The accompanying condensed consolidated financial statements of Office Properties Income Trust and its subsidiaries, or OPI, we, us or our, are unaudited. Certain information and disclosures required by U.S. generally accepted accounting principles, or GAAP, for complete financial statements have been condensed or omitted. We believe the disclosures made are adequate to make the information presented not misleading. However, the accompanying condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes contained in our Annual Report on Form 10-K for the year ended December 31, 2022,2023, or our 20222023 Annual Report. In the opinion of management, all adjustments, consisting of normal recurring accruals considered necessary for a fair statement of results for the interim period have been included. All intercompany transactions and balances with or among our consolidated subsidiaries have been eliminated. Our operating results for interim periods are not necessarily indicative of the results that may be expected for the full year.

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

As of June 30, 2023,March 31, 2024, our wholly owned properties were comprised of 155151 properties containing approximately 20,784,00020,293,000 rentable square feet, with an undepreciated carrying value of $4,050,183,$4,091,230, including $14,630$11,979 classified as held for sale. We also had noncontrolling ownership interests of 51% and 50% in two unconsolidated joint ventures that ownowned three properties containing approximately 444,000471,000 rentable square feet. We generally lease space at our properties on a gross lease, modified gross lease or net lease basis pursuant to fixed term contracts expiring between 20232024 and 2053. Some of our leases generally require us to pay all or some property operating expenses and to provide all or most property management services. During the three months ended June 30, 2023,March 31, 2024, we entered into 2313 leases for approximately 713,000488,000 rentable square feet for a weighted (by rentable square feet) average lease term of 10.39.3 years, and we made commitments of $40,638$10,977 for leasing related costs. During the six months ended June 30, 2023, we entered into 39 leases for approximately 916,000 rentable square feet for a weighted

We regularly evaluate whether events or changes in circumstances have occurred that could indicate an impairment in the value of long lived assets. Impairment indicators may include declining tenant occupancy, lack of progress releasingre-leasing vacant space, tenant bankruptcies, low long term prospects for improvement in property performance, weak or declining tenant profitability, cash flow or liquidity, our decision to dispose of an asset before the end of its estimated useful life and legislative, market or industry changes that could permanently reduce the value of a property. If there is an indication that the carrying value of an asset is not recoverable, we estimate the projected undiscounted cash flows to determine if an impairment loss should be recognized. The future net undiscounted cash flows are subjective and are based in part on assumptions regarding hold periods, market rents and terminal capitalization rates. We determine the amount of any impairment loss by comparing the historical carrying value to estimated fair value. We estimate fair value through an evaluation of recent financial performance and projected discounted cash flows using standard industry valuation techniques. In addition to consideration of impairment upon the events or changes in circumstances described above, we regularly evaluate the remaining useful lives of our long lived assets. If we change our estimate of the remaining useful lives, we allocate the carrying value of the affected assets over their revised remaining useful lives.

During the sixthree months ended June 30, 2023,March 31, 2024, we sold five propertiesone property containing approximately 296,000248,000 rentable square feet for an aggregatea sales price of $13,075,$38,500, excluding closing costs.costs, and recognized a $2,384 loss on sale of real estate. The salessale of these properties, as presented in the table below, dothis property does not represent significant dispositions individually or in the aggregate, nor do they represent a strategic shift in our business. As a result, the results of operations of these propertiesthis property are included in continuing operations through the date of sale in our condensed consolidated statements of comprehensive income (loss).

We ownAs of March 31, 2024, we owned interests in two joint ventures that ownowned three properties. We accountaccounted for these investments under the equity method of accounting. As of June 30, 2023March 31, 2024 and December 31, 2022,2023, our investments in unconsolidated joint ventures consisted of the following:

As of March 31, 2024, the same interest rate.

