1 Industrial Logistics Properties Trust Third Quarter 2023 Financial Results and Supplemental Information October 25, 2023 Exhibit 99.2510 John Dodd Road Spartanburg, SC 1,015,740 Square Feet ILPT Ownership 100%
2Q3 2023RETURN TO TABLE OF CONTENTS QUARTERLY RESULTS Industrial Logistics Properties Trust Announces Third Quarter 2023 Financial Results .................................................... 4 Third Quarter 2023 Highlights ......................................................................................................................... 5 FINANCIALS Key Financial Data ............................................................................................................................................................................................... 7 Condensed Consolidated Statements of Income (Loss) .............................................................................................................................. 8 Condensed Consolidated Balance Sheets ..................................................................................................................................................... 9 Debt Summary .................................................................................................................................................................................................... 10 Debt Maturity Schedule ...................................................................................................................................................................................... 11 Leverage and Coverage Ratios ......................................................................................................................................................................... 12 Capital Expenditures Summary ......................................................................................................................................................................... 13 Property Acquisitions and Dispositions ......................................................................................................................................................... 14 PORTFOLIO INFORMATION Same Property Results ........................................................................................................................................................................................ 16 Occupancy and Leasing Summary ................................................................................................................................................................... 17 Tenant Credit Characteristics and Concentration ......................................................................................................................................... 18 Portfolio Lease Expiration and Reset Schedules ........................................................................................................................................... 19 Key Financial Data by Investment Portfolio .................................................................................................................................................... 20 JOINT VENTURES Consolidated Joint Venture - Mountain Industrial REIT LLC ....................................................................................................................... 22 Consolidated Joint Venture - Financial Information ..................................................................................................................................... 23 - 24 Consolidated Joint Venture - Portfolio Information ...................................................................................................................................... 25 Unconsolidated Joint Venture - The Industrial Fund REIT LLC ................................................................................................................... 26 APPENDIX Company Profile and Research Coverage ...................................................................................................................................................... 28 Governance Information .................................................................................................................................................................................... 29 Non-GAAP Financial Measures and Certain Definitions .............................................................................................................................. 30 - 32 Calculation and Reconciliation of NOI and Cash Basis NOI ........................................................................................................................ 33 Reconciliation of NOI to Same Property NOI and Calculation of Same Property Cash Basis NOI ...................................................... 34 Calculation of EBITDA, EBITDAre and Adjusted EBITDAre ......................................................................................................................... 35 Calculation of FFO, Normalized FFO and CAD ............................................................................................................................................. 36 - 37 WARNING CONCERNING FORWARD-LOOKING STATEMENTS 38 Table of Contents All amounts for interim periods in this presentation are unaudited. Please refer to Non-GAAP Financial Measures and Certain Definitions for terms used throughout this document. Trading Symbols: Common Shares: ILPT Investor Relations Contact Stephen Colbert, Director (617) 231-3223 scolbert@ilptreit.com Corporate Headquarters Two Newton Place 255 Washington Street, Suite 300 Newton, Massachusetts 02458-1634
3Q3 2023RETURN TO TABLE OF CONTENTS Quarterly Results
4Q3 2023RETURN TO TABLE OF CONTENTS "During the third quarter, ILPT experienced same property NOI and same property Cash Basis NOI growth of 5.3% and 6.0%, respectively. This growth is primarily the result of strong leasing activity during 2022 and the first half of 2023, which is now being realized in earnings. With a 98.9% leased portfolio, exceptional tenant roster and no near- term debt maturities, we continue to evaluate operational synergies and opportunities for continued mark-to-market rent growth." Yael Duffy, President and Chief Operating Officer INDUSTRIAL LOGISTICS PROPERTIES TRUST ANNOUNCES THIRD QUARTER 2023 FINANCIAL RESULTS Newton, MA (October 25, 2023): Industrial Logistics Properties Trust (Nasdaq: ILPT) today announced its financial results for the quarter ended September 30, 2023. Dividend ILPT has declared a quarterly distribution on its common shares of $0.01 per share to shareholders of record as of the close of business on October 23, 2023. The distribution will be paid on or about November 16, 2023. Conference Call A conference call to discuss ILPT's third quarter results will be held on Thursday, October 26, 2023 at 10:00 a.m. Eastern Time. The conference call may be accessed by dialing (877) 418-4826 or (412) 902-6758 (if calling from outside the United States and Canada); a pass code is not required. A replay will be available for one week by dialing (412) 317-0088; the replay pass code is 5188194. A live audio webcast of the conference call will also be available in a listen-only mode on ILPT’s website, at www.ilptreit.com. The archived webcast will be available for replay on ILPT’s website after the call. The transcription, recording and retransmission, in any way, are strictly prohibited without the prior written consent of ILPT. About Industrial Logistics Properties Trust Industrial Logistics Properties Trust (Nasdaq: ILPT) is a real estate investment trust, or REIT, focused on owning and leasing high quality distribution and logistics properties. As of September 30, 2023, ILPT’s portfolio consisted of 413 properties containing approximately 60.0 million rentable square feet located in 39 states. Approximately 77% of ILPT’s annualized rental revenues as of September 30, 2023 are derived from investment grade tenants, tenants that are subsidiaries of investment grade rated entities or Hawaii land leases. ILPT is managed by The RMR Group (Nasdaq: RMR), a leading U.S. alternative asset management company with approximately $36 billion in assets under management as of September 30, 2023 and more than 35 years of institutional experience in buying, selling, financing and operating commercial real estate. ILPT is headquartered in Newton, MA. For more information, visit www.ilptreit.com.
5Q3 2023RETURN TO TABLE OF CONTENTS Portfolio Update • Executed 758,000 square feet of new and renewal leases at 13.5% higher rents. • Lease renewals accounted for approximately 92% of leasing activity, which highlights strong tenant retention and continued demand for ILPT's high quality warehouse and distribution properties. • Portfolio occupancy of 98.9% and a weighted average lease term (by annualized rental revenues) of 8.2 years. • Leases with investment grade tenants (or their subsidiaries) and Hawaii land leases generated 77% of ILPT's annualized rental revenues. Financial Results • Net loss attributable to common shareholders was $26.1 million, or $0.40 per diluted share. • Normalized FFO attributable to common shareholders was $7.9 million, or $0.12 per diluted share. • Adjusted EBITDAre increased 9.4% to $83.2 million compared to the third quarter of 2022. • Leasing activity since September 30, 2022 resulted in increases in same property NOI and same property Cash Basis NOI of 5.3% and 6.0%, respectively, compared to the third quarter of 2022. Disposition Activities • One unencumbered property under agreement to sell for a sales price of $21.5 million, excluding closing costs, as of October 25, 2023. Third Quarter 2023 Highlights (As of and for the three months ended September 30, 2023, unless otherwise noted)
