Q3 2025 Industrial Logistics Properties Trust Earnings Call
Speaker #3: A .
Speaker #4: Good morning and welcome to Industrial Logistics property logistics properties . Trust's third quarter 2020 financial results . Conference call . All participants will be in listen only mode .
Operator: Good morning and welcome to Industrial Logistics Properties Trust's third quarter 2025 financial results conference call. All participants will be in listen only mode. Should you need assistance, please signal a conference specialist by pressing Star then zero on your telephone keypad. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press Star then one on your telephone keypad. To withdraw your question, please press Star then two. Please note this event is being recorded. I would now like to turn the conference over to Kevin Berry, Senior Director of Investor Relations. Please go ahead.
Speaker #4: Should you need assistance , please signal a conference specialist by pressing star . Then zero on your telephone keypad . After today's presentation , there will be an opportunity to ask questions , to ask a question , you may press star , then one on your telephone keypad .
Speaker #4: To withdraw your question , please press star . Then two . Please note this event is being recorded . I would now like to turn the conference over to Kevin Barry , Senior Director of Investor Relations .
Speaker #4: Please go ahead .
Speaker #5: Good morning . Thank you for joining us today . With me on the call . Are President and chief Operating Officer Yael Duffy .
Kevin Berry: Good morning. Thank you for joining us today. With me on the call are ILPT's President and Chief Operating Officer Yael Duffy, Chief Financial Officer and Treasurer Tiffany Tsai, and Vice President Marc Krohn. In just a moment, they will provide details about our business and our performance for the third quarter of 2025, followed by a question and answer session with sell side analysts. Please 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 laws. These forward looking statements are based on ILPT's beliefs and expectations as of today, October 29, 2025, and actual results may differ materially from those that we project.
Speaker #5: Chief Financial Officer and Treasurer Tiffany Sy . And Vice president Marc Krohn . In just a moment , they will provide details about our business and our performance for the third quarter of 2025 , followed by a question and answer session with sell side analysts .
Speaker #5: Please 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 laws .
Speaker #5: These forward looking statements are based on beliefs and expectations as of today , October 29th , 2025 , 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 .
Kevin Berry: 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 accessed from our website. ILPTreit.com investors are cautioned not to place undue reliance upon any forward looking statements. In addition, we will be discussing non-GAAP financial measures during this call, including normalized funds from operations and normalized FFO, adjusted EBITDAre, net operating income or NOI, and cash basis NOI. A reconciliation of these non-GAAP measures to net income is available in our financial results package, which can be found on our website. I will now turn the call over to Yael.
Speaker #5: Additional information concerning factors that could cause those differences is contained in our filings with the Securities and Exchange Commission , which can be accessed from our website .
Speaker #5: I'll . Street.com . Investors are cautioned not to place undue reliance upon any forward looking statements . In addition , we will be discussing non-GAAP financial measures during this call , including normalized funds from operations and normalized FFO , adjusted EBITDA , net operating income , or NOI , and cash NOI .
Speaker #5: A reconciliation of these non-GAAP measures to net income is available in our financial results package, which can be found on our website.
Speaker #5: I will now turn the call over to Yael .
Speaker #6: Thank you , Kevin , and good morning . I will begin today's call with a brief overview of ill portfolio and highlight our third quarter results before turning the call over to Mark to discuss our leasing activity and pipeline .
Yael Duffy: Thank you, Kevin, and good morning.
Yael Duffy: I will begin today's call with a brief overview of Industrial Logistics Properties Trust's portfolio and highlight our third quarter results before turning the call over to Marc to discuss our leasing activity and pipeline. From there, Tiffany will review our financial performance.
Speaker #6: From there , Tiffany will review our financial performance despite macroeconomic and tariff uncertainty . The industrial real estate sector continues to demonstrate resilience as reflected in our strong , solid third quarter results .
Yael Duffy: Despite macroeconomic and tariff uncertainty, the industrial.
Yael Duffy: Real estate sector continues to demonstrate resilience.
Yael Duffy: As reflected in our solid third quarter results, we are seeing tenants show greater confidence.
