Form 10-Q - Quarterly report [Sections 13 or 15(d)]

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2023

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number 001-38342

INDUSTRIAL LOGISTICS PROPERTIES TRUST

(Exact Name of Registrant as Specified in Its Charter)


Maryland						82-2809631
(State or Other Jurisdiction of Incorporation or Organization)						(I.R.S. Employer Identification No.)

Two Newton Place, 255 Washington Street, Suite 300, Newton, Massachusetts 02458-1634

(Address of Principal Executive Offices)

(Zip Code)

617-219-1460

(Registrant’s Telephone Number, Including Area Code)

Securities Registered Pursuant to Section 12(b) of the Act:

Title of Each Class

Trading Symbol(s)

Name Of Each Exchange On Which Registered

Common Shares of Beneficial Interest

ILPT

The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Number of registrant’s common shares of beneficial interest, $.01 par value per share, outstanding as of October 23, 2023: 65,843,823.

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INDUSTRIAL LOGISTICS PROPERTIES TRUST

FORM 10-Q

September 30, 2023

INDEX


		Page
PART I	Financial Information	3

Item 1.	Financial Statements (unaudited)	3

	Condensed Consolidated Balance Sheets — September 30 , 2023 and December 31, 2022	3

	Condensed Consolidated Statements of Comprehensive Income (Loss) — Three and Nin e Months Ended September 30 , 2023 and 2022	4

	Condensed Consolidated Statements of Shareholders’ Equity — Three and Nine Months Ended September 30 , 2023 and 2022	5

	Condensed Consolidated Statements of Cash Flows — Nine Months Ended September 30 , 2023 and 2022	7

	Notes to Condensed Consolidated Financial Statements	9

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	19

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	31

Item 4.	Controls and Procedures	32

	Warning Concerning Forward-Looking Statements	33

	Statement Concerning Limited Liability	34

PART II	Other Information	35

Item 1A.	Risk Factors	35

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	35





Item 6.	Exhibits	36

	Signatures	37

References in this Quarterly Report on Form 10-Q to the Company, we, us or our include Industrial Logistics Properties Trust and its consolidated subsidiaries unless otherwise expressly stated or the context indicates otherwise.

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PART I. Financial Information

Item 1. Financial Statements

INDUSTRIAL LOGISTICS PROPERTIES TRUST

CONDENSED CONSOLIDATED BALANCE SHEETS

(dollars in thousands, except per share data)

(unaudited)


	September 30,		December 31,
	2023		2022
ASSETS
Real estate properties:
Land	$	1,110,279	$	1,117,779
Buildings and improvements	4,017,355		4,058,329
Total real estate properties, gross	5,127,634		5,176,108
Accumulated depreciation	(361,814)		(273,467)
Total real estate properties, net	4,765,820		4,902,641

Assets of properties held for sale	57,606		—
Investment in unconsolidated joint venture	124,411		124,358
Acquired real estate leases, net	254,968		297,445
Cash and cash equivalents	83,283		48,261
Restricted cash	139,220		92,519
Rents receivable, including straight line rents of $91,218 and $80,710, respectively	113,665		107,011



Other assets, net	95,342		103,931
Total assets	$	5,634,315	$	5,676,166

LIABILITIES AND EQUITY



Mortgages and notes payable, net	$	4,303,631	$	4,244,501
Liabilities of properties held for sale	1,156		—
Accounts payable and other liabilities	86,028		73,547
Assumed real estate lease obligations, net	19,466		22,523


Due to related persons	5,896		4,824
Total liabilities	4,416,177		4,345,395

Commitments and contingencies

Equity:
Equity attributable to common shareholders:
Common shares of beneficial interest, $.01 par value: 100,000,000 shares authorized; 65,845,073 and 65,568,145 shares issued and outstanding, respectively	658		656
Additional paid in capital	1,015,468		1,014,201
Cumulative net income	40,436		117,185
Cumulative other comprehensive income	22,142		21,903
Cumulative common distributions	(365,189)		(363,221)
Total equity attributable to common shareholders	713,515		790,724
Noncontrolling interest	504,623		540,047
Total equity	1,218,138		1,330,771
Total liabilities and equity	$	5,634,315	$	5,676,166

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

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INDUSTRIAL LOGISTICS PROPERTIES TRUST

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(amounts in thousands, except per share data)

(unaudited)



	Three Months Ended September 30,					Nine Months Ended September 30,
		2023		2022			2023		2022




Rental income		$	110,142	$	103,215		$	328,443	$	281,812

Expenses:
Real estate taxes		14,926		13,749			46,493		36,460
Other operating expenses		9,907		8,453			27,744		22,278
Depreciation and amortization		43,912		48,519			134,278		114,096
General and administrative		7,712		9,110			23,750		24,896
Acquisition and other transaction related costs		—		586			—		586
Loss on impairment of real estate		—		—			254		100,747


Total expenses		76,457		80,417			232,519		299,063

Interest and other income		2,397		1,068			5,340		1,900
Interest expense (including net amortization of debt issuance costs, premiums and discounts of $6,743, $35,496, $20,177, and $90,265, respectively)		(72,941)		(89,739)			(215,558)		(208,286)
Loss on sale of real estate		—		—			(974)		(10)
Loss on equity securities		—		—			—		(5,758)
Loss on early extinguishment of debt		—		(21,370)			(359)		(22,198)
Loss before income tax expense and equity in earnings of unconsolidated joint venture		(36,859)		(87,243)			(115,627)		(251,603)
Income tax expense		(51)		(28)			(113)		(113)
Equity in earnings of unconsolidated joint venture		719		3,297			7,423		6,634
Net loss		(36,191)		(83,974)			(108,317)		(245,082)
Net loss attributable to noncontrolling interest		10,079		38,347			31,568		49,402
Net loss attributable to common shareholders		(26,112)		(45,627)			(76,749)		(195,680)


Other comprehensive income:
Unrealized (loss) gain on derivatives		(6,635)		8,847			(3,392)		18,917
Less: unrealized loss (gain) on derivatives attributable to noncontrolling interest		2,290		(4,119)			3,631		(6,617)
Other comprehensive (loss) income attributable to common shareholders		(4,345)		4,728			239		12,300
Comprehensive loss attributable to common shareholders		$	(30,457)	$	(40,899)		$	(76,510)	$	(183,380)

Weighted average common shares outstanding (basic and diluted)		65,488		65,250			65,389		65,228


Per common share data (basic and diluted):
Net loss attributable to common shareholders		$	(0.40)	$	(0.70)		$	(1.17)	$	(3.00)

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

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INDUSTRIAL LOGISTICS PROPERTIES TRUST

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(dollars in thousands)

(unaudited)


								Cumulative				Total Equity
	Number of			Additional				Other		Cumulative		Attributable to
	Common	Common		Paid In		Cumulative		Comprehensive		Common		Common		Noncontrolling		Total
	Shares	Shares		Capital		Net Income		Income		Distributions		Shareholders		Interest		Equity
Balance at December 31, 2022	65,568,145	$	656	$	1,014,201	$	117,185	$	21,903	$	(363,221)	$	790,724	$	540,047	$	1,330,771
Net loss	—	—		—		(24,809)		—		—		(24,809)		(10,737)		(35,546)
Share grants, repurchases and forfeitures	(2,176)	—		384		—		—		—		384		—		384
Distributions to common shareholders	—	—		—		—		—		(656)		(656)		—		(656)
Other comprehensive loss	—	—		—		—		(7,018)		—		(7,018)		(1,760)		(8,778)


Balance at March 31, 2023	65,565,969	656		1,014,585		92,376		14,885		(363,877)		758,625		527,550		1,286,175
Net loss	—	—		—		(25,828)		—		—		(25,828)		(10,752)		(36,580)
Share grants, repurchases and forfeitures	131,990	1		553		—		—		—		554		—		554
Distributions to common shareholders	—	—		—		—		—		(656)		(656)		—		(656)
Other comprehensive income	—	—		—		—		11,602		—		11,602		419		12,021

Distributions to noncontrolling interest	—	—		—		—		—		—		—		(225)		(225)
Balance at June 30, 2023	65,697,959	657		1,015,138		66,548		26,487		(364,533)		744,297		516,992		1,261,289
Net loss	—	—		—		(26,112)		—		—		(26,112)		(10,079)		(36,191)
Share grants, repurchases and forfeitures	147,114	1		330		—		—		—		331		—		331
Distributions to common shareholders	—	—		—		—		—		(656)		(656)		—		(656)
Other comprehensive loss	—	—		—		—		(4,345)		—		(4,345)		(2,290)		(6,635)


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

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								Cumulative				Total Equity
	Number of			Additional				Other		Cumulative		Attributable to
	Common	Common		Paid In		Cumulative		Comprehensive		Common		Common		Noncontrolling		Total
	Shares	Shares		Capital		Net Income		Income		Distributions		Shareholders		Interest		Equity
Balance at December 31, 2021	65,404,592	$	654	$	1,012,224	$	343,908	$	—	$	(318,744)	$	1,038,042	$	—	$	1,038,042
Net loss	—	—		—		(6,514)		—		—		(6,514)		(3,273)		(9,787)
Share grants, repurchases and forfeitures	(733)	—		398		—		—		—		398		—		398
Other comprehensive income	—	—		—		—		3,908		—		3,908		1,724		5,632
Contributions from noncontrolling interest	—	—		—		—		—		—		—		591,268		591,268
Distributions to common shareholders	—	—		—		—		—		(21,584)		(21,584)		—		(21,584)
Balance at March 31, 2022	65,403,859	654		1,012,622		337,394		3,908		(340,328)		1,014,250		589,719		1,603,969
Net loss	—	—		—		(143,539)		—		—		(143,539)		(7,782)		(151,321)
Share grants, repurchases and forfeitures	23,600	—		796		—		—		—		796		—		796
Other comprehensive income	—	—		—		—		3,664		—		3,664		774		4,438
Distributions to noncontrolling interest	—	—		—		—		—		—		—		(1,365)		(1,365)
Distributions to common shareholders	—	—		—		—		—		(21,583)		(21,583)		—		(21,583)
Balance at June 30, 2022	65,427,459	654		1,013,418		193,855		7,572		(361,911)		853,588		581,346		1,434,934
Net loss	—	—		—		(45,627)		—		—		(45,627)		(38,347)		(83,974)
Share grants, repurchases and forfeitures	141,245	2		384		—		—		—		386		—		386
Other comprehensive income	—	—		—		—		4,728		—		4,728		4,119		8,847

Contributions from noncontrolling interest	—	—		—		—		—		—		—		1,971		1,971
Distributions to common shareholders	—	—		—		—		—		(654)		(654)		—		(654)
Balance at September 30, 2022	65,568,704	$	656	$	1,013,802	$	148,228	$	12,300	$	(362,565)	$	812,421	$	549,089	$	1,361,510

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

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INDUSTRIAL LOGISTICS PROPERTIES TRUST

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(dollars in thousands)

(unaudited)


	Nine Months Ended September 30,
	2023		2022
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(108,317)	$	(245,082)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation	93,545		75,014
Loss on impairment of real estate	254		100,747
Net amortization of debt issuance costs, premiums and discounts	20,177		90,265
Amortization of acquired real estate leases and assumed real estate lease obligations	38,275		33,680
Amortization of deferred leasing costs	1,723		1,170


Loss on equity securities	—		5,758
Straight line rental income	(10,531)		(8,170)
Loss on early extinguishment of debt	359		22,198
Loss on sale of real estate	974		10
Proceeds from settlement of derivatives	(40,426)		—
Other non-cash expenses	19,865		4,443
Distributions of earnings from unconsolidated joint venture	2,970		3,962
Equity in earnings of unconsolidated joint venture	(7,423)		(6,634)

Change in assets and liabilities:
Rents receivable	3,260		(16,299)


Other assets	(11,459)		3,615
Accounts payable and other liabilities	9,745		14,921


Due to related persons	1,072		2,309
Net cash provided by operating activities	14,063		81,907

CASH FLOWS FROM INVESTING ACTIVITIES:
Real estate acquisitions	—		(3,589,085)
Real estate improvements	(13,649)		(8,741)



Proceeds from sale of marketable securities	—		140,792

Proceeds from sale of real estate	243		—
Proceeds from settlement of derivatives	40,426		—



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

Net cash provided by (used in) investing activities	31,420		(3,457,034)




CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of mortgage notes payable	91,000		3,335,000
Repayment of mortgage notes payable	(50,993)		(12,591)
Proceeds from secured bridge loan facility	—		1,385,158
Repayment of secured bridge loan facility	—		(1,385,158)
Borrowings under revolving credit facility	—		3,000
Repayments of revolving credit facility	—		(185,000)
Payment of debt issuance costs	(1,414)		(211,996)

Distributions to common shareholders	(1,968)		(43,821)
Proceeds from sale of noncontrolling interest, net	—		589,411
Repurchase of common shares	(160)		(239)
Distributions to noncontrolling interest	(225)		(1,365)
Net cash provided by financing activities	36,240		3,472,399

Increase in cash, cash equivalents and restricted cash	81,723		97,272
Cash, cash equivalents and restricted cash at beginning of period	140,780		29,397
Cash, cash equivalents and restricted cash at end of period	$	222,503	$	126,669

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SUPPLEMENTAL DISCLOSURES:
Interest paid	$	218,369	$	113,748
Income taxes paid	$	85	$	223
Interest capitalized	$	545	$	68

NON-CASH INVESTING ACTIVITIES:



Real estate acquired by assumption of mortgage notes payable	$	—	$	323,432
Real estate improvements accrued not paid	$	2,810	$	7,165

NON-CASH FINANCING ACTIVITIES:
Assumption of mortgage notes payable	$	—	$	(323,432)


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 condensed consolidated balance sheets to the amounts shown in the condensed consolidated statements of cash flows:
	As of September 30,
	2023		2022
Cash and cash equivalents	$	83,283	$	26,381
Restricted cash (1)	139,220		100,288
Total cash, cash equivalents and restricted cash shown in the statements of cash flows	$	222,503	$	126,669

(1)Restricted cash consists of amounts escrowed for capital expenditures at certain of our mortgaged properties and cash held for the operations of our consolidated joint venture.

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

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INDUSTRIAL LOGISTICS PROPERTIES TRUST

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

Note 1. Basis of Presentation

The accompanying condensed consolidated financial statements of Industrial Logistics Properties Trust and its consolidated subsidiaries, or the Company, ILPT, we, us or our, are unaudited. Certain information and disclosures required by U.S. generally accepted accounting principles, or GAAP, for complete financial statements have been condensed or omitted. We believe the disclosures made are adequate to make the information presented not misleading. However, the accompanying condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes contained in our Annual Report on Form 10-K for the year ended December 31, 2022, or our 2022 Annual Report. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair statement of results for the interim period have been included. All intercompany transactions and balances with or among our consolidated subsidiaries have been eliminated. Our operating results for interim periods are not necessarily indicative of the results that may be expected for the full year.

The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect reported amounts. Actual results could differ from those estimates. Significant estimates in the condensed consolidated financial statements include purchase price allocations, useful lives of fixed assets, and assessment of impairment of real estate and related intangibles.

Note 2. Real Estate Investments

As of September 30, 2023, our portfolio was comprised of 413 consolidated properties containing approximately 59,983,000 rentable square feet, including 226 buildings, leasable land parcels and easements containing approximately 16,729,000 rentable square feet of primarily industrial lands located on the island of Oahu, Hawaii, or our Hawaii Properties, and 187 industrial properties containing approximately 43,254,000 rentable square feet located in 38 other states, or our Mainland Properties, which included 94 properties in 27 states totaling approximately 20,981,000 rentable square feet, owned by a consolidated joint venture in which we own a 61% equity interest. As of September 30, 2023, we also owned a 22% equity interest in an unconsolidated joint venture which owns 18 industrial properties located in 12 states totaling approximately 11,726,000 rentable square feet.

We operate in one business segment: ownership and leasing of properties that include industrial and logistics buildings and leased industrial lands.

We incurred capital expenditures and leasing costs at certain of our properties of $5,275 and $8,574 during the three months ended September 30, 2023 and 2022, respectively, and $17,857 and $22,419 for the nine months ended September 30, 2023 and 2022, respectively. During the nine months ended September 30, 2023, we committed $7,273 for expenditures related to tenant improvements and leasing costs for leases executed during the period for approximately 3,868,000 rentable square feet. Committed, but unspent, tenant related obligations based on existing leases as of September 30, 2023 were $5,923, of which $3,529 is expected to be spent during the next 12 months.

Impairment

We regularly evaluate whether events or changes in circumstances have occurred that could indicate an impairment in the value of long lived assets. Impairment indicators may include declining tenant occupancy, lack of progress leasing vacant space, tenant bankruptcies, low long term prospects for improvement in property performance, weak or declining tenant profitability, cash flow or liquidity, our decision to dispose of an asset before the end of its estimated useful life and legislative, market or industry changes that could permanently reduce the value of a property. 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. If the carrying value exceeds the projected undiscounted cash flows, 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 useful lives of our long lived assets. If we change our estimate of the remaining useful lives, we allocate the carrying value of the affected assets over their revised remaining useful lives.

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INDUSTRIAL LOGISTICS PROPERTIES TRUST

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

During the nine months ended September 30, 2023, we recognized a loss on impairment of real estate of $254 to reduce the carrying value of a property that was classified as held for sale at September 30, 2023 to its estimated sales price less costs to sell.

During the nine months ended September 30, 2022, we recognized a $100,747 loss on impairment for 25 properties we acquired as part of our acquisition of Monmouth Real Estate Investment Corporation, or MNR, on February 25, 2022, to adjust the carrying value of these properties to their estimated fair value.

Disposition Activities

In March 2023, we received gross proceeds of $270 and recognized a $974 net loss on sale of real estate as a result of a property in Everett, Washington partially taken by eminent domain.

As of September 30, 2023, we had three Mainland Properties with an aggregate carrying value of $56,944, classified as held for sale in our condensed consolidated balance sheet. As of October 25, 2023, one of these properties is under agreement to sell for a sales price of $21,500, excluding closing costs. This pending sale is subject to conditions; accordingly, we cannot be sure that we will complete this sale, that this sale will not be delayed or that the terms will not change. We terminated agreements to sell two of these properties for an aggregate sales price of $43,765 and we continue to market one of these two properties for sale.

Consolidated Joint Venture

We own a 61% equity interest in Mountain Industrial REIT LLC, or Mountain JV, or our consolidated joint venture, which owns 94 properties in 27 states totaling approximately 20,981,000 rentable square feet. We control our consolidated joint venture and therefore account for the properties owned by this joint venture on a consolidated basis in our condensed consolidated financial statements. We recognized a 39% noncontrolling interest in our condensed consolidated financial statements for the three months ended September 30, 2023 and 2022, for the nine months ended September 30, 2023 and the period from this joint venture’s formation date, February 25, 2022 to September 30, 2022. The portion of this joint venture's net loss not attributable to us, or $10,238 and $38,318, for the three months ended September 30, 2023 and 2022, respectively, and $31,642 and $49,360 for the nine months ended September 30, 2023 and for the period from February 25, 2022 to September 30, 2022, respectively, is reported as net loss attributable to noncontrolling interest in our condensed consolidated statements of comprehensive income (loss). As of September 30, 2023, our consolidated joint venture had total assets of $3,065,834 and total liabilities of $1,781,222.

Consolidated Tenancy in Common

An unrelated third party owns an approximate 33% tenancy in common interest in one property located in Somerset, New Jersey with approximately 64,000 rentable square feet, and we own the remaining 67% tenancy in common interest in this property. The portion of this property’s net income (loss) not attributable to us, or $159 and ($29), for the three months ended September 30, 2023 and 2022, respectively, and $74 and ($42) for the nine months ended September 30, 2023 and the period from the date we acquired our interest in this property, February 25, 2022 to September 30, 2022, respectively, is reported as net loss attributable to noncontrolling interest in our condensed consolidated statements of comprehensive income (loss). During the nine months ended September 30, 2023, this tenancy in common made cash distributions of $225 to the unrelated third party investor, which is reflected as a decrease in noncontrolling interest in our condensed consolidated balance sheet.

Unconsolidated Joint Venture

We own a 22% equity interest in The Industrial Fund REIT LLC, or the unconsolidated joint venture, which owns 18 industrial properties located in 12 states totaling approximately 11,726,000 rentable square feet. We account for the unconsolidated joint venture under the equity method of accounting under the fair value option. We recognize changes in the fair value of our investment in the unconsolidated joint venture as equity in earnings of the unconsolidated joint venture in our condensed consolidated statements of comprehensive income (loss).

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INDUSTRIAL LOGISTICS PROPERTIES TRUST

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

Note 3. Leases

We are a lessor of industrial and logistics properties. Our leases provide our tenants with the contractual right to use and economically benefit from all the physical space specified in their respective leases; therefore, we have determined to evaluate our leases as lease arrangements.

We recognize rental income from operating leases 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 $3,414 and $3,794 to record revenue on a straight line basis during the three months ended September 30, 2023 and 2022, respectively, and $10,531 and $8,170 for the nine months ended September 30, 2023 and 2022, 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 $19,310 and $16,664 for the three months ended September 30, 2023 and 2022, respectively, and $58,700 and $46,071 for the nine months ended September 30, 2023 and 2022, respectively.

Generally, payments of ground lease obligations are made by our tenants. However, if a tenant does not perform obligations under a ground lease or does not renew any ground lease, we may have to perform obligations under, or renew, the ground lease in order to protect our investment in the affected property.

We define annualized rental revenues as the annualized contractual base rents from our tenants pursuant to our lease agreements as of the measurement date, including straight line rent adjustments and estimated recurring expense reimbursements to be paid to us, and excluding lease value amortization.

Right of Use Assets and Lease Liabilities

We are the lessee for three of our properties subject to ground leases and one office property that we assumed as part of our acquisition of MNR. For leases with a term greater than 12 months under which we are the lessee, we are required to record a right of use asset and lease liability. The values of our right of use assets and related lease liabilities were $4,757 and $4,837, respectively, as of September 30, 2023, and $5,084 and $5,149, respectively, as of December 31, 2022. Our right of use assets and related lease liabilities are included in other assets, net and accounts payable and other liabilities, respectively, in our condensed consolidated balance sheets.

We sublease a portion of our office property assumed in the acquisition of MNR. Rent expense incurred under this lease, net of sublease revenue, was $12 and $176 for three months ended September 30, 2023 and 2022, respectively, and $141 and $355 for the nine months ended September 30, 2023 and the period from February 25, 2022 to September 30, 2022, respectively. Rent expense is included in general and administrative expense in our condensed consolidated statements of comprehensive income (loss).

Tenant Concentration

Subsidiaries of FedEx Corporation and Amazon.com Services, Inc. were responsible for approximately 29.8% and 6.7% of our annualized rental revenues as of September 30, 2023, respectively, and 29.6% and 6.8% as of September 30, 2022, respectively.

Geographic Concentration

For the three months ended September 30, 2023 and 2022, approximately 28.1% and 26.8%, respectively, of our rental income was from our Hawaii Properties. For the nine months ended September 30, 2023 and 2022, approximately 27.9% and 30.6%, respectively, of our rental income was from our Hawaii Properties.

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INDUSTRIAL LOGISTICS PROPERTIES TRUST

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

Note 4. Indebtedness

As of September 30, 2023 and December 31, 2022, our outstanding indebtedness consisted of the following:





	Number of		Principal Balance at								Carrying Value of Collateral at
	Properties		September 30,		December 31,		Interest				September 30,		December 31,
Entity	Secured By		2023		2022		Rate (1)	Type	Maturity		2023		2022

ILPT	104		$	1,235,000	$	1,235,000	6.18%	Floating	10/9/2024		$	1,049,983	$	1,071,815
ILPT	186		650,000		650,000		4.31%	Fixed	2/7/2029		489,901		490,416
ILPT	17		700,000		700,000		4.42%	Fixed	3/9/2032		508,383		518,806
Mountain JV	82		1,400,000		1,400,000		6.17%	Floating	3/9/2024		1,870,541		1,909,185
Mountain JV	4		91,000		—		6.25%	Fixed	6/10/2030		184,375		—
Mountain JV	1		11,712		12,691		3.67%	Fixed	5/1/2031		29,094		30,800
Mountain JV	1		13,228		14,144		4.14%	Fixed	7/1/2032		43,826		44,777
Mountain JV	1		29,213		30,949		4.02%	Fixed	10/1/2033		85,380		87,143
Mountain JV	1		40,832		43,219		4.13%	Fixed	11/1/2033		130,197		131,539
Mountain JV	1		24,873		26,175		3.10%	Fixed	6/1/2035		46,725		47,718
Mountain JV	1		40,087		42,087		2.95%	Fixed	1/1/2036		99,805		101,896
Mountain JV	1		44,423		46,109		4.27%	Fixed	11/1/2037		110,881		113,063
Mountain JV	1		50,002		52,031		3.25%	Fixed	1/1/2038		114,259		116,607
Mountain JV	1		—		13,556		N/A	Fixed	10/1/2028		—		63,314
Mountain JV	1		—		4,865		N/A	Fixed	4/1/2030		—		39,724
Mountain JV	1		—		5,145		N/A	Fixed	4/1/2030		—		39,724
Mountain JV	1		—		14,392		N/A	Fixed	9/1/2030		—		50,825
Total / weighted average	4,330,370		4,290,363		5.47%				$	4,763,350	$	4,857,352
Unamortized debt issuance costs	(26,739)		(45,862)
Total indebtedness, net	$	4,303,631	$	4,244,501

(1)Interest rates are as of September 30, 2023 and reflect the impact of interest rate caps, if any, and exclude the impact of the amortization of debt issuance costs, premiums and discounts.

Our $1,235,000 loan, or the ILPT Floating Rate Loan, matures in October 2024, subject to three, one year extension options, and requires that interest be paid at an annual rate of secured overnight financing rate, or SOFR, plus a weighted average premium of 3.93%. The weighted average interest rate payable under the ILPT Floating Rate Loan was 6.18%, including the impact of our interest rate cap on SOFR of 2.25%, for both the three and nine months ended September 30, 2023. Beginning in October 2023, subject to the satisfaction of certain conditions, we have the option to prepay the ILPT Floating Rate Loan in full or in part at any time at par with no premium.

Our $1,400,000 loan, or the Floating Rate Loan, matures in March 2024, subject to three, one year extension options, and requires that interest be paid at an annual rate of SOFR plus a premium of 2.77%. The weighted average annual interest rate payable under the Floating Rate Loan was 6.17%, including the impact of our interest rate cap on SOFR of 3.40%, for both the three and nine months ended September 30, 2023. The weighted average annual interest rate payable under the Floating Rate Loan was 4.94% and 4.23% for the three months ended September 30, 2022 and the period from February 25, 2022 to September 30, 2022, respectively. Subject to the satisfaction of certain conditions, we have the option to prepay up to $280,000 of the Floating Rate Loan at par with no premium, and to prepay the balance of the Floating Rate Loan at any time, subject to a premium.

See Note 9 for more information regarding our interest rate caps.

In May 2023, our consolidated joint venture obtained a $91,000 fixed rate, interest only mortgage loan secured by four properties owned by our consolidated joint venture. This mortgage loan matures in June 2030 and requires that interest be paid at an annual rate of 6.25%. A portion of the net proceeds from this mortgage loan was used to repay four outstanding mortgage loans of our consolidated joint venture with an aggregate outstanding principal balance of $35,910 and a weighted average interest rate of 3.70%. We recognized a loss on early extinguishment of debt of $359 for the nine months ended September 30, 2023 in conjunction with the repayment of these mortgage loans.

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INDUSTRIAL LOGISTICS PROPERTIES TRUST

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

The agreements governing certain of our indebtedness contain customary covenants and provide for acceleration of payment of all amounts due thereunder upon the occurrence and continuation of certain events of default.