6Q3 2023RETURN TO TABLE OF CONTENTS Financials
7Q3 2023RETURN TO TABLE OF CONTENTS (dollars in thousands, except per share data) As of and for the Three Months Ended As of 9/30/2023 6/30/2023 3/31/2023 12/31/2022 9/30/2022 9/30/2023 Selected Income Statement Data: Capitalization: Rental income $ 110,142 $ 108,043 $ 110,258 $ 106,339 $ 103,215 Total common shares (at end of period) 65,845,073 Net loss $ (36,191) $ (36,580) $ (35,546) $ (41,759) $ (83,974) Closing price (at end of period) $ 2.89 Net loss attributable to common shareholders $ (26,112) $ (25,828) $ (24,809) $ (31,043) $ (45,627) Equity market capitalization (at end of period) $ 190,292 NOI $ 85,309 $ 84,424 $ 84,473 $ 83,598 $ 81,013 Debt (principal balance) 4,330,370 Cash Basis NOI $ 81,643 $ 80,827 $ 80,441 $ 79,931 $ 76,969 Total market capitalization $ 4,520,662 Adjusted EBITDAre $ 83,194 $ 81,331 $ 80,712 $ 79,213 $ 76,072 FFO attributable to common shareholders $ 7,945 $ 7,375 $ 7,916 $ 5,440 $ (10,134) Liquidity: Normalized FFO attributable to common shareholders $ 7,945 $ 7,594 $ 7,916 $ 5,440 $ 14,873 Cash and cash equivalents 83,283 CAD attributable to common shareholders $ 10,505 $ 9,803 $ 10,182 $ 4,748 $ 8,290 Total liquidity $ 83,283 Rolling four quarter CAD attributable to common shareholders $ 35,238 $ 33,023 $ 42,701 $ 55,675 $ 77,104 Per Common Share Data (basic and diluted): Net loss attributable to common shareholders $ (0.40) $ (0.40) $ (0.38) $ (0.48) $ (0.70) FFO attributable to common shareholders $ 0.12 $ 0.11 $ 0.12 $ 0.08 $ (0.16) Normalized FFO attributable to common shareholders $ 0.12 $ 0.12 $ 0.12 $ 0.08 $ 0.23 CAD attributable to common shareholders $ 0.16 $ 0.15 $ 0.16 $ 0.07 $ 0.13 Rolling four quarter CAD attributable to common shareholders $ 0.54 $ 0.51 $ 0.65 $ 0.85 $ 1.18 Dividends: Annualized dividends paid per share $ 0.04 $ 0.04 $ 0.04 $ 0.04 $ 0.04 Annualized dividend yield (at end of period) 1.4% 1.2% 1.3% 1.2% 0.7% Annualized Normalized FFO attributable to common shareholders payout ratio 8.3% 8.3% 8.3% 12.5% 4.3% CAD attributable to common shareholders payout ratio 6.3% 6.7% 6.3% 14.3% 7.7% Rolling four quarter CAD attributable to common shareholders payout ratio 7.4% 7.8% 6.2% 4.7% 3.4% Selected Balance Sheet Data: Total gross assets $6,000,494 $5,997,715 $5,939,557 $5,949,633 $5,962,116 Total assets $5,634,315 $5,662,080 $5,634,976 $5,676,166 $5,719,635 Total liabilities $4,416,177 $4,400,791 $4,348,801 $4,345,395 $4,358,125 Total equity $1,218,138 $1,261,289 $1,286,175 $1,330,771 $1,361,510 Key Financial Data
8Q3 2023RETURN TO TABLE OF CONTENTS Condensed Consolidated Statements of Income (Loss) 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) Weighted average common shares outstanding (basic and diluted) 65,488 65,250 65,389 65,228 Net loss per share attributable to common shareholders (basic and diluted) $ (0.40) $ (0.70) $ (1.17) $ (3.00) Additional data: General and administrative expenses / total assets (at end of period) 0.1% 0.2% 0.4% 0.4% Non-cash straight line rent adjustments included in rental income $ 3,414 $ 3,794 $ 10,531 $ 8,170 Lease value amortization included in rental income $ 252 $ 250 $ 764 $ 4,265 Lease termination fees included in rental income $ — $ — $ — $ 30 (amounts in thousands, except percentage data and per share data) 22525 West 167th Street Olathe, KS 313,763 Square Feet ILPT Ownership: 61%
9Q3 2023RETURN TO TABLE OF CONTENTS Condensed Consolidated Balance Sheets September 30, December 31, 2023 2022 ASSETS Real estate properties 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 (dollars in thousands, except per share data) 8411 Florida Mining Boulevard Tampa, FL 174,975 Square Feet ILPT Ownership: 61%
10Q3 2023RETURN TO TABLE OF CONTENTS (1) Interest rates reflect the impact of interest rate caps, as applicable. (2) Principal balance excludes unamortized debt issuance costs related to these debts. Total debt outstanding as of September 30, 2023, including unamortized debt issuance costs totaling $26,739, was $4,303,631. (3) The $1,235,000 loan has an initial maturity date of October 9, 2024, with three, one year extension options, subject to the satisfaction of certain conditions, 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%. ILPT purchased an interest rate cap through October 2024 with a SOFR strike rate equal to 2.25%. (4) Mountain JV is Mountain Industrial REIT LLC, ILPT's consolidated joint venture in which ILPT owns a 61% equity interest. See pages 22-25 for more information. (5) The $1,400,000 loan has an original maturity date of March 9, 2024 with three, one year extension options, and requires that interest be paid at an annual rate of SOFR plus a premium of 2.77%. Mountain JV purchased an interest rate cap through March 2024 with a SOFR strike rate equal to 3.40%. Interest Principal Maturity Years to Entity Type Secured By Rate (1) Balance (2) Date Maturity ILPT Floating rate - interest only (3) 69 mainland and 35 Hawaii properties 6.18% $ 1,235,000 10/9/2024 1.0 ILPT Fixed rate - interest only 186 Hawaii properties 4.31% 650,000 2/7/2029 5.4 ILPT Fixed rate - interest only 17 mainland properties 4.42% 700,000 3/9/2032 8.4 Mountain JV (4) Floating rate - interest only (5) 82 mainland properties 6.17% 1,400,000 3/9/2024 0.4 Mountain JV (4) Fixed rate - interest only Four mainland properties 6.25% 91,000 6/10/2030 6.7 Mountain JV (4) Fixed rate - amortizing One mainland property 3.67% 11,712 5/1/2031 7.6 Mountain JV (4) Fixed rate - amortizing One mainland property 4.14% 13,228 7/1/2032 8.8 Mountain JV (4) Fixed rate - amortizing One mainland property 4.02% 29,213 10/1/2033 10.0 Mountain JV (4) Fixed rate - amortizing One mainland property 4.13% 40,832 11/1/2033 10.1 Mountain JV (4) Fixed rate - amortizing One mainland property 3.10% 24,873 6/1/2035 11.7 Mountain JV (4) Fixed rate - amortizing One mainland property 2.95% 40,087 1/1/2036 12.3 Mountain JV (4) Fixed rate - amortizing One mainland property 4.27% 44,423 11/1/2037 14.1 Mountain JV (4) Fixed rate - amortizing One mainland property 3.25% 50,002 1/1/2038 14.3 Weighted average / total 5.47% $ 4,330,370 3.4 Debt Summary (dollars in thousands) As of September 30, 2023
11Q3 2023RETURN TO TABLE OF CONTENTS (1) The $1,400.0 secured floating rate loan of ILPT's consolidated joint venture matures in March 2024, subject to three, one year extension options. See pages 22-25 for further information relating to this joint venture. (2) The $1,235.0 secured floating rate loan matures in October 2024, subject to three, one year extension options. Debt Maturity Schedule (dollars in millions) As of September 30, 2023 Initial Maturity Date Pr in ci p al $1,235.0 $1,400.0 $4.4 $18.1 $18.8 $19.5 $20.2 $21.0 $671.8 $113.6 $22.4 $721.8 $63.8 Secured fixed rate debt Secured floating rate debt of consolidated joint venture Secured floating rate debt 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033+ (2) 3350 Laurel Ridge Avenue Ruskin, FL 1,017,693 Square Feet ILPT Ownership: 22% (1)
12Q3 2023RETURN TO TABLE OF CONTENTS As of and for the Three Months Ended 9/30/2023 6/30/2023 3/31/2023 12/31/2022 9/30/2022 Leverage Ratios: Net debt / total gross assets 68.5% 68.8% 69.7% 69.7% 69.9% Net debt / gross book value of real estate assets 71.7% 72.2% 72.4% 72.6% 73.1% Net debt / total market capitalization 90.9% 90.6% 92.3% 92.1% 89.5% Secured debt / total assets 76.9% 76.6% 76.0% 75.6% 75.1% Variable rate debt / net debt 64.1% 63.9% 63.7% 63.5% 63.2% Coverage Ratios: Net debt / annualized Adjusted EBITDAre 12.3x 12.7x 12.8x 13.1x 13.7x Adjusted EBITDAre / interest expense 1.1x 1.1x 1.1x 1.1x 0.8x Leverage and Coverage Ratios 900 Commerce Parkway West Drive Greenwood, IN 294,388 Square Feet ILPT Ownership: 100%
13Q3 2023RETURN TO TABLE OF CONTENTS (dollars in thousands) For the Three Months Ended 9/30/2023 6/30/2023 3/31/2023 12/31/2022 9/30/2022 Tenant improvements and leasing costs $ 1,241 $ 2,498 $ 2,040 $ 4,369 $ 2,302 Building improvements 2,720 1,283 370 2,221 1,292 Recurring capital expenditures 3,961 3,781 2,410 6,590 3,594 Development, redevelopment and other activities 1,314 3,870 2,521 1,322 4,980 Total capital expenditures $ 5,275 $ 7,651 $ 4,931 $ 7,912 $ 8,574 Capital Expenditures Summary 2552 South 98th Street Edwardsville, KS 280,019 Square Feet ILPT Ownership: 61%
14Q3 2023RETURN TO TABLE OF CONTENTS Property Acquisitions and Dispositions Dispositions: Acquisitions: ILPT has not acquired any properties since January 1, 2023. 17001 West Mercury Street Gardner, KS 645,462 Square Feet ILPT Ownership: 100% Since January 1, 2023 (dollars in thousands) ILPT has not disposed of any properties since January 1, 2023. As of October 25, 2023, one Mainland Property is under agreement to sell for a sales price of $21,500, excluding closing costs.
