Select Income REIT Exhibit 99.2 7958 South Chester Street, Centennial, CO Square Feet: 167,917 Third Quarter 2018 United Launch Alliance Corporate HeadquartersSupplemental Operating and Financial Data 1800 Novell Place, Provo, UT Square Feet: 405,699 Tenant: Micro Focus Software, Inc. 1 All amounts in this report are unaudited.
TABLE OF CONTENTS PAGE/EXHIBIT CORPORATE INFORMATION Company Profile 8 Investor Information 9 Research Coverage 10 FINANCIALS Key Consolidated Financial Data 12 Condensed Consolidated Balance Sheets 13 Condensed Consolidated Statements of Income 14 Condensed Consolidated Statements of Cash Flows 16 Financial Information by Owner 18 Consolidated Debt Summary 19 Consolidated Debt Maturity Schedule 21 TABLE OF CONTENTS TABLE Consolidated Leverage Ratios, Coverage Ratios and Public Debt Covenants 22 Consolidated Capital Expenditures Summary 23 Consolidated Property Acquisitions and Dispositions Information Since 1/1/18 24 Calculation and Reconciliation of Property Net Operating Income (NOI) and Cash Basis NOI 25 Reconciliation of NOI to Same Property NOI and Calculation of Same Property Cash Basis NOI 27 Calculation and Reconciliation of NOI, Cash Basis NOI, Same Property NOI and Same Property Cash Basis NOI by Segment 28 Calculation of EBITDA and Adjusted EBITDA 30 Calculation of Funds from Operations (FFO) Attributed to SIR and Normalized FFO Attributed to SIR 31 Definitions of Certain Non-GAAP Financial Measures 33 PORTFOLIO INFORMATION Consolidated Portfolio Summary by Owner 35 Consolidated Same Property Results of Operations 36 Leasing Summaries: Consolidated 38 SIR (excluding ILPT) 39 ILPT 40 Consolidated Occupancy and Leasing Analysis by Owner 41 Consolidated Tenant Diversity and Credit Characteristics 42 Tenants Representing 1% or More of Total Consolidated Annualized Rental Revenues 43 Consolidated Three Year Lease Expiration Schedule by Owner 44 Portfolio Lease Expiration Schedules: Consolidated 45 SIR (excluding ILPT) 46 ILPT 47 Hawaii Land Rent Reset Summary 48 EXHIBIT A Consolidated Property Detail 50 References and data in this Supplemental Operating and Financial Data report to "SIR", "we", "us" or "our" refer to and include data for Select Income REIT and its consolidated subsidiaries, including its majority owned subsidiary, Industrial Logistics Properties Trust and its consolidated subsidiaries, or ILPT, which was Select Income REIT's wholly owned subsidiary for all periods until January 17, 2018, unless the context indicates otherwise. As previously announced, Government Properties Income Trust, or GOV, a wholly owned subsidiary of GOV and SIR entered into an agreement and plan of merger, dated as of September 14, 2018, or the Merger Agreement, whereby SIR will merge with and into GOV's wholly owned subsidiary. These historical results of operations and financial position include certain transaction and acquisition related expenses that we incurred in connection with the Merger Agreement and the other transactions contemplated by the Merger Agreement. Select Income REIT 2 Supplemental Operating and Financial Data, September 30, 2018
WARNING CONCERNING FORWARD LOOKING STATEMENTS THIS PRESENTATION OF SUPPLEMENTAL OPERATING AND FINANCIAL DATA CONTAINS STATEMENTS THAT CONSTITUTE FORWARD LOOKING STATEMENTS WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 AND OTHER SECURITIES LAWS. ALSO, WHENEVER WE USE WORDS SUCH AS “BELIEVE”, “EXPECT”, “ANTICIPATE”, “INTEND”, “PLAN”, “ESTIMATE”, “WILL”, “MAY” AND NEGATIVES OR DERIVATIVES OF THESE OR SIMILAR EXPRESSIONS, WE ARE MAKING FORWARD LOOKING STATEMENTS. THESE FORWARD LOOKING STATEMENTS ARE BASED UPON OUR PRESENT INTENT, BELIEFS OR EXPECTATIONS, BUT FORWARD LOOKING STATEMENTS ARE NOT GUARANTEED TO OCCUR AND MAY NOT OCCUR. FORWARD LOOKING STATEMENTS IN THIS REPORT RELATE TO VARIOUS ASPECTS OF OUR BUSINESS, INCLUDING: • THE LIKELIHOOD THAT WE WILL COMPLETE OUR PENDING MERGER, OR THE MERGER, INTO A WHOLLY OWNED SUBSIDIARY OF GOV, • THE LIKELIHOOD THAT OUR TENANTS WILL PAY RENT OR BE NEGATIVELY AFFECTED BY CYCLICAL ECONOMIC CONDITIONS, • THE LIKELIHOOD THAT OUR TENANTS WILL RENEW OR EXTEND THEIR LEASES OR THAT WE WILL BE ABLE TO OBTAIN REPLACEMENT TENANTS, • OUR ACQUISITIONS OF PROPERTIES, • OUR SALES OF PROPERTIES, • OUR ABILITY TO COMPETE FOR ACQUISITIONS AND TENANCIES EFFECTIVELY, • THE LIKELIHOOD THAT OUR RENTS WILL INCREASE WHEN WE RENEW OR EXTEND OUR LEASES, WHEN WE ENTER NEW LEASES, OR WHEN OUR RENTS RESET, INCLUDING RENT RESETS AT OUR SUBSIDIARY, ILPT'S, HAWAII PROPERTIES, • THE LIKELIHOOD THAT WE WILL PAY THE DISTRIBUTION OF ILPT'S COMMON SHARES, • OUR ABILITY TO PAY DISTRIBUTIONS TO OUR SHAREHOLDERS AND TO SUSTAIN THE AMOUNT OF SUCH DISTRIBUTIONS, • THE FUTURE AVAILABILITY OF BORROWINGS UNDER OUR REVOLVING CREDIT FACILITY OR ILPT'S REVOLVING CREDIT FACILITY, • OUR POLICIES AND PLANS REGARDING INVESTMENTS, FINANCINGS AND DISPOSITIONS, • OUR ABILITY TO RAISE DEBT OR EQUITY CAPITAL, • OUR ABILITY TO PAY INTEREST ON AND PRINCIPAL OF OUR DEBT, • OUR ABILITY TO APPROPRIATELY BALANCE OUR USE OF DEBT AND EQUITY CAPITAL, • OUR ABILITY TO SUCCESSFULLY AND PROFITABLY COMPLETE EXPANSION AND RENOVATION PROJECTS AT OUR PROPERTIES AND TO REALIZE OUR EXPECTED RETURNS ON THOSE PROJECTS, • OUR CREDIT RATINGS, • OUR EXPECTATION THAT OUR SHAREHOLDERS BENEFIT FROM OUR OWNERSHIP INTEREST IN AND OTHER RELATIONSHIPS WITH ILPT, • OUR EXPECTATION THAT OUR SHAREHOLDERS WILL BENEFIT FROM THE MERGER, • OUR EXPECTATION THAT WE BENEFIT FROM OUR OWNERSHIP INTEREST IN AND OTHER RELATIONSHIPS WITH THE RMR GROUP INC., OR RMR INC., • OUR EXPECTATION THAT WE BENEFIT FROM OUR OWNERSHIP INTEREST IN AND OTHER RELATIONSHIPS WITH AFFILIATES INSURANCE COMPANY, OR AIC, AND FROM OUR PARTICIPATION IN INSURANCE PROGRAMS ARRANGED BY AIC, • OUR QUALIFICATION FOR TAXATION AS A REAL ESTATE INVESTMENT TRUST, OR REIT, AND ILPT'S ABILITY TO QUALIFY AND MAINTAIN ITS QUALIFICATION FOR TAXATION AS A REIT, • THE CREDIT QUALITIES OF OUR TENANTS, AND • OTHER MATTERS. WARNING CONCERNING FORWARD LOOKING STATEMENTS CONCERNING FORWARD WARNING OUR ACTUAL RESULTS MAY DIFFER MATERIALLY FROM THOSE CONTAINED IN OR IMPLIED BY OUR FORWARD LOOKING STATEMENTS AS A RESULT OF VARIOUS FACTORS. FACTORS THAT COULD HAVE A MATERIAL ADVERSE EFFECT ON OUR FORWARD LOOKING STATEMENTS AND UPON OUR BUSINESS, RESULTS OF OPERATIONS, FINANCIAL CONDITION, FUNDS FROM OPERATIONS, OR FFO, ATTRIBUTED TO SELECT INCOME REIT, OR SIR, NORMALIZED FUNDS FROM OPERATIONS, OR NORMALIZED FFO, ATTRIBUTED TO SIR, NET OPERATING INCOME, OR NOI, CASH BASIS NOI, EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION, OR EBITDA, EBITDA AS ADJUSTED, OR ADJUSTED EBITDA, CASH FLOWS, LIQUIDITY AND PROSPECTS INCLUDE, BUT ARE NOT LIMITED TO: Select Income REIT 3 Supplemental Operating and Financial Data, September 30, 2018
WARNING CONCERNING FORWARD LOOKING STATEMENTS (CONTINUED) • THE IMPACT OF CONDITIONS AND CHANGES IN THE ECONOMY AND THE CAPITAL MARKETS ON US AND OUR TENANTS, • COMPETITION WITHIN THE REAL ESTATE INDUSTRY, PARTICULARLY IN THOSE MARKETS IN WHICH OUR PROPERTIES ARE LOCATED, • COMPLIANCE WITH, AND CHANGES TO, FEDERAL, STATE AND LOCAL LAWS AND REGULATIONS, ACCOUNTING RULES, TAX LAWS AND SIMILAR MATTERS, • LIMITATIONS IMPOSED ON OUR BUSINESS AND OUR ABILITY TO SATISFY COMPLEX RULES IN ORDER FOR US TO QUALIFY FOR TAXATION AS A REIT FOR U.S. FEDERAL INCOME TAX PURPOSES, • ACTUAL AND POTENTIAL CONFLICTS OF INTEREST WITH OUR RELATED PARTIES, INCLUDING OUR MANAGING TRUSTEES, THE RMR GROUP LLC, OR RMR LLC, RMR INC., ILPT, GOV, AIC, AND OTHERS AFFILIATED WITH THEM, AND • ACTS OF TERRORISM, OUTBREAKS OF SO CALLED PANDEMICS OR OTHER MANMADE OR NATURAL DISASTERS BEYOND OUR CONTROL. FOR EXAMPLE: • OUR ABILITY TO MAKE FUTURE DISTRIBUTIONS TO OUR SHAREHOLDERS AND TO MAKE PAYMENTS OF PRINCIPAL AND INTEREST ON OUR INDEBTEDNESS DEPENDS UPON A NUMBER OF FACTORS, INCLUDING OUR FUTURE EARNINGS, THE CAPITAL COSTS WE INCUR TO LEASE OUR PROPERTIES, OUR WORKING CAPITAL REQUIREMENTS AND OUR RECEIPT OF DISTRIBUTIONS FROM ILPT. WE MAY BE UNABLE TO PAY OUR DEBT OBLIGATIONS OR TO MAINTAIN OUR CURRENT RATE OF DISTRIBUTIONS ON OUR COMMON SHARES AND FUTURE DISTRIBUTIONS MAY BE REDUCED OR ELIMINATED, • OUR ABILITY TO GROW OUR BUSINESS AND INCREASE OUR DISTRIBUTIONS DEPENDS IN LARGE PART UPON OUR ABILITY TO BUY PROPERTIES AND LEASE THEM FOR RENTS, LESS THEIR PROPERTY OPERATING COSTS, THAT EXCEED OUR CAPITAL COSTS. WE MAY BE UNABLE TO IDENTIFY PROPERTIES THAT WE WANT TO ACQUIRE OR TO NEGOTIATE ACCEPTABLE PURCHASE PRICES, ACQUISITION FINANCING OR LEASE TERMS FOR NEW PROPERTIES, • CONTINGENCIES IN OUR ACQUISITION AND SALE AGREEMENTS MAY NOT BE SATISFIED AND ANY EXPECTED ACQUISITIONS AND SALES MAY NOT OCCUR, MAY BE DELAYED OR THE TERMS OF SUCH TRANSACTIONS MAY CHANGE, • RENTS THAT WE CAN CHARGE AT OUR PROPERTIES MAY DECLINE BECAUSE OF CHANGING MARKET CONDITIONS OR OTHERWISE, • MOST OF ILPT'S HAWAII PROPERTIES ARE LANDS LEASED FOR RENTS THAT ARE PERIODICALLY RESET BASED ON THEN CURRENT FAIR MARKET VALUES. REVENUES FROM ILPT'S PROPERTIES IN HAWAII HAVE GENERALLY INCREASED DURING OUR AND OUR PREDECESSOR'S AND ILPT'S OWNERSHIP AS THE LEASES FOR THOSE PROPERTIES HAVE BEEN RESET OR RENEWED. ALTHOUGH ILPT EXPECTS THAT RENTS FOR ITS HAWAII PROPERTIES WILL INCREASE IN THE FUTURE, IT CANNOT BE SURE THEY WILL. FUTURE RENTS FROM THESE PROPERTIES COULD DECREASE OR NOT INCREASE TO THE EXTENT THEY HAVE IN THE PAST, • WE MAY NOT SUCCEED IN FURTHER DIVERSIFYING OUR REVENUE SOURCES AND ANY DIVERSIFICATION WE MAY ACHIEVE MAY NOT MITIGATE OUR PORTFOLIO RISKS OR IMPROVE THE SECURITY OF OUR REVENUES OR OUR OPERATING PERFORMANCE, • ILPT'S POSSIBLE REDEVELOPMENT OF CERTAIN OF ITS HAWAII