Speaker #6: We are seeing tenants show greater confidence in their long-term space needs, especially compared to the start of the year, and we are making significant progress addressing our 2026 and 2027 lease expirations.
Yael Duffy: In their long-term space needs, especially compared to the start of the year.
Yael Duffy: We are making significant progress addressing.
Yael Duffy: Our 2026 and 2027 lease expirations. Though industrial vacancy rates remain elevated compared to pandemic lows, new supply is limited.
Speaker #6: Though industrial vacancy rates remain elevated compared to pandemic lows , new supply is limited and long term demand drivers such as e-commerce growth and reshoring initiatives continue to underpin demand in the sector .
Yael Duffy: Long term demand drivers such as.
Yael Duffy: E-commerce growth and reshoring initiatives continue to underpin demand in the sector. Industrial Logistics Properties Trust's third quarter reflects continued demand for a high-quality portfolio of industrial and logistics properties and growth in many of our key metrics. Same property cash basis NOI increased 3% compared to the same period a year ago, supported by strong renewal activity and rent growth.
Speaker #6: I'll third quarter reflects continued demand for our high quality portfolio of industrial and logistics properties and growth in many of our key metrics .
Speaker #6: Same property , cash basis , NOI increased 3% compared to the same period a year ago , supported by strong renewal activity and rent growth .
Speaker #6: Additionally , normalized FFO increased over 100% year over year , primarily from the refinancing we executed in June . It's portfolio consists of 411 distribution and logistics properties across 39 states , totaling 60,000,000ft² , with a weighted average lease term of 7.4 years .
Yael Duffy: Additionally, normalized FFO increased over 100% year.
Yael Duffy: Over year, primarily from the refinancing we executed in June. Industrial Logistics Properties Trust's portfolio consists of 411 distribution and logistics properties across 39 states totaling 60 million square feet with a weighted average lease term of 7.4 years.
Speaker #6: Our well portfolio is further highlighted by our unique Hawaii footprint , consisting of 226 properties totaling 16 point 7,000,000ft² . Our portfolio has a weighted average lease term of six and a half years and is anchored by tenants with strong business profiles and stable cash flows .
Yael Duffy: Our well-diversified portfolio is further highlighted by our unique Hawaii footprint consisting of 226 properties totaling 16.7 million square feet. Our portfolio has a weighted average lease term of six and a half years.
Yael Duffy: It is anchored by tenants with strong business profiles and stable cash flows.
Speaker #6: Over 76% of our annualized revenues come from investment grade-rated tenants or from our secure Hawaii land leases. We finished the quarter with consolidated occupancy of 94.1%, outperforming the U.S. industrial average by 150 basis points.
Yael Duffy: Over 76% of our annualized revenues come.
Yael Duffy: From investment grade rated tenants or from our secure Hawaii land leases.
Yael Duffy: We finished the quarter with consolidated occupancy.
Yael Duffy: Of 94.1%, outperforming the U.S. Industrial Average by 150 basis points. Turning to our leasing activity, during the third quarter we completed 836,000 square feet of leasing, including a rent reset at weighted average rental rates that were 22% higher than prior rental rates for the same space and for an average lease term of eight years.
Speaker #6: Turning to our leasing activity during the third quarter , we completed 836,000ft² of leasing , including a rent reset at weighted average rental rates that were 22% higher than prior rental rates for the same space , and for an average lease term of eight years .
Speaker #6: Renewals accounted for 70% of our activity , highlighting strong tenant retention as we continue to execute on our leasing priorities . We are simultaneously focused on evaluating opportunities to improve our balance sheet and reduce leverage to that end , we have identified three properties for sale totaling 867,000ft² .
Yael Duffy: Renewals accounted for 70% of our activity.
Yael Duffy: Highlighting strong tenant retention. As we continue to execute on our leasing priorities, we are simultaneously focused on evaluating opportunities to improve our balance sheet and reduce leverage.
Yael Duffy: To that end, we have identified three.
Yael Duffy: Properties for sale totaling 867,000 square feet.
Speaker #6: We are in various stages of the sale process and anticipate a combined sales price of approximately $55 million . One property is encumbered by debt , and the proceeds from the sale will be used to partially repay its $700 million loan , which comes due in 2032 .
