The following is a summary of the Office Properties Income Trust (OPI) Q3 2024 Earnings Call Transcript:

Financial Performance:

• OPI reported normalized FFO of $22.1 million or $0.43 per share for the third quarter of 2024, below the low end of the guidance range.

• Reported a decrease in normalized FFO compared to the second quarter of 2024 which was $33.2 million or $0.68 per share, primarily due to higher interest expense and lower NOI.

• Same property cash basis NOI declined 4% compared to the third quarter of 2023.

Business Progress:

• Executed 14 leases totaling 987,000 square feet with a weighted average lease term of 10.2 years, focusing on renewals and securing longer lease terms to stabilize occupancy.

• Engaged in property dispositions, under agreements to sell 17 properties totaling 1.6 million square feet for $119 million to enhance liquidity and reduce carrying costs of vacant properties.

• Increased efforts in tenant retention, especially within multi-tenant properties that have seen recent upgrades and are showing greater tenant demand.

Opportunities:

• The focus on multi-tenant properties experiencing greater demand could serve as a strategic pivot to stabilize revenue streams from these assets.

Risks:

• Ongoing challenges with debt maturity and potential inability to refinance or satisfy upcoming debt obligations create substantial doubt about the company's ability to continue as a going concern.

• Market conditions pose a risk as property sales remain challenging, affecting valuations and limiting the number of potential buyers, particularly for properties that are vacant or soon to be vacant.

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