Note 5. Fair Value of Assets and Liabilities

Our financial instruments include cash and cash equivalents, restricted cash, mortgages and notes payables, accounts payable and interest rate caps. At September 30, 2023 and December 31, 2022, the fair value of our financial instruments approximated their carrying values in our condensed consolidated financial statements, due to their short term nature or floating interest rates, except as follows:


	At September 30, 2023				At December 31, 2022
	Carrying				Carrying
	Value (1)		Fair Value		Value (1)		Fair Value
Fixed rate loan, 4.31% interest rate, due in 2029	$	647,077	$	613,520	$	646,669	$	592,295
Fixed rate loan, 6.25% interest rate, due in 2030	90,038		94,438		—		—
Fixed rate loan, 3.67% interest rate, due in 2031	11,712		11,009		12,691		11,713
Fixed rate loan, 4.42% interest rate, due in 2032	695,134		609,714		694,704		623,133
Fixed rate loan, 4.14% interest rate, due in 2032	13,228		12,611		14,144		13,182
Fixed rate loan, 4.02% interest rate, due in 2033	29,213		27,185		30,949		28,195
Fixed rate loan, 4.13% interest rate, due in 2033	40,832		38,181		43,219		39,573
Fixed rate loan, 3.10% interest rate, due in 2035	24,873		21,837		26,175		22,373
Fixed rate loan, 2.95% interest rate, due in 2036	40,087		34,723		42,087		35,444
Fixed rate loan, 4.27% interest rate, due in 2037	44,423		41,466		46,109		41,880
Fixed rate loan, 3.25% interest rate, due in 2038	50,001		43,463		52,031		43,878
Fixed rate loan, 3.76% interest rate, due in 2028 (2)	—		—		13,556		12,784
Fixed rate loan, 3.77% interest rate, due in 2030 (2)	—		—		4,865		4,553
Fixed rate loan, 3.85% interest rate, due in 2030 (2)	—		—		5,145		4,829
Fixed rate loan, 3.56% interest rate, due in 2030 (2)	—		—		14,392		13,315
	$	1,686,618	$	1,548,147	$	1,646,736	$	1,487,147

(1)Includes unamortized debt issuance costs, premiums and discounts of $8,751 and $8,628 at September 30, 2023 and December 31, 2022, respectively.

(2)This loan was repaid in May 2023.

We estimate the fair value of our mortgage notes payable using significant unobservable inputs (Level 3), such as discounted cash flow analyses and prevailing market rates as of the measurement date.

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INDUSTRIAL LOGISTICS PROPERTIES TRUST

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

The table below presents certain of our assets measured on a recurring and non-recurring basis at fair value at September 30, 2023 and December 31, 2022, categorized by the level of inputs as defined in the fair value hierarchy under GAAP, used in the valuation of each asset:


			Quoted Prices in		Significant Other		Significant
			Active Markets for		Observable		Unobservable
			Identical Assets		Inputs		Inputs
	Total		(Level 1)		(Level 2)		(Level 3)
At September 30, 2023
Recurring fair value measurements
Investment in unconsolidated joint venture	$	124,411	$	—	$	—	$	124,411
Interest rate cap derivatives (1)	$	51,322	$	—	$	51,322	$	—
Non-recurring fair value measurements
Real estate properties (2)	$	1,414	$	—	$	—	$	1,414

At December 31, 2022
Recurring fair value measurements
Investment in unconsolidated joint venture	$	124,358	$	—	$	—	$	124,358
Interest rate cap derivatives (1)	$	73,133	$	—	$	73,133	$	—
Non-recurring fair value measurements
Real estate properties (2)	$	555,123	$	—	$	—	$	555,123

(1)The estimated fair values of our interest rate cap derivatives are based on then current market prices in secondary markets for similar derivative contracts.

(2)At September 30, 2023 and December 31, 2022, we reduced the carrying value of one property and 25 properties, respectively, to their estimated fair value based on third party offers. See Note 2 for more information.

At September 30, 2023 and December 31, 2022, the fair value of our investment in the unconsolidated joint venture was determined by discounting expected future cash flows based on prevailing market rents over a holding period and including an exit capitalization rate to determine the final year of cash flows. The discount rates, exit capitalization rates and holding periods used are Level 3 significant unobservable inputs and are shown in the table below:

Exit

Capitalization

Valuation Technique

Discount Rates

Rates

Holding Periods

At September 30, 2023

Investment in unconsolidated joint venture

Discounted cash flow

5.25% - 7.00%

4.95% - 6.00%

10 - 12 years

At December 31, 2022

Investment in unconsolidated joint venture

Discounted cash flow

5.25% - 7.00%

4.75% - 6.00%

10 years

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


	Three Months				Nine Months
	Ended September 30,				Ended September 30,
	2023		2022		2023		2022
Beginning balance	$	129,082	$	143,716	$	124,358	$	143,021
Equity in earnings of unconsolidated joint venture	719		3,297		7,423		6,634
Distributions from unconsolidated joint venture	(5,390)		(1,320)		(7,370)		(3,962)
Ending balance	$	124,411	$	145,693	$	124,411	$	145,693

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INDUSTRIAL LOGISTICS PROPERTIES TRUST

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

Note 6. Shareholders’ Equity

Common Share Awards

On June 1, 2023, in accordance with our Trustee compensation arrangements, we awarded to each of our seven Trustees 20,000 of our common shares, valued at $1.78 per share, the closing price of our common shares on The Nasdaq Stock Market LLC, or Nasdaq, on that day.

On September 13, 2023, we awarded under our equity compensation plan an aggregate of 188,350 of our common shares, valued at $3.63 per share, the closing price of our common shares on Nasdaq on that day, to our officers and certain other employees of The RMR Group LLC, or RMR.

Common Share Purchases

During the three and nine months ended September 30, 2023, we purchased an aggregate of 40,636 and 48,722 of our common shares, respectively, valued at a weighted average price of $3.54 and $3.29 per common share, respectively, from our officers and certain other current and former employees of RMR in satisfaction of tax withholding and payment obligations in connection with the vesting of awards of our common shares.

Distributions

During the nine months ended September 30, 2023, we declared and paid regular quarterly distributions to common shareholders as follows:


Declaration Date	Record Date	Payment Date	Distribution Per Share		Total Distribution
January 12, 2023	January 23, 2023	February 16, 2023	$	0.01	$	656
April 13, 2023	April 24, 2023	May 18, 2023	0.01		656
July 13, 2023	July 24, 2023	August 17, 2023	0.01		656
			$	0.03	$	1,968

Note 7. Business and Property Management Agreements with RMR

We have no employees. The personnel and various services we require to operate our business are provided to us by RMR. We have two agreements with RMR 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.

Pursuant to our business management agreement with RMR, we recognized net business management fees of $5,919 and $17,301 for the three and nine months ended September 30, 2023, respectively, and $6,465 and $17,821 for the three and nine months ended September 30, 2022, respectively. Based on our common share total return, as defined in our business management agreement, as of September 30, 2023 and 2022, no incentive fees are included in the net business management fees we recognized for the three and nine months ended September 30, 2023 or 2022. The actual amount of annual incentive fees for 2023, if any, will be based on our common share total return, as defined in our business management agreement, for the three-year period ending December 31, 2023, and will be payable in January 2024. We did not incur any incentive fee payable to RMR for the year ended December 31, 2022. We include business management fees in general and administrative expenses in our condensed consolidated statements of comprehensive income (loss).

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INDUSTRIAL LOGISTICS PROPERTIES TRUST

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

Pursuant to our property management agreement with RMR, we recognized aggregate property management and construction supervision fees of $3,464 and $10,286 for the three and nine months ended September 30, 2023, respectively, and $3,270 and $8,797 for the three and nine months ended September 30, 2022, respectively. Of these amounts, for the three and nine months ended September 30, 2023, $3,293 and $9,745, respectively, were included in other operating expenses in our condensed consolidated statements of comprehensive income (loss) and $171 and $541, respectively, were capitalized as building improvements in our condensed consolidated balance sheets. For the three and nine months ended September 30, 2022, $2,976 and $8,104, respectively, were included in other operating expenses in our condensed consolidated statements of comprehensive income (loss) and $294 and $693, respectively, were capitalized as buildings and improvements in our condensed consolidated balance sheets. The amounts capitalized are being depreciated over the estimated useful lives of the related capital assets.

We are generally responsible for all our operating expenses, including certain expenses incurred or arranged by RMR on our behalf. We are generally not responsible for payment of RMR’s employment, office or administrative expenses incurred to provide management services to us, except for the employment and related expenses of RMR’s employees assigned to work exclusively or partly at our properties, our share of the wages, benefits and other related costs of RMR’s centralized accounting personnel, our share of RMR’s costs for providing our internal audit function, or as otherwise agreed. Our property level operating expenses are generally incorporated into the rents charged to our tenants, including certain payroll and related costs incurred by RMR. We reimbursed RMR $2,375 and $6,216 for these expenses and costs for the three and nine months ended September 30, 2023, respectively, and $1,847 and $5,155 for the three and nine months ended September 30, 2022, respectively. These amounts are included in other operating expenses and general and administrative expenses, as applicable, in our condensed consolidated statements of comprehensive income (loss).

Management Agreements Between Our Joint Ventures and RMR. We have two separate joint venture arrangements, our consolidated joint venture and the unconsolidated joint venture. RMR provides management services to both of these joint ventures. We are not obligated to pay management fees to RMR under our management agreements with RMR for the services it provides to the unconsolidated joint venture. We are obligated to pay management fees to RMR under our management agreements with RMR for the services it provides to our consolidated joint venture; however, that joint venture pays management fees directly to RMR, and any such fees paid by our consolidated joint venture are credited against the fees payable by us to RMR. See Note 2 for further information about our joint ventures.

See Note 8 for further information regarding our relationships, agreements and transactions with RMR.

Note 8. Related Person Transactions

We have relationships and historical and continuing transactions with RMR, The RMR Group Inc., or RMR Inc., and others related to them, including other companies to which RMR or its subsidiaries provide management services and some of which have trustees, directors or officers who are also our Trustees or officers. RMR is a majority owned subsidiary of RMR Inc. The Chair of our Board of Trustees and one of our Managing Trustees, Adam D. Portnoy, is the sole trustee, an officer and the controlling shareholder of ABP Trust, which is the controlling shareholder of RMR Inc., the chair of the board of directors, a managing director and the president and chief executive officer of RMR Inc. and an officer and employee of RMR. Matthew P. Jordan, our other Managing Trustee, is an executive vice president and the chief financial officer and treasurer of RMR Inc., an officer and employee of RMR and an officer of ABP Trust. John G. Murray, one of our Managing Trustees until June 1, 2022 and our President and Chief Executive Officer until March 31, 2022, also serves as an officer and employee of RMR, and each of our current officers is also an officer and employee of RMR. Some of our Independent Trustees also serve as independent trustees of other public companies to which RMR or its subsidiaries provide management services. Adam D. Portnoy serves as chair of the boards and as a managing trustee of those companies. Other officers of RMR, including Messrs. Jordan and Murray and certain of our officers, serve as managing trustees or officers of certain of these companies.

See Note 6 for information relating to the awards of our common shares we made in September 2023 to our officers and certain other employees of RMR and common shares we purchased from our officers and certain other current and former officers and employees of RMR in satisfaction of tax withholding and payment obligations in connection with the vesting of awards of our common shares. We include amounts recognized as expense for awards of our common shares to our officers and RMR employees in general and administrative expenses in our condensed consolidated statements of comprehensive income (loss).

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INDUSTRIAL LOGISTICS PROPERTIES TRUST

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

Our Manager, RMR. We have two agreements with RMR to provide management services to us. See Note 7 for further information regarding our management agreements with RMR.

Joint Ventures. We have two separate joint venture arrangements. RMR provides management services to each of these joint ventures. As of September 30, 2023 and December 31, 2022, we owed $613 and $616, respectively, to the unconsolidated joint venture for rents that we collected on behalf of that joint venture. These amounts are presented as due to related persons in our condensed consolidated balance sheets. We paid these amounts in October 2023 and January 2023, respectively. See Notes 2 and 7 for further information regarding our joint ventures and RMR’s management agreements with our joint ventures.

For further information about these and other such relationships and certain other related person transactions, see our 2022 Annual Report.

Note 9. Derivatives and Hedging Activities

Risk Management Objective of Using Derivatives

We are exposed to certain risks relating to our ongoing business operations, including the impact of changes in interest rates. The only risk currently managed by us using derivative instruments is our interest rate risk. We have an interest rate cap agreement to manage our interest rate risk exposure on each of the ILPT Floating Rate Loan and the Floating Rate Loan, both with interest payable at a rate equal to SOFR plus a premium. The use of derivative financial instruments carries certain risks, including the risk that the counterparties to these contractual arrangements are not able to perform under the agreements. To mitigate this risk, we only enter into derivative financial instruments with counterparties with high credit ratings and with major financial institutions with which we or our related parties may also have other financial relationships. We do not anticipate that any of the counterparties will fail to meet their obligations.

Cash Flow Hedges of Interest Rate Risk

We record all derivatives in our condensed consolidated balance sheets at fair value. The following table summarizes the terms of our outstanding interest rate cap agreements designated as cash flow hedges of interest rate risk at September 30, 2023 and December 31, 2022:


Interest Rate	Balance Sheet		Strike	Notional		Fair Value at
Derivative	Line Item	Underlying Instrument	Rate	Amount		September 30, 2023		December 31, 2022
Interest rate cap	Other assets	Floating Rate Loan	3.40%	$	1,400,000	$	12,712	$	23,337
Interest rate cap	Other assets	ILPT Floating Rate Loan	2.25%	$	1,235,000	38,610		49,796
						$	51,322	$	73,133

Interest rate caps designated as cash flow hedges involve the receipt of variable amounts from a counterparty if interest rates rise above the strike rate on the contract in exchange for an up-front premium. For derivatives designated and qualifying as cash flow hedges of interest rate risk, the gain or loss on the derivative is recorded in cumulative other comprehensive income and subsequently reclassified into interest expense in the same period during which the hedged transaction affects earnings. Gains and losses on the derivative representing hedge components excluded from the assessment of effectiveness are recognized over the life of the hedge on a systematic and rational basis, as documented at hedge inception in accordance with our accounting policy election. The earnings recognition of excluded components is presented in interest expense. Amounts reported in cumulative other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are made on our applicable debt.

In September 2022, in conjunction with the repayment of the then existing $1,385,158 bridge loan facility secured by 109 of our properties, we sold two interest rate cap instruments with an aggregate notional amount of $1,385,158, a strike rate equal to 2.70% and an original expiration date of March 15, 2023 for $7,740. As the underlying debt instrument that these interest rate caps were intended to hedge was repaid in its entirety and the related interest expense was no longer probable to occur, these interest rate caps were no longer designated as cash flow hedges and the remaining deferred gain was reclassified from cumulative other comprehensive income as a reduction of loss on early extinguishment of debt.

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INDUSTRIAL LOGISTICS PROPERTIES TRUST

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

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


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Amount of gain recognized in cumulative other comprehensive income	$	3,428	$	15,047	$	19,677	$	24,200
Amount reclassified from cumulative other comprehensive income into interest expense	(10,063)		761		(23,069)		1,678
Amount reclassified from cumulative other comprehensive income into loss on early extinguishment of debt	—		(6,961)		—		(6,961)
Unrealized (loss) gain on derivative instrument recognized in cumulative other comprehensive loss	$	(6,635)	$	8,847	$	(3,392)	$	18,917

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following information should be read in conjunction with our condensed consolidated financial statements and accompanying notes included in this Quarterly Report on Form 10-Q and with our 2022 Annual Report.

OVERVIEW (dollars in thousands, except per share and per square foot data)

We are a real estate investment trust, or REIT, organized under Maryland law. As of September 30, 2023, our portfolio was comprised of 413 consolidated properties containing approximately 59,983,000 rentable square feet located in 39 states, including 226 buildings, leasable land parcels and easements containing approximately 16,729,000 rentable square feet located on the island of Oahu, Hawaii, and 187 properties containing approximately 43,254,000 rentable square feet located in 38 other states. As of September 30, 2023, our 413 consolidated properties included 94 properties that we own in a consolidated joint venture in which we own a 61% equity interest, and our consolidated properties were approximately 98.9% leased to 304 different tenants with a weighted average remaining lease term (by annualized rental revenues) of approximately 8.2 years. As of September 30, 2023, we also owned a 22% equity interest in an unconsolidated joint venture, which owns 18 properties located in 12 states in the mainland United States containing approximately 11,726,000 rentable square feet that were 99.4% leased with an average remaining lease term (based on annualized rental revenues) of 6.4 years. We define annualized rental revenues as the annualized contractual base rents from our tenants pursuant to our lease agreements as of the measurement date, including straight line rent adjustments and estimated recurring expense reimbursements to be paid to us, and excluding lease value amortization.

Long term e-commerce trends and supply chain resiliency have resulted in high occupancy and increases in rents. We believe customer service expectations, growth in the number of households and demand for supply chain resiliency will keep demand for industrial properties strong for the foreseeable future. However, inflationary pressures and rising interest rates in the United States and globally, and global geopolitical hostilities and tensions, have given rise to economic uncertainty and have caused disruptions in the financial markets. These conditions have increased our cost of capital and negatively impacted our ability to reduce our leverage. An economic recession, or continued or intensified disruptions in the financial markets, could adversely affect our financial condition and that of our tenants, could adversely impact the ability or willingness of our tenants to renew our leases or pay rent to us, may restrict our access to and would likely increase our cost of capital, may impact our ability to sell properties and may cause the values of our properties and of our common shares or other securities to decline.

Property Operations

Occupancy data for our properties as of September 30, 2023 and 2022 were as follows (square feet in thousands):


	All Properties				Comparable Properties (1)
	As of September 30,				As of September 30,
	2023		2022		2023		2022
Total properties	413		413		285		285
Total rentable square feet (in thousands) (2)	59,983		59,962		33,462		33,440
Percent leased (3)	98.9	%	99.2	%	98.8	%	99.3	%

(1)Consists of properties that we owned continuously since January 1, 2022 and excludes three properties classified as held for sale at September 30, 2023.

(2)Subject to modest adjustments when space is remeasured or reconfigured for new tenants and when land leases are converted to building leases.

(3)Percent leased includes (i) space being fitted out for occupancy pursuant to existing leases as of September 30, 2023, if any, and (ii) space which is leased but is not occupied or is being offered for sublease by tenants, if any.

The average effective rental rates per square foot, as defined below, for our properties for the three and nine months ended September 30, 2023 and 2022 were as follows:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2023		2022		2023		2022
Average effective rental rates per square foot leased: (1)
All properties	$	7.44	$	6.96	$	7.40	$	6.96
Comparable properties (2)	$	7.42	$	6.95	$	6.73	$	6.43

(1)Average effective rental rates per square foot leased represents annualized rental revenues during the period specified divided by the average rentable square feet leased during the period specified.

(2)Consists of properties that we owned continuously since July 1, 2022 and January 1, 2022, respectively.

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During the three and nine months ended September 30, 2023, we entered into new and renewal leases as summarized in the following tables:


	Three Months Ended September 30, 2023
	New Leases			Renewals			Totals
Square feet leased during the period (in thousands)	64			694			758
Weighted average rental rate change (by rentable square feet)	(15.7)		%	16.9		%	13.5		%
Weighted average lease term by square feet (years)	4.9			4.0			4.1
Total leasing costs and concession commitments (1)	$	140		$	1,301		$	1,441
Total leasing costs and concession commitments per square foot (1)	$	2.21		$	1.87		$	1.90
Total leasing costs and concession commitments per square foot per year (1)	$	0.45		$	0.47		$	0.46


	Nine Months Ended September 30, 2023
	New Leases			Renewals			Totals
Square feet leased during the period (in thousands)	594			2,892			3,486
Weighted average rental rate change (by rentable square feet)	29.9		%	18.1		%	20.1		%
Weighted average lease term by square feet (years)	11.3			7.2			7.8
Total leasing costs and concession commitments (1)	$	3,220		$	4,053		$	7,273
Total leasing costs and concession commitments per square foot (1)	$	5.43		$	1.40		$	2.09
Total leasing costs and concession commitments per square foot per year (1)	$	0.48		$	0.20		$	0.27

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

During the nine months ended September 30, 2023, we completed rent resets for approximately 382,000 square feet of land at our Hawaii Properties at rental rates that were approximately 29.9% higher than prior rental rates. There were no rent resets during the three months ended September 30, 2023.

As shown in the table below, approximately 0.8% of our total leased square feet and 0.9% of our total annualized rental revenues as of September 30, 2023 are included in leases scheduled to expire by December 31, 2023. As of September 30, 2023, our lease expirations by year were as follows (dollars and square feet in thousands):


									% of Total		Cumulative
			% of Total		Cumulative %		Annualized		Annualized		% of Total
		Leased	Leased		of Total		Rental		Rental		Annualized
	Number of	Square Feet	Square Feet		Square Feet		Revenues		Revenues		Rental Revenues
Year	Tenants	Expiring (1)	Expiring (1)		Expiring (1)		Expiring		Expiring		Expiring
2023	9	489	0.8	%	0.8	%	$	3,903	0.9	%	0.9	%
2024	45	5,909	10.0	%	10.8	%	29,702		6.9	%	7.8	%
2025	35	4,802	8.1	%	18.9	%	28,591		6.6	%	14.4	%
2026	30	4,147	7.0	%	25.9	%	28,247		6.5	%	20.9	%
2027	37	8,694	14.7	%	40.6	%	52,333		12.1	%	33.0	%
2028	41	6,075	10.2	%	50.8	%	44,948		10.4	%	43.4	%
2029	22	4,378	7.4	%	58.2	%	23,391		5.4	%	48.8	%
2030	16	2,519	4.2	%	62.4	%	21,092		4.9	%	53.7	%
2031	17	3,265	5.5	%	67.9	%	25,592		5.9	%	59.6	%
2032	37	3,615	6.1	%	74.0	%	35,455		8.2	%	67.8	%
Thereafter	109	15,423	26.0	%	100.0	%	139,830		32.2	%	100.0	%
Total	398	59,316	100.0	%			$	433,084	100.0	%


Weighted average remaining lease term (in years)		7.1					8.2

(1)Leased square feet is pursuant to existing leases as of September 30, 2023 and includes (i) space being fitted out for occupancy, if any, and (ii) space which is leased but is not occupied or is being offered for sublease by tenants, if any.

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As of September 30, 2023, subsidiaries of FedEx Corporation and subsidiaries of Amazon.com Services, Inc. leased 21.9% and 7.7% of our total leased square feet, respectively, and represented 29.8% and 6.7% of our total annualized rental revenues, respectively.

Mainland Properties. As of September 30, 2023, our Mainland Properties represented approximately 72.0% of our annualized rental revenues. We generally will seek to renew or extend the terms of leases at our Mainland Properties as their expirations approach. Due to the capital that many of the tenants in our Mainland Properties have invested in these properties and because many of these properties appear to be of strategic importance to the tenants’ businesses, we believe that it is likely that these tenants will renew or extend their leases prior to their expirations. If we are unable to extend or renew our leases, it may be time consuming and expensive to relet some of these properties and the terms of any leases we may enter may be less favorable to us than the terms of our existing leases for those properties.

Hawaii Properties. As of September 30, 2023, our Hawaii Properties represented approximately 28.0% of our annualized rental revenues. As of September 30, 2023, certain of our Hawaii Properties are lands leased for rents that periodically reset based on fair market values, generally every ten years. Revenues from our Hawaii Properties have generally increased under our or our predecessors’ ownership as rents under the leases for those properties have been reset or renewed. Lease renewals, lease extensions, new leases and rental rates for our Hawaii Properties in the future will depend on prevailing market conditions when these lease renewals, lease extensions, new leases and rental rates are set. As rent reset dates or lease expirations approach at our Hawaii Properties, we generally negotiate with existing or new tenants for new lease terms. If we are unable to reach an agreement with a tenant on a rent reset, our Hawaii Properties’ leases typically provide that rent is reset based on an appraisal process. Despite our and our predecessors’ prior experience with rent resets, lease extensions and new leases in Hawaii, our ability to increase rents when rents reset, leases are extended, or leases expire depends upon market conditions which are beyond our control. Accordingly, we cannot be sure that the historical increases achieved at our Hawaii Properties will continue in the future.

The following table provides the annualized rental revenues scheduled to reset at our Hawaii Properties as of September 30, 2023:


	Annualized
	Rental Revenues
	Scheduled to Reset
Scheduled Rent Reset Year for Hawaii Properties	as of September 30, 2023

2023	$	—
2024	1,150
2025	989
2026	1,315
2027	795
2028 and thereafter	17,605
Total	$	21,854

As of September 30, 2023, $28,031, or 6.5%, of our annualized rental revenues are included in leases scheduled to expire by September 30, 2024 and 1.1% of our rentable square feet are currently vacant. Rental rates for which available space may be leased in the future will depend on prevailing market conditions when lease extensions, lease renewals or new leases are negotiated. Whenever we extend, renew or enter new leases for our properties, we intend to seek rents that are equal to or higher than our historical rents for the same properties; however, our ability to maintain or increase the rents for our current properties will depend in large part upon market conditions, which are beyond our control.

Tenant Review Process. Our manager, RMR, employs a tenant review process for us. RMR assesses tenants on an individual basis based on various applicable credit criteria. In general, depending on facts and circumstances, RMR evaluates the creditworthiness of a tenant based on information that is provided by the tenant and, in some cases, information that is publicly available or obtained from third party sources. RMR also may use a third party service to monitor the credit ratings of debt securities of our existing tenants whose debt securities are rated by a nationally recognized credit rating agency.

Disposition Activities

In March 2023, we received gross proceeds of $270 and recognized a $974 net loss on sale of real estate as a result of a property in Everett, Washington partially taken by eminent domain.

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For further information regarding our disposition activities, see Note 2 to our Condensed Consolidated Financial Statements included in Part I, Item 1 and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Our Investing and Financing Liquidity and Resources” of this Quarterly Report on Form 10-Q.

RESULTS OF OPERATIONS

Three Months Ended September 30, 2023 Compared to Three Months Ended September 30, 2022 (dollars and share amounts in thousands, except per share data)


	Comparable Properties Results (1)							Non-Comparable Properties Results (2)						Consolidated Results
	Three Months Ended September 30,							Three Months Ended September 30,						Three Months Ended September 30,
					$		%					$						$		%
	2023		2022		Change		Change	2023		2022		Change		2023		2022		Change		Change

Rental income	$	108,571	$	101,704	$	6,867	6.8%	$	1,571	$	1,511	$	60	$	110,142	$	103,215	$	6,927	6.7%

Operating expenses:
Real estate taxes	14,734		13,535		1,199		8.9%	192		214		(22)		14,926		13,749		1,177		8.6%
Other operating expenses	9,772		8,299		1,473		17.7%	135		154		(19)		9,907		8,453		1,454		17.2%
Total operating expenses	24,506		21,834		2,672		12.2%	327		368		(41)		24,833		22,202		2,631		11.9%

Net operating income (3)	$	84,065	$	79,870	$	4,195	5.3%	$	1,244	$	1,143	$	101	85,309		81,013		4,296		5.3%

Other expenses:
Depreciation and amortization														43,912		48,519		(4,607)		(9.5)%
General and administrative														7,712		9,110		(1,398)		(15.3)%
Acquisition and other transaction related costs														—		586		(586)		(100.0)%

Total other expenses														51,624		58,215		(6,591)		(11.3)%
Interest and other income														2,397		1,068		1,329		124.4%
Interest expense														(72,941)		(89,739)		16,798		(18.7)%


Loss on early extinguishment of debt														—		(21,370)		21,370		(100.0)%
Loss before income tax expense and equity in earnings of unconsolidated joint venture														(36,859)		(87,243)		50,384		(57.8)%
Income tax expense														(51)		(28)		(23)		82.1%
Equity in earnings of unconsolidated joint venture														719		3,297		(2,578)		(78.2)%
Net loss														(36,191)		(83,974)		47,783		(56.9)%
Net loss attributable to noncontrolling interest														10,079		38,347		(28,268)		(73.7)%
Net loss attributable to common shareholders														$	(26,112)	$	(45,627)	$	19,515	(42.8)%

Weighted average common shares outstanding (basic and diluted)														65,488		65,250		238		0.4%


Per common share data (basic and diluted):
Net loss attributable to common shareholders														$	(0.40)	$	(0.70)	$	0.30	(42.9)%

(1)Consists of properties that we owned continuously since July 1, 2022.

(2)Consists of three properties classified as held for sale at September 30, 2023 and one property we acquired during the period from July 1, 2022 to September 30, 2023.

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

References to changes in the income and expense categories below relate to the comparison of results for the three months ended September 30, 2023 compared to the three months ended September 30, 2022.

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Rental income. Rental income increased at certain of our comparable properties primarily due to increases from our leasing activity and rent resets. Rental income includes non-cash straight line rent adjustments of $3,414 and $3,794 for the 2023 and 2022 periods, respectively, and net amortization of acquired real estate leases and assumed real estate lease obligations of $252 and $250 for the 2023 and 2022 periods, respectively.

Real estate taxes. Real estate taxes at certain of our comparable properties increased due to higher assessed values.

Other operating expenses. Other operating expenses at certain of our comparable properties increased primarily due to increases in insurance expense and repairs and maintenance at certain of our properties.

Depreciation and amortization. The decrease in depreciation and amortization primarily reflects a decrease in the amortization of leasing costs relating to certain lease expirations since July 1, 2022 and the impact on depreciation expense of certain properties classified as held for sale in the comparable periods, partially offset by an increase in depreciation and amortization related to capital expenditures made since July 1, 2022.

General and administrative. The decrease in general and administrative expenses is primarily due to decreases in business management fees as a result of a decline in our average market capitalization and in professional fees in the 2023 period.

Acquisition and other transaction related costs. Acquisition and other transaction related costs primarily consist of costs related to acquisition and disposition activities that were not completed.

