we had a noncontrolling ownership interest in three properties totaling approximately 444,000 rentable square feet through two unconsolidated joint ventures in which we own 51 % and 50 % interests. Merger with Select Income REIT On December 31, 2018, we completed our acquisition of Select Income REIT, or SIR, a REIT that owned properties primarily net leased to single tenants, pursuant to a merger transaction, or the SIR Merger. As a result of the SIR Merger, we acquired SIR’s property portfolio of 99 properties with approximately 16,500,000 rentable square feet. The aggregate transaction value, based on the closing price of our common shares on December 31, 2018 of $ 6.87 per share (prior to the Reverse Share Split, as defined below), was $ 2,409,740 , excluding closing costs of $ 27,497 ($ 14,508 of which was paid by us and $ 12,989 of which was paid by SIR) and including the repayment or assumption of $ 1,719,772 of SIR debt. In connection with the SIR Merger, SIR shareholders received 1.04 , or 23,282,704 in the aggregate, of our newly issued common shares for each common share of SIR, with cash paid in lieu of fractional shares. As a condition of the SIR Merger, on October 9, 2018, we sold all of the 24,918,421 common shares of SIR we then owned, or the Secondary Sale, in an underwritten public offering at a price of $ 18.25 per share, raising net proceeds of $ 435,125 after deducting underwriting discounts and offering expenses. We used the net proceeds from the Secondary Sale to repay amounts then outstanding under our revolving credit facility. In addition, as a condition of the SIR Merger, on December 27, 2018, SIR paid a pro rata distribution to SIR’s shareholders of record as of the close of business on December 20, 2018 of all 45,000,000 common shares of beneficial interest of Industrial Logistics Properties Trust, or ILPT, that SIR owned, or the ILPT Distribution. The SIR Merger and the other transactions in connection with the SIR Merger, including the Secondary Sale and the ILPT Distribution, are collectively referred to herein as the SIR Transactions. Following completion of the SIR Merger and the other SIR Transactions, on December 31, 2018, we effected a reverse share split of our common shares, or the Reverse Share Split, pursuant to which every four of our common shares issued and outstanding as of the effective time of the Reverse Share Split were converted and reclassified into one of our common shares. All impacted amounts and share information included in the consolidated financial statements and notes hereto for the periods presented prior to January 1, 2019 have been retroactively adjusted for the Reverse Share Split as if the Reverse Share Split occurred on the first day of the first period presented. Note 2. Summary of Significant Accounting Policies Basis of Presentation. These consolidated financial statements include the accounts of us and our subsidiaries, all of which are wholly owned directly or indirectly by us. All intercompany transactions and balances with or among our consolidated subsidiaries have been eliminated. Real Estate Properties. We record our properties at cost and provide depreciation on real estate investments on a straight line basis over estimated useful lives generally ranging from 7 to 40 years. In some circumstances, we engage independent real estate appraisal firms to provide market information and evaluations which are relevant to our purchase price allocations and determinations of useful lives; however, we are ultimately responsible for the purchase price allocations and determinations of useful lives. F-10 Table of Contents OFFICE PROPERTIES INCOME TRUST NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (dollars in thousands, except per share amounts) We allocate the purchase prices of our properties to land, building and improvements based on determinations of the relative fair values of these assets assuming the properties are vacant. We determine the fair value of each property using methods similar to those used by independent appraisers, which may involve estimated cash flows that are based on a number of factors, including capitalization rates and discount rates, among others. We allocate a portion of the purchase price of our properties to above market and below market leases based on the present value (using an interest rate which reflects the risks associated with acquired in place leases at the time each property was acquired by us) of the difference, if any, between (i) the contractual amounts to be paid pursuant to the acquired in place leases and (ii) our estimates of fair market lease rates for the corresponding leases, measured over a period equal to the terms of the respective leases. We allocate a portion of the purchase price to acquired in place leases and tenant relationships based upon market estimates to lease up the property based on the leases in place at the time of purchase. We allocate this aggregate value between acquired in place lease values and tenant relationships based on our evaluation of the specific characteristics of each tenant’s lease. However, we have not separated the value of tenant relationships from the value of acquired in place leases because such value and related amortization expense is immaterial to the accompanying consolidated financial statements. In making these allocations, we consider factors such as estimated carrying costs during the expected lease up periods, including real estate taxes, insurance and other operating income and expenses and costs, such as leasing commissions, legal and other related expenses, to execute similar leases in current market conditions at the time a property was acquired by us. If the value of tenant relationships becomes material in the future, we may separately allocate those amounts and amortize the allocated amounts over the estimated life of the relationships. For transactions that qualify as business combinations, we allocate the excess, if any, of the consideration over the fair value of the assets acquired to goodwill. We amortize capitalized above market lease values (included in acquired real estate leases, net in our consolidated balance sheets) and below market lease values (presented as assumed real estate lease obligations, net in our consolidated balance sheets) as a reduction or increase, respectively, to rental income over the terms of the associated leases. Such amortization resulted in net decreases to rental income of $ 5,440 , $ 2,710 and $ 2,903 during the years ended December 31, 2020, 2019 and 2018, respectively. We amortize the value of acquired in place leases (included in acquired real estate leases, net in our consolidated balance sheets), exclusive of the value of above market and below market acquired in place leases, over the terms of the associated leases. Such amortization, which is included in depreciation and amortization expense, amounted to $ 161,752 , $ 195,268 and $ 91,472 during the years ended December 31, 2020, 2019 and 2018, respectively. If a lease is terminated prior to its stated expiration, we write off the unamortized amounts relating to that lease. As of December 31, 2020 and 2019, our acquired real estate leases and assumed real estate lease obligations, excluding properties classified as held for sale, were as follows: December 31, 2020 2019 Acquired real estate leases: Capitalized above market lease values $ 34,972 $ 61,971 Less: accumulated amortization ( 19,291 ) ( 29,927 ) Capitalized above market lease values, net 15,681 32,044 Lease origination value 868,459 1,032,769 Less: accumulated amortization ( 335,197 ) ( 332,431 ) Lease origination value, net 533,262 700,338 Acquired real estate leases, net $ 548,943 $ 732,382 Assumed real estate lease obligations: Capitalized below market lease values $ 21,092 $ 28,118 Less: accumulated amortization ( 10,504 ) ( 14,943 ) Assumed real estate lease obligations, net $ 10,588 $ 13,175 As of December 31, 2020, the weighted average amortization periods for capitalized above market leases, lease origination value and capitalized below market lease values were 4.0 years, 5.8 years and 5.0 years, respectively. Future amortization of net intangible lease assets and liabilities, to be recognized over the current terms of the associated leases as of December 31, 2020 F-11 Table of Contents OFFICE PROPERTIES INCOME TRUST NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (dollars in thousands, except per share amounts) are estimated to be $ 131,357 in 2021, $ 112,709 in 2022, $ 91,420 in 2023, $ 69,178 in 2024, $ 45,150 in 2025 and $ 88,541 thereafter. We regularly evaluate whether events or changes in circumstances have occurred that could indicate an impairment in the value of long lived assets. 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. 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 lives of our long lived assets. If we change our estimate of the remaining lives, we allocate the carrying value of the affected assets over their revised remaining lives. Cash and Cash Equivalents. We consider highly liquid investments with original maturities of three months or less at the date of purchase to be cash equivalents. Restricted Cash. Restricted cash consists of amounts escrowed for future real estate taxes, insurance, leasing costs, capital expenditures and debt service, as required by certain of our mortgage debts. Deferred Leasing Costs . Deferred leasing costs include brokerage costs, inducements and, until January 1, 2019, legal fees associated with our entering leases. We amortize deferred leasing costs, which are included in depreciation and amortization expense, and inducements, which are included as a reduction to rental income, on a straight line basis over the terms of the respective leases. We recorded amortization of deferred leasing costs of $ 5,985 , $ 5,216 and $ 4,330 , and reductions to rental income related to the amortization of inducements of $ 902 , $ 757 and $ 512 for the years ended December 31, 2020, 2019 and 2018, respectively. Effective January 1, 2019, in accordance with Financial Accounting Standards Board, or FASB, Accounting Standards Update, or ASU, No. 2016-02, Leases , legal costs associated with the execution of our leases, which were previously capitalized and amortized over the life of their respective leases, are expensed as incurred and included in general and administrative expenses in our consolidated statements of comprehensive income (loss). Deferred leasing costs, excluding properties classified as held for sale, totaled $ 59,691 and $ 55,716 at December 31, 2020 and 2019, respectively, and accumulated amortization of deferred leasing costs totaled $ 17,065 and $ 15,609 at December 31, 2020 and 2019, respectively. Future amortization of deferred leasing costs to be recognized during the current terms of our existing leases as of December 31, 2020 are estimated to be $ 6,672 in 2021, $ 5,754 in 2022, $ 5,060 in 2023, $ 4,335 in 2024, $ 3,699 in 2025 and $ 17,106 thereafter. Debt Issuance Costs . Debt issuance costs include capitalized issuance or assumption costs related to borrowings, which are amortized to interest expense over the terms of the respective loans. Debt issuance costs, net of accumulated amortization, for our revolving credit facility are included in other assets in our consolidated balance sheets. As of December 31, 2020 and 2019, debt issuance costs for our revolving credit facility were $ 4,125 and accumulated amortization of debt issuance costs for our revolving credit facility were $ 2,069 and $ 1,059 , respectively. Debt issuance costs, net of accumulated amortization, for our senior unsecured notes and mortgage notes payable are presented as a direct deduction from the associated debt liability in our consolidated balance sheets. As of December 31, 2020 and 2019, debt issuance costs, net of accumulated amortization, for our senior unsecured notes and mortgage notes payable totaled $ 17,545 and $ 10,631 , respectively. Future amortization of debt issuance costs to be recognized with respect to our revolving credit facility, senior unsecured notes and mortgage notes as of December 31, 2020 are estimated to be $ 2,659 in 2021, $ 2,428 in 2022, $ 1,132 in 2023, $ 1,069 in 2024, $ 584 in 2025 and $ 11,729 thereafter. Mortgage Notes Receivable. In connection with a property we sold in July 2016, we provided $ 3,600 of mortgage financing to the buyer. The mortgage note required interest to be paid at an annual rate of LIBOR plus 4.0 %, subject to a minimum annual interest rate of 5.0 %, and required monthly payments of interest only until it was repaid in full in March 2020. The mortgage note receivable was included in other assets in our consolidated balance sheet at December 31, 2019. Equity Securities. We previously owned 2,801,060 common shares of class A common stock of The RMR Group Inc., or RMR Inc., including 1,586,836 common shares acquired from SIR on December 31, 2018 in connection with the SIR Merger, that we sold on July 1, 2019 for net proceeds of $ 104,674 , after deducting underwriting discounts and commissions and other offering expenses. Prior to the sale of our shares of RMR Inc. class A common stock on July 1, 2019, our equity securities were recorded at fair value based on their quoted market price at the end of each reporting period. See Note 6 for more information regarding the sale of our RMR Inc. class