PROPERTIES MAY NOT BE REALIZED OR BE SUCCESSFUL, • AS OF SEPTEMBER 30, 2018, WE HAD ESTIMATED LEASING RELATED OBLIGATIONS OF $23.8 MILLION. OUR LEASING RELATED OBLIGATIONS MAY COST MORE OR LESS AND MAY TAKE LONGER TO COMPLETE THAN WE EXPECT, AND OUR LEASING RELATED OBLIGATIONS MAY INCREASE, • THE UNEMPLOYMENT RATE OR ECONOMIC CONDITIONS IN AREAS WHERE OUR PROPERTIES ARE LOCATED MAY BECOME WORSE IN THE FUTURE. SUCH CIRCUMSTANCES OR OTHER CONDITIONS MAY REDUCE DEMAND FOR LEASING OFFICE AND INDUSTRIAL SPACE. IF THE DEMAND FOR LEASING OFFICE AND INDUSTRIAL SPACE IS REDUCED, WE MAY BE UNABLE TO RENEW LEASES WITH OUR TENANTS AS LEASES EXPIRE OR ENTER NEW LEASES AT RENTAL RATES AS HIGH AS EXPIRING RENTS AND OUR FINANCIAL RESULTS MAY DECLINE, • OUR BELIEF THAT THERE IS A LIKELIHOOD THAT TENANTS MAY RENEW OR EXTEND OUR LEASES PRIOR TO THEIR EXPIRATIONS WHENEVER THEY HAVE MADE SIGNIFICANT INVESTMENTS IN THE LEASED PROPERTIES, OR BECAUSE THOSE PROPERTIES MAY BE OF STRATEGIC IMPORTANCE TO THEM, MAY NOT BE REALIZED, • SOME OF OUR TENANTS MAY NOT RENEW EXPIRING LEASES, AND WE MAY BE UNABLE TO OBTAIN NEW TENANTS TO MAINTAIN OR INCREASE THE HISTORICAL OCCUPANCY RATES OF, OR RENTS FROM, OUR PROPERTIES, • WE MAY INCUR SIGNIFICANT COSTS TO PREPARE A PROPERTY FOR A TENANT, PARTICULARLY FOR SINGLE TENANT PROPERTIES, • INCREASING DEVELOPMENT OF INDUSTRIAL AND LOGISTICS PROPERTIES MAY REDUCE THE DEMAND FOR, AND ILPT'S RENTS FROM, ILPT'S PROPERTIES, WARNING CONCERNING FORWARD LOOKING STATEMENTS (CONTINUED) LOOKING STATEMENTS CONCERNING FORWARD WARNING Select Income REIT 4 Supplemental Operating and Financial Data, September 30, 2018
WARNING CONCERNING FORWARD LOOKING STATEMENTS (CONTINUED) • A FORMER TENANT OF TWO OF OUR PROPERTIES HAS FILED FOR BANKRUPTCY AND REJECTED ITS TWO LEASES WITH US. ALTHOUGH A SUBTENANT OF THAT FORMER TENANT AT ONE OF THE TWO PROPERTIES IS NOW CONTRACTUALLY OBLIGATED TO PAY RENT TO US IN AN AMOUNT EQUAL TO THE RENT UNDER THE FORMER TENANT'S LEASE, THAT SUBTENANT HAS CERTAIN RIGHTS TO TERMINATE ITS SUBLEASE, INCLUDING UPON ONE YEAR'S ADVANCE NOTICE, • A TENANT OF ONE OF OUR PROPERTIES HAS DEFAULTED ON ITS LEASE WITH US, AND WE AND THE TENANT THAT DEFAULTED HAVE ENTERED A LEASE AMENDMENT. UNDER THE TERMS OF SUCH LEASE AMENDMENT, THE TENANT THAT DEFAULTED HAS MADE CERTAIN PAYMENTS TO US, HAS ASSIGNED ITS SUBLEASES AT THE PROPERTY TO US AND HAS AGREED TO CONTINUE TO OCCUPY AND PAY RENT ON CERTAIN SPACE AT THE PROPERTY, BUT WE CANNOT BE SURE THAT THE TENANT WILL CONTINUE TO PAY SUCH RENTS, OR THAT WE WILL BE ABLE TO RECOVER ADDITIONAL AMOUNTS OR MITIGATE FURTHER OUR DAMAGES, • ONE OF ILPT'S TENANTS THAT REPRESENTS 1.1% OF OUR ANNUALIZED RENTAL REVENUES AS OF SEPTEMBER 30, 2018 HAS FILED FOR CHAPTER 11 BANKRUPTCY. ALTHOUGH THE TENANT HAS PAID ITS RENTAL OBLIGATIONS TO US THROUGH OCTOBER 2018, THE TENANT MAY NOT PAY FUTURE RENTS, MAY REJECT ONE OR MORE OF ITS LEASES AND/OR MAY SEEK TO RENEGOTIATE ITS LEASE OBLIGATIONS, • WE INTEND TO CONDUCT OUR BUSINESS ACTIVITIES IN A MANNER THAT WILL AFFORD US REASONABLE ACCESS TO CAPITAL FOR INVESTMENT AND FINANCING ACTIVITIES. HOWEVER, WE MAY NOT SUCCEED IN THIS REGARD AND WE MAY NOT HAVE REASONABLE ACCESS TO CAPITAL, • CONTINUED AVAILABILITY OF BORROWINGS UNDER OUR REVOLVING CREDIT FACILITY AND ILPT'S REVOLVING CREDIT FACILITY IS SUBJECT TO US AND ILPT, AS THE CASE MAY BE, SATISFYING CERTAIN FINANCIAL COVENANTS AND OTHER CREDIT FACILITY CONDITIONS THAT WE AND ILPT MAY BE UNABLE TO SATISFY, • ACTUAL COSTS UNDER OUR REVOLVING CREDIT FACILITY AND ILPT'S REVOLVING CREDIT FACILITY OR OTHER FLOATING RATE DEBT WILL BE HIGHER THAN LIBOR PLUS A PREMIUM BECAUSE OF FEES AND EXPENSES ASSOCIATED WITH SUCH DEBT, • WE MAY BE UNABLE TO REPAY OUR DEBT OBLIGATIONS WHEN THEY BECOME DUE, • THE MAXIMUM BORROWING AVAILABILITY UNDER OUR REVOLVING CREDIT FACILITY MAY BE INCREASED TO UP TO $1.85 BILLION IN CERTAIN CIRCUMSTANCES AND THE MAXIMUM BORROWING AVAILABILITY UNDER ILPT'S REVOLVING CREDIT FACILITY MAY BE INCREASED TO UP TO $1.5 BILLION IN CERTAIN CIRCUMSTANCES. HOWEVER, INCREASING THE MAXIMUM BORROWING AVAILABILITY UNDER OUR REVOLVING CREDIT FACILITY OR ILPT'S REVOLVING CREDIT FACILITY IS SUBJECT TO US AND ILPT, AS THE CASE MAY BE, OBTAINING ADDITIONAL COMMITMENTS FROM LENDERS, WHICH MAY NOT OCCUR, • WE HAVE THE OPTION TO EXTEND THE MATURITY DATE OF OUR REVOLVING CREDIT FACILITY, AND ILPT HAS THE OPTION TO EXTEND THE MATURITY DATE OF ITS REVOLVING CREDIT FACILITY, UPON PAYMENT OF A FEE AND MEETING OTHER CONDITIONS, RESPECTIVELY. HOWEVER, THE APPLICABLE CONDITIONS MAY NOT BE MET, • WE RECEIVED AN ASSESSMENT FROM THE STATE OF WASHINGTON FOR REAL ESTATE EXCISE TAX, INTEREST AND PENALTIES OF $2.8 MILLION ON CERTAIN PROPERTIES WE ACQUIRED IN 2015. ALTHOUGH WE BELIEVE WE ARE NOT LIABLE FOR THIS TAX AND ARE DISPUTING THIS ASSESSMENT, WE MAY NOT SUCCEED IN HAVING ALL OR ANY PART OF THIS ASSESSMENT NULLIFIED, • THE PREMIUMS USED TO DETERMINE THE INTEREST RATE PAYABLE ON OUR REVOLVING CREDIT FACILITY AND ILPT'S REVOLVING CREDIT FACILITY, THE FACILITY FEE PAYABLE ON OUR REVOLVING CREDIT FACILITY AND THE UNUSED FEE PAYABLE ON ILPT'S REVOLVING CREDIT FACILITY ARE BASED ON OUR CREDIT RATINGS AND ILPT'S LEVERAGE, RESPECTIVELY. FUTURE CHANGES IN OUR CREDIT RATINGS AND ILPT'S LEVERAGE MAY CAUSE THE INTEREST AND FEES WE AND ILPT PAY, RESPECTIVELY, TO INCREASE, • RMR INC. MAY REDUCE THE AMOUNT OF DISTRIBUTIONS TO ITS SHAREHOLDERS, INCLUDING US, • ILPT MAY REDUCE THE AMOUNT OF DISTRIBUTIONS TO ITS SHAREHOLDERS, INCLUDING US, • THE BUSINESS AND PROPERTY MANAGEMENT AGREEMENTS BETWEEN US AND RMR LLC HAVE CONTINUING 20 YEAR TERMS. HOWEVER, THOSE AGREEMENTS PERMIT EARLY TERMINATION IN CERTAIN CIRCUMSTANCES. ACCORDINGLY, WE CANNOT BE SURE THAT THESE AGREEMENTS WILL REMAIN IN EFFECT FOR CONTINUING 20 YEAR TERMS, • WE BELIEVE THAT OUR RELATIONSHIPS WITH OUR RELATED PARTIES, INCLUDING RMR LLC, RMR INC., ILPT, GOV, AIC AND OTHERS AFFILIATED WITH THEM MAY BENEFIT US AND PROVIDE US WITH COMPETITIVE ADVANTAGES IN OPERATING AND GROWING OUR BUSINESS. HOWEVER, THE ADVANTAGES WE BELIEVE WE MAY REALIZE FROM THESE RELATIONSHIPS MAY NOT MATERIALIZE, • WE, GOV AND A WHOLLY OWNED SUBSIDIARY OF GOV HAVE ENTERED INTO A MERGER AGREEMENT, OR THE MERGER AGREEMENT. THE CLOSING OF THE MERGER IS SUBJECT TO THE SATISFACTION OR WAIVER OF CONDITIONS, INCLUDING THE RECEIPT OF REQUISITE APPROVALS BY OUR AND GOV'S SHAREHOLDERS. WE CANNOT BE SURE THAT ANY OR ALL OF SUCH CONDITIONS WILL BE SATISFIED OR WAIVED. ACCORDINGLY, THE MERGER MAY NOT CLOSE WHEN EXPECTED OR AT ALL, OR THE TERMS OF THE MERGER AND THE OTHER TRANSACTIONS MAY CHANGE, WARNING CONCERNING FORWARD LOOKING STATEMENTS (CONTINUED) LOOKING STATEMENTS CONCERNING FORWARD WARNING Select Income REIT 5 Supplemental Operating and Financial Data, September 30, 2018
WARNING CONCERNING FORWARD LOOKING STATEMENTS (CONTINUED) • AS NOTED ABOVE, THE MERGER WILL REQUIRE APPROVAL OF OUR SHAREHOLDERS AND THE ISSUANCE OF GOV'S COMMON SHARES IN THE MERGER WILL REQUIRE APPROVAL OF GOV'S SHAREHOLDERS. SUCH APPROVALS WILL BE SOLICITED BY A JOINT PROXY STATEMENT/PROSPECTUS, A PRELIMINARY VERSION OF WHICH WAS INCLUDED AS PART OF THE REGISTRATION STATEMENT ON FORM S-4, AS AMENDED, OR THE FORM S-4, FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, OR SEC. THE FORM S-4 MUST BE DECLARED EFFECTIVE BY THE SEC BEFORE THE DEFINITIVE JOINT PROXY STATEMENT/PROSPECTUS CAN BE MAILED TO OUR SHAREHOLDERS AND GOV'S SHAREHOLDERS. THE AMOUNT OF TIME IT TAKES FOR THE SEC TO DECLARE THE FORM S-4 EFFECTIVE IS BEYOND OUR AND GOV'S CONTROL. ACCORDINGLY, WE CANNOT BE SURE THAT THE MERGER AND THE OTHER TRANSACTIONS WILL BE CONSUMMATED WITHIN A SPECIFIED TIME PERIOD OR AT ALL OR THAT THE TERMS OF THE MERGER AND THE OTHER TRANSACTIONS WILL NOT CHANGE, • PURSUANT TO THE MERGER AGREEMENT, WE HAVE AGREED TO DISTRIBUTE ALL 45,000,000 OF THE COMMON SHARES OF ILPT THAT WE OWN TO OUR SHAREHOLDERS, SUBJECT TO THE SATISFACTION OR WAIVER OF CERTAIN CONDITIONS, INCLUDING, AMONG OTHER THINGS, OBTAINING THE REQUISITE SHAREHOLDER APPROVALS WITH RESPECT TO THE MERGER. WE CANNOT BE SURE WHEN OR IF THOSE CONDITIONS WILL BE SATISFIED OR WAIVED OR THAT SUCH DISTRIBUTION WILL OCCUR, AND • COMPLETION OF THE ILPT DISTRIBUTION IS NOT CONDITIONED UPON CONSUMMATION OF THE MERGER, AND THERE IS A RISK THAT THE ILPT DISTRIBUTION WILL BE COMPLETED AND THE MERGER NOT CONSUMMATED, LEAVING SIR A SIGNIFICANTLY SMALLER COMPANY THAT WILL NO LONGER BENEFIT FROM ILPT'S INCOME OR RECEIVE DISTRIBUTIONS FROM ILPT. CURRENTLY UNEXPECTED RESULTS COULD OCCUR DUE TO MANY DIFFERENT CIRCUMSTANCES, SOME OF WHICH ARE BEYOND OUR CONTROL, SUCH AS ACTS OF TERRORISM, NATURAL DISASTERS, CHANGES IN OUR TENANTS’ FINANCIAL CONDITIONS, THE MARKET DEMAND FOR LEASED SPACE OR CHANGES IN CAPITAL MARKETS OR THE ECONOMY GENERALLY. MANY OF THESE FACTORS ALSO APPLY TO ILPT AND ITS BUSINESS, OPERATIONS, LIQUIDITY AND FINANCIAL CONDITION, THE REALIZATION OF WHICH COULD MATERIALLY AND ADVERSELY AFFECT US, PARTICULARLY IF ILPT IS UNABLE TO MAKE DISTRIBUTIONS TO ITS SHAREHOLDERS, INCLUDING US. THE INFORMATION CONTAINED IN THE FORM S-4 AND IN OUR FILINGS WITH THE SEC INCLUDING UNDER THE CAPTION "RISK FACTORS" IN OUR PERIODIC REPORTS, OR INCORPORATED THEREIN, IDENTIFIES OTHER IMPORTANT FACTORS THAT COULD CAUSE DIFFERENCES FROM OUR FORWARD LOOKING STATEMENTS. OUR FILINGS WITH THE SEC ARE AVAILABLE ON THE SEC’S WEBSITE AT WWW.SEC.GOV. YOU SHOULD NOT PLACE UNDUE RELIANCE UPON OUR FORWARD LOOKING STATEMENTS. EXCEPT AS REQUIRED BY LAW, WE DO NOT INTEND TO UPDATE OR CHANGE ANY FORWARD LOOKING STATEMENTS AS A RESULT OF NEW INFORMATION, FUTURE EVENTS OR OTHERWISE. WARNING CONCERNING FORWARD LOOKING STATEMENTS (CONTINUED) LOOKING STATEMENTS CONCERNING FORWARD WARNING Select Income REIT 6 Supplemental Operating and Financial Data, September 30, 2018
