Office Properties Income Trust (OPI) 2020 Q2 法說會逐字稿

Hello and welcome to the Office Properties Income Trust Q2 2020 Earnings Conference Call. (Operator Instructions) Please note, today's event is being recorded.

您好，歡迎參加 Office Properties Income Trust 2020 年第二季財報電話會議。（操作員說明）請注意，今天的活動正在錄製中。

I would now like to turn the conference over to Olivia Snyder Manager of Investor Relations. Please go ahead ma'am.

我現在想將會議轉交給投資者關係經理 Olivia Snyder。女士，請繼續。

Thank you, and good morning, everyone, thanks for joining us today. With me on the call are OPI's President and Chief Executive Officer, David Blackman; Chief Financial Officer and Treasurer, Matt Brown; and Vice President and Chief Operating Officer, Chris Bilotto. And in just a moment. They will provide details about our business and our performance for the second quarter of 2020 followed by a question-and answer session with all financial analysts. First, I would like to note that the recording and retransmission of today's conference call is prohibited without the prior written consent of the company. Also note that today's conference call contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other securities law.

謝謝大家，早安，謝謝您今天加入我們。與我一起參加電話會議的有 OPI 總裁兼執行長 David Blackman；財務長兼財務主管馬特布朗；副總裁兼營運長 Chris Bilotto。就在一瞬間。他們將提供有關我們 2020 年第二季度業務和業績的詳細信息，然後與所有財務分析師進行問答。首先，我想指出的是，未經公司事先書面同意，禁止對今天的電話會議進行錄音和轉播。另請注意，今天的電話會議包含 1995 年《私人證券訴訟改革法案》和其他證券法含義內的前瞻性陳述。

These forward-looking statements are based on OPI's beliefs and expectations as of today, Thursday, July 30 2020 and actual results may differ materially from those that we project. The company undertakes no obligation to revise or publicly release the results of any revision to forward-looking statements made in today's conference call. Additional information concerning factors that could cause those differences is contained in our filings with the Securities and Exchange Commission or SEC which can be accessed from our website opireit.com or the SEC's website investors are cautioned not to place undue reliance upon any forward-looking statements. In addition, we will be discussing non-GAAP numbers during this call, including normalized findings from operations or normalized FFO cash available for distribution or CAD adjusted EBITDA and cash basis, net operating income or cash basis NOI. A reconciliation of these non-GAAP figures to net income are available in our supplemental operating and financial data package, which also can be found on our website. In addition, we will be providing guidance on this call, including normalized FFO and cash basis NOI we are not providing reconciliation of these non-GAAP measures as part of our guidance, because certain information required for such reconciliation is not available without unreasonable effort or at all, such as gains and losses or impairment charges related to the disposition of real estate.

這些前瞻性聲明是基於 OPI 截至今天（2020 年 7 月 30 日星期四）的信念和預期，實際結果可能與我們的預測有重大差異。該公司沒有義務修改或公開發布今天電話會議中前瞻性陳述的任何修改結果。有關可能導致這些差異的因素的更多資​​訊包含在我們向美國證券交易委員會或SEC 提交的文件中，您可以從我們的網站opireit.com 或SEC 網站存取這些文件，投資者請勿過度依賴任何前瞻性陳述。此外，我們將在本次電話會議中討論非 GAAP 數據，包括標準化的營運結果或標準化的可用於分配的 FFO 現金或加幣調整後的 EBITDA 和現金制、淨營業收入或現金制 NOI。這些非公認會計準則資料與淨利潤的對帳可在我們的補充營運和財務資料包中找到，這些資料包也可以在我們的網站上找到。此外，我們將就本次電話會議提供指導，包括標準化FFO 和現金制NOI。作為我們指導的一部分，我們不會提供這些非GAAP 措施的對賬，因為如果沒有不合理的努力或不合理的努力，就無法獲得此類對帳所需的某些信息，或一切，例如與房地產處置相關的損益或減損費用。

Now I will turn the call over to David.

現在我將把電話轉給大衛。

Thank you, Olivia, and good morning. Welcome to the second quarter earnings call for Office Properties Income Trust. If you listen to our prepared remarks, you will note a recurring theme, which is that our underlying business is performing incredibly well. For the second quarter, we produced normalized FFO that exceeded both consensus estimates and our guidance for the quarter, we generated, year-over-year same property cash NOI growth of 2.5% also above expectations.

謝謝你，奧利維亞，早安。歡迎參加辦公地產收入信託第二季財報電話會議。如果您聽我們準備好的講話，您會注意到一個反覆出現的主題，那就是我們的基礎業務表現非常好。第二季度，我們產生的標準化 FFO 超越了共識預期和我們對本季的指導，我們產生的房地產現金 NOI 年成長 2.5%，也高於預期。

Despite the market uncertainty regarding Office usage and tenant demand for space. We also had strong leasing activity in the second quarter, completing 642,000 square feet of the new and renewal leases for 3.9% roll up in rent and a weighted average lease term of more than 6 years. In fact, our year-over-year leasing volume was up approximately 12.5% while the broader market was down 44%. Our consolidated portfolio occupancy. Increased 10 basis points in comparison to the prior year and 20 basis points in comparison to the previous year. Second quarter rent collections remained strong and at the high end of collections for the office sector with 98% of cash rent collected and we have granted minimal rent deferral totaling $2.5 million for the months of April through September representing only 88 basis points of contractual cash rent over the same period.

儘管辦公室使用情況和租戶對空間的需求存在市場不確定性。第二季我們的租賃活動也很強勁，完成了 642,000 平方英尺的新租約和續約租約，租金上漲 3.9%，加權平均租期超過 6 年。事實上，我們的租賃量年增了約 12.5%，而大盤卻下降了 44%。我們的綜合投資組合入住率。比上年增加10個基點，比上年增加20個基點。第二季的租金收付依然強勁，處於辦公部門租金收付的高端，收取了98% 的現金租金，我們為4 月至9 月提供了總計250 萬美元的最低租金延期，僅相當於合約現金租金的88 個基點同一時期。

As a result of the successful completion of OPIs disposition program in 2019 our balance sheet remains well positioned to weather the impact of the current economic challenges. Leverage has been below our target range for the last 3 quarters, and we have approximately $570 million of liquidity. In June and July, we issued $162 million of 30-year senior unsecured notes and used the proceeds to pay down our unsecured revolving credit facility. We also entered an agreement to sell a full Property business Park for $25.4 million under our capital recycling program. These transactions further support our low leverage and healthy liquidity. Our distribution to shareholders is also secure as the second quarter CAD payout ratio was less than 58% and it is expected to be below our long-term target for the full year.

由於 2019 年 OPI 處置計畫成功完成，我們的資產負債表仍能很好地應對當前經濟挑戰的影響。過去三個季度的槓桿率一直低於我們的目標範圍，我們擁有約 5.7 億美元的流動資金。6 月和 7 月，我們發行了 1.62 億美元的 30 年期高級無抵押票據，並用所得收益來償還我們的無抵押循環信貸額度。我們還簽訂了一項協議，根據我們的資本回收計劃，以 2540 萬美元的價格出售整個房地產商業園區。這些交易進一步支持了我們的低槓桿率和健康的流動性。我們向股東的分配也很安全，因為第二季加幣派息率低於 58%，預計將低於我們全年的長期目標。

Turning to acquisitions and capital recycling. In July we entered an agreement to acquire a single-tenant office property in Denver, Colorado for a purchase price of $38.1 million. This property is a 100% leased to an investment grade rated tenant for 11.5 years. Upon concluding diligence and closing, we will provide more detail on pricing and the CAD accretion created by funding this acquisition with proceeds from our capital recycling program. This acquisition is expected to close before our next earnings call.