15Q3 2023RETURN TO TABLE OF CONTENTS Portfolio Information
16Q3 2023RETURN TO TABLE OF CONTENTS (dollars and sq. ft. in thousands) As of and for the Three Months Ended As of and for the Nine Months Ended 9/30/2023 9/30/2022 9/30/2023 9/30/2022 Properties (end of period) 409 409 285 285 Square feet 59,207 59,185 33,462 33,440 Percent leased 98.9% 99.2% 98.8% 99.3% Rental income $ 108,571 $ 101,704 $ 166,912 $ 160,004 NOI $ 84,065 $ 79,870 $ 128,881 $ 124,632 NOI % change 5.3% 3.4% Cash Basis NOI $ 80,391 $ 75,819 $ 121,333 $ 115,704 Cash Basis NOI % change 6.0% 4.9% Same Property Results 309 Dulty's Lane Burlington, NJ 633,836 Square Feet ILPT Ownership: 100%
17Q3 2023RETURN TO TABLE OF CONTENTS (dollars and sq. ft. in thousands, except per sq. ft. data) As of and for the As of and for the Three Months Ended Nine Months Ended 9/30/2023 6/30/2023 3/31/2023 12/31/2022 9/30/2022 9/30/2023 Properties 413 413 413 413 413 413 Total sq. ft. 59,983 59,983 59,983 59,983 59,962 59,983 Sq. ft. leased 59,316 59,415 59,193 59,420 59,469 59,316 Percentage leased 98.9% 99.1% 98.7% 99.1% 99.2% 98.9% Leasing Activity (Sq. Ft.): New leases 64 494 36 188 543 594 Renewals 694 1,091 1,107 1,145 1,142 2,892 Rent resets — 382 — 36 — 382 Expirations (857) (1,363) (1,370) (1,382) (1,502) (3,590) % Change in GAAP Rent: New leases -15.7% 36.5% 51.4% 20.3% 280.7% 29.9% Renewals 16.9% 25.5% 13.9% 17.8% 26.1% 18.1% Rent resets —% 29.9% —% 33.2% —% 29.9% Weighted average (by sq. ft.) 13.5% 29.6% 15.1% 18.7% 77.5% 20.8% Leasing Costs and Concession Commitments: New leases $ 140 $ 2,920 $ 160 $ 782 $ 3,570 $ 3,220 Renewals 1,301 975 1,777 4,248 992 4,053 Total $ 1,441 $ 3,895 $ 1,937 $ 5,030 $ 4,562 $ 7,273 Leasing Costs and Concession Commitments per Sq. Ft.: New leases $ 2.21 $ 5.91 $ 4.44 $ 4.16 $ 6.58 $ 5.43 Renewals $ 1.87 $ 0.89 $ 1.60 $ 3.71 $ 0.87 $ 1.40 Weighted average $ 1.90 $ 2.46 $ 1.69 $ 3.77 $ 2.71 $ 2.09 Weighted Average Lease Term by Sq. Ft. (Years): New leases 4.9 11.6 18.0 6.5 7.4 11.3 Renewals 4.0 7.7 8.6 8.2 3.7 7.2 Weighted average 4.1 8.9 8.9 8.0 4.9 7.8 Leasing Costs and Concession Commitments per Sq. Ft. per Year: New leases $ 0.45 $ 0.51 $ 0.25 $ 0.64 $ 0.89 $ 0.48 Renewals $ 0.47 $ 0.12 $ 0.19 $ 0.45 $ 0.24 $ 0.20 Weighted average $ 0.46 $ 0.28 $ 0.19 $ 0.47 $ 0.55 $ 0.27 (1) The leasing summary is based on leases entered into during the periods indicated. (2) Excludes properties owned by ILPT's unconsolidated joint venture. Occupancy and Leasing Summary (1) (2)
18Q3 2023RETURN TO TABLE OF CONTENTS As of September 30, 2023 % of Total Annualized Rental Tenant Credit Characteristics Revenues Investment grade rated 17.6% Subsidiaries of investment grade rated parent entities 38.3% Other leased Hawaii lands 21.3% Subtotal investment grade rated, subsidiaries of investment grade rated parent entities and other leased Hawaii lands 77.2% Other unrated or non-investment grade 22.8% 100.0% Tenant Credit Characteristics and Concentration 725 Darlington Avenue Mahwah, NJ 167,424 Square Feet ILPT Ownership: 100% % of Total Annualized No. of Leased % of Total Rental Tenants with 1% or More of Total Annualized Rental Revenues States Properties Sq. Ft. Leased Sq. Ft. Revenues 1 FedEx Corporation / FedEx Ground Package System, Inc. Various (34 states) 81 13,001 21.9% 29.8% 2 Amazon.com Services, Inc. / Amazon.com Services LLC AL, IN, OK, SC, TN, VA 8 4,539 7.7% 6.7% 3 Home Depot U.S.A., Inc. GA, HI 2 956 1.6% 2.1% 4 UPS Supply Chain Solutions, Inc. NH, NY 3 794 1.3% 1.6% 5 Restoration Hardware, Inc. MD 1 1,195 2.0% 1.5% 6 Servco Pacific, Inc. HI 7 629 1.1% 1.4% 7 American Tire Distributors, Inc. CO, LA, NE, NY, OH 5 722 1.2% 1.4% 8 Par Pacific Holdings Inc. HI 3 3,148 5.3% 1.2% 9 TD SYNNEX Corporation OH 2 939 1.6% 1.1% 10 Berkshire Hathaway Inc. GA 1 832 1.4% 1.0% 113 26,755 45.1% 47.8% (dollars and sq. ft. in thousands)
19Q3 2023RETURN TO TABLE OF CONTENTS Cumulative Cumulative % of Total % of Total % of Total % of Total Leased Leased Leased Annualized Annualized Annualized No. of Square Feet Square Feet Square Feet Rental Revenues Rental Revenues Rental Revenues Year Leases Expiring Expiring Expiring 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 Portfolio Lease Expiration and Reset Schedules (dollars and sq. ft. in thousands) As of September 30, 2023 5300 Centerpoint Parkway Groveport, OH 581,342 Square Feet ILPT Ownership: 100% Total 2023 2024 2025 2026 2027 2028+ Scheduled Rent Resets at Hawaii Properties: Reset sq. ft. 3,342 — 144 204 154 86 2,754 Percent (1) —% 0.9% 1.2% 0.9% 0.5% 16.8% Annualized rental revenues $ 21,854 $ — $ 1,150 $ 989 $ 1,315 $ 795 $ 17,605 Percent (1) —% 0.9% 0.8% 1.1% 0.7% 14.5% (1) Percent based on Hawaii properties leased square feet and Hawaii properties annualized rental revenues.
