Industrial Logistics Properties Trust (ILPT) 10-Q 26 Apr 21 2021 Q1 Quarterly report Financial data

Cover Page

Cover Page - shares	3 Months Ended
	Mar. 31, 2021	Apr. 22, 2021
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2021
Document Transition Report	false
Entity File Number	001-38342
Entity Registrant Name	INDUSTRIAL LOGISTICS PROPERTIES TRUST
Entity Incorporation, State or Country Code	MD
Entity Tax Identification Number	82-2809631
Entity Address, Address Line One	Two Newton Place,
Entity Address, Address Line Two	255 Washington Street,
Entity Address, Address Line Three	Suite 300,
Entity Address, City or Town	Newton,
Entity Address, State or Province	MA
Entity Address, Postal Zip Code	02458-1634
City Area Code	617
Local Phone Number	219-1460
Title of 12(b) Security	Common Shares of Beneficial Interest
Trading Symbol	ILPT
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		65,301,088
Entity Central Index Key	0001717307
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q1

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Real estate properties:
Land	$ 709,099	$ 709,099
Buildings and improvements	1,100,183	1,099,971
Total real estate properties, gross	1,809,282	1,809,070
Accumulated depreciation	(149,003)	(141,406)
Total real estate properties, net	1,660,279	1,667,664
Investment in unconsolidated joint venture	62,511	60,590
Acquired real estate leases, net	78,394	83,644
Cash and cash equivalents	26,147	22,834
Rents receivable, including straight line rents of $64,797 and $62,753, respectively	70,411	69,511
Deferred leasing costs, net	5,208	4,595
Debt issuance costs, net	1,108	1,477
Due from related persons	1,409	2,665
Other assets, net	3,552	2,765
Total assets	1,909,019	1,915,745
LIABILITIES AND SHAREHOLDERS' EQUITY
Revolving credit facility	217,000	221,000
Mortgage notes payable, net	645,715	645,579
Assumed real estate lease obligations, net	14,053	14,630
Accounts payable and other liabilities	14,720	14,716
Rents collected in advance	7,522	7,811
Security deposits	6,569	6,540
Due to related persons	2,224	2,279
Total liabilities	907,803	912,555
Commitments and contingencies
Shareholders' Equity:
Common shares of beneficial interest, $.01 par value: 100,000,000 shares authorized; 65,301,088 shares issued and outstanding for both periods presented	653	653
Additional paid in capital	1,011,058	1,010,819
Cumulative net income	243,563	224,226
Cumulative common distributions	(254,058)	(232,508)
Total equity attributable to common shareholders	1,001,216	1,003,190
Total liabilities and shareholders' equity	$ 1,909,019	$ 1,915,745

CONDENSED CONSOLIDATED BALANC_2

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Statement of Financial Position [Abstract]
Straight line rents	$ 64,797	$ 62,753
Common shares, par value (in dollars per share)	$ 0.01	$ 0.01
Common shares, shares authorized (in shares)	100,000,000	100,000,000
Common shares, shares issued (in shares)	65,301,088	65,301,088
Common shares, shares outstanding (in shares)	65,301,088	65,301,088

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
REVENUES:
Rental income	$ 54,217	$ 64,278
Expenses:
Real estate taxes	7,247	8,811
Other operating expenses	4,976	5,181
Depreciation and amortization	12,678	18,290
General and administrative	3,756	4,831
Total expenses	28,657	37,113
Interest income	0	111
Interest expense (including net amortization of debt issuance costs, premiums and discounts of $505 and $586, respectively)	(8,741)	(14,519)
Income before income tax expense and equity in earnings of investees	16,819	12,757
Income tax expense	(63)	(63)
Equity in earnings of investees	2,581	0
Net income	19,337	12,694
Net loss attributable to noncontrolling interest	0	152
Net income attributable to common shareholders	$ 19,337	$ 12,846
Weighted average common shares outstanding - basic (in shares)	65,139	65,075
Weighted average common shares outstanding - diluted (in shares)	65,177	65,082
Net income attributable to common shareholders (in dollars per share)	$ 0.30	$ 0.20

CONDENSED CONSOLIDATED STATEM_2

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Income Statement [Abstract]
Amortization of debt issuance costs and premium	$ 505	$ 586

CONDENSED CONSOLIDATED STATEM_3

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) $ in Thousands	Total	Total Equity Attributable to Common Shareholders	Common shares	Additional Paid-in Capital	Cumulative Net Income	Cumulative Common Distributions	Total Attributable to Noncontrolling Interest
Beginning balance (in shares) at Dec. 31, 2019			65,180,628
Beginning balance at Dec. 31, 2019	$ 995,690	$ 995,690	$ 652	$ 999,302	$ 142,155	$ (146,419)	$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	12,694	12,846			12,846		(152)
Shares grants (in shares)			6,000
Share grants	326	326		326
Share repurchases (in shares)			(951)
Share repurchases	(18)	(18)		(18)
Distributions to common shareholders	(21,510)	(21,510)				(21,510)
Contributions from noncontrolling interest	107,640	6,972		6,972			100,668
Ending balance (in shares) at Mar. 31, 2020			65,185,677
Ending balance at Mar. 31, 2020	1,094,822	994,306	$ 652	1,006,582	155,001	(167,929)	100,516
Beginning balance (in shares) at Dec. 31, 2020			65,301,088
Beginning balance at Dec. 31, 2020	1,003,190	1,003,190	$ 653	1,010,819	224,226	(232,508)	0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	19,337	19,337			19,337
Shares grants (in shares)			0
Share grants	239	239		239
Distributions to common shareholders	(21,550)	(21,550)				(21,550)
Ending balance (in shares) at Mar. 31, 2021			65,301,088
Ending balance at Mar. 31, 2021	$ 1,001,216	$ 1,001,216	$ 653	$ 1,011,058	$ 243,563	$ (254,058)	$ 0