轉向收購和資本回收。7 月，我們達成協議，以 3,810 萬美元的價格收購科羅拉多州丹佛市的一處單一租戶辦公物業。該房產已 100% 出租給投資等級租戶，租期為 11.5 年。在完成盡職調查和交割後，我們將提供有關定價以及透過利用我們的資本回收計劃收益為本次收購提供資金而產生的加元增值的更多詳細資訊。此次收購預計將在我們下次財報電話會議前完成。

Although we have temporarily paused our capital recycling program, we believe there may be an interesting opportunity to market a handful of properties beginning in the fourth quarter. Our OPI is not forced to sell assets today, we believe it is strategic to position OPI to opportunistically take advantage of capital, should it be available. This will strengthen both our strong financial profile and stable cash flow that is further supported by our diverse and high credit quality tenant base. I'll now turn the call over to Chris to review leasing and operations. Chris?

儘管我們暫時暫停了資本回收計劃，但我們相信從第四季度開始可能會有一個有趣的機會來銷售一些房產。我們的 OPI 今天不會被迫出售資產，我們認為，如果有可用的資本，將 OPI 定位為機會性地利用資本是具有戰略意義的。這將增強我們強大的財務狀況和穩定的現金流，而我們多元化和高信用品質的租戶群將進一步支持我們的財務狀況和穩定的現金流。我現在將把電話轉給克里斯，以審查租賃和營運。克里斯？

Thank you, David, and good morning, everyone. We are pleased to report strong second quarter operating activity and outperformance of several market trends given the current economic challenges. We believe these results are a testament OPI's diversified portfolio, the quality of our assets and our strong tenant base of government and private sector tenants.

謝謝大衛，大家早安。鑑於當前的經濟挑戰，我們很高興地報告第二季的營運活動強勁，並且表現優於多個市場趨勢。我們相信這些結果證明了 OPI 的多元化投資組合、資產品質以及強大的政府和私營部門租戶基礎。

During the second quarter, we completed 642,000 square feet of new and renewal leasing with a weighted average rollup in rent of 3.9% a weighted average lease term of 6.1 years and leasing capital per square foot per lease year of $4.25. Year-to-date, our leasing activity has generated a weighted average rollup in rent of 4% and a weighted average lease term of 5.4 years.

第二季度，我們完成了 642,000 平方英尺的新租賃和續租租賃，加權平均租金上漲 3.9%，加權平均租賃期限為 6.1 年，每個租賃年每平方英尺的租賃資本為 4.25 美元。今年迄今為止，我們的租賃活動使租金加權平均上漲了 4%，加權平均租賃期限為 5.4 年。

We ended the quarter with occupancy of 91.7%, a 20 basis point increase over the previous quarter. Notable leases executed during the quarter include a new 15-year lease with the county in Annapolis Maryland for 51,000 square feet and a roll-up in rent of over 14%. In Chantilly, Virginia, we signed a 7-year renewal with a government contractor occupying 159,000 square feet. This tenant fully occupies 1 of 3 Class A buildings owned by OPI that are located adjacent to the National Reconnaissance Office headquarters.

本季末，我們的入住率為 91.7%，比上一季成長 20 個基點。本季度執行的重要租約包括與馬裡蘭州安納波利斯縣簽訂的 51,000 平方英尺新的 15 年租約，以及超過 14% 的租金上漲。在維吉尼亞州尚蒂伊，我們與一家佔地 159,000 平方英尺的政府承包商簽署了為期 7 年的續約合約。該租戶完全佔用了 OPI 擁有的 3 棟 A 級建築中的 1 棟，這些建築位於國家偵察辦公室總部附近。

Although our total leasing volume was up 12.4% while the broader market was down 44% on a year-over-year comparison new leasing volume has lagged pre-COVID activity. However tenant tours have picked up renewal leasing continues to advance and our leasing pipeline remains active with discussions covering 2.1 million square feet with roughly 400,000 square feet of current activities that is in advanced stages of negotiation.

儘管我們的總租賃量同比增長了 12.4%，而大盤則下降了 44%，但新租賃量仍落後於新冠疫情之前的活動。然而，租戶巡演有所增加，續約租賃繼續推進，我們的租賃管道仍然活躍，討論面積達 210 萬平方英尺，其中約 40 萬平方英尺的當前活動正處於談判後期階段。

As a result, we expect to close out the year with the roll-up in rent of 3% to 5% and occupancy around 91% which is an overall improvement to our prior quarter's projections. Across our portfolio requests from tenants for changes to their footprint to support flexibility with remote work have been minimal. We believe questions around de-densification certain tenant security requirements, employee development and collaboration and the need for an office touch point are all consideration supporting the need for maintaining their office footprint.

因此，我們預計今年結束時租金將上漲 3% 至 5%，入住率將達到 91% 左右，這比我們上一季的預測有所改善。在我們的投資組合中，租戶要求改變其占地面積以支援遠距工作的靈活性的請求很少。我們認為，圍繞著降低某些租戶安全要求、員工發展和協作以及辦公室接觸點的需求等問題，都是支持維護其辦公室佔地面積的需要的考慮因素。

This has been more evident with OPI's government and government contractors, given their strategic locations and security requirements, where we continue to see renewal activity proceed without a decrease to their footprint as evidenced with our leasing results. Through RMR asset management and property management teams we continue to proactively advance conversations with tenants to discuss their real estate needs, which we believe positions our properties for long-term growth and retention given the active management of these relationships.

考慮到OPI 的政府和政府承包商的戰略位置和安全要求，這一點在他們身上表現得更為明顯，我們繼續看到更新活動在繼續進行，而他們的足跡卻沒有減少，正如我們的租賃結果所證明的那樣。透過 RMR 資產管理和物業管理團隊，我們繼續主動推動與租戶的對話，討論他們的房地產需求，我們相信，鑑於這些關係的積極管理，這將使我們的物業實現長期增長和保留。

Considering the uncertainty created by COVID we are only comfortable providing guidance on tenant move-outs for the remainder of 2020 which we expect to be around 50 basis points of annualized rent. With that SIR, we do have a known move out at the end of the 2021 first quarter that creates an interesting opportunity for OPI. It is a property located in Washington DC and accounts for 2.8% of annualized rent. We have been preparing for this move out for a while and frankly are excited to get this property back unencumbered. The property is well located within DC's Capitol Hill submarket is one Block from Union Station and we are evaluating it for a mixed-use redevelopment, which includes the addition of 2 floors. We are fine tuning our plan and will provide more detail in the later call but anticipate the outcome of result in an 8% to 10% cash-on-cash return on approximately $150 million of redevelopment costs and will create significant long-term value when the property is delivered in early 2023.

考慮到新冠疫情帶來的不確定性，我們只能放心地為 2020 年剩餘時間的租戶搬出提供指導，我們預計年化租金約為 50 個基點。有了該 SIR，我們確實會在 2021 年第一季末進行一項已知的搬遷，這為 OPI 創造了一個有趣的機會。該物業位於華盛頓特區，佔年化租金的2.8%。我們已經為搬出做準備了一段時間，坦白說，我們很高興能不受阻礙地收回這處房產。該物業位於華盛頓特區國會山子市場內，距離聯合車站僅一個街區，我們正在對其進行綜合用途重建評估，其中包括增加 2 層樓。我們正在微調我們的計劃，並將在稍後的電話會議中提供更多細節，但預計約1.5 億美元的重建成本將帶來8% 至10% 的現金回報率，並將創造巨大的長期價值。該房產將於 2023 年初交付。

There remains uncertainty around the speed of the economic recovery and long-term impact on office generally, however, we believe the diversity of our tenant base, both geographically and by industry and the financial strength of our tenants will benefit us as we manage through these uncertain times. Nearly 63% of our annualized revenue is derived from investment grade rated tenants, including almost 39% from the secured government sector, further tenants with businesses involved in essential goods or services make up 78% of annualized revenue and roughly 95% is considered low risk by industry, all of which helps to drive tenant retention and portfolio stability to sustain us during times of economic volatility.

