Industrial Logistics Properties Trust

Previous wording

We are a real estate investment trust, or REIT, organized under Maryland law. As of June 30, 2025, our portfolio was comprised of 411 properties containing approximately 59,890,000 rentable square feet located in 39 states with 94.3% occupancy, leased to approximately 300 different tenants, including one property classified as held for sale. As of June 30, 2025, we also owned a 22% equity interest in the unconsolidated joint venture.

Current wording

We are a real estate investment trust, or REIT, organized under Maryland law. As of September 30, 2025, our portfolio was comprised of 411 properties containing approximately 59,890,000 rentable square feet located in 39 states with 94.1% occupancy, leased to approximately 300 different tenants, including three properties classified as held for sale. As of September 30, 2025, we also owned a 22% equity interest in the unconsolidated joint venture.

Previous wording

We believe consumer 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, uncertainties surrounding interest rates and inflation globally and in the United States, wars or other global geopolitical hostilities and tensions and the impacts of or changes to tariffs and trade policies, have given rise to economic uncertainty and have caused, and may continue to cause, disruptions in the financial markets. For example, there have been significant changes to U.S. and foreign trade policies, treaties and tariffs, which have led to, and may continue to cause, the disruption of global supply chains, additional or increased tariffs and other import-export barriers, sudden fluctuations in commodity prices and costs, greater political instability and the implementation of sanctions and heightened cybersecurity concerns, any or all of which may create long-term macroeconomic challenges, limit liquidity opportunities or lead to higher costs, for us and our tenants. These conditions, if continued, 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.

Current wording

We believe consumer expectations, long-term growth of e-commerce and modernization of and demand for supply chain resiliency will keep demand for industrial properties strong for the foreseeable future. However, uncertainties surrounding interest rates and inflation globally and in the United States, wars or other global geopolitical hostilities and tensions, the impacts of or changes to tariffs and trade policies and any U.S. government shutdown, have given rise to economic uncertainty and have caused, and may continue to cause, disruptions in the financial markets. For example, there have been significant changes to U.S. and foreign trade policies, treaties and tariffs, which have led to, and may continue to cause, the disruption of global supply chains, additional or increased tariffs and other import-export barriers, sudden fluctuations in commodity prices and costs, greater political instability and the implementation of sanctions and heightened cybersecurity concerns, any or all of which may create long-term macroeconomic challenges, limit liquidity opportunities or lead to higher costs, for us and our tenants. These conditions, if continued, 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.

Previous wording

(3)Leased square feet is pursuant to existing leases as of June 30, 2025, and includes space being fitted out for occupancy, if any, and space which is leased but is not occupied, if any.

Current wording

(2)Leased square feet is pursuant to existing leases as of September 30, 2025, and includes space being fitted out for occupancy, if any, and space which is leased but is not occupied, if any.

Previous wording

The average effective rental rates per square foot represents total rental income divided by the average rentable square feet leased during the periods specified for our properties. For the three and six months ended June 30, 2025 and 2024, the average effective rental rates per square foot of our properties were as follows:

Current wording

The average effective rental rates per square foot represents total rental income divided by the average rentable square feet leased during the periods specified for our properties. For the three and nine months ended September 30, 2025 and 2024, the average effective rental rates per square foot of our properties were as follows:

Previous wording

(1)For the three months ended June 30, 2025 and 2024, consists of properties that we have owned continuously since April 1, 2024 and excludes one property classified as held for sale as of June 30, 2025.

Current wording

(1)For the three months ended September 30, 2025 and 2024, consists of properties that we have owned continuously since July 1, 2024 and excludes three properties classified as held for sale as of September 30, 2025.

Previous wording

(2)For the six months ended June 30, 2025 and 2024, consists of properties that we have owned continuously since January 1, 2024 and excludes one property classified as held for sale as of June 30, 2025.

Current wording

(2)For the nine months ended September 30, 2025 and 2024, consists of properties that we have owned continuously since January 1, 2024 and excludes three properties classified as held for sale as of September 30, 2025.