CORPORATE INFORMATION 351, 401, 501 Elliott Avenue West, Seattle, WA Square Feet: 299,643 F5 Networks (Nasdaq: FFIV) Corporate Headquarters 7 7
COMPANY PROFILE The Company: SIR is a real estate investment trust, or REIT, that owns directly or indirectly through its subsidiaries, including its majority owned subsidiary, ILPT, properties that are primarily net leased to single tenants. As of September 30, 2018, our consolidated portfolio included 368 buildings, leasable land parcels and easements with approximately 45.8 million rentable square feet located in 36 states. SIR Corporate Headquarters: owned 99 of these buildings and leasable land parcels with approximately 16.5 million rentable square feet, which are primarily office buildings, and ILPT owned 269 of these buildings, leasable land parcels and easements with approximately 29.2 million rentable Two Newton Place square feet, including 226 buildings, leasable land parcels and easements with approximately 16.8 million rentable square feet which 255 Washington Street, Suite 300 are primarily leasable industrial and commercial lands located in Hawaii. ILPT was our wholly owned subsidiary until January 17, Newton, MA 02458-1634 2018, when it completed an initial public offering, or the ILPT IPO, of its common shares and became a publicly traded REIT. We (t) (617) 796-8303 COMPANY PROFILE COMPANY remain ILPT's largest shareholder and, as of the date hereof, we own 45.0 million, or approximately 69.2%, of ILPT's outstanding (f) (617) 796-8335 common shares. Pursuant to the Merger Agreement, we will, subject to the satisfaction of certain conditions, distribute all 45.0 million of the ILPT common shares that we own to our shareholders prior to the merger. We have been investment grade rated since 2014, Stock Exchange Listing: and we are included in the Russell 2000® Index and the MSCI US REIT Index. Nasdaq Management: Trading Symbol: SIR is managed by The RMR Group LLC, or RMR, the majority owned operating subsidiary of The RMR Group Inc. (Nasdaq: RMR). RMR is an alternative asset management company that was founded in 1986 to manage real estate companies and related businesses. Common Shares: SIR RMR primarily provides management services to five publicly traded equity REITs and three real estate related operating businesses. In addition to managing SIR, RMR manages Hospitality Properties Trust, a REIT that owns hotels and travel centers, Senior Housing Issuer Ratings: Properties Trust, a REIT that primarily owns healthcare, senior living and medical office buildings, Government Properties Income Trust, a REIT that primarily owns properties throughout the U.S. that are majority leased to the U.S. and state governments and office Moody’s: Baa3 properties in the metropolitan Washington, D.C. market area that are leased to government and private sector tenants, and ILPT, a Standard & Poor’s: BBB- REIT and our majority owned subsidiary that owns and leases industrial and logistics properties. RMR also provides management services to TravelCenters of America LLC, a publicly traded operator and franchisor of travel centers along the U.S. Interstate Highway System, convenience stores and restaurants, Five Star Senior Living Inc., a publicly traded operator of senior living communities, and Sonesta International Hotels Corporation, a privately owned operator and franchisor of hotels and cruise ships. RMR also advises a closed end fund that invests in publicly traded securities of real estate companies, a publicly traded mortgage REIT and private Key Data (as of September 30, 2018): commercial real estate debt funds through wholly owned SEC registered investment advisory subsidiaries, as well as manages a (dollars and sq. ft. in 000s) private, open end core plus fund focused on the acquisition, ownership and leasing of a diverse portfolio of office properties throughout the U.S. As of September 30, 2018, RMR had $30.1 billion of real estate assets under management and the combined RMR managed Total buildings (1) 368 companies had approximately $12 billion of annual revenues, over 1,700 properties and over 52,000 employees. We believe that being managed by RMR is a competitive advantage for SIR because of RMR’s depth of management and experience in the real estate Total sq. ft. 45,754 industry. We also believe RMR provides management services to us at costs that are lower than we would have to pay for similar Percent leased 95.8% quality services. Q3 2018 total revenues $ 121,881 Q3 2018 net income attributed to SIR $ 29,483 (1) Includes 226 buildings, leasable land parcels and easements with approximately 16.8 million square feet which are primarily Q3 2018 Normalized FFO attributed to SIR (2) $ 55,968 leasable industrial and commercial lands located in Hawaii which are owned by ILPT. (2) See page 31 for the calculation of FFO attributed to SIR and Normalized FFO attributed to SIR and a reconciliation of net income attributed to SIR determined in accordance with U.S. generally accepted accounting principles, or GAAP, to those amounts. Select Income REIT 8 Supplemental Operating and Financial Data, September 30, 2018
INVESTOR INFORMATION Board of Trustees Donna D. Fraiche William A. Lamkin Jeffrey P. Somers Independent Trustee Independent Trustee Independent Trustee David M. Blackman Adam D. Portnoy Managing Trustee Managing Trustee INVESTOR INFORMATION INVESTOR Senior Management David M. Blackman John C. Popeo President and Chief Executive Officer Chief Financial Officer and Treasurer Contact Information Investor Relations Inquiries Select Income REIT Financial inquiries should be directed to John C. Popeo, Two Newton Place Chief Financial Officer and Treasurer, at (617) 796-8303 255 Washington Street, Suite 300 or jpopeo@sirreit.com. Newton, MA 02458-1634 (t) (617) 796-8303 Investor and media inquiries should be directed to (e-mail) info@sirreit.com Olivia Snyder, Manager, Investor Relations, at (617) 796-8320 or osnyder@sirreit.com. Select Income REIT 9 Supplemental Operating and Financial Data, September 30, 2018
RESEARCH COVERAGE Equity Research Coverage Bank of America / Merrill Lynch Morgan Stanley James Feldman Vikram Malhotra (646) 855-5808 (212) 761-7064 james.feldman@baml.com vikram.malhotra@morganstanley.com RESEARCH COVERAGE B. Riley FBR RBC Capital Markets Bryan Maher Michael Carroll (646) 885-5423 (440) 715-2649 bmaher@fbr.com michael.carroll@rbccm.com JMP Securities Mitch Germain (212) 906-3546 mgermain@jmpsecurities.com Rating Agencies Moody’s Investors Service Standard & Poor’s Dilara Sukhov Michael Souers (212) 553-1438 (212) 438-2508 dilara.sukhov@moodys.com michael.souers@standardandpoors.com SIR is followed by the analysts and its credit is rated by the rating agencies listed above. Please note that any opinions, estimates or forecasts regarding SIR’s performance made by these analysts or agencies do not represent opinions, forecasts or predictions of SIR or its management. SIR does not by its reference above imply its endorsement of or concurrence with any information, conclusions or recommendations provided by any of these analysts or agencies. Select Income REIT 10 Supplemental Operating and Financial Data, September 30, 2018
FINANCIALS Two Commercial Place, Norfolk, VA Square Feet: 288,662 Tenant: ADP, LLC 11 11
KEY CONSOLIDATED FINANCIAL DATA (dollars in thousands, except per share data) As of and For the Three Months Ended 9/30/2018 6/30/2018 3/31/2018 12/31/2017 9/30/2017 Selected Balance Sheet Data: Total gross assets (1) $ 5,090,751 $ 5,038,130 $ 5,003,168 $ 5,617,279 $ 4,972,896 Total assets $ 4,721,499 $ 4,683,850 $ 4,669,009 $ 5,303,030 $ 4,677,395 Total liabilities $ 2,341,859 $ 2,288,219 $ 2,240,565 $ 3,311,211 $ 2,655,096 Total shareholders' equity $ 2,379,640 $ 2,395,631 $ 2,428,444 $ 1,991,819 $ 2,022,299 Selected Income Statement Data: Total revenues $ 121,881 $ 116,007 $ 120,629 $ 117,925 $ 118,014 Net income $ 35,080 $ 17,464 $ 37,679 $ 2,075 $ 31,442 Net income attributed to SIR $ 29,483 $ 11,699 $ 33,200 $ 2,075 $ 31,442 NOI (2) $ 94,549 $ 89,947 $ 93,559 $ 92,434 $ 91,876 Adjusted EBITDA (3) $ 87,928 $ 72,297 $ 85,982 $ 59,818 $ 85,695 FFO attributed to SIR (4) $ 68,279 $ 44,586 $ 66,395 $ 36,977 $ 66,155 Normalized FFO attributed to SIR (4) $ 55,968 $ 40,555 $ 56,045 $ 34,764 $ 60,677 Per Common Share Data: Net income attributed to SIR - basic and diluted $ 0.33 $ 0.13 $ 0.37 $ 0.02 $ 0.35 FFO attributed to SIR - basic and diluted (4) $ 0.76 $ 0.50 $ 0.74 $ 0.41 $ 0.74 KEY CONSOLIDATED FINANCIAL DATA FINANCIAL CONSOLIDATED KEY Normalized FFO attributed to SIR - basic and diluted (4) $ 0.63 $ 0.45 (6) $ 0.63 $ 0.39 $ 0.68 Dividends: Annualized dividends paid per share $ 2.04 $ 2.04 $ 2.04 $ 2.04 $ 2.04 Annualized dividend yield (at end of period) (5) 9.3% 9.1% 10.5% 8.1% 8.7% Normalized FFO payout ratio (4) 81.0% 113.3% (6) 81.0% 130.8% 75.0% (1) Total gross assets is total assets plus accumulated depreciation. (2) See page 25 for the calculation of NOI and page 26 for a reconciliation of net income determined in accordance with GAAP to that amount. (3) See page 30 for the calculation of Adjusted EBITDA and a reconciliation of net income determined in accordance with GAAP to that amount. Adjusted EBITDA for the three months ended December 31, 2017 includes business management incentive fee expense of $25,569. (4) See page 31 for the calculation of FFO attributed to SIR and Normalized FFO attributed to SIR and a reconciliation of net income attributed to SIR determined in accordance with GAAP to those amounts. Excluding business management incentive fee expense of $25,569 for the the three months ended December 31, 2017, Normalized FFO attributed to SIR per common share and the Normalized FFO payout ratio would have been $0.67 and 76.1%, respectively. (5) Annualized dividend yield is the annualized dividend paid during the period divided by the closing price of our common shares at the end of the period. (6) Excluding the non-cash write-off of straight line rents receivable of $10,626 recorded during the three months ended June 30, 2018, Normalized FFO attributed to SIR per common share and the Normalized FFO payout ratio would have been $0.57 and 89.5%, respectively. Select Income REIT 12 Supplemental Operating and Financial Data, September 30, 2018