經濟復甦的速度和對辦公室的長期影響仍然存在不確定性，但是，我們相信，我們的租戶基礎（無論是地理位置還是行業）的多樣性以及租戶的財務實力將使我們受益，因為我們可以通過這些措施進行管理。不確定的時期。我們近 63% 的年化收入來自投資級評等租戶，其中近 39% 來自受擔保的政府部門，其他涉及基本商品或服務業務的租戶佔年化收入的 78%，約 95% 被認為是低風險按行業劃分，所有這些都有助於提高租戶保留率和投資組合穩定性，從而在經濟波動時期維持我們的生存。

Before turning the call over to Matt. I wanted to comment on the recent publication of RMR's inaugural Annual Sustainability Report. This report highlights the several ESG initiatives advance across the company and corresponding milestones. Some representative examples include first OPIs Board of Trustees consists of 37% women and earns high recognition by the 2020 women on board, education and advocacy company. Second energy management programs led by RMR reduced year-over-year same-property energy by 4.9%. And lastly OPI earn the 2020 Energy Star Partner of the Year Sustained Excellence Award from the EPA in the Energy Management category.

在將電話轉給馬特之前。我想對 RMR 最近發布的首份年度永續發展報告發表評論。本報告重點介紹了整個公司推進的多項 ESG 舉措以及相應的里程碑。一些代表性的例子包括首屆 OPI 董事會由 37% 的女性組成，並獲得了 2020 年女性董事、教育和倡導公司的高度認可。RMR 主導的第二個能源管理計畫使同物業能源年減了 4.9%。最後，OPI 榮獲 EPA 能源管理類別頒發的 2020 年度能源之星合作夥伴持續卓越獎。

We are proud of these achievements and so this is further testament to RMRs expansive well connected and inform estate operating platform. I will now turn the call over to Matt Brown to provide details on our financial results. Matt.

我們為這些成就感到自豪，這進一步證明了 RMR 廣泛的、互聯互通的、資訊豐富的房地產營運平台。我現在將把電話轉給馬特布朗，以提供有關我們財務業績的詳細資訊。馬特。

Thanks, Chris, and good morning, everyone. Normalized FFO for the second quarter was $67.2 million or $1.40 per share, which beat consensus of $1.34 per share and the high end of our guidance estimate of $1.36 per share for the following reasons. An increase in NOI of $0.02 per share. Mainly due to cost savings initiatives put in place by RMR in response to the COVID-19 pandemic, a decrease in G&A expense of $0.02 per share, mainly due to a decline in our average share price in May and June, and a decrease in interest expense of $0.01 per share, mainly due to declines in LIBOR in May and June. CAD for the second quarter was $45.5 million or $0.95 per share, which resulted in a CAD payout ratio of 57.9%. In July, we declared a $0.55 per share dividend, maintaining our previous level. Our dividend is well covered, and we expected to be below our target of 75% for 2020.

謝謝克里斯，大家早安。第二季標準化 FFO 為 6,720 萬美元，即每股 1.40 美元，超出了每股 1.34 美元的共識以及我們每股 1.36 美元指導預測的上限，原因如下。每股 NOI 增加 0.02 美元。主要是由於 RMR 為應對 COVID-19 大流行而採取的成本節約舉措，每股 G&A 費用減少了 0.02 美元，這主要是由於我們 5 月和 6 月的平均股價下跌以及利息減少每股費用為0.01 美元，主要是由於5 月和6 月LIBOR 下降。第二季加幣為 4,550 萬美元，即每股 0.95 美元，加元支付率為 57.9%。7 月份，我們宣布派發每股 0.55 美元的股息，維持先前的水準。我們的股息得到了充分支付，我們預計 2020 年股息將低於 75% 的目標。

Rental income, property operating expenses, and depreciation and amortization all declined as compared to Q2 2019 due to the sale of 29 properties for aggregate proceeds of $666 million since April 1, 2019. G&A expense for the second quarter was $7.2 million compared to $8.7 million for the second quarter of 2019. The decline is mainly the result of lower business management fees paid to RMR due to lower debt levels from property dispositions since April 1, 2019, and a $0.25 decline in OPI's average share price. In addition, we incurred higher amounts of legal fees in Q2 2019 resulting from our merger with SIR. As a reminder, our business management fees paid based on the lesser of total market capitalization or assets under management and is currently being paid on total market capitalization. We believe this calculation represents a strong alignment of interest with shareholders built into our management contract with RMR. Interest expense for the second quarter was $25.2 million compared to $35.3 million in the second quarter of 2019. The decline is mainly the result of $750 million of unsecured senior note repayments since July 1, 2019. $235 million of term loans repaid since April 1, 2019 and a $113 million of secured debt repaid in 2020.

與 2019 年第二季相比，租金收入、物業營運費用以及折舊和攤銷均有所下降，原因是自 2019 年 4 月 1 日以來出售了 29 處房產，總收益達 6.66 億美元。第二季的一般管理費用為 720 萬美元，而 2019 年第二季的一般管理費用為 870 萬美元。下降的主要原因是自 2019 年 4 月 1 日以來，由於財產處置導致的債務水準降低，支付給 RMR 的業務管理費降低，以及 OPI 平均股價下跌 0.25 美元。此外，由於我們與 SIR 合併，我們在 2019 年第二季產生了更高金額的法律費用。需要提醒的是，我們的業務管理費是根據總市值或管理資產中的較小者支付的，目前是根據總市值支付的。我們相信這項計算代表了我們與 RMR 的管理合約中所包含的股東利益的緊密結合。第二季的利息支出為 2,520 萬美元，而 2019 年第二季的利息支出為 3,530 萬美元。下降的主要原因是自 2019 年 7 月 1 日以來無擔保優先票據償還額為 7.5 億美元。自 2019 年 4 月 1 日起償還了 2.35 億美元的定期貸款，並於 2020 年償還了 1.13 億美元的擔保債務。

Turning to property level results for the quarter, for the second quarter same property cash basis NOI increased $2.4 million or 2.5% compared to the second quarter of 2019, which beat the high end of our guidance range of 1.5%. The increase was driven by an increase in cash received from contractual rent of $1.1 million, which is primarily the result of free rent expiring and decreases in property operating expenses. In total, property operating expenses decreased $1.3 million which is made up of $1.7 million of cost savings initiatives implemented by RMR in response to the COVID-19 pandemic in the areas of utility, cleaning and trash removal offset by increases in insurance premiums in real estate taxes. Although, real estate taxes have increased OPI has successfully saved over $1.5 million dollars from RMR as real estate tax abatement program in 2020.

談到本季的房地產水平結果，與 2019 年第二季度相比，第二季度相同房地產現金基礎 NOI 增加了 240 萬美元，即 2.5%，超出了我們指導範圍 1.5% 的上限。這一增長是由於從合約租金中收到的現金增加了 110 萬美元，這主要是免費租金到期和物業營運費用減少的結果。總體而言，物業營運費用減少了130 萬美元，其中包括RMR 為應對COVID-19 大流行而在公用事業、清潔和垃圾清除領域實施的170 萬美元成本節約舉措，但被房地產保險費的增加所抵消稅。儘管房地產稅有所增加，但作為 2020 年房地產稅減免計劃，OPI 已成功從 RMR 中節省了超過 150 萬美元。

While the parking income which represents less than 2% of rental income decreased approximately $500,000 on a sequential basis, which was in line with our expectations, the cost savings as a result of COVID-19 exceeded our expectations and contributed to our same property cash basis NOI growth in excess of our estimate.