20Q3 2023RETURN TO TABLE OF CONTENTS (dollars and sq. ft. in thousands, except per sq. ft. data) Key Financial Data by Investment Portfolio As of and for the Three Months Ended September 30, 2023 ILPT Wholly Owned Properties Mountain Industrial ILPT Hawaii Mainland Total REIT LLC (1) Other (2) Consolidated Ownership % 100.0% 100.0% 100.0% 61.0% Properties 226 92 318 94 1 413 Sq. ft. 16,729 22,209 38,938 20,981 64 59,983 Occupancy % 97.8% 99.4% 98.7% 99.2% 98.1% 98.9% Selected Balance Sheet Data: Total gross assets $ 723,314 $ 1,862,657 $ 2,585,971 $ 3,189,957 $ 224,566 $ 6,000,494 Total debt (principal) $ 862,930 $ 1,722,070 $ 2,585,000 $ 1,745,370 $ — $ 4,330,370 Selected Income Statement Data: Rental income $ 30,898 $ 36,799 $ 67,697 $ 42,061 $ 384 $ 110,142 Net income (loss) $ 8,819 $ (20,054) $ (11,235) $ (26,248) $ 1,292 $ (36,191) Net income (loss) attributable to common shareholders $ 8,819 $ (20,054) $ (11,235) $ (16,010) $ 1,133 $ (26,112) NOI $ 22,572 $ 29,278 $ 51,850 $ 33,219 $ 240 $ 85,309 Cash Basis NOI $ 20,530 $ 29,150 $ 49,680 $ 31,729 $ 234 $ 81,643 Adjusted EBITDAre $ 21,642 $ 26,835 $ 48,477 $ 30,749 $ 3,968 $ 83,194 Normalized FFO attributable to common shareholders $ 9,547 $ (4,035) $ 5,512 $ 457 $ 1,976 $ 7,945 CAD attributable to common shareholders $ 8,863 $ 1,800 $ 10,663 $ (2,150) $ 1,992 $ 10,505 Key Ratios: Annualized Cash Basis NOI / total gross assets 11.4% 6.3% 7.7% 4.0% 5.4% Net debt / annualized Adjusted EBITDAre 10.0 x 16.0 x 13.3 x 13.1 x 12.3 x Select Quarterly Leasing Activity: Leasing activity (sq. ft.): 21 272 293 465 — 758 % change in GAAP rent (weighted average by sq. ft.): 9.9% 8.0% 8.3% 18.7% —% 13.5% Weighted average lease term by sq. ft. (years): 11.0 4.7 7.3 6.7 — 7.1 (1) With the exception of measures attributable to common shareholders, amounts shown reflect 100% ownership interest of this joint venture, not ILPT's proportionate share thereof. Amounts presented are derived from GAAP information and may not be comparable to amounts reflected in this joint venture's standalone financial information. (2) Other includes data for: 100% of the ownership interest of one consolidated mainland property containing approximately 64 rentable square feet located in New Jersey in which ILPT has a 67% ownership interest attributable to common shareholders; any corporate assets and liabilities including ILPT's equity investment in its unconsolidated joint venture; and adjustments to remove the noncontrolling interest of Mountain Industrial REIT LLC from the balance sheet and income statement data.
21Q3 2023RETURN TO TABLE OF CONTENTS Joint Ventures
22Q3 2023RETURN TO TABLE OF CONTENTS Consolidated Joint Venture - Mountain Industrial REIT LLC (dollars and sq. ft. in thousands) Investment in Joint Venture: ILPT Number of Number of Square Joint Venture Ownership Presentation Properties States Feet Mountain Industrial REIT LLC 61% Consolidated 94 27 20,981 (1) Amounts shown reflect 100% ownership interest of this joint venture, not ILPT's proportionate share thereof. Amounts presented are derived from GAAP information and may not be comparable to amounts reflected in this joint venture's standalone financial information. (2) ILPT's proportionate share of the principal amount of debt balances based on its ownership percentage of its consolidated joint venture as of September 30, 2023 is $1,064,676. None of the debt is recourse to ILPT, subject to certain limitations. As of September 30, 2023 Mountain Industrial REIT LLC Balance Sheet Information of ILPT's Consolidated Joint Venture (1) September 30, 2023 December 31, 2022 ASSETS Real estate properties $ 2,839,208 $ 2,836,538 Accumulated depreciation (124,123) (65,732) Total real estate properties, net 2,715,085 2,770,806 Acquired real estate leases, net 170,527 194,266 Cash, cash equivalents and restricted cash 136,996 87,659 Other assets, net 43,226 47,717 Total assets $ 3,065,834 $ 3,100,448 LIABILITIES Mortgage and notes payable, net (2) $ 1,737,142 $ 1,687,050 Other liabilities 44,080 38,347 Total liabilities $ 1,781,222 $ 1,725,397 Noncontrolling interest (39%) $ 500,999 $ 536,271
23Q3 2023RETURN TO TABLE OF CONTENTS Consolidated Joint Venture - Financial Information Operating Information of the Consolidated Joint Venture (100%) (1) Pro-Rata Operating Information of the Consolidated Joint Venture (ILPT Share) (2) Three Months Ended September 30, Nine Months Ended September 30, Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 2023 2022 2023 2022 Mountain Industrial REIT LLC Rental income $ 42,061 $ 39,425 $ 126,334 $ 93,433 $ 25,657 $ 24,049 $ 77,064 $ 56,993 Real estate taxes 5,348 4,501 18,347 10,545 3,262 2,746 11,191 6,433 Other operating expenses 3,494 2,880 9,371 6,619 2,131 1,757 5,716 4,038 Depreciation and amortization 26,995 29,035 81,920 69,855 16,467 17,711 49,972 42,611 General and administrative 4,025 4,155 12,143 9,757 2,455 2,535 7,407 5,953 Total expenses 39,862 40,571 121,781 96,776 24,315 24,749 74,286 59,035 Interest and other income 1,555 6 3,370 6 949 4 2,056 4 Interest expense (29,977) (97,094) (87,646) (123,160) (18,286) (59,227) (53,464) (75,127) Loss on sale of real estate — — (974) — — — (594) — Loss before income tax expense and equity in earnings of unconsolidated joint venture (26,223) (98,234) (80,697) (126,497) (15,995) (59,923) (49,224) (77,165) Loss on early extinguishment of debt — — (359) — — — (219) — Income tax expense (25) (18) (73) (66) (15) (11) (44) (40) Net loss $ (26,248) $ (98,252) $ (81,129) $ (126,563) $ (16,010) $ (59,934) $ (49,487) $ (77,205) Net loss $ (26,248) $ (98,252) $ (81,129) $ (126,563) $ (16,010) $ (59,934) $ (49,487) $ (77,205) Plus: depreciation and amortization 26,995 29,035 81,920 69,855 16,467 17,711 49,972 42,611 Plus: loss on sale of real estate — — 974 — — — 594 — Funds from Operations 747 (69,217) 1,765 (56,708) 457 (42,223) 1,079 (34,594) Plus: loss on early extinguishment of debt — — 359 — — — 219 — Plus: acquisition, transaction related and certain other financing costs (3) — 72,766 — 72,766 — 44,387 — 44,387 Normalized Funds from Operations $ 747 $ 3,549 $ 2,124 $ 16,058 $ 457 $ 2,164 $ 1,298 $ 9,793 (dollars in thousands, except percentage data and per share data) (1) Amounts shown reflect 100% ownership interest of this joint venture, not ILPT's proportionate share thereof. Amounts presented are derived from GAAP information and may not be comparable to amounts reflected in this joint venture's standalone financial information. (2) See page 31 for more information regarding Pro-Rata Operating Information of Consolidated Joint Venture. (3) Amounts for the three and nine months ended September 30, 2022 primarily represent debt issuance costs recorded as interest expense related to certain financing and other transaction related costs expensed under GAAP.
