Industrial Logistics Properties Trust

Second-quarter normalized FFO was $20.8 million, or $0.31 per share, up 51% year over year. Same property NOI was $88.6 million and same property cash basis NOI was $85.7 million, both up 2% year over year; adjusted EBITDAre was $87.4 million, up 3% year over year. For the quarter, ILPT completed 5.4 million square feet of leasing at 35% GAAP spreads and 14% cash spreads, and consolidated occupancy reached 99%. For 3Q 2026, the company expects interest expense of $61 million, adjusted EBITDAre of $87.5 million to $88.5 million, and normalized FFO of $0.34 to $0.36 per share. For full-year 2026, it now expects capex of $29 million to $34 million, interest expense of about $245 million, adjusted EBITDAre of $348 million to $353 million, and normalized FFO of $1.31 to $1.39 per share.

Yael Duffy said the quarter showed ILPT’s ability to turn operating momentum into shareholder value, pointing to record leasing, higher occupancy, and stronger rent growth. She emphasized that the refinancing materially reduced financial risk by eliminating variable-rate exposure and extending debt maturities to 2029. Her tone was confident but measured, with a focus on preserving cash, reducing leverage over time, and using the portfolio’s embedded rent growth and long-duration leases to compound value.

Tiffany Sy highlighted that normalized FFO of $20.8 million, or $0.31 per share, was in line with guidance and benefited from lower interest expense and rent growth. She noted same property NOI of $88.6 million, same property cash basis NOI of $85.7 million, and adjusted EBITDAre of $87.4 million, plus the May refinancing of a $1.62 billion mortgage at 5.71%. She also said ILPT ended the quarter with $135 million of cash and $46 million of restricted cash, net debt to total assets of 69.2%, and net debt leverage of 11.5x, while raising full-year adjusted EBITDAre and normalized FFO guidance.

Analysts focused on how to think about the $1.5 million normalized FFO adjustment tied to non-controlling interest, and Tiffany said it was a one-time item related to the debt refinancing extinguishment. Questions also centered on how ILPT would use excess cash now that amortization is gone; Yael said the company is comfortable building cash reserves for now and may want flexibility to reduce leverage, especially ahead of the 2029 Hawaii maturity. Management also addressed the Hawaii tenant reserve, saying it was an accounting reserve tied to a tenant they do not expect to collect from, but they are hopeful to work directly with subtenants.