雖然佔租金收入不到2% 的停車收入環比減少了約50 萬美元，這符合我們的預期，但COVID-19 帶來的成本節省超出了我們的預期，並為我們相同的物業現金基礎做出了貢獻NOI 成長超出我們的預期。

This is a testament to the conscious and thoughtful efforts to managing expenses by RMR in order to preserve NOI and improve profitability in a period of lower Office utilization. Based on our current forecast, including estimates of G&A expense, which can be challenging due to the volatility of our share price in Q3 NOI, which the pandemic also makes uncertain, we expect normalized FFO to be between $27 and $29 per share for the third quarter of 2020 and we expect our third quarter same property cash basis NOI growth to be between 1% and 3% as compared to the third quarter of 2019.

這證明了 RMR 在管理費用方面有意識且深思熟慮的努力，以便在辦公室利用率較低的時期保持 NOI 並提高盈利能力。根據我們目前的預測，包括一般管理費用的估計（由於第三季NOI 的股價波動，疫情也帶來了不確定性，這可能具有挑戰性），我們預計第三季正常化的FFO 將在每股27 美元至29 美元之間2020 年第三季度，我們預計第三季度同物業現金基礎 NOI 增長將比 2019 年第三季度在 1% 至 3% 之間。

As it relates to the COVID-19 pandemic Q2 rent collections were strong with 98% of rent obligations collected and 99% collected after adjusting for granted rent deferrals for the quarter. As of July 27th 97% of July rent obligations were collected and 98% collected after adjusting for granted rent deferrals for the month.

由於與 COVID-19 大流行相關，第二季的租金收取強勁，已收取 98% 的租金義務，並在調整本季準許的租金遞延後收取了 99% 的租金。截至 7 月 27 日，7 月份租金義務的 97% 已收回，在調整當月準許租金延期後，已收回 98%。

During our Q1 earnings call, we reported that OPI had granted rent deferrals to 18 tenants, totaling $1.4 million as of July 27th, the number of granted requests has grown modestly to 23 tenants. The total amount of rent deferred to date is $2.5 million, which represents 88 basis points of the contractual cash revenue over the period of April through September. Generally, these deferrals include one month of base rent in exchange for 12 increased monthly payments beginning in the fall of 2020. Based on the April accounting guidance related to rent relief these rent deferrals have not impacted our revenues. However, they are temporarily reducing our cash flows. To date, no rent has been forgiven or abated. Our tenant watchlist currently includes 18 tenants, of which 11 are not paying their rents obligations and have not been granted rent deferrals, these 11 tenants are mainly building amenity tenants. In the health and fitness business and quick service restaurant business and represent 20 basis points of OPIs total square feet and approximately $200,000 in monthly contractual rent. As a result, for the second quarter, we recorded revenue reserves of $962,000 or 66 basis points of Q2 rental income, including $660,000 of AR and $302,000 of straight line receivables, which is an increase from the previous quarter. Turning to the balance sheet and capital expenditures. In June, we issued $150 million of 6.375% senior unsecured notes, due 2015 and in July, we issued an additional $12 million of these notes. In connection with the underwriters exercise of their over-allotment option. These notes can be prepaid without penalty starting in June 2025. At June 30th, we had approximately $575 million of liquidity including $550 million of availability on our $750 million unsecured revolving credit facility. At June 30, our net debt annualized adjusted EBITDAre was 5.9 times, which remains below our target leverage range for the third consecutive quarter. We currently have $570 million of availability on our revolving credit facility and only $40 million of debt maturities until 2022. Our balance sheet remains strong and we have ample liquidity to weather the current disruptions facing the real estate industry. We spent $21.9 million on recurring capital during the second quarter, including $10 million on building improvements and $11.9 million on leasing capital. As of quarter end, we had approximately $61.7 million of unspent leasing related capital obligations, of which 52% represents tenant improvement allowances managed by our tenants and $15.8 million as leasing capital designated in leases for future years. Based on our current forecast, we expect 2020 recurring capital expenditures to be approximately $92 million, which is consistent with our forecast shared on our Q1 earnings call and down from our initial forecast of $110 million.

在第一季財報電話會議上，我們報道稱，截至 7 月 27 日，OPI 已向 18 名租戶提供了總計 140 萬美元的租金延期，批准請求的數量已小幅增長至 23 名租戶。迄今遞延的租金總額為 250 萬美元，相當於 4 月至 9 月期間合約現金收入的 88 個基點。一般來說，這些延期包括 1 個月的基本租金，以換取從 2020 年秋季開始每月增加 12 筆付款。根據四月與租金減免相關的會計指引，這些租金遞延並未影響我們的收入。然而，他們暫時減少了我們的現金流。迄今為止，尚未免除或減少任何租金。我們的租戶觀察名單目前包括 18 名租戶，其中 11 名沒有支付租金義務，也沒有獲得租金延期，這 11 名租戶主要是建築便利設施租戶。在健康和健身業務以及快餐店業務中，佔 OPI 總平方英尺的 20 個基點，每月合約租金約為 20 萬美元。因此，第二季度我們的營收準備金為 962,000 美元，即第二季租金收入的 66 個基點，其中包括 660,000 美元的 AR 和 302,000 美元的直線應收帳款，較上一季增加。轉向資產負債表和資本支出。6 月，我們發行了 1.5 億美元、利率為 6.375% 的優先無抵押票據，將於 2015 年到期；7 月，我們又發行了 1,200 萬美元的此類票據。與承銷商行使超額配股權有關。從 2025 年 6 月開始，這些票據可以預付，無需支付罰款。截至 6 月 30 日，我們擁有約 5.75 億美元的流動資金，其中包括 7.5 億美元的無擔保循環信貸額度中的 5.5 億美元。截至6月30日，我們的淨負債年化調整後EBITDA為5.9倍，連續第三季低於我們的目標槓桿範圍。目前，我們的循環信貸額度有 5.7 億美元，而到 2022 年只有 4,000 萬美元的債務到期。我們的資產負債表仍然強勁，我們有充足的流動性來應對當前房地產行業面臨的混亂。第二季我們的經常性資本支出為 2,190 萬美元，其中 1,000 萬美元用於建築改善，1,190 萬美元用於租賃資本。截至季末，我們有約 6,170 萬美元的未動用租賃相關資本義務，其中 52% 為租戶管理的租戶改善津貼，1,580 萬美元為未來幾年租賃中指定的租賃資本。根據我們目前的預測，我們預計 2020 年經常性資本支出約為 9,200 萬美元，這與我們在第一季財報電話會議上分享的預測一致，低於我們最初預測的 1.1 億美元。

Operator, that concludes our prepared remarks. We're ready to open the call up for questions.

接線員，我們準備好的發言到此結束。我們已準備好接受提問。

(Operator Instructions) And the first question comes from Bryan Maher with B. Riley FBR.

（操作員說明）第一個問題來自 Bryan Maher 和 B. Riley FBR。

So a couple of questions. And that you touched upon this and maybe you or David can elaborate on. You have 18 tenants on the watch list, eleven not paying seems like they're kind of healthcare fitness QSR type of tenants, what's going on there. I mean, what's the plan those tenants not applying for PPP dollars are they just not wanting to pay you, how are you thinking about addressing that.