CONDENSED CONSOLIDATED BALANCE SHEETS (dollars in thousands, except per share data) September 30, December 31, 2018 2017 ASSETS Real estate properties: Land $ 1,057,197 $ 1,041,767 Buildings and improvements 3,238,661 3,178,098 4,295,858 4,219,865 Accumulated depreciation (369,252) (314,249) 3,926,606 3,905,616 Properties held for sale 15,289 5,829 Acquired real estate leases, net 433,947 477,577 Cash and cash equivalents 25,982 658,719 Restricted cash 403 178 Rents receivable, including straight line rents of $121,770 and $122,010, respectively, net of allowance for doubtful accounts of $2,227 and $1,396, respectively 131,642 127,672 Deferred leasing costs, net 14,568 14,295 Other assets, net 173,062 113,144 Total assets $ 4,721,499 $ 5,303,030 LIABILITIES AND SHAREHOLDERS' EQUITY Unsecured revolving credit facility $ 108,000 $ — ILPT revolving credit facility 380,000 750,000 Unsecured term loan, net — 348,870 Senior unsecured notes, net 1,430,688 1,777,425 Mortgage notes payable, net 210,624 210,785 Accounts payable and other liabilities 92,626 101,352 Assumed real estate lease obligations, net 62,176 68,783 Rents collected in advance 21,626 15,644 Security deposits 9,370 8,346 Due to related persons 26,749 30,006 Total liabilities 2,341,859 3,311,211 Commitments and contingencies CONDENSED CONSOLIDATED BALANCE SHEETS CONDENSED CONSOLIDATED Shareholders' equity: Shareholders' equity attributable to SIR: Common shares of beneficial interest, $.01 par value: 125,000,000 shares authorized; 89,550,528 and 89,487,371 shares issued and outstanding, respectively 896 895 Additional paid in capital 2,312,724 2,180,896 Cumulative net income 634,849 508,213 Cumulative other comprehensive income 863 52,665 Cumulative common distributions (887,776) (750,850) Total shareholders' equity attributable to SIR 2,061,556 1,991,819 Noncontrolling interest in consolidated subsidiary 318,084 — Total shareholders' equity 2,379,640 1,991,819 Total liabilities and shareholders' equity $ 4,721,499 $ 5,303,030 Select Income REIT 13 Supplemental Operating and Financial Data, September 30, 2018
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (dollars and shares in thousands, except per share data) For the Three Months Ended September 30, For the Nine Months Ended September 30, 2018 2017 2018 2017 Revenues: Rental income $ 101,833 $ 98,635 $ 298,003 $ 293,020 Tenant reimbursements and other income 20,048 19,379 60,514 57,158 Total revenues 121,881 118,014 358,517 350,178 Expenses: Real estate taxes 12,518 11,489 36,748 33,168 Other operating expenses 14,814 14,649 43,714 41,039 Depreciation and amortization 35,371 34,713 105,326 102,770 Acquisition and transaction related costs 3,796 — 3,796 — General and administrative (1) 15,331 1,608 47,353 24,697 Write-off of straight line rents receivable, net (2) — — 10,626 12,517 Loss on asset impairment (2) — — — 4,047 Loss on impairment of real estate assets (3) 9,706 — 9,706 229 Total expenses 91,536 62,459 257,269 218,467 Operating income 30,345 55,555 101,248 131,711 Dividend income 397 397 1,190 1,190 Unrealized gain on equity securities (4) 22,771 — 53,159 — Interest income 133 19 753 39 Interest expense (including net amortization of debt issuance costs, premiums and discounts of $1,746, $1,716, $5,245 and $4,688, respectively) (23,287) (24,383) (69,446) (68,278) Loss on early extinguishment of debt — — (1,192) — Income before income tax expense, equity in earnings of an investee and gain on sale of real estate 30,359 31,588 85,712 64,662 Income tax expense (185) (177) (446) (364) Equity in earnings of an investee 831 31 882 533 Income before gain on sale of real estate 31,005 31,442 86,148 64,831 Gain on sale of real estate (5) 4,075 — 4,075 — Net income 35,080 31,442 90,223 64,831 Net income allocated to noncontrolling interest (5,597) — (15,841) — Net income attributed to SIR $ 29,483 $ 31,442 $ 74,382 $ 64,831 Weighted average common shares outstanding - basic 89,410 89,355 89,395 89,341 Weighted average common shares outstanding - diluted 89,437 89,379 89,411 89,364 Net income attributed to SIR per common share - basic and diluted $ 0.33 $ 0.35 $ 0.83 $ 0.73 CONDENSED CONSOLIDATED STATEMENTS OF INCOME STATEMENTS CONDENSED CONSOLIDATED Additional Data: General and administrative expenses (1) / total assets (at end of period) 0.3% —% 1.0% 0.5% Non-cash straight line rent adjustments included in rental income (6) $ 3,505 $ 5,581 $ 9,994 $ 16,361 Lease value amortization included in rental income (6) $ 556 $ 547 $ 1,615 $ 1,508 Lease termination fees included in rental income (6) $ 77 $ — $ 77 $ 101 Non-cash amortization included in other operating expenses (7) $ 74 $ 213 $ 362 $ 639 Non-cash amortization included in general and administrative expenses (7) $ 483 $ 345 $ 1,310 $ 1,034 See accompanying notes on the following page. Select Income REIT 14 Supplemental Operating and Financial Data, September 30, 2018
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (CONTINUED) (dollars in thousands, except per share data) (1) General and administrative expenses include estimated business management incentive fee expense of $6,664 and the reversal of previously accrued estimated business management incentive fees of $5,478 for the three months ended September 30, 2018 and 2017, respectively, and estimated business management incentive fee expense of $21,479 and $3,288 for the nine months ended September 30, 2018 and 2017, respectively. (2) In May 2018, one of our tenants defaulted on its lease for a property located in Naperville, IL with approximately 820,000 rentable square feet and an original lease expiration date of March 31, 2029. During the three months ended June 30, 2018, we recorded a non-cash charge of $10,626 to write off straight line rents receivable related to this lease. The lease with the tenant that defaulted was amended effective October 1, 2018. Under the terms of such lease amendment, the tenant paid amounts outstanding under the original lease for the period through September 30, 2018 and made a partial payment for unpaid real estate taxes. In addition, the tenant made a one time payment of $2,000 for deferred capital costs, and its first monthly payment of $250 to offset building expenses that were previously paid directly by the tenant but that are currently paid by us. The tenant assigned its subleases at the property to us and continues to occupy and pay rent on 147,045 square feet and has agreed to do so for 30 months from the date of the amendment. In March 2017, one of our tenants filed for bankruptcy and rejected two leases with us: (i) a lease for a property located in Huntsville, AL with approximately 1.4 million rentable square feet and an original lease term until August 2032 and (ii) a lease for a property in Hanover, PA with approximately 502,000 rentable square feet and an original lease term until September 2028. The Huntsville, AL property is occupied by a subtenant of our former tenant which is now contractually obligated to pay rent to us in an amount equal to the rent under the former tenant's lease for a term that runs concurrently with the former tenant’s original lease term, but is subject to certain tenant termination rights. We expect that the lost rents plus carrying costs, such as real estate taxes, insurance, security and other operating costs, from a fully vacant Hanover, PA property may total approximately $3,800 per year. The bankruptcy court overseeing this matter granted us permission to offset our damages with a $3,739 security deposit held from the bankrupt former tenant with respect to the Hanover, PA property. During the three months ended March 31, 2017, we recorded a non-cash charge of $12,517 to write off straight line rents receivable (net of the $3,739 security deposit) related to the rejected leases with the bankrupt former tenant at both properties plus an impairment charge of $4,047 related to the write-off of lease intangibles related to the property located in Hanover, PA. (3) During the three months ended September 30, 2018, we recorded a loss on impairment of real estate assets of $9,706 to reduce the carrying value of one property located in Hanover, PA to its estimated fair value less costs to sell. (4) Unrealized gain on equity securities represents the adjustment required to adjust the carrying value of our investment in RMR Inc. common stock to its fair value as of September 30, 2018 in accordance with new GAAP standards effective January 1, 2018. (5) During the three months ended September 30, 2018, we recorded a gain on sale of real estate of $4,075 in connection with the sale of a 100% owned land parcel in Kapolei, HI. (6) We report rental income on a straight line basis over the terms of the respective leases; accordingly, rental income includes non-cash straight line rent adjustments. Rental income also includes non-cash amortization of intangible lease assets and liabilities and lease termination fees, if any. (7) We recorded a liability for the amount by which the estimated fair value for accounting purposes exceeded the price we paid for our investment in RMR Inc. common stock in June 2015. This liability is being amortized on a straight line basis through December 31, 2035 as an allocated reduction to business management fees and property management fees expense, which are included in general and administrative and other operating expenses, respectively. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (CONTINUED) STATEMENTS CONDENSED CONSOLIDATED Select Income REIT 15 Supplemental Operating and Financial Data, September 30, 2018
