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Dec 31, 2020
OPI Q4 2020 Earnings Report
Announced fourth quarter and year end 2020 results, reporting a net loss of $1.7 million and normalized FFO of $61.8 million.
Key Takeaways
Office Properties Income Trust reported a net loss of $1.7 million, or $0.03 per share, for the fourth quarter of 2020. Normalized FFO was $61.8 million, or $1.28 per share, and CAD increased 6.5% year over year to $42.3 million, or $0.88 per share. Same Property Cash Basis NOI increased 5.1% year over year, and the company completed 2.0 million square feet of leasing in 2020 with a 6.9% roll-up in rents.
Net loss for the quarter ended December 31, 2020 was $1.7 million, or $0.03 per diluted share.
Normalized funds from operations, or Normalized FFO, and cash available for distribution, or CAD, for the quarter ended December 31, 2020 were $61.8 million, or $1.28 per diluted share, and $42.3 million, or $0.88 per diluted share, respectively.
Same Property cash basis net operating income, or Cash Basis NOI, increased 5.1% for the quarter ended December 31, 2020 compared to the quarter ended December 31, 2019.
Completed two million square feet of activity with an average lease term of over seven years and a roll-up in rents of 6.9%.
OPI
OPI
Forward Guidance
OPI's asset and property management teams remain focused on proactive tenant engagement to drive leasing and retention, along with management of property operations as tenants continue to advance their re-entry plans. With strong liquidity, including full availability on our $750 million revolving credit facility, OPI is well positioned to execute on growth activity through property acquisitions and select development and repositioning opportunities across our portfolio.
Positive Outlook
- Focus on proactive tenant engagement to drive leasing and retention.
- Management of property operations as tenants continue to advance their re-entry plans.
- Strong liquidity position.
- Full availability on the $750 million revolving credit facility.
- Well positioned to execute on growth activity through property acquisitions and select development and repositioning opportunities.
Challenges Ahead
- Operating results, rent collections and ability to realize positive leasing activity depend on various factors, including market conditions, the impact of the COVID-19 pandemic and tenants' demand for OPI's properties, the timing of lease expirations and OPI's ability to successfully compete for tenants.
- OPI’s tenants may be significantly adversely impacted, which may result in additional tenants seeking relief from their rent obligations, tenants being unable to pay rent, tenants terminating their leases or tenants not renewing their leases or renewing their leases for less space.
- Tenants may delay re-entry or may utilize less space upon re-entry and later seek to reduce their leased space or terminate or not renew their leases.
- OPI may not be able to re-lease that space and it may take an extended period to identify replacement tenants and negotiate and enter new lease agreements for that space and OPI may realize rent roll-downs with respect to any such new leases
- OPI may not be able to identify and successfully negotiate and complete acquisitions and it may not realize its target returns on investments it may make