A common stock. F-12 Table of Contents OFFICE PROPERTIES INCOME TRUST NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (dollars in thousands, except per share amounts) Equity Method Investments. We previously accounted for our investments in Affiliates Insurance Company, or AIC, until AIC was dissolved on February 13, 2020, and SIR, until we sold the SIR common shares we owned on October 9, 2018, using the equity method of accounting. Significant influence was present through common representation on the boards of trustees or directors of us, AIC and SIR. As of December 31, 2020 and 2019, our investment in AIC had a carrying value of $ 11 and $ 298 , respectively. These amounts are included in other assets in our consolidated balance sheets. We recognized income of $ 281 and $ 516 related to our investment in AIC for the years ended December 31, 2019 and 2018, respectively. These amounts are included in equity in net losses of investees in our consolidated statements of comprehensive income (loss). Our other comprehensive income (loss) includes our proportionate share of unrealized losses on securities which were owned and held for sale by AIC of $ 90 and $( 69 ) related to our investment in AIC for the years ended December 31, 2019 and 2018, respectively. See Notes 1, 3, 6, 11 and 12 for more information regarding our investments in AIC and SIR. We also own 51 % and 50 % interests in two unconsolidated joint ventures which own three properties. The properties owned by these joint ventures are encumbered by an aggregate of $ 82,000 of mortgage indebtedness. We do not control the activities that are most significant to these joint ventures and, as a result, we account for our investment in these joint ventures under the equity method of accounting. See Note 3 for more information regarding our unconsolidated joint ventures. We periodically evaluate our equity method investments for possible indicators of other than temporary impairment whenever events or changes in circumstances indicate the carrying amount of the investment might not be recoverable. These indicators may include the length of time and the extent to which the market value of our investment is below our carrying value, the financial condition of our investees, our intent and ability to be a long term holder of the investment and other considerations. If the decline in fair value is judged to be other than temporary, we record an impairment charge to adjust the basis of the investment to its estimated fair value. Other Liabilities. We initially acquired 1,541,201 shares of class A common stock of RMR Inc. on June 5, 2015 for cash and share consideration of $ 17,462 . We concluded, for accounting purposes, that the cash and share consideration we paid for our investment in these shares represented a discount to the fair value of these shares. We initially accounted for this investment under the cost method of accounting and recorded this investment at its estimated fair value of $ 39,833 as of June 5, 2015 using Level 3 inputs, as defined in the fair value hierarchy under U.S. generally accepted accounting principles, or GAAP. As a result, we recorded a liability for the amount by which the estimated fair value of these shares exceeded the price we paid for these shares. This liability is included in accounts payable and other liabilities in our consolidated balance sheets. This liability is being amortized on a straight line basis through December 31, 2035 as an allocated reduction to our business management and property management fee expense. We amortized $ 1,087 of this liability during each of the years ended December 31, 2020, 2019 and 2018. These amounts are included in the net business management and property management fee amounts for such periods disclosed in Note 5. As of December 31, 2020, the remaining unamortized amount of this liability was $ 16,319 . Future amortization of this liability as of December 31, 2020 is estimated to be $ 1,087 in 2021 through 2025 and $ 10,884 thereafter. Revenue Recognition. We are a lessor of commercial office properties. Our leases provide our tenants with the contractual right to use and economically benefit from all of the physical space specified in the leases; therefore, we have determined to evaluate our leases as lease arrangements. In February 2016, the FASB issued ASU No. 2016-02, Leases . In July 2018, the FASB issued ASU No. 2018-10, Codification Improvements to Topic 842, Leases and ASU No. 2018-11, Leases (Topic 842): Targeted Improvements . In December 2018, the FASB issued ASU No. 2018-20 Leases (Topic 842), Narrow-Scope Improvements for Lessors . Collectively, these standards set out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e., lessees and lessors). ASU No. 2016-02 requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase of the leased asset by the lessee. This classification will determine whether the lease expense is recognized based on an effective interest method or on a straight line basis over the term of the lease. ASU No. 2016-02 requires lessors to account for leases using an approach that is substantially equivalent to existing guidance for sales type leases, direct financing leases and operating leases. These standards were effective as of January 1, 2019. Upon adoption, we applied the package of practical expedients that allowed us to not reassess (i) whether any expired or existing contracts are or contain leases, (ii) lease classification for any expired or existing leases and (iii) initial direct costs for any expired or existing leases. Furthermore, we applied the optional transition method in ASU No. 2018-11, which allowed us to initially apply the new leases standard at the adoption date and recognize a cumulative effect adjustment to the opening balance of retained earnings in the adoption period, although we did not have an adjustment. Additionally, our leases met the criteria in ASU No. 2018-11 to not separate non-lease components from the related lease component; therefore, the accounting for these leases remained largely unchanged from the previous standard. The adoption of ASU No. 2016-02 and the related improvements did not have a material impact in our F-13 Table of Contents OFFICE PROPERTIES INCOME TRUST NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (dollars in thousands, except per share amounts) consolidated financial statements. Upon adoption, (i) allowances for bad debts are recognized as a direct reduction of rental income, and (ii) legal costs associated with the execution of our leases, which were previously capitalized and amortized over the life of their respective leases, are expensed as incurred. Our leases provide for base rent payments and in addition may 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. Certain of our leases contain non-lease components, such as property level operating expenses and capital expenditures reimbursed by our tenants as well as other required lease payments. We have determined that all of our leases qualify for the practical expedient to not separate the lease and non-lease components because (i) the lease components are operating leases and (ii) the timing and pattern of recognition of the non-lease components are the same as those of the lease components. We apply Accounting Standards Codification 842, Leases , to the combined component. Income derived by our leases is recorded in rental income in our consolidated statements of comprehensive income (loss). Certain tenants are obligated to pay directly their obligations under their leases for insurance, real estate taxes and certain other expenses. These obligations, which have been assumed by the tenants under the terms of their respective leases, are not reflected in our consolidated financial statements. To the extent any tenant responsible for any such obligations under the applicable lease defaults on such lease or if it is deemed probable that the tenant will fail to pay for such obligations, we would record a liability for such obligations. See Note 4 for more information regarding our leases. Income Taxes. We have elected to be taxed as a REIT under the United States Internal Revenue Code of 1986, as amended, and, accordingly, we generally will not be subject to federal income taxes provided we distribute our taxable income and meet certain other requirements to qualify for taxation as a REIT. We are, however, subject to certain state and local taxes. Cumulative Other Comprehensive Income (Loss). Cumulative other comprehensive income (loss) represents our share of the cumulative comprehensive income and losses of our equity method investees and, prior to January 1, 2018, unrealized gains and losses related to our former investment in RMR Inc. Per Common Share Amounts. We calculate basic earnings per common share by dividing net income (loss) available for common shareholders by the weighted average number of our common shares of beneficial ownership, $ .01 par value, or our common shares, outstanding during the period. We calculate diluted earnings per share using the more dilutive of the two class method or the treasury stock method. Unvested share awards and other potentially dilutive common shares, together with the related impact on earnings, are considered when calculating diluted earnings per share. For the years ended December 31, 2020, 2019 and 2018, there were no dilutive common shares. In addition, for the years ended December 31, 2020, 2019 and 2018, 14 , 12 and four unvested common shares, respectively, were not included in the calculation of diluted earnings per share because to do so would have been antidilutive. Use of Estimates. Preparation of these financial statements in conformity with GAAP requires us to make estimates and assumptions that may affect the amounts reported in these consolidated financial statements and related notes. The actual results could differ from these estimates. Segment Reporting. We operate in one business segment: direct ownership of real estate properties. New Accounting Pronouncements. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, or ASU No. 2016-13, which requires that entities use a new forward looking “expected loss” model that generally will result in the earlier recognition of allowance for credit losses. The measurement of expected credit losses is based upon historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. We adopted ASU No. 2016-13 on January 1, 2020 using the modified retrospective approach. The implementation of this standard did not have a material impact in our consolidated financial statements. Note 3. Real Estate Properties As of December 31, 2020, our wholly owned properties were comprised of 181 properties containing approximately 24,889,000 rentable square feet, with an aggregate undepreciated carrying value of $ 3,577,232 , including $ 55,089 classified as F-14 Table of Contents OFFICE PROPERTIES INCOME TRUST NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (dollars in thousands, except per share amounts) held for sale, and we had noncontrolling ownership interests in three properties totaling approximately 444,000 rentable square feet through two unconsolidated joint ventures in which we own 51 % and 50 % interests. We generally lease space at our properties on a gross lease, modified gross lease or net lease basis pursuant to fixed term contracts expiring between 2021 and 2040. Some of our leases generally require us to pay all or some property operating expenses and to provide all or most property management services. During the year ended December 31, 2020, we entered into 77 leases for approximately 1,965,000 rentable square feet for a weighted (by rentable square feet) average lease term of 7.3 years and we made commitments for approximately $ 43,404 of leasing related costs. As of December 31, 2020, we have estimated unspent leasing related obligations of $ 51,913 . 2020 Acquisition Activities During the year ended December 31, 2020, we acquired two properties containing a combined approximately 163,000 rentable square feet for an aggregate purchase price of $ 47,215 , including capitalized acquisition related costs of $ 590 . These acquisitions were accounted for as asset acquisitions. We allocated the purchase prices of these acquisitions based on the relative estimated fair values of the acquired assets as follows: Acquisition Date Location Number of Properties Rentable Square Feet Purchase Price Land Buildings and Improvements Acquired Real Estate Leases February 2020 Boston, MA 1 13,000 $ 11,864 $ 2,618 $ 9,246 $ — December 2020 Fort Mill, SC 1 150,000 35,351 5,031 22,526 7,794 2 163,000 $ 47,215 $ 7,649 $ 31,772 $ 7,794 In November 2020, we entered into an agreement to acquire a property adjacent to a property we own in Boston, MA for a purchase price of $ 26,975 , excluding acquisition related costs. This acquisition is expected to occur before the end of the first quarter. However, this acquisition is subject to conditions; accordingly, we cannot be sure that we will complete this acquisition or that this acquisition will not be delayed or the terms will not change. 