CONDENSED CONSOLIDATED STATEM_4

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$ 19,337	$ 12,694
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation	7,617	11,294
Net amortization of debt issuance costs, premiums and discounts	505	586
Amortization of acquired real estate leases and assumed real estate lease obligations	4,673	6,530
Amortization of deferred leasing costs	211	273
Straight line rental income	(2,044)	(1,967)
Other non-cash expenses	239	326
Unconsolidated joint venture distributions	660	0
Equity in earnings of investees	(2,581)	0
Change in assets and liabilities:
Rents receivable	1,144	(775)
Deferred leasing costs	(771)	(273)
Due from related persons	1,256	481
Other assets	(787)	(4,420)
Accounts payable and other liabilities	508	3,196
Rents collected in advance	(289)	1,289
Security deposits	29	12
Due to related persons	(55)	199
Net cash provided by operating activities	29,652	29,445
CASH FLOWS FROM INVESTING ACTIVITIES:
Real estate acquisitions and deposits	0	(71,628)
Real estate improvements	(789)	(2,307)
Net cash used in investing activities	(789)	(73,935)
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings under revolving credit facility	9,000	125,000
Repayments of revolving credit facility	(13,000)	(170,000)
Distributions to common shareholders	(21,550)	(21,510)
Proceeds from noncontrolling interest, net	0	107,640
Repurchase of common shares	0	(18)
Net cash (used in) provided by financing activities	(25,550)	41,112
Increase (decrease) in cash, cash equivalents and restricted cash	3,313	(3,378)
Cash, cash equivalents and restricted cash at beginning of period	22,834	34,550
Cash, cash equivalents and restricted cash at end of period	26,147	31,172
SUPPLEMENTAL DISCLOSURES:
Interest paid	8,240	14,143
SUPPLEMENTAL DISCLOSURE OF CASH, CASH EQUIVALENTS AND RESTRICTED CASH:
Total cash, cash equivalents and restricted cash shown in the statements of cash flows	$ 26,147	$ 31,172

Basis of Presentation

Basis of Presentation	3 Months Ended
	Mar. 31, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation	Basis of PresentationThe accompanying condensed consolidated financial statements of Industrial Logistics Properties Trust and its consolidated subsidiaries, or the Company, ILPT, we, us or our, are unaudited. Certain information and disclosures required by U.S. generally accepted accounting principles, or GAAP, for complete financial statements have been condensed or omitted. We believe the disclosures made are adequate to make the information presented not misleading. However, the accompanying condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes contained in our Annual Report on Form 10-K for the year ended December 31, 2020, or our 2020 Annual Report. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair statement of results for the interim period have been included. All intercompany transactions and balances with or among our consolidated subsidiaries have been eliminated. Our operating results for interim periods are not necessarily indicative of the results that may be expected for the full year. The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect reported amounts. Actual results could differ from those estimates. Significant estimates in the condensed consolidated financial statements include purchase price allocations, useful lives of fixed assets, impairments of real estate and related intangibles.