Interest and other income. The increase in interest and other income is primarily due to higher interest rates and average cash balances during the 2023 period as compared to the 2022 period.

Interest expense. The decrease in interest expense is due to lower average outstanding indebtedness during the 2023 period as compared to the 2022 period.

Loss on early extinguishment of debt. Loss on early extinguishment of debt primarily relates to the write off of unamortized costs related to the repayment of our $1,385,158 bridge loan facility in September 2022.

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

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

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Nine Months Ended September 30, 2023 Compared to Nine Months Ended September 30, 2022 (dollars and share amounts in thousands, except per share data)


	Comparable Properties Results (1)							Non-Comparable Properties Results (2)						Consolidated Results
	Nine Months Ended September 30,							Nine Months Ended September 30,						Nine Months Ended September 30,
					$		%					$						$		%
	2023		2022		Change		Change	2023		2022		Change		2023		2022		Change		Change

Rental income	$	166,912	$	160,004	$	6,908	4.3%	$	161,531	$	121,808	$	39,723	$	328,443	$	281,812	$	46,631	16.5%

Operating expenses:
Real estate taxes	23,087		21,761		1,326		6.1%	23,406		14,699		8,707		46,493		36,460		10,033		27.5%
Other operating expenses	14,944		13,611		1,333		9.8%	12,800		8,667		4,133		27,744		22,278		5,466		24.5%
Total operating expenses	38,031		35,372		2,659		7.5%	36,206		23,366		12,840		74,237		58,738		15,499		26.4%

Net operating income (3)	$	128,881	$	124,632	$	4,249	3.4%	$	125,325	$	98,442	$	26,883	254,206		223,074		31,132		14.0%

Other expenses:
Depreciation and amortization														134,278		114,096		20,182		17.7%
General and administrative														23,750		24,896		(1,146)		(4.6)%
Acquisition and other transaction related costs														—		586		(586)		(100.0)%
Loss on impairment of real estate														254		100,747		(100,493)		(99.7)%
Total other expenses														158,282		240,325		(82,043)		(34.1)%
Interest and other income														5,340		1,900		3,440		181.1%
Interest expense														(215,558)		(208,286)		(7,272)		3.5%
Loss on sale of real estate														(974)		(10)		(964)		n/m
Loss on equity securities														—		(5,758)		5,758		(100.0)%
Loss on early extinguishment of debt														(359)		(22,198)		21,839		(98.4)%
Loss before income tax expense and equity in earnings of unconsolidated joint venture														(115,627)		(251,603)		135,976		(54.0)%
Income tax expense														(113)		(113)		—		—%
Equity in earnings of unconsolidated joint venture														7,423		6,634		789		11.9%
Net loss														(108,317)		(245,082)		136,765		(55.8)%
Net loss attributable to noncontrolling interest														31,568		49,402		(17,834)		(36.1)%
Net loss attributable to common shareholders														$	(76,749)	$	(195,680)	$	118,931	(60.8)%

Weighted average common shares outstanding (basic and diluted)														65,389		65,228		161		0.2%


Per common share data (basic and diluted):
Net loss attributable to common shareholders														$	(1.17)	$	(3.00)	$	1.83	(61.0)%

n/m - not meaningful

(1)Consists of properties that we owned continuously since January 1, 2022.

(2)Consists of three properties held for sale as of September 30, 2023 and 125 properties we acquired during the period from January 1, 2022 to September 30, 2023.

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

References to changes in the income and expense categories below relate to the comparison of results for the nine months ended September 30, 2023 compared to the nine months ended September 30, 2022.

Rental income. The increase in rental income is primarily a result of our acquisition activities, which includes our acquisition of MNR in February 2022. Rental income increased at certain of our comparable properties primarily due to increases from our leasing activity and rent resets. Rental income includes non-cash straight line rent adjustments of $10,531 and $8,170 for the 2023 and 2022 periods, respectively, and net amortization of acquired real estate leases and assumed real estate lease obligations of $764 and $4,265 for the 2023 and 2022 periods, respectively.

Real estate taxes. The increase in real estate taxes primarily reflects our acquisition of MNR. Real estate taxes at certain of our comparable properties increased due to higher assessed values.

Other operating expenses. The increase in other operating expenses is primarily due to our acquisition of MNR and increases in insurance expenses and repairs and maintenance at certain of our properties, partially offset by a decrease in snow removal expenses at certain of our properties, during the 2023 period.

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Depreciation and amortization. The increase in depreciation and amortization primarily reflects the impact of the acquisition of MNR during the 2022 period.

Acquisition and other transaction related costs. Acquisition and other transaction related costs primarily consists of costs related to potential acquisition and disposition activities that were not completed.

Loss on impairment of real estate. During the 2023 period, we recognized a loss on impairment of real estate on one property that was classified as held for sale at September 30, 2023. During the 2022 period, we recognized a loss on impairment of real estate on 25 properties assumed in the acquisition of MNR.

Interest and other income. The increase in interest and other income is primarily due to higher interest rates and average cash balances during the 2023 period as compared to the 2022 period.

Interest expense. The increase in interest expense is primarily due to higher average outstanding indebtedness during the 2023 period as compared to the 2022 period, partially offset by lower amortization of debt costs in the 2023 period as compared to the 2022 period.

Loss on sale of real estate. Loss on sale of real estate was a result of a property in Everett, Washington partially taken by eminent domain during the 2023 period and a final adjustment to the sale of properties during the year ended December 31, 2021 in the 2022 period.

Loss on equity securities. Loss on equity securities represents the realized loss on the sale of certain equity securities we acquired as part of the acquisition of MNR during the 2022 period.

Loss on early extinguishment of debt. Loss on early extinguishment of debt primarily relates to prepayment penalties incurred upon the repayment of four mortgage loans in May 2023, the write off of unamortized costs related to the repayment of our $1,385,158 bridge loan facility in September 2022 and the write off of unamortized costs related to the termination of our unsecured revolving credit facility in February 2022.

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

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

Non-GAAP Financial Measures

We present certain “non-GAAP financial measures” within the meaning of the applicable rules of the Securities and Exchange Commission, or the SEC, including NOI, funds from operations, or FFO, attributable to common shareholders and normalized funds from operations, or Normalized FFO, attributable to common shareholders. These measures do not represent cash generated by operating activities in accordance with GAAP and should not be considered alternatives to net loss or net loss attributable to common shareholders as indicators of our operating performance or as measures of our liquidity. These measures should be considered in conjunction with net loss and net loss attributable to common shareholders as presented in our condensed consolidated statements of comprehensive income (loss). We consider these non-GAAP measures to be appropriate supplemental measures of operating performance for a REIT along with net loss and net loss attributable to common shareholders. We believe these measures provide useful information to investors because by excluding the effects of certain historical amounts, such as depreciation and amortization expense, they may facilitate a comparison of our operating performance between periods and with other REITs and, in the case of NOI, reflecting only those income and expense items that are generated and incurred at the property level may help both investors and management to understand the operations of our properties.

Net Operating Income

We calculate NOI as shown below. We define NOI as income from our rental of real estate less our property operating expenses. The calculation of NOI excludes certain components of net loss in order to provide results that are more closely related to our property level results of operations. NOI excludes amortization of capitalized tenant improvement costs and leasing commissions that we record as depreciation and amortization expense. We use NOI to evaluate individual and company-wide property level performance. Other real estate companies and REITs may calculate NOI differently than we do.

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The following table presents the reconciliation of net loss to NOI for the three and nine months ended September 30, 2023 and 2022 (dollars in thousands):


	Three Months Ended September 30,					Nine Months Ended September 30,
		2023		2022			2023		2022
Net loss		$	(36,191)	$	(83,974)		$	(108,317)	$	(245,082)
Equity in earnings of unconsolidated joint venture		(719)		(3,297)			(7,423)		(6,634)
Income tax expense		51		28			113		113
Loss before income tax expense and equity in earnings of unconsolidated joint venture		(36,859)		(87,243)			(115,627)		(251,603)
Loss on early extinguishment of debt		—		21,370			359		22,198
Interest and other income		(2,397)		(1,068)			(5,340)		(1,900)
Interest expense		72,941		89,739			215,558		208,286
Loss on sale of real estate		—		—			974		10
Loss on equity securities		—		—			—		5,758
General and administrative		7,712		9,110			23,750		24,896
Acquisition and other transaction related costs		—		586			—		586
Loss on impairment of real estate		—		—			254		100,747
Depreciation and amortization		43,912		48,519			134,278		114,096
NOI		$	85,309	$	81,013		$	254,206	$	223,074

NOI:
Hawaii Properties		$	22,572	$	20,049		$	67,313	$	64,087
Mainland Properties		62,737		60,964			186,893		158,987
NOI		$	85,309	$	81,013		$	254,206	$	223,074

Funds From Operations Attributable to Common Shareholders and Normalized Funds From Operations Attributable to Common Shareholders

We calculate FFO attributable to common shareholders and Normalized FFO attributable to common shareholders as shown below. FFO attributable to common shareholders is calculated on the basis defined by The National Association of Real Estate Investment Trusts, which is net loss attributable to common shareholders, calculated in accordance with GAAP, excluding loss on impairment of real estate, any gain or loss on sale of real estate, equity in earnings of unconsolidated joint venture and any realized and unrealized gains or losses on equity securities, plus real estate depreciation and amortization of consolidated properties and our proportionate share of FFO of unconsolidated joint venture properties and minus FFO adjustments attributable to noncontrolling interest, as well as certain other adjustments currently not applicable to us. In calculating Normalized FFO attributable to common shareholders, we adjust for the items shown below including similar adjustments for the unconsolidated joint venture, if any. FFO attributable to common shareholders and Normalized FFO attributable to common shareholders are among the factors considered by our Board of Trustees when determining the amount of distributions to our shareholders. Other factors include, but are not limited to, requirements to maintain our qualification for taxation as a REIT, limitations in the agreements governing our debt, the availability to us of debt and equity capital, our distribution rate as a percentage of the trading price of our common shares, or dividend yield, and our dividend yield compared to the dividend yields of other industrial REITs, our expectation of our future capital requirements and operating performance and our expected needs for and availability of cash to pay our obligations. Other real estate companies and REITs may calculate FFO attributable to common shareholders and Normalized FFO attributable to common shareholders differently than we do.

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The following table presents our calculation of FFO attributable to common shareholders and Normalized FFO attributable to common shareholders and reconciliations of net loss attributable to common shareholders to FFO attributable to common shareholders and Normalized FFO attributable to common shareholders for the three months ended September 30, 2023 and 2022 (dollars in thousands, except per share data):


	Three Months Ended September 30,					Nine Months Ended September 30,
		2023		2022			2023		2022
Net loss attributable to common shareholders		$	(26,112)	$	(45,627)		$	(76,749)	$	(195,680)
Depreciation and amortization		43,912		48,519			134,278		114,096
Equity in earnings of unconsolidated joint venture		(719)		(3,297)			(7,423)		(6,634)
Loss on equity securities		—		—			—		5,758
Share of FFO from unconsolidated joint venture		1,446		1,678			4,416		5,115
Loss on impairment of real estate		—		—			254		100,747
Loss on sale of real estate		—		—			974		10
FFO adjustments attributable to noncontrolling interest		(10,582)		(11,407)			(32,514)		(27,445)
FFO attributable to common shareholders		7,945		(10,134)			23,236		(4,033)
Loss on early extinguishment of debt		—		21,370			359		22,198
Acquisition, transaction related and certain other financing costs (1)		—		32,016			—		80,992
Normalized FFO adjustments attributable to noncontrolling interest		—		(28,379)			(140)		(28,379)
Normalized FFO attributable to common shareholders		$	7,945	$	14,873		$	23,455	$	70,778

Weighted average common shares outstanding (basic and diluted)		65,488		65,250			65,389		65,228


Per common share data (basic and diluted):
FFO attributable to common shareholders		$	0.12	$	(0.16)		$	0.36	$	(0.06)
Normalized FFO attributable to common shareholders		$	0.12	$	0.23		$	0.36	$	1.09

(1)Amounts for the three and nine months ended September 30, 2022 primarily include certain debt issuance costs recognized as interest expense related to the then existing bridge loan facility and other transaction related costs expensed under GAAP.

LIQUIDITY AND CAPITAL RESOURCES

Our Operating Liquidity and Resources (dollars in thousands)

Our principal sources of funds to meet our operating and capital expenses, pay debt service obligations and make distributions to our shareholders are rents from tenants at our properties. As of September 30, 2023, investment grade rated tenants, subsidiaries of investment grade rated parent entities or our Hawaii land leases represented 77.2% of our annualized rental revenues and only 6.5% of our annualized rental revenues were from leases expiring over the next 12 months. We believe that these sources of funds will be sufficient to meet our operating and capital expenses, pay debt service obligations and make distributions to our shareholders for the next 12 months and for the foreseeable future thereafter.

Our future cash flows from operating activities will depend primarily upon our ability to:

•collect rents from our tenants when due;

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

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

•purchase additional properties that produce cash flows in excess of our costs of acquisition capital and property operating expenses; and

•develop properties to produce cash flows in excess of our costs of capital.

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


	Nine Months Ended September 30,
	2023		2022
Cash and cash equivalents and restricted cash at beginning of period	$	140,780	$	29,397
Net cash provided by (used in):
Operating activities	14,063		81,907
Investing activities	31,420		(3,457,034)
Financing activities	36,240		3,472,399
Cash and cash equivalents and restricted cash at end of period	$	222,503	$	126,669

The decrease in net cash provided by operating activities for the nine months ended September 30, 2023 compared to the prior year is primarily due to higher interest expense paid in the 2023 period, partially offset by higher cash flows from the properties we acquired pursuant to our acquisition of MNR in February 2022. The change in net cash provided by investing activities is primarily due to our acquisition of MNR in February 2022 as compared to no acquisitions during the 2023 period. The decrease in net cash provided by financing activities was primarily due to proceeds from borrowings and sale of joint venture equity interests to finance our acquisition of MNR in the 2022 period.

Our Investing and Financing Liquidity and Resources (dollars in thousands, except per share and per square foot data)

Our future acquisition or development activity cannot be accurately projected because such activity depends upon available opportunities that come to our attention, our ability to successfully acquire and develop properties, financing available to us, our cost of capital, other commitments we have made and alternative uses for the amounts that would be required for the acquisition or development, the extent of our leverage, and the expected impact of the acquisition or development on certain of our financial metrics and debt covenants. We generally do not intend to purchase “turn around” properties, or properties that do not generate positive cash flows, but we may conduct construction or redevelopment activities on our properties.

As of September 30, 2023, we had cash and cash equivalents, excluding restricted cash, of $83,283. To maintain our qualification for taxation as a REIT under the Internal Revenue Code of 1986, as amended, or the IRC, we generally are required to distribute at least 90% of our REIT taxable income annually, subject to specified adjustments and excluding any net capital gain. This distribution requirement limits our ability to retain earnings and thereby provide capital for our operations or acquisitions. We may use our cash and cash equivalents on hand, the cash flow from our operations, net proceeds from any sales of assets and net proceeds of offerings of equity or debt securities to fund our distributions to our shareholders.

The ILPT Floating Rate Loan matures in October 2024, subject to three, one year extension options, and requires that interest be paid at an annual rate of SOFR plus a weighted average premium of 3.93%. The weighted average interest rate payable under the ILPT Floating Rate Loan was 6.18%, including the impact of our interest rate cap on SOFR of 2.25%, for both the three and nine months ended September 30, 2023. Beginning in October 2023, subject to the satisfaction of certain conditions, we have the option to prepay the ILPT Floating Rate Loan in full or in part at any time at par with no premium.

The Floating Rate Loan matures in March 2024, subject to three, one year extension options, and requires that interest be paid at an annual rate of SOFR plus a premium of 2.77%. The weighted average annual interest rate payable under the Floating Rate Loan was 6.17%, including the impact of our interest rate cap on SOFR of 3.40%, for both the three and nine months ended September 30, 2023. The weighted average annual interest rate payable under the Floating Rate Loan was 4.94% and 4.23% for the three months ended September 30, 2022 and the period from February 25, 2022 to September 30, 2022, respectively. Subject to the satisfaction of certain conditions, we have the option to prepay up to $280,000 of the Floating Rate Loan at par with no premium, and to prepay the balance of the Floating Rate Loan at any time, subject to a premium.

The one year options to extend the Floating Rate Loan and the ILPT Floating Rate Loan require, among other things, that we obtain a replacement interest rate cap, as defined in the applicable agreement.

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As of September 30, 2023, we had an aggregate principal amount of $4,330,370 of debt, including the Floating Rate Loan and the ILPT Floating Rate Loan, scheduled to mature between 2024 and 2038.

For further information regarding our investing and financing activities, see Notes 2 and 4 to our Condensed Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

Consolidated Joint Venture

We own a 61% equity interest in Mountain Industrial REIT LLC, which owns 94 properties in 27 states totaling approximately 20,981,000 rentable square feet. We control our consolidated joint venture and therefore account for the properties owned by this joint venture on a consolidated basis in our condensed consolidated financial statements. We recognized a 39% noncontrolling interest in our condensed consolidated financial statements for the three months ended September 30, 2023 and 2022, for the nine months ended September 30, 2023 and the period from this joint venture’s formation date, February 25, 2022 to September 30, 2022. The portion of this joint venture's net loss not attributable to us, or $10,238 and $38,318, for the three months ended September 30, 2023 and 2022, respectively, and $31,642 and $49,360 for the nine months ended September 30, 2023 and for the period from February 25, 2022 to September 30, 2022, respectively, is reported as net loss attributable to noncontrolling interest in our condensed consolidated statements of comprehensive income (loss). As of September 30, 2023, our consolidated joint venture had total assets of $3,065,834 and total liabilities of $1,781,222.

Unconsolidated Joint Venture

We own a 22% equity interest in The Industrial Fund REIT LLC, which owns 18 industrial properties located in 12 states totaling approximately 11,726,000 rentable square feet. We account for the unconsolidated joint venture under the equity method of accounting under the fair value option. We recognize changes in the fair value of our investment in the unconsolidated joint venture as equity in earnings of unconsolidated joint venture in our condensed consolidated statements of comprehensive income (loss). In addition, the unconsolidated joint venture made aggregate cash distributions to us of $5,390 and $1,320 during the three months ended September 30, 2023 and 2022, respectively, and $7,370 and $3,962 for the nine months ended September 30, 2023 and 2022, respectively.

For further information regarding these joint ventures, see Note 2 to our Condensed Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

We expect to use proceeds we may receive from the other investors in our joint ventures in connection with any additional properties we may sell to our joint ventures, equity contributions from any third party investors in our joint ventures or any future joint ventures and net proceeds from offerings of equity or debt securities to fund any future property acquisitions, developments and redevelopments. We may also assume mortgage loans or incur debt in connection with future acquisitions, developments and redevelopments. When the maturities of our debt approach or we desire to reduce our leverage or refinance debt, we intend to explore refinancing alternatives, property sales or sales of equity interests in joint ventures. Such alternatives may include incurring term debt, obtaining financing secured by mortgages on properties we own, issuing new equity or debt securities, obtaining a revolving credit facility, participating or selling equity interests in joint ventures or selling properties. We currently have an effective shelf registration statement that allows us to issue up to $500,000 in aggregate amount of public securities on an expedited basis, but we cannot be sure that there will be purchasers for such securities. Further, any issuances of our equity securities may be dilutive to our existing shareholders. Although we cannot be sure that we will be successful in completing any particular type of financing, we believe that we will have access to financing, such as debt or equity offerings, to fund capital expenditures, future acquisitions, development, redevelopment and other activities and to pay our obligations.

The completion and the costs of any future financings will depend primarily upon our success in operating our business and upon market conditions. In particular, the feasibility and cost of any future debt financings will depend primarily on our then current credit qualities and on market conditions. We have no control over market conditions. Potential lenders in future debt transactions will evaluate our ability to fund required debt service and repay principal balances when they become due by reviewing our financial condition, results of operations, business practices and plans and our ability to maintain our earnings, to stagger our debt maturities and to balance our use of debt and equity capital so that our financial performance and leverage ratios afford us flexibility to withstand any reasonably anticipated adverse changes. We intend to conduct our business activities in a manner which will afford us reasonable access to capital for investing and financing activities.

During the nine months ended September 30, 2023, we paid quarterly cash distributions to our shareholders totaling $1,968 using cash balances.

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On October 12, 2023, we declared a regular quarterly distribution to common shareholders of record on October 23, 2023 of $0.01 per share, or approximately $658. We expect to pay this distribution to our shareholders on or about November 16, 2023 using cash balances. For more information regarding these distributions, see Note 6 to our Condensed Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

During the three and nine months ended September 30, 2023 and 2022, amounts capitalized for tenant improvements, leasing costs, building improvements and development and redevelopment activities were as follows:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2023		2022		2023		2022
Tenant improvements and leasing costs (1)	$	1,241	$	2,302	$	5,779	$	8,290
Building improvements (2)	2,720		1,292		4,373		1,778
Development, redevelopment and other activities (3)	1,314		4,980		7,705		12,351
	$	5,275	$	8,574	$	17,857	$	22,419

(1)Tenant improvements and leasing costs include capital expenditures used to improve tenants’ space or amounts paid directly to tenants to improve their space and leasing related costs, such as brokerage commissions and tenant inducements.

(2)Building improvements generally include expenditures to replace obsolete building components and expenditures that extend the useful life of existing assets.

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

As of September 30, 2023, we had estimated unspent leasing related obligations of $5,923, of which $3,529 is expected to be spent during the next 12 months.

Debt Covenants (dollars in thousands)

Our principal debt obligations as of September 30, 2023 were: (1) $1,235,000 outstanding principal amount of the ILPT Floating Rate Loan secured by 104 of our properties; (2) $1,400,000 outstanding principal amount of the Floating Rate Loan secured by 82 properties owned by our consolidated joint venture; (3) $700,000 outstanding principal amount of a mortgage loan secured by 17 our properties; (4) $650,000 outstanding principal amount of a mortgage loan secured by 186 of our Hawaii Properties; and (5) $345,370 aggregate principal amount of mortgage loans secured by 12 properties owned by our consolidated joint venture in which we own a 61% equity interest. For further information regarding our indebtedness, see Note 4 to our Condensed Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

The agreements and related documents governing the ILPT Floating Rate Loan, the Floating Rate Loan, the $700,000 mortgage loan and the $650,000 mortgage loan contain customary covenants, provide for acceleration of payment of all amounts due thereunder upon the occurrence and continuation of certain events of default and, in the case of the $650,000 mortgage loan, also require us to maintain a minimum consolidated net worth of at least $250,000 and liquidity of at least $15,000. As of September 30, 2023, we believe that we were in compliance with all of the covenants and other terms under the agreements governing these loans.

Certain of the mortgage loans we assumed in connection with our acquisition of MNR are non-recourse, subject to certain limitations, and do not contain any material financial covenants. The agreements governing the ILPT Floating Rate Loan, the Floating Rate Loan, the $700,000 mortgage loan and the $650,000 mortgage loan contain certain exceptions to the general non-recourse provisions, including our obligation to indemnify the lenders for certain potential environmental losses.

Related Person Transactions

We have relationships and historical and continuing transactions with RMR, RMR Inc. and others related to them. For further information about these and other such relationships and related person transactions, see Notes 7 and 8 to our Condensed Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q, our 2022 Annual Report, our definitive Proxy Statement for our 2023 Annual Meeting of Shareholders and our other filings with the SEC. In addition, see the section captioned “Risk Factors” of our 2022 Annual Report for a description of risks that may arise as a result of these and other related person transactions and relationships. We may engage in additional transactions with related persons, including businesses to which RMR or its subsidiaries provide management services.

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Critical Accounting Estimates

The preparation of our condensed consolidated financial statements in conformity with GAAP requires us to make estimates and assumptions that affect reported amounts. Actual results could differ from those estimates. Significant estimates in the condensed consolidated financial statements include purchase price allocations, useful lives of fixed assets and assessment of impairment of real estate and related intangibles.

A discussion of our critical accounting estimates is included in our 2022 Annual Report. There have been no significant changes in our critical accounting estimates since the year ended December 31, 2022.

Item 3. Quantitative and Qualitative Disclosures About Market Risk (dollars in thousands, except per share data)

We are exposed to risks associated with market changes in interest rates. We manage our exposure to this market risk by monitoring available financing alternatives. Our strategy to manage exposure to changes in interest rates is materially unchanged since December 31, 2022. Other than as described below, we do not currently expect any significant changes in our exposure to fluctuations in interest rates or in how we manage this exposure in the near future.

Floating Rate Debt

At September 30, 2023, our outstanding floating rate debt consisted of the following:


			Annual		Annual			Interest
	Principal		Interest		Interest			Payments
Debt	Balance		Rate (1)		Expense (1)		Maturity	Due
ILPT Floating Rate Loan	$	1,235,000	6.18	%	$	77,383	2024	Monthly
Floating Rate Loan	1,400,000		6.17	%	87,580		2024	Monthly
	$	2,635,000			$	164,963

(1)The annual interest rate and annual interest expense are the amounts stated in the applicable contract, as adjusted by our interest rate caps as applicable.

At September 30, 2023, our aggregate floating rate debt was $2,635,000, consisting of the $1,235,000 outstanding principal amount of the ILPT Floating Rate Loan, and the $1,400,000 outstanding principal amount of the Floating Rate Loan secured by 82 properties owned by our consolidated joint venture. The ILPT Floating Rate Loan matures on October 9, 2024, subject to three, one year extension options, and requires that interest be paid at an annual rate of SOFR plus a weighted average premium of 3.93%. The Floating Rate Loan matures on March 9, 2024, subject to three, one year extension options, and requires that interest be paid at an annual rate of SOFR plus a premium of 2.77%. We are vulnerable to changes in the U.S. dollar based on short term rates, specifically SOFR. In conjunction with these borrowings, to hedge our exposure to risks related to changes in SOFR rates, we purchased interest rate caps with a SOFR strike rate equal to 2.25% for the ILPT Floating Rate Loan and 3.40% for the Floating Rate Loan.

In addition, upon renewal or refinancing of these obligations, we are vulnerable to increases in interest rate premiums due to market conditions and our perceived credit risk. Generally, a change in interest rates would not affect the value of our floating rate debt but would affect our operating results. The following table presents the approximate impact a one percentage point increase in interest rates would have on our annual floating rate interest expense at September 30, 2023, excluding the impact of our interest rate caps:


	Impact of an Increase in Interest Rates
					Total Interest		Annual
	Interest Rate		Outstanding		Expense		Earnings Per
	Per Year		Debt		Per Year		Share Impact (1)
At September 30, 2023	6.17	%	$	2,635,000	$	164,963	$	2.52
One percentage point increase	7.17	%	$	2,635,000	$	191,679	$	2.93

(1)Based on the diluted weighted average common shares outstanding for the nine months ended September 30, 2023.

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The foregoing table shows the impact of an immediate one percentage point change in floating interest rates. If interest rates were to change gradually over time, the impact would be spread over time. Our exposure to fluctuations in floating interest rates will increase or decrease in the future with increases or decreases in the outstanding amounts of any floating rate debt we may incur.

Fixed Rate Debt

At September 30, 2023, our outstanding fixed rate debt consisted of the following mortgage notes:


			Annual		Annual			Interest
	Principal		Interest		Interest			Payments
Debt	Balance		Rate (1)		Expense (1)		Maturity	Due
Mortgage notes (186 Hawaii Properties)	$	650,000	4.31	%	$	28,015	2029	Monthly
Mortgage notes (17 Mainland Properties)	700,000		4.42	%	30,940		2032	Monthly
Mortgage note (2)	91,000		6.25	%	5,688		2030	Monthly
Mortgage note (3)	11,712		3.67	%	430		2031	Monthly
Mortgage note (3)	13,228		4.14	%	548		2032	Monthly
Mortgage note (3)	29,213		4.02	%	1,174		2033	Monthly
Mortgage note (3)	40,832		4.13	%	1,686		2033	Monthly
Mortgage note (3)	24,873		3.10	%	771		2035	Monthly
Mortgage note (3)	40,087		2.95	%	1,183		2036	Monthly
Mortgage note (3)	44,423		4.27	%	1,897		2037	Monthly
Mortgage note (3)	50,002		3.25	%	1,625		2038	Monthly
	$	1,695,370			$	73,957

(1)The annual interest rate and annual interest expense are the amounts stated in the applicable contract.

(2)Our consolidated joint venture, in which we own a 61% equity interest, obtained this mortgage loan, which is secured by four properties.

(3)Our consolidated joint venture, in which we own a 61% equity interest, assumed these former MNR mortgage loans, which are secured by eight properties in aggregate.