Our leases provide for base rent payments and, in addition, may include variable payments. Rental income from operating leases, including any payments derived by index or market-based indices, is recognized on a straight line basis over the lease term when we have determined that the collectability of substantially all of the lease payments is probable. Some of our leases have options to extend or terminate the lease exercisable at the option of our tenants, which are considered when determining the lease term. Allowances for bad debts are recognized as a direct reduction of rental income. In certain circumstances, some leases provide the tenant with the right to terminate if the legislature or other funding authority does not appropriate the funding necessary for the tenant to meet its lease obligations; we have determined the fixed non-cancelable lease term of these leases to

We increased rental income to record revenue on a straight line basis by $4,256$7,379 and $2,775$4,173 for the three months ended June 30,March 31, 2024 and 2023, and 2022, respectively, and $8,429 and $5,461 for the six months ended June 30, 2023 and 2022, respectively. Rents receivable, excluding properties classified as held for sale, included $94,705$119,102 and $86,305$112,440 of straight line rent receivables at June 30, 2023March 31, 2024 and December 31, 2022,2023, respectively.

We do not include in our measurement of our lease receivables certain variable payments, including payments determined by changes in the index or market-based indices after the inception of the lease, certain tenant reimbursements and other income until the specific events that trigger the variable payments have occurred. Such payments totaled $22,190$22,558 and $43,560$21,370 for the three and six months ended June 30,March 31, 2024 and 2023, respectively, of which tenant reimbursements totaled $20,853$21,329 and $40,919, respectively. For the three and six months ended June 30, 2022, such payments totaled $22,101 and $44,637, respectively, of which tenant reimbursements totaled $21,009 and $42,484,$20,066, respectively.

As of March 31, 2024 and 2023, the U.S. government and certain state and other government tenants combined were responsible for approximately 27.6% and 28.5%, respectively, of our annualized rental income. The U.S. government is our largest tenant by annualized rental income and represented approximately 20.2% and 19.6% of our annualized rental income as of March 31, 2024 and 2023, respectively. We define annualized rental income as the annualized contractual base rents from our tenants pursuant to our lease agreements as of the measurement date, plus straight line rent adjustments and estimated recurring expense reimbursements to be paid to us, and excluding lease value amortization.

As of JuneMarch 31, 2024, our 151 wholly owned properties were located in 30 2023states and 2022, the U.S. governmentDistrict of Columbia. Properties located in Virginia, California, the District of Columbia, Georgia and certain state and other government tenants combinedIllinois were responsible for approximately 28.5%12.1%, 11.8%, 9.9%, 9.1% and 28.4%, respectively, of our annualized rental income. The U.S. government is our largest tenant by annualized rental income and represented approximately 19.6% and 18.5%8.8% of our annualized rental income as of JuneMarch 31, 2024, respectively.

Interest payable on borrowings under our credit agreement is at a rate of the secured overnight financing rate, or SOFR, plus a margin of 350 basis points. We are also required to pay an unused facility fee on the amount of total lending commitments, which was 25 basis points per annum at March 31, 2024. As of March 31, 2024 and April 30, 20232024, we had $190,000 and 2022, respectively.$180,000, respectively, outstanding under our revolving credit facility, $100,000 outstanding under our term loan and $135,000 and $145,000, respectively, available for borrowing under our revolving credit facility. As of March 31, 2024, the

We can borrow, repay and reborrow funds available under our revolving credit facility until maturity and no principal repayment is due until maturity.

Our revolving credit facility and $510,000 and $520,000, respectively, available for borrowing.

DuringIn February 2024, we issued $300,000 of 9.000% senior secured notes due 2029, or the six2029 Notes. The aggregate net proceeds from the offering of the 2029 Notes were $270,848, after initial purchaser discounts and other offering expenses. The 2029 Notes are fully and unconditionally guaranteed on a joint, several and senior secured basis by certain of our subsidiaries and secured by a pledge of all of the respective equity interests of the subsidiary guarantors and first mortgage liens on 17 properties with a gross book value of real estate assets of $607,727 as of March 31, 2024. The 2029 Notes require semi-annual payments of interest only and are prepayable, at par plus accrued interest, after March 31, 2028.

In March 2024, we redeemed, at par plus accrued interest, all $350,000 of our 4.25% senior unsecured notes due 2024. As a result of this redemption, we recorded a loss on early extinguishment of debt of $425 during the three months ended June 30, 2023, we issuedMarch 31, 2024, which represented the following fourunamortized discounts related to these notes.

As of March 31, 2024, seven of our properties with an aggregate gross book value of real estate assets of $353,610 were encumbered by mortgage notes with an aggregate principal balanceamount of $108,120$177,320. Our mortgage notes are non-recourse, subject to certain limited exceptions and a weighted average interest ratedo not contain any material financial covenants.

