Office Properties Income Trust Announces Changes to the Benchmark Index for its Business Management Agreement with The RMR Group LLC

Rhea-AI Summary

Office Properties Income Trust (Nasdaq: OPI) has amended its business management agreement with The RMR Group LLC to replace the SNL U.S. REIT Office Index with the MSCI U.S. REIT/Office REIT Index for incentive management fee calculations starting August 1, 2021. The historical performance comparisons show that the MSCI index closely aligns with the SNL index. This change aims to ensure a reliable benchmark as the previous index has been discontinued.

Positive

• Replacement of the discontinued SNL U.S. REIT Office Index with the MSCI U.S. REIT/Office REIT Index provides a comparable and widely used benchmark.
• Transition aims to enhance incentive management fee calculation transparency and reliability.

Negative

• None.

MSCI U.S. REIT/Office REIT Index to Replace Discontinued SNL U.S. REIT Office Index

NEWTON, Mass.--(BUSINESS WIRE)-- Office Properties Income Trust (Nasdaq: OPI) announced today that it has amended its business management agreement with The RMR Group LLC, or RMR LLC, a majority-owned subsidiary of The RMR Group Inc. (Nasdaq RMR), to replace the benchmark index used in the calculation of incentive management fees. Pursuant to the amendment, for periods beginning on and after August 1, 2021, the MSCI U.S. REIT/Office REIT index will replace the discontinued SNL U.S. REIT Office Index and be used to calculate benchmark returns per share for purposes of determining any incentive management fee payable by OPI to RMR LLC. For periods prior to August 1, 2021, the SNL U.S. REIT Office Index will continue to be used.

For purposes of calculating any incentive fees, the following lists the historical returns used to calculate incentive fees under the applicable SNL indices for the two years and stub period ending July 31, 2021:

		Total Return for the Period
Benchmark Return (cumulative % return of SNL Index) at 7/31/2021(1)		12/31/2018 to 7/31/2021		12/31/2019 to 7/31/2021		12/31/2020 to 7/31/2021
SNL U.S. REIT Office Index		19.70%		-6.06%		18.27%

⁽¹⁾ Adjusted for common share issuances during the measurement period.

The calculation of incentive management fees for the next three measurement periods will continue to use the SNL U.S. REIT Office index in calculating the benchmark returns for periods through July 31, 2021. Following the announcement that the SNL U.S. REIT Office Index would be discontinued, OPI and RMR sought to replace the expiring index with a comparable, publicly accessible and widely-used index that most closely matched its composition and historical performance. The MSCI U.S. REIT/Office REIT Index is a well-known REIT benchmark and the historical returns are comparable to the SNL U.S. REIT Office Index it will be replacing.

About Office Properties Income Trust

Office Properties Income Trust is a real estate investment trust, or REIT, focused on owning, operating and leasing properties primarily leased to single tenants and those with high credit quality characteristics such as government entities. OPI is managed by the operating subsidiary of The RMR Group Inc. (Nasdaq: RMR), an alternative asset management company that is headquartered in Newton, Massachusetts.

A Maryland Real Estate Investment Trust with transferable shares of beneficial interest listed on the Nasdaq.

No shareholder, Trustee or officer is personally liable for any act or obligation of the Trust.

View source version on businesswire.com: https://www.businesswire.com/news/home/20211001005183/en/

Kevin Barry, Director, Investor Relations

(617) 219-1410

Source: Office Properties Income Trust

FAQ

What does the amendment to the management agreement mean for OPI and RMR?

The amendment allows OPI to use the MSCI U.S. REIT/Office REIT Index for calculating incentive management fees, replacing the discontinued SNL U.S. REIT Office Index.

When will OPI start using the MSCI U.S. REIT/Office REIT Index?

OPI will begin using the MSCI index for incentive management fee calculations starting on August 1, 2021.

How does the MSCI U.S. REIT/Office REIT Index compare with the SNL U.S. REIT Office Index?

The MSCI index is noted for having comparable historical performance to the SNL index it replaces.

What is the impact of this index change on OPI's performance metrics?

The index change aims to ensure that performance metrics for incentive fees are based on a reliable and widely accepted benchmark.