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (dollars in thousands) For the Nine Months Ended September 30, 2018 2017 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 90,223 $ 64,831 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation 61,162 59,994 Net amortization of debt issuance costs, premiums and discounts 5,245 4,688 Amortization of acquired real estate leases and assumed real estate lease obligations 41,331 40,308 Amortization of deferred leasing costs 1,440 1,170 Write-off of straight line rents and provision for losses on rents receivable 11,509 12,856 Straight line rental income (9,994) (16,361) Impairment losses 9,706 4,276 Loss on early extinguishment of debt 1,192 — Gain on sale of real estate (4,075) — Other non-cash expenses, net 155 (453) Unrealized gain on equity securities (53,159) — Equity in earnings of an investee (882) (533) Change in assets and liabilities: Rents receivable (5,485) 1,563 Deferred leasing costs (1,677) (2,591) Other assets (1,285) (7,355) Accounts payable and other liabilities (8,208) (4,910) Rents collected in advance 5,982 1,312 Security deposits 1,024 263 Due to related persons (3,257) 3,706 Net cash provided by operating activities 140,947 162,764 CASH FLOWS FROM INVESTING ACTIVITIES: Real estate acquisitions and deposits (95,078) (117,458) Real estate improvements (16,630) (11,723) CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS STATEMENTS CONDENSED CONSOLIDATED Proceeds from sale of properties, net 9,394 — Net cash used in investing activities (102,314) (129,181) Select Income REIT 16 Supplemental Operating and Financial Data, September 30, 2018
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED) (dollars in thousands) For the Nine Months Ended September 30, 2018 2017 CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from issuance of common shares in subsidiary, net 444,309 — Proceeds from issuance of senior unsecured notes, after discounts — 345,394 Repayments of mortgage notes payable (54) (17,552) Borrowings under revolving credit facilities 342,000 220,000 Repayments of revolving credit facilities (604,000) (445,000) Payment of debt issuance costs (4,183) (3,197) Repayment of unsecured term loan (350,000) — Repayment of senior unsecured notes (350,000) — Distributions to common shareholders (136,926) (136,832) Repurchase of common shares (283) (309) Distributions to noncontrolling interest (12,008) — Net cash used in financing activities (671,145) (37,496) Decrease in cash, cash equivalents and restricted cash (632,512) (3,913) Cash, cash equivalents and restricted cash at beginning of period 658,897 22,171 Cash, cash equivalents and restricted cash at end of period $ 26,385 $ 18,258 SUPPLEMENTAL DISCLOSURES: Interest paid $ 76,142 $ 71,913 Income taxes paid $ 421 $ 373 SUPPLEMENTAL DISCLOSURE OF CASH, CASH EQUIVALENTS AND RESTRICTED CASH: The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheets to the amounts shown in the condensed consolidated statements of cash flows: As of September 30, 2018 2017 Cash and cash equivalents $ 25,982 $ 18,155 Restricted cash 403 103 Total cash, cash equivalents and restricted cash shown in the statements of cash flows $ 26,385 $ 18,258 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED) STATEMENTS CONDENSED CONSOLIDATED Select Income REIT 17 Supplemental Operating and Financial Data, September 30, 2018
FINANCIAL INFORMATION BY OWNER (dollars and sq. ft. in thousands) For the Three Months Ended September 30, 2018 (1) For the Nine Months Ended September 30, 2018 (1) SIR (excluding ILPT) ILPT Consolidated SIR (excluding ILPT) ILPT Consolidated REVENUES: Rental income $ 67,052 $ 34,781 $ 101,833 $ 194,533 $ 103,470 $ 298,003 Tenant reimbursements and other income 14,398 5,650 20,048 43,528 16,986 60,514 Total revenues 81,450 40,431 121,881 238,061 120,456 358,517 EXPENSES: Real estate taxes 7,576 4,942 12,518 22,639 14,109 36,748 Other operating expenses 11,533 3,281 14,814 34,064 9,650 43,714 Depreciation and amortization 28,219 7,152 35,371 84,411 20,915 105,326 Acquisition and transaction related costs 3,796 — 3,796 3,796 — 3,796 General and administrative 12,407 2,924 15,331 38,967 8,386 47,353 Write-off of straight line rents receivable, net — — — 10,626 — 10,626 Loss on impairment of real estate assets 9,706 — 9,706 9,706 — 9,706 Total expenses 73,237 18,299 91,536 204,209 53,060 257,269 Operating income 8,213 22,132 30,345 33,852 67,396 101,248 Dividend income 397 — 397 1,190 — 1,190 Unrealized gain on equity securities 22,771 — 22,771 53,159 — 53,159 Interest income 62 71 133 619 134 753 Interest expense (19,235) (4,052) (23,287) (58,040) (11,406) (69,446) FINANCIAL INFORMATION BY OWNER BY INFORMATION FINANCIAL Loss on early extinguishment of debt — — — (1,192) — (1,192) Income before income tax expense, equity in earnings of an investee and gain on sale of real estate 12,208 18,151 30,359 29,588 56,124 85,712 Income tax expense (176) (9) (185) (422) (24) (446) Equity in earnings of an investee 831 — 831 882 — 882 Income before gain on sale of real estate 12,863 18,142 31,005 30,048 56,100 86,148 Gain on sale of real estate 4,075 — 4,075 4,075 — 4,075 Net income 16,938 18,142 35,080 34,123 56,100 90,223 Net income allocated to noncontrolling interest (5,597) — (5,597) (15,841) — (15,841) Net income attributed to SIR $ 11,341 $ 18,142 $ 29,483 $ 18,282 $ 56,100 $ 74,382 As of September 30, 2018 (1) SIR (excluding ILPT) ILPT Consolidated Total Assets $ 3,214,870 $ 1,506,629 $ 4,721,499 Unsecured revolving credit facility $ 108,000 $ 380,000 $ 488,000 Senior unsecured notes, net 1,430,688 — 1,430,688 Mortgage notes payable, net 161,373 49,251 210,624 Total Debt $ 1,700,061 $ 429,251 $ 2,129,312 (1) In connection with ILPT's formation in September 2017, SIR contributed to ILPT substantially all of SIR's industrial and logistics properties located in Hawaii, totaling 226 buildings, leasable land parcels and easements, as well as 40 industrial and logistics buildings located in 24 other states (a combined 28,540 rentable square feet), and ILPT issued a $750,000 demand note and 45,000,000 of the common shares of ILPT to SIR. On January 17, 2018, ILPT completed the ILPT IPO and sold 20,000,000 of its common shares for net proceeds (after deducting the underwriting discount and commissions and expenses) of $444,309. ILPT used part of the net proceeds from the ILPT IPO towards the repayment of amounts outstanding under its revolving credit facility. ILPT also reimbursed us for approximately $7,271 of costs we incurred in connection with ILPT's formation and the preparation for the ILPT IPO. Select Income REIT 18 Supplemental Operating and Financial Data, September 30, 2018
CONSOLIDATED DEBT SUMMARY (dollars in thousands) Coupon Interest Principal Maturity Due at Years to Rate (1) Rate (2) Balance (3) Date Maturity Maturity As of September 30, 2018: Unsecured Floating Rate Debt: SIR revolving credit facility (LIBOR + 125 bps) (4) 3.335% 3.335% $ 108,000 3/29/2019 $ 108,000 0.5 ILPT revolving credit facility (LIBOR + 130 bps) (5) 3.504% 3.504% 380,000 12/29/2021 380,000 3.2 Subtotal / weighted average unsecured floating rate debt 3.467% 3.467% 488,000 488,000 2.6 Unsecured Fixed Rate Debt: Senior notes due 2020 3.600% 3.775% 400,000 2/1/2020 400,000 1.3 Senior notes due 2022 4.150% 4.360% 300,000 2/1/2022 300,000 3.3 Senior notes due 2024 4.250% 4.471% 350,000 5/15/2024 350,000 5.6 Senior notes due 2025 4.500% 4.755% 400,000 2/1/2025 400,000 6.3 Subtotal / weighted average unsecured fixed rate debt 4.119% 4.334% 1,450,000 1,450,000 4.1 CONSOLIDATED DEBT SUMMARY DEBT SUMMARY CONSOLIDATED Secured Fixed Rate Debt: One property (one building) in Philadelphia, PA (6) 4.114% 4.160% 40,946 8/3/2020 39,635 1.8 One property (one building) in Chester, VA (7) 3.990% 3.480% 48,750 11/1/2020 48,750 2.1 One property (three buildings) in Seattle, WA 3.550% 3.790% 71,000 5/1/2023 71,000 4.6 One property (one building) in Chicago, IL 3.700% 3.590% 50,000 6/1/2023 50,000 4.7 Subtotal / weighted average secured fixed rate debt 3.797% 3.743% 210,696 209,385 3.5 Total / weighted average debt 3.939% 4.079% $ 2,148,696 $ 2,147,385 3.7 See accompanying notes on the following page. Select Income REIT 19 Supplemental Operating and Financial Data, September 30, 2018
