RMR Group Inc (RMR) 2023 Q2 法說會逐字稿

Good morning, and welcome to the RMR Group Fiscal Second Quarter 2023 Earnings Conference Call. (Operator Instructions) Please note, this event is being recorded.

早安，歡迎參加 RMR 集團 2023 年第二季財報電話會議。 （操作員說明）請注意，正在記錄此事件。

I would now like to turn the conference over to Melissa McCarthy, Manager of Investor Relations. Please go ahead.

我現在想將會議交給投資者關係經理梅麗莎·麥卡錫 (Melissa McCarthy)。請繼續。

Good morning, and thank you for joining RMR's Second Quarter of Fiscal 2023 Conference Call. With me on today's call are President and CEO, Adam Portnoy; and Chief Financial Officer, Matt Jordan. In just a moment, they will provide details about our business and quarterly results, followed by a question-and-answer session. 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.

早安，感謝您參加 RMR 2023 財年第二季電話會議。與我一起參加今天電話會議的是總裁兼執行長 Adam Portnoy；和財務長馬特喬丹。稍後，他們將提供有關我們業務和季度業績的詳細信息，然後進行問答環節。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。

Today's conference call contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other securities laws. These forward-looking statements are based on RMR's beliefs and expectations as of today, May 4, 2023, 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 the 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, which can be found on our website at www.rmrgroup.com. Investors are cautioned not to place undue reliance upon any forward-looking statements.

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。這些前瞻性陳述是基於 RMR 截至今天（2023 年 5 月 4 日）的信念和預期，實際結果可能與我們的預測有重大差異。該公司不承擔修改或公開發布對今天電話會議中前瞻性陳述的任何修改結果的義務。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提交的文件中，您可以在我們的網站 www.rmrgroup.com 上找到該文件。投資者應注意不要過度依賴任何前瞻性陳述。

In addition, we may discuss non-GAAP numbers during this call, including adjusted net income, adjusted earnings per share, adjusted EBITDA and adjusted EBITDA margin. A reconciliation of net income determined in accordance with U.S. generally accepted accounting principles to adjusted net income, adjusted earnings per share, adjusted EBITDA and the calculation of adjusted EBITDA margin can be found in our financial results.

此外，我們可能會在本次電話會議中討論非 GAAP 數據，包括調整後淨利潤、調整後每股收益、調整後 EBITDA 和調整後 EBITDA 利潤率。在我們的財務表現中可以找到根據美國公認會計原則確定的淨利潤與調整後淨利潤、調整後每股收益、調整後 EBITDA 和調整後 EBITDA 利潤率計算的調節表。

On today's call, we will discuss the planned merger between OPI and DHC in our prepared remarks. OPI and DHC have not yet filed a preliminary joint proxy and registration statement with the SEC, and therefore, we will not be taking questions about the merger. In addition, we will discuss the planned acquisition of TA by BP. As a special meeting of TA shareholders to approve the merger takes place on May 10, we will not be taking questions on this transaction either.

在今天的電話會議上，我們將在準備好的演講中討論 OPI 和 DHC 之間的合併計劃。 OPI 和 DHC 尚未向 SEC 提交初步聯合委託書和註冊聲明，因此，我們不會回答有關合併的問題。此外，我們也將討論BP收購TA的計畫。由於批准合併的 TA 股東特別會議將於 5 月 10 日舉行，因此我們也不會就此交易提出問題。

And now I'd like to turn the call over to Adam.

現在我想把電話轉給亞當。

Thanks, Melissa, and thank you all for joining us this morning. In the second fiscal quarter of 2023, we continue to navigate a challenging economic environment for commercial real estate. Despite this turbulent backdrop, we are pleased to report solid financial results highlighted by adjusted earnings per share of $0.49, adjusted EBITDA of $25.3 million and an annual dividend of $1.60 per share that remains secure and well covered. Collectively, these results are a reflection of our diverse client base and durable business model.

謝謝梅麗莎，也謝謝大家今天早上加入我們。 2023 年第二財季，我們將持續因應商業不動產充滿挑戰的經濟環境。儘管面臨這種動盪的背景，我們很高興地報告穩健的財務業績，其中調整後每股收益為0.49 美元，調整後EBITDA 為2530 萬美元，年度股息為每股1.60 美元，股息仍然安全且覆蓋良好。總的來說，這些結果反映了我們多元化的客戶群和持久的商業模式。

As it relates to operating fundamentals across our platform, we are proud of the tireless efforts of our employees to drive continued value at our managed assets with RMR ranging almost 2 million square feet of leasing on behalf of our clients at a weighted average lease term of over 9 years during the quarter. This leasing velocity across our managed portfolio resulted in a quarter end consolidated occupancy rate of almost 96%.

由於它與我們整個平台的營運基本面相關，我們為員工的不懈努力感到自豪，他們為推動我們管理的資產的持續價值而努力，RMR 代表我們的客戶租賃了近200 萬平方英尺，加權平均租賃期限為本季已超過 9 年。我們管理的投資組合的租賃速度使得季度末綜合入住率接近 96%。

Calendar year 2023 so far has been marked by 3 milestone events among RMR's client companies, all of which look to address the unique opportunities and challenges certain of our clients face as we look to position them for long-term sustainable success. First, in February, TA announced that it entered into a definitive agreement to be acquired by BP for $1.3 billion. TA has been on a transformational journey over the last 3 years, and we are pleased with the 84% premium this transaction represents for TA shareholders. There is a special meeting of TA shareholders scheduled for May 10 to approve the transaction. And earlier this week, TA announced that both ISS and Glass Lewis came out in support of the transaction. Assuming TA gets the requisite shareholder approval, the sale is expected to close on May 15.