2019 Acquisition Activities In November 2019, we acquired a land parcel adjacent to a property we own in Boston, MA for $ 2,900 , excluding acquisition related costs. F-15 Table of Contents OFFICE PROPERTIES INCOME TRUST NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (dollars in thousands, except per share amounts) 2018 Acquisition Activities As described in Note 1, on December 31, 2018, we completed the SIR Merger, pursuant to which we acquired SIR’s property portfolio of 99 properties with approximately 16,500,000 rentable square feet. The total consideration transferred and assumed debt for the SIR Merger was $ 2,409,740 , including the assumption of $ 1,719,772 of debt and excluding acquisition related costs. The following table summarizes the consideration transferred and liabilities assumed: Total Purchase Price (excluding acquisition related costs): OPI common shares issued (1) 23,282,704 Closing price of OPI common shares on December 31, 2018 (1) $ 27.48 Value of consideration transferred $ 639,809 Cash consideration for fractional shares 8 Equity issuance costs ( 239 ) Value of consideration transferred 639,578 Assumed working capital 50,390 Assumed senior unsecured notes, principal balance 1,450,000 Assumed mortgage notes payable, principal balance 161,772 Select Income REIT unsecured revolving credit facility repaid at closing 108,000 Non-cash portion of purchase price 1,770,162 Total consideration transferred and liabilities assumed $ 2,409,740 (1) OPI common shares issued and the closing price of OPI common shares on December 31, 2018 is after giving effect to the Reverse Share Split. F-16 Table of Contents OFFICE PROPERTIES INCOME TRUST NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (dollars in thousands, except per share amounts) As of December 31, 2019, we finalized the purchase price allocation for the SIR Merger from the preliminary amounts reported as of December 31, 2018. The adjustments made during the year ended December 31, 2019 to the fair value of acquired assets and liabilities assumed did not have a significant impact on our consolidated balance sheets or our consolidated statements of comprehensive income (loss). The following table summarizes the final purchase price allocation for SIR based on estimated fair values as of the December 31, 2018: Purchase Price Allocation: Land $ 477,977 Buildings and improvements 956,801 Assets of properties held for sale 6,846 Acquired real estate leases 854,431 Cash 24,744 Restricted cash 476 Rents receivable 11,370 Other assets (1) 88,658 Total assets 2,421,303 Unsecured revolving credit facility (2) ( 108,000 ) Senior unsecured notes (3) ( 1,410,947 ) Mortgage notes payable (4) ( 159,490 ) Accounts payable and other liabilities ( 61,289 ) Assumed real estate lease obligations ( 11,879 ) Due to related persons ( 30,120 ) Net assets acquired 639,578 Assumed working capital 50,390 Select Income REIT unsecured revolving credit facility repaid at closing (2) 108,000 Assumed senior unsecured notes, principal balance 1,450,000 Assumed mortgage notes payable, principal balance 161,772 Consideration transferred and liabilities assumed (5) $ 2,409,740 (1) Other assets include $ 84,229 for SIR’s investment in shares of class A common stock of RMR Inc. which was recorded at fair value as of December 31, 2018. (2) We repaid the outstanding balance under SIR’s revolving credit facility at the closing of the SIR Merger with borrowings under our revolving credit facility. (3) The aggregate principal balance of the senior unsecured notes was $ 1,450,000 as of December 31, 2018. (4) The aggregate principal balance of the mortgage notes payable was $ 161,772 as of December 31, 2018. (5) Purchase price excludes acquisition related costs. We were the accounting acquirer of SIR and accounted for the SIR Merger as a business combination because substantially all of the fair value of the gross assets acquired was not concentrated in a single identifiable asset or a group of similar identifiable assets and we acquired inputs and a substantive process that together significantly contributed to the ability to create outputs. As we have and SIR had no employees, the personnel and various services required to operate our and SIR’s businesses are and were provided pursuant to business and property management agreements with The RMR Group LLC, or RMR LLC. These agreements were in effect before, and, in our case, remain in effect after, the SIR Merger. As a result, our acquisition of SIR included a substantive process for accounting purposes. The assets acquired and liabilities assumed were recorded at their respective fair values and added to our consolidated balance sheet as of December 31, 2018. We allocated the purchase price based on the estimated fair values of the acquired assets and liabilities assumed in a manner consistent with our purchase price allocation accounting policy described in Note 2. We engaged an independent real estate consulting firm to assist us with determining the purchase price allocations and to provide market information and evaluations which are relevant to purchase price allocations and determinations of useful lives. As of the date acquired, the weighted average amortization periods for capitalized above market lease values, lease origination value and capitalized below market lease values were 5.8 years, 7.2 years and 5.7 years, respectively. F-17 Table of Contents OFFICE PROPERTIES INCOME TRUST NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (dollars in thousands, except per share amounts) Disposition Activities The sales completed during the years ended December 31, 2020, 2019 and 2018, as presented in the tables below, do not represent significant dispositions individually (unless otherwise noted) or in the aggregate nor do they represent a strategic shift in our business. As a result, the results of operations of these properties are included in continuing operations through the date of sale in our consolidated statements of comprehensive income (loss). 2020 Disposition Activities During the year ended December 31, 2020, we sold 10 properties containing a combined approximately 906,000 rentable square feet for an aggregate sales price of $ 110,463 , excluding closing costs and including the repayment of one mortgage note with an outstanding principal balance of $ 13,095 , an annual interest rate of 5.9 % and a maturity date in August 2021. Date of Sale Number of Properties Location Rentable Square Feet Gross Sales Price (1) Gain (Loss) on Sale of Real Estate Loss on Impairment of Real Estate January 2020 (2) 2 Stafford, VA 65,000 $ 14,063 $ 4,771 $ — January 2020 (2) 1 Windsor, CT 97,000 7,000 314 — February 2020 (2) 1 Lincolnshire, IL 223,000 12,000 1,179 — March 2020 (2)(3) 1 Trenton, NJ 267,000 30,100 ( 179 ) — March 2020 (2) 1 Fairfax, VA 83,000 22,200 4,754 — October 2020 4 Fairfax, VA 171,000 25,100 16 2,954 10 906,000 $ 110,463 $ 10,855 $ 2,954 (1) Gross sales price is the gross contract price, includes purchase price adjustments, if any, and excludes closing costs. (2) Held for sale as of December 31, 2019. (3) We recorded a $ 9,454 loss on impairment of real estate during the year ended December 31, 2019 to adjust the carrying value of this property to its fair value less costs to sell. As of December 31, 2020, we had two properties with an aggregate undepreciated carrying value of $ 55,089 under agreements to sell, as presented in the following table. We have classified these properties as held for sale in our consolidated balance sheet at December 31, 2020. The sales of these properties were completed in January 2021. Date of Sale Agreement Number of Properties Location Rentable Square Feet Gross Sales Price (1) December 2020 — Kansas City, MO (2) 10,000 $ 845 December 2020 1 Richmond, VA 311,000 130,000 1 321,000 $ 130,845 (1) Gross sales price is the gross contract price, includes purchase price adjustments, if any, and excludes closing costs. (2) Consists of a warehouse facility adjacent to a property we own in Kansas City, MO. In February 2021, we entered into an agreement to sell a property located in Huntsville, AL containing approximately 1,371,000 rentable square feet for a sales price of $ 39,000 , excluding closing costs. This sale is expected to occur before the end of the second quarter. However, this sale is subject to conditions; accordingly, we cannot be sure that we will complete this sale or that this sale will not be delayed or the terms will not change. F-18 Table of Contents OFFICE PROPERTIES INCOME TRUST NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (dollars in thousands, except per share amounts) 2019 Disposition Activities During the year ended December 31, 2019, we sold 58 properties containing a combined approximately 6,179,000 rentable square feet for an aggregate sales price of $ 848,853 , excluding closing costs. Date of Sale Number of Properties Location Rentable Square Feet Gross Sales Price (1) Gain (Loss) on Sale of Real Estate Loss on Impairment of Real Estate February 2019 34 Northern Virginia and Maryland 1,636,000 $ 198,500 $ — $ 732 March 2019 1 Washington, D.C. (2) 129,000 70,000 22,075 — May 2019 1 Buffalo, NY 122,000 16,900 — 5,137 May 2019 1 Maynard, MA 287,000 5,000 ( 227 ) — June 2019 1 Kapolei, HI 417,000 7,100 — — July 2019 1 San Jose, CA 72,000 14,000 ( 270 ) — July 2019 1 Nashua, NH 322,000 25,000 8,401 — August 2019 1 Arlington, TX 182,000 14,900 187 — August 2019 1 Rochester, NY 95,000 4,765 ( 104 ) — August 2019 1 Hanover, PA 502,000 5,500 ( 417 ) — August 2019 1 San Antonio, TX 618,000 198,000 3,869 — September 2019 1 Topeka, KS 144,000 15,600 36 — September 2019 1 Falling Waters, WV 40,000 650 — 2,179 September 2019 1 San Diego, CA 44,000 8,950 3,062 — October 2019 3 Columbia, SC 181,000 10,750 — 3,581 November 2019 3 Metro DC - MD 373,000 61,938 1,177 — December 2019 1 San Diego, CA 148,000 23,750 6,823 — December 2019 1 Phoenix, AZ 123,000 12,850 860 — December 2019 1 Houston, TX 497,000 130,000 59,992 — December 2019 1 Kansas City, KS 171,000 11,700 — 1,172 December 2019 1 San Jose, CA 76,000 13,000 ( 333 ) — 58 6,179,000 $ 848,853 $ 105,131 $ 12,801 (1) Gross sales price is the gross contract price, includes purchase price adjustments, if any, and excludes closing costs. (2) Represents an individually significant disposition. 2018 Disposition Activities During the year ended December 31, 2018, we sold 19 properties containing a combined approximately 2,175,000 rentable square feet for an aggregate sales price of $ 320,255 , excluding closing costs. Date of Sale Number of Properties Location Rentable Square Feet Gross Sales Price (1) Gain on Sale of Real Estate Loss on Impairment of Real Estate March 2018 1 Minneapolis, MN 194,000 $ 20,000 $ — $ 640 May 2018 1 New York, NY 187,000 118,500 17,249 — May 2018 1 Sacramento, CA 111,000 10,755 — 3,029 November 2018 1 Golden, CO 43,000 4,000 54 — December 2018 15 Southern Virginia 1,640,000 167,000 3,358 — 19 2,175,000 $ 320,255 $ 20,661 $ 3,669 (1) Gross sales price is the gross contract price, includes purchase price adjustments, if any, and excludes closing costs. In February 2018, we entered an agreement to sell an office property located in Safford, AZ with approximately 36,000 rentable square feet for $ 8,250 . We recorded a $ 2,453 loss on impairment of real estate to reduce the carrying value of the property to its estimated fair value less costs to sell during the three months ended March 31, 2018. In April 2018, the buyer F-19 Table of Contents OFFICE PROPERTIES INCOME TRUST NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (dollars in thousands, except per share amounts) terminated the sale agreement and we removed this property from held for sale status. We recorded a $ 322 adjustment to impairment of real estate to increase the carrying value of the property to its estimated fair value during the year ended December 31, 2018. During the year ended December 31, 2018, we also recorded a $ 2,830 loss on impairment of real estate to reduce the carrying value of a portfolio of 34 properties, which was classified as held for sale as of December 31, 2018, to its estimated fair value less costs to sell. Unconsolidated Joint Ventures We own interests in two joint ventures that own three properties. We account for these investments under the equity method of accounting. As of December 31, 2020 and 2019, our investments in unconsolidated joint ventures consisted of the following: OPI Ownership OPI Carrying Value of Investments at December 31, Number of Properties Location Rentable Square Feet Joint Venture 2020 2019 Prosperity Metro Plaza 51 % $ 21,888 $ 22,483 2 Fairfax, VA 329,000 1750 H Street, NW 50 % 16,063 17,273 1 Washington, D.C. 115,000 Total $ 37,951 $ 39,756 3 444,000 The following table provides a summary of the mortgage debt of our two unconsolidated joint ventures: Joint Venture Interest Rate (1) Maturity Date Principal Balance at December 31, 2020 and 2019 (2) Prosperity Metro Plaza 4.09 % 12/1/2029 $ 50,000 1750 H Street, NW 3.69 % 8/1/2024 32,000 Weighted Average/Total 3.93 % $ 82,000 (1) Includes the effect of mark to market purchase accounting. (2) Reflects the entire balance of the debt secured by the properties and is not adjusted to reflect the interests in the joint ventures we do not own. None of the debt is recourse to us. At December 31, 2020, the aggregate unamortized basis difference of our two unconsolidated joint ventures of $ 7,463 is primarily attributable to the difference between the amount for which we purchased our interest in the joint ventures, including transaction costs, and the historical carrying value of the net assets of the joint ventures. This difference is being