Previous wording

During the three and six months ended June 30, 2025, we entered into new and renewal leases as summarized in the following table, excluding the impact of rent resets (square feet in thousands):

Current wording

During the three and nine months ended September 30, 2025, we entered into new and renewal leases as summarized in the following table, excluding the impact of rent resets (square feet in thousands):

Previous wording

During the six months ended June 30, 2025, we completed rent resets for approximately 144,000 square feet of land at our Hawaii Properties at rental rates that were 34.6% higher than prior rental rates.

Current wording

During the nine months ended September 30, 2025, we completed rent resets for approximately 204,000 square feet of land at our Hawaii Properties at rental rates that were 29.1% higher than prior rental rates.

Previous wording

As of June 30, 2025, FedEx and Amazon leased 22.6% and 8.1% of our total leased square feet, respectively, and represented 28.8% and 6.7% of our total annualized rental revenues, respectively.

Current wording

As of September 30, 2025, FedEx and Amazon leased 22.7% and 8.1% of our total leased square feet, respectively, and represented 28.3% and 6.8% of our total annualized rental revenues, respectively.

Previous wording

As of June 30, 2025, $10,079, or 2.3%, of our annualized rental revenues was included in leases scheduled to expire by June 30, 2026 and 5.7% of our rentable square feet was 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. Despite our 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.

Current wording

As of September 30, 2025, $17,435, or 4.0%, of our annualized rental revenues was included in leases scheduled to expire by September 30, 2026 and 5.9% of our rentable square feet was 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. Despite our 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.

Previous wording

Rental income. Rental income increased primarily due to increases from our net leasing activity and rent resets, partially offset by vacancies at certain of our properties.

Current wording

Rental income. Rental income increased primarily due to increases from our net leasing activity and rent resets.

Previous wording

Real estate taxes. Real estate taxes decreased primarily due to a lowered assessed value as a result of a successful real estate tax appeal at one of our Mainland Properties.

Current wording

Real estate taxes. Real estate taxes decreased primarily due to lowered assessed values as a result of successful tax appeals at certain of our properties.

Previous wording

Other operating expenses. The decrease in other operating expenses is primarily due to decreases in professional fees and insurance expenses, partially offset by increases in payroll costs reimbursable to RMR.

Current wording

Other operating expenses. The decrease in other operating expenses is primarily due to decreases in payroll costs reimbursable to RMR and professional fees, partially offset by increases in electricity expenses at certain of our properties.

Previous wording

General and administrative. The increase in general and administrative expenses is primarily due to an increase in accrued incentive management fees of $2,278 during the six months ended June 30, 2025.

Current wording

General and administrative. The increase in general and administrative expenses is primarily due to accrued incentive management fees of $2,438 at September 30, 2025. Additionally, franchise taxes and legal costs, as well as general and administrative expenses paid in common shares increased during the three months ended September 30, 2025.

Previous wording

Interest and other income. The decrease in interest and other income is primarily due to lower interest rates and average cash balances during the 2025 period as compared to the 2024 period.

Current wording

Interest and other income. The decrease in interest and other income is primarily due to lower average cash balances and interest rates during the 2025 period as compared to the 2024 period.

Previous wording

Six Months Ended June 30, 2025 Compared to Six Months Ended June 30, 2024 (dollars and share amounts in thousands, except per share data)

Current wording

Nine Months Ended September 30, 2025 Compared to Nine Months Ended September 30, 2024 (dollars and share amounts in thousands, except per share data)

Previous wording

References to changes in the income and expense categories below relate to the comparison of results for the six months ended June 30, 2025 compared to the six months ended June 30, 2024.

Current wording

References to changes in the income and expense categories below relate to the comparison of results for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024.

Previous wording

Rental income. Rental income increased primarily due to increases from our net leasing activity and rent resets, partially offset by vacancies at certain of our properties.

Current wording

Rental income. Rental income increased primarily due to increases from our net leasing activity and rent resets, partially offset by a decrease in real estate tax reimbursements and vacancies at certain of our properties.

Previous wording

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

Current wording

Real estate taxes. Real estate taxes decreased primarily due to lowered assessed values as a result of successful tax appeals at certain of our properties.

Previous wording

General and administrative. The increase in general and administrative expenses is primarily due to an increase in accrued incentive management fees of $1,311 and increases in legal fees during the three months ended June 30, 2025.