迄今為止，RMR 的客戶公司在 2023 年發生了 3 個里程碑事件，所有這些事件都旨在解決我們的某些客戶在幫助他們取得長期可持續成功時所面臨的獨特機會和挑戰。首先，2月份，TA宣布簽訂最終協議，將由BP以13億美元收購。過去 3 年，TA 一直走在轉型之路上，我們對此交易為 TA 股東帶來 84% 的溢價感到滿意。 TA 股東定於 5 月 10 日召開特別會議以批准該交易。本週早些時候，TA 宣布 ISS 和 Glass Lewis 都站出來支持這項交易。假設 TA 獲得必要的股東批准，此次出售預計將於 5 月 15 日完成。

Second, in March, AlerisLife announced that ABP Trust successfully completed a tender offer and an 85% premium to the prior 30-day average trading price. We believe that AlerisLife, now a private company, will be able to enhance its focus on operational excellence and best position the company to successfully deliver on its business plan.

其次，3月份，AlerisLife宣布ABP Trust成功完成要約收購，且較先前30天平均交易價格溢價85%。我們相信，現在是一家私人公司的 AlerisLife 將能夠更加重視卓越運營，並為公司提供最佳定位，以成功實現其業務計劃。

Lastly, in April, 2 of our perpetual capital clients DHC and OPI announced an agreement to merge and change the combined company's name to Diversified Properties Trust. The merger will create a diversified REIT with a broad portfolio, defensive tenant base and strong growth potential. Financially, the merger is expected to be accretive to both entities' leverage and cash flow. The combined entity is expected to provide a sustainable annual dividend of $1 per share with the potential for dividend growth in the future.

最後，四月，我們的兩家永久資本客戶 DHC 和 OPI 宣布達成協議，合併並將合併後的公司更名為 Diversified Properties Trust。此次合併將創造一個多元化的房地產投資信託基金，擁有廣泛的投資組合、防禦性的租戶基礎和強勁的成長潛力。從財務角度來看，此次合併預計將增加兩家實體的槓桿率和現金流。合併後的實體預計將提供每股 1 美元的可持續年度股息，並且未來股息成長的潛力。

As it relates to DHC, it is facing a number of serious near-term challenges, driven largely by debt covenant restrictions that prevent it from issuing or refinancing debt. This problem is exacerbated by DHC having $700 million of debt coming due in early 2024, and DHC does not expect to be debt covenant compliance before this debt comes due. As a result, 1 of the biggest benefits of this merger for DHC is that upon its completion, the combined company will be in debt covenant compliance and can access regular way refinancing of its debt maturities.

就 DHC 而言，它面臨著許多嚴重的近期挑戰，這主要是由於債務契約限制阻止其發行或再融資債務。由於 DHC 的 7 億美元債務將於 2024 年初到期，而且 DHC 預計在該債務到期之前不會遵守債務契約，因此這一問題更加嚴重。因此，此次合併對 DHC 來說最大的好處之一是，合併完成後，合併後的公司將遵守債務契約，並可以對其債務到期日進行定期再融資。

In addition, while the SHOP recovery is underway and trending favorably, it is not happening fast enough and further capital is needed. In addition to debt refinancing capital to fund investments in DHC's portfolio to help drive the ongoing turnaround in the senior living properties.

此外，雖然商店復甦正在進行中且趨勢良好，但進展速度不夠快，需要更多資金。除了債務再融資之外，還為 DHC 投資組合提供資金，以幫助推動高級住宅物業的持續扭虧為盈。

Finally, DHC also benefits from the merger with OPI by immediately providing a significant increase in its dividend for shareholders. After the merger, DHC does not anticipate reinstating its regular dividend until 2025.

最後，DHC 還受益於與 OPI 的合併，立即為股東提供大幅增加的股息。合併後，DHC 預計要到 2025 年才會恢復定期股息。

As it relates to OPI, they are facing a number of current and longer-term challenges as office sector headwinds are likely to negatively affect office owners for the foreseeable future. More specifically, the financing environment for office properties is and expect it to remain very difficult for the foreseeable future. One of the biggest benefits of the merger for OPI is that it provides it with greater access to capital sources, including low-cost government and agency debt. OPI's office portfolio will also require increased capital investments in the coming years, and OPI was facing an unsustainable dividend rate prior to the merger announcement. By merging with DHC, OPI gains access to an attractive unencumbered portfolio of medical office buildings and life science properties, and we expect OPI will benefit long term from the expected eventual recovery in DHC's SHOP portfolio.

就 OPI 而言，他們面臨許多當前和長期的挑戰，因為辦公行業的逆風可能在可預見的未來對辦公室業主產生負面影響。更具體地說，辦公物業的融資環境在可預見的未來仍然非常困難。合併對 OPI 的最大好處之一是，它為其提供了更多獲得資本來源的機會，包括低成本的政府和機構債務。 OPI 的辦公大樓投資組合在未來幾年還需要增加資本投資，而 OPI 在宣布合併之前面臨不可持續的股息率。透過與 DHC 合併，OPI 可以獲得有吸引力的、不受阻礙的醫療辦公大樓和生命科學房地產投資組合，我們預計 OPI 將長期受益於 DHC SHOP 投資組合的預期最終復甦。

Turning to other highlights of notes across our clients. During the quarter, SVC further enhanced its financial profile by redeeming its June 2023 senior notes using the proceeds from a $610 million issuance of net lease mortgage notes. In light of the challenging capital markets environment, we are pleased with this financing and believe it's attributable to the strength and positive outlook of SVC's retail portfolio. SVC is also expected to benefit from BP's acquisition of TA as SVC will receive approximately $379 million in cash from the transaction. SVC also strengthens its tenant credit characteristics because the amended travel center leases will be guaranteed by BP's A- credit ratings. SVC's hotel portfolio also continues to experience positive operating fundamentals with robust increases in occupancy, ADR and RevPAR. With all facets of SVC's business improving, we believe SVC is possibly on a path to generate incentive fees to RMR in the future.