Real Estate Investments

Real Estate Investments	3 Months Ended
	Mar. 31, 2021
Real Estate [Abstract]
Real Estate Investments	Real Estate Investments As of March 31, 2021, our portfolio was comprised of 289 wholly owned properties containing approximately 34,870,000 rentable square feet, including 226 buildings, leasable land parcels and easements containing approximately 16,756,000 rentable square feet of primarily industrial lands located on the island of Oahu, Hawaii, or our Hawaii Properties, and 63 properties containing approximately 18,114,000 rentable square feet of industrial properties located in 30 other states, or our Mainland Properties. As of March 31, 2021, we also owned a 22% equity interest in an unconsolidated joint venture which owns 12 properties located in nine states totaling approximately 9,227,000 rentable square feet. We operate in one business segment: ownership and leasing of properties that include industrial and logistics buildings and leased industrial lands. For the three months ended March 31, 2021 and 2020, approximately 50.2% and 41.1%, respectively, of our rental income was from our Hawaii Properties. In addition, a subsidiary of Amazon.com, Inc., which is a tenant at certain of our Mainland Properties, accounted for $5,538, or 10.2%, and $9,662, or 15.0%, of our rental income for the three months ended March 31, 2021 and 2020, respectively. During the three months ended March 31, 2021, we committed $3,256 for expenditures related to leasing related costs for leases executed during the period for approximately 620,000 square feet. Committed but unspent tenant related obligations based on existing leases as of March 31, 2021 were $1,704. Certain of our industrial lands in Hawaii may require environmental remediation, especially if the use of those lands is changed; however, we do not have plans to change the use of those lands. As of both March 31, 2021 and December 31, 2020, accrued environmental remediation costs of $6,940 were included in accounts payable and other liabilities in our condensed consolidated balance sheets. These accrued environmental remediation costs relate to maintenance of our properties for current uses, and, because of the indeterminable timing of the remediation, these amounts have not been discounted to present value. In general, we do not have any insurance designated to limit any losses that we may incur as a result of known or unknown environmental conditions which are not caused by an insured event, such as fire or flood, although some of our tenants may maintain such insurance that may benefit us. Although we do not believe that there are environmental conditions at any of our properties that will have a material adverse effect on us, we cannot be sure that such conditions are not present at our properties or that costs we incur to remediate contamination will not have a material adverse effect on our business or financial condition. Charges for environmental remediation costs, if any, are included in other operating expenses in our condensed consolidated statements of comprehensive income. In March 2021, we entered into an agreement to acquire a newly built property located near the Rickenbacker intermodal terminal and airport in Columbus, Ohio containing approximately 358,000 rentable square feet and net leased to a single tenant for a purchase price of $31,500, excluding acquisition related costs. This acquisition is expected to close during the second quarter of 2021. However, this acquisition is subject to conditions; accordingly, we cannot be sure that we will complete this acquisition, that this acquisition will not be delayed or that the terms will not change. Joint Venture Activities As of March 31, 2021, we have an equity investment in a joint venture that consists of the following: ILPT Carrying Value of ILPT Investment at March 31, Number of Square Joint Venture Ownership 2021 Properties Location Feet 12 properties 22% $ 62,511 12 Nine states 9,226,729 The following table provides a summary of the mortgage debts of our joint venture: Principal Balance at March 31, Joint Venture Coupon Rate (1) Maturity Date 2021 (2) Mortgage note payable (secured by one property in Florida) 3.60% 10/1/2023 $ 56,980 Mortgage note payable (secured by 11 other properties in eight states) 3.33% 11/7/2029 350,000 Weighted average/total 3.37% $ 406,980 (1) Includes the effect of mark to market purchase accounting. (2) Amounts are not adjusted for our minority interest; none of the debt is recourse to us. During the three months ended March 31, 2020, we entered into agreements related to a joint venture for 12 of our properties in the mainland United States, or our joint venture, with an Asian institutional investor, and contributed those 12 properties to our joint venture. We received an aggregate of $108,266 from that investor for a 39% equity interest in our joint venture and we retained the remaining 61% equity interest in our joint venture. During the three months ended March 31, 2020, we incurred transaction costs of $626 in connection with the formation of this joint venture. We recognized a 39% noncontrolling interest in our condensed consolidated financial statements for the three months ended March 31, 2020. The portion of our joint venture's net loss not attributable to us, or $152 for the three months ended March 31, 2020, is reported as noncontrolling interest in our condensed consolidated statements of comprehensive income. No distributions were made by our joint venture during the three months ended March 31, 2020. In November 2020, we sold an additional 39% equity interest from our remaining 61% equity interest to a second unrelated third party institutional investor and retained a 22% equity interest in our joint venture. Effective as of the date of the sale, we deconsolidated our joint venture and, since that time, we account for our joint venture using the equity method of accounting under the fair value option. During the three months ended March 31, 2021, we recorded the change in the fair value of our investment in our joint venture of $2,581 as equity in earnings of investees in our condensed consolidated statements of comprehensive income. In addition, during the three months ended March 31, 2021, our joint venture made aggregate cash distributions of $660 to us. See Note 5 for more information regarding our joint venture.

Leases

Leases	3 Months Ended
	Mar. 31, 2021
Leases [Abstract]
Leases	Leases We are a lessor of industrial and logistics properties. Our leases provide our tenants with the contractual right to use and economically benefit from all the physical space specified in the leases; therefore, we have determined to evaluate our leases as lease arrangements. 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. 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 $9,872 and $11,520 for the three months ended March 31, 2021 and 2020, respectively, of which tenant reimbursements totaled $9,627 and $11,275, respectively. We increased rental income to record revenue on a straight line basis by $2,044 and $1,967 for the three months ended March 31, 2021 and 2020, respectively. During the year ended December 31, 2020, certain of our tenants requested relief from their obligations to pay rent due to us in response to the economic conditions resulting from the COVID-19 pandemic. In most cases, the tenants granted deferrals were obligated to pay the deferred rents in 12 equal monthly installments beginning in September 2020. As of March 31, 2021 and December 31, 2020, deferred payments totaling $1,725 and $2,630, respectively, are included in rents receivable in our condensed consolidated balance sheets. These deferred amounts did not impact our operating results for the three months ended March 31, 2021.

Indebtedness

Indebtedness	3 Months Ended
	Mar. 31, 2021
Debt Disclosure [Abstract]
Indebtedness	Indebtedness As of March 31, 2021, our outstanding indebtedness consisted of the following: Net Book Value Principal Balance as of of Collateral March 31, December 31, Interest At March 31, 2021 (1) 2020 (1) Rate Maturity 2021 Unsecured revolving credit facility (2) $ 217,000 $ 221,000 1.41 % Dec 2021 $ — Mortgage notes payable (secured by 186 properties in Hawaii) 650,000 650,000 4.31 % Feb 2029 491,336 867,000 871,000 $ 491,336 Unamortized debt issuance costs (4,285) (4,421) $ 862,715 $ 866,579 (1) The principal balances are the amounts stated in contracts. In accordance with GAAP, our carrying values and recorded interest expense may be different because of market conditions at the time we assumed certain of these debts. (2) The maturity date of our revolving credit facility is December 29, 2021 and we have the option to extend the maturity date for two, six We have a $750,000 unsecured revolving credit facility that is available for our general business purposes, including acquisitions. The maturity date of our revolving credit facility is December 29, 2021. We may borrow, repay and reborrow funds under our revolving credit facility until maturity, and no principal repayment is due until maturity. Interest on borrowings under our revolving credit facility is calculated at floating rates based on LIBOR plus a premium that varies based on our leverage ratio. We have the option to extend the maturity date of our revolving credit facility for two, six Our credit agreement provides for acceleration of payment of all amounts due thereunder upon the occurrence and continuation of certain events of default, such as a change of control of us, which includes The RMR Group LLC, or RMR LLC, ceasing to act as our business manager and property manager. Our credit agreement also contains a number of covenants, including covenants that restrict our ability to incur debts or to make distributions in certain circumstances, and generally requires us to maintain certain financial ratios. We believe we were in compliance with the terms and conditions of the covenants under our credit agreement at March 31, 2021.