Current wording

General and administrative. The increase in general and administrative expenses is primarily due to accrued incentive management fees of $4,716 for the 2025 period and an increase in legal fees.

Previous wording

Interest and other income. The decrease in interest and other income is primarily due to lower interest rates and average cash balances during the 2025 period as compared to the 2024 period.

Current wording

Interest and other income. The decrease in interest and other income is primarily due to lower average cash balances and interest rates during the 2025 period as compared to the 2024 period.

Previous wording

Interest expense. The decrease in interest expense is primarily due to decreased amortization of debt issuance and interest rate cap costs related to our floating rate loans, partially offset by higher average strike rates on our interest rate caps designated as cash flow hedges compared to the 2024 period.

Current wording

Interest expense. The decrease in interest expense is primarily due to the repayment of the ILPT Floating Rate Loan in June 2025 and the discontinuation of hedge accounting for the related interest rate cap. As a result, no further amortization of the related interest rate cap was recognized during the 2025 period. Additionally, amortization of interest rate cap costs of our consolidated joint venture and debt issuance costs decreased during the 2025 period. These decreases were partially offset by higher average strike rates on our interest rate cap designated as a cash flow hedge compared to the 2024 period.

Previous wording

Loss on extinguishment of debt. During the three months ended June 30, 2025, we recognized a loss on extinguishment of debt in connection with the repayment of the ILPT Floating Rate Loan.

Current wording

Loss on extinguishment of debt. During the nine months ended September 30, 2025, we recognized a loss on extinguishment of debt in connection with the repayment of the ILPT Floating Rate Loan.

Previous wording

The following table presents the reconciliation of net loss to NOI for the three and six months ended June 30, 2025 and 2024:

Current wording

The following table presents the reconciliation of net loss to NOI for the three and nine months ended September 30, 2025 and 2024:

Previous wording

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: (1) net loss attributable to common shareholders calculated in accordance with GAAP, excluding (i) any recovery or loss on impairment of real estate, (ii) any gain or loss on sale of real estate and (iii) equity in earnings or losses of unconsolidated joint venture; (2) plus (i) real estate depreciation and amortization and (ii) our proportionate share of FFO from unconsolidated joint venture properties; (3) minus FFO adjustments attributable to noncontrolling interest; and (4) certain other adjustments currently not applicable to us. In calculating Normalized FFO attributable to common shareholders, we adjust for certain nonrecurring items shown below, including adjustments for such items related to the unconsolidated joint venture, if any, loss on extinguishment of debt, if any, and incentive management fees, if any.

Current wording

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: (1) net loss attributable to common shareholders calculated in accordance with GAAP, excluding (i) any recovery or loss on impairment of real estate, (ii) any gain or loss on sale of real estate and (iii) equity in earnings or losses of unconsolidated joint venture; (2) plus (i) real estate depreciation and amortization and (ii) our proportionate share of FFO from unconsolidated joint venture properties; (3) minus FFO adjustments attributable to noncontrolling interests; and (4) certain other adjustments currently not applicable to us. In calculating Normalized FFO attributable to common shareholders, we adjust for certain nonrecurring items shown below, including adjustments for such items related to the unconsolidated joint venture, if any, loss on extinguishment of debt, if any, and incentive management fees, if any.

Previous wording

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 and six months ended June 30, 2025 and 2024:

Current wording

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 and nine months ended September 30, 2025 and 2024:

Previous wording

Our principal sources of funds to meet our operating and capital obligations, pay our debt service obligations and make distributions to our shareholders are rents from tenants at our properties. As of June 30, 2025, investment grade rated tenants, subsidiaries of investment grade rated parent entities or our Hawaii land leases represented 76.2% of our annualized rental revenues and only 2.3% 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 obligations, pay our debt service obligations and make distributions to our shareholders for the next 12 months and for the foreseeable future thereafter.

Current wording

Our principal sources of funds to meet our operating and capital obligations, pay our debt service obligations and make distributions to our shareholders are rents from tenants at our properties. As of September 30, 2025, investment grade rated tenants, subsidiaries of investment grade rated parent entities or our Hawaii land leases represented 76.2% of our annualized rental revenues and only 4.0% 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 obligations, pay our debt service obligations and make distributions to our shareholders for the next 12 months and for the foreseeable future thereafter.