轉向我們客戶筆記的其他亮點。本季度，SVC 透過使用發行 6.1 億美元淨租賃抵押票據的收益贖回 2023 年 6 月的優先票據，進一步改善了其財務狀況。鑑於資本市場環境充滿挑戰，我們對此融資感到滿意，並相信這歸功於 SVC 零售投資組合的實力和積極前景。 SVC 預計也將受益於 BP 收購 TA，因為 SVC 將從此次交易中獲得約 3.79 億美元的現金。 SVC 還加強了其租戶信用特徵，因為修訂後的旅遊中心租賃將由 BP 的 A- 信用評級提供擔保。 SVC 的飯店組合也持續呈現正面的營運基本面，入住率、平均房價和每間客房收入均強勁成長。隨著 SVC 業務各方面的改善，我們相信 SVC 未來可能會向 RMR 產生激勵費用。

At Seven Hills Realty Trust, our publicly traded mortgage REIT we believe there remains significant opportunities to grow this part of our business. Seven Hills' portfolio remains default free, a testament to our disciplined underwriting and asset management capabilities. In addition, with the recent pullback by many regional banks, Seven Hills has seen its pipeline well over $1 billion in possible transaction, whether it be at Seven Hills or a new private capital vehicle. We believe our successful lending platform leaves us well positioned to possibly grow this type of AUM for RMR in the future.

在七山房地產信託公司（我們的公開交易抵押貸款房地產投資信託基金），我們相信仍然存在巨大的機會來發展我們的這部分業務。七座山的投資組合仍然沒有違約，證明了我們嚴謹的承保和資產管理能力。此外，隨著許多地區銀行最近的撤資，七座山的潛在交易額已遠遠超過 10 億美元，無論是在七山還是新的私人資本工具。我們相信，我們成功的貸款平台使我們處於有利地位，並有可能在未來增加 RMR 的此類資產管理規模。

With almost $200 million in cash and no debt, we believe our durable business model affords us the benefit of patients to take advantage of strategic opportunities that we believe will result from the ongoing market volatility.

憑藉近 2 億美元的現金且沒有債務，我們相信我們持久的業務模式可以使患者受益，從而利用我們認為持續的市場波動帶來的策略機會。

I'll now turn the call over to Matt Jordan, our Chief Financial Officer.

我現在將把電話轉給我們的財務長馬特喬丹。

Thanks, Adam, and good morning, everyone. For the second quarter, we reported adjusted net income of $8.1 million or $0.49 per share and adjusted EBITDA of $25.3 million, with both measures being in line with our quarterly guidance. This quarter's adjusted EBITDA margin of 50% yet again highlights the highly efficient and scalable platform RMR has in place.

謝謝亞當，大家早安。第二季度，我們公佈的調整後淨利潤為 810 萬美元，即每股 0.49 美元，調整後 EBITDA 為 2,530 萬美元，這兩項指標均符合我們的季度指引。本季調整後的 EBITDA 利潤率為 50%，再次凸顯了 RMR 所擁有的高效且可擴展的平台。

Total management and advisory service revenues were $48.2 million, which was down $1.4 million sequentially. This decrease was primarily attributable to seasonal declines at TA and Sonesta as well as a decrease in construction management fees as large redevelopment projects at OPI and DHC wound down.

管理和諮詢服務總收入為 4,820 萬美元，比上一季減少 140 萬美元。這一下降主要歸因於 TA 和 Sonesta 的季節性下降，以及 OPI 和 DHC 大型再開發項目結束而導致的建築管理費下降。

In regards to the financial impact to RMR from the TA transaction, TA currently represents approximately $4 million in quarterly revenues. The loss of this revenue will be offset over time by a number of factors, which includes the favorable impact to our management fees from the increase to SEC share price subsequent to the TA transaction announcement, as well as approximately $1 million in annual compensation savings and the resulting interest income from the $100 million in cash RMR will receive in connection with the TA transaction.

至於 TA 交易對 RMR 的財務影響，TA 目前的季度營收約為 400 萬美元。隨著時間的推移，這一收入的損失將被多種因素所抵消，其中包括 TA 交易公告後 SEC 股價上漲對我們管理費的有利影響，以及每年約 100 萬美元的薪酬節省和與TA 交易相關的1 億美元現金RMR 將收到由此產生的利息收入。

As it relates to next quarter, based upon the current average enterprise values of our managed equity REITs, projected construction volumes and an expected closing date of May 15 for the TA transaction, we expect to generate between $45 million and $47 million of management and advisory service revenues next quarter. This guidance excludes approximately $45 million in termination fees that we expect to receive upon completion of the TA transaction.

就下季度而言，根據我們管理的股權 REIT 的當前平均企業價值、預計建設量以及 TA 交易的預計截止日期 5 月 15 日，我們預計將產生 4500 萬至 4700 萬美元的管理和諮詢費用下季度的服務收入。本指引不包括我們預計在 TA 交易完成後收到的約 4,500 萬美元的終止費用。

Turning to expenses. Recurring cash compensation was approximately $34.5 million, an increase of $1.3 million sequentially and due primarily to payroll tax and 401(k) contributions resetting on January 1. This quarter, we recovered approximately 43% of our cash compensation from our clients.

轉向開支。經常性現金薪酬約為3,450 萬美元，比上一季增加了130 萬美元，這主要是由於1 月1 日工資稅和401(k) 繳款重置所致。本季度，我們從客戶那裡收回了約43% 的現金薪資。

Looking ahead to next quarter, we expect recurring cash compensation to be approximately $34 million with a projected reimbursement rate closer to 44%. G&A expense of $9.5 million this quarter includes approximately $500,000 of costs related to annual Board of Directors share grants and approximately $600,000 or $0.01 per share of technology transformation costs. On a normalized basis, G&A should be approximately $9 million next quarter, excluding technology investments. We closed the quarter with almost $200 million in cash. In connection with the TA transaction, we expect to receive approximately $100 million from the sale of the TA shares RMR owns and the termination fee I touched on earlier. As such, we expect to end next quarter with approximately $300 million in cash.