Fair Value of Assets and Liabil

Fair Value of Assets and Liabilities	3 Months Ended
	Mar. 31, 2021
Fair Value Disclosures [Abstract]
Fair Value of Assets and Liabilities	Fair Value of Assets and Liabilities Our financial instruments include cash and cash equivalents, restricted cash, rents receivable, our revolving credit facility, mortgage notes payable, accounts payable, rents collected in advance, security deposits and amounts due from or to related persons. At March 31, 2021 and December 31, 2020, the fair value of our financial instruments approximated their carrying values in our condensed consolidated financial statements, due to their short term nature or floating interest rates, except as follows: At March 31, 2021 At December 31, 2020 Carrying Estimated Carrying Estimated Value (1) Fair Value Value (1) Fair Value Mortgage notes payable $ 645,715 $ 706,152 $ 645,579 $ 730,119 (1) Includes unamortized debt issuance costs of $4,285 and $4,421 as of March 31, 2021 and December 31, 2020, respectively. We estimate the fair value of our mortgage notes payable using discounted cash flow analyses and currently prevailing market rates as of the measurement date (Level 3 inputs). Because Level 3 inputs are unobservable, our estimated fair value may differ materially from the actual fair value. The table below presents certain of our assets measured on a recurring basis at fair value at March 31, 2021 , categorized by the level of inputs as defined in the fair value hierarchy under GAAP, used in the valuation of each asset: Quoted Prices in Significant Other Significant Active Markets for Observable Unobservable Identical Assets Inputs Inputs Total (Level 1) (Level 2) (Level 3) Recurring fair value measurements Investment in unconsolidated joint venture (1) $ 62,511 $ — $ — $ 62,511 (1) We own a 22% equity interest in a joint venture that owns 12 properties and is included in investment in unconsolidated joint venture in our condensed consolidated balance sheet, and is reported at fair value, which is based on significant unobservable inputs (Level 3 inputs). The significant unobservable inputs used in the fair value are discount rates of between 4.8% and 7.3%, exit capitalization rates of between 4.4% and 6.8%, holding periods of approximately 10 years and market rents. The assumptions are based on the location, type and nature of each property, and current and anticipated market conditions, which are derived from appraisers, industry publications and our experience. See Note 2 for further information regarding our investment in this joint venture.

Shareholders' Equity

Shareholders' Equity	3 Months Ended
	Mar. 31, 2021
Equity [Abstract]
Shareholders' Equity	Shareholders’ Equity Distributions: During the three months ended March 31, 2021 , we declared and paid a regular quarterly distribution to common shareholders as follows: Record Date Payment Date Distribution Per Share Total Distribution January 25, 2021 February 18, 2021 $ 0.33 $ 21,550 On April 15, 2021, we declared a regular quarterly distribution of $0.33 per common share, or approximately $21,550, to shareholders of record on April 26, 2021. We expect to pay this distribution to our shareholders on or about May 20, 2021.

Per Common Share Amounts

Per Common Share Amounts	3 Months Ended
	Mar. 31, 2021
Earnings Per Share [Abstract]
Per Common Share Amounts	Per Common Share Amounts The following table provides a reconciliation of the weighted average number of common shares used in the calculation of basic and diluted earnings per share (in thousands): Three Months Ended March 31, 2021 2020 Weighted average common shares for basic earnings per share 65,139 65,075 Effect of dilutive securities: unvested share awards 38 7 Weighted average common shares for diluted earnings per share 65,177 65,082