Yael Duffy: We are in various stages of the sale process and anticipate a combined sales price of approximately $55 million.
Yael Duffy: One property is encumbered by debt, and the proceeds from the sale will be used to partially repay ILPT's $700 million loan, which comes due in 2032. We anticipate these transactions to close in the fourth quarter and into early 2026. I will now turn the call over to Marc.
Speaker #6: We anticipate these these transactions to close in the fourth quarter and into early 2026 . I will now turn the call over to Mark .
Speaker #7: Thank you , and good morning . As I mentioned , we executed 836,000ft² of new and renewal leasing during the quarter , including one rent freeze .
Marc Krohn: Thank you and good morning. As Yael mentioned, we executed 836,000 square feet of new and renewal leasing during the quarter, including one rent resale. Renewals represented most of the leasing activity, and our mainland portfolio accounted for over 80% of the leasing volume, including notable transactions with FedEx and the United States Postal Service. Looking ahead, approximately 4% of ILPT's total annualized revenues are set to expire by the end of 2026, and approximately 11% expires in 2027. Our leasing pipeline continues to grow and now exceeds 8 million square feet, with the majority relating to renewal discussions. For leases expiring in 2026 and 2027, we anticipate a near term conversion of approximately 75% of our pipeline, which is in advanced stages of negotiation or lease documentation.
Speaker #7: Day renewals representing most of the leasing activity . And our mainland portfolio accounted for over 80% of the leasing volume , including notable transactions with Fedex and the United States Postal Services .
Speaker #7: Looking ahead , approximately 4% of its total annualized revenues are set to expire by the end of 2026 , and approximately 11% expires in 2027 .
Speaker #7: Our leasing pipeline continues to grow and now exceeds 8,000,000 sq. ft., with the majority relating to renewal discussions and leases expiring in 2026 and 2027.
Speaker #7: We anticipate a near-term conversion of approximately 75% of our pipeline , which is an advanced stages of negotiation or lease documentation . Additionally , our leasing pipeline could result in positive net absorption of 3,000,000ft² , including continued interest for our vacancies in Hawaii and Indiana .
Marc Krohn: Additionally, our leasing pipeline could result in positive net absorption of 3 million square feet, including continued interest for our vacancies in Hawaii and Indianapolis. Overall, we expect the leasing in our pipeline to yield average roll ups in rent of 20% on the mainland and 30% in Hawaii, further supporting our objective of enhancing cash flow and creating long term value for our shareholders. I will now turn the call over to Tiffany.
Speaker #7: Overall , we expect leasing in our pipeline to yield average roll ups in rent of 20% on the mainland and 30% in Hawaii .
Speaker #7: Further supporting our objective of enhancing cash flow and creating long term value for our shareholders . I will now turn the call over to Tiffany .
Speaker #8: Thank you . Mark . Good morning everyone . Yesterday we reported third quarter normalized FFO of $17.4 million , or $0.26 per share , which was in line with our expectations and represents an increase of 26% on a sequential quarter basis and 116% compared to the same quarter a year ago .
Yael Duffy: Thank you, Marc.
Tiffany Tsai: Good morning everyone. Yesterday we reported third quarter normalized FFO of $17.4 million or $0.26 per share, which was in line with our expectations.
Tiffany Tsai: This represents an increase of 26% on a sequential quarter basis and 116% compared to the same quarter a year ago.
Speaker #8: Same property NOI was $86.4 million and same property cash basis . NOI was $84.2 million . Both representing an increase on a year over year and sequential quarter basis , supported by strong tenant retention and rent roll ups .
Tiffany Tsai: Same property NOI was $86.4 million.
Tiffany Tsai: Same property cash basis NOI was $84.2 million, both representing an increase on a year over year and sequential quarter basis.
Tiffany Tsai: Supported by strong tenant retention and rent roll-ups. Adjusted EBITDAre ended the quarter at $84.1 million.
Speaker #8: Adjusted EBITDA ended the quarter at $84.1 million . Interest expense decreased by $4.4 million compared to the second quarter of 2025 , to $63.5 million , reflecting the impact of our $1.16 billion fixed rate debt refinancing completed in June .