展望下個季度，我們預計經常性現金補償約為 3,400 萬美元，預計報銷率將接近 44%。本季的一般管理費用為 950 萬美元，包括約 50 萬美元與年度董事會股份授予相關的成本以及約 60 萬美元或每股 0.01 美元的技術轉型成本。正常情況下，下個季度的一般管理費用約為 900 萬美元，不包括技術投資。本季結束時，我們擁有近 2 億美元的現金。關於 TA 交易，我們預計將透過出售 RMR 擁有的 TA 股份以及我之前提到的終止費用獲得約 1 億美元。因此，我們預計下個季度末將擁有約 3 億美元的現金。

Aggregating all the prospective assumptions I outlined earlier, next quarter, we expect adjusted earnings per share to range from $0.46 to $0.48 per share and adjusted EBITDA should range from $23 million to $25 million.

綜合我之前概述的所有預期假設，下個季度我們預計調整後每股收益將在 0.46 美元至 0.48 美元之間，調整後 EBITDA 將在 2300 萬美元至 2500 萬美元之間。

Before we begin the question-and-answer portion of the call, I would like to first acknowledge the publication of our annual sustainability report. The report highlights the many accomplishments and programs that drive our organization each and every day. As we've highlighted previously, RMR is publicly committed to reducing greenhouse gas emissions at assets we have operational control over by 50% by 2030 and to attain net 0 emissions by 2050. Through calendar 2022, we've already achieved almost a 35% reduction in greenhouse gas emissions through energy efficiency measures, sustainable habits and renewable energy programs. We encourage those listening to go to the Sustainability section of RMR's website, where you can see a collective overview of our environmental programs contributions to the communities we operate in and the investments we make in our people.

在我們開始電話問答部分之前，我想先感謝我們年度永續發展報告的發布。該報告重點介紹了每天推動我們組織發展的眾多成就和計劃。正如我們先前強調的，RMR 公開承諾到 2030 年將我們營運控制的資產的溫室氣體排放量減少 50%，並在 2050 年實現淨零排放。到 2022 年，我們已經實現了近 35%通過能源效率措施、永續習慣和再生能源計畫減少溫室氣體排放。我們鼓勵聽眾造訪 RMR 網站的可持續發展部分，在這裡您可以看到我們的環境計畫對我們所在社區的貢獻以及我們對員工的投資的總體概述。

Secondly, as Melissa highlighted earlier, we cannot address questions regarding either the planned merger between OPI and DHC or the planned acquisition of TA by BP.

其次，正如 Melissa 之前所強調的那樣，我們無法解決有關 OPI 和 DHC 計劃合併或 BP 計劃收購 TA 的問題。

Operator, would you please open the line to questions?

接線員，請打開線路提問好嗎？

(Operator Instructions) Our first question will come from Bryan Maher of B. Riley Securities.

（操作員指示）我們的第一個問題將來自 B. Riley Securities 的 Bryan Maher。

Adam and Matt, I guess it's going to be a short Q&A session today for you with -- I'm talking about the deals. But kind of related to that, we noticed our G&A numbers were a little light relative to what you reported in the second fiscal quarter. Is any of that really being driven by legal or advisory fees? Or is that being accounted for elsewhere?

亞當和馬特，我想今天對你們來說將是一個簡短的問答環節——我正在談論交易。但與此相關的是，我們注意到我們的一般行政費用數據相對於您在第二財季報告的數據來說有點少。其中任何一個真的是由法律或諮詢費用驅動的嗎？還是其他地方已經考慮到了這一點？

No. G&A, when you back out the 2 large items this quarter, our run rate this quarter is actually $8.4 million. So we feel pretty good actually where G&A landed, but you got to exclude the director share grants and the other $0.5 million or so of technology transformation costs, which we back out of adjusted EBITDA.

不。G&A，當您收回本季度的 2 個大項目時，我們本季的運行率實際上是 840 萬美元。因此，我們實際上對 G&A 的落地感覺相當不錯，但你必須排除董事股份贈款和其他 50 萬美元左右的技術轉型成本，這些成本我們從調整後的 EBITDA 中扣除。

Yes. I got to believe you've had some pretty high legal and advisory costs. Where would those be going? Are they going into the actual managed REITs and OpCos?

是的。我相信你已經承擔了相當高的法律和諮詢費用。那些會去哪裡？他們是否會進入實際管理的房地產投資信託基金和營運公司？

Correct. The REITs would be absorbing those costs, not RMR.

正確的。 REITs 將吸收這些成本，而不是 RMR。

Got it. And then we hear what you're saying as it relates to office challenges on financing and DHC's incurrence test. But can you give us any color on the appetite of some of the sovereign wealth funds that you've dealt with in the past as to stepping up to the play should any of the managed REITs need further JV asset sales into those JVs or other type of capital where your deep-pocketed relationships could step up and help over the next 6 to 12 months if needed?

知道了。然後我們會聽到您所說的，因為它涉及融資方面的辦公室挑戰和 DHC 的發生測試。但是，您能否告訴我們您過去處理過的一些主權財富基金的興趣，如果任何管理的房地產投資信託基金需要進一步向這些合資企業或其他類型的合資企業出售資產，它們是否會介入？如果需要的話，您財力雄厚的關係可以在未來6 到12 個月內加強並提供幫助嗎？

Sure, Bryan. Yes, I think the relationships we currently have are very much open for business. As we've stated before, we have some good -- very good relationships with some very large Asian sovereign wealth funds. I would say that the issue is that while they're very much open for business, their returns expectations have increased. And so therefore, pricing around assets that we could be put into a JV may not be very attractive for us. I think we could explore it. But based on our understanding and preliminary conversations with them about what they are doing and how they are looking at investments. I'm not sure it would be a very attractive alternative for our companies today.