amortized over the remaining useful life of the related properties and included in the reported amount of equity in net earnings (losses) of investees. Note 4. Leases Rental income from operating leases, including 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. We increased rental income by $ 16,079 , $ 27,507 and $ 10,164 to record revenue on a straight line basis during the years ended December 31, 2020, 2019 and 2018, respectively. Rents receivable, excluding properties classified as held for sale, include $ 68,824 and $ 54,837 of straight line rent receivables at December 31, 2020 and 2019, 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 $ 75,851 , $ 91,076 and $ 45,261 for the years ended December 31, 2020, 2019 and 2018, respectively, of which tenant reimbursements totaled $ 71,385 , $ 86,353 and $ 40,764 , respectively. F-20 Table of Contents OFFICE PROPERTIES INCOME TRUST NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (dollars in thousands, except per share amounts) The following operating lease maturity analysis presents the future contractual lease payments to be received by us through 2040 as of December 31, 2020: Year Amount 2021 $ 474,170 2022 435,572 2023 389,272 2024 316,483 2025 234,064 Thereafter 842,615 Total $ 2,692,176 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. As of December 31, 2020, tenants who currently represent approximately 6.3 % of our total operating lease maturities have currently exercisable rights to terminate their leases before the stated terms of their leases expire. In 2021, 2022, 2023, 2024, 2025, 2026, 2027, 2028, 2029 and 2035, early termination rights become exercisable by other tenants who currently represent an additional approximately 1.4 %, 3.4 %, 1.3 %, 2.2 %, 5.0 %, 2.9 %, 1.9 %, 3.1 %, 0.5 % and 1.6 % of our total operating lease maturities, respectively. In addition, as of December 31, 2020, 13 of our tenants have the right to terminate their leases if the respective legislature or other funding authority does not appropriate the funding necessary for the tenant to meet its obligation. These 13 tenants represent approximately 7.1 % of our total operating lease maturities as of December 31, 2020. As a result of the COVID-19 pandemic, some of our tenants have requested rent assistance. As of February 16, 2021, we have granted temporary rent assistance totaling $ 2,546 to 19 of our tenants who represent approximately 3.3 % of our annualized rental income, as defined below in Note 7, as of December 31, 2020, pursuant to deferred payment plans. These tenants are obligated to pay, in most cases, the deferred rent over a 12 -month period, certain of which commenced in 2020. We have elected to use the FASB relief package regarding the application of lease accounting guidance to lease concessions provided as a result of the COVID-19 pandemic. The FASB relief package provides entities with the option to account for lease concessions resulting from the COVID-19 pandemic outside of the existing lease modification guidance if the resulting cash flows from the modified lease are substantially the same as or less than the original lease. Because the deferred rent amounts referenced above will be repaid, the cash flows from the respective leases are substantially the same as before the rent deferrals. The deferred amounts did not impact our operating results for the year ended December 31, 2020. As of December 31, 2020, deferred payments totaling $ 772 are included in rents receivable in our consolidated balance sheet. Right of use asset and lease liability. For leases where we are the lessee, we are required to record a right of use asset and lease liability for all leases with an initial term greater than 12 months. As of December 31, 2020, we had one lease that met these criteria where we are the lessee, which expired on January 31, 2021. We subleased a portion of the space, which sublease expired on January 31, 2021. The value of the right of use asset and related liability representing our future obligation under the lease arrangement for which we are the lessee were $ 168 and $ 174 , respectively, as of December 31, 2020 and $ 2,149 and $ 2,179 , respectively, as of December 31, 2019. The right of use asset and related lease liability are included in other assets , net and accounts payable and other liabilities , respectively, in our consolidated balance sheets. Rent expense incurred under the lease, net of sublease revenue, was $ 1,749 , $ 1,670 and $ 1,707 for the years ended December 31, 2020, 2019 and 2018, respectively. Note 5. Business and Property Management Agreements with RMR LLC We have no employees. The personnel and various services we require to operate our business are provided to us by RMR LLC. We have two agreements with RMR LLC 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. Prior to the consummation of the SIR Merger, SIR had similar business and property management agreements with RMR LLC on substantially similar terms, which agreements were terminated in connection with the SIR Merger. See Notes 1 and 6 for more information regarding our relationship, agreements and transactions with SIR and RMR LLC. F-21 Table of Contents OFFICE PROPERTIES INCOME TRUST NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (dollars in thousands, except per share amounts) Management Agreements with RMR LLC . Our management agreements with RMR LLC provide for an annual base management fee, an annual incentive management fee and property management and construction supervision fees, payable in cash, among other terms: • Base Management Fee. The annual base management fee payable to RMR LLC by us for each applicable period is equal to the lesser of: • the sum of (a) 0.5 % of the average aggregate historical cost of the real estate assets acquired from a REIT to which RMR LLC provided business management or property management services, or the Transferred Assets, plus (b) 0.7 % of the average aggregate historical cost of our real estate investments excluding the Transferred Assets up to $ 250,000 , plus (c) 0.5 % of the average aggregate historical cost of our real estate investments excluding the Transferred Assets exceeding $ 250,000 ; and • the sum of (a) 0.7 % of the average closing price per share of our common shares on the stock exchange on which such shares are principally traded during such period, multiplied by the average number of our common shares outstanding during such period, plus the daily weighted average of the aggregate liquidation preference of each class of our preferred shares outstanding during such period, plus the daily weighted average of the aggregate principal amount of our consolidated indebtedness during such period, or, together, our Average Market Capitalization, up to $ 250,000 , plus (b) 0.5 % of our Average Market Capitalization exceeding $ 250,000 . The average aggregate historical cost of our real estate investments includes our consolidated assets invested, directly or indirectly, in equity interests in or loans secured by real estate and personal property owned in connection with such real estate (including acquisition related costs and costs which may be allocated to intangibles or are unallocated), all before reserves for depreciation, amortization, impairment charges or bad debts or other similar non-cash reserves; provided, however, our prior ownership of SIR common shares was not included as part of our real estate investments for purposes of calculating our base management fees due to RMR LLC since SIR paid separate business management fees to RMR LLC. • Incentive Management Fee . The incentive management fee which may be earned by RMR LLC for an annual period is calculated as follows: • An amount, subject to a cap based on the value of our common shares outstanding, equal to 12 % of the product of: • our equity market capitalization on the last trading day of the year immediately prior to the relevant three year measurement period, and the amount (expressed as a percentage) by which the total return per share, as defined in the business management agreement and further described below, of our common shareholders (i.e., share price appreciation plus dividends) exceeds the total shareholder return of the applicable index, or the benchmark return per share, for the relevant measurement period. Effective as of January 1, 2019, we amended our business management agreement with RMR LLC so that the SNL U.S. Office REIT Index will be used for periods beginning on and after January 1, 2019, with the SNL U.S. REIT Equity Index for periods ending on or prior to December 31, 2018. • For purposes of the total return per share of our common shareholders, share price appreciation for a measurement period is determined by subtracting (1) the closing price of our common shares on The Nasdaq Stock Market LLC, or Nasdaq, on the last trading day of the year immediately before the first year of the applicable measurement period, or the initial share price, from (2) the average closing price of our common shares on the 10 consecutive trading days having the highest average closing prices during the final 30 trading days in the last year of the measurement period. • The calculation of the incentive management fee (including the determinations of our equity market capitalization, initial share price and the total return per share of our common shareholders) is subject to adjustments if we issue or repurchase our common shares, or if our common shares are forfeited, during the measurement period. • No incentive management fee is payable by us unless our total return per share during the measurement period is positive. F-22 Table of Contents OFFICE PROPERTIES INCOME TRUST NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (dollars in thousands, except per share amounts) • The measurement periods are three year periods ending with the year for which the incentive management fee is being calculated. • If our total return per share exceeds 12 % per year in any measurement period, the benchmark return per share is adjusted to be the lesser of the total shareholder return of the applicable index for such measurement period and 12 % per year, or the adjusted benchmark return per share. In instances where the adjusted benchmark return per share applies, the incentive management fee will be reduced if our total return per share is between 200 basis points and 500 basis points below the applicable index by a low return factor, as defined in the business management agreement, and there will be no incentive management fee paid if, in these instances, our total return per share is more than 500 basis points below the applicable index. • The incentive management fee is subject to a cap. The cap is equal to the value of the number of our common shares which would, after issuance, represent 1.5 % of the number of our common shares then outstanding multiplied by the average closing price of our common shares during the 10 consecutive trading days having the highest average closing prices during the final 30 trading days of the relevant measurement period. • Incentive management fees we paid to RMR LLC for any period may be subject to “clawback” if our financial statements for that period are restated due to material non-compliance with any financial reporting requirements under the securities laws as a result of the bad faith, fraud, willful misconduct or gross negligence of RMR LLC and the amount of the incentive management fee we paid was greater than the amount we would have paid based on the restated financial statements. Pursuant to our business management agreement with RMR LLC, we recognized net business management fees of $ 17,358 , $ 21,320 and $ 16,381 for the years ended December 31, 2020, 2019 and 2018, respectively. The net business management fees we recognized are included in general and administrative expenses in our consolidated statements of comprehensive income (loss) for these periods. The net business management fees we recognized for each of the years ended December 31, 2020, 2019 and 2018 reflect a reduction of $ 603 for the amortization of the liability we recorded in connection with our investment in RMR Inc., as further described in Note 2. No incentive management fee was payable to RMR LLC under our business management agreement for the years ended December 31, 2020, 2019 or 2018. • Property Management and Construction Supervision Fees . The property management fees payable to RMR LLC by us for each applicable period are equal to 3.0 % of gross collected rents and the construction supervision fees payable to RMR LLC by us for each applicable period are equal to 5.0 % of construction costs. Pursuant to our property management agreement with RMR LLC, we recognized aggregate net property management and construction supervision fees of $ 20,774 , $ 21,911 and $ 13,989 for each of the years ended December 31, 2020, 2019 and 2018, respectively. The net property management and construction supervision fees we recognized for the years ended December 31, 2020, 2019 and 2018 reflect a reduction of $ 484 for each of those years for the amortization of the liability we recorded in connection with our former investment in RMR Inc., as further described in Note 2. For the years ended December 31, 2020, 2019 and 2018, $ 17,328 , $ 19,320 , and $ 12,317 , respectively, of the total net property management and construction supervision fees were