Business and Property Managemen

Business and Property Management Agreements with RMR LLC	3 Months Ended
	Mar. 31, 2021
Related Party Transactions [Abstract]
Business and Property Management Agreements with RMR LLC	Business and Property Management Agreements with RMR LLC We have no employees. The personnel and various services we require to operate our business are provided to us by RMR LLC. We have two agreements with RMR LLC 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 LLC, we recognized net business management fees of $2,544 and $3,307 for the three months ended March 31, 2021 and 2020, respectively. T he net business management fees we recognized for the three months ended March 31, 2020 include $129 of management fees paid to RMR LLC for that period by our joint venture we then owned a majority interest in and whose operating results we reported on a consolidated basis. Beginning in November 2020, our ownership in our joint venture was reduced to a minority interest; as a result, we ceased at that time to consolidate our joint venture’s operating results and, since then, we do not include the management fees it pays to RMR LLC in the management fees we pay to RMR LLC. Our joint venture is further described in Notes 2 and 9. Based on our common share total return, as defined in our business management agreement, as of March 31, 2021 and 2020, no incentive fees are included in the net business management fees we recognized for the three months ended March 31, 2021 or 2020. The actual amount of annual incentive fees for 2021, if any, will be based on our common share total return, as defined in our business management agreement, for the three year period ending December 31, 2021, and will be payable in 2022. We did not incur any incentive fee payable to RMR LLC for the year ended December 31, 2020. We include business management fees in general and administrative expenses in our condensed consolidated statements of comprehensive income. Pursuant to our property management agreement with RMR LLC, we recognized aggregate property management and construction supervision fees of $1,594 and $1,923 for the three months ended March 31, 2021 and 2020, respectively. Of these amounts, for the three months ended March 31, 2021 and 2020, $1,582 and $1,860, respectively, were expensed to other operating expenses in our condensed consolidated statements of comprehensive income and $12 and $63, respectively, were capitalized as building improvements in our condensed consolidated balance sheets. We are generally responsible for all our operating expenses, including certain expenses incurred or arranged by RMR LLC on our behalf. We are generally not responsible for payment of RMR LLC’s employment, office or administrative expenses incurred to provide management services to us, except for the employment and related expenses of RMR LLC’s employees assigned to work exclusively or partly at our properties, our share of the wages, benefits and other related costs of RMR LLC’s centralized accounting personnel, our share of RMR LLC’s costs for providing our internal audit function, or as otherwise agreed. Our property level operating expenses are generally incorporated into the rents charged to our tenants, including certain payroll and related costs incurred by RMR LLC. We reimbursed RMR LLC $1,141 and $1,199 for these expenses and costs for the three months ended March 31, 2021 and 2020, respectively. These amounts are included in other operating expenses and general and administrative expenses, as applicable, in our condensed consolidated statements of comprehensive income. See Note 9 for further information regarding our relationships, agreements and transactions with RMR LLC.

Related Person Transactions

Related Person Transactions	3 Months Ended
	Mar. 31, 2021
Related Party Transactions [Abstract]
Related Person Transactions	Related Person TransactionsWe have relationships and historical and continuing transactions with RMR LLC, The RMR Group Inc., or RMR Inc., and others related to them, including other companies to which RMR LLC or its subsidiaries provide management services and some of which have trustees, directors or officers who are also our Trustees or officers. RMR LLC is a majority owned subsidiary of RMR Inc. The Chair of our Board of Trustees and one of our Managing Trustees, Adam Portnoy, is the sole trustee, an officer and the controlling shareholder of ABP Trust, which is the controlling shareholder of RMR Inc., a managing director and the president and chief executive officer of RMR Inc. and an officer and employee of RMR LLC. John Murray, our other Managing Trustee and our President and Chief Executive Officer, also serves as an officer and employee of RMR LLC, and each of our other officers is also an officer and employee of RMR LLC. Some of our Independent Trustees also serve as independent trustees or independent directors of other public companies to which RMR LLC or its subsidiaries provide management services. Adam Portnoy serves as chair of the boards of trustees or boards of directors of several of these public companies and as a managing director or managing trustee of these public companies. Other officers of RMR LLC, including Mr. Murray and certain of our other officers, serve as managing trustees, managing directors or officers of certain of these companies. Our Manager, RMR LLC . We have two agreements with RMR LLC to provide management services to us. See Note 8 for further information regarding our management agreements with RMR LLC. For further information about these and other such relationships and certain other related person transactions, see our 2020 Annual Report. Our Joint Venture . As of March 31, 2021 and December 31, 2020, our joint venture owed to us $1,409 and $2,665, respectively, for post-closing adjustments relating to our sale of some of our equity interests to a second third party institutional investor in November 2020. These amounts are presented as due from related persons in our condensed consolidated balance sheets.

Basis of Presentation (Policies

Basis of Presentation (Policies)	3 Months Ended
	Mar. 31, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization and basis of presentation	The accompanying condensed consolidated financial statements of Industrial Logistics Properties Trust and its consolidated subsidiaries, or the Company, ILPT, we, us or our, are unaudited. Certain information and disclosures required by U.S. generally accepted accounting principles, or GAAP, for complete financial statements have been condensed or omitted. We believe the disclosures made are adequate to make the information presented not misleading. However, the accompanying condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes contained in our Annual Report on Form 10-K for the year ended December 31, 2020, or our 2020 Annual Report. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair statement of results for the interim period have been included. All intercompany transactions and balances with or among our consolidated subsidiaries have been eliminated. Our operating results for interim periods are not necessarily indicative of the results that may be expected for the full year.
Use of estimates	The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect reported amounts. Actual results could differ from those estimates. Significant estimates in the condensed consolidated financial statements include purchase price allocations, useful lives of fixed assets, impairments of real estate and related intangibles.
Fair value of assets and liabilities	We estimate the fair value of our mortgage notes payable using discounted cash flow analyses and currently prevailing market rates as of the measurement date (Level 3 inputs). Because Level 3 inputs are unobservable, our estimated fair value may differ materially from the actual fair value.

Real Estate Investments (Tables

Real Estate Investments (Tables)	3 Months Ended
	Mar. 31, 2021
Real Estate [Abstract]
Summary of investment in unconsolidated joint ventures	As of March 31, 2021, we have an equity investment in a joint venture that consists of the following: ILPT Carrying Value of ILPT Investment at March 31, Number of Square Joint Venture Ownership 2021 Properties Location Feet 12 properties 22% $ 62,511 12 Nine states 9,226,729
Summary of the mortgage debt of our joint venture	The following table provides a summary of the mortgage debts of our joint venture: Principal Balance at March 31, Joint Venture Coupon Rate (1) Maturity Date 2021 (2) Mortgage note payable (secured by one property in Florida) 3.60% 10/1/2023 $ 56,980 Mortgage note payable (secured by 11 other properties in eight states) 3.33% 11/7/2029 350,000 Weighted average/total 3.37% $ 406,980 (1) Includes the effect of mark to market purchase accounting. (2) Amounts are not adjusted for our minority interest; none of the debt is recourse to us.

