FRANKLIN STREET PROPERTIES CORP /MA/

Previous wording

The following discussion should be read in conjunction with the financial statements and notes thereto appearing elsewhere in this report and in our Annual Report on Form 10-K for the year ended December 31, 2025. Historical results and percentage relationships set forth in the consolidated financial statements, including trends which might appear, should not be taken as necessarily indicative of future operations. The following discussion and other parts of this Quarterly Report on Form 10-Q may also contain forward-looking statements based on current judgments and current knowledge of management, which are subject to certain risks, trends and uncertainties that could cause actual results to differ materially from those indicated in such forward-looking statements. Accordingly, readers are cautioned not to place undue reliance on forward-looking statements. Investors are cautioned that our forward-looking statements involve risks and uncertainty, including without limitation, adverse changes in general economic or local market conditions, including as a result of the long-term effects of the COVID-19 pandemic, wars, terrorist attacks or other acts of violence, which may negatively affect the markets in which we and our tenants operate, impacts of changes in tariffs that the United States and other countries have announced or implemented, as well as any additional new tariffs, trade restrictions or export regulations that may be implemented or reversed in the future, inflation rates, interest rates, disruptions in the debt markets, economic conditions in the markets in which we own properties, risks of a lessening of demand for the types of real estate owned by us, adverse changes in energy prices, which if sustained, could negatively impact occupancy and rental rates in the markets in which we own properties, including energy-influenced markets such as Dallas, Denver and Houston, expectations for future potential property dispositions, expectations for future potential leasing activity, changes in government regulations and regulatory uncertainty, uncertainty about governmental fiscal policy, geopolitical events and expenditures that cannot be anticipated, such as utility rate and usage increases, delays in construction schedules, unanticipated increases in construction costs, unanticipated repairs, increases in the level of general and administrative costs as a percentage of revenues as revenues decrease as a result of property dispositions, additional staffing, insurance increases and real estate tax valuation reassessments. See Part I, Item 1A. “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025. Although we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. We may not update any of the forward-looking statements after the date this Quarterly Report on Form 10-Q is filed to conform them to ac…

Excerpt shortened here; the source contains the full paragraph.

Current wording

The following discussion should be read in conjunction with the financial statements and notes thereto appearing elsewhere in this report and in our Annual Report on Form 10-K for the year ended December 31, 2025. Historical results and percentage relationships set forth in the consolidated financial statements, including trends which might appear, should not be taken as necessarily indicative of future operations. The following discussion and other parts of this Quarterly Report on Form 10-Q may also contain forward-looking statements based on current judgments and current knowledge of management, which are subject to certain risks, trends and uncertainties that could cause actual results to differ materially from those indicated in such forward-looking statements. Accordingly, readers are cautioned not to place undue reliance on forward-looking statements. Investors are cautioned that our forward-looking statements involve risks and uncertainty, including without limitation, adverse changes in general economic or local market conditions, including as a result of the long-term effects of the COVID-19 pandemic, wars, terrorist attacks or other acts of violence, which may negatively affect the markets in which we and our tenants operate, impacts of changes in tariffs that the United States and other countries have announced or implemented, as well as any additional new tariffs, trade restrictions or export regulations that may be implemented or reversed in the future, inflation rates, interest rates, disruptions in the debt markets, economic conditions in the markets in which we own properties, risks of a lessening of demand for the types of real estate owned by us, adverse changes in energy prices, which if sustained, could negatively impact occupancy and rental rates in the markets in which we own properties, including energy-influenced markets such as Dallas, Denver and Houston, expectations for future potential property dispositions, which we may be unable to effect at acceptable terms and conditions, and if we are able to engage in such transactions, the timing thereof, expectations for future potential leasing activity, which are based on current judgments and current knowledge of management and with respect to which actual results may differ materially from such expectations, changes in government regulations and regulatory uncertainty, uncertainty about governmental fiscal policy, geopolitical events and expenditures that cannot be anticipated, such as utility rate and usage increases, delays in construction schedules, unanticipated increases in construction costs, unanticipated repairs, increases in the level of general and administrative costs as a percentage of revenues as revenues decrease as a result of property dispositions, additional staffing, insurance increases and real estate tax valuation reassessments. See Part I, Item 1A. “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025. Although we believ…

Excerpt shortened here; the source contains the full paragraph.