expensed to other operating expenses in our consolidated statements of income (loss) and $ 3,446 , $ 2,591 , and $ 1,672 , respectively, were capitalized as building improvements in our consolidated balance sheets. In January 2019, we paid RMR LLC $ 2,185 for SIR’s 2018 business management, property management and construction supervision fees that it had accrued, but not paid, as of December 31, 2018. We also paid RMR LLC a business management incentive fee of $ 25,817 , which represented the incentive fee incurred, but not paid, by SIR for the year ended December 31, 2018. We had assumed the obligation to pay these amounts as a result of the SIR Merger. • Expense Reimbursement . We are generally responsible for all of our operating expenses, including certain expenses incurred or arranged by RMR LLC on our behalf. We are generally not responsible for payment of RMR LLC’s employment, office or administrative expenses incurred to provide management services to us, except for the employment and related expenses of RMR LLC’s employees assigned to work exclusively or partly at our properties, our share of the wages, benefits and other related costs of RMR LLC’s centralized accounting personnel, our share of RMR LLC’s costs for providing our internal audit function and as otherwise agreed. Our Audit Committee appoints our Director of Internal Audit and our Compensation Committee approves the costs of our internal audit function. Our F-23 Table of Contents OFFICE PROPERTIES INCOME TRUST NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (dollars in thousands, except per share amounts) property level operating expenses are generally incorporated into rents charged to our tenants, including certain payroll and related costs incurred by RMR LLC. We reimbursed RMR LLC $ 24,919 , $ 26,442 and $ 21,279 for these expenses and costs for each of the years ended December 31, 2020, 2019 and 2018, respectively. We included these amounts in other operating expenses and general and administrative expense, as applicable, for these periods. We assumed the obligation to reimburse RMR LLC for similar expenses and costs that RMR LLC had incurred on behalf of SIR in the ordinary course but which SIR had not paid as of December 31, 2018. We reimbursed RMR LLC $ 462 in January 2019 for these SIR expenses and costs. • Term . Our management agreements with RMR LLC have terms that end on December 31, 2040, and automatically extend on December 31st of each year for an additional year, so that the terms of our management agreements thereafter end on the 20th anniversary of the date of the extension. • Termination Rights . We have the right to terminate one or both of our management agreements with RMR LLC: (i) at any time on 60 days’ written notice for convenience, (ii) immediately on written notice for cause, as defined therein, (iii) on written notice given within 60 days after the end of an applicable calendar year for a performance reason, as defined therein, and (iv) by written notice during the 12 months following a change of control of RMR LLC, as defined therein. RMR LLC has the right to terminate the management agreements for good reason, as defined therein. • Termination Fee . If we terminate one or both of our management agreements with RMR LLC for convenience, or if RMR LLC terminates one or both of our management agreements for good reason, we have agreed to pay RMR LLC a termination fee in an amount equal to the sum of the present values of the monthly future fees, as defined therein, for the terminated management agreement(s) for the term that was remaining prior to such termination, which, depending on the time of termination, would be between 19 and 20 years. If we terminate one or both of our management agreements with RMR LLC for a performance reason, we have agreed to pay RMR LLC the termination fee calculated as described above, but assuming a 10 year term was remaining prior to the termination. We are not required to pay any termination fee if we terminate our management agreements with RMR LLC for cause or as a result of a change of control of RMR LLC. • Transition Services . RMR LLC has agreed to provide certain transition services to us for 120 days following an applicable termination by us or notice of termination by RMR LLC, including cooperating with us and using commercially reasonable efforts to facilitate the orderly transfer of the management and real estate investment services provided under our business management agreement and to facilitate the orderly transfer of the management of the managed properties under our property management agreement, as applicable. • Vendors . Pursuant to our management agreements with RMR LLC, RMR LLC may from time to time negotiate on our behalf with certain third party vendors and suppliers for the procurement of goods and services to us. As part of this arrangement, we may enter agreements with RMR LLC and other companies to which RMR LLC or its subsidiaries provide management services for the purpose of obtaining more favorable terms from such vendors and suppliers. • Investment Opportunities . Under our business management agreement with RMR LLC, we acknowledge that RMR LLC may engage in other activities or businesses and act as the manager to any other person or entity (including other REITs) even though such person or entity has investment policies and objectives similar to ours and we are not entitled to preferential treatment in receiving information, recommendations and other services from RMR LLC. Note 6. Related Person Transactions We have relationships and historical and continuing transactions with SIR (prior to the SIR Merger), RMR LLC, RMR Inc., and others related to them, including other companies to which RMR LLC or its subsidiaries provide management services and some of which have trustees, directors or officers who are also our Trustees or officers. RMR LLC is a majority owned subsidiary of RMR Inc. The Chair of our Board of Trustees and one of our Managing Trustees, Adam Portnoy, is the sole trustee, an officer and the controlling shareholder of ABP Trust, which is the controlling shareholder of RMR Inc., a managing director, the president and chief executive officer of RMR Inc. and an officer and employee of RMR LLC. David Blackman resigned as our President and Chief Executive Officer, effective December 31, 2020. Mr. Blackman will remain in his position as our Managing Trustee, until June 30, 2021 or such earlier date as his successor Managing Trustee is elected to our Board. In replacement of Mr. Blackman, Christopher J. Bilotto was appointed as our President and Chief Operating Officer, effective January 1, 2021. Mr. Bilotto previously served as our Vice President and Chief Operating Officer, and he is an officer and employee of RMR LLC. In addition, each of our other officers is also an officer and employee of RMR LLC. Some of our F-24 Table of Contents OFFICE PROPERTIES INCOME TRUST NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (dollars in thousands, except per share amounts) Independent Trustees also serve as independent trustees or independent directors of other public companies to which RMR LLC or its subsidiaries provide management services. Adam Portnoy serves as chair of the boards of trustees or boards of directors of several of these public companies and as a managing director or managing trustee of these public companies. Other officers of RMR LLC, including certain of our officers, serve as managing trustees, managing directors or officers of certain of these companies. Our Manager, RMR LLC . We have two agreements with RMR LLC to provide management services to us. See Note 5 for more information regarding our management agreements with RMR LLC. Leases with RMR LLC . We lease office space to RMR LLC in certain of our properties for RMR LLC’s property management offices. Pursuant to our lease agreements with RMR LLC, we recognized rental income from RMR LLC for leased office space of $ 1,120 , $ 1,142 and $ 1,026 for the years ended December 31, 2020, 2019 and 2018, respectively. Our office space leases with RMR LLC are terminable by RMR LLC if our management agreements with RMR LLC are terminated. Share Awards to RMR LLC Employees . As described further in Note 10, we award shares to our officers and other employees of RMR LLC annually. Generally, one fifth of these awards vest on the grant date and one fifth vests on each of the next four anniversaries of the grant dates. In certain instances, we may accelerate the vesting of an award, such as in connection with the award holder’s retirement as an officer of us or an officer or employee of RMR LLC. These awards to RMR LLC employees are in addition to the share awards to our Managing Trustees, as Trustee compensation, and the fees we paid to RMR LLC. See Note 10 for more information regarding our share awards and activity as well as certain share purchases we made in connection with share award recipients satisfying tax withholding obligations on vesting share awards. RMR Inc. On July 1, 2019, we sold all of the 2,801,060 shares of class A common stock of RMR Inc. that we owned in an underwritten public offering at a price to the public of $ 40.00 per share pursuant to an underwriting agreement among us, RMR Inc., certain other REITs managed by RMR LLC that also sold their class A common stock of RMR Inc. in the offering and the underwriters named therein. We received net proceeds of $ 104,674 from this sale, after deducting underwriting discounts and commissions and other offering expenses. SIR . As described further in Note 1, we completed the SIR Merger effective December 31, 2018. See Notes 3, 11 and 12 for more information regarding the SIR Merger and our former equity method investment in SIR. AIC . Until its dissolution on February 13, 2020, we, ABP Trust and five other companies to which RMR LLC provides management services owned AIC in equal portions. We and the other AIC shareholders historically participated in a combined property insurance program arranged and insured or reinsured in part by AIC until June 30, 2019. We paid aggregate annual premiums, including taxes and fees, of $ 1,211 and $ 757 in connection with this insurance program for the policy years ended June 30, 2019 and 2018, respectively. Properties we acquired as a result of the SIR Merger were already previously included in this insurance program because SIR was a participant in the program. SIR paid an annual premium, including taxes and fees, of $ 1,666 in connection with this insurance program for the policy year ended June 30, 2019. In connection with AIC’s dissolution, we and each other AIC shareholder received an initial liquidating distribution of $ 9,000 from AIC in December 2019 and an additional liquidating distribution of $ 287 in June 2020. See Note 2 for more information regarding our investment in AIC. Note 7. Concentration Tenant and Credit Concentration We define annualized rental income as the annualized contractual base rents from our tenants pursuant to our lease agreements as of the measurement date, plus straight line rent adjustments and estimated recurring expense reimbursements to be paid to us, and excluding lease value amortization. As of December 31, 2020 and 2019, the U.S. government, 11 state governments, and two other government tenants combined were responsible for approximately 35.3 % and 35.5 % of our annualized rental income, respectively. As of December 31, 2018, the U.S. government, 13 state governments and three other government tenants combined were responsible for approximately 35.4 % of our annualized rental income. The U.S. government is our largest tenant by annualized rental income and represented approximately 25.2 %, 25.0 % and 25.6 % of our annualized rental income as of December 31, 2020, 2019 and 2018, respectively. F-25 Table of Contents OFFICE PROPERTIES INCOME TRUST NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (dollars in thousands, except per share amounts) Geographic Concentration At December 31, 2020, our 181 wholly owned properties were located in 34 states and the District of Columbia. Properties located in Virginia, California, the District of Columbia, Texas and Maryland were responsible for approximately 14.5 %, 12.3 %, 10.9 %, 8.3 %, and 6.6 % of our annualized rental income as of December 31, 2020, respectively. Note 8. Indebtedness At December 31, 2020 and 2019, our outstanding indebtedness consisted of the following: December 31, 2020 2019 Revolving credit facility, due in 2023 $ — $ — Senior unsecured notes, 3.600 % interest rate, due in 2020 (1) — 400,000 Senior unsecured notes, 4.150 % interest rate, due in 2022 (1) 300,000 300,000 Senior unsecured notes, 4.000 % interest rate, due in 2022 300,000 300,000 Senior unsecured notes, 4.250 % interest rate, due in 2024 (1) 350,000 350,000 Senior unsecured notes, 4.500 % interest rate, due in 2025 (1) (2) 650,000 400,000 Senior unsecured notes, 5.875 % interest rate, due in 2046 310,000 310,000 Senior unsecured notes, 6.375 % interest rate, due in 2050 162,000 — Mortgage note payable, 5.720 % interest rate, due in 2020 — 32,888 Mortgage note payable, 4.160 % interest rate, due in 2020 (1) — 40,062 Mortgage note payable, 8.150 % interest rate, due in 2021 350 1,683 Mortgage note payable, 5.877 % interest rate, due in 2021 (3) — 13,166 Mortgage note payable, 4.220 % interest rate, due in 2022 25,804 26,522 Mortgage