有幾個問題。你談到了這一點，也許你或大衛可以詳細說明。觀察名單上有 18 個租戶，其中 11 個未付款，看起來他們是醫療保健健身 QSR 類型的租戶，這是怎麼回事。我的意思是，那些不申請 PPP 資金的租戶有什麼計劃，他們只是不想付錢給你，你打算如何解決這個問題。

Matt, you might deal with that.

馬特，你可以處理這個問題。

Sure. One tenant for example has filed for bankruptcy in that eleven tenants that are not paying. Another example is a tenant that occupied the Gym in one of our buildings in DC and they've said to us that they don't plan to pay rent until kind of inaudible and things stabilize. So we're working actively with our tenants, some of which though with bankruptcy and just declines in business or really struggling right now.

當然。例如，一名租戶已申請破產，而十一名租戶未付款。另一個例子是，一位房客佔據了我們位於華盛頓特區的一棟大樓的健身房，他們對我們說，他們不打算支付租金，直到聽不見聲音並且情況穩定下來。因此，我們正在積極與租戶合作，其中一些租戶已經破產，只是業務下滑，或者現在確實陷入困境。

Okay. And then the...

好的。然後...

Bryan, one of the things we're being very careful of is not deferring rents where a tenants financial condition might be so bad. At the end of filing bankruptcy, we'd rather have delinquent rent that we could file a claim for versus potentially not being in a position to file that claim.

布萊恩，我們非常小心的一件事是，在租戶的財務狀況可能如此糟糕的情況下，不要推遲租金。在申請破產結束時，我們寧願對拖欠的租金提出索賠，也不願可能無法提出索賠。

Got it. And kind of moving on to the capital recycling program and I think you made the comment that it was paused but there were a few assets that may be you might be sold or there is an opportunity to potentially sell in the fourth quarter. David, as you look out over the next kind of 6 to 18 months with COVID and other things going on. What is your current view as to how that might play out as measured in maybe hundreds of millions of dollars $100,$200, $300 over that period of time and what kind of capital rate differentials, should we expect between what you might acquire and what you might be able to sell assets for.

知道了。接下來是資本回收計劃，我認為您曾評論說該計劃已暫停，但您可能會出售一些資產，或者有機會在第四季度出售。大衛，請您展望未來 6 到 18 個月的新冠疫情和其他情況。您目前對這段時間可能以數億美元（100、200、300 美元）衡量的情況有何看法，以及我們是否應該預期您可能獲得的資產與您實際獲得的資產之間存在什麼樣的資本利率差異？也許能夠出售資產。

Yes, those are good questions, Bryan, so you know I would say during the second quarter the only potential acquisition opportunities that we have seen have been what I would call very core real estate opportunities and pricing for those very core assets really hasn't changed a whole lot from pre-COVID levels there has been very few transactions. For what I would call non-core or maybe value added. We know we have some opportunities to sell some assets where we think the future capital is not as economic as we'd like it to be. And so we have been more focused on looking at our capital recycling program by comparing the 5-year average cash contribution from assets that we sell versus assets that we buy and what I mean by the 5-year cash contribution is NOI minus capital. So we're really looking at what I would consider CAD to the company and we believe that we can sell properties with a 1% to 2% differential in that 5-year cash contribution that's that what we're buying is contributing 100 to 200 basis points more in annualized cash contribution than what we're selling and so we think we can do this accretively. Now if we get into the market and we find that there is not attractive bids for what we're selling, we won't sell, but our goal would be over the next 18 months to continue our $300 million annual cash with our capital recycling program. That makes sense.

是的，這些都是很好的問題，布萊恩，所以你知道我會說，在第二季度，我們看到的唯一潛在收購機會是我所說的非常核心的房地產機會，而這些非常核心資產的定價確實沒有與新冠疫情之前的水平相比發生了很大變化，交易量非常少。我稱之為非核心或增值。我們知道，我們有機會出售一些我們認為未來資本並不像我們希望的那樣經濟的資產。因此，我們更加專注於透過比較我們出售的資產與我們購買的資產的 5 年平均現金貢獻來審視我們的資本回收計劃，我所說的 5 年現金貢獻是 NOI 減去資本。因此，我們正在真正考慮我對公司的加元看法，我們相信我們可以在 5 年現金貢獻中以 1% 到 2% 的差額出售房產，也就是說，我們購買的資產貢獻 100 到 200年化現金貢獻的基點比我們銷售的基點更多，因此我們認為我們可以逐步做到這一點。Now if we get into the market and we find that there is not attractive bids for what we're selling, we won't sell, but our goal would be over the next 18 months to continue our $300 million annual cash with our capital recycling程式.這就說得通了。

Yes. Great. And then I was going to ask you about your Denver property that you acquired them a little bit more interested in your comments on the property near Union inaudible and what you might be doing there. Can you just give us a little bit more color on what that asset currently is how much you might spend, I think you said it might come back online around 2023. Just a little bit more color on that would be really helpful.

是的。偉大的。然後我要問你關於你在丹佛的房產，你買了他們，他們對你對聯合附近的房產的評論更感興趣，聽不清，以及你可能在那裡做什麼。您能否給我們更多關於該資產目前您可能花費多少的信息，我想您說過它可能會在 2023 年左右重新上線。只要多加一點顏色就會非常有幫助。

Sure, Chris, do you want to address that.

當然，克里斯，你想解決這個問題嗎？

Sure. Hey, Bryan. So this is a building, as noted in Washington DC about a Block from Union Station, it's largely occupied by the GSA, who is going to be relocating to another location to consolidate with other agencies. And so in doing so, we've been looking at opportunities and had proactively over the last couple of years purchased density credits to grow the building by 2 floors or working up -- kind of close to about 125,000 square feet of density credits and really this is a fluid process, so we're really focused on, I guess a handful of options, one, we talked about this mixed use option, which includes office retail and some form of maybe more by family component and the other option that we're also focus on is just kind of a single tenant lease to kind of more of the existing building with the GSA and we're actually in conversations with the GSA for potential user that could take the entire building.

當然。嘿，布萊恩。正如華盛頓特區有關聯合車站的一個街區所指出的那樣，這是一棟建築，它主要由 GSA 佔用，而 GSA 將搬遷到另一個地點以與其他機構合併。因此，在這樣做的過程中，我們一直在尋找機會，並在過去幾年中主動購買了密度信用額度，將建築物增加 2 層或增加 - 接近約 125,000 平方英尺的密度信用額度，並且確實這是一個流動的過程，所以我們真正關注的是，我想有幾個選項，其中之一，我們討論了這種混合用途選項，其中包括辦公零售和某種形式的家庭組件，以及我們認為的其他選項我們也關注的是單一租戶向 GSA 租賃更多現有建築，我們實際上正在與 GSA 就可能佔用整棟建築的潛在用戶進行對話。

But that's a process we have to go through it. It's a competitive bid process and will still require capital and so that's probably the kind of the lesser NOI play but lesser risk play. And then on the mixed-use side, again, we would get additional square footage. I think we get higher rents and we're also in some active conversations with tenants that we think could be meaningful for kicking off a project. And so the timing is, is if the GSA still vacates by the end of Q1 2021, we should be well positioned to proceed with the desired option and anticipate that delivery can happen in early 2023.

但這是我們必須經歷的過程。這是一個競爭性的投標過程，仍然需要資金，因此這可能是一種 NOI 較小但風險較小的遊戲。然後在混合用途方面，我們將再次獲得額外的平方英尺。我認為我們獲得了更高的租金，而且我們也在與租戶進行一些積極的對話，我們認為這對於啟動專案可能有意義。因此，時間安排是，如果 GSA 在 2021 年第一季末仍然騰出，我們應該能夠很好地繼續進行所需的選擇，並預計可以在 2023 年初交付。

And the next question comes from Adam Gabalski with Morgan Stanley.