Previous wording

FSP Corp., or we or the Company, operates in a single reportable segment: real estate operations. The real estate operations market involves real estate rental operations, leasing, secured financing of real estate and services provided for asset management, property management, property acquisitions, dispositions and development. Our current strategy is to focus on infill and central business district office properties in the United States sunbelt and mountain west regions as well as select opportunistic markets. We believe that the United States sunbelt and mountain west regions have macro-economic drivers that have the potential to increase occupancies and rents. We are focused on long-term growth and appreciation.

Current wording

FSP Corp., or we or the Company, operates in a single reportable segment: real estate operations. The real estate operations market involves real estate rental operations, leasing, secured financing of real estate and services provided for asset management, property management, property acquisitions, dispositions and development. Our current strategy is to focus on infill and central business district office properties in the United States southwest and mountain west regions as well as select opportunistic markets. We believe that the United States southwest and mountain west regions have macro-economic drivers that have the potential to increase occupancies and rents. We are focused on long-term growth and appreciation.

Previous wording

As of June 30, 2026, all of our total owned portfolio, consisting of approximately 4.8 million square feet, was located in Dallas, Denver, Houston and Minneapolis.

Current wording

As of September 30, 2026, all of our total owned portfolio, consisting of approximately 4.6 million square feet, was located in Dallas, Denver, Houston and Minneapolis.

Previous wording

our option, subject to certain conditions. The facility includes up to $45 million of delayed draw term loans which, subject to certain conditions, may be used to fund tenant improvements, leasing commissions, building improvements and other uses approved by the lenders. See Note 2, Term Loans Payable and Senior Notes, of the Notes to Consolidated Financial Statements contained in Part I, Item 1 of this Quarterly Report on Form 10-Q for further information on the Credit Agreement.

Current wording

On February 26, 2026, we closed a $320 million secured credit facility with an affiliate of TPG Credit. We repaid in full all of our then outstanding approximately $249 million aggregate principal amount of indebtedness with borrowings under the facility. The facility has an original stated maturity of February 26, 2029, subject to potential extension of up to one year at our option, subject to certain conditions. The facility includes up to $45 million of delayed draw term loans which, subject to certain conditions, may be used to fund tenant improvements, leasing commissions, building improvements and other uses approved by the lenders. See Note 2, Term Loans Payable and Senior Notes, of the Notes to Consolidated Financial Statements contained in Part I, Item 1 of this Quarterly Report on Form 10-Q for further information on the Credit Agreement.

Previous wording

In April 2026, we announced that our Board of Directors had expanded its ongoing review of strategic alternatives to include BofA Securities, Inc. and Jones Lang LaSalle Securities, LLC as co-financial advisors. We believe that our co-financial advisors bring complementary capabilities across capital markets, mergers and acquisitions, and asset level execution, positioning us to evaluate a broad range of potential transactions with the objective of maximizing shareholder value.

Current wording

In April 2026, we announced that our Board of Directors had expanded its ongoing review of strategic alternatives to include BofA Securities, Inc. and Jones Lang LaSalle Securities, LLC as financial co-advisors. We believe that our financial co-advisors bring complementary capabilities across capital markets, mergers and acquisitions, and asset level execution, positioning us to evaluate a broad range of potential transactions with the objective of maximizing shareholder value.

Previous wording

We continue to prioritize leasing and occupancy improvement across our portfolio and have seen an increased number of larger prospective leasing opportunities across our markets. We also continue to focus on driving efficiencies across our platform, including the management of general and administrative expenses. We believe that the combination of an expanded and active strategic review process, disciplined execution, and continued leasing progress will provide the best path to maximizing value for our shareholders.

Current wording

We also continue to prioritize leasing and occupancy improvement across our portfolio and have seen an increased number of larger prospective leasing opportunities across our markets. These efforts remain important because changes in occupancy, lease duration, capital requirements and tenant quality can materially affect the value and marketability of individual assets.