Previous wording

The increase in net cash provided by operating activities for the six months ended June 30, 2025 compared to the 2024 period is primarily due to lower cash interest expense, excluding the impact of settlement of our interest rate caps. The change in net cash (used in) provided by investing activities for the six months ended June 30, 2025 compared to the 2024 period is primarily due to a decrease in proceeds from settlement of interest rate caps and an increase in real estate improvements, partially offset by reduced interest rate cap purchase costs. The change in net cash used in financing activities for the six months ended June 30, 2025 compared to the 2024 period is primarily due to the repayment of the ILPT Floating Rate Loan, partially offset by the net proceeds received from our $1,160,000 mortgage loan.

Current wording

The increase in net cash from operating activities for the nine months ended September 30, 2025 compared to the 2024 period is primarily due to lower interest expense, excluding the impact of settlement of our interest rate caps, and higher cash flows and reimbursements from our properties. The decrease in net cash from investing activities for the nine months ended September 30, 2025 compared to the 2024 period is primarily due to a decrease in proceeds from settlement of interest rate caps and an increase in real estate improvements, partially offset by reduced interest rate cap purchase costs. The decrease in net cash from financing activities for the nine months ended September 30, 2025 compared to the 2024 period is primarily due to the repayment of the ILPT Floating Rate Loan and increases in debt issuance costs and distributions to common shareholders, partially offset by the net proceeds received from our $1,160,000 mortgage loan.

Previous wording

As of June 30, 2025, we had cash and cash equivalents, excluding restricted cash and cash equivalents, of $58,559. To maintain our qualification for taxation as a REIT under the Internal Revenue Code of 1986, as amended, 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 any offerings of equity or debt securities to fund our distributions to our shareholders.

Current wording

As of September 30, 2025, we had cash and cash equivalents, excluding restricted cash and cash equivalents, of $83,173. To maintain our qualification for taxation as a REIT under the Internal Revenue Code of 1986, as amended, 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 any offerings of equity or debt securities to fund our distributions to our shareholders.

Previous wording

As of June 30, 2025, committed, but unspent, tenant related obligations based on existing leases were $4,819, all of which are expected to be spent during the next 12 months.

Current wording

As of September 30, 2025, committed, but unspent, tenant related obligations based on existing leases were $4,988, all of which are expected to be spent during the next 12 months.

Previous wording

We own a 61% equity interest in our consolidated joint venture. We control this 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 also own a 22% equity interest in the unconsolidated joint venture. We account for the unconsolidated joint venture using the equity method of accounting under the fair value option. The unconsolidated joint venture made aggregate cash distributions to us of $990 for each of the three months ended June 30, 2025 and 2024, and $1,980 for each of the six months ended June 30, 2025 and 2024, respectively.

Current wording

We own a 61% equity interest in our consolidated joint venture. We control this 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 also own a 22% equity interest in the unconsolidated joint venture. We account for the unconsolidated joint venture using the equity method of accounting under the fair value option. The unconsolidated joint venture made aggregate cash distributions to us of $990 for each of the three months ended September 30, 2025 and 2024, and $2,970 for each of the nine months ended September 30, 2025 and 2024, respectively.

Previous wording

As of June 30, 2025, we had an aggregate principal amount of $4,223,519 of indebtedness, primarily including (1) our $1,160,000 mortgage loan, (2) the Mountain Floating Rate Loan, (3) our $700,000 mortgage loan and (4) our $650,000 mortgage loan, with maturity dates after giving effect to potential exercises of all extension options between 2027 and 2038.

Current wording

As of September 30, 2025, we had an aggregate principal amount of $4,218,799 of indebtedness, primarily including (1) our $1,160,000 mortgage loan, (2) the Mountain Floating Rate Loan, (3) our $700,000 mortgage loan and (4) our $650,000 mortgage loan, with maturity dates after giving effect to potential exercises of all extension options between 2027 and 2038.