下一個問題來自摩根士丹利的 Adam Gabalski。

I just wanted to ask a little bit more about the assets that you said might be targeted for sale I I'd like you said, previously you guys don't really need to sell any more assets lever to sort of below your target and it's been there for a while now.

我只是想多問一些關於你所說的可能目標出售的資產，我想聽你說，以前你們真的不需要出售更多的資產槓桿來低於你的目標，這是已經在那裡有一段時間了。

But so these assets that sort of might come up for sale and might sort of become part of the capital recycling, are these assets where the fundamentals and the cash flow picture has changed meaningfully over the sort of next 5 years, amid COVID, or these sort of assets that were always potentially slated for sale and just sort of how that the potential opportunity for more sales kind of came about.

但是，這些資產可能會被出售，並可能成為資本循環的一部分，這些資產的基本面和現金流狀況在未來 5 年內，在新冠疫情期間或這些情況下發生了有意義的變化。總是有可能被出售的資產，以及更多銷售的潛在機會是如何產生的。

Sure. It's a good question. And the short answer is, these are assets that we had targeted for the next phase of our capital recycling program but put them on pause because there is --- this disruption in the property transaction market due to COVID. So they are not a resolved the performance of the properties are not a result of COVID, but they are assets that we identified probably 9 months ago for potential capital recycling. In the fourth quarter 2019, we opportunistically sold a building in Houston as part of the hedge. Quarter campus for Noble Energy, it wasn't an asset that we were marketing to sell, but the tenant came to us and basically said we'd like to buy and they were willing to pay a price for that property that we thought was very high relative to long-term value. Fast forward to a couple of weeks ago Noble being acquired by Chevron and that building has high potential of going Vegas and so what we're trying to do at OPI is position us to be opportunistic. And the only way we can be opportunistic is to have properties in the market, find out how the market prices, those assets and if we find the pricing acceptable we will transact. If we don't, we'll pause and begin and wait. But I think that is the right strategic move for the company.

當然。這是一個好問題。簡而言之，這些資產是我們下一階段資本回收計畫的目標資產，但由於新冠肺炎疫情對房地產交易市場造成了乾擾，因此暫停了它們。因此，這些資產的表現並不是新冠疫情造成的，但它們是我們大約 9 個月前確定的潛在資本回收資產。2019 年第四季度，我們趁機出售了休士頓的一棟大樓，作為對沖的一部分。Noble Energy 的四分之一園區，這不是我們行銷要出售的資產，但租戶來找我們，基本上說我們想購買，他們願意為我們認為非常昂貴的房產支付價格。相對於長期價值較高。快進到幾週前，Noble 被雪佛龍收購，該建築具有進入拉斯維加斯的巨大潛力，因此我們在 OPI 所做的就是讓我們處於機會主義的位置。我們投機取巧的唯一方法就是在市場上擁有房產，了解這些資產的市場價格，如果我們發現價格可以接受，我們就會進行交易。如果我們不這樣做，我們將暫停並開始等待。但我認為這對公司來說是正確的策略舉措。

Got it. Makes sense. And then I guess just more broadly, I mean it seems like you guys are becoming very flexible as far as sort of capital allocation priorities with the new sort of development project and the acquisition in Denver. I'm just wondering like, is there any chance that you guys just continue to sort of shake-up that mix and maybe re-invest more capital into buildings that were slated for sale or maybe even institute new buyback, share buybacks or anything like that. And just sort of broadly, how COVID in the current environment that we're in has shifted your capital allocation priorities.

知道了。說得通。然後我想更廣泛地說，我的意思是，就新型開發案和丹佛收購的資本分配優先事項而言，你們似乎變得非常靈活。我只是想知道，你們是否有機會繼續調整這種組合，也許將更多的資金重新投資到計劃出售的建築物上，甚至可能進行新的回購、股票回購或類似的事情。從廣義上講，在我們目前所處的環境下，新冠疫情如何改變了你的資本配置優先順序。

Yes, it's a good question, I wouldn't necessarily say COVID has shifted our capital allocation priorities. But we spent 18 months repositioning our balance sheet and putting ourselves in a position where we could be more strategic with allocating capital COVID kind of put that on hold, but again we want to be opportunistic generate good returns with our capital. We have done across the RMR platform, a lot of development and redevelopment. So we have that capability and assets that are located in core markets where we believe we can grow rents, long term we would much rather redevelop those assets, then we would sell them vacant and so I think you will see in our portfolio over the next 3 to 5 years, we have probably 3 maybe 4 potential interesting redevelopment opportunity. That we are exploring now to be able to position ourselves to make a strategic decision.

是的，這是一個很好的問題，我不一定會說新冠疫情改變了我們的資本配置優先順序。但我們花了18 個月的時間重新定位了我們的資產負債表，使我們能夠更加戰略性地分配資本，新冠疫情讓這一計劃被擱置，但我們再次希望利用我們的資本抓住機會，創造良好的回報。我們在RMR平台上做了很多開發和再開發。因此，我們擁有位於核心市場的能力和資產，我們相信我們可以提高租金，從長遠來看，我們寧願重新開發這些資產，然後我們將空置它們，所以我認為您將在接下來的投資組合中觀看到3到5年，我們可能有3到4個潛在的有趣的重建機會。我們現在正在探索如何定位自己以做出策略決策。

Got it. That's really helpful. And I guess just one more from me, I mean the balance sheet is in really good shape, as you guys have said. I'm just wondering how does--how does this environment sort of change your, target leverage does it change at all, are you guys planning to be sort of more conservative for the next year or 2 and then maybe be willing to let leverage take out back charge sort of mid to high-end of your prior stated ranges. What are the sort of latest thoughts on how this environmental affects -- effects your leverage targets and the available liquidity to continue that sort of capital recycling.

知道了。這真的很有幫助。我想我再說一句，我的意思是，正如你們所說，資產負債表的狀況非常好。我只是想知道這種環境如何改變你的目標槓桿率它有沒有改變，你們是否計劃在未來一兩年變得更加保守，然後也許願意讓槓桿率取出先前規定範圍的中高端的欠費。關於這種環境如何影響您的槓桿目標和繼續進行這種資本回收的可用流動性，最新的想法是什麼？

Yes, it's a good question, we don't have this real interest right now, issuing equity to take our leverage down. So our primary tool is capital recycling and so I think we haven't changed our guidelines, as it relates to target leverage is still rate, is that 6% to 6.5% we're fine being modestly below that, but our ability to be successful, we're selling assets, we'll have a big impact on how we buy assets and how we address the development. I hope that helps answer your question.

是的，這是一個很好的問題，我們現在沒有真正的興趣，發行股票來降低我們的槓桿率。因此，我們的主要工具是資本回收，所以我認為我們沒有改變我們的指導方針，因為它與目標槓桿率仍然有關，即 6% 到 6.5%，我們可以稍微低於這個水平，但我們有能力如果我們成功的話，我們出售資產，我們將對我們如何購買資產以及我們如何解決開發問題產生重大影響。我希望這有助於回答您的問題。

Yes, absolutely.

是的，一點沒錯。

And the next question comes from Michael Carroll with RBC Capital Markets.

下一個問題來自加拿大皇家銀行資本市場的麥可‧卡羅爾。

David, I just want to talk a little bit about your comments about the development, I guess first you said there was what a handful of developments that you could pursue this currently in the portfolio. I guess what's the timing there and would you need to have a tenant move-out like the one, do you feel free to pursue those projects or what's the expectation.