Tiffany Tsai: Interest expense decreased by $4.4 million compared to the second quarter of 2025 to $63.5 million, reflecting the impact of our $1.16 billion fixed rate debt refinancing completed in June. We expect interest expense to remain flat in the fourth quarter with $58.5 million of cash interest expense and $5 million of non-cash amortization of financing and interest rate cap costs.
Speaker #8: We expect interest expense to remain flat in the fourth quarter , with $8.5 million of cash interest expense and $5 million of non-cash amortization of financing and interest rate cap costs .
Speaker #8: As I mentioned , we have three properties held for sale during the quarter . We recognized a $6.1 million impairment charge on one of those properties to write down its carrying value to its estimated sales price , less cost of sale at September 30th , the carrying value of the three healthcare sale properties was approximately $31 million .
Tiffany Tsai: As Yael mentioned, we have three properties.
Tiffany Tsai: Held for sale during the quarter, we recognized a $6.1 million impairment charge on one of those properties to write down its carrying value to its estimated sales price.
Tiffany Tsai: Less cost to sell at September 30.
Tiffany Tsai: The carrying value of the three held for sale properties was approximately $31 million. Turning to our balance sheet, we ended the quarter with cash on hand of $83 million and restricted cash of $95 million.
Speaker #8: Turning to our balance sheet, we ended the quarter with cash on hand of $83 million and restricted cash of $95 million. Our net debt to total assets ratio decreased slightly to 69.3%, and our net debt coverage ratio remained unchanged at 12 times.
Tiffany Tsai: Our net debt to total assets ratio.
Tiffany Tsai: Decreased slightly to 69.3% and our net debt coverage ratio remained unchanged at 12 times. All of ILPT's debt is currently carried at a fixed rate or is fixed through an interest rate cap. With a weighted average interest rate of 5.43% as of September 30, ILPT has no debt maturities until 2029 except for the $1.4 billion floating rate loan related to our consolidated joint venture, including its remaining extension options. This loan is not due until 2027.
Speaker #8: All of its debt is currently carried at a fixed rate or is fixed through an interest rate cap , with a weighted average interest rate of 5.43% .
Speaker #8: As of September 30, it has no debt maturities until 2029, except for the $1.4 billion floating rate loan related to our consolidated joint venture, including its remaining extension option.
Speaker #8: This loan is not due until 2027 , providing us with flexibility to continue monitoring the capital . The capital markets as we evaluate opportunities to move to a fixed rate , extend the maturity and reduce our overall leverage .
Tiffany Tsai: Providing us with flexibility to continue monitoring.
Tiffany Tsai: The capital markets as we evaluate opportunities to move to a fixed rate, extend the maturity, and reduce our overall leverage. In closing, Industrial Logistics Properties Trust's operating and financial performance during the.
Speaker #8: In closing , I ipts operating and financial performance during the third quarter remained strong and continues to benefit from our high quality industrial portfolio .
Tiffany Tsai: Third quarter remains strong and continues to.
Tiffany Tsai: Benefit from our high quality industrial portfolio.
Speaker #8: Investment grade tenant roster and skilled asset management and leasing teams . Looking ahead to the fourth quarter of 2025 , we expect normalized FFO to be between 27 and $0.29 per share , excluding incentive fees and adjusted EBITDA .
Tiffany Tsai: Investment grade tenant roster and skilled asset.
Tiffany Tsai: Management and leasing teams. Looking ahead to the fourth quarter of 2025, we expect normalized FFO to be between $0.27 and $0.29 per share, excluding incentive fees, and adjusted EBITDAre between $84 million and $85 million.
Speaker #8: Between 84 and $85 million . That concludes our prepared remarks . Operator please open the line for questions .
Tiffany Tsai: That concludes our prepared remarks. Operator, please open the line for questions.
Speaker #4: We will now begin the question and answer session . To ask a question , you may press star , then one on your telephone keypad .
Operator: We will now begin the question and answer session. To ask a question, you may press Star then one on your telephone keypad. If you're using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press Star then two. At this time, we will pause momentarily to assemble our roster. The first question comes from John Massocca with B. Riley. Please go ahead.