We currently do not have sufficient sources of 7.863%:

Our financial instruments include our cash and cash equivalents, restricted cash, rents receivable, accounts payable, a revolving credit facility, a term loan, senior unsecured notes, mortgage notes payable, amounts due to related persons, other accrued expenses and security deposits. At June 30, 2023March 31, 2024 and December 31, 2022,2023, the fair values of our financial instruments approximated their carrying values in our condensed consolidated financial statements, due to their short term nature or floating interest rates, except as follows:

We estimated the fair values of our senior unsecured notes (except for our senior unsecured notes due 2050) using an average of the bid and ask price of the notes (Level 2 inputs as defined in the fair value hierarchy under GAAP) as of the measurement date. We estimated the fair value of our senior unsecured notes due 2050 based on the closing price on The Nasdaq Stock Market LLC, or Nasdaq, (Level 1 inputs as defined in the fair value hierarchy under GAAP) as of the measurement date. We estimated the fair values of our mortgage notes payable using discounted cash flow analyses and currently prevailing market rates (Level 3 inputs as defined in the fair value hierarchy under GAAP) as of the measurement date. Because Level 3 inputs are unobservable, our estimated fair values may differ materially from the actual fair values.

During the three and six months ended June 30, 2023,March 31, 2024, we purchased an aggregate of 6,779 and 7,754869 of our common shares, valued at a weighted average share price of $6.48$7.12, from a former officer and $7.37 from one of our Trustees and certain former officers and employeesemployee of RMR in satisfaction of tax withholding and payment obligations in connection with the vesting of awards of our common shares. We withheld and purchased these common shares at their fair market value based upon the trading price of our common shares at the close of trading on Nasdaq on the purchase date.

We have no employees. The personnel and various services we require to operate our business are provided to us by RMR. We have two agreements with RMR to provide management services to us: (1) a business management agreement, which relates to our business generally; and (2) a property management agreement, which relates to our property level operations.

Pursuant to our business management agreement with RMR, we recognized net business management fees of $3,592$3,558 and $7,543$3,951 for the three and six months ended June 30,March 31, 2024 and 2023, respectively, and $4,492 and $9,202 for the three and six months ended June 30, 2022, respectively. Based on our common share total return, as defined in our business management agreement, as of June 30, 2023,March 31, 2024, no estimated incentive fees are included in the net business management fees we recognized for the three and six months ended June 30, 2023.March 31, 2024. The actual amount of annual incentive fees for 2023,2024, if any, will be based on our common share total return for the three year period ending December 31, 2023,2024, and will be payable in January 2024.2025. We did not incur an incentive fee payable to RMR for the year ended December 31, 2022.2023. We include business management fees in general and administrative expenses in our condensed consolidated statements of comprehensive income (loss).

Pursuant to our property management agreement with RMR, we recognized aggregate net property management and construction supervision fees of $6,163$4,550 and $12,482$6,319 for the three and six months ended June 30,March 31, 2024 and 2023, respectively, and $6,394 and $12,522 for the three and six months ended June 30, 2022, respectively. Of these amounts, for the three and six months ended June 30,March 31, 2024 and 2023, $3,801$3,818 and $7,534,$3,733, respectively, were expensed to other operating expenses in our condensed consolidated statements of comprehensive income (loss) and $2,362$732 and $4,948,$2,586, respectively, were capitalized as building improvements in our condensed consolidated balance sheet. For the three and six months ended June 30, 2022, $4,015 and $8,241, respectively, were expensed to other operating expenses in our condensed consolidated statements of comprehensive income (loss) and $2,379 and $4,281, respectively, were capitalized as building improvements in our condensed consolidated balance sheet.sheets. The amounts capitalized are being depreciated over the estimated useful lives of the related capital assets.