大衛，我只想談談您對開發的評論，我想首先您說您目前可以在投資組合中追求一些開發。我猜想那裡的時間是什麼時候，您是否需要像這樣的租戶搬出，您是否可以自由地追求這些項目或期望是什麼。

Sure. What we've got as Chris talked about 20 Massachusetts Avenue, which would be probably kick off beginning of the second quarter of 2021. We have 2 other buildings that are currently occupied where one we know the tenant will vacate, it's in a high growth market where we believe we could substantially grow rents, that would likely be something that begins more 2023 and then we've got an asset in the Boston market, where we are not sure whether when or if the tenants will vacate. But it is located and in an area of Boston, where we could do a very interesting redevelopment. But that is probably more 2024, 2025. So these are reasonably well spaced, which we think makes a lot of strategic sense for the company.

當然。克里斯談到馬薩諸塞大道 20 號時我們了解到的情況，該項目可能會在 2021 年第二季度初啟動。我們還有另外2 棟建築目前已被佔用，其中一棟我們知道租戶將騰出，它位於一個高增長市場，我們相信我們可以大幅提高租金，這可能會在2023 年開始，然後我們就擁有了一項資產在波士頓市場，我們不確定租戶何時或是否會搬出去。但它位於波士頓的一個地區，我們可以在那裡進行非常有趣的重建。但這可能是 2024 年、2025 年的事了。因此，這些區域的間隔相當合理，我們認為這對公司具有很大的戰略意義。

Okay. And then with the -- and I believe that's the DOJ that's in the Massachusetts Avenue building that's moving out. I mean do they have a building that they are planning on moving to. I guess what's the chances that they will holdover and stay in there a little bit longer through 2021.

好的。然後，我相信位於馬薩諸塞大道大樓的司法部即將搬出。我的意思是他們有計劃搬到的建築物嗎？我猜想他們堅持到 2021 年並在那裡待得更久的機會有多大。

Yes, it's actually CIF and they have been working on a build-to-suit for a while, we've actually been, I guess, working with them for the last 3 years to get them out of the building and so they've -- we've done short-term extensions with them during that time period to accommodate their build-to-suit.

是的，這實際上是到岸價格，他們已經致力於量身定制有一段時間了，我想，我們實際上在過去的三年裡一直在與他們合作，讓他們離開大樓，所以他們已經— —在那段時間裡，我們與他們進行了短期延期，以適應他們的客製化需求。

Okay. And then is that build-to-suit done and ready for them to move in the beginning of next year.

好的。然後，客製化工作就完成了，準備在明年初搬遷。

Chris, you want to address that.

克里斯，你想解決這個問題。

Yes, it is complete. They're already starting -- they have already contracted to pay rent on that building and so it's just a function of them phasing out and moving over. So at this stage there is no, if there is no reason to believe that they would stay past lease expiration at the end of Q1.

是的，它已經完成了。他們已經開始了——他們已經簽訂了支付那棟大樓租金的合同，所以這只是他們逐步拆除和搬遷的一個功能。因此，在現階段，如果沒有理由相信他們會在第一季末租約到期後留下來，那就沒有。

Okay. And then I guess, Chris, I hear you correctly in your remarks about that there is a tenant looking at that Massachusetts Avenue building. So there is a debate. If you want to or if you can lease it to somebody else or pursue this redevelopment.

好的。然後我想，克里斯，我正確地聽到你所說的，有一個房客正在看馬薩諸塞大道的那棟大樓。所以有一場爭論。如果您願意或您可以將其出租給其他人或進行重建。

That's correct. I think with either option, it's going to be a significant investment. I think just to reposition for a full building user for a long-term lease in the neighborhood of 15 plus years or mixed use development is going to require kind of substantial development on other side.

這是正確的。我認為無論哪種選擇，這都將是一項重大投資。我認為，僅僅為了在附近 15 年以上的長期租賃或混合用途開發而為完整的建築用戶重新定位，就需要在另一側進行實質性的開發。

Yes. It’s an interesting opportunity Mike because clearly doing a government lease for 15 years is a less risky opportunity, but it provides a much lower return, and so we're just going to have to address that as both progress.

是的。麥克，這是一個有趣的機會，因為顯然，15 年的政府租賃是一個風險較小的機會，但它提供的回報要低得多，因此我們必須在兩者取得進展時解決這個問題。

Okay. And then the government hasn't awarded that to you yet, so that you're still waiting on their decision there.

好的。然後政府還沒有把這個授予給你，所以你還在等待他們的決定。

That is correct.

那是對的。

Okay. And then I guess last one for me is the mixed-used option. I'm assuming that you would pursue that more on a speculative basis and I guess are you prepared to do that if the market remains a little bit more uncertain like it is today.

好的。然後我想對我來說最後一個是混合使用的選項。我假設你會更多地在投機的基礎上追求這一點，我想如果市場仍然像今天一樣更加不確定，你是否準備好這樣做了。

Chris, do you want to answer them.

克里斯，你想回答他們嗎？

Yes, I think that. Yes, I mean, it would be on a speculative basis. But as I noted, we are in various levels of conversations with tenants that we believe, Dave, could help accelerate some leasing on the onset, but I think idea -- ideally if we don't have. I would say kind of this GSA user teed up and ready to go. We would pursue the mixed-use option, it provides kind of a more attractive yields. And I think provides a little bit more certainty around leasing long term than waiting for another large user as a full building occupant.

是的，我是這麼認為的。是的，我的意思是，這將是基於推測。但正如我所指出的，我們正在與租戶進行各種級別的對話，戴夫，我們相信這可以幫助加速一些租賃的開始，但我認為想法 - 理想情況下，如果我們沒有的話。我想說的是，這位 GSA 用戶已做好準備，準備出發。我們會追求混合用途的選擇，它提供了更具吸引力的效益。我認為，與等待另一個大用戶完全佔用建築物相比，長期租賃提供了更多的確定性。

But Mike, we think we could. The next use option. We think we could be 50% pre-leased before shovels are in the ground.

但是麥克，我們認為我們可以。下一個使用選項。我們認為，在鏟子落地之前，我們可以預租 50%。

Okay. Great. Thank you.

好的。偉大的。謝謝。

And next question comes from Omotayo Okusanya with Mizuho.

下一個問題來自 Mizuho 的 Omotayo Okusanya。

Just wondering if you guys can provide an update on Technicolor and tailored brands. It looks like Technicolor, the annualized revenue in your top tenant list declined a bit and moved to number 13 from number 10. Just curious about the function of their recent restructuring and on tailored brands. I know there is some reporting on store closures and layoffs. So just curious about any updates there.

只是想知道你們是否可以提供有關 Technicolor 和定製品牌的最新資訊。看起來像Technicolor，你們的頂級租戶名單中的年化收入有所下降，從第10名移至第13名。只是好奇他們最近的重組和定製品牌的功能。我知道有一些關於商店關閉和裁員的報告。所以只是好奇那裡有什麼更新。

Yes, Chris, do you want to address that.

是的，克里斯，你想解決這個問題嗎？

Sure. I'm here on Technicolor. You know with their restructuring it was a restructuring, primarily around debt obligations and it was largely impacted kind of its Europeans parent on holdings. And so it didn't have a direct impact on the kind of the US entity side, which is what we have with our lease. And so that's actually progressed based on the plans submitted and they've received certain approvals through the various milestones actually as early as this week.