Previous wording

In June 2025, we obtained a $1,160,000 fixed rate, interest only mortgage loan secured by 101 of our properties. This mortgage loan matures in July 2030 and requires that interest be paid at an annual rate of 6.40%. Subject to the satisfaction of certain conditions, we have the option to prepay our $1,160,000 mortgage loan in full or in part with a premium prior to January 9, 2030 and at par with no premium on or after January 9, 2030. We used the net proceeds from our $1,160,000 mortgage loan and cash on hand to repay in full the ILPT Floating Rate Loan. The ILPT Floating Rate Loan was secured by 104 of our properties, was scheduled to mature in October 2025 and required that interest be paid at an annual rate of SOFR plus a weighted average premium of 3.93%. At the time of repayment of the ILPT Floating Rate Loan, we believe that we were in compliance with all of the covenants and other terms under the agreement governing such loan. During the three and six months ended June 30, 2025, we recognized a $5,070 loss on extinguishment of debt related to the repayment of the ILPT Floating Rate Loan.

Current wording

In June 2025, we obtained a $1,160,000 fixed rate, interest only mortgage loan secured by 101 of our properties. This mortgage loan matures in July 2030 and requires that interest be paid at an annual rate of 6.40%. Subject to the satisfaction of certain conditions, we have the option to prepay our $1,160,000 mortgage loan in full or in part with a premium prior to January 9, 2030 and at par with no premium on or after January 9, 2030. We used the net proceeds from our $1,160,000 mortgage loan and cash on hand to repay in full the ILPT Floating Rate Loan. The ILPT Floating Rate Loan was secured by 104 of our properties, was scheduled to mature in October 2025 and required that interest be paid at an annual rate of SOFR plus a weighted average premium of 3.93%. During the nine months ended September 30, 2025, we recognized a $5,070 loss on extinguishment of debt related to the repayment of the ILPT Floating Rate Loan.

Previous wording

The Mountain Floating Rate Loan is secured by 82 properties, matures in March 2026, subject to one remaining one-year extension option, and requires that interest be paid at an annual rate of SOFR plus a premium of 2.77%. In March 2025, our consolidated joint venture exercised the second of its three, one-year extension options for the maturity date of this loan. In connection with the exercise of the extension, our consolidated joint venture purchased a one-year interest rate cap for $15,010 with a SOFR strike rate equal to 3.10%, which replaced the previous interest rate cap with a SOFR strike rate equal to 3.04%. Subject to the satisfaction of certain conditions, our consolidated joint venture has the option to prepay the Mountain Floating Rate Loan in full or in part at any time at par with no premium.

Current wording

The Mountain Floating Rate Loan is secured by 82 properties, matures in March 2026, subject to one remaining one-year extension option, and requires that interest be paid at an annual rate of SOFR plus a premium of 2.77%. In March 2025, our consolidated joint venture exercised the second of its three, one-year extension options for the maturity date of this loan. In connection with the exercise of the extension, our consolidated joint venture purchased a one-year interest rate cap for $15,010 with a SOFR strike rate equal to 3.10%, which replaced the previous interest rate cap with a SOFR strike rate equal to 3.04%. Subject to the satisfaction of certain conditions, our consolidated joint venture has the option to prepay the Mountain Floating Rate Loan in full or in part at any time at par with no premium. The weighted average interest rates under the Mountain Floating Rate Loan were 5.87% and 5.85% for three and nine months ended September 30, 2025, respectively, including the impact of our interest rate caps.

Previous wording

For further information regarding our indebtedness, see Notes 5 and 6 to our condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

Current wording

For further information regarding our indebtedness and historical weighted average interest rates under our floating rate loans, see Notes 5 and 6 to our condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

Previous wording

During the six months ended June 30, 2025, we declared and paid a regular quarterly distribution to common shareholders totaling $1,323 using cash on hand.

Current wording

During the nine months ended September 30, 2025, we declared and paid regular quarterly distributions to common shareholders totaling $4,640 using cash on hand.

Previous wording

On July 10, 2025, we declared a regular quarterly distribution to common shareholders of record on July 21, 2025 of $0.05 per share, or approximately $3,317. We expect to pay this distribution on or about August 14, 2025 using cash on hand.

Current wording

On October 9, 2025, we declared a regular quarterly distribution to common shareholders of record on October 27, 2025 of $0.05 per share, or approximately $3,333. We expect to pay this distribution on or about November 13, 2025 using cash on hand.