Our $650,000, $700,000 and $91,000 mortgage notes require interest only payments until maturity. The remaining fixed rate mortgage notes require amortizing payment of principal and interest until maturity. Because our mortgage notes require interest to be paid at a fixed rate, changes in market interest rates during the terms of these mortgage notes will not affect our interest obligations. If these mortgage notes are refinanced at an interest rate which is one percentage point higher or lower than shown above, our annual interest cost would increase or decrease by approximately $16,953.

Changes in market interest rates would affect the fair value of our fixed rate debt obligations. Increases in market interest rates decrease the fair value of our fixed rate debt, while decreases in market interest rates increase the fair value of our fixed rate debt. The U.S. Federal Reserve has raised interest rates multiple times since the beginning of 2022 in an effort to combat inflation and may continue to do so. Based on the balances outstanding at September 30, 2023 and discounted cash flow analyses through the maturity date, and assuming no other changes in factors that may affect the fair value of our fixed rate debt obligation, a hypothetical immediate one percentage point change in the interest rates would change the fair value of these obligations by approximately $89,267.

Item 4. Controls and Procedures

As of the end of the period covered by this Quarterly Report on Form 10-Q, 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 Securities Exchange Act of 1934, as amended. 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 September 30, 2023 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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Warning Concerning Forward-Looking Statements

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other securities laws that are subject to risks and uncertainties. These statements may include words such as “believe”, “expect”, “anticipate”, “intend”, “plan”, “estimate”, “will”, “may” and negatives or derivatives of these or similar expressions. These forward-looking statements include, among others, statements about: economic and market conditions; our expectations regarding the demand for industrial properties; our future leasing activity; our leverage levels and possible future financings; our liquidity needs and sources; our capital expenditure plans and commitments; acquisitions and dispositions; our existing and possible future joint venture arrangements; our redevelopment and construction activities and plans; and the amount and timing of future distributions.

Forward-looking statements reflect our current expectations, are based on judgments and assumptions, are inherently uncertain and are subject to risks, uncertainties and other factors, which could cause our actual results, performance or achievements to differ materially from expected future results, performance or achievements expressed or implied in those forward-looking statements. Some of the risks, uncertainties and other factors that may cause our actual results, performance or achievements to differ materially from those expressed or implied by forward-looking statements include, but are not limited to, the following:

•Demand for industrial and logistics properties,

•Our ability and the ability of our tenants to operate under unfavorable market and economic conditions, such as rising or sustained high interest rates, high inflation, labor market challenges, disruption and volatility in the public equity and debt markets, challenges in the commercial real estate industry generally and in the industrial and logistics sector, global geopolitical hostilities and tensions and economic recessions or downturns,

•Our ability to successfully compete for tenancies, the likelihood that the rents we realize will increase when we renew or extend our leases, enter new leases, or our rents reset at our properties in Hawaii,

•Whether our tenants will renew or extend their leases or that we will be able to obtain replacement tenants on terms as favorable to us as the terms of our existing leases,

•Our ability to maintain high occupancy at our properties,

•Our tenant and geographic concentrations,

•Our ability to reduce our leverage, generate cash flow and take advantage of mark-to-market leasing opportunities,

•Our ability to cost-effectively raise and balance our use of debt or equity capital,

•Our ability to purchase cost effective interest rate caps,

•Our ability to pay interest on and principal of our debt,

•Our ability to maintain sufficient liquidity,

•Non-performance by the counterparties to our interest rate caps and the costs for renewing or replacing the interest rate caps,

•Our tenants’ ability and willingness to pay their rent obligations to us,

•The credit qualities of our tenants,

•Changes in the security of cash flows from our properties,

•Potential defaults of our leases by our tenants,

•Changes in global supply chain conditions and emerging technologies,

•Whether the industrial and logistics sector and the extent to which our tenants’ businesses are critical to sustaining a resilient supply chain and that our business will benefit as a result,

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•Acts of terrorism, outbreaks or continuation of pandemics or other significant adverse public health safety events or conditions, war or other hostilities, supply chain disruptions, climate change or other manmade or natural disasters beyond our control,

•Our ability to pay distributions to our shareholders and to increase or sustain the amount of such distributions,

•Our ability to sell properties at prices we target,

•Our ability to complete pending sales without delay, or at all, at existing agreement terms,

•Our ability to prudently pursue, and successfully and profitably complete, expansion and renovation projects at our properties and to realize our expected returns on those projects,

•Our expected capital expenditures and leasing costs, as well as risks and uncertainties regarding the development, redevelopment or repositioning of our properties, including as a result of inflation, cost overruns, supply chain challenges, labor shortages, construction delays or inability to obtain necessary permits, and our ability to lease space at these properties at targeted returns,

•Our ability to sell additional equity interests in, or contribute additional properties to, our existing joint ventures, or enter into additional, real estate joint ventures or to attract co-venturers and benefit from our existing joint ventures or any real estate joint ventures we may enter into,

•The ability of our manager, RMR, to successfully manage us,

•Changes in environmental laws or in their interpretations or enforcement as a result of climate change or otherwise, or our incurring environmental remediation costs or other liabilities,

•Competition within the commercial real estate industry, particularly for industrial and logistics properties in those markets in which our properties are located,

•Compliance with, and changes to, federal, state and local laws and regulations, accounting rules, tax laws and similar matters,

•Limitations imposed on our business and our ability to satisfy complex rules in order for us to maintain our qualification for taxation as a REIT for U.S. federal income tax purposes,

•Actual and potential conflicts of interest with our related parties, including our managing trustees, RMR and others affiliated with them,

•Our ability to acquire properties that realize our targeted returns, and

•Other matters.

These risks, uncertainties and other factors are not exhaustive and should be read in conjunction with other cautionary statements that are included in our periodic filings. The information contained elsewhere in our filings with the SEC, including under the caption “Risk Factors” in our periodic reports, or incorporated therein, identifies important factors that could cause differences from our forward-looking statements in this Quarterly Report on Form 10-Q. Our filings with the SEC are available on the SEC’s website at www.sec.gov.

You should not place undue reliance upon our forward-looking statements.

Except as required by law, we do not intend to update or change any forward-looking statements as a result of new information, future events or otherwise.

Statement Concerning Limited Liability

The Amended and Restated Declaration of Trust establishing Industrial Logistics Properties Trust, dated January 11, 2018, as amended, as filed with the State Department of Assessments and Taxation of Maryland, provides that no trustee, officer, shareholder, employee or agent of Industrial Logistics Properties Trust shall be held to any personal liability, jointly or severally, for any obligation of, or claim against, Industrial Logistics Properties Trust. All persons dealing with Industrial Logistics Properties Trust in any way shall look only to the assets of Industrial Logistics Properties Trust for the payment of any sum or the performance of any obligation.

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PART II. Other Information

Item 1A. Risk Factors

There have been no material changes to the risk factors from those we previously provided in our 2022 Annual Report.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Issuer purchases of equity securities. The following table provides information about our purchases of our equity securities during the quarter ended September 30, 2023:


					Maximum
				Total Number of	Approximate Dollar
				Shares Purchased	Value of Shares that
	Number of	Average		as Part of Publicly	May Yet Be Purchased
	Shares	Price Paid		Announced Plans	Under the Plans or
Calendar Month	Purchased (1)	per Share		or Programs	Programs
July 1, 2023 - July 31, 2023	1,017	$	3.65	—	$	—
September 1, 2023 - September 30, 2023	39,619	$	3.54	—	$	—
Total	40,636	$	3.54	—	$	—

(1) These common share withholdings and purchases were made to satisfy tax withholding and payment obligations of our officers and certain other current and former employees of RMR in connection with the vesting of prior awards of common shares to them. We withheld and purchased these common shares at their fair market values based upon the trading prices of our common shares at the close of trading on Nasdaq on the purchase dates.

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Item 6. Exhibits


Exhibit Number			Description

3.1			Composite Copy of Amended and Restated Declaration of Trust of the Company, dated as of January 11, 2018, 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			Second Amended and Restated Bylaws of the Company, adopted June 1, 2023. (Incorporated by reference to the Company’s Current Report on Form 8-K filed on June 2, 2023.)

4.1			Form of Common Share Certificate. (Incorporated by reference to Amendment No. 2 to the Company's Registration Statement on Form S-11, File No. 333-221708.)

10.1			Form of Share Award Agreement . (Filed herewith.)

10.2			F orm of Ind emnification Agreement . (Filed herewith.)



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.)


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.)

SIGNATURES

Pursuant to the requirements 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.


			INDUSTRIAL LOGISTICS PROPERTIES TRUST


			By:			/s/ Yael Duffy
						Yael Duffy
						President and Chief Operating Officer
						Dated: October 25, 2023


			By:			/s/ Tiffany R. Sy
						Tiffany R. Sy
						Chief Financial Officer and Treasurer
						(Principal Financial Officer and Principal Accounting Officer)
						Dated: October 25, 2023

Exhibit 10.1

FORM OF

INDUSTRIAL LOGISTICS PROPERTIES TRUST

Share Award Agreement

This Share Award Agreement (this “Agreement”) is made as of «DATE», 2023, between «NAME» (the “Recipient”) and Industrial Logistics Properties Trust (the “Company”).

In consideration of the mutual promises and covenants contained in this Agreement, and for other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1. Award of Shares. Subject to the terms and conditions hereinafter set forth and the terms and conditions of the Industrial Logistics Properties Trust 2018 Equity Compensation Plan, as it may be amended from time to time (the “Plan”), the Company hereby awards to the Recipient, effective as of the date of this Agreement, «NUMBER» of its common shares of beneficial interest, par value $.01 per share (the “Common Shares”). The shares so awarded are hereinafter referred to as the “Shares,” which term shall also include any shares of the Company issued to the Recipient by virtue of his or her ownership of the Shares, by share dividend, share split or combination, recapitalization or otherwise.

2. Vesting; Forfeiture of Shares.

(a) Subject to Sections 2(b) and 2(c) hereof, the Shares shall vest one-fifth of the total number of Shares as of the date hereof and as to a further one-fifth of such total number of Shares on each anniversary of the date hereof for the next four calendar years. Any Shares not vested as of any date are herein referred to as “Unvested Shares.”

(b) Subject to Section 2(c) hereof, at the option of the Company, in the event the Recipient ceases to render significant services, whether as an employee or otherwise, to (i) the Company, (ii) the entity which is the manager or shared services provider to the Company or an entity controlled by, under common control with or controlling such entity (collectively, the “Manager”), or (iii) an affiliate of the Company (which shall be deemed for such purpose to include any other entity to which the Manager is the manager or shared services provider), all or any portion of the Unvested Shares shall be forfeited by the Recipient on or after the date the Recipient ceases to render all such services, as determined by the Company. The Company may exercise such option by delivering or mailing to the Recipient (or his or her estate), at any time after the Recipient has ceased to render such services, a written notice of exercise of such option. Such notice shall specify the number of Unvested Shares to be forfeited.

(c) Notwithstanding anything in this Agreement to the contrary, immediately upon the occurrence of an Acceleration Event (as defined below), all of the Unvested Shares shall vest and any forfeiture or other rights of the Company described in Section 2(b) shall lapse in their entirety, and such vesting and lapse of forfeiture or other Company rights shall also immediately apply to each other Common Share previously awarded to the Recipient which then remains subject to comparable restrictions and rights. For purposes of this Section 2(c), an Acceleration Event shall be deemed to occur immediately upon the occurrence of any of the following events: a Change in Control, a Termination Event (as each such term is defined in Exhibit A hereto) or the death of the Recipient. By executing this Agreement, the Recipient hereby agrees and acknowledges that the provisions of Exhibit A hereto shall apply to each award of Common Shares of the Company previously awarded to the Recipient which remains subject to comparable vesting restrictions (“Prior Awards”) and shall supersede the corresponding provisions of such Prior Awards.

3. Legends. Vested and Unvested Shares awarded under this Agreement may bear or contain, as applicable, such legends and notations as may be required by the Plan or the Company’s declaration of trust, any applicable supplement thereto or bylaws, each as in effect from time to time, or as the Company may otherwise determine appropriate.

Promptly following the request of the Recipient with respect to any Shares (or any other Common Shares previously awarded to the Recipient), the Company shall take, at its sole cost and expense, all such actions as may be required to permit the Recipient to sell such shares including, as applicable and without limitation, providing to the Company’s transfer agent certificates of officers of the Company, and opinions of counsel and/or filing an appropriate registration statement, and taking all such other actions as may be required to remove the legends set forth above with respect to transfer and vesting restrictions from the certificates evidencing such shares and, if applicable, from the share books and records of the Company. The Company shall reimburse the Recipient, promptly upon the receipt of a request for payment, for all expenses (including legal expenses) reasonably incurred by the Recipient in connection with the enforcement of the Recipient’s rights under this paragraph.

4. Tax Withholding. To the extent required by law, the Company or the Manager shall withhold or cause to be withheld income and other taxes incurred by the Recipient by reason of an award of Common Shares, and the Recipient agrees that he or she shall, upon the request of the Company or the Manager, pay to the Company or to the Manager an amount sufficient to satisfy his or her tax withholding obligations from time to time (including as Shares become vested).

5. Miscellaneous.

(a) Amendments. Neither this Agreement nor any provision hereof may be changed or modified except by an agreement in writing executed by the Recipient and the Company; provided, however, that any change or modification that does not adversely affect the rights hereunder of the Recipient, as they may exist immediately prior to the effective date of such change or modification, may be adopted by the Company without an agreement in writing executed by the Recipient, and the Company shall give the Recipient written notice of such change or modification reasonably promptly following the adoption of such change or modification.

(b) Binding Effect of the Agreement. This Agreement shall inure to the benefit of, and be binding upon , the Company, the Recipient and their respective estates, heirs, executors, transferees, successors, assigns and legal representatives.

(c) Provisions Separable. In the event that any of the terms of this Agreement shall be or become or is declared to be illegal or unenforceable by any court or other authority of competent jurisdiction, such terms shall be null and void and shall be deemed deleted from this Agreement, and all the remaining terms of this Agreement shall remain in full force and effect.

(d) Notices. Any notice in connection with this Agreement shall be deemed to have been properly delivered if it is in writing and is delivered by hand or by facsimile or sent by registered certified mail, postage prepaid, to the party addressed as follows, unless another address has been substituted by notice so given:

To the Recipient: To the Recipient’s address as set forth on the signature page hereof.

To the Company: Industrial Logistics Properties Trust

Two Newton Place

255 Washington Street, Suite 300

Newton, MA 02458

Attn: Secretary

(e) Construction. The headings and subheadings of this Agreement have been inserted for convenience only, and shall not affect the construction of the provisions hereof. All references to sections of this Agreement shall be deemed to refer as well to all subsections which form a part of such section.

(f) Employment Agreement. This Agreement shall not be construed as an agreement by the Company, the Manager or any affiliate of the Company or the Manager to employ the Recipient, nor is the Company, the Manager or any affiliate of the Company or the Manager obligated to continue employing the Recipient by reason of this Agreement or the award of the Shares to the Recipient hereunder.

(g) Applicable Law. This Agreement shall be construed and enforced in accordance with the laws of the State of Maryland, without giving effect to the principles of conflicts of law of such state.

(h) Binding Arbitration. Any disputes regarding this Agreement, any award or vesting of Common Shares and/or any related matters shall be settled by binding arbitration in accordance with any Mutual Agreement to Resolve Disputes and Arbitrate Claims between the Recipient and the Manager. In the absence of such an agreement, any such claims or disputes shall be resolved through binding arbitration before one arbitrator conducted under the rules of JAMS in Boston, Massachusetts.

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement, or caused this Agreement to be executed under seal, as of the date first above written.


						Industrial Logistics Properties Trust


			By:
			Name:
			Title

			RECIPIENT:


						«NAME»
						«ADDRESS»
						«CITY», «ST» «ZIP»

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Exhibit A

A “Change in Control” shall be deemed to have occurred if any of the events set forth in any one of the following paragraphs shall have occurred:

(a) any Person is or becomes the Beneficial Owner, directly or indirectly, of securities of the Company representing 50% or more of either the then outstanding common shares of beneficial interest of the Company or the combined voting power of the Company’s then outstanding securities, excluding any Person who becomes such a Beneficial Owner in connection with a transaction described in paragraph (c)(i) below;

(b) the following individuals cease for any reason to constitute a majority of the number of Trustees then serving: individuals who, on the date of the Agreement, constitute the Board and any new Trustee (other than a Trustee whose initial assumption of office is in connection with an actual or threatened election contest, including but not limited to a consent solicitation, relating to the election of Trustees) whose appointment or election by the Board or nomination for election by the Company’s shareholders was approved or recommended by a vote of at least two-thirds (2/3) of the Trustees then in office who either were Trustees on the date of the Agreement or whose appointment, election or nomination for election was previously so approved or recommended;

(c) there is consummated a merger or consolidation of the Company or any direct or indirect subsidiary of the Company with any other entity, other than (i) a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior to such merger or consolidation continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or any parent thereof) at least 50% of the combined voting power of the securities of the Company or such surviving entity or any parent thereof outstanding immediately after such merger or consolidation, or (ii) a merger or consolidation effected to implement a recapitalization of the Company (or similar transaction) in which no Person is or becomes the Beneficial Owner, directly or indirectly, of securities of the Company (not including in the securities Beneficially Owned by such Person any securities acquired directly from the Company or its Affiliates) representing 50% or more of the combined voting power of the Company’s then outstanding securities; or

(d) the shareholders of the Company approve a plan of complete liquidation or dissolution of the Company or there is consummated an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets, other than a sale or disposition by the Company of all or substantially all of the Company’s assets to an entity, at least 50% of the combined voting power of the voting securities of which are owned by shareholders of the Company in substantially the same proportions as their ownership of the Company immediately prior to such sale.

Notwithstanding anything to the contrary set forth herein, a transaction involving the Company and an Excluded Entity (or Affiliate) in which the award of Shares is to be assumed by the successor (or replaced by a substantially equivalent award) shall not constitute a Change in Control.

A “Termination Event” shall occur if The RMR Group LLC (or any entity controlled by, under common control with or controlling The RMR Group LLC) ceases to be the manager or shared services provider to the Company.

For purposes of the definitions set forth on this Exhibit A, the following definitions shall apply, with capitalized terms used but not defined in this Exhibit A having the meaning set forth in the Plan:

“Affiliate” shall have the meaning set forth in Rule 12b-2 promulgated under Section 12 of the Exchange Act.

“Agreement” shall mean the Share Award Agreement to which this Exhibit A is attached.

“Beneficial Owner” shall have the meaning set forth in Rule 13d-3 under the Exchange Act.

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.

“Excluded Entity” shall mean any entity to which The RMR Group LLC (or any entity controlled by, under common control with or controlling The RMR Group LLC) provides management, advisory or shared services.

“Person” shall have the meaning given in Section 3(a)(9) of the Exchange Act, as modified and used in Sections 13(d) and 14(d) thereof, except that such term shall not include (i) the Company or any of its subsidiaries, (ii) a trustee or other fiduciary holding securities under an employee benefit plan of the Company or any of its Affiliates, (iii) an underwriter temporarily holding securities pursuant to an offering of such securities and (iv) a corporation owned, directly or indirectly, by the shareholders of the Company in substantially the same proportions as their ownership of shares of the Company.

“Trustee” is a member of the Board of Trustees of the Company.

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Exhibit 10.2

INDUSTRIAL LOGISTICS PROPERTIES TRUST
FORM OF INDEMNIFICATION AGREEMENT

THIS INDEMNIFICATION AGREEMENT (this “Agreement”), effective as of [DATE] (the “Effective Date”), by and between Industrial Logistics Properties Trust, a Maryland real estate investment trust (the “Company”), and [TRUSTEE/OFFICER] (“Indemnitee”).

WHEREAS, Indemnitee currently serves as a trustee and/or executive officer of the Company and may, in connection therewith, be subjected to claims, suits or proceedings arising from such service; and

WHEREAS, as an inducement to Indemnitee to serve as [a/the] [title(s)] of the Company, the Company has agreed to indemnify and to advance expenses and costs incurred by Indemnitee in connection with any such claims, suits or proceedings, to the maximum extent permitted by law as hereinafter provided; and

WHEREAS, the parties by this Agreement desire to set forth their agreement regarding indemnification and advance of expenses;

NOW, THEREFORE, in consideration of the premises and the covenants contained herein, the Company and Indemnitee do hereby covenant and agree as follows:

Section 1.Definitions. For purposes of this Agreement:

(a)“Board” means the board of trustees of the Company.

(b)“Bylaws” means the bylaws of the Company, as they may be amended from time to time.

(c)“Change in Control” means a change in control of the Company occurring after the Effective Date of a nature that would be required to be reported in response to Item 6(e) of Schedule 14A of Regulation 14A (or in response to any similar item on any similar schedule or form) promulgated under the Securities Exchange Act of 1934, as amended (the “Act”), whether or not the Company is then subject to such reporting requirement; provided, however, that, without limitation, such a Change in Control shall be deemed to have occurred if after the Effective Date:

(i) any “person” (as such term is used in Sections 13(d) and 14(d) of the Act) is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Act), directly or indirectly, of securities of the Company representing 10% or more of the combined voting power of all the Company’s then-outstanding securities entitled to vote generally in the election of trustees without the prior approval of at least two-thirds of the members of the Board in office immediately prior to such person attaining such percentage interest;

(ii) there occurs a proxy contest, or the Company is a party to a merger, consolidation, sale of assets, plan of liquidation or other reorganization not approved by at least two-thirds of the members of the Board then in office, as a consequence of which members of the Board in office immediately prior to such transaction or event constitute less than a majority of the Board thereafter; or

(iii) during any period of two consecutive years, other than as a result of an event described in clause (a)(ii) of this Section 1, individuals who at the beginning of such period constituted the Board (including for this purpose any new trustee whose election or nomination for election by the Company’s shareholders was approved by a vote of at least two-thirds of the trustees then still in office who were trustees at the beginning of such period) cease for any reason to constitute at least a majority of the Board.

(d)“Company Status” means the status of a Person who is or was a trustee, director, officer, employee, agent or fiduciary of the Company or any of its majority owned subsidiaries and the status of a Person who, while a trustee, director, officer, employee, agent or fiduciary of the Company or any of its majority owned subsidiaries, is or was serving at the request of the Company as a director, trustee, officer, partner, manager or fiduciary of another corporation, real estate investment trust, partnership, limited liability company, joint venture, trust, employee benefit plan or any other Enterprise.

(e)“Control” of an entity, shall mean the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of such entity, whether through ownership of voting securities, by contract or otherwise.

(f)“Declaration of Trust” means the declaration of trust (as defined in the Maryland REIT Law) of the Company, as it may be in effect from time to time.

(g)“Disinterested Trustee” means a trustee of the Company who is not and was not a party to the Proceeding in respect of which indemnification or advance of Expenses is sought by Indemnitee.

(h) “Enterprise” shall mean the Company and any other corporation, real estate investment trust, partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise that Indemnitee is or was serving at the express written request of the Company as a director, trustee, officer, partner, manager or fiduciary.

(i)“Expenses” means all expenses, including, but not limited to, all attorneys’ fees and costs, retainers, court or arbitration costs, transcript costs, fees of experts, witness fees, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees, and all other disbursements or expenses of the types customarily incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating, participating, or being or preparing to be a witness in a Proceeding, or responding to, or objecting to, a request to provide discovery in any Proceeding. Expenses also shall include Expenses incurred in connection with any appeal resulting from any Proceeding, including without limitation the premium, security for, and other costs relating to any cost bond or other appeal bond or its equivalent.

(j)“Independent Counsel” means a law firm, or a member of a law firm, selected by the Company and acceptable to the Indemnitee, that is experienced in matters of business law. If, within twenty (20) days after submission by Indemnitee of a written demand for indemnification pursuant to Section 7(a) hereof, no Independent Counsel shall have been selected and agreed to by Indemnitee, either the Company or Indemnitee may petition a Chosen Court for the appointment as Independent Counsel of a person selected by the court or by such other person as the court shall designate, and the person so appointed shall act as Independent Counsel hereunder.

(k)“MGCL” means the Maryland General Corporation Law.

(l)“Maryland REIT Law” means Title 8 of the Corporations and Associations Article of the Annotated Code of Maryland.

(m)“Person” means an individual, a corporation, a general or limited partnership, an association, a limited liability company, a governmental entity, a trust, a joint venture, a joint stock company or another entity or organization.

(n)“Proceeding” means any threatened, pending or completed claim, demand, action, suit, arbitration, alternate dispute resolution mechanism, investigation, inquiry, administrative hearing or any other proceeding, whether civil, criminal, administrative or investigative (including on appeal), whether or not by or in the right of the Company, except one initiated by an Indemnitee pursuant to Section 9.

Section 2.Indemnification - General. The Company shall indemnify, and advance Expenses to, Indemnitee (a) as provided in this Agreement and (b) otherwise to the maximum extent permitted by Maryland law in effect on the Effective Date and as amended from time to time; provided, however, that no change in Maryland law shall have the effect of reducing the benefits available to Indemnitee hereunder based on Maryland law as in effect on the Effective Date. The rights of Indemnitee provided in this Section 2 shall include, without limitation, the rights set forth in the other sections of this Agreement, including any additional indemnification permitted by Section 2-418(g) of the MGCL, as applicable to a Maryland real estate investment trust by virtue of Section 8-301(15) of the Maryland REIT Law.

Section 3.Proceedings Other Than Derivative Proceedings by or in the Right of the Company. Indemnitee shall be entitled to the rights of indemnification provided in this Section 3 if, by reason of Indemnitee’s Company Status, Indemnitee is, or is threatened to be, made a party to any Proceeding, other than a derivative Proceeding by or in the right of the Company (or, if applicable, such other Enterprise at which Indemnitee is or was serving at the request of the Company). Pursuant to this Section 3, Indemnitee shall be indemnified against all judgments, penalties, fines and amounts paid in settlement and all Expenses incurred by Indemnitee or on Indemnitee’s behalf in connection with a Proceeding by reason of Indemnitee’s Company Status unless it is finally determined that such indemnification is not permitted by the MGCL.

Section 4.Derivative Proceedings by or in the Right of the Company. Indemnitee shall be entitled to the rights of indemnification provided in this Section 4 if, by reason of Indemnitee’s Company Status, Indemnitee is, or is threatened to be, made a party to any derivative Proceeding brought by or in the right of the Company (or, if

applicable, such other Enterprise at which Indemnitee is or was serving at the request of the Company). Pursuant to this Section 4, Indemnitee shall be indemnified against all judgments, penalties, fines and amounts paid in settlement and all Expenses incurred by Indemnitee or on Indemnitee’s behalf in connection with such Proceeding unless it is finally determined that such indemnification is not permitted by the MGCL.

Section 5.Indemnification for Expenses of a Party Who is Partly Successful. Without limitation on Section 3 or Section 4, if Indemnitee is not wholly successful in any Proceeding covered by this Agreement, but is successful, on the merits or otherwise, as to one or more but less than all claims, issues or matters in such Proceeding, the Company shall indemnify Indemnitee under this Section 5 for all Expenses incurred by Indemnitee or on Indemnitee’s behalf in connection with each successfully resolved claim, issue or matter, allocated on a reasonable and proportionate basis. For purposes of this Section 5 and without limitation, the termination of any claim, issue or matter in such a Proceeding by dismissal, with or without prejudice, shall be deemed to be a successful result as to such claim, issue or matter.

Section 6.Advance of Expenses. The Company, without requiring a preliminary determination of Indemnitee’s ultimate entitlement to indemnification hereunder, shall advance all Expenses incurred by or on behalf of Indemnitee in connection with any Proceeding in which Indemnitee may be involved, or is threatened to be involved, including as a party, a witness or otherwise, by reason of Indemnitee’s Company Status, within ten (10) days after the receipt by the Company of a statement or statements from Indemnitee requesting such advance or advances from time to time, whether prior to or after final disposition of such Proceeding. Such statement or statements shall reasonably evidence the Expenses incurred by Indemnitee and shall be preceded or accompanied by a written affirmation by Indemnitee of Indemnitee’s good faith belief that the standard of conduct necessary for indemnification by the Company as authorized by the MGCL has been met and a written undertaking by or on behalf of Indemnitee, in substantially the form of Exhibit A hereto or in such other form as may be required under applicable law as in effect at the time of the execution thereof, to reimburse the portion of any Expenses advanced to Indemnitee relating to claims, issues or matters in the Proceeding as to which it shall be finally determined that the standard of conduct has not been met and which have not been successfully resolved as described in Section 5. For the avoidance of doubt, the Company shall advance Expenses incurred by Indemnitee or on Indemnitee’s behalf in connection with such a Proceeding pursuant to this Section 6 until it is finally determined that the Indemnitee is not entitled to indemnification under law in respect of such Proceeding. To the extent that Expenses advanced to Indemnitee do not relate to a specific claim, issue or matter in the Proceeding, such Expenses shall be allocated on a reasonable and proportionate basis. The undertaking required by this Section 6 shall be an unlimited general obligation by or on behalf of Indemnitee and shall be accepted without reference to Indemnitee’s financial ability to repay such advanced Expenses and without any requirement to post security therefor. At Indemnitee’s request, advancement of any such Expense shall be made by the Company’s direct payment of such Expense instead of reimbursement of Indemnitee’s payment of such Expense.

