Office Properties Income Trust Announces ATM Offering

Office Properties Income Trust (NASDAQ:OPI) has announced the launch of an at-the-market (ATM) equity offering program, according to a recent SEC filing. The real estate investment trust, which is managed by The RMR Group (NASDAQ:RMR), is set to offer common shares with an aggregate sales price of up to $99,655,398 through Clear Street LLC, the designated agent. The announcement comes as the company's stock trades near its 52-week low of $0.36, having declined nearly 79% over the past year, according to InvestingPro data.

This move comes as part of the company's effective shelf registration statement and follows a sales agreement dated March 14, 2025, initially disclosed in a Form 8-K filed on the same date. The ATM offering allows Office Properties Income Trust to sell shares over time, providing the company with flexible access to capital markets. With a current market capitalization of just $25.28 million and EBITDA of $272.22 million, InvestingPro analysis reveals the company maintains a strong current ratio of 3.88, indicating sufficient liquidity to meet short-term obligations.

Legal opinions regarding the validity of the common shares and certain tax matters have been provided by Venable LLP and Sullivan & Worcester LLP, respectively, and are included as exhibits in the SEC filing. The opinions serve to confirm the legal standing of the shares being offered and address tax implications related to the offering.

The company's common shares are traded on The Nasdaq Stock Market under the ticker symbol OPI, and its 6.375% Senior Notes due 2050 are also listed on Nasdaq with the symbol OPINL. The ATM offering is expected to enhance the company's capital structure and support its ongoing operations and investment strategies. Despite recent market challenges, the company maintains a significant dividend yield of 10.53%, though InvestingPro subscribers can access 18 additional key insights about OPI's financial health and market position through the platform's comprehensive Pro Research Report.

Investors and market watchers will be monitoring the progress of this offering, as it represents a significant financial maneuver by Office Properties Income Trust. The company has not disclosed specific timing for the sales under the ATM offering, indicating that transactions will occur from time to time as market conditions warrant. With annual revenue of $501.98 million and an overall financial health score rated as 'WEAK' by InvestingPro, the success of this offering could be crucial for the company's future performance.

This news is based on a press release statement and the details of the offering are subject to change based on market conditions and other factors that may influence the company's capital raising efforts.

In other recent news, Office Properties Income Trust has received a notification from The Nasdaq Stock Market LLC about the risk of delisting. The company's shares have closed below the minimum required bid price of $1.00 for 30 consecutive business days, prompting a 180-day grace period to regain compliance. Additionally, Office Properties Income Trust has expanded its share authorization, increasing its authorized common shares from 200 million to 250 million and establishing an "at the market" equity offering program. This move allows the company to sell up to $100 million of its common shares, providing additional liquidity for general business purposes.

S&P Global has downgraded the issuer credit rating of Office Properties Income Trust to 'CC' from ' CCC (WA:CCCP)' due to a proposed debt exchange offer. The exchange is considered a distressed transaction, which could lead to a selective default rating if completed. However, the company has also seen an upgrade in its issuer credit rating to 'CCC' from 'CCC-' following a recent private exchange offer, although the outlook remains negative. The company closed 17 property sales in the fourth quarter of 2024 for $114.5 million, which, along with cash on hand, will be used to repay outstanding notes. Despite these developments, Office Properties Income Trust continues to face significant refinancing risks and challenges in its operating performance.

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