Indebtedness (Tables)

Indebtedness (Tables)	3 Months Ended
	Mar. 31, 2021
Debt Disclosure [Abstract]
Schedule of outstanding indebtedness	As of March 31, 2021, our outstanding indebtedness consisted of the following: Net Book Value Principal Balance as of of Collateral March 31, December 31, Interest At March 31, 2021 (1) 2020 (1) Rate Maturity 2021 Unsecured revolving credit facility (2) $ 217,000 $ 221,000 1.41 % Dec 2021 $ — Mortgage notes payable (secured by 186 properties in Hawaii) 650,000 650,000 4.31 % Feb 2029 491,336 867,000 871,000 $ 491,336 Unamortized debt issuance costs (4,285) (4,421) $ 862,715 $ 866,579 (1) The principal balances are the amounts stated in contracts. In accordance with GAAP, our carrying values and recorded interest expense may be different because of market conditions at the time we assumed certain of these debts. (2) The maturity date of our revolving credit facility is December 29, 2021 and we have the option to extend the maturity date for two, six

Fair Value of Assets and Liab_2

Fair Value of Assets and Liabilities (Tables)	3 Months Ended
	Mar. 31, 2021
Fair Value Disclosures [Abstract]
Schedule of carrying value and the estimated fair market value of mortgage notes payable	At March 31, 2021 and December 31, 2020, the fair value of our financial instruments approximated their carrying values in our condensed consolidated financial statements, due to their short term nature or floating interest rates, except as follows: At March 31, 2021 At December 31, 2020 Carrying Estimated Carrying Estimated Value (1) Fair Value Value (1) Fair Value Mortgage notes payable $ 645,715 $ 706,152 $ 645,579 $ 730,119 (1) Includes unamortized debt issuance costs of $4,285 and $4,421 as of March 31, 2021 and December 31, 2020, respectively.
Fair Value Measurements, Recurring and Nonrecurring	The table below presents certain of our assets measured on a recurring basis at fair value at March 31, 2021 , categorized by the level of inputs as defined in the fair value hierarchy under GAAP, used in the valuation of each asset: Quoted Prices in Significant Other Significant Active Markets for Observable Unobservable Identical Assets Inputs Inputs Total (Level 1) (Level 2) (Level 3) Recurring fair value measurements Investment in unconsolidated joint venture (1) $ 62,511 $ — $ — $ 62,511 (1) We own a 22% equity interest in a joint venture that owns 12 properties and is included in investment in unconsolidated joint venture in our condensed consolidated balance sheet, and is reported at fair value, which is based on significant unobservable inputs (Level 3 inputs). The significant unobservable inputs used in the fair value are discount rates of between 4.8% and 7.3%, exit capitalization rates of between 4.4% and 6.8%, holding periods of approximately 10 years and market rents. The assumptions are based on the location, type and nature of each property, and current and anticipated market conditions, which are derived from appraisers, industry publications and our experience. See Note 2 for further information regarding our investment in this joint venture.

Shareholders' Equity (Tables)

Shareholders' Equity (Tables)	3 Months Ended
	Mar. 31, 2021
Equity [Abstract]
Schedule of distributions declared and paid	During the three months ended March 31, 2021 , we declared and paid a regular quarterly distribution to common shareholders as follows: Record Date Payment Date Distribution Per Share Total Distribution January 25, 2021 February 18, 2021 $ 0.33 $ 21,550

Per Common Share Amounts (Table

Per Common Share Amounts (Tables)	3 Months Ended
	Mar. 31, 2021
Earnings Per Share [Abstract]
Schedule of weighted average number of shares	The following table provides a reconciliation of the weighted average number of common shares used in the calculation of basic and diluted earnings per share (in thousands): Three Months Ended March 31, 2021 2020 Weighted average common shares for basic earnings per share 65,139 65,075 Effect of dilutive securities: unvested share awards 38 7 Weighted average common shares for diluted earnings per share 65,177 65,082