Section 7.Procedure for Determination of Entitlement to Indemnification.

(a)To obtain indemnification under this Agreement, Indemnitee shall submit to the Company a written demand therefor. The Secretary of the Company shall, promptly upon receipt of such a demand for indemnification, provide copies of the demand to the Board.

(b)Upon written request by Indemnitee for indemnification pursuant to the first sentence of Section 7(a), a determination, if required by applicable law, with respect to Indemnitee’s entitlement thereto shall promptly be made in the specific case: (i) if a Change in Control shall have occurred, by Independent Counsel in a written opinion to the Board, a copy of which shall be delivered to Indemnitee; or (ii) if a Change in Control shall not have occurred or if, after a Change in Control, Indemnitee shall so request, (A) by the Board (or a duly authorized committee thereof) by a majority vote of a quorum consisting of Disinterested Trustees, or (B) if a quorum of the Board consisting of Disinterested Trustees is not obtainable or, even if obtainable, such quorum of Disinterested Trustees so directs, by Independent Counsel in a written opinion to the Board, a copy of which shall be delivered to Indemnitee, or (C) if so directed by a majority of the members of the Board, by the shareholders of the Company; and, if it is so determined that Indemnitee is entitled to indemnification, payment to Indemnitee shall be made within ten (10) days after such determination. Any Independent Counsel, member of the Board or shareholder of the Company shall act reasonably and in good faith in making a determination regarding the Indemnitee’s entitlement to indemnification under this Agreement.

(c)The Company shall pay the fees and expenses of Independent Counsel, if one is appointed, and shall agree to fully indemnify such Independent Counsel against any and all expenses, claims, liabilities and damages arising out of or relating to this Agreement or the Independent Counsel’s engagement as such pursuant hereto.

Section 8.Presumptions and Effect of Certain Proceedings.

(a)In making a determination with respect to entitlement to indemnification hereunder, the Person or Persons making such determination shall presume that Indemnitee is entitled to indemnification under this Agreement. Anyone seeking to overcome this presumption shall have the burden of proof and the burden of persuasion by clear and convincing evidence.

(b)It shall be presumed that Indemnitee has at all times acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Company. Anyone seeking to overcome this presumption shall have the burden of proof and the burden of persuasion by clear and convincing evidence. Without limitation of the foregoing, Indemnitee shall be deemed to have acted in good faith if Indemnitee’s action is based on the records or books of account of the Enterprise, including financial statements, or on information supplied to Indemnitee by officers of the Enterprise in the course of their duties, or on the advice of legal counsel for the Enterprise or on information or records given or reports made to the Enterprise by an independent certified public accountant or by an appraiser or other expert selected with reasonable care by the Enterprise. In addition, the knowledge or actions, or failure to act, of any trustee, director, officer, agent or employee of the Enterprise shall not be imputed to Indemnitee for purposes of determining the right to indemnification under this Agreement.

(c)Neither the failure to make a determination pursuant to Section 7(b) as to whether indemnification is proper in the circumstances because Indemnitee has met any particular standard of conduct, nor an actual determination by the Company (including by its trustees or Independent Counsel) pursuant to Section 7(b) that Indemnitee has not met such standard of conduct, shall be a defense to Indemnitee’s claim that indemnification is proper in the circumstances or create a presumption that Indemnitee has not met any particular standard of conduct.

(d)The termination of any Proceeding by judgment, order, settlement, conviction, a plea of nolo contendere or its equivalent, or an entry of an order of probation prior to judgment, shall not in and of itself adversely affect the right of Indemnitee to indemnification or create a presumption that Indemnitee did not meet the standard of conduct required for indemnification. The Company acknowledges that a settlement or other disposition short of final judgment may be successful if it permits a party to avoid expense, delay, distraction, disruption and uncertainty. In the event that any Proceeding to which Indemnitee is a party is resolved in any manner other than by adverse judgment against Indemnitee (including, without limitation, settlement of such action, claim or proceeding with or without payment of money or other consideration), it shall be presumed that Indemnitee has been successful on the merits or otherwise in such Proceeding. Anyone seeking to overcome this presumption shall have the burden of proof and the burden of persuasion by clear and convincing evidence.

Section 9.Remedies of Indemnitee.

(a)If (i) a determination is made pursuant to Section 7(b) that Indemnitee is not entitled to indemnification under this Agreement, (ii) advance of Expenses is not timely made pursuant to Section 6, (iii) no determination of entitlement to indemnification shall have been made pursuant to Section 7(b) within thirty (30) days after receipt by the Company of the request for indemnification, (iv) payment of indemnification is not made pursuant to Section 5 within ten (10) days after receipt by the Company of a written request therefor, or (v) payment of indemnification is not made within ten (10) days after a determination has been made that Indemnitee is entitled to indemnification, Indemnitee shall (A) unless the Company demands arbitration as provided by Section 17, be entitled to an adjudication in a Chosen Court or (B) be entitled to seek an award in arbitration as provided by Section 17, in each case of Indemnitee’s entitlement to such indemnification or advance of Expenses.

(b)In any judicial proceeding or arbitration commenced pursuant to this Section 9, the Company shall have the burden of proving that Indemnitee is not entitled to indemnification or advance of Expenses, as the case may be. In the event that a determination shall have been made pursuant to Section 7(b) that Indemnitee is not entitled to indemnification, any judicial proceeding or arbitration commenced pursuant to this Section 9 shall be conducted in all respects as a de novo trial on the merits, and the Indemnitee shall not be prejudiced by reason of the adverse determination under Section 7(b).

(c)If a determination shall have been made pursuant to Section 7(b) that Indemnitee is entitled to indemnification, the Company shall be bound by such determination in any judicial proceeding or arbitration commenced pursuant to this Section 9, absent a misstatement by Indemnitee of a material fact, or an omission of a material fact necessary to make Indemnitee’s statement not materially misleading, in connection with the demand for indemnification.

(d)In the event that Indemnitee, pursuant to this Section 9, seeks a judicial adjudication of or an award in arbitration as provided by Section 17 to enforce Indemnitee’s rights under, or to recover damages for breach of, this Agreement by the Company, or to recover under any directors’ and officers’ liability insurance policies maintained by the Company, the Company shall indemnify Indemnitee against any and all Expenses

incurred by Indemnitee in such judicial adjudication or arbitration and, if requested by Indemnitee, the Company shall (within ten (10) days after receipt by the Company of a written demand therefore) advance, to the extent not prohibited by law, any and all such Expenses.

(e)The Company shall be precluded from asserting in any judicial proceeding or arbitration commenced pursuant to this Section 9 that the procedures and presumptions of this Agreement are not valid, binding and enforceable and shall stipulate in any such judicial proceeding or arbitration that the Company is bound by all the provisions of this Agreement.

(f)To the extent requested by Indemnitee and approved by the Board, the Company may at any time and from time to time provide security to Indemnitee for the Company’s obligations hereunder through an irrevocable bank line of credit, funded trust or other collateral. Any such security, once provided to Indemnitee, may not be revoked or released without the prior written consent of the Indemnitee.

(g)Interest shall be paid by the Company to Indemnitee at the maximum rate allowed to be charged for judgments under the Courts and Judicial Proceedings Article of the Annotated Code of Maryland for amounts which the Company pays or is obligated to pay for the period (i) commencing with either the tenth (10th) day after the date on which the Company was requested to advance Expenses in accordance with Section 6 of this Agreement or the thirtieth (30th) day after the date on which the Company was requested to make the determination of entitlement to indemnification under Section 7(b) of this Agreement, as applicable, and (ii) ending on the date such payment is made to Indemnitee by the Company.

Section 10.Defense of the Underlying Proceeding.

(a)Indemnitee shall notify the Company promptly upon being served with or receiving any summons, citation, subpoena, complaint, indictment, information, notice, request or other document relating to any Proceeding which may result in the right to indemnification or the advance of Expenses hereunder; provided, however, that the failure to give any such notice shall not disqualify Indemnitee from the right, or otherwise affect in any manner any right of Indemnitee, to indemnification or the advance of Expenses under this Agreement unless the Company’s ability to defend in such Proceeding or to obtain proceeds under any insurance policy is materially and adversely prejudiced thereby, and then only to the extent the Company is thereby actually so prejudiced.

(b)Subject to the provisions of the last sentence of this Section 10(b) and of Section 10(c) below, the Company shall have the right to defend Indemnitee in any Proceeding which may give rise to indemnification hereunder; provided, however, that the Company shall notify Indemnitee of any such decision to defend within fifteen (15) days following receipt of notice of any such Proceeding under Section 10(a) above, and the counsel selected by the Company shall be reasonably satisfactory to Indemnitee. The Company shall not, without the prior written consent of Indemnitee, consent to the entry of any judgment against Indemnitee or enter into any settlement or compromise which (i) includes an admission of fault of Indemnitee, (ii) does not include, as an unconditional term thereof, the full release of Indemnitee from all liability in respect of such Proceeding, which release shall be in form and substance reasonably satisfactory to Indemnitee or (iii) has the actual or purported effect of extinguishing, limiting or impairing Indemnitee’s rights hereunder. This Section 10(b) shall not apply to a Proceeding brought by Indemnitee under Section 9 above or Section 15.

(c)Notwithstanding the provisions of Section 10(b), if in a Proceeding to which Indemnitee is a party by reason of Indemnitee’s Company Status, (i) Indemnitee reasonably concludes, based upon an opinion of counsel approved by the Company, which approval shall not be unreasonably withheld, that Indemnitee may have separate defenses or counterclaims to assert with respect to any issue which may not be consistent with other defendants in such Proceeding, (ii) Indemnitee reasonably concludes, based upon an opinion of counsel approved by the Company, which approval shall not be unreasonably withheld, that an actual or apparent conflict of interest or potential conflict of interest exists between Indemnitee and the Company, or (iii) the Company fails to assume the defense of such Proceeding in a timely manner, Indemnitee shall be entitled to be represented by separate legal counsel of Indemnitee’s choice, subject to the prior approval of the Company, which shall not be unreasonably withheld, at the expense of the Company. In addition, if the Company fails to comply with any of its obligations under this Agreement or in the event that the Company or any other Person takes any action to declare this Agreement void or unenforceable, or institutes any Proceeding to deny or to recover from Indemnitee the benefits intended to be provided to Indemnitee hereunder, Indemnitee shall have the right to retain counsel of Indemnitee’s choice, at the expense of the Company (subject to Section 9(d)), to represent Indemnitee in connection with any such matter.

Section 11.Liability Insurance.

(a)To the extent the Company maintains an insurance policy or policies providing liability insurance for any of its trustees or officers, Indemnitee shall be covered by such policy or policies, in accordance with its or their terms, to the maximum extent of the coverage available for any Company trustee or officer during the Indemnitee’s tenure as a trustee or officer and, following a termination of Indemnitee’s service in connection with a Change in Control, for a period of six (6) years thereafter.

(b)If, at the time of the receipt of a notice of a claim pursuant to the terms hereof, the Company has directors’ and officers’ liability insurance in effect, the Company shall give prompt notice of the commencement of such proceeding to the insurers in accordance with the procedures set forth in the respective policies. The Company shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of the Indemnitee, all amounts payable as a result of such proceeding in accordance with the terms of such policies.

(c)In the event of any payment by the Company under this Agreement the Company shall be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee with respect to any insurance policy. Indemnitee shall take all action necessary to secure such rights, including execution of such documents as are necessary to enable the Company to bring suit to enforce such rights in accordance with the terms of such insurance policy. The Company shall pay or reimburse all expenses actually and reasonably incurred by Indemnitee in connection with such subrogation.

Section 12.Non-Exclusivity; Survival of Rights.

(a)The rights of indemnification and advance of Expenses as provided by this Agreement shall not be deemed exclusive of any other rights to which Indemnitee may at any time be entitled under applicable law, the Declaration of Trust or the Bylaws, any agreement or a resolution of the shareholders entitled to vote generally in the election of trustees or of the Board, or otherwise. No amendment, alteration or repeal of this Agreement or of any provision hereof shall limit or restrict any right of Indemnitee under this Agreement in respect of any action taken or omitted by such Indemnitee in Indemnitee’s Company Status prior to such amendment, alteration or repeal. To the extent that a change in the Maryland REIT Law or the MGCL permits greater indemnification than would be afforded currently under the Declaration of Trust, Bylaws and this Agreement, it is the intent of the parties hereto that Indemnitee shall enjoy by this Agreement the greater benefits so afforded by such change. No right or remedy herein conferred is intended to be exclusive of any other right or remedy, and every other right and remedy shall be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other right or remedy.

(b)The Company shall not be liable under this Agreement to make any payment of amounts otherwise indemnifiable or payable or reimbursable as Expenses hereunder if and to the extent that Indemnitee has otherwise actually received such payment under any insurance policy, contract, agreement or otherwise.

Section 13.Binding Effect.

(a)The indemnification and advance of Expenses provided by, or granted pursuant to, this Agreement shall be binding upon and be enforceable by the parties hereto and their respective successors and assigns (including any direct or indirect successor by purchase, merger, consolidation or otherwise to all or substantially all of the business or assets of the Company), shall continue as to an Indemnitee who has ceased to be a trustee or executive officer of the Company or a director, officer, partner, member, manager or trustee of another Enterprise which such Person is or was serving at the request of the Company, and shall inure to the benefit of Indemnitee and Indemnitee’s spouse, assigns, heirs, devisees, executors and administrators and other legal representatives.

(b)Any successor of the Company (whether direct or indirect by purchase, merger, consolidation or otherwise) to all, substantially all or a substantial part, of the business or assets of the Company shall be automatically deemed to have assumed and agreed to perform this Agreement in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place, provided that no such assumption shall relieve the Company of its obligations hereunder. To the extent required by applicable law to give effect to the foregoing sentence and to the extent requested by Indemnitee, the Company shall require and cause any such successor to expressly assume and agree to perform this Agreement by written agreement in form and substance satisfactory to Indemnitee.

Section 14.Severability. If any provision or provisions of this Agreement shall be held to be invalid, illegal or unenforceable for any reason whatsoever: (a) the validity, legality and enforceability of the remaining provisions of this Agreement (including, without limitation, each portion of any section of this Agreement containing any such provision held to be invalid, illegal or unenforceable that is not itself invalid, illegal or

unenforceable) shall not in any way be affected or impaired thereby; and (b) to the fullest extent possible, the provisions of this Agreement (including, without limitation, each portion of any section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested thereby.

Section 15.Limitation and Exception to Right of Indemnification or Advance of Expenses. Notwithstanding any other provision of this Agreement, (a) any indemnification or advance of Expenses to which Indemnitee is otherwise entitled under the terms of this Agreement shall be made only to the extent such indemnification or advance of Expenses does not conflict with applicable Maryland law and (b) Indemnitee shall not be entitled to indemnification or advance of Expenses under this Agreement with respect to any Proceeding brought by Indemnitee, unless (i) the Proceeding is brought to enforce rights under this Agreement, the Declaration of Trust, the Bylaws, liability insurance policy or policies, if any, or otherwise or (ii) the Declaration of Trust, the Bylaws, a resolution of the shareholders entitled to vote generally in the election of trustees or of the Board or an agreement approved by the Board to which the Company is a party expressly provides otherwise. Notwithstanding any other provision of this Agreement, a court of appropriate jurisdiction, upon application of Indemnitee and such notice as the court shall require, may order indemnification of Indemnitee by the Company in the following circumstances: (a) if such court determines that Indemnitee is entitled to reimbursement under Section 2-418(d)(1) of the MGCL, the court shall order indemnification, in which case Indemnitee shall be entitled to recover the Expenses of securing such reimbursement; or (b) if such court determines that Indemnitee is fairly and reasonably entitled to indemnification in view of all the relevant circumstances, whether or not Indemnitee (i) has met the standard of conduct set forth in Section 2-418(b) of the MGCL or (ii) has been adjudged liable for receipt of an improper personal benefit under Section 2-418(c) of the MGCL, the court may order such indemnification as the court shall deem proper without regard to any limitation on such court-ordered indemnification contemplated by Section 2-418(d)(2)(ii) of the MGCL.

Section 16.Specific Performance, Etc. The parties hereto recognize that if any provision of this Agreement is violated by the Company, Indemnitee may be without an adequate remedy at law. Accordingly, in the event of any such violation, Indemnitee shall be entitled, if Indemnitee so elects, to institute proceedings, either in law or at equity, to obtain damages, to enforce specific performance, to enjoin such violation, or to obtain any relief or any combination of the foregoing as Indemnitee may elect to pursue.

Section 17.Arbitration.

(a)Any disputes, claims or controversies regarding the Indemnitee’s entitlement to indemnification or advancement of Expenses hereunder or otherwise arising out of or relating to this Agreement, including any disputes, claims or controversies brought by or on behalf of a party hereto or any holder of equity interests (which, for purposes of this Section 17, shall mean any holder of record or any beneficial owner of equity interests or any former holder of record or beneficial owner of equity interests) of a party, either on his, her or its own behalf, on behalf of a party or on behalf of any series or class of equity interests of a party or holders of equity interests of a party against a party or any of their respective trustees, directors, members, officers, managers, agents or employees, including any disputes, claims or controversies relating to the meaning, interpretation, effect, validity, performance or enforcement of this Agreement, including this arbitration agreement or the governing documents of a party, (all of which are referred to as “Disputes”) or relating in any way to such a Dispute or Disputes shall, on the demand of any party to such Dispute or Disputes, be resolved through binding and final arbitration in accordance with the Commercial Arbitration Rules (the “Rules”) of the American Arbitration Association (“AAA”) then in effect, except as those Rules may be modified in this Section 17. For the avoidance of doubt, and not as a limitation, Disputes are intended to include derivative actions against the trustees, directors, officers or managers of a party and class actions by a holder of equity interests against those individuals or entities and a party. For the avoidance of doubt, a Dispute shall include a Dispute made derivatively on behalf of one party against another party. For purposes of this Section 17, the term “equity interest” shall mean, in respect of (i) the Company, shares of beneficial interest of the Company, (ii) shares of “membership interests” in an entity that is a limited liability company, (iii) general partnership interests in an entity that is a partnership, (iv) shares of capital stock of an entity that is a corporation and (v) similar equity ownership interests in other entities.

(b)There shall be three (3) arbitrators. If there are only two (2) parties to the Dispute, each party shall select one (1) arbitrator within fifteen (15) days after receipt by respondent of a copy of the demand for arbitration. The arbitrators may be affiliated or interested persons of the parties. If there are more than two (2) parties to the Dispute, all claimants, on the one hand, and all respondents, on the other hand, shall each select, by the vote of a majority of the claimants or the respondents, as the case may be, one (1) arbitrator within fifteen (15) days after receipt of the demand for arbitration. The arbitrators may be affiliated or interested persons of the claimants or the respondents, as the case may be. If either a claimant (or all claimants) or a respondent (or all respondents) fail(s) to timely select an arbitrator then the party (or parties) who has selected an arbitrator may request AAA to provide a list of three (3) proposed arbitrators in accordance with the Rules (each of whom shall be neutral, impartial and

unaffiliated with any party) and the party (or parties) that failed to timely appoint an arbitrator shall have ten (10) days from the date AAA provides the list to select one (1) of the three (3) arbitrators proposed by AAA. If the party (or parties) fail(s) to select the second (2nd) arbitrator by that time, the party (or parties) who have appointed the first (1st) arbitrator shall then have ten (10) days to select one (1) of the three (3) arbitrators proposed by AAA to be the second (2nd) arbitrator; and, if he/they should fail to select the second (2nd) arbitrator by such time, AAA shall select, within fifteen (15) days thereafter, one (1) of the three (3) arbitrators it had proposed as the second (2nd) arbitrator. The two (2) arbitrators so appointed shall jointly appoint the third (3rd) and presiding arbitrator (who shall be neutral, impartial and unaffiliated with any party) within fifteen (15) days of the appointment of the second (2nd) arbitrator. If the third (3rd) arbitrator has not been appointed within the time limit specified herein, then AAA shall provide a list of proposed arbitrators in accordance with the Rules, and the arbitrator shall be appointed by AAA in accordance with a listing, striking and ranking procedure, with each party having a limited number of strikes, excluding strikes for cause.

(c)The place of arbitration shall be Boston, Massachusetts unless otherwise agreed by the parties.

(d)There shall be only limited documentary discovery of documents directly related to the issues in dispute, as may be ordered by the arbitrators. For the avoidance of doubt, it is intended that there shall be no depositions and no other discovery other than limited documentary discovery as described in the preceding sentence.

(e)In rendering an award or decision (an “Award”), the arbitrators shall be required to follow the laws of the State of Maryland without regard to principles of conflicts of law. Any arbitration proceedings or award rendered hereunder and the validity, effect and interpretation of this arbitration agreement shall be governed by the Federal Arbitration Act, 9 U.S.C. §1 et seq. An Award shall be in writing and shall state the findings of fact and conclusions of law on which it is based. Any monetary Award shall be made and payable in U.S. dollars free of any tax, deduction or offset. Subject to Section 17(g), each party against which an Award assesses a monetary obligation shall pay that obligation on or before the thirtieth (30th) day following the date of such Award or such other date as the Award may provide.

(f)Except to the extent expressly provided by this Agreement or as otherwise agreed by the parties thereto, each party and each Person acting or seeking to act in a representative capacity (such Person, a “Named Representative”) involved in a Dispute shall bear its own costs and expenses (including attorneys’ fees), and the arbitrators shall not render an Award that would include shifting of any such costs or expenses (including attorneys’ fees) or, in a derivative case or class action, award any portion of a party’s award to its attorneys, a Named Representative or any attorney of a Named Representative. Each party (or, if there are more than two (2) parties to the Dispute, all claimants, on the one hand, and all respondents, on the other hand, respectively) shall bear the costs and expenses of its (or their) selected arbitrator and the parties (or, if there are more than two (2) parties to the Dispute, all claimants, on the one hand, and all respondents, on the other hand) shall equally bear the costs and expenses of the third (3rd) appointed arbitrator.

(g)Notwithstanding any language to the contrary in this Agreement, an Award, including but not limited to any interim Award, may be appealed pursuant to the AAA’s Optional Appellate Arbitration Rules (the “Appellate Rules”). An Award shall not be considered final until after the time for filing the notice of appeal pursuant to the Appellate Rules has expired. Appeals must be initiated within thirty (30) days of receipt of an Award by filing a notice of appeal with any AAA office. Following the appeal process, the decision rendered by the appeal tribunal may be entered in any court having jurisdiction thereof. For the avoidance of doubt, and despite any contrary provision of the Appellate Rules, Section 17(f) shall apply to any appeal pursuant to this Section 17 and the appeal tribunal shall not render an Award that would include shifting of any costs or expenses (including attorneys’ fees) of any party or Named Representative or the payment of such costs and expenses, and all costs and expenses of a party or Named Representative shall be its sole responsibility.

(h)Following the expiration of the time for filing the notice of appeal, or the conclusion of the appeal process set forth in Section 17(g), an Award shall be final and binding upon the parties thereto and shall be the sole and exclusive remedy between those parties relating to the Dispute, including any claims, counterclaims, issues or accounting presented to the arbitrators. Judgment upon an Award may be entered in any court having jurisdiction. To the fullest extent permitted by law, no application or appeal to any court of competent jurisdiction may be made in connection with any question of law arising in the course of arbitration or with respect to any award made except for actions relating to enforcement of this agreement to arbitrate or any arbitral award issued hereunder and except for actions seeking interim or other provisional relief in aid of arbitration proceedings in any court of competent jurisdiction.

(i)This Section 17 is intended to benefit and be enforceable by the parties hereto and their respective holders of equity interests, trustees, directors, officers, managers, agents or employees, and their respective successors and assigns, and shall be binding upon all such parties and their respective holders of equity interests, and be in addition to, and not in substitution for, any other rights to indemnification or contribution that such individuals or entities may have by contract or otherwise.

Section 18.Venue. Each party hereto agrees that it shall bring any Proceeding in respect of any claim arising out of or related to this Agreement exclusively in the courts of the State of Maryland and the Federal courts of the United States, in each case, located in the City of Baltimore (the “Chosen Courts”). Solely in connection with claims arising under this Agreement, each party irrevocably and unconditionally (i) submits to the exclusive jurisdiction of the Chosen Courts, (ii) agrees not to commence any such Proceeding except in such courts, (iii) waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any such Proceeding in the Chosen Courts, (iv) waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such Proceeding, (v) agrees that service of process upon such party in any such Proceeding shall be effective if notice is given in accordance with Section 24 and (vi) agrees to request and/or consent to the assignment of any dispute arising out of this Agreement or the transactions contemplated by this Agreement to the Chosen Courts’ Business and Technology Case Management Program, or similar program. Nothing in this Agreement will affect the right of any party hereto to serve process in any other manner permitted by law. A final judgment in any such Proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. EACH PARTY HERETO IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS. Notwithstanding anything herein to the contrary, if a demand for arbitration of a Dispute is made pursuant to Section 17, this Section 18 shall not preempt resolution of the Dispute pursuant to Section 17.

Section 19.Adverse Settlement. The Company shall not seek, nor shall it agree to or support, or agree not to contest any settlement or other resolution of any matter that has the actual or purported effect of extinguishing, limiting or impairing Indemnitee’s rights hereunder, including without limitation the entry of any bar order or other order, decree or stipulation, pursuant to 15 U.S.C. § 78u-4 (the Private Securities Litigation Reform Act), or any similar foreign, federal or state statute, regulation, rule or law.

Section 20.Period of Limitations. To the fullest extent permitted by law, no legal action shall be brought, and no cause of action shall be asserted, by or on behalf of the Company or any controlled affiliate of the Company against Indemnitee, Indemnitee’s spouse, heirs, executors or personal or legal representatives after the expiration of two years from the date of accrual of such cause of action, and any claim or cause of action of the Company or its controlled affiliate shall be extinguished and deemed released unless asserted by the timely filing of a legal action within such two-year period; provided, however, if any shorter period of limitations is otherwise applicable to any such cause of action, such shorter period shall govern.

Section 21.Counterparts. This Agreement may be executed in any number of counterparts, all of which shall be considered one and the same agreement and shall become effective when counterparts have been signed by each of the parties hereto and delivered to the other party (including via facsimile or other electronic transmission), it being understood that each party hereto need not sign the same counterpart.

Section 22.Delivery by Electronic Transmission. This Agreement and any signed agreement or instrument entered into in connection with this Agreement or contemplated hereby, and any amendments hereto or thereto, to the extent signed and delivered by means of an electronic transmission, including by a facsimile machine or via email, shall be treated in all manner and respects as an original agreement or instrument and shall be considered to have the same binding legal effect as if it were the original signed version thereof delivered in person. At the request of any party hereto or to any such agreement or instrument, each other party hereto or thereto shall re-execute original forms thereof and deliver them to the other parties. No party hereto or to any such agreement or instrument shall raise the use of electronic transmission by a facsimile machine or via email to deliver a signature or the fact that any signature or agreement or instrument was transmitted or communicated through electronic transmission as a defense to the formation of a contract and each such party forever waives any such defense.

Section 23.Modification and Waiver. No supplement, modification or amendment of this Agreement shall be binding unless executed in writing by both of the parties hereto. No waiver of any of the provisions of this Agreement shall be deemed to, or shall, constitute a waiver of any other provisions hereof (whether or not similar) nor shall such waiver constitute a continuing waiver.

Section 24.Notices. Any notice, report or other communication required or permitted to be given hereunder shall be in writing unless some other method of giving such notice, report or other communication is

accepted by the party to whom it is given, and shall be given by being delivered at the following addresses to the parties hereto:

(a)If to Indemnitee, to: The address set forth on the signature page hereto.

(b)If to the Company, to:

Industrial Logistics Properties Trust
Two Newton Place
255 Washington Street, Suite 300
Newton, Massachusetts 02458-1634
Attn: Secretary

or to such other address as may have been furnished to the Indemnitee by the Company or to the Company by Indemnitee, as the case may be.

Section 25.Governing Law. The provisions of this Agreement and any Dispute, whether in contract, tort or otherwise, shall be governed by and construed in accordance with the laws of the State of Maryland without regard to principles of conflicts of law.

Section 26.Interpretation.

(a)(a) Generally. Unless the context otherwise requires, as used in this Agreement: (a) words defined in the singular have the parallel meaning in the plural and vice versa; (b)”Articles,” “Sections,” and “Exhibits” refer to Articles, Sections and Exhibits of this Agreement unless otherwise specified; and (c) “hereto” and “hereunder” and words of like import used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement.