當然，布萊恩。是的，我認為我們目前的關係非常開放。正如我們之前所說，我們與一些非常大的亞洲主權財富基金有著良好的、非常好的關係。我想說的問題是，雖然他們對業務非常開放，但他們的回報預期卻增加了。因此，圍繞我們可以放入合資企業的資產進行定價對我們來說可能不太有吸引力。我想我們可以探索一下。但基於我們的理解以及與他們關於他們正在做什麼以及如何看待投資的初步對話。我不確定這對我們今天的公司來說是否是一個非常有吸引力的選擇。

So it's not something I anticipate we see a lot of going forward. You also have to keep in mind that some of the assets that would be most attractive and available to go into those JVs, good or bad, maybe some of the better assets that we have that are currently generating a lot of the cash flow that helps our companies specifically DHC or OPI or any of the REITs. And by removing that very healthy cash flow, yes, you get a near-term liquidity boost but you lose out on the cash flow going forward.

所以我預計我們不會在未來看到很多進展。您還必須記住，一些最有吸引力且可用於這些合資企業的資產，無論好壞，也許是我們擁有的一些更好的資產，目前正在產生大量現金流，有助於我們的公司，特別是DHC 或OPI 或任何REIT。是的，透過消除非常健康的現金流，你會得到短期的流動性增加，但你會失去未來的現金流。

So you're sort of -- you're solving a short-term problem, but you may be not solving a longer-term problem because you still -- you got to replace that cash flow. And that becomes exacerbated if the pricing for the asset into the JV or sale regardless isn't high. And today, the environment we're in, it's available, you can sell assets and the sovereign wealth funds we're dealing with are open for business, but I don't think the pricing would be particularly attractive or really work to solve a lot of our products.

所以你有點——你正在解決一個短期問題，但你可能沒有解決一個長期問題，因為你仍然——你必須更換現金流。如果合資企業或出售資產的定價不高，這種情況就會加劇。今天，我們所處的環境是可用的，你可以出售資產，我們正在處理的主權財富基金也可以營業，但我認為定價不會特別有吸引力，也不會真正解決問題。我們的許多產品。

Now in a pinch, if we really got against the wall, and we didn't want to absolutely go into complete default on our debt. I suppose we could do it for a short term to pay off the debt maturity itself, but it won't solve the covenant issue because we will lose cash flow.

現在緊要關頭，如果我們真的陷入困境，我們絕對不想完全違約。我想我們可以短期內這樣做來償還債務到期本身，但這不會解決契約問題，因為我們將損失現金流。

Right. Now would that be aside from, let's say, ILPT where you had wanted to put another 40% slug into the JV, I guess it was the Mountain JV and sell the sale of 30 assets. Aside from what you just talked about with respect to JVs and asset sales there, is the game plan still to move forward with deconsolidating those 90, 95 properties out of ILPT and giving that stock kind of new legs for life here?

正確的。現在，除了 ILPT 之外，您還想將另外 40% 的股份投入合資企業，我猜是 Mountain 合資企業並出售了 30 項資產。除了您剛才談到的有關合資企業和資產出售的內容之外，遊戲計劃是否仍會繼續推進，將這 90、95 處房產從 ILPT 中剝離出來，並為該股票提供新的生命力？

That would definitely be the plan. Unfortunately, as ILPT discloses is in its financial package, and I think as they talked about on their call, that joint venture does not currently cash flow because the -- of rapid rise in interest rates and the floating rate debt that we put in place to finance the mountain JV. So while we do not anticipate there being a need for capital calls into the joint venture, it is not throwing off a significant -- it's not throwing off any cash flow. And therefore, for a core or core plus investment, which most investors when they invest in a core or core plus portfolio, it's not a particularly high return, but they're looking for stability.

這肯定是計劃。不幸的是，正如 ILPT 在其財務方案中所披露的那樣，我認為正如他們在電話會議上談到的那樣，該合資企業目前沒有現金流，因為利率快速上升以及我們設立的浮動利率債務為山區合資企業提供資金。因此，雖然我們預計合資企業不需要注資，但這並不會造成重大損失——也不會造成任何現金流。因此，對於核心或核心+投資來說，大多數投資者在投資核心或核心+投資組合時，並不是特別高的回報，但他們正在尋求穩定性。

Part of that stability is a current income. We are not in a position that we can offer a current income in that portfolio. So we do not believe it would be attractive to any potential -- other additional joint venture partner. So yes, we'd love to sell an interest in that to somebody and deconsolidate it. We don't believe, and I think ILPT addressed this on their call as well as it's -- we try to highlight in some of the materials that ILPT puts out in its supplemental. It's not practical to believe that's going to happen.

這種穩定性的一部分是當前的收入。我們無法在該投資組合中提供當前收入。因此，我們認為它不會對任何潛在的其他合資夥伴有吸引力。所以，是的，我們很樂意將其權益出售給某人並對其進行拆分。我們不相信，而且我認為 ILPT 在他們的電話會議上解決了這個問題——我們試圖在 ILPT 在其補充資料中提供的一些資料中強調這一點。相信這會發生是不切實際的。

Right. But with the industrial REITs that we track, it seems like everybody is having a lot of success with driving renewal rates pretty impressively higher still in the 20% ZIP code. So it seems like it's only maybe a matter of time that organically ILPT should be able to raise NOI to kind of get you out of that scenario, especially if one were to believe the 10-year rates where they're trading currently if interest rates were to kind of backtrack 12 to 18 months from now. It seems like there is a clear sign of light out of the situation. It's just going to take time. Is that correct?

正確的。但在我們追蹤的工業房地產投資信託基金中，似乎每個人都取得了巨大的成功，在 20% 的郵遞區號地區，續約率仍然令人印象深刻地提高。因此，ILPT 有機地提高 NOI 以使您擺脫這種情況似乎只是時間問題，特別是如果人們相信他們目前交易的 10 年期利率，如果利率從現在起 12 到 18 個月後會出現回溯。局勢似乎有了明顯的曙光。這只是需要時間。那是對的嗎？

There is. It's a question of time. We're blessed with the fact that we have a very high -- very well occupied, very high credit quality tenant base, roughly 99% leased to very -- majority investment-grade rated tenants, well located properties, newer properties. The average lease term is 9 years. So the issue is that we don't -- and every lease that does come up for renewal, we are rolling up, and we're rolling them up significantly. The problem is we don't -- if there's a problem, it's just -- there's just not a lot that's renewing every year.