Previous wording

Uncertainty still surrounds the long-term impact of the COVID-19 pandemic on the commercial real estate market and our business. Many of our tenants still do not fully occupy the space that they lease. The impact of the COVID-19 pandemic continues to present material uncertainty and risk with respect to the performance of our properties and our financial results, such as the potential negative impact to the businesses of our tenants, the impact of work-from-home and return-to-work policies, the potential negative impact to leasing efforts and occupancy at our properties, uncertainty regarding future rent collection levels or requests for rent concessions from our tenants, the occurrence of a default under any of our debt agreements, the potential for increased borrowing costs, negative impacts on our ability to refinance existing indebtedness or to secure new sources of capital on favorable terms, decreases in values of our real estate assets, and uncertainty regarding government and regulatory policy. We are unable to estimate the full extent of the long-term impact that the COVID-19 pandemic has had and will have on our future financial results at this time. See “The long-term impact of the COVID-19 pandemic has had and may continue to have an adverse impact on our financial condition and results of operations. This impact could be materially adverse to the extent that the long-term impact of the COVID-19 pandemic, or future pandemics, cause tenants to be unable to pay their rent or reduce the demand for commercial real estate, or cause other impacts described below.” in Part I, Item 1A. “Risk Factors ” in our Annual Report on Form 10-K for the year ended December 31, 2025.

Current wording

policies, the potential negative impact to leasing efforts and occupancy at our properties, uncertainty regarding future rent collection levels or requests for rent concessions from our tenants, the occurrence of a default under any of our debt agreements, the potential for increased borrowing costs, negative impacts on our ability to refinance existing indebtedness or to secure new sources of capital on favorable terms, decreases in values of our real estate assets, and uncertainty regarding government and regulatory policy. We are unable to estimate the full extent of the long-term impact that the COVID-19 pandemic has had and will have on our future financial results at this time. See “The long-term impact of the COVID-19 pandemic has had and may continue to have an adverse impact on our financial condition and results of operations. This impact could be materially adverse to the extent that the long-term impact of the COVID-19 pandemic, or future pandemics, cause tenants to be unable to pay their rent or reduce the demand for commercial real estate, or cause other impacts described below.” in Part I, Item 1A. “Risk Factors ” in our Annual Report on Form 10-K for the year ended December 31, 2025.

Previous wording

The global economy continues to experience significant disruptions as a result of various factors, including changes in U.S. trade or other policies or those policies of other nations, geopolitical events such as the conflicts in Ukraine and the Middle East, including Iran, increasing tensions with China, tensions between the U.S. and Europe related to the sovereignty of Greenland, major political shifts domestically or internationally and continuing supply chain difficulties. In addition, various economic factors, including but not limited to, impacts of changes in tariffs that the United States and other countries have announced or implemented, as well as any additional new tariffs, trade restrictions or export regulations that may be implemented or reversed in the future, inflation and interest rates, may adversely affect the economy of the United States. Economic conditions directly affect the demand for office space, our primary income producing asset. In addition, the broad economic market conditions in the United States are typically affected by numerous other factors, including but not limited to, employment levels, energy prices, uncertainty about government fiscal, monetary, trade and tax policies, changes in currency exchange rates, the regulatory environment and the availability of credit. Increased interest rates could decrease the amount third parties are willing to pay for our assets and limit our ability to incur new debt or refinance existing debt when it matures. As of the date of this report, the impact of current economic conditions and geopolitical events and the long-term impact of the COVID-19 pandemic are adversely affecting the demand for office space in the United States.

Current wording

The global economy continues to experience significant disruptions as a result of various factors, including changes in U.S. trade or other policies or those policies of other nations, geopolitical events such as the conflicts in Ukraine and the Middle East, including Iran, increasing tensions with China, Europe and Canada, major political shifts domestically or internationally and continuing supply chain difficulties. In addition, various economic factors, including but not limited to, impacts of changes in tariffs that the United States and other countries have announced or implemented, as well as any additional new tariffs, trade restrictions or export regulations that may be implemented or reversed in the future, inflation and interest rates, may adversely affect the economy of the United States. Economic conditions directly affect the demand for office space, our primary income producing asset. In addition, the broad economic market conditions in the United States are typically affected by numerous other factors, including but not limited to, employment levels, energy prices, uncertainty about government fiscal, monetary, trade and tax policies, changes in currency exchange rates, the regulatory environment and the availability of credit. Increased interest rates could decrease the amount third parties are willing to pay for our assets and limit our ability to incur new debt or refinance existing debt when it matures. As of the date of this report, the impact of current economic conditions and geopolitical events and the long-term impact of the COVID-19 pandemic are adversely affecting the demand for office space in the United States.