note payable, 3.550 % interest rate, due in 2023 (1) 71,000 71,000 Mortgage note payable, 3.700 % interest rate, due in 2023 (1) 50,000 50,000 Mortgage note payable, 4.800 % interest rate, due in 2023 23,688 24,108 Mortgage note payable, 4.050 % interest rate, due in 2030 — 66,780 2,242,842 2,386,209 Unamortized debt premiums, discounts and issuance costs ( 39,871 ) ( 45,756 ) $ 2,202,971 $ 2,340,453 (1) We assumed these senior unsecured notes and mortgage notes in connection with the SIR Merger. (2) An additional $ 250,000 of these senior unsecured notes were issued in September 2020. (3) The carrying value of this mortgage note of $ 13,128 as of December 31, 2019 is net of unamortized issuance costs of $ 38 and is included in liabilities of properties held for sale in our consolidated balance sheet as of December 31, 2019. This mortgage note was secured by a property in Fairfax, VA that was sold in March 2020. The mortgage note was repaid at the closing of that property sale. Our $ 750,000 revolving credit facility is governed by a credit agreement, or our credit agreement, with a syndicate of institutional lenders that includes a feature under which the maximum aggregate borrowing availability may be increased to up to $ 1,950,000 in certain circumstances. F-26 Table of Contents OFFICE PROPERTIES INCOME TRUST NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (dollars in thousands, except per share amounts) Our $ 750,000 revolving credit facility is available for general business purposes, including acquisitions. The maturity date of our revolving credit facility is January 31, 2023 and, subject to our payment of an extension fee and meeting certain other conditions, we have the option to extend the stated maturity date of our revolving credit facility by two additional six month periods. We can borrow, repay and reborrow funds available under our revolving credit facility until maturity and no principal repayment is due until maturity. We are required to pay interest at a rate of LIBOR plus a premium, which was 110 basis points per annum at December 31, 2020, on the amount outstanding under our revolving credit facility. We also pay a facility fee on the total amount of lending commitments under our revolving credit facility, which was 25 basis points per annum at December 31, 2020. Both the interest rate premium and facility fee are subject to adjustment based upon changes to our credit ratings. As of December 31, 2020 and 2019, the annual interest rate payable on borrowings under our revolving credit facility was 1.2 % and 2.7 %, respectively. The weighted average annual interest rate for borrowings under our revolving credit facility was 2.0 %, 3.3 % and 3.0 %, for the years ended December 31, 2020, 2019 and 2018, respectively. As of December 31, 2020 and February 18, 2021, we had no amounts outstanding under our revolving credit facility and $ 750,000 available for borrowing. Our credit agreement and senior unsecured notes indentures and their supplements provide for acceleration of payment of all amounts due thereunder upon the occurrence and continuation of certain events of default, such as, in the case of our credit agreement, a change of control of us, which includes RMR LLC ceasing to act as our business and property manager. Our credit agreement and senior unsecured notes indentures and their supplements also contain covenants, including covenants that restrict our ability to incur debts, require us to comply with certain financial covenants and, in the case of our credit agreement, restrict our ability to make distributions under certain circumstances. We believe we were in compliance with the terms and conditions of the respective covenants under our credit agreement and senior unsecured notes indentures and their supplements at December 31, 2020. Senior Unsecured Note Issuances In June and July 2020, we issued an aggregate of $ 162,000 of 6.375 % senior unsecured notes due 2050 in an underwritten public offering. Our aggregate net proceeds from this offering were $ 156,226 , after underwriters’ discounts and offering expenses. These notes require quarterly payments of interest only through maturity and may be repaid at par (plus accrued and unpaid interest) on or after June 23, 2025. In September 2020, we issued $ 250,000 of our 4.50 % senior unsecured notes due 2025 in an underwritten public offering. These notes are a further issuance of our existing $ 400,000 of senior unsecured notes due 2025 that were initially issued by SIR in February 2015, which we assumed in connection with the SIR Merger. The public offering price of these notes was 101.414 % of the principal amount, raising net proceeds of $ 251,214 , after underwriters’ discounts and estimated offering expenses. These notes require semi-annual payments of interest only through maturity. Senior Unsecured Note Redemption In January 2020, we redeemed, at par plus accrued interest, all $ 400,000 of our 3.60 % senior unsecured notes due 2020. As a result of the redemption of our 3.60 % senior unsecured notes due 2020, we recognized a loss on early extinguishment of debt of $ 61 during the year ended December 31, 2020, to write off unamortized debt discounts. Mortgage Note Repayments In March 2020, in connection with the sale of one property, we prepaid, at a premium plus accrued interest, a mortgage note secured by that property with an outstanding principal balance of $ 13,095 , an annual interest rate of 5.9 % and a maturity date in August 2021, which was classified in liabilities of properties held for sale in our consolidated balance sheet as of December 31, 2019. As a result of the prepayment of this mortgage note, we recognized a loss on early extinguishment of debt of $ 508 during the year ended December 31, 2020, from a prepayment penalty and the write off of unamortized debt issuance costs. Also in March 2020, we prepaid, at a premium plus accrued interest, a mortgage note secured by one property with an outstanding principal balance of $ 66,780 , an annual interest rate of 4.0 % and a maturity date in September 2030. As a result of the prepayment of this mortgage note, we recognized a loss on early extinguishment of debt of $ 2,713 during the year ended December 31, 2020, from a prepayment penalty and the write off of unamortized debt discounts. In April 2020, we prepaid, at par plus accrued interest, a mortgage note secured by one property with an outstanding principal balance of $ 32,677 , an annual interest rate of 5.7 % and a maturity date in July 2020. As a result of the prepayment of F-27 Table of Contents OFFICE PROPERTIES INCOME TRUST NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (dollars in thousands, except per share amounts) this mortgage note, we recognized a gain on early extinguishment of debt of $ 163 during the year ended December 31, 2020, from the write off of unamortized debt premiums. In August 2020, we repaid at maturity, at par plus accrued interest, a mortgage note secured by one property with an outstanding principal balance of $ 39,635 and an annual interest rate of 2.2 %. At December 31, 2020, seven of our properties with an aggregate net book value of $ 304,227 were encumbered by mortgage notes with an aggregate principal amount of $ 170,842 . Our mortgage notes are non-recourse, subject to certain limited exceptions and do not contain any material financial covenants. None of our unsecured debt obligations require sinking fund payments prior to their maturity dates. The required principal payments due during the next five years and thereafter under all our outstanding consolidated debt as of December 31, 2020 are as follows: Year Principal Payment 2021 $ 1,540 2022 625,518 2023 143,784 2024 350,000 2025 650,000 Thereafter 472,000 Total $ 2,242,842 (1) (1) Total consolidated debt outstanding as of December 31, 2020, net of unamortized premiums, discounts and issuance costs totaling $ 39,871 , was $ 2,202,971 . F-28 Table of Contents OFFICE PROPERTIES INCOME TRUST NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (dollars in thousands, except per share amounts) Note 9. Fair Value of Assets and Liabilities Our financial instruments include our cash and cash equivalents, restricted cash, rents receivable, accounts payable, a revolving credit facility, senior unsecured notes, mortgage notes payable, amounts due to related persons, other accrued expenses and security deposits. At December 31, 2020 and 2019, the fair values of our financial instruments approximated their carrying values in our consolidated financial statements, due to their short term nature or floating interest rates, except as follows: As of December 31, 2020 As of December 31, 2019 Financial Instrument Carrying Value (1) Fair Value Carrying Value (1) Fair Value Senior unsecured notes, 3.60 % interest rate, due in 2020 (2) $ — $ — $ 399,934 $ 400,048 Senior unsecured notes, 4.15 % interest rate, due in 2022 298,853 306,192 297,795 307,221 Senior unsecured notes, 4.00 % interest rate, due in 2022 298,579 306,756 297,657 306,096 Senior unsecured notes, 4.25 % interest rate, due in 2024 342,299 365,435 340,018 364,602 Senior unsecured notes, 4.50 % interest rate, due in 2025 (3) 635,921 688,399 381,055 419,578 Senior unsecured notes, 5.875 % interest rate, due in 2046 301,264 322,028 300,920 322,028 Senior unsecured notes, 6.375 % interest rate, due in 2050 (4) 156,326 171,590 — — Mortgage notes payable (5) 169,729 174,952 323,074 331,675 Total $ 2,202,971 $ 2,335,352 $ 2,340,453 $ 2,451,248 (1) Includes unamortized debt premiums, discounts and issuance costs totaling $ 39,871 and $ 45,756 as of December 31, 2020 and 2019, respectively. (2) These senior unsecured notes were redeemed in January 2020. (3) An additional $ 250,000 of these senior unsecured notes were issued in September 2020. (4) $ 150,000 of these senior unsecured notes were issued in June 2020. In July 2020, we issued an additional $ 12,000 of these senior unsecured notes in connection with the underwriters’ partial exercise of their option to purchase additional notes. (5) Balance as of December 31, 2019 includes one mortgage note with a carrying value of $ 13,128 net of unamortized issuance costs totaling $ 38 which is classified in liabilities of properties held for sale in our consolidated balance sheet. This mortgage note was secured by a property in Fairfax, VA that was sold in March 2020. The mortgage note was repaid at closing. We estimated the fair values of our senior unsecured notes (except for our senior unsecured notes due 2046 and 2050) using an average of the bid and ask price of the notes (Level 2 inputs as defined in the fair value hierarchy under GAAP) as of the measurement date. We estimated the fair values of our senior unsecured notes due 2046 and 2050 based on the closing price on Nasdaq (Level 1 inputs as defined in the fair value hierarchy under GAAP) as of the measurement date. We estimated the fair values of our mortgage notes payable using discounted cash flow analyses and currently prevailing market rates (Level 3 inputs as defined in the fair value hierarchy under GAAP) as of the measurement date. Because Level 3 inputs are unobservable, our estimated fair values may differ materially from the actual fair values. Note 10. Shareholders’ Equity Share Awards We have common shares available for issuance under the terms of our Amended and Restated 2009 Incentive Share Award Plan, or the 2009 Plan. During the years ended December 31, 2020, 2019 and 2018, we awarded to our officers and other employees of RMR LLC annual share awards of 108,600 , 103,100 and 14,675 of our common shares, respectively, valued at $ 2,502 , $ 3,080 and $ 995 , in aggregate, respectively. We also awarded each of our eight Trustees 3,500 and 3,000 of our common shares in 2020 and 2019, respectively, with aggregate values of $ 745 ($ 93 per Trustee) and $ 575 ($ 72 per Trustee), respectively, and each of our then six Trustees 750 of our common shares in 2018 with an aggregate value of $ 254 ($ 42 per Trustee), as part of their annual compensation. In addition, we awarded 3,000 of our common shares, with a value of $ 270 ($ 90 per Trustee) in connection with the election of three of our Trustees in 2019 and 750 of our common shares, with a value of $ 41 in connection with the election of one of our Trustees in 2018. The values of the share awards were based upon the closing price of our common shares trading on Nasdaq on the date of grant. The common shares awarded to our Trustees vested immediately. The common shares awarded to our officers and certain other employees of RMR LLC vest in five equal annual installments beginning on the date of award. We recognize share forfeitures as they occur. We include the value of awarded shares in general and administrative expenses ratably over the vesting period. F-29 Table of Contents OFFICE PROPERTIES INCOME TRUST NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (dollars in thousands, except per share amounts) A summary of shares awarded, forfeited, vested and unvested under the terms of the 2009 Plan for the years ended December 31, 2020, 2019 and 2018, is as follows: 2020 2019 2018 Number of Shares Weighted Average Grant Date Fair Value Number of Shares Weighted Average Grant Date Fair Value Number of Shares Weighted Average Grant Date Fair Value Unvested at beginning of year 106,680 $ 40.16 55,321 $ 73.25 26,062 $ 78.24 Awarded 136,600 $ 