Real Estate Investments - Narra

Real Estate Investments - Narrative (Details) $ in Thousands	1 Months Ended		3 Months Ended
	Mar. 31, 2021USD ($)ft²propertystatebuilding	Nov. 30, 2020	Mar. 31, 2021USD ($)ft²propertystatesegmentbuilding	Mar. 31, 2020USD ($)property	Dec. 31, 2020USD ($)
Real Estate Properties [Line Items]
Number of properties owned | property	289		289
Net rentable area | ft²	34,870,000		34,870,000
Number of business segments | segment			1
Rental income			$ 54,217	$ 64,278
Commitments related to tenant improvements and leasing costs			$ 3,256
Net rentable area | ft²	620,000		620,000
Committed bus unspent tenant related obligations	$ 1,704		$ 1,704
Accrued environmental remediation costs	$ 6,940		6,940		$ 6,940
Net loss attributable to noncontrolling interest			0	152
Amazon Inc Subsidiaries
Real Estate Properties [Line Items]
Rental income			$ 5,538	$ 9,662
Sales Revenue, Net | Customer Concentration Risk | Amazon Inc Subsidiaries
Real Estate Properties [Line Items]
Percentage of revenues			10.20%	15.00%
Hawaii
Real Estate Properties [Line Items]
Net rentable area | ft²	16,756,000		16,756,000
Number of buildings, leasable land parcels easements | building	226		226
Hawaii | Sales Revenue, Net | Geographic Concentration Risk
Real Estate Properties [Line Items]
Percentage of revenues			50.20%	41.10%
Other States
Real Estate Properties [Line Items]
Number of properties owned | property	63		63
Net rentable area | ft²	18,114,000		18,114,000
Number of states where real estate is located | state	30		30
Columbus, Ohio
Real Estate Properties [Line Items]
Net rentable area | ft²	358,000		358,000
Payments to acquire property, plant, and equipment	$ 31,500
Twelve Mainland Properties
Real Estate Properties [Line Items]
Net rentable area | ft²	9,226,729		9,226,729
Number of states where real estate is located | state	9		9
Equity interest remaining	22.00%	22.00%	22.00%
Number of properties contributed | property	12		12	12
Ownership percentage sold		39.00%
Proceeds from sale of interest in joint Venture				$ 108,266
Noncontrolling interest, ownership percentage by noncontrolling owners				39.00%
Ownership interest				61.00%
Transactions costs				$ 626
Change in fair value of investment in joint venture			$ 2,581
Cash distributions			$ 660
Twelve Mainland Properties | Variable Interest Entity
Real Estate Properties [Line Items]
Net loss attributable to noncontrolling interest				$ 152

Real Estate Investments - Joint

Real Estate Investments - Joint Venture Activities (Details) $ in Thousands	Mar. 31, 2021USD ($)ft²propertystate	Dec. 31, 2020USD ($)	Nov. 30, 2020	Mar. 31, 2020property
Schedule of Equity Method Investments [Line Items]
Investment in unconsolidated joint venture | $	$ 62,511	$ 60,590
Net rentable area | ft²	34,870,000
Twelve Mainland Properties
Schedule of Equity Method Investments [Line Items]
Equity interest remaining	22.00%		22.00%
Investment in unconsolidated joint venture | $	$ 62,511
Number of properties contributed | property	12			12
Number of states where real estate is located | state	9
Net rentable area | ft²	9,226,729

Real Estate Investments - Joi_2

Real Estate Investments - Joint Venture Indebtedness (Details) $ in Thousands	Mar. 31, 2021USD ($)propertystate	Dec. 31, 2020USD ($)
Schedule of Equity Method Investments [Line Items]
Principal Balance	$ 867,000	$ 871,000
Twelve Mainland Properties
Schedule of Equity Method Investments [Line Items]
Number of states where real estate is located | state	9
Interest rate (as a percent)	3.37%
Principal Balance	$ 406,980
Twelve Mainland Properties | Mortgage note payable | Mortgage note payable (secured by one property in Florida)
Schedule of Equity Method Investments [Line Items]
Number of properties | property	1
Interest rate (as a percent)	360.00%
Principal Balance	$ 56,980
Twelve Mainland Properties | Mortgage note payable | Mortgage note payable (secured by 11 other properties in eight states)
Schedule of Equity Method Investments [Line Items]
Number of properties | property	11
Number of states where real estate is located | property	8
Interest rate (as a percent)	333.00%
Principal Balance	$ 350,000

Leases - Narrative (Details)

Leases - Narrative (Details) $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2021USD ($)installmentPayment	Mar. 31, 2020USD ($)	Dec. 31, 2020USD ($)
Leases [Abstract]
Certain variable payments	$ 9,872	$ 11,520
Tenant reimbursements	9,627	11,275
Straight line rental income	$ 2,044	$ 1,967
Number of monthly installment payments | installmentPayment	12
Increase to accounts receivable from deferred payments	$ 1,725		$ 2,630

Indebtedness - Summary of Outst

Indebtedness - Summary of Outstanding Indebtedness (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2021USD ($)optionproperty	Dec. 31, 2020USD ($)
Debt Instrument [Line Items]
Principal Balance	$ 867,000	$ 871,000
Unamortized debt issuance costs	(4,285)	(4,421)
Carrying value	862,715	866,579
Net Book Value of Collateral	$ 491,336
Hawaii
Debt Instrument [Line Items]
Number of properties used as collateral | property	186
Revolving credit facility
Debt Instrument [Line Items]
Principal Balance	$ 217,000	221,000
Interest rate (as a percent)	1.41%
Net Book Value of Collateral	$ 0
Number of options to extend maturity date | option	2
Extension of maturity date	6 months
Mortgage note payable | Mortgage notes payable (secured by 186 properties in Hawaii)
Debt Instrument [Line Items]
Principal Balance	$ 650,000	$ 650,000
Interest rate (as a percent)	4.31%
Net Book Value of Collateral	$ 491,336

Indebtedness - Narrative (Detai

Indebtedness - Narrative (Details)	3 Months Ended
	Mar. 31, 2021USD ($)option	Mar. 31, 2020	Dec. 31, 2020USD ($)
Debt Instrument [Line Items]
Revolving credit facility	$ 217,000,000		$ 221,000,000
Revolving credit facility
Debt Instrument [Line Items]
Maximum borrowing capacity of revolving credit facility and term loan	$ 750,000,000
Number of options to extend maturity date | option	2
Extension of maturity date	6 months
Option to increase maximum borrowing capacity	$ 1,500,000,000
Commitment fee percentage	0.25%
Interest rate at the end of the period (as a percent)	1.41%		1.70%
Weighted average interest rate (as a percent)	1.57%	3.23%
Revolving credit facility	$ 217,000,000
Remaining borrowing capacity	$ 533,000,000
Revolving credit facility | LIBOR
Debt Instrument [Line Items]
Basis spread on variable rate	1.30%