24Q3 2023RETURN TO TABLE OF CONTENTS Consolidated Joint Venture - Financial Information (Continued) Operating Information of the Consolidated Joint Venture (100%) (1) Pro-Rata Operating Information of the Consolidated Joint Venture (ILPT Share) (2) Three Months Ended September 30, Nine Months Ended September 30, Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 2023 2022 2023 2022 Mountain Industrial REIT LLC Normalized Funds from Operations $ 747 $ 3,549 $ 2,124 $ 16,058 $ 457 $ 2,164 $ 1,298 $ 9,793 Plus: Amortization of debt issuance costs 4,156 3,950 12,409 9,878 2,535 2,410 7,569 6,026 Minus: Lease value amortization (1,490) (1,586) (3,794) (3,332) (909) (967) (2,314) (2,032) Minus: Recurring capital expenditures (2,554) (940) (6,256) (2,137) (1,558) (573) (3,816) (1,303) Minus: Principal amortization (4,385) (5,429) (15,083) (12,590) (2,675) (3,312) (9,201) (7,680) CAD $ (3,526) $ (456) $ (10,600) $ 7,877 $ (2,150) $ (278) $ (6,464) $ 4,804 Net loss $ (26,248) $ (98,252) $ (81,129) $ (126,563) $ (16,010) $ (59,934) $ (49,487) $ (77,205) Plus: interest expense 29,977 97,094 87,646 123,160 18,286 59,227 53,464 75,127 Plus: income tax expense 25 18 73 66 15 11 44 40 Plus: depreciation and amortization 26,995 29,035 81,920 69,855 16,467 17,711 49,972 42,611 EBITDA 30,749 27,895 88,510 66,518 18,758 17,015 53,993 40,573 Plus: loss on sale of real estate — — 974 — — — 594 — EBITDAre 30,749 27,895 89,484 66,518 18,758 17,015 54,587 40,573 Plus: loss on early extinguishment of debt — — 359 — — — 219 — Adjusted EBITDAre $ 30,749 $ 27,895 $ 89,843 $ 66,518 $ 18,758 $ 17,015 $ 54,806 $ 40,573 (dollars in thousands, except percentage data and per share data) (1) Amounts shown reflect 100% ownership interest of this joint venture, not ILPT's proportionate share thereof. Amounts presented are derived from GAAP information and may not be comparable to amounts reflected in this joint venture's standalone financial information. (2) See page 31 for more information regarding Pro-Rata Operating Information of Consolidated Joint Venture.
25Q3 2023RETURN TO TABLE OF CONTENTS GA: 12.0% OH: 11.0% TX: 10.2% IN: 8.4% NC: 5.9% FL: 5.0%MI: 4.6% NJ: 3.9% IL: 3.9% KS: 3.6% MS: 3.5% 16 Other States: 28.0% Consolidated Joint Venture - Portfolio Information (dollars in thousands) Number of Leases Expiring — 3 8 11 13 7 40 % of Total Annualized Rental Revenues Expiring —% 1.7% 8.2% 6.1% 13.3% 10.3% 60.4% A nn ua liz ed R ev en ue E xp ir in g Q4 2023 2024 2025 2026 2027 2028 2029+ $0 $10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 $80,000 $90,000 $100,000 Lease Expiration Schedule As of September 30, 2023 Major Tenants % of Annualized Rental Tenant Revenues FedEx Corporation / FedEx Ground Package System, Inc. 57.0% Amazon.com Services, Inc. / Amazon.com Services LLC 7.0% Home Depot U.S.A., Inc. 3.7% Berkshire Hathaway Inc. 2.7% Techtronic Industries Company Limited 2.5% Ulta Beauty, Inc. 2.4% Autoneum Holding AG 2.4% Geographic Diversification (1) (1) Based on the aggregate annualized rental revenues of ILPT's consolidated joint venture as of September 30, 2023.
26Q3 2023RETURN TO TABLE OF CONTENTS Unconsolidated Joint Venture - The Industrial Fund REIT LLC (1) As of September 30, 2023 ILPT Number of Square Investment in Joint Venture Ownership Properties States Feet Joint Venture The Industrial Fund REIT LLC 22% 18 12 11,726 $ 124,411 Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Rental income $ 17,781 $ 16,718 $ 52,333 $ 50,744 Real estate taxes 2,606 2,381 7,614 7,275 Other operating expenses 2,000 2,098 5,922 6,458 Depreciation and amortization 7,921 8,289 24,171 24,942 General and administrative 988 949 2,794 2,831 Total expenses 13,515 13,717 40,501 41,506 Interest and other income 196 (4) 411 (12) Interest expense (5,805) (3,665) (16,327) (10,899) Loss before income tax expense (1,343) (668) (4,084) (1,673) Income tax expense (5) (10) (14) (31) Net loss $ (1,348) $ (678) $ (4,098) $ (1,704) Distributions received (2) $ 5,390 $ 1,320 $ 7,370 $ 3,962 Secured Debt Interest Rate Maturity Date Principal Balance Mortgage notes payable (secured by one property in Florida) (3) (4) 3.60% 10/1/2023 $ 56,980 Mortgage notes payable (secured by six properties in four states) (5) 5.30% 10/1/2027 123,700 Mortgage notes payable (secured by 11 properties in eight states) (3) 3.33% 11/7/2029 350,000 Weighted average / total 3.82% $ 530,680 (1) Amounts shown in the income statement and secured debt table reflect 100% ownership interest of this joint venture, not ILPT's proportionate share thereof. (2) Includes distribution of proceeds from this joint venture's financing activities. (3) The mortgage notes payable require interest only payments until their respective maturity dates. (4) This joint venture expects to refinance the $56,980 mortgage debt to a $65,000 five-year, interest only loan with a fixed rate of 6.96% in the fourth quarter of 2023. (5) The $123,700 interest only floating rate loan requires that interest be paid at an annual rate of SOFR plus a premium of 1.80% through October 1, 2027. The Industrial Fund REIT LLC has purchased an interest rate cap through October 2025 with a SOFR strike rate equal to 3.50%. (dollars and sq. ft. in thousands)
27Q3 2023RETURN TO TABLE OF CONTENTS Appendix
28Q3 2023RETURN TO TABLE OF CONTENTS Company Profile and Research Coverage The Company: Industrial Logistics Properties Trust (Nasdaq: ILPT) is a REIT that owns and leases industrial and logistics properties throughout the United States. ILPT is included in 112 market indices and comprises more than 1% of the following indices as of September 30, 2023: Invesco S&P SmallCap High Dividend Low Volatility ETF INAV Index (XSHDIV), Bloomberg US Micro Cap Real Estate Price Return Index (BMICR), Bloomberg Real Estate Investment Trust Small Cap Index (BBRESMLC) and Invesco KBW Premium Yield Equity REIT ETF INAV Index (KBWYIV). Management: ILPT is managed by The RMR Group (Nasdaq: RMR). RMR is an alternative asset management company that is focused on commercial real estate and related businesses. As of September 30, 2023, RMR had approximately $36 billion in assets under management and the combined RMR managed companies had more than $5 billion of annual revenues, over 2,000 properties and over 20,000 employees. ILPT believes that being managed by RMR is a competitive advantage for ILPT because of RMR’s depth of management and experience in the real estate industry. ILPT also believes RMR provides management services to it at a lower cost than it would have to pay for similar quality services if it were self managed. Equity Research Coverage B. Riley Securities, Inc. BTIG Bryan Maher Thomas Catherwood bmaher@brileyfin.com tcatherwood@btig.com (646) 885-5423 (212) 738-6140 JMP Securities RBC Capital Markets Mitchell Germain Michael Carroll mgermain@jmpsecurities.com michael.carroll@rbccm.com (212) 906-3537 (440) 715-2649 ILPT is followed by the analysts listed on this page. Please note that any opinions, estimates or forecasts regarding ILPT’s performance made by these analysts do not represent opinions, forecasts or predictions of ILPT or its management. ILPT does not by its reference above imply its endorsement of or concurrence with any information, conclusions or recommendations provided by any of these analysts.