Speaker #4: If you're using a speakerphone , please pick up your handset before pressing the keys . If at any time your question has been addressed and you would like to withdraw your question , please press star then two .
Speaker #4: At this time , we will pause momentarily to assemble our roster . The first question comes from John Massocca with B Riley . Please go ahead .
Speaker #9: Good morning . Maybe touching on guidance first . I noticed it was net of or not including incentive fees to external manager . Do you have any kind of range or expecting for what ?
John Massocca: Good morning. Maybe touching on guidance first, I noticed it was net of or not including incentive fees to the external manager. Do you have any kind of range you're expecting for what those fees may be? I know it's contingent on the stock price performance, but I guess maybe based on where the stock would be today.
Speaker #9: Those fees may be ? I know it's contingent on the stock price performance , but I guess maybe based on where the stock would be today , how would that look ?
Marc Krohn: How would that look?
Speaker #9: And just to confirm , is that going to flow through your reported normalized FFO per share number in for Q .
John Massocca: Just to confirm, is that going to flow through your reported normalized FFO per share number in Q4?
Speaker #8: All right . So if we were to use results as of September 30th , we would pay full year incentive fee of $6.3 million .
Tiffany Tsai: All right, if we were to use results as of September 30, we would pay full year incentive fee of $6.3 million, which would we would record less than $2 million in Q4 for that to get to that amount. We do not plan on including that in normalized FFO for Q4.
Speaker #8: Which would we would record less than $2 million in Q4 for that to get to that amount . We do not plan on including that in normalized FFO for Q4 .
Speaker #9: Even that would be a cash payment . You would basically be paying a full cash payment for the year in for Q though , if we're thinking about CAD and cash flow .
John Massocca: That would be a cash payment. You would basically be paying a full cash payment for the year in Q4, though, if we're thinking about CAD.
Marc Krohn: Cash flow.
Speaker #8: Is paid in January of 2026.
Tiffany Tsai: It's paid in January.
John Massocca: 2016, paid in Q1. Would that impact then the Q1 2026 normalized FFO per share number?
Speaker #9: Paid in one Q would that impact then the one Q 26 normalized FFO per share number ?
Speaker #8: It's in January , so .
Tiffany Tsai: It's in January.
Speaker #9: Okay , maybe I'm just saying , like , is that essentially you're thinking about normalized , maybe even on a go forward basis , if there are more incentive fees that are paid in future years , right .
John Massocca: Okay, maybe I'm just saying like is that essentially if you're thinking about normalized FFO, maybe even on a go forward basis, if there are more incentive fees that are paid in future years. Right. Obviously you back that out of normalized FFO because it's kind of an accrual. Right. In kind of past quarters.
Speaker #9: Obviously , you back that out of normalized FFO because it's kind of an accrual . Right . And kind of past quarters , right .
Tiffany Tsai: Right.
Speaker #9: As it as as it's paid out in cash , I mean , that is going to impact the normalized FFO number as it is reported .
John Massocca: As it's paid out in cash, that is going to impact the normalized FFO number as it is reported.
Speaker #8: Normalized FFO is intended to exclude one time non-recurring activities . And so this is not a normal payment that we've had in recent times .
Tiffany Tsai: Normalized FFO is intended to exclude.
John Massocca: One.
Tiffany Tsai: Time non-recurring activities. This is not a normal payment that we've had in recent times.
Speaker #8: I hope that's helpful .
Tiffany Tsai: I hope that's helpful.
Speaker #9: Okay . And maybe moving on to the the portfolio itself , you know , notice the positive GAAP leasing spreads on the overall portfolio .
John Massocca: Maybe moving on to the portfolio itself, noticed the positive GAAP leasing spreads on the overall portfolio, but it seemed like the mainland wholly owned assets only saw a 1.8% increase in GAAP rent. Was there something specific driving that, maybe one re-leasing transaction, or just curious why that number was so much lower than the rest of the portfolio?