Previous wording

As of June 30, 2026, our real estate portfolio was comprised of 14 owned properties, which we refer to as our owned properties. Our owned properties were approximately 67.4% leased as of June 30, 2026, a decrease from 68.9% leased as of December 31, 2025. The 1.5% decrease in leased space was primarily a result of lease expirations exceeding new executed leases during the six months ended June 30, 2026. As of June 30, 2026, we had approximately 1,569,000 square feet of vacancy in our owned properties compared to approximately 1,497,000 square feet of vacancy at December 31, 2025. During the six months ended June 30, 2026, we leased approximately 170,000 square feet of office space in our owned properties, of which approximately 120,000 square feet were with existing tenants, at a weighted average term of 6.3 years. On average, tenant improvements for such leases were $33.32 per square foot, lease commissions were $11.31 per square foot and rent concessions were approximately five months of free rent. Average GAAP base rents under such leases were $34.34 per square foot, or 7.4% higher than average rents in the respective properties as applicable compared to the year ended December 31, 2025.

Current wording

As of September 30, 2026, our real estate portfolio was comprised of 13 owned properties, which we refer to as our owned properties. Our owned properties were approximately 66.2% leased as of September 30, 2026, a decrease from 68.9% leased as of December 31, 2025. The 2.7% decrease in leased space was primarily a result of lease expirations exceeding new executed leases during the nine months ended September 30, 2026. As of September 30, 2026, we had approximately 1,558,000 square feet of vacancy in our owned properties compared to approximately 1,497,000 square feet of vacancy at December 31, 2025. During the nine months ended September 30, 2026, we leased approximately 226,000 square feet of office space in our owned properties, of which approximately 163,000 square feet were with existing tenants, at a weighted average term of 6.8 years. On average, tenant improvements for such leases were $32.10 per square foot, lease commissions were $10.90 per square foot and rent concessions were approximately five months of free rent. Average GAAP base rents under such leases were $33.57 per square foot, or 11.5% higher than average rents in the respective properties as applicable compared to the year ended December 31, 2025.

Previous wording

As of June 30, 2026, leases for approximately 3.0% and 11.5% of the square footage in our owned portfolio are scheduled to expire during 2026 and 2027, respectively. As the third quarter of 2026 begins, we believe that:

Current wording

As of September 30, 2026, leases for approximately 1.4% and 11.9% of the square footage in our owned portfolio are scheduled to expire during 2026 and 2027, respectively. As the fourth quarter of 2026 begins, we believe that:

Previous wording

•approximately half of our operating properties are stabilized with leased occupancy of 75% or more; and

Current wording

•five of our operating properties are stabilized with leased occupancy of 75% or more; and

Previous wording

•our remaining operating properties are value add in nature with leased occupancy of less than 75%.

Current wording

•our remaining eight operating properties are value add in nature with leased occupancy of less than 75%.

Previous wording

Existing vacancy is being actively marketed to numerous potential tenants. While leasing activity at our properties has continued, we believe that the impact of geopolitical events, current economic conditions and the long-term impact of the COVID-19 pandemic may limit or delay new tenant leasing during at least the third quarter of 2026 and potentially in future periods.

Current wording

Existing vacancy is being actively marketed to numerous potential tenants. While leasing activity at our properties has continued, we believe that the impact of geopolitical events, current economic conditions and the long-term impact of the COVID-19 pandemic may limit or delay new tenant leasing during at least the fourth quarter of 2026 and potentially in future periods.

Previous wording

The disposition of these properties do not represent a strategic shift that has a major effect on our operations and financial results. Our current strategy is to focus on the sunbelt and mountain west regions of the United States. Accordingly, the properties sold remained classified within continuing operations for all periods presented.

Current wording

The disposition of these properties did not represent a strategic shift that had a major effect on our operations and financial results. Accordingly, the properties sold remained classified within continuing operations for all periods presented.

Previous wording

Total revenues decreased by $0.4 million to $26.4 million for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025. The decrease was primarily a result of:

Current wording

Total revenues decreased by $2.4 million to $24.9 million for the three months ended September 30, 2026, as compared to the three months ended September 30, 2025. The decrease was primarily a result of:

Previous wording

Total expenses decreased by $0.6 million to $70.0 million for the six months ended June 30, 2026, as compared to the six months ended June 30, 2025. The decrease was primarily a result of:

Current wording

Total expenses decreased by $2.7 million to $33.2 million for the three months ended September 30, 2026, as compared to the three months ended September 30, 2025. The decrease was primarily a result of:

Previous wording

Loss on sale of properties and impairment on an asset held for sale

Current wording

Gain on sale of properties and impairment on an asset held for sale

Previous wording

Included in income taxes is the Revised Texas Franchise Tax, which is a tax on revenues from Texas properties, which was $49,000 during the three months ended June 30, 2026, compared to $51,000 during the three months ended June 30, 2025.