29Q3 2023RETURN TO TABLE OF CONTENTS Governance Information Board of Trustees Bruce M. Gans Lisa Harris Jones Matthew P. Jordan Lead Independent Trustee Independent Trustee Managing Trustee Joseph L. Morea Kevin C. Phelan Adam D. Portnoy Independent Trustee Independent Trustee Chair of the Board & Managing Trustee June S. Youngs Independent Trustee Executive Officers Yael Duffy Tiffany R. Sy President and Chief Operating Officer Chief Financial Officer and Treasurer 13509 Waterworks Street Jacksonville, FL 304,859 Square Feet ILPT Ownership: 100%
30Q3 2023RETURN TO TABLE OF CONTENTS Unless otherwise noted, all data presented in this presentation excludes 18 properties, which are encumbered by $530.7 million of mortgage notes, owned by an unconsolidated joint venture in which ILPT owns a 22% equity interest. See page 26 for information regarding this joint venture and related mortgage notes. Non-GAAP Financial Measures: ILPT presents certain “non-GAAP financial measures” within the meaning of the applicable rules of the Securities and Exchange Commission, or the SEC, including FFO attributable to common shareholders, Normalized FFO attributable to common shareholders, EBITDA, EBITDAre, Adjusted EBITDAre, NOI, same property NOI, Cash Basis NOI and same property Cash Basis NOI. 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 ILPT's operating performance or as measures of its liquidity. These measures should be considered in conjunction with net loss and net loss attributable to common shareholders as presented in ILPT's condensed consolidated statements of income (loss). ILPT considers 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. ILPT believes 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 its operating performance between periods and with other REITs and, in the case of NOI and Cash Basis 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 ILPT's properties. NOI and Cash Basis NOI: The calculations of net operating income, or NOI, and Cash Basis NOI exclude certain components of net loss in order to provide results that are more closely related to ILPT's property level results of operations. ILPT calculates NOI and Cash Basis NOI as shown on page 33 and same property NOI and same property Cash Basis NOI as shown on page 34. ILPT defines NOI as income from its rental of real estate less its property operating expenses. NOI excludes amortization of capitalized tenant improvement costs and leasing commissions that it records as depreciation and amortization expense. ILPT defines Cash Basis NOI as NOI excluding non-cash straight line rent adjustments, lease value amortization and lease termination fees, if any. ILPT uses NOI and Cash Basis NOI to evaluate individual and company-wide property level performance. ILPT calculates same property NOI and same property Cash Basis NOI in the same manner that it calculates the corresponding NOI and Cash Basis NOI amounts, except that ILPT only includes same properties in calculating same property NOI and same property Cash Basis NOI. Other real estate companies and REITs may calculate NOI and Cash Basis NOI differently than ILPT does. FFO and Normalized FFO Attributable to Common Shareholders: ILPT calculates funds from operations, or FFO, attributable to common shareholders and normalized funds from operations, or Normalized FFO, attributable to common shareholders as shown on page 36. FFO attributable to common shareholders is calculated on the basis defined by The National Association of Real Estate Investment Trusts, or Nareit, 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 ILPT's 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 ILPT. In calculating Normalized FFO attributable to common shareholders, ILPT adjusts for the items shown on page 36 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 ILPT's Board of Trustees when determining the amount of distributions to its shareholders. Other factors include, but are not limited to, requirements to maintain ILPT's qualification for taxation as a REIT, limitations in the agreements governing its debt, the availability to ILPT of debt and equity capital, its distribution rate as a percentage of the trading price of ILPT's common shares, or dividend yield, and ILPT's dividend yield compared to the dividend yields of other industrial REITs, ILPT's expectation of its future capital requirements and operating performance and its expected needs for and availability of cash to pay its obligations. Other real estate companies and REITs may calculate FFO attributable to common shareholders and Normalized FFO attributable to common shareholders differently than ILPT does. Non-GAAP Financial Measures and Certain Definitions
31Q3 2023RETURN TO TABLE OF CONTENTS Non-GAAP Financial Measures and Certain Definitions (Continued) Cash Available for Distribution: ILPT calculates cash available for distribution, or CAD, as shown on page 37. ILPT defines CAD as Normalized FFO minus ILPT's proportionate share of Normalized FFO of unconsolidated joint venture properties, plus operating cash flow distributions received from ILPT's unconsolidated joint venture, recurring real estate related capital expenditures, adjustments for other non-cash and nonrecurring items, certain amounts excluded from Normalized FFO but settled in cash, less CAD adjustments attributable to noncontrolling interest, as well as certain other adjustments currently not applicable to ILPT. CAD is among the factors considered by ILPT's Board of Trustees when determining the amount of distributions to ILPT's shareholders. Other real estate companies and REITs may calculate CAD differently than ILPT does. EBITDA, EBITDAre and Adjusted EBITDAre: ILPT calculates earnings before interest, taxes, depreciation and amortization, or EBITDA, EBITDA for real estate, or EBITDAre, and Adjusted EBITDAre as shown on page 35. EBITDAre is calculated on the basis defined by Nareit, which is EBITDA, including ILPT's proportionate share of EBITDAre from unconsolidated joint venture properties, and excluding gains and losses on the sale of real estate, equity in earnings of unconsolidated joint venture, loss on impairment of real estate, any realized and unrealized gains or losses on equity securities, as well as certain other adjustments currently not applicable to ILPT. In calculating Adjusted EBITDAre, ILPT adjusts for the items shown on page 35. Other real estate companies and REITs may calculate EBITDA, EBITDAre and Adjusted EBITDAre differently than ILPT does. Pro-Rata Operating Information of Consolidated Joint Venture: ILPT believes this financial presentation of its joint venture information provides useful information to investors by providing additional insight into the financial performance of its consolidated joint venture, in which ILPT owns a 61% equity interest. This information may not accurately depict the impact of these investments in accordance with GAAP. Pro-rata information should not be considered in isolation or as a substitute for ILPT's condensed consolidated financial statements in accordance with GAAP. Certain Definitions: Annualized dividend yield - Annualized dividend yield is the annualized dividend paid during the applicable period divided by the closing price of ILPT's common shares at the end of the relevant period. Annualized rental revenues - Annualized rental revenues is the annualized contractual base rents from ILPT's tenants pursuant to its lease agreements as of the measurement date, including straight line rent adjustments and estimated recurring expense reimbursements to be paid to ILPT, and excluding lease value amortization. Building improvements - Building improvements generally include (i) expenditures to replace obsolete building components and (ii) expenditures that extend the useful life of existing assets. Development, redevelopment and other activities - Development, redevelopment and other activities generally include capital expenditures projects that (i) reposition a property or (ii) result in new sources of revenue. GAAP - GAAP is the U.S. generally accepted accounting principles. Gross book value of real estate assets - Gross book value of real estate assets is real estate assets at cost, plus certain acquisition related costs, if any, before depreciation and purchase price allocations, less impairment writedowns, if any.