Speaker #9: But seemed like the mainland wholly owned assets only saw a 1.8% increase in GAAP rent . Was there something specific driving that ? Maybe one , you know , releasing transaction or just kind of curious why that number was so much lower than the rest of the portfolio ?
Speaker #6: No , I . Hi , John , I think it was really one deal that kind of drove down the deal with the United States Postal Service was just about a 2% GAAP roll up .
Marc Krohn: No.
Yael Duffy: Hi John. I think it was really one deal that kind of drove down. The deal with the United States Postal Service was just about a 2% gap roll up. This is a little bit of a unique building, and we were happy to be able to get at least, but it wasn't at the spreads that.
Speaker #6: This is a little bit of a unique building . And so we were happy to be able to get at least . But it wasn't at the spreads that we usually see .
Tiffany Tsai: We usually see.
Speaker #9: In terms of the dispositions , how much of any of the 55 million includes the user owner buyer ? That was discussed last quarter ?
John Massocca: In terms of the dispositions, how much of any of the $55 million includes the user owner buyer that was discussed last quarter? I guess maybe as well, what are you kind of seeing today on pricing for those sales, maybe in terms of cap rate and even if you have it, a kind of price per square foot.
Speaker #9: And I guess maybe as well . What do you kind of seeing today on pricing for those sales ? Maybe in terms of cap rate and even if you have it price per square foot ?
Speaker #6: Sure. So the one we have the property to the owner user is really the bulk of the proceeds, about $50 million of it actually.
Yael Duffy: Sure. The one we, the property to the owner user, is really the bulk of the proceeds, about $50 million of it actually. The other, you know, the unique situation because it's an owner user and they generally pay a premium. The cap rate there would be under 6%. The other two are both vacant properties and one is actually also being sold to an owner user. I would say they're paying a premium. The third property, it's early days in our process. I don't have pricing guidance, at least at the moment.
Speaker #6: And the other , you know , the unique situation because it's an owner user and they generally pay a premium . So that's the cap rate .
Speaker #6: There would be under 6% . And then the other two are both vacant properties . And one is actually also being sold to an owner user .
Speaker #6: And so I would say they're paying a premium . And the third property , it's early days in our process . So I don't have pricing guidance , at least at the moment .
Speaker #9: Okay . And then in terms of the impairment , was that driven by the vacant asset sales ?
John Massocca: Okay, in terms of the impairment, was that driven by the vacant asset sales?
Speaker #10: Yes .
Tiffany Tsai: Yes.
Speaker #9: And then , you know , as we look out into 2026 , what are you seeing in terms of kind of the disposition opportunity set ?
John Massocca: As we look down at 2026, what are you seeing in terms of the disposition opportunity set? Is there an opportunity to do more transactions? Do you want to shore up the balance sheet on the Mountain JV side before you get more active overall in the portfolio? In terms of selling assets to delever, is that a strategic priority? Any kind of color on what you're expecting in 2026 from a sales perspective?
Speaker #9: I mean , is there an opportunity to do more transactions ? Do you kind of want to shore up the balance sheet on the mountain ?
Speaker #9: JV side before you get more active overall in the portfolio in terms of selling assets to deliver ? I mean , is that strategic priority ?
Speaker #9: You know , just just any kind of color on what you're expecting in 2026 from a from a sales perspective ?
Speaker #6: So, you know, we’re constantly evaluating the portfolio and opportunities where we’ve either maximized value or pruned the portfolio to kind of optimize it.
Yael Duffy: We're constantly evaluating the portfolio and really opportunities where we've either maximized value or pruning the portfolio to kind of optimize it. I do think we will. You might see us selling some more properties in 2026. They might be within the Mountain joint venture. I don't know if it'll be coinciding with a potential refinancing or beforehand. I think that's where you'll see most of the disposition activity, if there is any.
Speaker #6: I do think we will, you might see us selling some more properties in 2026. They might be within the mountain joint venture.
Speaker #6: I don't know if it'll be , you know , coinciding with a potential refinancing or beforehand . So I , I think that's where you'll see most of .
Speaker #6: The disposition activity . If there is any .
Speaker #9: Okay . Does completing a refinancing open up more assets to sell in that JV or are you pretty open just given the structure of that debt to to sell assets out of that JV as you see fit or as opportunities arise .