CONSOLIDATED DEBT SUMMARY (CONTINUED) (dollars in thousands) (1) Reflects the interest rate stated in, or determined pursuant to, the contract terms. (2) Includes the effect of interest rate protection and mark to market accounting for certain mortgages and discounts on senior unsecured notes. Excludes upfront transaction costs. (3) Principal balance excludes unamortized premiums, discounts and certain issuance costs related to these debts. Total debt outstanding as of September 30, 2018, net of unamortized premiums, discounts and certain issuance costs totaling $19,384, was $2,129,312. (4) We have a $750,000 revolving credit facility which has a maturity date of March 29, 2019, interest payable on borrowings of LIBOR plus 125 basis points and a facility fee of 25 basis points. Both the interest rate premium and the facility fee for our revolving credit facility are subject to adjustment based on changes to our credit ratings. Upon the payment of an extension fee and meeting other conditions, we have the option to extend the maturity date to March 29, 2020. Principal balance represents the amount outstanding under our $750,000 revolving credit facility at September 30, 2018. Interest rate is as of September 30, 2018 and excludes the 25 basis points facility fee. The maximum borrowing availability under our revolving credit facility may be increased to up to $1,850,000 in certain circumstances. (5) ILPT has a $750,000 revolving credit facility which has a maturity date of December 29, 2021, interest payable on borrowings of LIBOR plus a premium and a commitment fee of 15 basis points per annum as of September 30, 2018. The interest rate premium for ILPT's revolving credit facility is subject to adjustment based on changes to ILPT's leverage ratio, and the commitment fee is subject to adjustment based on the unused portion of ILPT's revolving credit facility. ILPT has the option to extend the maturity date of its revolving credit facility for two, six month periods, subject to payment of extension fees and satisfaction of other conditions. Principal balance represents the amount outstanding under ILPT's $750,000 revolving credit facility at September 30, 2018. Interest rate is as of September 30, 2018 and excludes the commitment fee. The maximum borrowing availability under ILPT's revolving credit facility may be increased to up to $1,500,000 in certain circumstances. (6) Interest is payable at a rate equal to LIBOR plus a premium. The interest charge has been fixed by a cash flow hedge which sets the interest rate at approximately 4.16% until August 3, 2020, which is the maturity date of the mortgage note. Coupon rate is as of September 30, 2018. (7) Represents a mortgage note secured by a property owned by ILPT. CONSOLIDATED DEBT SUMMARY (CONTINUED) DEBT SUMMARY CONSOLIDATED Select Income REIT 20 Supplemental Operating and Financial Data, September 30, 2018
CONSOLIDATED DEBT MATURITY SCHEDULE (dollars in thousands) Scheduled Principal Payments as of September 30, 2018 Unsecured Unsecured Secured Floating Fixed Fixed Period/Year Rate Debt Rate Debt Rate Debt Total (3) 10/1/2018 - 12/31/2018 $ — $ — $ 174 $ 174 2019 108,000 (1) — 710 108,710 2020 — 400,000 88,812 488,812 2021 380,000 (2) — — 380,000 2022 — 300,000 — 300,000 2023 — — 121,000 121,000 2024 — 350,000 — 350,000 2025 — 400,000 — 400,000 Total $ 488,000 $ 1,450,000 $ 210,696 $ 2,148,696 Percent 22.7% 67.5% 9.8% 100.0% CONSOLIDATED DEBT MATURITY SCHEDULE DEBT MATURITY CONSOLIDATED (1) Represents the amount outstanding under our $750,000 revolving credit facility at September 30, 2018. We have a $750,000 revolving credit facility which has a maturity date of March 29, 2019, interest payable on borrowings of LIBOR plus 125 basis points and a facility fee of 25 basis points. Both the interest rate premium and the facility fee for our revolving credit facility are subject to adjustment based on changes to our credit ratings. Upon the payment of an extension fee and meeting other conditions, we have the option to extend the maturity date to March 29, 2020. (2) Represents the amount outstanding under ILPT's $750,000 revolving credit facility at September 30, 2018. ILPT has a $750,000 revolving credit facility which has a maturity date of December 29, 2021, interest payable on borrowings of LIBOR plus a premium and a commitment fee of 15 basis points per annum as of September 30, 2018. The interest rate premium for ILPT's revolving credit facility is subject to adjustment based on changes to ILPT's leverage ratio, and the commitment fee is subject to adjustment based on the unused portion of ILPT's revolving credit facility. ILPT has the option to extend the maturity date of its revolving credit facility for two, six month periods, subject to payment of extension fees and satisfaction of other conditions. (3) Total debt outstanding as of September 30, 2018, net of unamortized premiums, discounts and certain issuance costs totaling $19,384, was $2,129,312. Select Income REIT 21 Supplemental Operating and Financial Data, September 30, 2018
CONSOLIDATED LEVERAGE RATIOS, COVERAGE RATIOS AND PUBLIC DEBT COVENANTS As of and For the Three Months Ended 9/30/2018 6/30/2018 3/31/2018 12/31/2017 9/30/2017 Leverage Ratios: Total debt (1) / total gross assets (2) 42.2% 41.7% 41.4% 55.4% 49.9% Total debt (1) / gross book value of real estate assets (3) 43.5% 42.7% 42.6% 64.0% 51.0% Total debt (1) / total market capitalization (4) 52.2% 51.1% 54.6% 58.0% 54.2% Secured debt (1) / total assets 4.5% 4.5% 4.5% 4.0% 4.9% Variable rate debt (1) / total debt (1) 22.7% 20.9% 19.8% 35.4% 18.2% Coverage Ratios: Adjusted EBITDA (5) / interest expense 3.8x 3.2x (8) 3.7x 2.4x 3.5x Total debt (1) / annualized Adjusted EBITDA (5) 6.1x 7.3x (8) 6.0x 13.0x 7.2x Public Debt Covenants: Total debt / adjusted total assets (6) (maximum 60%) 41.9% 41.4% 41.3% 55.4% 50.0% Secured debt / adjusted total assets (6) (maximum 40%) 4.1% 4.2% 4.2% 17.1% 4.6% Consolidated income available for debt service (7) / annual debt service (minimum 1.50x) 3.3x 3.6x 4.0x 3.4x 3.8x Total unencumbered assets (6) / unsecured debt (minimum 150%) 242.7% 245.6% 246.5% 178.9% 199.9% (1) Debt amounts represent the principal balance as of the date reported. (2) Total gross assets is total assets plus accumulated depreciation. (3) Gross book value of real estate assets is real estate properties at cost, plus certain acquisition costs, if any, before depreciation and purchase price allocations, less impairment writedowns, if any. (4) Total market capitalization is total debt plus the market value of our common shares at the end of each period. (5) See page 30 for the calculation of Adjusted EBITDA and for a reconciliation of net income determined in accordance with GAAP to that amount. (6) Adjusted total assets and total unencumbered assets include original cost of real estate assets calculated in accordance with GAAP and exclude depreciation and amortization, accounts receivable, other intangible assets and impairment writedowns, if any. (7) Consolidated income available for debt service is earnings from operations excluding interest expense, depreciation and amortization, loss on asset impairment, gains and losses on early extinguishment of debt, and gains and losses on sales of properties, if any, determined together with debt service on a pro forma basis for the four consecutive fiscal quarters most recently ended. (8) Excluding the non-cash write-off of straight line rents receivable of $10.6 million recorded during the three months ended June 30, 2018, the ratios of Adjusted EBITDA to interest expense and total debt to annualized Adjusted EBITDA would have been 3.7x and 6.3x, respectively. CONSOLIDATED LEVERAGE RATIOS, COVERAGE RATIOS AND PUBLIC DEBT COVENANTS COVERAGE RATIOS LEVERAGE RATIOS, CONSOLIDATED Select Income REIT 22 Supplemental Operating and Financial Data, September 30, 2018
CONSOLIDATED CAPITAL EXPENDITURES SUMMARY (dollars in thousands) For the Three Months Ended SIR (excluding ILPT): 9/30/2018 6/30/2018 3/31/2018 12/31/2017 9/30/2017 Tenant improvements (1) $ 3,318 $ 6,671 $ 1,734 $ — $ 376 Leasing costs (2) 211 308 571 3,160 308 Building improvements (3) 1,464 660 385 1,330 1,099 Recurring capital expenditures 4,993 7,639 2,690 4,490 1,783 Development, redevelopment and other activities (4) 950 1,067 72 462 655 Total capital expenditures $ 5,943 $ 8,706 $ 2,762 $ 4,952 $ 2,438 For the Three Months Ended ILPT: 9/30/2018 6/30/2018 3/31/2018 12/31/2017 9/30/2017 Tenant improvements (1) $ — $ — $ 69 $ 384 $ 2 Leasing costs (2) 188 324 5 80 95 Building improvements (3) 657 211 90 228 224 Recurring capital expenditures 845 535 164 692 321 Development, redevelopment and other activities (4) 110 78 378 634 1,928 Total capital expenditures $ 955 $ 613 $ 542 $ 1,326 $ 2,249 For the Three Months Ended Consolidated: 9/30/2018 6/30/2018 3/31/2018 12/31/2017 9/30/2017 Tenant improvements (1) $ 3,318 $ 6,671 $ 1,803 $ 384 $ 378 Leasing costs (2) 399 632 576 3,240 403 Building improvements (3) 2,121 871 475 1,558 1,323 CONSOLIDATED CAPITAL EXPENDITURES SUMMARY CAPITAL CONSOLIDATED Recurring capital expenditures 5,838 8,174 2,854 5,182 2,104 Development, redevelopment and other activities (4) 1,060 1,145 450 1,096 2,583 Total capital expenditures $ 6,898 $ 9,319 $ 3,304 $ 6,278 $ 4,687 (1) Tenant improvements include capital expenditures used to improve tenants' space or amounts paid directly to tenants to improve their space. (2) Leasing costs include leasing related costs, such as brokerage commissions, legal costs and tenant inducements. (3) Building improvements generally include (i) expenditures to replace obsolete building components and (ii) expenditures that extend the useful life of existing assets. (4) Development, redevelopment and other activities generally include (i) capital expenditures that are identified at the time of a property acquisition and incurred within a short time period after acquiring the property and (ii) capital expenditure projects that reposition a property or result in new sources of revenues. Select Income REIT 23 Supplemental Operating and Financial Data, September 30, 2018