有。這是時間問題。我們很幸運，我們擁有非常高的租用率、非常高的信用品質租戶基礎，大約 99% 的租戶出租給了大多數投資級租戶、位置優越的房產、較新的房產。平均租賃期限為9年。所以問題是我們不這樣做——每一個需要續約的租約，我們都在滾動，而且我們正在大幅滾動。問題是我們不這樣做——如果有問題，那隻是——每年更新的東西並不多。

And so we're sort of blessed and cursed with that portfolio because we just don't have enough leases rolling. I agree with your conclusion and what you're saying, Bryan, that eventually, it will grow out of it. But we're talking unfortunately years not months or quarters for it to grow out of it because it's going to take that much time for the leases to roll -- enough leases to roll to create enough increase in NOI to really move the needle.

因此，我們對這個投資組合感到幸運又詛咒，因為我們沒有足夠的滾動租賃。我同意你的結論和你所說的，布萊恩，最終，它會從中成長。但不幸的是，我們談論的是幾年而不是幾個月或幾個季度才能擺脫困境，因為租賃需要很長時間才能滾動——足夠的租賃滾動才能創造足夠的 NOI 增長，從而真正推動發展。

Got it. Just last for me. I don't think I've seen anywhere and maybe you're yet to disclose it. But when OPI and DHC do merge, have you identified what the new benchmark index would be for that combined entity?

知道了。只為我最後一次。我想我沒見過任何地方，也許你還沒透露。但是，當 OPI 和 DHC 合併時，您是否確定了合併後實體的新基準指數是什麼？

We have not. It's an interesting nuance question, and we have discussed it preliminarily at the Board level. I will tell you that on a combined basis, the majority of the assets would be office, office, including medical office and life science. That all being said, I think that's something that the board of the combined company will likely take up after the completion of the merger, we'll consider that more seriously.

我們還沒有。這是一個有趣的細微差別問題，我們已經在董事會層級進行了初步討論。我會告訴你，在合併的基礎上，大部分資產將是辦公室，辦公室，包括醫療辦公室和生命科學辦公室。話雖如此，我認為合併完成後合併後公司的董事會可能會考慮這個問題，我們會更認真地考慮這一點。

(Operator Instructions) And our next question will come from Ronald Kamden of Morgan Stanley.

（操作員說明）我們的下一個問題將來自摩根士丹利的羅納德·卡姆登。

This is Tim on Ronald Kamden. Yes, maybe just following up on the previous question. You guys talked about higher return hurdles in the private markets. Just understand asset sales and whatnot may not help the covenants. But just in terms of expectations for pricing relative to maybe where the stocks trade on a public market, could you guys comment on that at all?

這是羅納德·卡姆登的提姆。是的，也許只是跟進上一個問題。你們談到了私募市場的更高回報障礙。僅僅了解資產出售之類的東西可能對契約沒有幫助。但就相對於股票在公開市場上交易的定價的預期而言，你們能對此發表評論嗎？

So based on implied cap rates that the stocks are currently trading at, they do seem quite a bit wider than where even at the higher cap rate environment we're living on a private -- in the private market. I'm not talking about the merger itself, but 1 of the things that we've certainly been quite negatively affected by between the OPI DHC merger is the drop in the stocks at OPI and DHC, that's had a direct impact on RMR's cash flow and perhaps a significant direct negative impact. And so I do believe they're trading quite a bit wide of where you would see private valuations be for some of those assets. The issue is in the private markets is it's very hard to determine value, especially around the office because there's very little trading activity going on in the marketplace. Generally speaking, anything that has the word office today feels like whether it is good office or bad office or well located in newer buildings or older buildings is just negatively viewed across the board.

因此，根據股票目前交易的隱含資本化率，它們似乎確實比我們生活在私人市場上的更高資本化率環境下要廣泛得多。我不是說合併本身，而是 OPI 與 DHC 合併之間我們肯定受到相當負面影響的一件事是 OPI 和 DHC 的股票下跌，這對 RMR 的現金流產生了直接影響也許還會產生重大的直接負面影響。因此，我確實相信，他們的交易範圍遠高於你所看到的其中一些資產的私人估值。問題在於私人市場，很難確定價值，尤其是在辦公室周圍，因為市場上進行的交易活動很少。一般來說，今天任何帶有“辦公室”一詞的東西，無論它是好辦公室還是壞辦公室，或者位於新建築還是舊建築中，都給人一種全面負面的看法。

And so everything gets thrown out with it. I believe, and I hope this to be true over the coming quarters or years that what's happened -- what happened, I think, an analogy in the retail sector over the last decade will start to happen in the office sector where you -- investors, lenders, finance providers, we'll start bifurcating between good office assets and bad office assets. And I think the good office assets, which frankly, we have a portfolio that is majority A class buildings and were happen to have a portfolio that's not heavily located in gateway markets, which used to be where everybody wanted to be, and I'm not sure that's the right place to have a large portfolio today in office in gateway markets.

所以一切都被拋棄了。我相信，並且我希望在未來的幾個季度或幾年裡，所發生的事情——我認為，過去十年零售業中發生的事情將開始發生在辦公室行業，您——投資者、貸方、金融提供者，我們將開始區分良好的辦公室資產和不良的辦公資產。我認為良好的辦公資產，坦白說，我們的投資組合大部分是 A 級建築，而且碰巧有一個投資組合並不位於門戶市場，而門戶市場曾經是每個人都想進入的地方，我現在不確定今天在門戶市場的辦公室是否適合擁有大量投資組合。

I think you're may be better served having a diverse portfolio and Class A office buildings in suburban markets across the country, especially in the Southeast and Southwest, which we have a large portion of properties.

我認為，在全國郊區市場擁有多元化的投資組合和甲級辦公大樓可能會更好，特別是在東南部和西南部，我們在這兩個地區擁有大量房產。

So it's a long way of answering your question that yes, I think our stocks are not reflecting sort of intrinsic value. But I think a lot of stocks today are not reflective of intrinsic value because there's not a lot of transactions that people can point to, to come up with real value and even in the private marketplace.