32Q3 2023RETURN TO TABLE OF CONTENTS ILPT Ownership - References to ILPT's percentage ownership of properties owned by its joint ventures reflect ILPT's ownership percentage of the joint venture. ILPT Wholly Owned Properties - ILPT Wholly Owned Properties is comprised of 318 properties that are wholly owned by ILPT, including 226 buildings, leasable land parcels and easements containing approximately 16.7 million rentable square feet that are primarily industrial lands located on the island of Oahu, HI, or the Hawaii Portfolio, and 92 properties containing approximately 22.2 million rentable square feet located in 34 other states, or the Mainland Portfolio. Information included in this presentation with respect to the Mainland Portfolio and the Hawaii Portfolio include certain allocations of interest expense on debts secured by properties in each portfolio and of general and administrative expense based upon gross asset value of properties in each portfolio. ILPT believes the information presented for these portfolios is useful to investors to provide insight into the financial performance of these portfolios. Leased square feet - 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. Leasing costs - Leasing costs include leasing related costs, such as brokerage commissions and tenant inducements. Leasing costs and concession commitments - Leasing costs and concession commitments include commitments made for leasing expenditures and concessions, such as tenant improvements, leasing commissions, tenant reimbursements and free rent. Mountain Industrial REIT LLC - Mountain Industrial REIT LLC, or Mountain JV, owns 94 mainland properties containing approximately 21.0 million rentable square feet located in 27 states. ILPT owns a 61% equity interest in this joint venture. ILPT consolidates 100% of this joint venture in its financial statements in accordance with GAAP. Net debt - Net debt is the total outstanding principal of ILPT's debt less cash and restricted cash. Non-cash interest expense - Non-cash interest expense includes the amortization of debt discounts premiums, issuance costs and interest rate caps. Percent change in GAAP rent - Percent change in GAAP rent is the percent change from prior rents charged for same space. Rents include estimated recurring expense reimbursements and exclude lease value amortization. Same space represents the same land area and building area (with leasing rates for vacant space based upon the most recent rental rate for the same space). Rolling four quarter CAD - Represents CAD for the preceding twelve month period as of the respective quarter end date. Same property - For the three months ended September 30, 2023 and 2022, same property NOI and Cash Basis NOI are based on properties that ILPT owned as of September 30, 2023 and that it owned continuously since July 1, 2022, and exclude three properties classified as held for sale as of September 30, 2023 and properties owned by an unconsolidated joint venture. For the nine months ended September 30, 2023 and 2022, same property NOI and Cash Basis NOI are based on properties that ILPT owned as of September 30, 2023 and that it owned continuously since January 1, 2022, and exclude three properties classified as held for sale as of September 30, 2023 and properties owned by an unconsolidated joint venture. Square feet - Subject to modest adjustments when space is remeasured or reconfigured for new tenants or when land leases are converted to building leases. Tenant improvements - Tenant improvements include capital expenditures used to improve tenants' space or amounts paid directly to tenants to improve their space. Total gross assets - Total gross assets is total assets plus accumulated depreciation. Total market capitalization - Total market capitalization is total debt plus the market value of ILPT's common shares at the end of the applicable period. Non-GAAP Financial Measures and Certain Definitions (Continued)
33Q3 2023RETURN TO TABLE OF CONTENTS Calculation and Reconciliation of NOI and Cash Basis NOI (dollars in thousands) For the Three Months Ended For the Nine Months Ended 9/30/2023 6/30/2023 3/31/2023 12/31/2022 9/30/2022 9/30/2023 9/30/2022 Calculation of NOI and Cash Basis NOI: Rental income $ 110,142 $ 108,043 $ 110,258 $ 106,339 $ 103,215 $ 328,443 $ 281,812 Real estate taxes (14,926) (15,100) (16,467) (14,164) (13,749) (46,493) (36,460) Other operating expenses (9,907) (8,519) (9,318) (8,577) (8,453) (27,744) (22,278) NOI 85,309 84,424 84,473 83,598 81,013 254,206 223,074 Non-cash straight line rent adjustments included in rental income (3,414) (3,355) (3,762) (3,368) (3,794) (10,531) (8,170) Lease value amortization included in rental income (252) (242) (270) (279) (250) (764) (4,265) Lease termination fees included in rental income — — — (20) — — (30) Cash Basis NOI $ 81,643 $ 80,827 $ 80,441 $ 79,931 $ 76,969 $ 242,911 $ 210,609 Reconciliation of net loss to NOI and Cash Basis NOI: Net loss $ (36,191) $ (36,580) $ (35,546) $ (41,759) $ (83,974) $ (108,317) $ (245,082) Equity in earnings of unconsolidated joint venture (719) (2,743) (3,961) (444) (3,297) (7,423) (6,634) Income tax expense (benefit) 51 45 17 (68) 28 113 113 Loss before income tax expense (benefit) and equity in earnings of unconsolidated joint venture (36,859) (39,278) (39,490) (42,271) (87,243) (115,627) (251,603) Loss on early extinguishment of debt — 359 — — 21,370 359 22,198 Interest and other income (2,397) (1,797) (1,146) (763) (1,068) (5,340) (1,900) Interest expense 72,941 71,846 70,771 71,765 89,739 215,558 208,286 Loss on sale of real estate — — 974 — — 974 10 Loss on equity securities — — — — — — 5,758 General and administrative 7,712 8,131 7,907 7,981 9,110 23,750 24,896 Acquisition and other transaction related costs — — — — 586 — 586 Loss on impairment of real estate — 254 — — — 254 100,747 Depreciation and amortization 43,912 44,909 45,457 46,886 48,519 134,278 114,096 NOI 85,309 84,424 84,473 83,598 81,013 254,206 223,074 Non-cash straight line rent adjustments included in rental income (3,414) (3,355) (3,762) (3,368) (3,794) (10,531) (8,170) Lease value amortization included in rental income (252) (242) (270) (279) (250) (764) (4,265) Lease termination fees included in rental income — — — (20) — — (30) Cash Basis NOI $ 81,643 $ 80,827 $ 80,441 $ 79,931 $ 76,969 $ 242,911 $ 210,609 158 West Yard Road Feura Bush, NY 354,000 Square Feet ILPT Ownership: 100%
34Q3 2023RETURN TO TABLE OF CONTENTS Reconciliation of NOI to Same Property NOI and Calculation of Same Property Cash Basis NOI (dollars in thousands) For the Three Months Ended September 30, For the Nine Months Ended September 30, 2023 2022 2023 2022 Reconciliation of NOI to Same Property NOI: Rental income $ 110,142 $ 103,215 $ 328,443 $ 281,812 Real estate taxes (14,926) (13,749) (46,493) (36,460) Other operating expenses (9,907) (8,453) (27,744) (22,278) NOI 85,309 81,013 254,206 223,074 Less: NOI of properties not included in same property results (1,244) (1,143) (125,325) (98,442) Same property NOI $ 84,065 $ 79,870 $ 128,881 $ 124,632 Calculation of Same Property Cash Basis NOI: Same property NOI $ 84,065 $ 79,870 $ 128,881 $ 124,632 Less: Non-cash straight line rent adjustments included in rental income (3,422) (3,802) (7,140) (4,908) Lease value amortization included in rental income (252) (249) (408) (3,990) Lease termination fees included in rental income — — — (30) Same property Cash Basis NOI $ 80,391 $ 75,819 $ 121,333 $ 115,704 2020 Joe B. Jackson Parkway Murfreesboro, TN 1,016,281 Square Feet ILPT Ownership: 100%
35Q3 2023RETURN TO TABLE OF CONTENTS Calculation of EBITDA, EBITDAre and Adjusted EBITDAre (dollars in thousands) For the Three Months Ended For the Nine Months Ended 9/30/2023 6/30/2023 3/31/2023 12/31/2022 9/30/2022 9/30/2023 9/30/2022 Net loss $ (36,191) $ (36,580) $ (35,546) $ (41,759) $ (83,974) $ (108,317) $ (245,082) Plus: interest expense 72,941 71,846 70,771 71,765 89,739 215,558 208,286 Plus: income tax expense (benefit) 51 45 17 (68) 28 113 113 Plus: depreciation and amortization 43,912 44,909 45,457 46,886 48,519 134,278 114,096 EBITDA 80,713 80,220 80,699 76,824 54,312 241,632 77,413 Loss on impairment of real estate — 254 — — — 254 100,747 Loss on sale of real estate — — 974 — — 974 10 Equity in earnings of unconsolidated joint venture (719) (2,743) (3,961) (444) (3,297) (7,423) (6,634) Share of EBITDAre from unconsolidated joint venture 2,724 2,674 2,613 2,432 2,483 8,011 7,517 Loss on equity securities — — — — — — 5,758 EBITDAre 82,718 80,405 80,325 78,812 53,498 243,448 184,811 Plus: acquisition and other transaction related costs — — — — 586 — 586 Plus: general and administrative expense paid in common shares (1) 476 567 387 401 618 1,430 1,820 Plus: loss on early extinguishment of debt — 359 — — 21,370 359 22,198 Adjusted EBITDAre $ 83,194 $ 81,331 $ 80,712 $ 79,213 $ 76,072 $ 245,237 $ 209,415 (1) Amounts represent equity based compensation to ILPT's trustees and officers and certain other employees of RMR.