John Massocca: Does completing the refinancing open up more assets to sell in that JV, or are you pretty open just given the structure of that debt to sell assets out of that JV as you see fit or as opportunities arise?
Speaker #6: As opportunities arise ? We do have flexibility . So the refinancing is not really reliant on the refinancing .
Yael Duffy: As opportunities arise, we do have flexibility. The refinancing is not really relying on the refinancing.
Speaker #9: Okay . And then one last one , you kind of mentioned in the prepared remarks . But any update particularly on on potential lease up in Indianapolis , I know Hawaii is kind of a unique situation , but any kind of progress on the on the leasing front in Indianapolis ?
John Massocca: Okay, and then one last one. You kind of mentioned it in the prepared remarks, but any update, particularly on potential lease up in Indianapolis? I know Hawaii is kind of a unique situation, but any kind of progress on the leasing front in Indianapolis?
Speaker #7: I can certainly jump in on Indianapolis . We have three proposals out right now . We're we're very optimistic . But , you know , realistic in many ways .
Marc Krohn: I can certainly jump in on Indianapolis. We have three proposals out right now. We're very optimistic, but realistic in many ways. Perhaps we can lease that up in the first half of next year.
Speaker #7: And so perhaps , you know , we can lease that up in the first half of next year .
Speaker #9: I really appreciate that color . Good .
John Massocca: I really appreciate that. Color? Good.
Speaker #6: Sorry, I didn't know if you wanted an update on Hawaii as well. So, we have one tenant, one prospect, actually a full site user.
Yael Duffy: Sorry, I didn't know if you wanted an update on Hawaii as well. We have one tenant, one prospect, actually a full site user that's in diligence.
Speaker #6: That's in diligence . And so , you know , John , you're a little bit new to the story . But it it does take a long time for this parcel because it's undeveloped land .
Yael Duffy: You know, John, you're a.
Yael Duffy: Little bit new to the story, but it does take a long time for this parcel because it's undeveloped land. They're about halfway through an access agreement that's 90 days, and they're digging in. We're hopeful that this could lead to a lease.
Speaker #6: But there are about halfway through an access agreement that's 90 days . And they're digging in . So we're hopeful that this could lead to a lease .
Speaker #9: And then one last one with kind of leasing in mind . You , anything else to be aware of on the leasing front or the renewal front in 2026 ?
John Massocca: One last question with leasing in mind. Is there anything else to be aware of on the leasing front or the renewal front in 2026 as we start to build out the model for that and impacting potentially 2027 numbers?
Speaker #9: As we start to build out the model for that and impacting potentially 27 numbers.
Speaker #6: No , I mean , we're making good progress on our 26 and 27 expirations . As Mark mentioned in the prepared remarks that we're we're have a lot of signed Lois or active lease negotiations .
Yael Duffy: No, I mean, we're making good progress on our 2026 and 2027 expirations, as Marc mentioned in the prepared remarks, that we have a lot of signed LOIs or active lease negotiations.
Speaker #6: And there isn't anything material in terms of expected vacates .
Yael Duffy: There isn't anything material in terms of expected vacates.
Speaker #11: Okay .
Speaker #9: I appreciate all that . That's it for me . Thank you very much .
John Massocca: I appreciate all that. That's it for me. Thank you very much.
Speaker #4: Again , if you have a question , please press star then one . This concludes our question and answer session . I would like to turn the conference back over to Yael Duffy President and Chief Operating Officer for any closing remarks .
Operator: Again, if you have a question, please press star then 1. This concludes our question and answer session. I would like to turn the conference back over to Yael Duffy, President and Chief Operating Officer, for any closing remarks.
Speaker #6: Thanks for joining our call today . Please reach out to Investor Relations . If you're interested in scheduling a meeting with Iopt . Operator .
Yael Duffy: Thanks for joining our call today.
Yael Duffy: Please reach out to Investor Relations if you're interested in scheduling a meeting with Industrial Logistics Properties Trust. Operator.
Speaker #6: That concludes the call .
Tiffany Tsai: That concludes the call.
Operator: The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.