Detailed narrative
Chapter 11 Emergence and Debt Restructuring
OPI successfully emerged from Chapter 11 on June 17th, with newly issued common shares trading on NASDAQ the following day. This reorganization reduced total debt by approximately $714 million and reshaped the debt maturity profile, providing a clearer path forward.
The company now has a refreshed board of trustees and continues to be managed by RMR Group under new five-year agreements, maintaining its operating platform and expertise.
Portfolio Overview and Leasing Activity
As of June 30th, 2026, OPI's portfolio comprised 122 wholly-owned properties across 29 states and D.C., totaling 17.1 million square feet with a weighted average remaining lease term of 6.2 years. Over 60% of annual revenue is derived from tenants with strong credit profiles, including investment-grade and government leases.
During Q2, OPI signed 176,000 square feet of leasing, predominantly renewals, with a weighted average term exceeding seven years.
Lease Expirations and Pipeline
Approximately 2 million square feet of leases, representing 14% of annualized revenue, are scheduled to expire through the end of 2027. Of this, 660,000 square feet is expected to vacate or downsize, reducing to just over 200,000 square feet (less than 2% of annualized revenue) after planned dispositions.
The current leasing pipeline exceeds 2.4 million square feet, with 1.4 million square feet (58%) related to lease renewals, indicating active efforts to address upcoming expirations.
Strategic Disposition Program
OPI has identified 32 properties, totaling 3.7 million square feet and generating $43 million in annualized revenue, for sale. These assets are estimated to generate over $275 million in gross proceeds, intended to enhance liquidity and address debt maturities. The dispositions target properties where value has been maximized, markets with reduced exposure (e.g., exiting Seattle), assets with tenant/lease-related risks, and vacant buildings that are a drag on cash flow.
Disposition Progress and Pricing
Significant progress has been made on the disposition program. In July, two properties were sold for approximately $59 million. Additionally, nine properties are under purchase and sale agreement for $50 million, and 12 assets are under letter of intent for $148 million.
The remaining nine properties are in various stages of marketing, with pricing generally meeting or exceeding internal estimates and third-party appraisals, attracting diverse buyer interest.
Capital Expenditures and Financial Position
Year-to-date, OPI invested $21 million in capital expenditures, including $17 million for leasing activity and $4 million for maintenance. For the full year 2026, total projected spend is $55 million to $60 million. As of June 30th, OPI had $51 million in unrestricted cash and $53 million in restricted cash.
The capital structure includes 22 million common shares outstanding and $1.7 billion of debt with a weighted average interest rate of 9% and a three-year weighted average maturity.
Debt Management and Refinancing
OPI's debt stack includes a $425 million credit facility maturing in January 2027, which the company is actively working to refinance. This facility is secured by 19 high-quality properties with 92% occupancy. The company also faces scheduled principal payments on its senior secured notes, with $15 million due November 1st and $30 million due February 1st, 2027, which are expected to be covered by cash on hand and asset sale proceeds.