36Q3 2023RETURN TO TABLE OF CONTENTS Calculation of FFO, Normalized FFO and CAD (dollars and shares in thousands, except per share data) For the Three Months Ended For the Nine Months Ended 9/30/2023 6/30/2023 3/31/2023 12/31/2022 9/30/2022 9/30/2023 9/30/2022 Net loss attributable to common shareholders $ (26,112) $ (25,828) $ (24,809) $ (31,043) $ (45,627) $ (76,749) $ (195,680) Depreciation and amortization 43,912 44,909 45,457 46,886 48,519 134,278 114,096 Equity in earnings of unconsolidated joint venture (719) (2,743) (3,961) (444) (3,297) (7,423) (6,634) Loss on equity securities — — — — — — 5,758 Share of Normalized FFO from unconsolidated joint venture 1,446 1,502 1,468 1,291 1,678 4,416 5,115 Loss on impairment of real estate — 254 — — — 254 100,747 Loss on sale of real estate — — 974 — — 974 10 FFO adjustments attributable to noncontrolling interest (10,582) (10,719) (11,213) (11,250) (11,407) (32,514) (27,445) FFO attributable to common shareholders 7,945 7,375 7,916 5,440 (10,134) 23,236 (4,033) Loss on early extinguishment of debt — 359 — — 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 — (140) — — (28,379) (140) (28,379) Normalized FFO attributable to common shareholders $ 7,945 $ 7,594 $ 7,916 $ 5,440 $ 14,873 $ 23,455 $ 70,778 (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.
37Q3 2023RETURN TO TABLE OF CONTENTS (dollars and shares in thousands, except per share data) For the Three Months Ended For the Nine Months Ended 9/30/2023 6/30/2023 3/31/2023 12/31/2022 9/30/2022 9/30/2023 9/30/2022 Normalized FFO attributable to common shareholders $ 7,945 $ 7,594 $ 7,916 $ 5,440 $ 14,873 $ 23,455 $ 70,778 Plus (minus): Non-cash interest expense 12,884 12,861 12,853 13,123 4,658 38,598 11,368 Non-cash revenues (3,666) (3,597) (4,032) (3,647) (4,044) (11,295) (12,435) Non-cash expenses 476 567 387 401 618 1,430 1,820 Recurring capital expenditures (3,961) (3,781) (2,410) (6,590) (3,594) (10,152) (10,068) Principal amortization (4,385) (5,168) (5,530) (5,479) (5,429) (15,083) (12,590) Share of Normalized FFO from unconsolidated joint venture (1,446) (1,502) (1,468) (1,291) (1,678) (4,416) (5,115) Distributions from unconsolidated joint venture 990 990 990 1,320 1,320 2,970 3,962 CAD adjustments attributable to noncontrolling interest 1,668 1,839 1,476 1,471 1,566 4,983 3,207 CAD attributable to common shareholders $ 10,505 $ 9,803 $ 10,182 $ 4,748 $ 8,290 $ 30,490 $ 50,927 Weighted average common shares outstanding (basic and diluted) 65,488 65,369 65,309 65,307 65,250 65,389 65,228 Per Common Share Data (basic and diluted): Net loss attributable to common shareholders $ (0.40) $ (0.40) $ (0.38) $ (0.48) $ (0.70) $ (1.17) $ (3.00) FFO attributable to common shareholders $ 0.12 $ 0.11 $ 0.12 $ 0.08 $ (0.16) $ 0.36 $ (0.06) Normalized FFO attributable to common shareholders $ 0.12 $ 0.12 $ 0.12 $ 0.08 $ 0.23 $ 0.36 $ 1.09 CAD attributable to common shareholders $ 0.16 $ 0.15 $ 0.16 $ 0.07 $ 0.13 $ 0.47 $ 0.78 Calculation of FFO, Normalized FFO and CAD (Continued)
38Q3 2023RETURN TO TABLE OF CONTENTS Warning Concerning Forward-Looking Statements This presentation 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: growth in ILPT’s performance; demand for ILPT’s properties; quality and retention of ILPT’s tenants; debt maturities; operational synergies; opportunities ILPT believes exist for its portfolio and rent growth; ILPT’s disposition activities; an implied assumption that ILPT and/or ILPT's Mountain JV will exercise their options to extend the maturity date of their respective loans; ILPT’s capital expenditure plans and commitments; and the unconsolidated joint venture's expectation to refinance its mortgage debt. Forward-looking statements reflect ILPT’s current expectations, are based on judgments and assumptions, are inherently uncertain and are subject to risks, uncertainties and other factors, which could cause ILPT’s 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 its 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; ILPT’s ability and the ability of its 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; ILPT’s ability to successfully compete for tenancies, the likelihood that the rents it realizes will increase when ILPT renews or extends its leases, enters new leases, or its rents reset at ILPT’s properties in Hawaii; whether ILPT’s tenants will renew or extend their leases or that ILPT will be able to obtain replacement tenants on terms as favorable to it as the terms of its existing leases; ILPT’s ability to maintain high occupancy at its properties; ILPT’s tenant and geographic concentrations; ILPT’s ability to reduce its leverage, generate cash flow and take advantage of mark-to-market leasing opportunities; ILPT’s ability to cost-effectively raise and balance its use of debt or equity capital; ILPT’s ability to purchase cost effective interest rate caps; ILPT’s ability to pay interest on and principal of its debt; ILPT’s ability to maintain sufficient liquidity; non-performance by the counterparties to its interest rate caps and the costs for renewing or replacing the interest rate caps; ILPT’s tenants’ ability and willingness to pay their rent obligations to ILPT; the credit qualities of ILPT’s tenants; changes in the security of cash flows from ILPT’s properties; potential defaults of its leases by its tenants; changes in global supply chain conditions and emerging technologies; whether the industrial and logistics sector and the extent to which ILPT’s tenants’ businesses are critical to sustaining a resilient supply chain and that ILPT’s business will benefit as a result; 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 ILPT’s control; ILPT’s ability to pay distributions to its shareholders and to increase or sustain the amount of such distributions; ILPT’s ability to sell properties at prices it targets; ILPT’s ability to complete pending sales without delay, or at all, at existing agreement terms; ILPT’s ability to prudently pursue, and successfully and profitably complete, expansion and renovation projects at its properties and to realize its expected returns on those projects; ILPT’s expected capital expenditures and leasing costs, as well as risks and uncertainties regarding the development, redevelopment or repositioning of ILPT’s properties, including as a result of inflation, cost overruns, supply chain challenges, labor shortages, construction delays or inability to obtain necessary permits, and ILPT’s ability to lease space at these properties at targeted returns; ILPT’s ability to sell additional equity interests in, or contribute additional properties to, its existing joint ventures, or enter into additional, real estate joint ventures or to attract co-venturers and benefit from its existing joint ventures or any real estate joint ventures ILPT may enter into; the ability of ILPT’s manager, RMR, to successfully manage it; changes in environmental laws or in their interpretations or enforcement as a result of climate change or otherwise, or ILPT’s 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 ILPT’s 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 ILPT’s business and its ability to satisfy complex rules in order for ILPT to maintain its qualification for taxation as a REIT for U.S. federal income tax purposes; actual and potential conflicts of interest with ILPT’s related parties, including its managing trustees, RMR and others affiliated with them; ILPT’s ability to acquire properties that realize ILPT’s 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 ILPT’s periodic filings. The information contained elsewhere in ILPT’s filings with the SEC, including under the caption “Risk Factors” in ILPT’s periodic reports, or incorporated therein, identifies important factors that could cause differences from ILPT’s forward-looking statements in this presentation. ILPT’s filings with the SEC are available on the SEC’s website at www.sec.gov. You should not place undue reliance upon ILPT’s forward-looking statements. Except as required by law, ILPT does not intend to update or change any forward-looking statements as a result of new information, future events or otherwise.