Current wording

Included in income taxes is the Revised Texas Franchise Tax, which is a tax on revenues from Texas properties, which was $55,000 during the three months ended September 30, 2026, compared to $3,000 during the three months ended September 30, 2025.

Previous wording

Net loss for the three months ended June 30, 2026 was $16.6 million, compared to a net loss of $7.9 million for the three months ended June 30, 2025, for the reasons described above.

Current wording

Net loss for the three months ended September 30, 2026 was $9.1 million, compared to a net loss of $8.3 million for the three months ended September 30, 2025, for the reasons described above.

Previous wording

The following table shows financial results for the six months ended June 30, 2026 and 2025:

Current wording

The following table shows financial results for the nine months ended September 30, 2026 and 2025:

Previous wording

Comparison of the six months ended June 30, 2026 to the six months ended June 30, 2025:

Current wording

Comparison of the nine months ended September 30, 2026 to the nine months ended September 30, 2025:

Previous wording

Total revenues decreased by $1.2 million to $52.6 million for the six months ended June 30, 2026, as compared to the six months ended June 30, 2025. The decrease was primarily a result of:

Current wording

Total revenues decreased by $3.6 million to $77.5 million for the nine months ended September 30, 2026, as compared to the nine months ended September 30, 2025. The decrease was primarily a result of:

Previous wording

During the six months ended June 30, 2026 and 2025, we repaid debt and incurred losses on extinguishment of debt of approximately $1.3 million and $5,000, respectively. The amounts during the six months ended June 30, 2026 are related to debt deal costs incurred from debt refinanced in February 2026 and the write-off of unamortized deferred financing and OID costs on the dates of debt repayments in 2026.

Current wording

During the nine months ended September 30, 2026 and 2025, we repaid debt and incurred losses on extinguishment of debt of approximately $2.3 million and $12,000, respectively. Losses on extinguishment of debt during the nine months ended September 30, 2026 were related to debt deal costs incurred from debt refinanced in February 2026 and the write-off of unamortized deferred financing and OID costs on the dates of debt repayments in 2026. The $12,000 loss on extinguishment of debt amount for the nine months ended September 30, 2025, was related to the write-off of unamortized deferred financing costs on the dates of the repayments.

Previous wording

On February 26, 2026, we closed a $320 million secured credit facility with an affiliate of TPG Credit. We repaid in full all of our then outstanding approximately $249 million aggregate principal amount of indebtedness with borrowings under the facility. The facility has an original stated maturity of February 26, 2029, subject to potential extension of up to one year at

Current wording

On July 8, 2026, we sold our Greenwood Plaza property located in Englewood, Colorado for a gross sales price of $19.4 million at a loss of approximately $7.7 million, which had been recorded as an impairment as of June 30, 2026. On July 8, 2026, we used approximately $8.5 million of the net proceeds from the disposition for the repayment of the Initial Term Loans, including interest and fees.

Previous wording

During the six months ended June 30, 2026 and June 30, 2025, we invested disposition proceeds in an interest-bearing account and earned $0.3 million and $0.5 million, respectively, in interest income.

Current wording

During the nine months ended September 30, 2026 and September 30, 2025, we invested disposition proceeds in an interest-bearing account and earned $0.6 million and $0.8 million, respectively, in interest income.

Previous wording

Included in income taxes is the Revised Texas Franchise Tax, which is a tax on revenues from Texas properties and which was $100,000 during the six months ended June 30, 2026, compared to $103,000 during the six months ended June 30, 2025.

Current wording

Included in income taxes is the Revised Texas Franchise Tax, which is a tax on revenues from Texas properties and which was $155,000 during the nine months ended September 30, 2026, compared to $106,000 during the nine months ended September 30, 2025.

Previous wording

Net loss for the six months ended June 30, 2026 was $26.1 million, compared to a net loss of $29.3 million for the six months ended June 30, 2025, for the reasons described above.