Fair Value of Assets and Liab_3

Fair Value of Assets and Liabilities (Details) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Fair Value of Financial Instruments
Mortgage notes payable	$ 645,715	$ 645,579
Carrying Value
Fair Value of Financial Instruments
Mortgage notes payable	645,715	645,579
Estimated Fair Value
Fair Value of Financial Instruments
Mortgage notes payable	706,152	730,119
Mortgage note payable
Fair Value of Financial Instruments
Unamortized premium	$ 4,285	$ 4,421

Fair Value of Assets and Liab_4

Fair Value of Assets and Liabilities - Assets Measured on Recurring Basis (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2021USD ($)property
Twelve Mainland Properties
Fair Value of Financial Instruments
Equity interest remaining	22.00%
Number of properties contributed | property	12
Fair Value, Inputs, Level 3
Fair Value of Financial Instruments
Holding period	10 years
Fair Value, Inputs, Level 3 | Minimum | Measurement Input, Discount Rate
Fair Value of Financial Instruments
Unconsolidated joint venture measurement input	0.048
Fair Value, Inputs, Level 3 | Minimum | Measurement Input, Cap Rate
Fair Value of Financial Instruments
Unconsolidated joint venture measurement input	0.044
Fair Value, Inputs, Level 3 | Maximum | Measurement Input, Discount Rate
Fair Value of Financial Instruments
Unconsolidated joint venture measurement input	0.073
Fair Value, Inputs, Level 3 | Maximum | Measurement Input, Cap Rate
Fair Value of Financial Instruments
Unconsolidated joint venture measurement input	0.068
Fair Value, Recurring
Fair Value of Financial Instruments
Investments in unconsolidated joint venture	$ 62,511
Fair Value, Recurring | Fair Value, Inputs, Level 1
Fair Value of Financial Instruments
Investments in unconsolidated joint venture	0
Fair Value, Recurring | Fair Value, Inputs, Level 2
Fair Value of Financial Instruments
Investments in unconsolidated joint venture	0
Fair Value, Recurring | Fair Value, Inputs, Level 3
Fair Value of Financial Instruments
Investments in unconsolidated joint venture	$ 62,511

Shareholders' Equity (Details)

Shareholders' Equity (Details) - USD ($) $ / shares in Units, $ in Thousands	Apr. 15, 2021	Feb. 18, 2021	Mar. 31, 2021	Mar. 31, 2020
Shareholders' Equity
Dividends paid (in dollars per share)		$ 0.33
Dividends paid		$ 21,550	$ 21,550	$ 21,510
Subsequent Event
Shareholders' Equity
Dividends paid (in dollars per share)	$ 0.33
Dividends paid	$ 21,550

Per Common Share Amounts (Detai

Per Common Share Amounts (Details) - shares shares in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Earnings Per Share [Abstract]
Weighted average common shares for basic earnings per share (in shares)	65,139	65,075
Effect of dilutive securities: unvested share awards (in shares)	38	7
Weighted average common shares for diluted earnings per share (in shares)	65,177	65,082

Business and Property Managem_2

Business and Property Management Agreements with RMR LLC (Details)	3 Months Ended		12 Months Ended
	Mar. 31, 2021USD ($)employeeagreement	Mar. 31, 2020USD ($)	Dec. 31, 2020USD ($)
Related Party Transaction [Line Items]
Number of employees | employee	0
Incentive fee expense			$ 0
Due to related persons	$ 2,224,000		$ 2,279,000
Business Management Fees
Related Party Transaction [Line Items]
Incentive fee expense	$ 0	$ 0
Reit Management And Research L L C
Related Party Transaction [Line Items]
Number of management service agreements | agreement	2
Business management fees	$ 2,544,000	3,307,000
Related party reimbursement expense	1,141,000	1,199,000
Reit Management And Research L L C | Property Management and Construction Supervision Fees
Related Party Transaction [Line Items]
Expenses from transactions	1,594,000	1,923,000
Reit Management And Research L L C | Property Management and Construction Supervision Fees | Other Operating Income (Expense)
Related Party Transaction [Line Items]
Expenses from transactions	1,582,000	1,860,000
Reit Management And Research L L C | Investment Building and Building Improvements | Capitalized Costs
Related Party Transaction [Line Items]
Due to related persons	$ 12,000	63,000
Reit Management And Research L L C | Joint Venture
Related Party Transaction [Line Items]
Business management fees		$ 129,000

Related Person Transactions - N

Related Person Transactions - Narrative (Details) $ in Thousands	Mar. 31, 2021USD ($)agreement	Dec. 31, 2020USD ($)
Related Party Transaction [Line Items]
Due from related persons	$ 1,409	$ 2,665
Reit Management And Research L L C
Related Party Transaction [Line Items]
Number of management service agreements | agreement	2
Industrial Fund | Post-Closing Adjustment
Related Party Transaction [Line Items]
Due from related persons	$ 1,409	$ 2,665

Uncategorized Items - ilpt-2021

Label	Element	Value
Restricted Cash and Cash Equivalents	us-gaap_RestrictedCashAndCashEquivalents	$ 0
Restricted Cash and Cash Equivalents	us-gaap_RestrictedCashAndCashEquivalents	$ 11,302,000