因此，回答你的問題還有很長的路要走，是的，我認為我們的股票沒有反映某種內在價值。但我認為今天的許多股票並不能反映內在價值，因為人們可以指出的交易並不多，無法得出真正的價值，甚至在私人市場也是如此。

Great. That makes sense. And then, obviously, without getting into detail about the RMR or the OPI and DHC transaction. Just in terms of access to DHC financing, I understand I was 1 of the impetus for the transaction in general are 1 of it. Just in terms of some of the underwriting standards and whatnot that will be looked at just because from my understanding, the SHOP portfolio is fully stabilized, will that be looked at kind of on a pro forma basis or just on trailing results? How are you thinking about that?

偉大的。這就說得通了。然後，顯然，沒有詳細介紹 RMR 或 OPI 和 DHC 交易。就獲得DHC融資而言，我理解我是1，交易的推動力一般都是1。就一些承保標準以及諸如此類的問題而言，根據我的理解，SHOP 投資組合已完全穩定，是會在預計的基礎上進行考察，還是僅根據跟踪結果進行考察？你覺得怎麼樣？

So just to make sure I understand the question, how does -- in the SHOP portfolio, how does, let's say, the agencies look at financing those assets?

因此，為了確保我理解這個問題，在 SHOP 投資組合中，各機構如何看待這些資產的融資？

Yes, exactly.

對，就是這樣。

Yes. So they revised their financing criteria over the last few years. And the good news is we have a large portfolio of senior living assets. And although they are struggling but improving, obviously, with over 200 roughly 30 assets, roughly senior living assets, we obviously have many assets that are performing fine. Unfortunately, we get more assets not performing fine. So you don't have to take the entire portfolio. You can take a group of assets based on historical and the agencies have become a little bit more forgiving in the way they do the underwriting, where they may -- they will just look at maybe the most recent quarter and then annualize that, keeping in mind your projections, they won't take the last 12 months.

是的。因此，他們在過去幾年中修改了融資標準。好消息是我們擁有大量的老年生活資產組合。儘管他們正在掙扎，但顯然正在改善，我們擁有 200 多個大約 30 項資產，大約是高級生活資產，我們顯然有許多資產表現良好。不幸的是，我們得到了更多表現不佳的資產。所以你不必拿走整個作品集。你可以根據歷史數據來獲取一組資產，機構在承銷方面變得更加寬容，他們可能會只關注最近一個季度的資產，然後將其年化，保持在請注意您的預測，它們不會花費過去12 個月的時間。

And so there's an opportunity, and the agencies have been doing this largely because they -- this is largely something that came out of the pandemic because they recognized that in the recovery for a lot of senior living assets. If you look back 12 months, you were going to have a pretty low underwriting -- ability to underwrite. Now they're more willing to look at just 1 quarter back, which might -- obviously, if things have been improving over many quarters, the most recent quarter, hopefully, is the best quarter and then you annualize that, and that's what you use for the underwriting. We're optimistic that there is a portfolio of assets within the DHC portfolio that will provide for significant capital or financing to be able to be put on those assets that we are not able to access today at DHC.

所以這是一個機會，這些機構之所以這樣做，很大程度上是因為他們——這很大程度上是大流行帶來的結果，因為他們在許多老年生活資產的復甦中認識到了這一點。如果你回顧 12 個月，你會發現承保能力相當低。現在他們更願意只看一個季度的數據，顯然，如果許多季度情況都在改善，那麼最近一個季度，希望是最好的季度，然後你將其年化，這就是你的結果用於承保。我們樂觀地認為，DHC 投資組合中的資產組合將為我們目前在 DHC 無法獲得的那些資產提供大量資本或融資。

And that, again, I said in my prepared remarks, I'm just repeating it, is 1 of the benefits of the transaction is on a combined basis, you're in debt covenant compliance. That's a huge thing that I think a lot of investors sort of brush aside about the covenants. It's very onerous. We're not allowed to finance new debt. We're not allowed to finance, refinance expiring debt, you just can't issue any debt. And by being in compliance, we can then access that what I think very, very liquid, open and cost-competitive financing. And if you're -- especially if you're in the office sector, if you have access to that funding window, I think you are at a competitive advantage in the marketplace.

我在準備好的發言中再次說過，我只是重複一遍，交易的好處之一是在綜合基礎上，你遵守債務契約。這是一件大事，我認為很多投資人都對這些契約置之不理。這是非常繁重的。我們不允許為新債務融資。我們不允許為到期債務提供融資、再融資，你只是不能發行任何債務。透過遵守規定，我們可以獲得我認為非常非常流動、開放且具有成本競爭力的融資。如果你——特別是如果你在辦公領域，如果你有機會獲得融資窗口，我認為你在市場上處於競爭優勢。

Great. And maybe just a follow-up. If the underwriting is based on quarterly results I guess, the logical thing to do would be to wait until maybe the second half in '24 before you actually access the DHC financing, just to show kind of stabilized results. Is that kind of the right way to think about it? Or?

偉大的。也許只是後續行動。如果承銷是基於季度業績，我想，合乎邏輯的做法是等到 24 年下半年，然後再真正獲得 DHC 融資，只是為了顯示某種穩定的結果。這是正確的思考方式嗎？或者？

I think we have to wait. Yes, this is getting a little ahead of ourselves is planning a little bit too far out. I think we are -- we could be in a position to put financing in place if we chose to in early '24. We could be in a position to do so. The question you're asking is, would you do so? And the answer is I don't know, but I do know that we could, by early '24, in my belief, do so and do so in a sizable way if we had to. So it's there for us, whether we choose to do, it's a different question that you're asking, but we can.