Current wording

Net loss for the nine months ended September 30, 2026 was $35.2 million, compared to a net loss of $37.6 million for the nine months ended September 30, 2025, for the reasons described above.

Previous wording

The information presented below provides the weighted average GAAP rent per square foot for the six months ended June 30, 2026 for our owned properties and weighted occupancy square feet and percentages. GAAP rent includes the impact of tenant concessions and reimbursements.

Current wording

The information presented below provides the weighted average GAAP rent per square foot for the nine months ended September 30, 2026 for our owned properties and weighted occupancy square feet and percentages. GAAP rent includes the impact of tenant concessions and reimbursements.

Previous wording

Cash and cash equivalents were $22.5 million and $30.6 million as of June 30, 2026 and December 31, 2025, respectively. The decrease of $8.1 million is attributable to $2.1 million used in operating activities, less $5.8 million used in investing activities less $0.2 million used in financing activities. Although there is no guarantee that we will be able to obtain the funds necessary for our future growth, we anticipate generating funds from continuing real estate operations, use of our Delayed Draw Term Loans (as defined below) and proceeds from property dispositions. We believe that we have adequate funds to cover unusual expenses and capital improvements, in addition to normal operating expenses. Our ability to pay any dividends to stockholders in the future will depend in significant part upon the level of rental income from our real properties, property dispositions and our interest costs.

Current wording

Cash and cash equivalents were $34.9 million and $30.6 million as of September 30, 2026 and December 31, 2025, respectively. The increase of $4.3 million is attributable to $4.7 million provided by operating activities, plus $8.2 million provided by investing activities less $8.6 million used in financing activities. Although there is no guarantee that we will be able to obtain the funds necessary for our future growth, we anticipate generating funds from continuing real estate operations, use of our Delayed Draw Term Loans (as defined below) and proceeds from property dispositions. We believe that we have adequate funds to cover unusual expenses and capital improvements, in addition to normal operating expenses. Our ability to pay any dividends to stockholders in the future will depend in significant part upon the level of rental income from our real properties, property dispositions and our interest costs.

Previous wording

Cash used in operating activities for the six months ended June 30, 2026, of $2.1 million is primarily attributable to a net loss of $26.1 million, excluding an impairment on an asset held for sale of $7.7 million plus the add-back of $26.2 million of non-cash expenses, less a decrease in accounts payable and accrued compensation of $7.2 million, less an increase in payment of deferred leasing commissions of $1.6 million, less an increase in tenant receivables of $1.0 million, less an increase in lease acquisition costs of $0.3 million plus an increase in prepaid expenses of $0.2 million.

Current wording

Cash provided by operating activities for the nine months ended September 30, 2026, of $4.7 million is primarily attributable to a net loss of $35.2 million, excluding a loss on the sale of a property of $7.7 million plus the add-back of $40.4 million of non-cash expenses, less a decrease in accounts payable and accrued compensation of $4.8 million, less an increase in payment of deferred leasing commissions of $2.5 million, less an increase in tenant receivables of $1.0 million, less an increase in lease acquisition costs of $0.3 million, less an increase in tenant security deposits of $0.1 million, plus an increase in prepaid expenses of $0.5 million.

Previous wording

Cash used in investing activities for the six months ended June 30, 2026, of $5.8 million is primarily attributable to purchases of other real estate assets and office equipment investments.

Current wording

Cash provided by investing activities for the nine months ended September 30, 2026, of $8.2 million is primarily attributable to proceeds from the sale of a property of $18.0 million and was partially offset by purchases of other real estate assets and office equipment investments of $9.8 million.

Previous wording

Cash used in financing activities for the six months ended June 30, 2026 of $0.2 million is primarily attributable to funding from our Term Loan of $258.5 million less payment of distributions to stockholders of $1.0 million, costs of extinguishment of debt of $1.0 million, the repayment of $249.0 million of our debt that was refinanced with the Term Loan and deferred financing costs of $7.7 million.

Current wording

Cash used in financing activities for the nine months ended September 30, 2026 of $8.6 million is primarily attributable to the repayment of $248.9 million of our debt that was refinanced with the Initial Term Loans (defined below) and related deferred financing costs of $7.7 million, repayment of $8.1 million principal amount of our Initial Term Loans, payment of distributions to stockholders of $1.0 million and costs of the extinguishment of debt of $1.4 million, These uses were partially offset by funding from our Initial Term Loans of $258.5 million.

