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Item 1A. Risk Factors

2025-04-30 compared with 2024-10-30 · 86 added, 19 removed, 0 unchanged (100% of the section changed)

Our business is subject to risks and uncertainties, a number of which are described under the caption “Risk Factors” in our 2023 Annual Report.

The risks described in our 2023 Annual Report and below may not be the only risks we face but are risks we believe may be material at this time.

Other risks of which we are not yet aware, or that we currently believe are not material, may also materially and adversely impact our business operations or financial results.

If any of the events or circumstances described in the risk factors contained in our 2023 Annual Report or included below occurs, our business, financial condition, liquidity, results of operations or ability to pay distributions to our shareholders could be adversely impacted and the value of an investment in our securities could decline.

Investors and prospective investors should consider the risks described in our 2023 Annual Report and below and the information contained under the caption “Warning Concerning Forward-Looking Statements” and elsewhere in this Quarterly Report on Form 10-Q before deciding whether to invest in our securities.

Risk Relating to Going Concern

We have concluded that there is substantial doubt about our ability to continue as a going concern.

Our portfolio has been adversely affected by shifts in office space utilization, including increased remote work arrangements and tenants consolidating their real estate footprint.

Demand for office space continues to face headwinds and declining rents and increasing costs to relet space when tenants can be identified continue to impact the market.

In addition, there are limited debt or equity financing alternatives available to us to refinance our debt and financing sources we have utilized have increased our cost of capital.

The duration and ultimate impact of these factors on our properties and our business remains uncertain and subject to change;

however, these conditions continue to have a significant negative impact on our results of operations, financial position and cash flows.

As of October 30, 2024, our total available liquidity was comprised of $146,448 of cash and, in addition to long-term debt, the 2025 Notes are due within one year from the date of issuance of these financial statements.

As discussed in Note 1 to our condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q, based on these challenges and upcoming debt maturities, we have concluded that there is substantial doubt about our ability to continue as a going concern for at least one year after the date of issuance of such financial statements, or October 30, 2024.

Our continuation as a going concern is dependent upon many factors, including our ability to meet our debt covenants, repay our debts and other obligations when due and our ability to successfully negotiate a note exchange with certain holders of the 2025 Notes.

While we believe a note exchange with certain holders of the 2025 Notes would alleviate the substantial doubt about our ability to continue as going concern, any exchange is subject to the approval and participation of holders of the 2025 Notes and other closing conditions and we cannot provide assurance that the 2025 Notes exchange will be completed.

If we are unable to consummate a transaction that refinances the 2025 Notes on terms which, in our view, allow us to continue as a going concern, our Board of Trustees may consider a reorganization in a bankruptcy court.

We cannot be sure that we will be able to obtain any future financing, and any such financing we may obtain may not be sufficient to repay our existing debt.

If we are unable to obtain sufficient funds, we may be unable to continue as a going concern.

There have been no material changes to the risk factors from those previously disclosed in our 2024 Annual Report.

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 Registration Statement on Form S-3/A filed on April 1, 2025, File No.

3.2 Composite Copy of Amended and Restated Declaration of Trust, dated June 8, 2009, as amended to date (marked copy).

(Filed herewith.)

3.3 Third Amended and Restated Bylaws of the Company, adopted June 13, 2024.

(Incorporated by reference to the Company’s Current Report on Form 8-K filed on June 13, 2024.)

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 July 20, 2017, between the Company and U.S.