(b)Additional Interpretive Provisions. The headings in this Agreement are for reference purposes only and shall not in any way affect the meaning or interpretation of this Agreement. Any capitalized term used in any Exhibit to this Agreement, but not otherwise defined therein, shall have the meaning as defined in this Agreement. References to any statute shall be deemed to refer to such statute as amended from time to time and to any rules or regulations promulgated thereunder and any successor statute or statutory provision. References to any agreement are to that agreement as amended, modified or supplemented from time to time in accordance with the terms hereof and thereof. References to any Person include the successors and permitted assigns of that Person. Reference to any agreement, document or instrument means the agreement, document or instrument as amended or otherwise modified from time to time in accordance with the terms thereof, and if applicable hereof.

[Signature Page Follows]

IN WITNESS WHEREOF, the undersigned have executed or caused to be executed on their behalf this Agreement as of the date first written above.


						INDUSTRIAL LOGISTICS PROPERTIES TRUST


			By:
			Name:
			Title:

						[INDEMNITEE]



						Indemnitee’s Address:

[Signature Page to Indemnification Agreement]

EXHIBIT A

FORM OF AFFIRMATION AND
UNDERTAKING TO REPAY EXPENSES ADVANCED

To the Board of Trustees of Industrial Logistics Properties Trust:

This affirmation and undertaking is being provided pursuant to that certain Indemnification Agreement dated ___________________, 20__ (the “Indemnification Agreement”), by and between Industrial Logistics Properties Trust, a Maryland real estate investment trust (the “Company”), and the undersigned Indemnitee, pursuant to which I am entitled to advancement of expenses in connection with [Description of Claims/Proceeding] (together, the “Claims”). Terms used, and not otherwise defined, herein shall have the meanings specified in the Indemnification Agreement.

I am subject to the Claims by reason of my Company Status or by reason of alleged actions or omissions by me in such capacity.

I hereby affirm my good faith belief that the standard of conduct necessary for my indemnification has been met.

In consideration of the advancement of Expenses by the Company for attorneys’ fees and related expenses incurred by me in connection with the Claims (the “Advanced Expenses”), I hereby agree that if, in connection with a proceeding regarding the Claim, it is ultimately determined that I am not entitled to indemnification under law with respect to an act or omission by me, then I shall promptly reimburse the portion of the Advanced Expenses relating to the Claim(s) as to which the foregoing findings have been established and which have not been successfully resolved as described in Section 5 of the Indemnification Agreement. To the extent that Advanced Expenses do not relate to specific Claims, I agree that such Advanced Expenses may be allocated on a reasonable and proportionate basis.

IN WITNESS WHEREOF, I have executed this affirmation and undertaking on ____________________, 20__.


WITNESS:




Print name of witness						Print name of witness

Schedule to Exhibit 10.2

The following trustees and executive officers of Industrial Logistics Properties Trust, or ILPT, are parties to Indemnification Agreements with ILPT which are substantially identical in all material respects to the representative Indemnification Agreement filed herewith and are dated as of the respective dates listed below. The other Indemnification Agreements are omitted pursuant to Instruction 2 to Item 601 of Regulation S-K.


Name of Signatory			Date
Tiffany Sy			October 1, 2023
Matthew P. Jordan			June 1, 2022
June S. Youngs			March 28, 2022
Yael Duffy			March 2, 2020
Kevin C. Phelan			February 21, 2020
Bruce M. Gans			January 11, 2018
Lisa Harris Jones			January 11, 2018
Joseph L. Morea			January 11, 2018
Adam D. Portnoy			January 11, 2018

Exhibit 31.1

CERTIFICATION PURSUANT TO EXCHANGE ACT RULES 13a-14(a) AND 15d-14(a)

I, Adam D. Portnoy, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Industrial Logistics Properties Trust;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, 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;

c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: October 25, 2023

/s/ Adam D. Portnoy

Adam D. Portnoy

Managing Trustee

Exhibit 31.2

CERTIFICATION PURSUANT TO EXCHANGE ACT RULES 13a-14(a) AND 15d-14(a)

I, Matthew P. Jordan, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Industrial Logistics Properties Trust;

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: October 25, 2023

/s/ Matthew P. Jordan

Matthew P. Jordan

Managing Trustee

Exhibit 31.3

CERTIFICATION PURSUANT TO EXCHANGE ACT RULES 13a-14(a) AND 15d-14(a)

I, Yael Duffy, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Industrial Logistics Properties Trust;

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: October 25, 2023

/s/ Yael Duffy

Yael Duffy

President and Chief Operating Officer

Exhibit 31.4

CERTIFICATION PURSUANT TO EXCHANGE ACT RULES 13a-14(a) AND 15d-14(a)

I, Tiffany R. Sy, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Industrial Logistics Properties Trust;

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: October 25, 2023

/s/ Tiffany R. Sy

Tiffany R. Sy

Chief Financial Officer and Treasurer

Exhibit 32.1

Certification Pursuant to 18 U.S.C. Sec. 1350

_______________________________________________

In connection with the filing by Industrial Logistics Properties Trust (the “Company”) of the Quarterly Report on Form 10-Q for the period ended September 30, 2023 (the “Report”), each of the undersigned hereby certifies, to the best of his or her knowledge:

1)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


9
/s/ Adam D. Portnoy						/s/ Yael Duffy
Adam D. Portnoy						Yael Duffy
Managing Trustee						President and Chief Operating Officer

/s/ Matthew P. Jordan						/s/ Tiffany R. Sy
Matthew P. Jordan						Tiffany R. Sy
Managing Trustee						Chief Financial Officer and Treasurer


Date: October 25, 2023

Cover Page - shares	9 Months Ended
Cover Page - shares	Sep. 30, 2023	Oct. 23, 2023
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2023
Document Transition Report	false
Entity File Number	001-38342
Entity Registrant Name	INDUSTRIAL LOGISTICS PROPERTIES TRUST
Entity Incorporation, State or Country Code	MD
Entity Tax Identification Number	82-2809631
Entity Address, Address Line One	Two Newton Place,
Entity Address, Address Line Two	255 Washington Street,
Entity Address, Address Line Three	Suite 300,
Entity Address, City or Town	Newton,
Entity Address, State or Province	MA
Entity Address, Postal Zip Code	02458-1634
City Area Code	617
Local Phone Number	219-1460
Title of 12(b) Security	Common Shares of Beneficial Interest
Trading Symbol	ILPT
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		65,843,823
Entity Central Index Key	0001717307
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q3

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)
$ in Thousands

Sep. 30, 2023

Dec. 31, 2022

Real estate properties:

Land

$ 1,110,279

$ 1,117,779

Buildings and improvements

4,017,355

4,058,329

Total real estate properties, gross

5,127,634

5,176,108

Accumulated depreciation

(361,814)

(273,467)

Total real estate properties, net

4,765,820

4,902,641

Assets of properties held for sale

57,606

Investment in unconsolidated joint venture

124,411

124,358

Acquired real estate leases, net

254,968

297,445

Cash and cash equivalents

83,283

48,261

Restricted cash

139,220

^[1]

92,519

Rents receivable, including straight line rents of $91,218 and $80,710, respectively

113,665

107,011

Other assets, net

95,342

103,931

Total assets

5,634,315

5,676,166

LIABILITIES AND EQUITY

Mortgages and notes payable, net

4,303,631

4,244,501

Liabilities of properties held for sale

1,156

Assumed real estate lease obligations, net

19,466

22,523

Total liabilities

4,416,177

4,345,395

Commitments and contingencies

Equity:

Common shares of beneficial interest, $.01 par value: 100,000,000 shares authorized; 65,845,073 and 65,568,145 shares issued and outstanding, respectively

658

656

Additional paid in capital

1,015,468

1,014,201

Cumulative net income

40,436

117,185

Cumulative other comprehensive income

22,142

21,903

Cumulative common distributions

(365,189)

(363,221)

Total equity attributable to common shareholders

713,515

790,724

Noncontrolling interest

504,623

540,047

Total equity

1,218,138

1,330,771

Total liabilities and equity

5,634,315

5,676,166

Nonrelated Party

LIABILITIES AND EQUITY

Accounts payable and other liabilities

86,028

73,547

Related Party

LIABILITIES AND EQUITY

Accounts payable and other liabilities

$ 5,896

$ 4,824

[1]	Restricted cash consists of amounts escrowed for capital expenditures at certain of our mortgaged properties and cash held for the operations of our consolidated joint venture.

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Statement of Financial Position [Abstract]
Straight line rents	$ 91,218	$ 80,710
Common stock, par value per share (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	100,000,000	100,000,000
Common shares, shares issued (in shares)	65,845,073	65,568,145
Common shares, shares outstanding (in shares)	65,845,073	65,568,145

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Revenues [Abstract]
Rental income	$ 110,142	$ 103,215	$ 328,443	$ 281,812
Expenses:
Real estate taxes	14,926	13,749	46,493	36,460
Other operating expenses	9,907	8,453	27,744	22,278
Depreciation and amortization	43,912	48,519	134,278	114,096
General and administrative	7,712	9,110	23,750	24,896
Acquisition and other transaction related costs	0	586	0	586
Loss on impairment of real estate	0	0	254	100,747
Total expenses	76,457	80,417	232,519	299,063
Interest and other income	2,397	1,068	5,340	1,900
Interest expense (including net amortization of debt issuance costs, premiums and discounts of $6,743, $35,496, $20,177, and $90,265, respectively)	(72,941)	(89,739)	(215,558)	(208,286)
Loss on sale of real estate	0	0	(974)	(10)
Loss on equity securities	0	0	0	(5,758)
Loss on early extinguishment of debt	0	(21,370)	(359)	(22,198)
Loss before income tax expense and equity in earnings of unconsolidated joint venture	(36,859)	(87,243)	(115,627)	(251,603)
Income tax expense	(51)	(28)	(113)	(113)
Equity in earnings of unconsolidated joint venture		3,297	7,423	6,634
Net loss	(36,191)	(83,974)	(108,317)	(245,082)
Net loss attributable to noncontrolling interest	10,079	38,347	31,568	49,402
Net loss attributable to common shareholders	(26,112)	(45,627)	(76,749)	(195,680)
Other comprehensive income:
Unrealized (loss) gain on derivative instrument recognized in cumulative other comprehensive loss	(6,635)	8,847	(3,392)	18,917
Less: unrealized loss (gain) on derivatives attributable to noncontrolling interest	2,290	(4,119)	3,631	(6,617)
Other comprehensive (loss) income attributable to common shareholders	(4,345)	4,728	239	12,300
Comprehensive loss attributable to common shareholders	$ (30,457)	$ (40,899)	$ (76,510)	$ (183,380)
Weighted average common shares outstanding - basic (in shares)	65,488	65,250	65,389	65,228
Weighted average common shares outstanding - diluted (in shares)	65,488	65,250	65,389	65,228
Per common share data (basic and diluted):
Net loss attributable to common shareholders, basic (in dollars per share)	$ (0.40)	$ (0.70)	$ (1.17)	$ (3.00)
Net loss attributable to common shareholders, diluted (in dollars per share)	$ (0.40)	$ (0.70)	$ (1.17)	$ (3.00)

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Parenthetical) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Income Statement [Abstract]
Amortization of debt issuance costs and premium	$ 6,743	$ 35,496	$ 20,177	$ 90,265

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) $ in Thousands	Total	Total Equity Attributable to Common Shareholders	Common shares	Additional Paid-in Capital	Cumulative Net Income	Cumulative Other Comprehensive Income	Cumulative Common Distributions	Total Attributable to Noncontrolling Interest
Beginning balance (in shares) at Dec. 31, 2021			65,404,592
Beginning balance at Dec. 31, 2021	$ 1,038,042	$ 1,038,042	$ 654	$ 1,012,224	$ 343,908	$ 0	$ (318,744)	$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(9,787)	(6,514)			(6,514)			(3,273)
Share grants, repurchases and forfeitures (in shares)			(733)
Share grants, repurchases and forfeitures	398	398		398
Other comprehensive income (loss)	5,632	3,908				3,908		1,724
Contributions from noncontrolling interest	591,268							591,268
Distributions to common shareholders	(21,584)	(21,584)					(21,584)
Ending balance (in shares) at Mar. 31, 2022			65,403,859
Ending balance at Mar. 31, 2022	1,603,969	1,014,250	$ 654	1,012,622	337,394	3,908	(340,328)	589,719
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(151,321)	(143,539)			(143,539)			(7,782)
Share grants, repurchases and forfeitures (in shares)			23,600
Share grants, repurchases and forfeitures	796	796		796
Other comprehensive income (loss)	4,438	3,664				3,664		774
Distributions to noncontrolling interest	(1,365)							(1,365)
Distributions to common shareholders	(21,583)	(21,583)					(21,583)
Ending balance (in shares) at Jun. 30, 2022			65,427,459
Ending balance at Jun. 30, 2022	1,434,934	853,588	$ 654	1,013,418	193,855	7,572	(361,911)	581,346
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(83,974)	(45,627)			(45,627)			(38,347)
Share grants, repurchases and forfeitures (in shares)			141,245
Share grants, repurchases and forfeitures	386	386	$ 2	384
Other comprehensive income (loss)	8,847	4,728				4,728		4,119
Contributions from noncontrolling interest	1,971							1,971
Distributions to common shareholders	(654)	(654)					(654)
Ending balance (in shares) at Sep. 30, 2022			65,568,704
Ending balance at Sep. 30, 2022	$ 1,361,510	812,421	$ 656	1,013,802	148,228	12,300	(362,565)	549,089
Beginning balance (in shares) at Dec. 31, 2022	65,568,145		65,568,145
Beginning balance at Dec. 31, 2022	$ 1,330,771	790,724	$ 656	1,014,201	117,185	21,903	(363,221)	540,047
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(35,546)	(24,809)			(24,809)			(10,737)
Share grants, repurchases and forfeitures (in shares)			(2,176)
Share grants, repurchases and forfeitures	384	384		384
Other comprehensive income (loss)	(8,778)	(7,018)				(7,018)		(1,760)
Distributions to common shareholders	(656)	(656)					(656)
Ending balance (in shares) at Mar. 31, 2023			65,565,969
Ending balance at Mar. 31, 2023	$ 1,286,175	758,625	$ 656	1,014,585	92,376	14,885	(363,877)	527,550
Beginning balance (in shares) at Dec. 31, 2022	65,568,145		65,568,145
Beginning balance at Dec. 31, 2022	$ 1,330,771	790,724	$ 656	1,014,201	117,185	21,903	(363,221)	540,047
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Distributions to common shareholders	$ (1,968)
Ending balance (in shares) at Sep. 30, 2023	65,845,073		65,845,073
Ending balance at Sep. 30, 2023	$ 1,218,138	713,515	$ 658	1,015,468	40,436	22,142	(365,189)	504,623
Beginning balance (in shares) at Mar. 31, 2023			65,565,969
Beginning balance at Mar. 31, 2023	1,286,175	758,625	$ 656	1,014,585	92,376	14,885	(363,877)	527,550
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(36,580)	(25,828)			(25,828)			(10,752)
Share grants, repurchases and forfeitures (in shares)			131,990
Share grants, repurchases and forfeitures	554	554	$ 1	553
Other comprehensive income (loss)	12,021	11,602				11,602		419
Distributions to noncontrolling interest	(225)							(225)
Distributions to common shareholders	(656)	(656)					(656)
Ending balance (in shares) at Jun. 30, 2023			65,697,959
Ending balance at Jun. 30, 2023	1,261,289	744,297	$ 657	1,015,138	66,548	26,487	(364,533)	516,992
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(36,191)	(26,112)			(26,112)			(10,079)
Share grants, repurchases and forfeitures (in shares)			147,114
Share grants, repurchases and forfeitures	331	331	$ 1	330
Other comprehensive income (loss)	(6,635)	(4,345)				(4,345)		(2,290)
Distributions to common shareholders	$ (656)	(656)					(656)
Ending balance (in shares) at Sep. 30, 2023	65,845,073		65,845,073
Ending balance at Sep. 30, 2023	$ 1,218,138	$ 713,515	$ 658	$ 1,015,468	$ 40,436	$ 22,142	$ (365,189)	$ 504,623

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)
$ in Thousands

9 Months Ended

Sep. 30, 2023

Sep. 30, 2022

CASH FLOWS FROM OPERATING ACTIVITIES:

Net loss

$ (108,317)

$ (245,082)

Adjustments to reconcile net loss to net cash provided by operating activities:

Depreciation

93,545

75,014

Loss on impairment of real estate

254

100,747

Net amortization of debt issuance costs, premiums and discounts

20,177

90,265

Amortization of acquired real estate leases and assumed real estate lease obligations

38,275

33,680

Amortization of deferred leasing costs

1,723

1,170

Loss on equity securities

5,758

Straight line rental income

(10,531)

(8,170)

Loss on early extinguishment of debt

359

22,198

Loss on sale of real estate

974

Proceeds from settlement of derivatives

(40,426)

Other non-cash expenses

19,865

4,443

Distributions of earnings from unconsolidated joint venture

2,970

3,962

Equity in earnings of unconsolidated joint venture

(7,423)

(6,634)

Change in assets and liabilities:

Rents receivable

3,260

(16,299)

Other assets

(11,459)

3,615

Accounts payable and other liabilities

9,745

14,921

Due to related persons

1,072

2,309

Net cash provided by operating activities

14,063

81,907

CASH FLOWS FROM INVESTING ACTIVITIES:

Real estate acquisitions

(3,589,085)

Real estate improvements

(13,649)

(8,741)

Proceeds from sale of marketable securities

140,792

Proceeds from sale of real estate

243

Proceeds from settlement of derivatives

40,426

Distributions in excess of earnings from unconsolidated joint venture

4,400

Net cash provided by (used in) investing activities

31,420

(3,457,034)

CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from issuance of mortgage notes payable

91,000

3,335,000

Repayment of mortgage notes payable

(50,993)

(12,591)

Proceeds from secured bridge loan facility

1,385,158

Repayment of secured bridge loan facility

(1,385,158)

Borrowings under revolving credit facility

3,000

Repayments of revolving credit facility

(185,000)

Payment of debt issuance costs

(1,414)

(211,996)

Distributions to common shareholders

(1,968)

(43,821)

Proceeds from sale of noncontrolling interest, net

589,411

Repurchase of common shares

(160)

(239)

Distributions to noncontrolling interest

(225)

(1,365)

Net cash provided by financing activities

36,240

3,472,399

Increase in cash, cash equivalents and restricted cash

81,723

97,272

Cash, cash equivalents and restricted cash at beginning of period

140,780

29,397

Cash, cash equivalents and restricted cash at end of period

222,503

126,669

SUPPLEMENTAL DISCLOSURES:

Interest paid

218,369

113,748

Income taxes paid

223

Interest capitalized

545

NON-CASH INVESTING ACTIVITIES:

Real estate acquired by assumption of mortgage notes payable

323,432

Real estate improvements accrued not paid

2,810

7,165

NON-CASH FINANCING ACTIVITIES:

Assumption of mortgage notes payable

(323,432)

SUPPLEMENTAL DISCLOSURE OF CASH, CASH EQUIVALENTS AND RESTRICTED CASH:

Cash and cash equivalents

83,283

26,381

Restricted cash

^[1]

139,220

100,288

Total cash, cash equivalents and restricted cash shown in the statements of cash flows

$ 222,503

$ 126,669

[1]	Restricted cash consists of amounts escrowed for capital expenditures at certain of our mortgaged properties and cash held for the operations of our consolidated joint venture.

Basis of Presentation	9 Months Ended
Basis of Presentation	Sep. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation	Basis of PresentationThe accompanying condensed consolidated financial statements of Industrial Logistics Properties Trust and its consolidated subsidiaries, or the Company, ILPT, we, us or our, are unaudited. Certain information and disclosures required by U.S. generally accepted accounting principles, or GAAP, for complete financial statements have been condensed or omitted. We believe the disclosures made are adequate to make the information presented not misleading. However, the accompanying condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes contained in our Annual Report on Form 10-K for the year ended December 31, 2022, or our 2022 Annual Report. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair statement of results for the interim period have been included. All intercompany transactions and balances with or among our consolidated subsidiaries have been eliminated. Our operating results for interim periods are not necessarily indicative of the results that may be expected for the full year.The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect reported amounts. Actual results could differ from those estimates. Significant estimates in the condensed consolidated financial statements include purchase price allocations, useful lives of fixed assets, and assessment of impairment of real estate and related intangibles.

Real Estate Investments	9 Months Ended
Real Estate Investments	Sep. 30, 2023
Real Estate [Abstract]
Real Estate Investments	Real Estate Investments As of September 30, 2023, our portfolio was comprised of 413 consolidated properties containing approximately 59,983,000 rentable square feet, including 226 buildings, leasable land parcels and easements containing approximately 16,729,000 rentable square feet of primarily industrial lands located on the island of Oahu, Hawaii, or our Hawaii Properties, and 187 industrial properties containing approximately 43,254,000 rentable square feet located in 38 other states, or our Mainland Properties, which included 94 properties in 27 states totaling approximately 20,981,000 rentable square feet, owned by a consolidated joint venture in which we own a 61% equity interest. As of September 30, 2023, we also owned a 22% equity interest in an unconsolidated joint venture which owns 18 industrial properties located in 12 states totaling approximately 11,726,000 rentable square feet. We operate in one business segment: ownership and leasing of properties that include industrial and logistics buildings and leased industrial lands. We incurred capital expenditures and leasing costs at certain of our properties of $5,275 and $8,574 during the three months ended September 30, 2023 and 2022, respectively, and $17,857 and $22,419 for the nine months ended September 30, 2023 and 2022, respectively. During the nine months ended September 30, 2023, we committed $7,273 for expenditures related to tenant improvements and leasing costs for leases executed during the period for approximately 3,868,000 rentable square feet. Committed, but unspent, tenant related obligations based on existing leases as of September 30, 2023 were $5,923, of which $3,529 is expected to be spent during the next 12 months. Impairment We regularly evaluate whether events or changes in circumstances have occurred that could indicate an impairment in the value of long lived assets. Impairment indicators may include declining tenant occupancy, lack of progress leasing vacant space, tenant bankruptcies, low long term prospects for improvement in property performance, weak or declining tenant profitability, cash flow or liquidity, our decision to dispose of an asset before the end of its estimated useful life and legislative, market or industry changes that could permanently reduce the value of a property. 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. If the carrying value exceeds the projected undiscounted cash flows, 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 useful lives of our long lived assets. If we change our estimate of the remaining useful lives, we allocate the carrying value of the affected assets over their revised remaining useful lives. During the nine months ended September 30, 2023, we recognized a loss on impairment of real estate of $254 to reduce the carrying value of a property that was classified as held for sale at September 30, 2023 to its estimated sales price less costs to sell. During the nine months ended September 30, 2022, we recognized a $100,747 loss on impairment for 25 properties we acquired as part of our acquisition of Monmouth Real Estate Investment Corporation, or MNR, on February 25, 2022, to adjust the carrying value of these properties to their estimated fair value. Disposition Activities In March 2023, we received gross proceeds of $270 and recognized a $974 net loss on sale of real estate as a result of a property in Everett, Washington partially taken by eminent domain. As of September 30, 2023, we had three Mainland Properties with an aggregate carrying value of $56,944, classified as held for sale in our condensed consolidated balance sheet. As of October 25, 2023, one of these properties is under agreement to sell for a sales price of $21,500, excluding closing costs. This pending sale is subject to conditions; accordingly, we cannot be sure that we will complete this sale, that this sale will not be delayed or that the terms will not change. We terminated agreements to sell two of these properties for an aggregate sales price of $43,765 and we continue to market one of these two properties for sale. Consolidated Joint Venture We own a 61% equity interest in Mountain Industrial REIT LLC, or Mountain JV, or our consolidated joint venture, which owns 94 properties in 27 states totaling approximately 20,981,000 rentable square feet. We control our consolidated joint venture and therefore account for the properties owned by this joint venture on a consolidated basis in our condensed consolidated financial statements. We recognized a 39% noncontrolling interest in our condensed consolidated financial statements for the three months ended September 30, 2023 and 2022, for the nine months ended September 30, 2023 and the period from this joint venture’s formation date, February 25, 2022 to September 30, 2022. The portion of this joint venture's net loss not attributable to us, or $10,238 and $38,318, for the three months ended September 30, 2023 and 2022, respectively, and $31,642 and $49,360 for the nine months ended September 30, 2023 and for the period from February 25, 2022 to September 30, 2022, respectively, is reported as net loss attributable to noncontrolling interest in our condensed consolidated statements of comprehensive income (loss). As of September 30, 2023, our consolidated joint venture had total assets of $3,065,834 and total liabilities of $1,781,222. Consolidated Tenancy in Common An unrelated third party owns an approximate 33% tenancy in common interest in one property located in Somerset, New Jersey with approximately 64,000 rentable square feet, and we own the remaining 67% tenancy in common interest in this property. The portion of this property’s net income (loss) not attributable to us, or $159 and ($29), for the three months ended September 30, 2023 and 2022, respectively, and $74 and ($42) for the nine months ended September 30, 2023 and the period from the date we acquired our interest in this property, February 25, 2022 to September 30, 2022, respectively, is reported as net loss attributable to noncontrolling interest in our condensed consolidated statements of comprehensive income (loss). During the nine months ended September 30, 2023, this tenancy in common made cash distributions of $225 to the unrelated third party investor, which is reflected as a decrease in noncontrolling interest in our condensed consolidated balance sheet. Unconsolidated Joint Venture We own a 22% equity interest in The Industrial Fund REIT LLC, or the unconsolidated joint venture, which owns 18 industrial properties located in 12 states totaling approximately 11,726,000 rentable square feet. We account for the unconsolidated joint venture under the equity method of accounting under the fair value option. We recognize changes in the fair value of our investment in the unconsolidated joint venture as equity in earnings of the unconsolidated joint venture in our condensed consolidated statements of comprehensive income (loss).

Leases	9 Months Ended
Leases	Sep. 30, 2023
Leases [Abstract]
Leases	Leases We are a lessor of industrial and logistics properties. Our leases provide our tenants with the contractual right to use and economically benefit from all the physical space specified in their respective leases; therefore, we have determined to evaluate our leases as lease arrangements. We recognize rental income from operating leases 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 $3,414 and $3,794 to record revenue on a straight line basis during the three months ended September 30, 2023 and 2022, respectively, and $10,531 and $8,170 for the nine months ended September 30, 2023 and 2022, 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 $19,310 and $16,664 for the three months ended September 30, 2023 and 2022, respectively, and $58,700 and $46,071 for the nine months ended September 30, 2023 and 2022, respectively. Generally, payments of ground lease obligations are made by our tenants. However, if a tenant does not perform obligations under a ground lease or does not renew any ground lease, we may have to perform obligations under, or renew, the ground lease in order to protect our investment in the affected property. We define annualized rental revenues as the annualized contractual base rents from our tenants pursuant to our lease agreements as of the measurement date, including straight line rent adjustments and estimated recurring expense reimbursements to be paid to us, and excluding lease value amortization. Right of Use Assets and Lease Liabilities We are the lessee for three of our properties subject to ground leases and one office property that we assumed as part of our acquisition of MNR. For leases with a term greater than 12 months under which we are the lessee, we are required to record a right of use asset and lease liability. The values of our right of use assets and related lease liabilities were $4,757 and $4,837, respectively, as of September 30, 2023, and $5,084 and $5,149, respectively, as of December 31, 2022. Our right of use assets and related lease liabilities are included in other assets, net and accounts payable and other liabilities, respectively, in our condensed consolidated balance sheets. We sublease a portion of our office property assumed in the acquisition of MNR. Rent expense incurred under this lease, net of sublease revenue, was $12 and $176 for three months ended September 30, 2023 and 2022, respectively, and $141 and $355 for the nine months ended September 30, 2023 and the period from February 25, 2022 to September 30, 2022, respectively. Rent expense is included in general and administrative expense in our condensed consolidated statements of comprehensive income (loss). Tenant Concentration Subsidiaries of FedEx Corporation and Amazon.com Services, Inc. were responsible for approximately 29.8% and 6.7% of our annualized rental revenues as of September 30, 2023, respectively, and 29.6% and 6.8% as of September 30, 2022, respectively. Geographic Concentration For the three months ended September 30, 2023 and 2022, approximately 28.1% and 26.8%, respectively, of our rental income was from our Hawaii Properties. For the nine months ended September 30, 2023 and 2022, approximately 27.9% and 30.6%, respectively, of our rental income was from our Hawaii Properties.