CONSOLIDATED PROPERTY ACQUISITIONS AND DISPOSITIONS INFORMATION SINCE 1/1/18 (sq. ft. and dollars in thousands, except per sq. ft. data) Acquisitions (1): Weighted Average Purchase Remaining Date Number of Purchase Price (2) / Cap Lease Term Percent Acquired Location Buildings Owner Sq. Ft. Price (2) Sq. Ft. Rate (3) in Years (4) Leased (5) Tenant 6/27/2018 Doral, FL 1 ILPT 240 $ 43,075 $ 179 5.1% 10.0 100% Hellmann Worldwide Logistics, Inc. 9/20/2018 Carlisle, PA 1 ILPT 205 20,000 98 5.0% 6.5 100% TAP Worldwide, LLC 9/28/2018 Upper Marlboro, MD 1 ILPT 221 29,250 132 5.1% 12.3 100% LZB Manufacturing, Inc. 10/16/2018 Maple Grove, MN 1 ILPT 319 27,700 87 5.7% 6.3 100% Bunzl Minneapolis, LLC Total / Weighted Average 4 985 $ 120,025 $ 122 5.2% 9.1 100% (1) On October 10, 2018, ILPT acquired a land parcel adjacent to a property it owns located in Ankeny, IA for $450, excluding acquisition related costs. This land parcel will be used for a 194 square foot expansion for the existing tenant at such property. (2) Represents the gross purchase price, including assumed mortgage debt, if any, and excluding acquisition related costs and purchase price allocations. (3) Represents the ratio of (x) annual straight line rental income, excluding the impact of above and below market lease amortization, based on existing leases as of the date of acquisition, less estimated annual property operating expenses as of the date of acquisition, excluding depreciation and amortization expense, to (y) the acquisition purchase price, including the principal amount of any assumed debt and excluding acquisition related costs. (4) Average remaining lease term in years is weighted based on rental revenues as of the date acquired. (5) Percent leased is as of the date acquired. Dispositions: Date Number of Sale Sold Location Land Parcels Owner Sq. Ft. Price (1) 8/31/2018 Kapolei, HI 1 SIR 418 $ 10,300 (1) Represents the gross contract sales price, plus purchase price adjustments, if any, and excludes closing costs. CONSOLIDATED PROPERTY ACQUISITIONS AND DISPOSITIONS INFORMATION SINCE 1/1/18 AND DISPOSITIONS INFORMATION ACQUISITIONS PROPERTY CONSOLIDATED Select Income REIT 24 Supplemental Operating and Financial Data, September 30, 2018
CALCULATION AND RECONCILIATION OF PROPERTY NET OPERATING INCOME (NOI) AND CASH BASIS NOI (1) (dollars in thousands) For the Three Months Ended For the Nine Months Ended 9/30/2018 6/30/2018 3/31/2018 12/31/2017 9/30/2017 9/30/2018 9/30/2017 CASH BASIS NOI Calculation of NOI and Cash Basis NOI: Rental income $ 101,833 $ 96,415 $ 99,755 $ 99,265 $ 98,635 $ 298,003 $ 293,020 Tenant reimbursements and other income 20,048 19,592 20,874 18,660 19,379 60,514 57,158 Real estate taxes (12,518) (12,442) (11,788) (10,963) (11,489) (36,748) (33,168) Other operating expenses (14,814) (13,618) (15,282) (14,528) (14,649) (43,714) (41,039) NOI $ 94,549 $ 89,947 $ 93,559 $ 92,434 $ 91,876 $ 278,055 $ 275,971 SIR NOI (excluding ILPT) $ 62,341 $ 57,933 $ 61,084 $ 60,403 $ 60,116 $ 181,358 $ 180,277 ILPT NOI 32,208 32,014 32,475 32,031 31,760 96,697 95,694 NOI $ 94,549 $ 89,947 $ 93,559 $ 92,434 $ 91,876 $ 278,055 $ 275,971 Non-cash straight line rent adjustments included in rental income (2) (3,505) (2,933) (3,556) (4,608) (5,581) (9,994) (16,361) Lease value amortization included in rental income (2) (556) (545) (514) (546) (547) (1,615) (1,508) Lease termination fees included in rental income (2) (77) — — (212) — (77) (101) Non-cash amortization included in other operating expenses (3) (74) (75) (213) (213) (213) (362) (639) Cash Basis NOI $ 90,337 $ 86,394 $ 89,276 $ 86,855 $ 85,535 $ 266,007 $ 257,362 SIR Cash Basis NOI (excluding ILPT) $ 59,349 $ 55,519 $ 58,097 $ 56,573 $ 55,486 $ 172,965 $ 166,792 ILPT Cash Basis NOI 30,988 30,875 31,179 30,282 30,049 93,042 90,570 Cash Basis NOI $ 90,337 $ 86,394 $ 89,276 $ 86,855 $ 85,535 $ 266,007 $ 257,362 See accompanying notes on the following page. CALCULATION AND RECONCILIATION OF PROPERTY NET OPERATING INCOME (NOI) AND INCOME (NOI) NET OPERATING OF PROPERTY AND RECONCILIATION CALCULATION Select Income REIT 25 Supplemental Operating and Financial Data, September 30, 2018
CALCULATION AND RECONCILIATION OF PROPERTY NET OPERATING INCOME (NOI) AND CASH BASIS NOI (CONTINUED) (1) (dollars in thousands) For the Three Months Ended For the Nine Months Ended 9/30/2018 6/30/2018 3/31/2018 12/31/2017 9/30/2017 9/30/2018 9/30/2017 Reconciliation of Net Income to NOI and Cash Basis NOI: Net income $ 35,080 $ 17,464 $ 37,679 $ 2,075 $ 31,442 $ 90,223 $ 64,831 Gain on sale of real estate (5) (4,075) — — — — (4,075) — Income before gain on sale of real estate 31,005 17,464 37,679 2,075 31,442 86,148 64,831 Equity in earnings of an investee (831) (7) (44) (75) (31) (882) (533) Income tax expense 185 101 160 102 177 446 364 Income before income tax expense, equity in earnings of an investee and gain on sale of real estate 30,359 17,558 37,795 2,102 31,588 85,712 64,662 Loss on early extinguishment of debt — — 1,192 — — 1,192 — CASH BASIS NOI (CONTINUED) Interest expense 23,287 22,667 23,492 24,592 24,383 69,446 68,278 Interest income (133) (110) (510) (51) (19) (753) (39) Unrealized gain on equity securities (22,771) (13,488) (16,900) — — (53,159) — Dividend income (397) (396) (397) (397) (397) (1,190) (1,190) Operating income 30,345 26,231 44,672 26,246 55,555 101,248 131,711 Loss on impairment of real estate assets (6) 9,706 — — — — 9,706 229 Loss on asset impairment (4) — — — — — — 4,047 Write-off of straight line rents receivable, net (4) — 10,626 — — — 10,626 12,517 General and administrative 15,331 18,081 13,941 30,211 1,608 47,353 24,697 Acquisition and transaction related costs 3,796 — — 1,075 — 3,796 — Depreciation and amortization 35,371 35,009 34,946 34,902 34,713 105,326 102,770 NOI 94,549 89,947 93,559 92,434 91,876 278,055 275,971 Non-cash straight line rent adjustments included in rental income (2) (3,505) (2,933) (3,556) (4,608) (5,581) (9,994) (16,361) Lease value amortization included in rental income (2) (556) (545) (514) (546) (547) (1,615) (1,508) Lease termination fees included in rental income (2) (77) — — (212) — (77) (101) Non-cash amortization included in other operating expenses (3) (74) (75) (213) (213) (213) (362) (639) Cash Basis NOI $ 90,337 $ 86,394 $ 89,276 $ 86,855 $ 85,535 $ 266,007 $ 257,362 (1) See Definitions of Certain Non-GAAP Financial Measures on page 33 for the definitions of NOI and Cash Basis NOI, a description of why we believe they are appropriate supplemental measures and a description of how we use these measures. (2) We report rental income on a straight line basis over the terms of the respective leases; accordingly, rental income includes non-cash straight line rent adjustments. Rental income also includes non-cash amortization of intangible lease assets and liabilities and lease termination fees, if any. (3) We recorded a liability for the amount by which the estimated fair value for accounting purposes exceeded the price we paid for our investment in RMR Inc. common stock in June 2015. A portion of this liability is being amortized on a straight line basis through December 31, 2035 as a reduction to property management fees expense, which are included in other operating expenses. (4) During the three months ended June 30, 2018, we recorded a $10,626 non-cash write-off of straight line rents receivable as a result of a tenant default. During the three months ended March 31, 2017, we recorded a $12,517 non-cash write-off of straight line rents receivable related to leases associated with a tenant bankruptcy at two properties located in Huntsville, AL and Hanover, PA and a $4,047 loss on asset impairment for unamortized lease intangibles related to a lease associated with this tenant bankruptcy at the property located in Hanover, PA. See footnote (2) on page 15 for more information regarding these matters. (5) During the three months ended September 30, 2018, we recorded a gain on sale of real estate of $4,075 in connection with the sale of a 100% owned land parcel in Kapolei, HI. (6) During the three months ended September 30, 2018, we recorded a loss on impairment of real estate assets of $9,706 to reduce the carrying value of one property located in Hanover, PA to its estimated fair value less costs to sell. CALCULATION AND RECONCILIATION OF PROPERTY NET OPERATING INCOME (NOI) AND INCOME (NOI) NET OPERATING OF PROPERTY AND RECONCILIATION CALCULATION Select Income REIT 26 Supplemental Operating and Financial Data, September 30, 2018