當然。我在 Technicolor 上。你知道，他們的重組是重組，主要圍繞著債務義務，很大程度上受到其歐洲母公司持股的影響。因此，它對美國實體方面沒有直接影響，這就是我們的租賃。因此，這實際上是根據提交的計劃取得進展的，而且他們實際上早在本週就通過各個里程碑獲得了某些批准。

So what it's going to do is it's going to give them additional liquidity and access to capital to implement or manage through their business plan so I think we feel relatively optimistic based on kind of the restructuring and the approval that their business should continue kind of as proposed. For tailored brand

因此，它將為他們提供額外的流動性和獲得資本的機會，以實施或管理他們的業務計劃，所以我認為，基於重組的類型和批准他們的業務應該繼續下去，我們感到相對樂觀。建議的。為品牌量身定制

Chris, Can I interrupt you for a second?

克里斯，我可以打擾你一下嗎？

You can.

你可以。

Yes. So Technicolor separate from their corporate restructure in France, we did a renegotiation of their rent of their lease with us in in Huntsville, Alabama, and that is what resulted in the -- them dropping from number 10 to number 13.

是的。因此，Technicolor 與他們在法國的公司重組分開，我們在阿拉巴馬州亨茨維爾與我們重新談判了他們的租賃租金，這就是導致他們從第 10 名下降到第 13 名的原因。

Okay. Great.

好的。偉大的。

I am sorry, Chris go ahead with tailor brand

對不起，克里斯繼續做裁縫品牌

Yes. Now for tailor brand I guess a couple of different things, one there is, the news about kind of a potential bankruptcy that they anticipate in Q3, which is something that we're monitoring. They [have furlough] a lot of their employees and kind of some of the challenges with their brick and mortar stores reopening as just kind of making a little bit more difficult for them to continue with their current plan but the building that we have in Houston is their corporate headquarters, I think we view that as mission critical.

是的。現在，對於裁縫品牌來說，我猜有幾件不同的事情，其中​​之一是他們預計在第三季度可能會破產的消息，這是我們正在監控的事情。他們讓許多員工休假，實體店重新開業帶來了一些挑戰，這讓他們繼續目前的計劃變得更加困難，但我們在休士頓的大樓是他們的公司總部，我認為我們認為這是關鍵任務。

We've been having conversations with the local team on kind of any indication about what they might do. And I think, at this stage, it's business as usual until I think some of their filing occurs in Q3. And so it's something we are monitoring closely, but with no real indication on whether or not there might be an impact to the buildings that we have with them.

我們一直在與當地團隊進行對話，以了解他們可能採取的行動。我認為，在這個階段，一切照常進行，直到我認為他們的一些文件發生在第三季。因此，我們正在密切監視這一點，但沒有真正的跡象表明這是否會對我們擁有的建築物產生影響。

Okay. That’s helpful. And did you guys see any uptake in shorter term renewals in the quarter and may be from non-government tenants, it looks like the weighted average lease term on renewals is about 5.1 years, but just wondering if that might have been skewed by any larger long-term renewals. I know in your prepared remarks, you mentioned a 7-year renewal.

好的。這很有幫助。你們是否看到本季短期續租有任何成長，並且可能來自非政府租戶，看起來續租的加權平均租賃期限約為 5.1 年，但只是想知道這是否可能受到任何更大的扭曲長期續訂。我知道你在準備好的發言中提到了7年續約。

Yes. So this this is Chris. I guess there's a couple of short-term renewals that we did for the quarter and I would say that in both cases it's consistent with just kind of the environment where these tenants reside and so for example, we did. So we did 2 short-term renewals between 3 and 4 years of term.

是的。這是克里斯。我想我們在本季度進行了幾次短期續約，我想說，在這兩種情況下，這都與這些租戶居住的環境一致，所以我們就這樣做了。因此，我們在 3 至 4 年任期之間進行了 2 次短期續約。

One of them, with a building a tech company in Austin, Texas. This is a tenant who has been in the building for 10 plus years and over the last, I would say, 2 or 3 renewal has only done 3-year deal and I think that's consistent with what we see a lot happen and often in general.

其中之一是在德克薩斯州奧斯汀建立一家科技公司。這是一位已經在大樓裡住了10 多年的租戶，在過去，我想說，2 或3 次續約只完成了3 年的交易，我認為這與我們看到的許多發生的事情是一致的，而且通常是普遍的。

And so it's not a surprise that they did 3-year deal and I think when you're dealing with a market like Austin where rents have grown tremendously over this last cycle, where this positioned us to do is take advantage of the upside and so for example with this most recent renewal, we had a 23% increase and our roll-up in rent. And so I think that's just kind of shows in this particular case, how there is a benefit and then the other building is with the government in California and this renewal was closer to 4 years and it was really just part of a strategic plan as they put together their overall kind of global plan for the building long-term, but we don't view that as any specific risk with its strategic location.

因此，他們簽訂了三年協議並不奇怪，我認為當你面對像奧斯汀這樣的市場時，那裡的租金在上一個週期中大幅增長，這讓我們要做的就是利用上行空間，所以例如，在最近的續約中，我們的租金上漲了23%，而且租金也增加了。所以我認為這只是在這個特殊案例中展示瞭如何帶來好處，然後另一棟建築是由加州政府負責的，這次更新接近 4 年，這實際上只是戰略計劃的一部分，因為他們為該建築制定了長期的整體全球計劃，但我們並不認為其戰略位置有任何具體風險。

Yes. So generally, yes we always have some short-term renewals. When we do our quarterly leasing, but there is nothing that occurred during the second quarter that we would say is COVID-19 impacted because people are trying to evaluate what their space needs. There was nothing out of the ordinary.

是的。所以一般來說，是的，我們總是有一些短期續約。當我們進行季度租賃時，但第二季度發生的任何事情都沒有受到 COVID-19 的影響，因為人們正在嘗試評估他們的空間需求。沒有什麼異常。

Okay. Great. That's helpful. And then one last one. You haven't touched on this earlier, how should we think about G&A going forward given that it's been closer to 7 million in last few quarters, I think you guys previously guided to a wider range of 79 million, so just curious how we should think about that in the back half.

好的。偉大的。這很有幫助。然後是最後一張。你們之前沒有談到這一點，鑑於過去幾個季度接近 700 萬，我們應該如何考慮未來的 G&A，我想你們之前指導到了更廣泛的 7900 萬，所以只是好奇我們應該如何想想後半部分。

Matt, do you want to address that, please?

馬特，你想解決這個問題嗎？

Yes. So the Q2 G&A expense was $7.2 million as I covered in my remarks, based off where OPI share price is trading currently that remains a good run rate for Q3 and Q4.

是的。因此，正如我在發言中所述，第二季的一般管理費用為720 萬美元，這是基於OPI 股價目前的交易情況，這對於第三季和第四季來說仍然是一個良好的運行率。

And at this time there are no more questions. So I would like to return the floor to David Blackman for any closing comments.

而此時已經沒有更多的問題了。因此，我想請大衛布萊克曼 (David Blackman) 發言以徵求結束意見。

Thank you, operator, and thank you for joining us today.

謝謝您，接線員，也謝謝您今天加入我們。

Before we disconnect. I'd like to thank our teams across the RMR platform for their exceptional efforts and dedication to our business in the face of the global hardship, our strong second quarter earnings and operating activity is the result of your dedication and exceptional efforts. So thank you. Operator, that concludes our call.

在我們斷開連接之前。我要感謝 RMR 平台上的團隊在全球經濟困難的情況下為我們的業務做出的傑出努力和奉獻精神，我們第二季度強勁的盈利和運營活動是你們奉獻和傑出努力的結果。所以謝謝。接線員，我們的通話結束了。