Indebtedness

9 Months Ended

Sep. 30, 2023

Debt Disclosure [Abstract]

Indebtedness

As of September 30, 2023 and December 31, 2022, our outstanding indebtedness consisted of the following:





	Number of		Principal Balance at								Carrying Value of Collateral at
	Properties		September 30,		December 31,		Interest				September 30,		December 31,
Entity	Secured By		2023		2022		Rate (1)	Type	Maturity		2023		2022

ILPT	104		$	1,235,000	$	1,235,000	6.18%	Floating	10/9/2024		$	1,049,983	$	1,071,815
ILPT	186		650,000		650,000		4.31%	Fixed	2/7/2029		489,901		490,416
ILPT	17		700,000		700,000		4.42%	Fixed	3/9/2032		508,383		518,806
Mountain JV	82		1,400,000		1,400,000		6.17%	Floating	3/9/2024		1,870,541		1,909,185
Mountain JV	4		91,000		—		6.25%	Fixed	6/10/2030		184,375		—
Mountain JV	1		11,712		12,691		3.67%	Fixed	5/1/2031		29,094		30,800
Mountain JV	1		13,228		14,144		4.14%	Fixed	7/1/2032		43,826		44,777
Mountain JV	1		29,213		30,949		4.02%	Fixed	10/1/2033		85,380		87,143
Mountain JV	1		40,832		43,219		4.13%	Fixed	11/1/2033		130,197		131,539
Mountain JV	1		24,873		26,175		3.10%	Fixed	6/1/2035		46,725		47,718
Mountain JV	1		40,087		42,087		2.95%	Fixed	1/1/2036		99,805		101,896
Mountain JV	1		44,423		46,109		4.27%	Fixed	11/1/2037		110,881		113,063
Mountain JV	1		50,002		52,031		3.25%	Fixed	1/1/2038		114,259		116,607
Mountain JV	1		—		13,556		N/A	Fixed	10/1/2028		—		63,314
Mountain JV	1		—		4,865		N/A	Fixed	4/1/2030		—		39,724
Mountain JV	1		—		5,145		N/A	Fixed	4/1/2030		—		39,724
Mountain JV	1		—		14,392		N/A	Fixed	9/1/2030		—		50,825
Total / weighted average	4,330,370		4,290,363		5.47%				$	4,763,350	$	4,857,352
Unamortized debt issuance costs	(26,739)		(45,862)
Total indebtedness, net	$	4,303,631	$	4,244,501

(1)Interest rates are as of September 30, 2023 and reflect the impact of interest rate caps, if any, and exclude the impact of the amortization of debt issuance costs, premiums and discounts.

See Note 9 for more information regarding our interest rate caps.

Fair Value of Assets and Liabilities

9 Months Ended

Sep. 30, 2023

Fair Value Disclosures [Abstract]

Fair Value of Assets and Liabilities


	At September 30, 2023				At December 31, 2022
	Carrying				Carrying
	Value (1)		Fair Value		Value (1)		Fair Value
Fixed rate loan, 4.31% interest rate, due in 2029	$	647,077	$	613,520	$	646,669	$	592,295
Fixed rate loan, 6.25% interest rate, due in 2030	90,038		94,438		—		—
Fixed rate loan, 3.67% interest rate, due in 2031	11,712		11,009		12,691		11,713
Fixed rate loan, 4.42% interest rate, due in 2032	695,134		609,714		694,704		623,133
Fixed rate loan, 4.14% interest rate, due in 2032	13,228		12,611		14,144		13,182
Fixed rate loan, 4.02% interest rate, due in 2033	29,213		27,185		30,949		28,195
Fixed rate loan, 4.13% interest rate, due in 2033	40,832		38,181		43,219		39,573
Fixed rate loan, 3.10% interest rate, due in 2035	24,873		21,837		26,175		22,373
Fixed rate loan, 2.95% interest rate, due in 2036	40,087		34,723		42,087		35,444
Fixed rate loan, 4.27% interest rate, due in 2037	44,423		41,466		46,109		41,880
Fixed rate loan, 3.25% interest rate, due in 2038	50,001		43,463		52,031		43,878
Fixed rate loan, 3.76% interest rate, due in 2028 (2)	—		—		13,556		12,784
Fixed rate loan, 3.77% interest rate, due in 2030 (2)	—		—		4,865		4,553
Fixed rate loan, 3.85% interest rate, due in 2030 (2)	—		—		5,145		4,829
Fixed rate loan, 3.56% interest rate, due in 2030 (2)	—		—		14,392		13,315
	$	1,686,618	$	1,548,147	$	1,646,736	$	1,487,147

(1)Includes unamortized debt issuance costs, premiums and discounts of $8,751 and $8,628 at September 30, 2023 and December 31, 2022, respectively.

(2)This loan was repaid in May 2023.

We estimate the fair value of our mortgage notes payable using significant unobservable inputs (Level 3), such as discounted cash flow analyses and prevailing market rates as of the measurement date.


			Quoted Prices in		Significant Other		Significant
			Active Markets for		Observable		Unobservable
			Identical Assets		Inputs		Inputs
	Total		(Level 1)		(Level 2)		(Level 3)
At September 30, 2023
Recurring fair value measurements
Investment in unconsolidated joint venture	$	124,411	$	—	$	—	$	124,411
Interest rate cap derivatives (1)	$	51,322	$	—	$	51,322	$	—
Non-recurring fair value measurements
Real estate properties (2)	$	1,414	$	—	$	—	$	1,414

At December 31, 2022
Recurring fair value measurements
Investment in unconsolidated joint venture	$	124,358	$	—	$	—	$	124,358
Interest rate cap derivatives (1)	$	73,133	$	—	$	73,133	$	—
Non-recurring fair value measurements
Real estate properties (2)	$	555,123	$	—	$	—	$	555,123

(1)The estimated fair values of our interest rate cap derivatives are based on then current market prices in secondary markets for similar derivative contracts.

Exit

Capitalization

Valuation Technique

Discount Rates

Rates

Holding Periods

At September 30, 2023

Investment in unconsolidated joint venture

Discounted cash flow

5.25% - 7.00%

4.95% - 6.00%

10 - 12 years

At December 31, 2022

Investment in unconsolidated joint venture

Discounted cash flow

5.25% - 7.00%

4.75% - 6.00%

10 years

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


	Three Months				Nine Months
	Ended September 30,				Ended September 30,
	2023		2022		2023		2022
Beginning balance	$	129,082	$	143,716	$	124,358	$	143,021
Equity in earnings of unconsolidated joint venture	719		3,297		7,423		6,634
Distributions from unconsolidated joint venture	(5,390)		(1,320)		(7,370)		(3,962)
Ending balance	$	124,411	$	145,693	$	124,411	$	145,693

Shareholders' Equity

9 Months Ended

Sep. 30, 2023

Equity [Abstract]

Shareholders' Equity

Shareholders’ Equity

Common Share Awards

Common Share Purchases

Distributions

During the nine months ended September 30, 2023, we declared and paid regular quarterly distributions to common shareholders as follows:


Declaration Date	Record Date	Payment Date	Distribution Per Share		Total Distribution
January 12, 2023	January 23, 2023	February 16, 2023	$	0.01	$	656
April 13, 2023	April 24, 2023	May 18, 2023	0.01		656
July 13, 2023	July 24, 2023	August 17, 2023	0.01		656
			$	0.03	$	1,968

Business and Property Management Agreements with RMR	9 Months Ended
Business and Property Management Agreements with RMR	Sep. 30, 2023
Related Party Transactions [Abstract]
Business and Property Management Agreements with RMR	Business and Property Management Agreements with RMR We have no employees. The personnel and various services we require to operate our business are provided to us by RMR. We have two agreements with RMR 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. Pursuant to our business management agreement with RMR, we recognized net business management fees of $5,919 and $17,301 for the three and nine months ended September 30, 2023, respectively, and $6,465 and $17,821 for the three and nine months ended September 30, 2022, respectively. Based on our common share total return, as defined in our business management agreement, as of September 30, 2023 and 2022, no incentive fees are included in the net business management fees we recognized for the three and nine months ended September 30, 2023 or 2022. The actual amount of annual incentive fees for 2023, if any, will be based on our common share total return, as defined in our business management agreement, for the three-year period ending December 31, 2023, and will be payable in January 2024. We did not incur any incentive fee payable to RMR for the year ended December 31, 2022. We include business management fees in general and administrative expenses in our condensed consolidated statements of comprehensive income (loss). Pursuant to our property management agreement with RMR, we recognized aggregate property management and construction supervision fees of $3,464 and $10,286 for the three and nine months ended September 30, 2023, respectively, and $3,270 and $8,797 for the three and nine months ended September 30, 2022, respectively. Of these amounts, for the three and nine months ended September 30, 2023, $3,293 and $9,745, respectively, were included in other operating expenses in our condensed consolidated statements of comprehensive income (loss) and $171 and $541, respectively, were capitalized as building improvements in our condensed consolidated balance sheets. For the three and nine months ended September 30, 2022, $2,976 and $8,104, respectively, were included in other operating expenses in our condensed consolidated statements of comprehensive income (loss) and $294 and $693, respectively, were capitalized as buildings and improvements in our condensed consolidated balance sheets. The amounts capitalized are being depreciated over the estimated useful lives of the related capital assets. We are generally responsible for all our operating expenses, including certain expenses incurred or arranged by RMR on our behalf. We are generally not responsible for payment of RMR’s employment, office or administrative expenses incurred to provide management services to us, except for the employment and related expenses of RMR’s employees assigned to work exclusively or partly at our properties, our share of the wages, benefits and other related costs of RMR’s centralized accounting personnel, our share of RMR’s costs for providing our internal audit function, or as otherwise agreed. Our property level operating expenses are generally incorporated into the rents charged to our tenants, including certain payroll and related costs incurred by RMR. We reimbursed RMR $2,375 and $6,216 for these expenses and costs for the three and nine months ended September 30, 2023, respectively, and $1,847 and $5,155 for the three and nine months ended September 30, 2022, respectively. These amounts are included in other operating expenses and general and administrative expenses, as applicable, in our condensed consolidated statements of comprehensive income (loss). Management Agreements Between Our Joint Ventures and RMR. We have two separate joint venture arrangements, our consolidated joint venture and the unconsolidated joint venture. RMR provides management services to both of these joint ventures. We are not obligated to pay management fees to RMR under our management agreements with RMR for the services it provides to the unconsolidated joint venture. We are obligated to pay management fees to RMR under our management agreements with RMR for the services it provides to our consolidated joint venture; however, that joint venture pays management fees directly to RMR, and any such fees paid by our consolidated joint venture are credited against the fees payable by us to RMR. See Note 2 for further information about our joint ventures. See Note 8 for further information regarding our relationships, agreements and transactions with RMR.

Related Person Transactions	9 Months Ended
Related Person Transactions	Sep. 30, 2023
Related Party Transactions [Abstract]
Related Person Transactions	Related Person Transactions We have relationships and historical and continuing transactions with RMR, The RMR Group Inc., or RMR Inc., and others related to them, including other companies to which RMR or its subsidiaries provide management services and some of which have trustees, directors or officers who are also our Trustees or officers. RMR is a majority owned subsidiary of RMR Inc. The Chair of our Board of Trustees and one of our Managing Trustees, Adam D. Portnoy, is the sole trustee, an officer and the controlling shareholder of ABP Trust, which is the controlling shareholder of RMR Inc., the chair of the board of directors, a managing director and the president and chief executive officer of RMR Inc. and an officer and employee of RMR. Matthew P. Jordan, our other Managing Trustee, is an executive vice president and the chief financial officer and treasurer of RMR Inc., an officer and employee of RMR and an officer of ABP Trust. John G. Murray, one of our Managing Trustees until June 1, 2022 and our President and Chief Executive Officer until March 31, 2022, also serves as an officer and employee of RMR, and each of our current officers is also an officer and employee of RMR. Some of our Independent Trustees also serve as independent trustees of other public companies to which RMR or its subsidiaries provide management services. Adam D. Portnoy serves as chair of the boards and as a managing trustee of those companies. Other officers of RMR, including Messrs. Jordan and Murray and certain of our officers, serve as managing trustees or officers of certain of these companies. See Note 6 for information relating to the awards of our common shares we made in September 2023 to our officers and certain other employees of RMR and common shares we purchased from our officers and certain other current and former officers and employees of RMR in satisfaction of tax withholding and payment obligations in connection with the vesting of awards of our common shares. We include amounts recognized as expense for awards of our common shares to our officers and RMR employees in general and administrative expenses in our condensed consolidated statements of comprehensive income (loss). Our Manager, RMR. We have two agreements with RMR to provide management services to us. See Note 7 for further information regarding our management agreements with RMR. Joint Ventures. We have two separate joint venture arrangements. RMR provides management services to each of these joint ventures. As of September 30, 2023 and December 31, 2022, we owed $613 and $616, respectively, to the unconsolidated joint venture for rents that we collected on behalf of that joint venture. These amounts are presented as due to related persons in our condensed consolidated balance sheets. We paid these amounts in October 2023 and January 2023, respectively. See Notes 2 and 7 for further information regarding our joint ventures and RMR’s management agreements with our joint ventures. For further information about these and other such relationships and certain other related person transactions, see our 2022 Annual Report.

Derivatives and Hedging Activities

9 Months Ended

Sep. 30, 2023

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivatives and Hedging Activities

Risk Management Objective of Using Derivatives

Cash Flow Hedges of Interest Rate Risk


Interest Rate	Balance Sheet		Strike	Notional		Fair Value at
Derivative	Line Item	Underlying Instrument	Rate	Amount		September 30, 2023		December 31, 2022
Interest rate cap	Other assets	Floating Rate Loan	3.40%	$	1,400,000	$	12,712	$	23,337
Interest rate cap	Other assets	ILPT Floating Rate Loan	2.25%	$	1,235,000	38,610		49,796
						$	51,322	$	73,133

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


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Amount of gain recognized in cumulative other comprehensive income	$	3,428	$	15,047	$	19,677	$	24,200
Amount reclassified from cumulative other comprehensive income into interest expense	(10,063)		761		(23,069)		1,678
Amount reclassified from cumulative other comprehensive income into loss on early extinguishment of debt	—		(6,961)		—		(6,961)
Unrealized (loss) gain on derivative instrument recognized in cumulative other comprehensive loss	$	(6,635)	$	8,847	$	(3,392)	$	18,917

Basis of Presentation (Policies)	9 Months Ended
Basis of Presentation (Policies)	Sep. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization and Basis of Presentation	The accompanying condensed consolidated financial statements of Industrial Logistics Properties Trust and its consolidated subsidiaries, or the Company, ILPT, we, us or our, are unaudited. Certain information and disclosures required by U.S. generally accepted accounting principles, or GAAP, for complete financial statements have been condensed or omitted. We believe the disclosures made are adequate to make the information presented not misleading. However, the accompanying condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes contained in our Annual Report on Form 10-K for the year ended December 31, 2022, or our 2022 Annual Report. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair statement of results for the interim period have been included. All intercompany transactions and balances with or among our consolidated subsidiaries have been eliminated. Our operating results for interim periods are not necessarily indicative of the results that may be expected for the full year.
Use of Estimates	The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect reported amounts. Actual results could differ from those estimates. Significant estimates in the condensed consolidated financial statements include purchase price allocations, useful lives of fixed assets, and assessment of impairment of real estate and related intangibles.

Indebtedness (Tables)

9 Months Ended

Sep. 30, 2023

Debt Disclosure [Abstract]

Schedule of Outstanding Indebtedness

As of September 30, 2023 and December 31, 2022, our outstanding indebtedness consisted of the following:





	Number of		Principal Balance at								Carrying Value of Collateral at
	Properties		September 30,		December 31,		Interest				September 30,		December 31,
Entity	Secured By		2023		2022		Rate (1)	Type	Maturity		2023		2022

ILPT	104		$	1,235,000	$	1,235,000	6.18%	Floating	10/9/2024		$	1,049,983	$	1,071,815
ILPT	186		650,000		650,000		4.31%	Fixed	2/7/2029		489,901		490,416
ILPT	17		700,000		700,000		4.42%	Fixed	3/9/2032		508,383		518,806
Mountain JV	82		1,400,000		1,400,000		6.17%	Floating	3/9/2024		1,870,541		1,909,185
Mountain JV	4		91,000		—		6.25%	Fixed	6/10/2030		184,375		—
Mountain JV	1		11,712		12,691		3.67%	Fixed	5/1/2031		29,094		30,800
Mountain JV	1		13,228		14,144		4.14%	Fixed	7/1/2032		43,826		44,777
Mountain JV	1		29,213		30,949		4.02%	Fixed	10/1/2033		85,380		87,143
Mountain JV	1		40,832		43,219		4.13%	Fixed	11/1/2033		130,197		131,539
Mountain JV	1		24,873		26,175		3.10%	Fixed	6/1/2035		46,725		47,718
Mountain JV	1		40,087		42,087		2.95%	Fixed	1/1/2036		99,805		101,896
Mountain JV	1		44,423		46,109		4.27%	Fixed	11/1/2037		110,881		113,063
Mountain JV	1		50,002		52,031		3.25%	Fixed	1/1/2038		114,259		116,607
Mountain JV	1		—		13,556		N/A	Fixed	10/1/2028		—		63,314
Mountain JV	1		—		4,865		N/A	Fixed	4/1/2030		—		39,724
Mountain JV	1		—		5,145		N/A	Fixed	4/1/2030		—		39,724
Mountain JV	1		—		14,392		N/A	Fixed	9/1/2030		—		50,825
Total / weighted average	4,330,370		4,290,363		5.47%				$	4,763,350	$	4,857,352
Unamortized debt issuance costs	(26,739)		(45,862)
Total indebtedness, net	$	4,303,631	$	4,244,501

(1)Interest rates are as of September 30, 2023 and reflect the impact of interest rate caps, if any, and exclude the impact of the amortization of debt issuance costs, premiums and discounts.

Fair Value of Assets and Liabilities (Tables)

9 Months Ended

Sep. 30, 2023

Fair Value Disclosures [Abstract]

Schedule of Carrying Value and the Estimated Fair Market Value of Mortgage Notes Payable

At September 30, 2023 and December 31, 2022, the fair value of our financial instruments approximated their carrying values in our condensed consolidated financial statements, due to their short term nature or floating interest rates, except as follows:


	At September 30, 2023				At December 31, 2022
	Carrying				Carrying
	Value (1)		Fair Value		Value (1)		Fair Value
Fixed rate loan, 4.31% interest rate, due in 2029	$	647,077	$	613,520	$	646,669	$	592,295
Fixed rate loan, 6.25% interest rate, due in 2030	90,038		94,438		—		—
Fixed rate loan, 3.67% interest rate, due in 2031	11,712		11,009		12,691		11,713
Fixed rate loan, 4.42% interest rate, due in 2032	695,134		609,714		694,704		623,133
Fixed rate loan, 4.14% interest rate, due in 2032	13,228		12,611		14,144		13,182
Fixed rate loan, 4.02% interest rate, due in 2033	29,213		27,185		30,949		28,195
Fixed rate loan, 4.13% interest rate, due in 2033	40,832		38,181		43,219		39,573
Fixed rate loan, 3.10% interest rate, due in 2035	24,873		21,837		26,175		22,373
Fixed rate loan, 2.95% interest rate, due in 2036	40,087		34,723		42,087		35,444
Fixed rate loan, 4.27% interest rate, due in 2037	44,423		41,466		46,109		41,880
Fixed rate loan, 3.25% interest rate, due in 2038	50,001		43,463		52,031		43,878
Fixed rate loan, 3.76% interest rate, due in 2028 (2)	—		—		13,556		12,784
Fixed rate loan, 3.77% interest rate, due in 2030 (2)	—		—		4,865		4,553
Fixed rate loan, 3.85% interest rate, due in 2030 (2)	—		—		5,145		4,829
Fixed rate loan, 3.56% interest rate, due in 2030 (2)	—		—		14,392		13,315
	$	1,686,618	$	1,548,147	$	1,646,736	$	1,487,147

(1)Includes unamortized debt issuance costs, premiums and discounts of $8,751 and $8,628 at September 30, 2023 and December 31, 2022, respectively.

(2)This loan was repaid in May 2023.

Schedule of Fair Value Measurements, Recurring and Nonrecurring


			Quoted Prices in		Significant Other		Significant
			Active Markets for		Observable		Unobservable
			Identical Assets		Inputs		Inputs
	Total		(Level 1)		(Level 2)		(Level 3)
At September 30, 2023
Recurring fair value measurements
Investment in unconsolidated joint venture	$	124,411	$	—	$	—	$	124,411
Interest rate cap derivatives (1)	$	51,322	$	—	$	51,322	$	—
Non-recurring fair value measurements
Real estate properties (2)	$	1,414	$	—	$	—	$	1,414

At December 31, 2022
Recurring fair value measurements
Investment in unconsolidated joint venture	$	124,358	$	—	$	—	$	124,358
Interest rate cap derivatives (1)	$	73,133	$	—	$	73,133	$	—
Non-recurring fair value measurements
Real estate properties (2)	$	555,123	$	—	$	—	$	555,123

(1)The estimated fair values of our interest rate cap derivatives are based on then current market prices in secondary markets for similar derivative contracts.

Schedule of Quantitative Information of Significant Unobservable Inputs Related to Certain Level 3 Fair Value Measurements

The discount rates, exit capitalization rates and holding periods used are Level 3 significant unobservable inputs and are shown in the table below:

Exit

Capitalization

Valuation Technique

Discount Rates

Rates

Holding Periods

At September 30, 2023

Investment in unconsolidated joint venture

Discounted cash flow

5.25% - 7.00%

4.95% - 6.00%

10 - 12 years

At December 31, 2022

Investment in unconsolidated joint venture

Discounted cash flow

5.25% - 7.00%

4.75% - 6.00%

10 years

Schedule of the Change in Fair Value of the Investment in the Unconsolidated Joint Venture

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


	Three Months				Nine Months
	Ended September 30,				Ended September 30,
	2023		2022		2023		2022
Beginning balance	$	129,082	$	143,716	$	124,358	$	143,021
Equity in earnings of unconsolidated joint venture	719		3,297		7,423		6,634
Distributions from unconsolidated joint venture	(5,390)		(1,320)		(7,370)		(3,962)
Ending balance	$	124,411	$	145,693	$	124,411	$	145,693

Shareholders' Equity (Tables)

9 Months Ended

Sep. 30, 2023

Equity [Abstract]

Schedule of Distributions Declared and Paid

During the nine months ended September 30, 2023, we declared and paid regular quarterly distributions to common shareholders as follows:


Declaration Date	Record Date	Payment Date	Distribution Per Share		Total Distribution
January 12, 2023	January 23, 2023	February 16, 2023	$	0.01	$	656
April 13, 2023	April 24, 2023	May 18, 2023	0.01		656
July 13, 2023	July 24, 2023	August 17, 2023	0.01		656
			$	0.03	$	1,968

Derivatives and Hedging Activities (Tables)

9 Months Ended

Sep. 30, 2023

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Interest Rate Swap Derivatives

The following table summarizes the terms of our outstanding interest rate cap agreements designated as cash flow hedges of interest rate risk at September 30, 2023 and December 31, 2022:


Interest Rate	Balance Sheet		Strike	Notional		Fair Value at
Derivative	Line Item	Underlying Instrument	Rate	Amount		September 30, 2023		December 31, 2022
Interest rate cap	Other assets	Floating Rate Loan	3.40%	$	1,400,000	$	12,712	$	23,337
Interest rate cap	Other assets	ILPT Floating Rate Loan	2.25%	$	1,235,000	38,610		49,796
						$	51,322	$	73,133

Schedule of Effects on Consolidated Statements of Income and Comprehensive Income

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


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Amount of gain recognized in cumulative other comprehensive income	$	3,428	$	15,047	$	19,677	$	24,200
Amount reclassified from cumulative other comprehensive income into interest expense	(10,063)		761		(23,069)		1,678
Amount reclassified from cumulative other comprehensive income into loss on early extinguishment of debt	—		(6,961)		—		(6,961)
Unrealized (loss) gain on derivative instrument recognized in cumulative other comprehensive loss	$	(6,635)	$	8,847	$	(3,392)	$	18,917

Real Estate Investments (Details) ft² in Thousands, $ in Thousands		1 Months Ended	3 Months Ended		7 Months Ended	9 Months Ended
	Oct. 25, 2023 USD ($) property	Mar. 31, 2023 USD ($)	Sep. 30, 2023 USD ($)	Sep. 30, 2022 USD ($)	Sep. 30, 2022 USD ($)	Sep. 30, 2023 USD ($) segment property	Sep. 30, 2022 USD ($) property	Sep. 30, 2023 property	Sep. 30, 2023 ft²	Sep. 30, 2023 building	Sep. 30, 2023 state	Sep. 30, 2023
Real Estate Properties [Line Items]
Number of properties owned \| property								413
Rentable square feet (in sqft) \| ft²									59,983
Number of business segments \| segment						1
Capital expenditures incurred			$ 5,275	$ 8,574		$ 17,857	$ 22,419
Commitments related to tenant improvements and leasing costs						7,273
Tenant improvements (in sqft) \| ft²									3,868
Committed but unspent tenant related obligations			5,923			5,923
Committed but unspent tenant related obligations expected to be spent in the next 12 months			3,529			3,529
Loss on impairment of real estate			0	0		254	100,747
Net income (loss) attributable to noncontrolling interest			(10,079)	(38,347)		(31,568)	(49,402)
Cash distributions						225	1,365
Mountain Industrial REIT LLC
Real Estate Properties [Line Items]
Noncontrolling interest, ownership percentage by noncontrolling owners												39.00%
Subsequent Event \| Mainland Properties
Real Estate Properties [Line Items]
Number of properties \| property	2
Number of real estate properties under agreement to sell \| property	1
Real estate properties under agreement to sell, sales price	$ 21,500
Number of real estate properties, agreement terminated \| property	2
Terminated agreement sales price	$ 43,765
Disposal Group, Held-for-sale, Not Discontinued Operations \| Mainland Properties
Real Estate Properties [Line Items]
Number of properties \| property								3
Aggregate sales price excluding closing costs			56,944			56,944
Disposal Group, Held-for-sale, Not Discontinued Operations \| Subsequent Event \| Mainland Properties
Real Estate Properties [Line Items]
Number of properties \| property	1
Mountain Industrial REIT LLC
Real Estate Properties [Line Items]
Net income (loss) attributable to noncontrolling interest			(10,238)	(38,318)	$ (49,360)	(31,642)
Mountain Industrial REIT LLC \| Other Joint Venture Investor
Real Estate Properties [Line Items]
Joint venture, total assets			3,065,834			3,065,834
Joint venture, liabilities			1,781,222			1,781,222
Twelve Mainland Properties
Real Estate Properties [Line Items]
Rentable square feet (in sqft) \| ft²									11,726
Number of states where real estate is located \| state											12
Ownership interest (as percent)												22.00%
Number of properties contributed \| property								18
Monmouth Real Estate Investment Corporation
Real Estate Properties [Line Items]
Loss on impairment of real estate							$ 100,747
Number of properties \| property							25
Tenancy in Common \| Unrelated Third Party
Real Estate Properties [Line Items]
Cash distributions						$ 225
Consolidated \| Mountain Industrial REIT LLC
Real Estate Properties [Line Items]
Number of properties owned \| property								94
Rentable square feet (in sqft) \| ft²									20,981
Number of states where real estate is located								27,000			27
Ownership interest (as percent)												61.00%
Joint Venture \| The Industrial Fund REIT LLC
Real Estate Properties [Line Items]
Ownership interest (as percent)												22.00%
Hawaii
Real Estate Properties [Line Items]
Rentable square feet (in sqft) \| ft²									16,729
Number of buildings, leasable land parcels easements \| building										226
Other States
Real Estate Properties [Line Items]
Number of properties owned \| property								187
Rentable square feet (in sqft) \| ft²									43,254
Number of states where real estate is located \| state											38
Everett, WA \| Land \| Disposal Group, Disposed of by Sale, Not Discontinued Operations
Real Estate Properties [Line Items]
Proceeds from sale of real estate		$ 270
Losses on sale of real estate		$ 974
Somerset, New Jersey \| Tenancy in Common \| Unrelated Third Party
Real Estate Properties [Line Items]
Rentable square feet (in sqft) \| ft²									64
Ownership interest (as percent)												67.00%
Number of properties \| property						1
Net income (loss) attributable to noncontrolling interest			$ 159	$ (29)	$ (42)	$ 74
Somerset, New Jersey \| Tenancy in Common \| Unrelated Third Party
Real Estate Properties [Line Items]
Noncontrolling interest, ownership percentage by noncontrolling owners												33.00%

Leases (Details) $ in Thousands	3 Months Ended		9 Months Ended
Leases (Details) $ in Thousands	Sep. 30, 2023 USD ($) property	Sep. 30, 2022 USD ($)	Sep. 30, 2023 USD ($) property	Sep. 30, 2022 USD ($)	Dec. 31, 2022 USD ($)
Lessor, Lease, Description [Line Items]
Straight line rental income	$ 3,414	$ 3,794	$ 10,531	$ 8,170
Certain variable payments	$ 19,310	16,664	$ 58,700	46,071
Number of properties subject to ground leases \| property	3		3
Lessee, number of properties under an operating lease \| property			1
Right-of-use asset	$ 4,757		$ 4,757		$ 5,084
Operating lease liability	4,837		4,837		$ 5,149
Sublease revenue	$ 12	$ 176	$ 141	$ 355
Sales Revenue, Net \| Geographic Concentration Risk \| Hawaii
Lessor, Lease, Description [Line Items]
Concentration risk	28.10%	26.80%	27.90%	30.60%
FedEx Corporation
Lessor, Lease, Description [Line Items]
Percentage of rentable square feet	6.70%	6.80%	6.70%	6.80%
Amazon.com, Inc
Lessor, Lease, Description [Line Items]
Percentage of rentable square feet	29.80%	29.60%	29.80%	29.60%