我想我們必須等待。是的，這有點超前了，計劃有點太遠了。我認為，如果我們選擇在 24 年初進行融資，我們就能夠到位。我們可以這樣做。你問的問題是，你會這樣做嗎？答案是我不知道，但我確實知道，到 24 年初，我相信我們可以這樣做，而且如果有必要的話，我們可以以相當大的方式這樣做。所以它就在那裡，無論我們選擇做什麼，這與你問的問題不同，但我們可以。

The next question is a follow-up from Bryan Maher of B. Riley Securities.

下一個問題是 B. Riley Securities 的 Bryan Maher 的後續問題。

Great. So Adam, you opened up that door for me on the SHOP financing question, which I think we understand here pretty well. When we look at roughly $4 billion in unencumbered SHOP assets within DHC, we were thinking something along the lines of maybe you cherry pick out $1.4 billion, $1.5 billion of the better-performing NOI accelerated from renovations last year properties to do a tranche in early 2024 to take out the 2024 debt for OPI and DHC. And then maybe you do another 1 a year later after other SHOP NOI assets have moved northward and can support that debt. Is that unrealistic to be thinking in that way?

偉大的。亞當，你為我打開了關於商店融資問題的大門，我認為我們對此非常了解。當我們查看DHC 內約40 億美元的未支配SHOP 資產時，我們在想，也許你會精挑細選14 億美元，其中15 億美元表現較好的NOI 從去年的房產翻修中加速，以便在年初進行一部分2024 年償還 OPI 和 DHC 2024 年債務。然後，也許您可以在一年後，在其他 SHOP NOI 資產向北移動並可以支持該債務後，再做一次。這樣想是不切實際嗎？

You're actually in the right thinking about things correctly, Bryan. Those are all things we can do. I will just put some markers out there for you to be thinking about. Obviously, we want to be very careful in terms of if we access that market picking the most mature properties that we are financing them too early in their recovery. We want properties that are largely recovered, and we're not leaving some financing on the table. $1.4 billion, $1.5 billion in '24 sounds a little heavy to me, to be honest. But if we did something that large, I think we'd be taking some assets that were not fully recovered in leaving financing on the table.

布萊恩，你實際上正確地思考了事情。這些都是我們能做的。我只會放一些標記供您思考。顯然，我們在進入市場時要非常小心，選擇最成熟的房產，以免我們在復甦過程中過早為它們提供融資。我們希望財產大部分得到恢復，我們不會留下一些融資。老實說，24 年的 14 億美元、15 億美元對我來說聽起來有點沉重。但如果我們做了這麼大的事情，我認為我們會拿走一些尚未完全收回的資產，從而將融資擱置在桌面上。

The other benchmark to keep in mind is there are limits to how much secured debt we can ultimately put on the portfolio because remember, we do not want to -- because every time we put secured debt on, when we're moving those assets on the unencumbered asset pool. And we still have unsecured bonds that have unsecured debt covenants. And so yes, we have significant room to add secured financing well into -- well past the $1 billion, but there's a limit to how much we can put on. And so think about that. I'm not sure you could say something like $1.5 billion, and then there's another $1.5 billion. I think you can start really stressing covenants for the unencumbered bonds that will still be in place. So that's -- those are just some sort of reactions and markets for you to think about.

另一個要記住的基準是，我們最終可以在投資組合中投入多少擔保債務，因為記住，我們不想這樣做——因為每次我們投入擔保債務時，當我們將這些資產轉移到投資組合上時未支配資產池。我們仍有無擔保債務契約的無擔保債券。因此，是的，我們有很大的空間可以增加擔保融資——遠遠超過 10 億美元，但我們可以投入的金額是有限的。所以想一想。我不確定你是否可以說 15 億美元，然後還有另外 15 億美元。我認為你可以開始真正強調仍然存在的無負擔債券的契約。所以，這些只是供您思考的某種反應和市場。

Right. But I got to believe that if you just did in the first half of 2024, a pledge -- and when I say $1.5 billion, $1.4 billion pledge, $1.4 billion, $1.5 billion to take out $1 billion cash your other debt will trade more favorably and 1 would have to believe that the bank groups associated with OPI and DHC combined company would have a sigh of relief and be much more agreeable to just simply refinance debt that comes to on a go-forward basis after you've maybe tapped, I don't know, the first $0.5 billion or $1 billion of agency debt. Is that correct thinking?

正確的。但我必須相信，如果你在2024 年上半年做出承諾，當我說15 億美元、14 億美元承諾、14 億美元、15 億美元以取出10 億美元現金時，你的其他債務交易將會更有利1 必須相信，與 OPI 和 DHC 合併後的公司相關的銀行集團會鬆一口氣，並且更願意簡單地為您可能利用後的未來債務進行再融資，我不知道，第一筆5 億美元還是10 億美元的機構債務。這樣的想法正確嗎？

Bryan, that is correct, thinking. Yes, I think in the near term, we have a bias towards thinking about putting agency debt on sometime in '24. The timing is a little open. It's a little ways away. So we're not quite sure exactly when. But some time in '24, and that's right. Our hope is that we would then have more regular way access to the unsecured market going forward after that. That would be the sort of base business plan. But a lot -- that has a lot of assumptions in that base business plan that we have to see come true.

布萊恩，這是正確的，他想。是的，我認為在短期內，我們傾向於考慮在 24 年的某個時候償還機構債務。時間有點開放。有點遠了。所以我們不太確定具體時間。但在 24 年的某個時候，那是對的。我們希望在此之後我們能夠以更常規的方式進入無擔保市場。這就是基本的商業計劃。但在基本業務計劃中有很多假設，我們必須看到這些假設成為現實。

This concludes our question-and-answer session. I would like to turn the conference back over to Adam Portnoy, President and Chief Executive Officer, for any closing remarks.

我們的問答環節到此結束。我想將會議轉回總裁兼執行長 Adam Portnoy 發表閉幕詞。

Thank you all for joining us on today's call. We look forward to speaking with you again in the future.

感謝大家參加今天的電話會議。我們期待將來再次與您交談。

The conference has now concluded. Thank you for attending today's presentation, and you may now disconnect.

會議現已結束。感謝您參加今天的演示，您現在可以斷開連接了。