We are generally responsible for all of our operating expenses, including certain expenses incurred or arranged by RMR on our behalf. We are generally not responsible for payment of RMR’s employment, office or administrative expenses incurred to provide management services to us, except for the employment and related expenses of RMR’s employees assigned to work exclusively or partly at our properties, our share of the wages, benefits and other related costs of RMR’s centralized accounting personnel, our share of RMR’s costs for providing our internal audit function and as otherwise agreed. Our property level operating expenses are generally incorporated into the rents charged to our tenants, including certain payroll and related costs incurred by RMR. We reimbursed RMR $6,617$6,587 and $12,964$6,347 for these expenses and costs for the three and six months ended June 30,March 31, 2024 and 2023, respectively, and $6,047 and $12,013 for the three and six months ended June 30, 2022, respectively. We included these amounts in other operating expenses and general and administrative expenses, as applicable, in our condensed consolidated statements of comprehensive income (loss).

We have relationships and historical and continuing transactions with RMR, The RMR Group Inc., or RMR Inc., and others related to them, including other companies to which RMR or its subsidiaries provide management services and some of which have trustees, directors or officers who are also our Trustees or officers. RMR is a majority owned subsidiary of RMR Inc. The Chair of our Board of Trustees and one of our Managing Trustees, Adam D. Portnoy, is the sole trustee, an officer and the controlling shareholder of ABP Trust, which is the controlling shareholder of RMR Inc., the chair of the board of directors, a managing director, the president and chief executive officer of RMR Inc. and an officer and employee of RMR. Jennifer B. Clark, our other Managing Trustee, and our Secretary, also serves asis a managing director and the executive vice president, general counsel and secretary of RMR Inc., an officer and employee of RMR and an officer of ABP Trust. Each of our officers is also an officer and employee of RMR. Some of our Independent Trustees also serve as independent trustees of other public companies to which RMR or its subsidiaries provide management services. Mr. Portnoy serves as chair of the boards and as a managing trustee of these public companies. Other officers of RMR, including Ms. Clark, serve as managing trustees or officers of certain of these companies.

For more information about these and other such relationships and certain other related person transactions, refer to our 20222023 Annual Report and our joint proxy statement/prospectus that is included in our registration statement on Form S-4 filed with the SEC.Report.

The following information should be read in conjunction with our condensed consolidated financial statementsCondensed Consolidated Financial Statements and accompanying notes included in Part I, Item 1 of this Quarterly Report on Form 10-Q and with our 20222023 Annual Report.

We are a real estate investment trust, or REIT, organized under Maryland law. As of June 30, 2023,March 31, 2024, our wholly owned properties were comprised of 155151 properties and we had noncontrolling ownership interests of 51% and 50% in two unconsolidated joint ventures that ownowned three properties containing approximately 444,000471,000 rentable square feet. As of June 30, 2023,March 31, 2024, our properties are located in 30 states and the District of Columbia and contain approximately 20,784,00020,293,000 rentable square feet. As of June 30, 2023,March 31, 2024, our properties were leased to 268261 different tenants with a weighted average remaining lease term (based on annualized rental income) of approximately 6.46.6 years. The U.S. government is our largest tenant, representing approximately 19.6%20.2% of our annualized rental income as of June 30, 2023.March 31, 2024. The term annualized rental income as used herein is defined as the annualized contractual base rents from our tenants pursuant to our lease agreements as of June 30, 2023,March 31, 2024, plus straight line rent adjustments and estimated recurring expense reimbursements to be paid to us, and excluding lease value amortization.

Leases representing approximately 13.0% and 8.6% of our annualized rental income are scheduled to expire during the remainder of 2024 and 2025, respectively, and we may be unable to renew leases or find replacement tenants. Certain changes in office space utilization, that accelerated during the COVID-19 pandemic, including increased remote work arrangements and tenants consolidating their real estate footprint, continue to impact the market. The utilization and demand for office space continues to face headwinds and the duration and ultimate impact of current trends on the demandsdemand for office space at our properties remains uncertain and subject to change. Accordingly, we do not yet know what the full extent of the impacts will be on our or our tenants’ businesses and operations nor the long-term outlook for leasing vacant space.

For more information about the risks relating to these dynamics and conditions and their impacts on us and our business, see Part I, Item IA, “Risk Factors”, of our 20222023 Annual Report.

Unless otherwise noted, the data presented in this section includes properties classified as held for sale as of June 30, 2023March 31, 2024 and excludes three properties owned by two unconsolidated joint ventures in which we ownowned 51% and 50% interests. For more information regarding our properties classified as held for sale and our two unconsolidated joint ventures, see Note 34 to our Condensed Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.