23.77 136,100 $ 28.84 19,925 $ 64.73 Forfeited ( 586 ) $ 43.75 ( 1,474 ) $ 49.10 ( 255 ) $ 52.96 Vested ( 85,173 ) $ 34.02 ( 83,267 ) $ 27.78 ( 18,634 ) $ 63.80 Unvested acquired in the SIR Merger (1) — $ — — $ — 28,223 $ 27.48 Unvested at end of year 157,521 $ 29.26 106,680 $ 40.16 55,321 $ 73.25 (1) Represents unvested shares awarded under SIR’s equity compensation plan that were converted into shares under the 2009 Plan, and which have similar vesting requirements as shares granted under the 2009 Plan. The 157,521 unvested shares as of December 31, 2020 are scheduled to vest as follows: 67,994 shares in 2021, 37,267 shares in 2022, 33,940 shares in 2023 and 18,320 shares in 2024. As of December 31, 2020, the estimated future compensation expense for the unvested shares was $ 3,338 . The weighted average period over which the compensation expense will be recorded is approximately 21 months. During the years ended December 31, 2020, 2019 and 2018, we recorded $ 3,315 , $ 3,088 and $ 1,337 , respectively, of compensation expense related to the 2009 Plan. At December 31, 2020, 1,094,909 of our common shares remained available for issuance under the 2009 Plan. Share Purchases During the years ended December 31, 2020, 2019 and 2018, we purchased 19,589 , 15,588 and 4,984 of our common shares, respectively, at weighted average prices of $ 22.15 , $ 29.76 and $ 46.54 per common share, respectively, from our Trustees and current and former officers and employees of RMR LLC in satisfaction of tax withholding and payment obligations in connection with the vesting of awards of our common shares. Distributions During the years ended December 31, 2020, 2019 and 2018, we paid distributions on our common shares as follows: Annual Per Share Distribution Total Distributions Characterization of Distributions Year Return of Capital Ordinary Income Qualified Dividend 2020 $ 2.20 $ 106,121 — % 100.00 % — % 2019 $ 2.20 $ 105,868 — % 100.00 % — % 2018 $ 6.88 $ 170,566 68.60 % 31.40 % — % On January 14, 2021, we declared a dividend payable to common shareholders of record on January 25, 2021 in the amount of $ 0.55 per share, or $ 26,575 . We paid this distribution on February 18, 2021. Preferred Units of Limited Partnership On May 1, 2018, one of our subsidiaries redeemed all 1,813,504 of its outstanding 5.5 % Series A Cumulative Preferred Units for $ 11.15 per unit plus accrued and unpaid distributions (an aggregate of $ 20,310 ). F-30 Table of Contents OFFICE PROPERTIES INCOME TRUST NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (dollars in thousands, except per share amounts) Note 11. Equity Investment in Select Income REIT Until October 9, 2018, we owned 24,918,421 , or approximately 27.8 %, of the then outstanding SIR common shares. As described in Note 1, we completed the Secondary Sale on that date. As a result of the Secondary Sale, we recorded a loss of $ 18,665 during the year ended December 31, 2018. We accounted for our investment in SIR under the equity method and had previously reported our investment in SIR as a reportable segment. As a result of the Secondary Sale and the elimination of a reportable segment, our former equity method investment in SIR is classified as discontinued operations in our consolidated statements of comprehensive income (loss). See Note 12 for more information regarding discontinued operations. Under the equity method, we recorded our proportionate share of SIR’s net income as equity in earnings of SIR in our consolidated statements of comprehensive income (loss). During the period from January 1, 2018 to October 9, 2018, we recorded $ 24,358 of equity in earnings of SIR. Our other comprehensive income (loss) includes our proportionate share of SIR’s unrealized gains of $ 28 for the period from January 1, 2018 to October 9, 2018. The adjusted GAAP cost basis of our investment in SIR was less than our proportionate share of SIR’s total shareholders’ equity book value on the dates we acquired the shares. Prior to the Secondary Sale, we were accreting a basis difference to earnings over the estimated remaining useful lives of certain real estate assets and intangible assets and liabilities owned by SIR. This accretion increased our equity in the earnings of SIR by $ 3,233 for the period from January 1, 2018 to October 9, 2018. During the period from January 1, 2018 to October 9, 2018, we received cash distributions from SIR totaling $ 38,124 . During the period from January 1, 2018 to October 9, 2018, SIR issued 63,157 common shares. We recognized a gain on issuance of shares by SIR of $ 29 during the period from January 1, 2018 to October 9, 2018, as a result of the per share issuance price of these SIR common shares being above the then average per share carrying value of our SIR common shares. F-31 Table of Contents OFFICE PROPERTIES INCOME TRUST NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (dollars in thousands, except per share amounts) The following table presents summarized income statement data of SIR: Nine Months Ended September 30, 2018 Revenues: Rental income $ 298,003 Tenant reimbursements and other income 60,514 Total revenues 358,517 Expenses: Real estate taxes 36,748 Other operating expenses 43,714 Depreciation and amortization 105,326 Acquisition and transaction related costs 3,796 General and administrative 47,353 Write-off of straight line rent receivable, net 10,626 Loss on impairment of real estate assets 9,706 Total expenses 257,269 Gain on sale of real estate 4,075 Dividend income 1,190 Unrealized gain on equity securities 53,159 Interest income 753 Interest expense ( 69,446 ) Loss on early extinguishment of debt ( 1,192 ) Income before income tax expense and equity in earnings of an investee 89,787 Income tax expense ( 446 ) Equity in earnings of an investee 882 Net income 90,223 Net income allocated to noncontrolling interest ( 15,841 ) Net income attributed to SIR $ 74,382 Weighted average common shares outstanding (basic) 89,395 Weighted average common shares outstanding (diluted) 89,411 Net income attributed to SIR per common share (basic and diluted) $ 0.83 F-32 Table of Contents OFFICE PROPERTIES INCOME TRUST NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (dollars in thousands, except per share amounts) Note 12. Discontinued Operations As described in Note 1, on October 9, 2018, we sold all 24,918,421 SIR common shares that we then owned in the Secondary Sale. We recorded a loss of $ 18,665 during the year ended December 31, 2018 related to this sale. The sale of our SIR common shares qualifies as discontinued operations; accordingly, our former equity method investment in SIR is classified as discontinued operations in our consolidated statements of comprehensive income (loss). The following table presents the components of income from discontinued operations for the year ended December 31, 2018: Year Ended December 31, 2018 Equity in earnings of Select Income REIT $ 24,358 Net gain on issuance of shares by Select Income REIT 29 Loss on sale of Select Income REIT shares ( 18,665 ) Income from discontinued operations $ 5,722 F-33 Table of Contents OFFICE PROPERTIES INCOME TRUST SCHEDULE III REAL ESTATE AND ACCUMULATED DEPRECIATION December 31, 2020 (dollars in thousands) Initial Cost to Company Costs Capitalized Subsequent to Acquisition Cost amount carried at Close of Period Property Location Number of Properties Encumbrances (1) Land Buildings and Equipment Impairments/ Writedowns Land Buildings and Equipment Total (2) Accumulated Depreciation (3) Date(s) Acquired Original Construction Date(s) Inverness Center Birmingham, AL 3 $ — $ 5,907 $ 12,098 $ 1,570 $ — $ 5,907 $ 13,668 $ 19,575 $ ( 946 ) 12/31/2018 1984 445 Jan Davis Drive Huntsville, AL 1 — 1,501 1,492 — — 1,501 1,492 2,993 ( 80 ) 12/31/2018 2007 4905 Moores Mill Road Huntsville, AL 1 — 4,592 36,324 2,486 — 4,592 38,810 43,402 ( 2,268 ) 12/31/2018 1979 131 Clayton Street Montgomery, AL 1 — 920 9,084 230 — 920 9,314 10,234 ( 2,189 ) 6/22/2011 2007 4344 Carmichael Road Montgomery, AL 1 — 1,374 11,658 562 — 1,374 12,220 13,594 ( 2,081 ) 12/17/2013 2009 15451 North 28th Avenue Phoenix, AZ 1 — 1,917 7,416 722 — 1,917 8,138 10,055 ( 1,282 ) 9/10/2014 1996 16001 North 28th Avenue Phoenix, AZ 1 — 3,355 412 674 — 3,355 1,086 4,441 ( 62 ) 12/31/2018 1998 711 S 14th Avenue Safford, AZ 1 — 460 11,708 793 ( 4,440 ) 364 8,157 8,521 ( 753 ) 6/16/2010 1992 Regents Center Tempe, AZ 2 — 4,121 3,042 170 — 4,121 3,212 7,333 ( 306 ) 12/31/2018 1988 Campbell Place Carlsbad, CA 2 — 5,769 3,871 7,484 — 5,769 11,355 17,124 ( 517 ) 12/31/2018 2007 Folsom Corporate Center Folsom, CA 1 — 2,904 5,583 568 — 2,904 6,151 9,055 ( 354 ) 12/31/2018 2008 Bayside Technology Park Fremont, CA 1 — 10,784 648 87 — 10,784 735 11,519 ( 45 ) 12/31/2018 1990 5045 East Butler Street Fresno, CA 1 — 7,276 61,118 175 — 7,276 61,293 68,569 ( 28,101 ) 8/29/2002 1971 10949 N. Mather Boulevard Rancho Cordova, CA 1 — 562 16,923 992 — 562 17,915 18,477 ( 3,152 ) 10/30/2013 2012 11020 Sun Center Drive Rancho Cordova, CA 1 — 1,466 8,797 1,405 — 1,466 10,202 11,668 ( 1,145 ) 12/20/2016 1983 100 Redwood Shores Parkway Redwood City, CA 1 — 14,454 7,721 — — 14,454 7,721 22,175 ( 429 ) 12/31/2018 1993 3875 Atherton Road Rocklin, CA 1 — 177 853 — — 177 853 1,030 ( 47 ) 12/31/2018 1991 801 K Street Sacramento, CA 1 — 4,688 61,994 5,816 — 4,688 67,810 72,498 ( 8,674 ) 1/29/2016 1989 9815 Goethe Road Sacramento, CA 1 — 1,450 9,465 1,494 — 1,450 10,959 12,409 ( 2,538 ) 9/14/2011 1992 Capitol Place Sacramento, CA 1 — 2,290 35,891 7,882 — 2,290 43,773 46,063 ( 11,442 ) 12/17/2009 1988 4560 Viewridge Road San Diego, CA 1 — 4,269 18,316 4,478 — 4,347 22,716 27,063 ( 12,270 ) 3/31/1997 1996 2115 O’Nel Drive San Jose, CA 1 — 12,305 5,062 — — 12,305 5,062 17,367 ( 281 ) 12/31/2018 1984 North First Street San Jose, CA 1 — 8,311 4,003 411 — 8,311 4,414 12,725 ( 261 ) 12/31/2018 1984 Rio Robles Drive San Jose, CA 3 — 23,687 13,698 3,126 — 23,687 16,824 40,511 ( 906 ) 12/31/2018 1984 2450 and 2500 Walsh Avenue Santa Clara, CA 2 — 13,374 16,651 150 — 13,374 16,801 30,175 ( 923 ) 12/31/2018 1982 3250 and 3260 Jay Street Santa Clara, CA 2 — 19,899 14,051 — — 19,899 14,051 33,950 ( 779 ) 12/31/2018 1982 603 San Juan Avenue Stockton, CA 1 — 563 5,470 — — 563 5,470 6,033 ( 1,151 ) 7/20/2012 2012 350 West Java Drive Sunnyvale, CA 1 — 24,609 462 21 — 24,609 483 25,092 ( 29 ) 12/31/2018 1984 7958 South Chester Street Centennial, CO 1 — 6,682 7,153 261 — 6,682 7,414 14,096 ( 411 ) 12/31/2018 2000 S-1 Table of Contents OFFICE PROPERTIES INCOME TRUST SCHEDULE III REAL ESTATE AND ACCUMULATED DEPRECIATION (Continued) December 31, 2020 (dollars in thousands) Initial Cost to Company Costs Capitalized Subsequent to Acquisition Cost amount carried at Close of Period Property Location Number of Properties Encumbrances (1) Land Buildings and Equipment Impairments/ Writedowns Land Buildings and Equipment Total (2) Accumulated Depreciation (3) Date(s) Acquired Original Construction Date(s) 350 Spectrum Loop Colorado Springs, CO 1 — 3,650 7,732 86 — 3,650 7,818 11,468 ( 442 ) 12/31/2018 2000 333 Inverness Drive South Englewood, CO 1 — 5,711 4,543 — — 5,711 4,543 10,254 ( 272 ) 12/31/2018 1998 12795 West Alameda Parkway Lakewood, CO 1 350 2,640 23,777 1,357 — 2,640 25,134 27,774 ( 6,851 ) 1/15/2010 1988 Corporate Center Lakewood, CO 3 — 2,887 27,537 4,041 — 2,887 31,578 34,465 ( 14,329 ) 10/11/2002 1980 11 Dupont Circle, NW Washington, DC 1 — 28,255 44,743 10,534 — 28,255 55,277 83,532 ( 5,020 ) 10/2/2017 1974 1211 Connecticut Avenue, NW Washington, DC 1 25,816 30,388 24,667 2,880 — 30,388 27,547 57,935 ( 2,707 ) 10/2/2017 1967 1401 K Street, NW Washington, DC 1 23,966 29,215 34,656 5,542 — 29,215 40,198 69,413 ( 4,432 ) 10/2/2017 1929 20 Massachusetts Avenue Washington, DC 1 — 12,009 51,527 25,957 — 12,229 77,264 89,493 ( 38,812 ) 3/31/1997 1996 440 First Street, NW Washington, DC 1 — 27,903 38,624 1,459 — 27,903 40,083 67,986 ( 3,418 ) 10/2/2017 1982 625 Indiana Avenue Washington, DC 1 — 26,000 25,955 8,596 — 26,000 34,551 60,551 ( 8,440 ) 8/17/2010 1989 840 First Street, NE Washington, DC 1 — 42,727 73,278 3,470 — 42,727 76,748 119,475 ( 6,462 ) 10/2/2017 2003 10350 NW 112th Avenue Miami, FL 1 — 4,798 2,757 178 — 4,798 2,935 7,733 ( 153 ) 12/31/2018 2002 7850 Southwest 6th Court Plantation, FL 1 — 4,800 30,592 352 — 4,800 30,944 35,744 ( 7,451 ) 5/12/2011 1999 8900 Grand Oak Circle Tampa, FL 1 — 1,100 11,773 536 — 1,100 12,309 13,409 ( 3,097 ) 10/15/2010 1994 180 Ted Turner Drive SW Atlanta, GA 1 — 5,717 20,017 310 — 5,717 20,327 26,044 ( 4,279 ) 7/25/2012 2007 Corporate Square Atlanta, GA 5 — 3,996 29,762 27,503 — 3,996 57,265 61,261 ( 16,602 ) 7/16/2004 1967 Executive Park Atlanta, GA 1 — 1,521 11,826 4,071 — 1,521 15,897 17,418 ( 7,096 ) 7/16/2004 1972 One Georgia Center Atlanta, GA 1 — 10,250 27,933 12,687 — 10,250 40,620 50,870 ( 8,194 ) 9/30/2011 1968 One Primerica Parkway Duluth, GA 1 — 6,927 22,951 — — 6,927 22,951 29,878 ( 1,272 ) 12/31/2018 2013 4712 Southpark Boulevard Ellenwood, GA 1 — 1,390 19,635 118 — 1,390 19,753 21,143 ( 4,152 ) 7/25/2012 2005 91-209 Kuhela Street Kapolei, HI 1 — 1,998 — 3 — 1,992 9 2,001 — 12/31/2018 Land 8305 NW 62nd Avenue Johnston, IA 1 — 2,649 7,997 — — 2,649 7,997 10,646 ( 443 ) 12/31/2018 2011 1185, 1249 & 1387 S. Vinnell Way Boise, ID 3 — 3,390 29,026 1,025 — 3,390 30,051 33,441 ( 6,242 ) 9/11/2012 1996; 1997; 2002 2020 S. Arlington Heights Arlington Heights, IL 1 — 