Previous wording

of $275 million (the “Initial Term Loans”), and (ii) delayed draw term loans available upon the approval of the Lenders after the Closing Date in an aggregate principal amount of up to $45 million (the “Delayed Draw Term Loans” and together with the Initial Term Loans, the “Term Loans”). The Delayed Draw Term Loans may be used, subject to certain conditions, to fund tenant improvements, leasing commissions, building improvements and other uses approved by the Lenders. The Term Loans are not subject to amortization and have an initial stated maturity date of February 26, 2029. The maturity date is subject to potential extension of up to one year at the option of the Company, subject to the satisfaction of certain conditions. We used the proceeds of the Initial Term Loans on the Closing Date to refinance and retire all outstanding indebtedness under the BMO Term Loan, BofA Term Loan and the Senior Notes (each as defined below). See Note 2, Term Loans Payable and Senior Notes, of the Notes to Consolidated Financial Statements contained in Part I, Item 1 of this Quarterly Report on Form 10-Q for further information on the Credit Agreement.

Current wording

On February 26, 2026 (the “Closing Date”), we entered into a Credit Agreement (the “Credit Agreement”) with Alter Domus (US) LLC, as administrative agent, and Silver Oak Capital LLC, an affiliate of TPG Credit (collectively, the lenders from time-to-time party thereto, the “Lenders”). The Credit Agreement provides for a secured credit facility for aggregate principal commitments of up to $320 million, consisting of (i) initial term loans in an aggregate principal amount of $275 million (the “Initial Term Loans”), and (ii) delayed draw term loans available upon the approval of the Lenders after the Closing Date in an aggregate principal amount of up to $45 million (the “Delayed Draw Term Loans” and together with the Initial Term Loans, the “Term Loans”). The Delayed Draw Term Loans may be used, subject to certain conditions, to fund tenant improvements, leasing commissions, building improvements and other uses approved by the Lenders. The Term Loans are not subject to amortization and have an initial stated maturity date of February 26, 2029. The maturity date is subject to potential extension of up to one year at the option of the Company, subject to the satisfaction of certain conditions. We used the proceeds of the Initial Term Loans on the Closing Date to refinance and retire all outstanding indebtedness under the BMO Term Loan, BofA Term Loan and the Senior Notes (each as defined below). See Note 2, Term Loans Payable and Senior Notes, of the Notes to Consolidated Financial Statements contained in Part I, Item 1 of this Quarterly Report on Form 10-Q for further information on the Credit Agreement.

Previous wording

Effective April 1, 2025, the interest rate on the BofA Term Loan increased from 8.00% per annum to 9.00% per annum. As of February 26,2026 and December 31, 2025, the interest rate on the BofA Term Loan was 9.00% per annum. The weighted average variable interest rate on all amounts outstanding under the BofA Term Loan was 9% for the period of January 1, 2026 until February 26, 2026 and was 8.75% for the year ended December 31, 2025.

Current wording

Effective April 1, 2025, the interest rate on the BofA Term Loan increased from 8.00% per annum to 9.00% per annum. As of February 26, 2026 and December 31, 2025, the interest rate on the BofA Term Loan was 9.00% per annum. The weighted average variable interest rate on all amounts outstanding under the BofA Term Loan was 9% for the period of January 1, 2026 until February 26, 2026 and was 8.75% for the year ended December 31, 2025.

Previous wording

We generally pay the ordinary annual operating expenses of our owned and consolidated properties from the rental revenue generated by the properties. For the three and six months ended June 30, 2026 and 2025, respectively, the rental income exceeded the expenses for each individual property, with the exception of Monument Circle’s property for the three and six months ended June 30, 2025. Monument Circle sold its property on June 6, 2025. Monument Circle had approximately $56,000 and $132,000 of rental income and $157,000 and $450,000 of operating expenses for the three and six months ended June 30, 2025, respectively.

Current wording

We generally pay the ordinary annual operating expenses of our owned and consolidated properties from the rental revenue generated by the properties. For the three and nine months ended September 30, 2026 and 2025, respectively, the rental income exceeded the expenses for each individual property, with the exception of Monument Circle’s property for the nine months ended September 30, 2025. Monument Circle sold its property on June 6, 2025. Monument Circle had approximately $132,000 of rental income and $445,000 of operating expenses for the nine months ended September 30, 2025.