Indebtedness - Schedule of Outstanding Indebtedness (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2023 USD ($) property	Dec. 31, 2022 USD ($)	Sep. 30, 2022 USD ($)
Debt Instrument [Line Items]
Total principal balance	$ 4,330,370	$ 4,290,363
Unamortized debt issuance costs	(26,739)		$ (45,862)
Total indebtedness, net	$ 4,303,631		$ 4,244,501
Interest rate (as a percent)	5.47%
Net book value of collateral	$ 4,763,350	4,857,352
Fixed rate loan, 3.67% interest rate, due in 2031
Debt Instrument [Line Items]
Interest rate (as a percent)	3.67%
Fixed rate loan, 4.02% interest rate, due in 2033
Debt Instrument [Line Items]
Interest rate (as a percent)	4.02%
Fixed rate loan, 4.13% interest rate, due in 2033
Debt Instrument [Line Items]
Interest rate (as a percent)	4.13%
Fixed rate loan, 3.10% interest rate, due in 2035
Debt Instrument [Line Items]
Interest rate (as a percent)	3.10%
Fixed rate loan, 2.95% interest rate, due in 2036
Debt Instrument [Line Items]
Interest rate (as a percent)	2.95%
Fixed rate loan, 4.27% interest rate, due in 2037
Debt Instrument [Line Items]
Interest rate (as a percent)	4.27%
Fixed rate loan, 3.25% interest rate, due in 2038
Debt Instrument [Line Items]
Interest rate (as a percent)	3.25%
Fixed rate loan, 3.76% interest rate, due in 2028
Debt Instrument [Line Items]
Interest rate (as a percent)	3.76%
Fixed rate loan, 3.77% interest rate, due in 2030
Debt Instrument [Line Items]
Interest rate (as a percent)	3.77%
Fixed rate loan, 3.85% interest rate, due in 2030
Debt Instrument [Line Items]
Interest rate (as a percent)	3.85%
Fixed rate loan, 3.56% interest rate, due in 2030
Debt Instrument [Line Items]
Interest rate (as a percent)	3.56%
Floating Rate Loan
Debt Instrument [Line Items]
Total indebtedness, net	$ 1,400,000
Floating Rate Loan \| Floating Rate Loan, 6.18%, due in 2024
Debt Instrument [Line Items]
Number of properties used as collateral \| property	104
Total principal balance	$ 1,235,000	1,235,000
Interest rate (as a percent)	6.18%
Net book value of collateral	$ 1,049,983	1,071,815
Floating Rate Loan \| Floating Rate Loan, 6.17%, due in 2024
Debt Instrument [Line Items]
Number of properties used as collateral \| property	82
Total principal balance	$ 1,400,000	1,400,000
Interest rate (as a percent)	6.17%
Net book value of collateral	$ 1,870,541	1,909,185
Fixed Rate Loan \| Fixed Rate Loan, 4.31%, due in 2029
Debt Instrument [Line Items]
Number of properties used as collateral \| property	186
Total principal balance	$ 650,000	650,000
Interest rate (as a percent)	4.31%
Net book value of collateral	$ 489,901	490,416
Fixed Rate Loan \| Fixed Rate Loan, 4.42%, due in 2032
Debt Instrument [Line Items]
Number of properties used as collateral \| property	17
Total principal balance	$ 700,000	700,000
Interest rate (as a percent)	4.42%
Net book value of collateral	$ 508,383	518,806
Fixed Rate Loan \| Fixed rate loan, 6.25% due in 2030
Debt Instrument [Line Items]
Number of properties used as collateral \| property	4
Total principal balance	$ 91,000	0
Interest rate (as a percent)	6.25%
Net book value of collateral	$ 184,375	0
Fixed Rate Loan \| Fixed rate loan, 3.67% interest rate, due in 2031
Debt Instrument [Line Items]
Number of properties used as collateral \| property	1
Total principal balance	$ 11,712	12,691
Interest rate (as a percent)	3.67%
Net book value of collateral	$ 29,094	30,800
Fixed Rate Loan \| Fixed Rate Loan, 4.14%, due in 2032
Debt Instrument [Line Items]
Number of properties used as collateral \| property	1
Total principal balance	$ 13,228	14,144
Interest rate (as a percent)	4.14%
Net book value of collateral	$ 43,826	44,777
Fixed Rate Loan \| Fixed rate loan, 4.02% interest rate, due in 2033
Debt Instrument [Line Items]
Number of properties used as collateral \| property	1
Total principal balance	$ 29,213	30,949
Interest rate (as a percent)	4.02%
Net book value of collateral	$ 85,380	87,143
Fixed Rate Loan \| Fixed rate loan, 4.13% interest rate, due in 2033
Debt Instrument [Line Items]
Number of properties used as collateral \| property	1
Total principal balance	$ 40,832	43,219
Interest rate (as a percent)	4.13%
Net book value of collateral	$ 130,197	131,539
Fixed Rate Loan \| Fixed rate loan, 3.10% interest rate, due in 2035
Debt Instrument [Line Items]
Number of properties used as collateral \| property	1
Total principal balance	$ 24,873	26,175
Interest rate (as a percent)	3.10%
Net book value of collateral	$ 46,725	47,718
Fixed Rate Loan \| Fixed rate loan, 2.95% interest rate, due in 2036
Debt Instrument [Line Items]
Number of properties used as collateral \| property	1
Total principal balance	$ 40,087	42,087
Interest rate (as a percent)	2.95%
Net book value of collateral	$ 99,805	101,896
Fixed Rate Loan \| Fixed rate loan, 4.27% interest rate, due in 2037
Debt Instrument [Line Items]
Number of properties used as collateral \| property	1
Total principal balance	$ 44,423	46,109
Interest rate (as a percent)	4.27%
Net book value of collateral	$ 110,881	113,063
Fixed Rate Loan \| Fixed rate loan, 3.25% interest rate, due in 2038
Debt Instrument [Line Items]
Number of properties used as collateral \| property	1
Total principal balance	$ 50,002	52,031
Interest rate (as a percent)	3.25%
Net book value of collateral	$ 114,259	116,607
Fixed Rate Loan \| Fixed rate loan, 3.76% interest rate, due in 2028
Debt Instrument [Line Items]
Number of properties used as collateral \| property	1
Total principal balance	$ 0	13,556
Net book value of collateral	$ 0	63,314
Fixed Rate Loan \| Fixed rate loan, 3.77% interest rate, due in 2030
Debt Instrument [Line Items]
Number of properties used as collateral \| property	1
Total principal balance	$ 0	4,865
Net book value of collateral	$ 0	39,724
Fixed Rate Loan \| Fixed rate loan, 3.85% interest rate, due in 2030
Debt Instrument [Line Items]
Number of properties used as collateral \| property	1
Total principal balance	$ 0	5,145
Net book value of collateral	$ 0	39,724
Fixed Rate Loan \| Fixed rate loan, 3.56% interest rate, due in 2030
Debt Instrument [Line Items]
Number of properties used as collateral \| property	1
Total principal balance	$ 0	14,392
Net book value of collateral	$ 0	$ 50,825

Indebtedness - Narrative (Details) $ in Thousands	1 Months Ended	3 Months Ended		9 Months Ended
Indebtedness - Narrative (Details) $ in Thousands	May 31, 2023 USD ($) mortgage property	Sep. 30, 2023 USD ($)	Sep. 30, 2022 USD ($)	Sep. 30, 2023 USD ($) property option	Sep. 30, 2022 USD ($)	Dec. 31, 2022 USD ($)
Debt Instrument [Line Items]
Debt outstanding		$ 4,303,631	$ 4,244,501	$ 4,303,631	$ 4,244,501
Number of outstanding mortgage loans \| mortgage	4
Aggregate outstanding principal balance		4,330,370		4,330,370		$ 4,290,363
Loss on extinguishment of debt		$ 0	$ 21,370	$ 359	$ 22,198
Interest Rate Swap \| Cash Flow Hedging \| Designated as Hedging Instrument
Debt Instrument [Line Items]
Derivative, interest rate cap (as a percent)			2.70%		2.70%
Floating Rate Loan, 6.17%, due in 2024
Debt Instrument [Line Items]
Weighted average interest rate (as a percent)		4.94%		4.23%
ILPT Floating Rate Loan \| Interest Rate Swap \| Cash Flow Hedging \| Designated as Hedging Instrument
Debt Instrument [Line Items]
Derivative, interest rate cap (as a percent)		2.25%		2.25%
ILPT Floating Rate Loan \| Secured Overnight Financing Rate (SOFR) \| Interest Rate Swap \| Cash Flow Hedging \| Designated as Hedging Instrument
Debt Instrument [Line Items]
Derivative, interest rate cap (as a percent)		2.25%		2.25%
Floating Rate Loan \| Interest Rate Swap \| Cash Flow Hedging \| Designated as Hedging Instrument
Debt Instrument [Line Items]
Derivative, interest rate cap (as a percent)		3.40%		3.40%
Floating Rate Loan \| Secured Overnight Financing Rate (SOFR) \| Interest Rate Swap \| Cash Flow Hedging \| Designated as Hedging Instrument
Debt Instrument [Line Items]
Derivative, interest rate cap (as a percent)		3.40%		3.40%
ILPT Floating Rate Loan \| Floating Rate Loan, 6.18%, due in 2024
Debt Instrument [Line Items]
Debt outstanding		$ 1,235,000		$ 1,235,000
Number of options to extend maturity date \| option				3
Extension period				1 year
Weighted average interest rate (as a percent)		6.18%		6.18%
ILPT Floating Rate Loan \| Floating Rate Loan, 6.18%, due in 2024 \| Secured Overnight Financing Rate (SOFR)
Debt Instrument [Line Items]
Basis spread on variable rate (as a percent)				3.93%
Floating Rate Loan
Debt Instrument [Line Items]
Debt outstanding		$ 1,400,000		$ 1,400,000
Floating Rate Loan \| Floating Rate Loan, 6.18%, due in 2024
Debt Instrument [Line Items]
Number of properties used as collateral \| property				104
Aggregate outstanding principal balance		$ 1,235,000		$ 1,235,000		1,235,000
Floating Rate Loan \| Floating Rate Loan, 6.17%, due in 2024
Debt Instrument [Line Items]
Number of options to extend maturity date \| option				3
Extension period				1 year
Weighted average interest rate (as a percent)		6.17%		6.17%
Prepayment terms without premium amount		$ 280,000		$ 280,000
Number of properties used as collateral \| property				82
Aggregate outstanding principal balance		$ 1,400,000		$ 1,400,000		$ 1,400,000
Floating Rate Loan \| Floating Rate Loan, 6.17%, due in 2024 \| Secured Overnight Financing Rate (SOFR)
Debt Instrument [Line Items]
Basis spread on variable rate (as a percent)				2.77%
Mortgage Note Payable \| Fixed Rate Loan, 6.25%, Due in 2030 \| Joint Venture
Debt Instrument [Line Items]
Debt instrument, face amount	$ 91,000
Number of properties used as collateral \| property	4
Annual interest rate (as a percent)	6.25%
Aggregate outstanding principal balance	$ 35,910
Weighted average interest rate (as a percent)	3.70%
Loss on extinguishment of debt				$ 359

Fair Value of Assets and Liabilities - Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Fair Value of Financial Instruments
Interest rate (as a percent)	5.47%
Fixed rate loan	$ 4,303,631	$ 4,244,501
Unamortized premiums	$ 8,751	8,628
Fixed rate loan, 4.31% interest rate, due in 2029
Fair Value of Financial Instruments
Interest rate (as a percent)	4.31%
Fixed rate loan, 6.25% interest rate, due in 2030
Fair Value of Financial Instruments
Interest rate (as a percent)	6.25%
Fixed rate loan, 3.67% interest rate, due in 2031
Fair Value of Financial Instruments
Interest rate (as a percent)	3.67%
Fixed rate loan, 4.42% interest rate, due in 2032
Fair Value of Financial Instruments
Interest rate (as a percent)	4.42%
Fixed rate loan, 4.14% interest rate, due in 2032
Fair Value of Financial Instruments
Interest rate (as a percent)	4.14%
Fixed rate loan, 4.02% interest rate, due in 2033
Fair Value of Financial Instruments
Interest rate (as a percent)	4.02%
Fixed rate loan, 4.13% interest rate, due in 2033
Fair Value of Financial Instruments
Interest rate (as a percent)	4.13%
Fixed rate loan, 3.10% interest rate, due in 2035
Fair Value of Financial Instruments
Interest rate (as a percent)	3.10%
Fixed rate loan, 2.95% interest rate, due in 2036
Fair Value of Financial Instruments
Interest rate (as a percent)	2.95%
Fixed rate loan, 4.27% interest rate, due in 2037
Fair Value of Financial Instruments
Interest rate (as a percent)	4.27%
Fixed rate loan, 3.25% interest rate, due in 2038
Fair Value of Financial Instruments
Interest rate (as a percent)	3.25%
Fixed rate loan, 3.76% interest rate, due in 2028
Fair Value of Financial Instruments
Interest rate (as a percent)	3.76%
Fixed rate loan, 3.77% interest rate, due in 2030
Fair Value of Financial Instruments
Interest rate (as a percent)	3.77%
Fixed rate loan, 3.85% interest rate, due in 2030
Fair Value of Financial Instruments
Interest rate (as a percent)	3.85%
Fixed rate loan, 3.56% interest rate, due in 2030
Fair Value of Financial Instruments
Interest rate (as a percent)	3.56%
Carrying Amount
Fair Value of Financial Instruments
Long-term debt	$ 1,686,618	1,646,736
Carrying Amount \| Fixed rate loan, 4.31% interest rate, due in 2029
Fair Value of Financial Instruments
Fixed rate loan	647,077	646,669
Carrying Amount \| Fixed rate loan, 6.25% interest rate, due in 2030
Fair Value of Financial Instruments
Fixed rate loan	90,038	0
Carrying Amount \| Fixed rate loan, 3.67% interest rate, due in 2031
Fair Value of Financial Instruments
Fixed rate loan	11,712	12,691
Carrying Amount \| Fixed rate loan, 4.42% interest rate, due in 2032
Fair Value of Financial Instruments
Fixed rate loan	695,134	694,704
Carrying Amount \| Fixed rate loan, 4.14% interest rate, due in 2032
Fair Value of Financial Instruments
Fixed rate loan	13,228	14,144
Carrying Amount \| Fixed rate loan, 4.02% interest rate, due in 2033
Fair Value of Financial Instruments
Fixed rate loan	29,213	30,949
Carrying Amount \| Fixed rate loan, 4.13% interest rate, due in 2033
Fair Value of Financial Instruments
Fixed rate loan	40,832	43,219
Carrying Amount \| Fixed rate loan, 3.10% interest rate, due in 2035
Fair Value of Financial Instruments
Fixed rate loan	24,873	26,175
Carrying Amount \| Fixed rate loan, 2.95% interest rate, due in 2036
Fair Value of Financial Instruments
Fixed rate loan	40,087	42,087
Carrying Amount \| Fixed rate loan, 4.27% interest rate, due in 2037
Fair Value of Financial Instruments
Fixed rate loan	44,423	46,109
Carrying Amount \| Fixed rate loan, 3.25% interest rate, due in 2038
Fair Value of Financial Instruments
Fixed rate loan	50,001	52,031
Carrying Amount \| Fixed rate loan, 3.76% interest rate, due in 2028
Fair Value of Financial Instruments
Fixed rate loan	0	13,556
Carrying Amount \| Fixed rate loan, 3.77% interest rate, due in 2030
Fair Value of Financial Instruments
Fixed rate loan	0	4,865
Carrying Amount \| Fixed rate loan, 3.85% interest rate, due in 2030
Fair Value of Financial Instruments
Fixed rate loan	0	5,145
Carrying Amount \| Fixed rate loan, 3.56% interest rate, due in 2030
Fair Value of Financial Instruments
Fixed rate loan	0	14,392
Estimated Fair Value
Fair Value of Financial Instruments
Long-term debt	1,548,147	1,487,147
Estimated Fair Value \| Fixed rate loan, 4.31% interest rate, due in 2029
Fair Value of Financial Instruments
Fixed rate loan	613,520	592,295
Estimated Fair Value \| Fixed rate loan, 6.25% interest rate, due in 2030
Fair Value of Financial Instruments
Fixed rate loan	94,438	0
Estimated Fair Value \| Fixed rate loan, 3.67% interest rate, due in 2031
Fair Value of Financial Instruments
Fixed rate loan	11,009	11,713
Estimated Fair Value \| Fixed rate loan, 4.42% interest rate, due in 2032
Fair Value of Financial Instruments
Fixed rate loan	609,714	623,133
Estimated Fair Value \| Fixed rate loan, 4.14% interest rate, due in 2032
Fair Value of Financial Instruments
Fixed rate loan	12,611	13,182
Estimated Fair Value \| Fixed rate loan, 4.02% interest rate, due in 2033
Fair Value of Financial Instruments
Fixed rate loan	27,185	28,195
Estimated Fair Value \| Fixed rate loan, 4.13% interest rate, due in 2033
Fair Value of Financial Instruments
Fixed rate loan	38,181	39,573
Estimated Fair Value \| Fixed rate loan, 3.10% interest rate, due in 2035
Fair Value of Financial Instruments
Fixed rate loan	21,837	22,373
Estimated Fair Value \| Fixed rate loan, 2.95% interest rate, due in 2036
Fair Value of Financial Instruments
Fixed rate loan	34,723	35,444
Estimated Fair Value \| Fixed rate loan, 4.27% interest rate, due in 2037
Fair Value of Financial Instruments
Fixed rate loan	41,466	41,880
Estimated Fair Value \| Fixed rate loan, 3.25% interest rate, due in 2038
Fair Value of Financial Instruments
Fixed rate loan	43,463	43,878
Estimated Fair Value \| Fixed rate loan, 3.76% interest rate, due in 2028
Fair Value of Financial Instruments
Fixed rate loan	0	12,784
Estimated Fair Value \| Fixed rate loan, 3.77% interest rate, due in 2030
Fair Value of Financial Instruments
Fixed rate loan	0	4,553
Estimated Fair Value \| Fixed rate loan, 3.85% interest rate, due in 2030
Fair Value of Financial Instruments
Fixed rate loan	0	4,829
Estimated Fair Value \| Fixed rate loan, 3.56% interest rate, due in 2030
Fair Value of Financial Instruments
Fixed rate loan	$ 0	$ 13,315

Fair Value of Assets and Liabilities - Assets Measured on Recurring Basis (Details) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2023 USD ($) property	Dec. 31, 2022 USD ($) property
Fair Value of Financial Instruments
Real estate properties	$ 4,765,820	$ 4,902,641
Fair Value, Recurring
Fair Value of Financial Instruments
Investment in unconsolidated joint venture	124,411	124,358
Interest rate cap derivatives	51,322	73,133
Fair Value, Recurring \| Fair Value, Inputs, Level 1
Fair Value of Financial Instruments
Investment in unconsolidated joint venture	0	0
Interest rate cap derivatives	0	0
Fair Value, Recurring \| Fair Value, Inputs, Level 2
Fair Value of Financial Instruments
Investment in unconsolidated joint venture	0	0
Interest rate cap derivatives	51,322	73,133
Fair Value, Recurring \| Fair Value, Inputs, Level 3
Fair Value of Financial Instruments
Investment in unconsolidated joint venture	124,411	124,358
Interest rate cap derivatives	0	0
Fair Value, Nonrecurring
Fair Value of Financial Instruments
Real estate properties	1,414	555,123
Fair Value, Nonrecurring \| Fair Value, Inputs, Level 1
Fair Value of Financial Instruments
Real estate properties	0	0
Fair Value, Nonrecurring \| Fair Value, Inputs, Level 2
Fair Value of Financial Instruments
Real estate properties	0	0
Fair Value, Nonrecurring \| Fair Value, Inputs, Level 3
Fair Value of Financial Instruments
Real estate properties	$ 1,414	$ 555,123
Number of properties impaired \| property	1	25

Fair Value of Assets and Liabilities - Fair Value Measurements Significant Unobservable Inputs Related to Certain Level 3 (Details) - Fair Value, Inputs, Level 3	Sep. 30, 2023	Dec. 31, 2022
Measurement Input, Discount Rate \| Minimum
Fair Value, Option, Quantitative Disclosures [Line Items]
Investment in unconsolidated joint venture	0.0525	0.0525
Measurement Input, Discount Rate \| Maximum
Fair Value, Option, Quantitative Disclosures [Line Items]
Investment in unconsolidated joint venture	0.0700	0.0700
Measurement Input, Exit Capitalization Rate \| Minimum
Fair Value, Option, Quantitative Disclosures [Line Items]
Investment in unconsolidated joint venture	0.0495	0.0475
Measurement Input, Exit Capitalization Rate \| Maximum
Fair Value, Option, Quantitative Disclosures [Line Items]
Investment in unconsolidated joint venture	0.0600	0.0600
Measurement Input, Holdings Periods
Fair Value, Option, Quantitative Disclosures [Line Items]
Investment in unconsolidated joint venture, holding periods		10 years
Measurement Input, Holdings Periods \| Minimum
Fair Value, Option, Quantitative Disclosures [Line Items]
Investment in unconsolidated joint venture, holding periods	10 years
Measurement Input, Holdings Periods \| Maximum
Fair Value, Option, Quantitative Disclosures [Line Items]
Investment in unconsolidated joint venture, holding periods	12 years

Fair Value of Assets and Liabilities - Changes In Fair Value For Our Investment In Unconsolidated Joint Venture (Details) - Equity Method Investments - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning balance	$ 129,082	$ 143,716	$ 124,358	$ 143,021
Equity in earnings of unconsolidated joint venture	719	3,297	7,423	6,634
Distributions from unconsolidated joint venture	(5,390)	(1,320)	(7,370)	(3,962)
Ending balance	$ 124,411	$ 145,693	$ 124,411	$ 145,693

Shareholders' Equity - Narrative (Details) $ / shares in Units, $ in Thousands				3 Months Ended	9 Months Ended
	Oct. 12, 2023 USD ($) $ / shares	Sep. 13, 2023 USD ($) $ / shares	Jun. 01, 2023 trustee $ / shares shares	Sep. 30, 2023 $ / shares shares	Sep. 30, 2023 $ / shares shares
Shareholders' Equity
Number of officers \| trustee			7
Subsequent Event
Shareholders' Equity
Common distributions declared (in dollars per share)	$ 0.01
Dividends payable \| $	$ 658
Common Stock
Shareholders' Equity
Share repurchases to pay for tax withholding (in shares) \| shares				40,636	48,722
Common Stock \| Minimum
Shareholders' Equity
Share price (in dollars per share)				$ 3.54	$ 3.54
Common Stock \| Maximum
Shareholders' Equity
Share price (in dollars per share)				$ 3.29	$ 3.29
Trustee
Shareholders' Equity
Common shares granted (in shares) \| shares			20,000
Common share price (in dollars per share)			$ 1.78
Officer
Shareholders' Equity
Common share price (in dollars per share)		$ 3.63
Common share forfeiture (in shares) \| $		$ 188,350

Shareholders' Equity - Schedule of Distributions Declared and Paid (Details) - USD ($) $ / shares in Units, $ in Thousands				3 Months Ended						9 Months Ended
	Aug. 17, 2023	May 18, 2023	Feb. 16, 2023	Sep. 30, 2023	Jun. 30, 2023	Mar. 31, 2023	Sep. 30, 2022	Jun. 30, 2022	Mar. 31, 2022	Sep. 30, 2023
Equity [Abstract]
Dividends paid (in dollars per share)	$ 0.01	$ 0.01	$ 0.01							$ 0.03
Total Distribution	$ 656	$ 656	$ 656	$ 656	$ 656	$ 656	$ 654	$ 21,583	$ 21,584	$ 1,968

Business and Property Management Agreements with RMR (Details)	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2023 USD ($) employee agreement	Sep. 30, 2022 USD ($)	Sep. 30, 2023 USD ($) employee agreement	Sep. 30, 2022 USD ($)	Dec. 31, 2022 USD ($)
Related Party Transaction [Line Items]
Number of employees \| employee	0		0
Other operating expenses	$ 9,907,000	$ 8,453,000	$ 27,744,000	$ 22,278,000
Property Management and Construction Supervision Fees
Related Party Transaction [Line Items]
Related party transaction, amount	3,464,000	3,270,000	10,286,000	8,797,000
Capitalized Property Management and Construction Supervision Fees
Related Party Transaction [Line Items]
Related party transaction, amount	171,000	294,000	541,000	693,000
Reimbursed Property Level Operating Expenses
Related Party Transaction [Line Items]
Related party transaction, amount	$ 2,375,000	1,847,000	$ 6,216,000	5,155,000
Related Party
Related Party Transaction [Line Items]
Number of management service agreements \| agreement	2		2
Management fee expense	$ 5,919,000	6,465,000	$ 17,301,000	17,821,000
Incentive fee expense	$ 0	0	$ 0	0	$ 0
Management service agreement term			3 years
Number of joint venture agreements \| agreement	2		2
Related Party \| Reit Management And Research L L C
Related Party Transaction [Line Items]
Number of management service agreements \| agreement	2		2
Related Party \| Expensed Property Management and Construction Supervision Fees
Related Party Transaction [Line Items]
Other operating expenses	$ 3,293,000	$ 2,976,000	$ 9,745,000	$ 8,104,000

Related Person Transactions (Details) $ in Thousands	Sep. 30, 2023 USD ($) agreement	Dec. 31, 2022 USD ($)
Related Party
Related Party Transaction [Line Items]
Number of management service agreements	2
Number of joint venture agreements	2
Accounts payable and other liabilities \| $	$ 5,896	$ 4,824
Joint Venture
Related Party Transaction [Line Items]
Number of joint venture agreements	2
Accounts payable and other liabilities \| $	$ 613	$ 616

Derivatives and Hedging Activities - Schedule of Interest Rate Cap Agreements (Details) - Interest Rate Swap - Cash Flow Hedging - Designated as Hedging Instrument - USD ($)	Sep. 30, 2023	Dec. 31, 2022	Sep. 30, 2022
Derivative Instruments, Gain (Loss) [Line Items]
Strike rate			2.70%
Amount			$ 1,385,158,000
Fair value	$ 51,322,000	$ 73,133,000	$ 7,740,000
Floating Rate Loan
Derivative Instruments, Gain (Loss) [Line Items]
Strike rate	3.40%
Amount	$ 1,400,000,000
Fair value	$ 12,712,000	23,337,000
ILPT Floating Rate Loan
Derivative Instruments, Gain (Loss) [Line Items]
Strike rate	2.25%
Amount	$ 1,235,000,000
Fair value	$ 38,610,000	$ 49,796,000

Derivatives and Hedging Activities - Narrative (Details)	1 Months Ended
	Sep. 30, 2022 USD ($) property derivative_instrument	Sep. 30, 2023 USD ($)	Dec. 31, 2022 USD ($)
Derivative Instruments, Gain (Loss) [Line Items]
Debt outstanding	$ 4,244,501,000	$ 4,303,631,000
Bridge Loan
Derivative Instruments, Gain (Loss) [Line Items]
Debt outstanding	$ 1,385,158,000
Number of properties used as collateral \| property	109
Interest Rate Swap \| Cash Flow Hedging \| Designated as Hedging Instrument
Derivative Instruments, Gain (Loss) [Line Items]
Number of Instruments \| derivative_instrument	2
Amount	$ 1,385,158,000
Derivative, interest rate cap (as a percent)	2.70%
Derivative instruments in hedges, at fair value, net	$ 7,740,000	$ 51,322,000	$ 73,133,000

Derivatives and Hedging Activities - Schedule of Activity (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain recognized in cumulative other comprehensive income	$ 3,428	$ 15,047	$ 19,677	$ 24,200
Unrealized (loss) gain on derivative instrument recognized in cumulative other comprehensive loss	(6,635)	8,847	(3,392)	18,917
Loss on Early Extinguishment
Derivative Instruments, Gain (Loss) [Line Items]
Amount reclassified from cumulative other comprehensive income	(10,063)	761	(23,069)	1,678
Interest Expense
Derivative Instruments, Gain (Loss) [Line Items]
Amount reclassified from cumulative other comprehensive income	$ 0	$ (6,961)	$ 0	$ (6,961)

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