1,450 13,588 451 — 1,450 14,039 15,489 ( 3,833 ) 12/29/2009 1988 400 South Jefferson Street Chicago, IL 1 49,505 19,379 20,115 384 — 19,379 20,499 39,878 ( 1,126 ) 12/31/2018 1947 1415 West Diehl Road Naperville, IL 1 — 12,333 20,586 5,787 — 12,333 26,373 38,706 ( 1,339 ) 12/31/2018 2001 440 North Fairway Drive Vernon Hills, IL 1 — 4,465 441 — — 4,465 441 4,906 ( 25 ) 12/31/2018 1,992 7601 and 7635 Interactive Way Indianapolis, IN 2 — 3,337 14,522 26 — 3,337 14,548 17,885 ( 756 ) 12/31/2018 2003 S-2 Table of Contents OFFICE PROPERTIES INCOME TRUST SCHEDULE III REAL ESTATE AND ACCUMULATED DEPRECIATION (Continued) December 31, 2020 (dollars in thousands) Initial Cost to Company Costs Capitalized Subsequent to Acquisition Cost amount carried at Close of Period Property Location Number of Properties Encumbrances (1) Land Buildings and Equipment Impairments/ Writedowns Land Buildings and Equipment Total (2) Accumulated Depreciation (3) Date(s) Acquired Original Construction Date(s) Intech Park Indianapolis, IN 3 — 4,170 69,759 7,742 — 4,170 77,501 81,671 ( 18,042 ) 10/14/2011 2000; 2001; 2008 The Atrium at Circleport II Erlanger, KY 1 — 1,796 1,933 578 — 1,796 2,511 4,307 ( 167 ) 12/31/2018 1999 7125 Industrial Road Florence, KY 1 — 1,698 11,722 293 — 1,698 12,015 13,713 ( 2,393 ) 12/31/2012 1980 251 Causeway Street Boston, MA 2 — 10,748 26,539 3,008 — 10,748 29,547 40,295 ( 5,130 ) 8/17/2010 1987 300 and 330 Billerica Road Chelmsford, MA 2 — 4,700 — 6,959 — 4,700 6,959 11,659 ( 20 ) 12/31/2018 1984 75 Pleasant Street Malden, MA 1 — 1,050 31,086 857 — 1,050 31,943 32,993 ( 8,439 ) 5/24/2010 2008 25 Newport Avenue Quincy, MA 1 — 2,700 9,199 1,879 — 2,700 11,078 13,778 ( 2,915 ) 2/16/2011 1985 One Montvale Avenue Stoneham, MA 1 — 1,670 11,035 3,415 — 1,670 14,450 16,120 ( 3,404 ) 6/16/2010 1945 314 Littleton Road Westford, MA 1 — 5,691 8,487 47 — 5,691 8,534 14,225 ( 477 ) 12/31/2018 2007 Annapolis Commerce Center Annapolis, MD 2 — 4,057 7,665 989 — 4,057 8,654 12,711 ( 777 ) 10/2/2017 1989 4201 Patterson Avenue Baltimore, MD 1 — 901 8,097 4,104 ( 85 ) 893 12,124 13,017 ( 5,844 ) 10/15/1998 1989 7001 Columbia Gateway Drive Columbia, MD 1 — 5,642 10,352 226 — 5,642 10,578 16,220 ( 613 ) 12/31/2018 2008 Hillside Center Columbia, MD 2 — 3,437 4,228 701 — 3,437 4,929 8,366 ( 451 ) 10/2/2017 2001 TenThreeTwenty Columbia, MD 1 — 3,126 16,361 1,978 — 3,126 18,339 21,465 ( 1,852 ) 10/2/2017 1982 3300 75th Avenue Landover, MD 1 — 4,110 36,371 2,721 — 4,110 39,092 43,202 ( 10,330 ) 2/26/2010 1985 2115 East Jefferson Street Rockville, MD 1 — 3,349 11,152 592 — 3,349 11,744 15,093 ( 2,112 ) 8/27/2013 1981 Redland 520/530 Rockville, MD 3 — 12,714 61,377 4,003 — 12,714 65,380 78,094 ( 5,261 ) 10/2/2017 2008 Redland 540 Rockville, MD 1 — 10,740 17,714 6,082 — 10,740 23,796 34,536 ( 3,147 ) 10/2/2017 2003 Rutherford Business Park Windsor Mill, MD 1 — 1,598 10,219 490 — 1,598 10,709 12,307 ( 2,139 ) 11/16/2012 1972 3550 Green Court Ann Arbor, MI 1 — 3,630 4,857 — — 3,630 4,857 8,487 ( 286 ) 12/31/2018 1998 11411 E. Jefferson Avenue Detroit, MI 1 — 630 18,002 544 — 630 18,546 19,176 ( 4,878 ) 4/23/2010 2009 Rosedale Corporate Plaza Roseville, MN 1 — 672 6,045 1,526 — 672 7,571 8,243 ( 4,046 ) 12/1/1999 1987 1300 Summit Street Kansas City, MO 1 — 2,776 12,070 1,145 — 2,776 13,215 15,991 ( 2,869 ) 9/27/2012 1998 2555 Grand Boulevard Kansas City, MO 1 — 4,209 51,522 2,706 — 4,209 54,228 58,437 ( 2,871 ) 12/31/2018 2003 4241 NE 34th Street Kansas City, MO 1 — 1,133 5,649 4,201 — 1,470 9,513 10,983 ( 4,670 ) 3/31/1997 1995 1220 Echelon Parkway Jackson, MS 1 — 440 25,458 345 — 440 25,803 26,243 ( 5,423 ) 7/25/2012 2009 2300 and 2400 Yorkmont Road Charlotte, NC 2 — 1,334 19,075 1,988 — 1,334 21,063 22,397 ( 1,241 ) 12/31/2018 1995 18010 and 18020 Burt Street Omaha, NE 2 — 6,977 12,500 — — 6,977 12,500 19,477 ( 693 ) 12/31/2018 2012 S-3 Table of Contents OFFICE PROPERTIES INCOME TRUST SCHEDULE III REAL ESTATE AND ACCUMULATED DEPRECIATION (Continued) December 31, 2020 (dollars in thousands) Initial Cost to Company Costs Capitalized Subsequent to Acquisition Cost amount carried at Close of Period Property Location Number of Properties Encumbrances (1) Land Buildings and Equipment Impairments/ Writedowns Land Buildings and Equipment Total (2) Accumulated Depreciation (3) Date(s) Acquired Original Construction Date(s) 500 Charles Ewing Boulevard Ewing, NJ 1 — 4,808 26,002 — — 4,808 26,002 30,810 ( 1,441 ) 12/31/2018 2012 299 Jefferson Road Parsippany, NJ 1 — 4,543 2,914 823 — 4,543 3,737 8,280 ( 221 ) 12/31/2018 2011 One Jefferson Road Parsippany, NJ 1 — 4,415 5,249 63 — 4,415 5,312 9,727 ( 289 ) 12/31/2018 2009 Airline Corporate Center Colonie, NY 1 — 790 6,400 406 — 790 6,806 7,596 ( 1,452 ) 6/22/2012 2004 5000 Corporate Court Holtsville, NY 1 — 6,530 17,711 4,103 — 6,530 21,814 28,344 ( 5,206 ) 8/31/2011 2000 8687 Carling Road Liverpool, NY 1 — 566 — 8 — 566 8 574 ( 1 ) 12/31/2018 1997 1212 Pittsford - Victor Road Pittsford, NY 1 — 608 78 538 — 608 616 1,224 ( 36 ) 12/31/2018 1965 2231 Schrock Road Columbus, OH 1 — 716 217 201 — 716 418 1,134 ( 31 ) 12/31/2018 1999 4600 25th Avenue Salem, OR 1 — 6,510 17,973 5,209 — 6,510 23,182 29,692 ( 5,016 ) 12/20/2011 1957 8800 Tinicum Boulevard Philadelphia, PA 1 — 5,573 22,686 1,325 — 5,573 24,011 29,584 ( 1,265 ) 12/31/2018 2000 446 Wrenplace Road Fort Mill, SC 1 — 5,031 22,526 — — 5,031 22,526 27,557 ( 14 ) 12/22/2020 2019 9680 Old Bailes Road Fort Mill, SC 1 — 834 2,944 — — 834 2,944 3,778 ( 163 ) 12/31/2018 2007 One Memphis Place Memphis, TN 1 — 1,630 5,645 7,407 — 1,630 13,052 14,682 ( 2,687 ) 9/17/2010 1985 16001 North Dallas Parkway Addison, TX 2 — 10,282 63,071 375 — 10,282 63,446 73,728 ( 3,750 ) 12/31/2018 1987 Research Park Austin, TX 2 — 4,258 13,747 360 — 4,258 14,107 18,365 ( 1,461 ) 12/31/2018 1999 10451 Clay Road Houston, TX 1 — 5,495 10,253 — — 5,495 10,253 15,748 ( 569 ) 12/31/2018 2013 202 North Castlegory Road Houston, TX 1 — 863 5,024 — — 863 5,024 5,887 ( 262 ) 12/31/2018 2016 6380 Rogerdale Road Houston, TX 1 — 12,628 6,113 26 — 12,628 6,139 18,767 ( 341 ) 12/31/2018 2006 4221 W. John Carpenter Freeway Irving, TX 1 — 1,413 2,365 1,843 — 1,413 4,208 5,621 ( 382 ) 12/31/2018 1995 8675,8701-8711 Freeport Pkwy and 8901 Esters Boulevard Irving, TX 3 — 10,185 31,566 62 — 10,185 31,628 41,813 ( 1,750 ) 12/31/2018 1990 1511 East Common Street New Braunfels, TX 1 — 4,965 1,266 73 — 4,965 1,339 6,304 ( 75 ) 12/31/2018 2005 2900 West Plano Parkway Plano, TX 1 — 6,819 8,831 — — 6,819 8,831 15,650 ( 490 ) 12/31/2018 1998 3400 West Plano Parkway Plano, TX 1 — 4,543 15,964 321 — 4,543 16,285 20,828 ( 910 ) 12/31/2018 1994 3600 Wiseman Boulevard San Antonio, TX 1 — 3,493 6,662 3,245 — 3,493 9,907 13,400 ( 546 ) 12/31/2018 2004 701 Clay Road Waco, TX 1 — 2,030 8,708 13,392 — 2,060 22,070 24,130 ( 5,934 ) 12/23/1997 1997 1800 Novell Place Provo, UT 1 — 7,487 43,487 — — 7,487 43,487 50,974 ( 2,602 ) 12/31/2018 2000 4885-4931 North 300 West Provo, UT 2 — 3,915 9,429 21 — 3,915 9,450 13,365 ( 555 ) 12/31/2018 2009 14660, 14672 & 14668 Lee Road Chantilly, VA 3 — 6,966 74,214 4,590 — 6,966 78,804 85,770 ( 8,024 ) 12/22/2016 1998; 2002; 2006 1434 Crossways Chesapeake, VA 2 — 3,617 19,527 2,795 — 3,617 22,322 25,939 ( 2,686 ) 10/2/2017 1998 S-4 Table of Contents OFFICE PROPERTIES INCOME TRUST SCHEDULE III REAL ESTATE AND ACCUMULATED DEPRECIATION (Continued) December 31, 2020 (dollars in thousands) Initial Cost to Company Costs Capitalized Subsequent to Acquisition Cost amount carried at Close of Period Property Location Number of Properties Encumbrances (1) Land Buildings and Equipment Impairments/ Writedowns Land Buildings and Equipment Total (2) Accumulated Depreciation (3) Date(s) Acquired Original Construction Date(s) Greenbrier Towers Chesapeake, VA 2 — 3,437 11,241 3,011 — 3,437 14,252 17,689 ( 1,781 ) 10/2/2017 1985 Enterchange at Meadowville Chester, VA 1 — 1,478 9,594 424 — 1,478 10,018 11,496 ( 1,808 ) 8/28/2013 1999 Three Flint Hill Fairfax, VA 1 — 5,991 25,536 3,021 — 5,991 28,557 34,548 ( 3,164 ) 10/2/2017 1984 7987 Ashton Avenue Manassas, VA 1 — 1,562 8,253 912 — 1,562 9,165 10,727 ( 1,006 ) 1/3/2017 1989 Two Commercial Place Norfolk, VA 1 — 4,494 21,508 480 — 4,494 21,988 26,482 ( 1,150 ) 12/31/2018 1974 1759 & 1760 Business Center Drive Reston, VA 2 — 9,066 78,658 6,969 — 9,066 85,627 94,693 ( 13,592 ) 5/28/2014 1987 1775 Wiehle Avenue Reston, VA 1 — 4,138 26,120 1,749 — 4,138 27,869 32,007 ( 2,431 ) 10/2/2017 2001 9201 Forest Hill Avenue Richmond, VA 1 — 1,344 375 451 — 1,344 826 2,170 ( 39 ) 12/31/2018 1985 9960 Mayland Drive Richmond, VA 1 — 2,614 15,930 2,885 — 2,614 18,815 21,429 ( 3,062 ) 5/20/2014 1994 Parham Place Richmond, VA 3 — 913 1,099 206 — 913 1,305 2,218 ( 73 ) 12/31/2018 1989; 2012 1751 Blue Hills Drive Roanoke, VA 1 — 2,689 7,761 — — 2,689 7,761 10,450 ( 430 ) 12/31/2018 2003 Atlantic Corporate Park Sterling, VA 2 — 5,752 29,316 2,193 — 5,752 31,509 37,261 ( 2,589 ) 10/2/2017 2008 Orbital Sciences Campus Sterling, VA 3 — 12,275 19,320 276 — 12,275 19,596 31,871 ( 1,148 ) 12/31/2018 2001 Sterling Business Park Lots 8 and 9 Sterling, VA 1 — 9,177 44,324 57 — 9,177 44,381 53,558 ( 3,602 ) 10/2/2017 2016 65 Bowdoin Street S. Burlington, VT 1 — 700 8,416 140 — 700 8,556 9,256 ( 2,307 ) 4/9/2010 2009 840 North Broadway Everett, WA 2 — 3,360 15,376 2,897 — 3,360 18,273 21,633 ( 3,604 ) 6/28/2012 1985 Stevens Center Richland, WA 2 — 3,970 17,035 5,236 — 4,042 22,199 26,241 ( 11,502 ) 3/31/1997 1995 351, 401, 501 Elliott Ave West Seattle, WA 3 70,092 26,640 52,740 2,518 — 26,640 55,258 81,898 ( 2,985 ) 12/31/2018 2000 11050 West Liberty Drive Milwaukee, WI 1 — 945 4,539 103 — 945 4,642 5,587 ( 1,116 ) 6/9/2011 2006 5353 Yellowstone Road Cheyenne, WY 1 — 1,915 8,217 1,775 — 1,950 9,957 11,907 ( 5,209 ) 3/31/1997 1995 180 $ 169,729 $ 830,222 $ 2,395,928 $ 300,518 $ ( 4,525 ) $ 830,884 $ 2,691,259 $ 3,522,143 $ ( 451,914 ) Properties Held for Sale 4300 NE 34th Street (4) Kansas City, MO — — 310 544 134 — 310 678 988 ( 198 ) 3/31/1997 1995 501 South 5th Street (5) Richmond, VA 1 — 14,767 39,101 233 — 14,767 39,334 54,101 ( 2,279 ) 12/31/2018 2009 1 — 15,077 39,645 367 — 15,077 40,012 55,089 ( 2,477 ) 181 $ 169,729 $ 845,299 $ 2,435,573 $ 300,885 $ ( 4,525 ) $ 845,961 $ 2,731,271 $ 3,577,232 $ ( 454,391 ) (1) Represents mortgage debt, net of the unamortized balance of the fair value adjustments and debt issuance costs totaling $ 1,113 . (2) Excludes the value of real estate intangibles. Aggregate cost for federal income tax purposes is approximately $ 7,059,170 . (3) Depreciation on building and improvements is provided for periods ranging up to 40 years and on equipment up to 12 years. (4) Consists of a warehouse facility adjacent to a property we own in Kansas City, MO that was sold in January 2021. (5) This property was sold in January 2021. S-5 Table of Contents OFFICE PROPERTIES INCOME TRUST SCHEDULE III REAL ESTATE AND ACCUMULATED DEPRECIATION (Continued) December 31, 2020 (dollars in thousands) An analysis of the carrying amount of real estate properties and accumulated depreciation is as follows: Real Estate Properties Accumulated Depreciation Balance at December 31, 2017 $ 2,975,721 $ 341,848 Additions 1,486,342 65,215 Loss on asset impairment ( 8,630 ) — Disposals ( 286,837 ) ( 18,740 ) Cost basis adjustment (1) ( 5,005 ) ( 5,005 ) Reclassification of assets of properties held for sale ( 216,955 ) ( 8,171 ) Balance at December 31, 2018 3,944,636 375,147 Additions 66,221 89,398 Loss on asset impairment ( 22,255 ) — Disposals ( 424,302 ) ( 64,167 ) Cost basis adjustment (1) ( 9,169 ) ( 9,169 ) Reclassification of assets of properties held for sale ( 61,900 ) ( 3,553 ) Balance at December 31, 2019 3,493,231 387,656 Additions 122,116 83,828 Loss on asset impairment ( 2,954 ) — Disposals ( 31,193 ) ( 13,125 ) Cost basis adjustment (1) ( 3,968 ) ( 3,968 ) Reclassification of assets of properties held for sale ( 55,089 ) ( 2,477 ) Balance at December 31, 2020 $ 3,522,143 $ 451,914 (1) Represents the reclassification between accumulated depreciation and building made to certain properties reclassified as assets of properties held for sale at fair value less costs to sell in accordance with GAAP. S-6 Table of Contents SIGNATURES Pursuant to the requirements of Section 13 and 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. OFFICE PROPERTIES INCOME TRUST By: /s/ Christopher J. Bilotto Christopher J. Bilotto President and Chief Operating Officer Dated: February 19, 2021 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. Signature Title Date /s/ Christopher J. Bilotto President and Chief Operating Officer February 19, 2021 Christopher J. Bilotto /s/ Matthew C. Brown Chief Financial Officer and Treasurer (principal financial officer and principal accounting officer) February 19, 2021 Matthew C. Brown /s/ David M. Blackman Managing Trustee February 19, 2021 David M. Blackman /s/ Adam D. Portnoy Managing Trustee February 19, 2021 Adam D. Portnoy /s/ Donna D. Fraiche Independent Trustee February 19, 2021 Donna D. Fraiche /s/ Barbara D. Gilmore Independent Trustee February 19, 2021 Barbara D. Gilmore /s/ John L. Harrington Independent Trustee February 19, 2021 John L. Harrington /s/ William A. Lamkin Independent Trustee February 19, 2021 William A. Lamkin /s/ Elena Poptodorova Independent Trustee February 19, 2021 Elena Poptodorova /s/ Jeffrey P. Somers Independent Trustee February 19, 2021 Jeffrey P. Somers