RECONCILIATION OF NOI TO SAME PROPERTY NOI AND CALCULATION OF SAME PROPERTY CASH BASIS NOI (1) (dollars in thousands) For the Three Months Ended For the Nine Months Ended 9/30/2018 9/30/2017 9/30/2018 9/30/2017 Reconciliation of NOI to Same Property NOI (2)(3): CASH BASIS NOI Rental income $ 101,833 $ 98,635 $ 298,003 $ 293,020 Tenant reimbursements and other income 20,048 19,379 60,514 57,158 Real estate taxes (12,518) (11,489) (36,748) (33,168) Other operating expenses (14,814) (14,649) (43,714) (41,039) NOI 94,549 91,876 278,055 275,971 Less: NOI of properties not included in same property results (1,541) (767) (7,624) (3,226) Same property NOI $ 93,008 $ 91,109 $ 270,431 $ 272,745 SIR same property NOI (excluding ILPT) $ 61,379 $ 59,349 $ 174,337 $ 177,051 ILPT same property NOI 31,629 31,760 96,094 95,694 Same property NOI $ 93,008 $ 91,109 $ 270,431 $ 272,745 Calculation of Same Property Cash Basis NOI (2)(3): Same property NOI $ 93,008 $ 91,109 $ 270,431 $ 272,745 Less: Non-cash straight line rent adjustments included in rental income (4) (3,370) (5,515) (9,419) (14,696) Lease value amortization included in rental income (4) (556) (547) (1,615) (1,508) Lease termination fees included in rental income (4) (77) — (77) (101) Non-cash amortization included in other operating expenses (5) (73) (211) (358) (633) Same property Cash Basis NOI $ 88,932 $ 84,836 $ 258,962 $ 255,807 SIR same property Cash Basis NOI (excluding ILPT) $ 58,447 $ 54,787 $ 166,444 $ 165,237 ILPT same property Cash Basis NOI 30,485 30,049 92,518 90,570 Same property Cash Basis NOI $ 88,932 $ 84,836 $ 258,962 $ 255,807 (1) See Definitions of Certain Non-GAAP Financial Measures on page 33 for the definitions of NOI and Cash Basis NOI, a description of why we believe they are appropriate supplemental measures and a description of how we use these measures. (2) For the three months ended September 30, 2018 and 2017, same property NOI and Cash Basis NOI are based on properties that we owned as of September 30, 2018 and that we owned continuously since July 1, 2017. (3) For the nine months ended September 30, 2018 and 2017, same property NOI and Cash Basis NOI are based on properties that we owned as of September 30, 2018 and that we owned continuously since January 1, 2017. (4) We report rental income on a straight line basis over the terms of the respective leases; accordingly, rental income includes non-cash straight line rent adjustments. Rental income also includes non-cash amortization of intangible lease assets and liabilities and lease termination fees, if any. (5) We recorded a liability for the amount by which the estimated fair value for accounting purposes exceeded the price we paid for our investment in RMR Inc. common stock in June 2015. A portion of this liability is being amortized on a straight line basis through December 31, 2035 as a reduction to property management fees expense, which are included in other operating expenses. Select Income REIT 27 RECONCILIATION OF NOI TO SAME PROPERTY NOI AND CALCULATION OF SAME PROPERTY AND CALCULATION NOI SAME PROPERTY OF NOI TO RECONCILIATION Supplemental Operating and Financial Data, September 30, 2018
CALCULATION AND RECONCILIATION OF NOI, CASH BASIS NOI, SAME PROPERTY NOI AND SAME PROPERTY CASH BASIS NOI BY SEGMENT (1) (dollars in thousands) Three Months Ended September 30, 2018 Three Months Ended September 30, 2017 SIR (excluding SIR (excluding ILPT) ILPT Total ILPT) ILPT Total Calculation of NOI and Cash Basis NOI: Rental income $ 67,052 $ 34,781 $ 101,833 $ 65,011 $ 33,624 $ 98,635 Tenant reimbursements and other income 14,398 5,650 20,048 13,937 5,442 19,379 Real estate taxes (7,576) (4,942) (12,518) (6,910) (4,579) (11,489) Other operating expenses (11,533) (3,281) (14,814) (11,922) (2,727) (14,649) NOI 62,341 32,208 94,549 60,116 31,760 91,876 Less: Non-cash straight line rent adjustments included in rental income (2) (2,377) (1,128) (3,505) (4,105) (1,476) (5,581) Lease value amortization included in rental income (2) (464) (92) (556) (450) (97) (547) Lease termination fees included in rental income (2) (77) — (77) — — — Non-cash amortization included in other operating expenses (3) (74) — (74) (75) (138) (213) Cash Basis NOI $ 59,349 $ 30,988 $ 90,337 $ 55,486 $ 30,049 $ 85,535 Reconciliation of NOI to Same Property NOI (4): NOI $ 62,341 $ 32,208 $ 94,549 $ 60,116 $ 31,760 $ 91,876 SAME PROPERTY CASH BASIS NOI BY SEGMENT CASH BASIS NOI BY SAME PROPERTY Less: NOI of properties not included in same property results (962) (579) (1,541) (767) — (767) Same property NOI $ 61,379 $ 31,629 $ 93,008 $ 59,349 $ 31,760 $ 91,109 Reconciliation of Same Property NOI to Same Property Cash Basis NOI (4): Same property NOI $ 61,379 $ 31,629 $ 93,008 $ 59,349 $ 31,760 $ 91,109 Less: Non-cash straight line rent adjustments included in rental income (2) (2,318) (1,052) (3,370) (4,039) (1,476) (5,515) Lease value amortization included in rental income (2) (464) (92) (556) (450) (97) (547) Lease termination fees included in rental income (2) (77) — (77) — — — Non-cash amortization included in other operating expenses (3) (73) — (73) (73) (138) (211) Same property Cash Basis NOI $ 58,447 $ 30,485 $ 88,932 $ 54,787 $ 30,049 $ 84,836 (1) See Definitions of Certain Non-GAAP Financial Measures on page 33 for the definitions of NOI and Cash Basis NOI, a description of why we believe they are appropriate supplemental measures and a description of how we use these measures. (2) We report rental income on a straight line basis over the terms of the respective leases; accordingly, rental income includes non-cash straight line rent adjustments. Rental income also includes non-cash amortization of intangible lease assets and liabilities and lease termination fees, if any. (3) We recorded a liability for the amount by which the estimated fair value for accounting purposes exceeded the price we paid for our investment in RMR Inc. common stock in June 2015. A portion of this liability is being amortized on a straight line basis through December 31, 2035 as a reduction to property management fees expense, which are included in other operating expenses. (4) For the three months ended September 30, 2018 and 2017, same property NOI and same property Cash Basis NOI are based on properties that SIR owned as of September 30, 2018 and that it owned continuously since July 1, 2017. CALCULATION AND RECONCILIATION OF NOI, CASH BASIS NOI, SAME PROPERTY NOI AND NOI OF NOI, CASH BASIS SAME PROPERTY AND RECONCILIATION CALCULATION Select Income REIT 28 Supplemental Operating and Financial Data, September 30, 2018
CALCULATION AND RECONCILIATION OF NOI, CASH BASIS NOI, SAME PROPERTY NOI AND SAME PROPERTY CASH BASIS NOI BY SEGMENT (CONTINUED) (1) (dollars in thousands) Nine Months Ended September 30, 2018 Nine Months Ended September 30, 2017 SIR (excluding SIR (excluding ILPT) ILPT Total ILPT) ILPT Total Calculation of NOI and Cash Basis NOI: Rental income $ 194,533 $ 103,470 $ 298,003 $ 192,099 $ 100,921 $ 293,020 Tenant reimbursements and other income 43,528 16,986 60,514 40,968 16,190 57,158 Real estate taxes (22,639) (14,109) (36,748) (19,911) (13,257) (33,168) Other operating expenses (34,064) (9,650) (43,714) (32,879) (8,160) (41,039) NOI 181,358 96,697 278,055 180,277 95,694 275,971 Less: Non-cash straight line rent adjustments included in rental income (2) (6,634) (3,360) (9,994) (11,940) (4,421) (16,361) Lease value amortization included in rental income (2) (1,320) (295) (1,615) (1,219) (289) (1,508) Lease termination fees included in rental income (2) (77) — (77) (101) — (101) Non-cash amortization included in other operating expenses (3) (362) — (362) (225) (414) (639) Cash Basis NOI $ 172,965 $ 93,042 $ 266,007 $ 166,792 $ 90,570 $ 257,362 Reconciliation of NOI to Same Property NOI (4): NOI $ 181,358 $ 96,697 $ 278,055 $ 180,277 $ 95,694 $ 275,971 Less: NOI of properties not included in same property results (7,021) (603) (7,624) (3,226) — (3,226) Same property NOI $ 174,337 $ 96,094 $ 270,431 $ 177,051 $ 95,694 $ 272,745 Reconciliation of Same Property NOI to Same Property Cash Basis NOI (4): Same property NOI $ 174,337 $ 96,094 $ 270,431 $ 177,051 $ 95,694 $ 272,745 Less: SAME PROPERTY CASH BASIS NOI BY SEGMENT (CONTINUED) CASH BASIS NOI BY SAME PROPERTY Non-cash straight line rent adjustments included in rental income (2) (6,138) (3,281) (9,419) (10,275) (4,421) (14,696) Lease value amortization included in rental income (2) (1,320) (295) (1,615) (1,219) (289) (1,508) Lease termination fees included in rental income (2) (77) — (77) (101) — (101) Non-cash amortization included in other operating expenses (3) (358) — (358) (219) (414) (633) Same property Cash Basis NOI $ 166,444 $ 92,518 $ 258,962 $ 165,237 $ 90,570 $ 255,807 (1) See Definitions of Certain Non-GAAP Financial Measures on page 33 for the definitions of NOI and Cash Basis NOI, a description of why we believe they are appropriate supplemental measures and a description of how we use these measures. (2) We report rental income on a straight line basis over the terms of the respective leases; accordingly, rental income includes non-cash straight line rent adjustments. Rental income also includes non-cash amortization of intangible lease assets and liabilities and lease termination fees, if any. (3) We recorded a liability for the amount by which the estimated fair value for accounting purposes exceeded the price we paid for our investment in RMR Inc. common stock in June 2015. A portion of this liability is being amortized on a straight line basis through December 31, 2035 as a reduction to property management fees expense, which are included in other operating expenses. (4) For the nine months ended September 30, 2018 and 2017, same property NOI and same property Cash Basis NOI are based on properties that SIR owned as of September 30, 2018 and that it owned continuously since January 1, 2017. CALCULATION AND RECONCILIATION OF NOI, CASH BASIS NOI, SAME PROPERTY NOI AND NOI OF NOI, CASH BASIS SAME PROPERTY AND RECONCILIATION CALCULATION Select Income REIT 29 Supplemental Operating and Financial Data, September 30, 2018
CALCULATION OF EBITDA AND ADJUSTED EBITDA (1) (dollars in thousands) For the Three Months Ended For the Nine Months Ended 9/30/2018 6/30/2018 3/31/2018 12/31/2017 9/30/2017 9/30/2018 9/30/2017 Net income $ 35,080 $ 17,464 $ 37,679 $ 2,075 $ 31,442 $ 90,223 $ 64,831 Plus: interest expense 23,287 22,667 23,492 24,592 24,383 69,446 68,278 Plus: income tax expense 185 101 160 102 177 446 364 Plus: depreciation and amortization 35,371 35,009 34,946 34,902 34,713 105,326 102,770 EBITDA 93,923 75,241 96,277 61,671 90,715 265,441 236,243 Plus: acquisition and transaction related costs 3,796 — — 1,075 — 3,796 — Plus: general and administrative expense paid in common shares (2) 685 1,087 55 360 458 1,827 1,219 Plus: estimated business management incentive fees (3) 6,664 9,457 5,358 (3,288) (5,478) 21,479 3,288 Plus: loss on asset impairment (4) — — — — — — 4,047 Plus: loss on impairment of real estate assets (5) 9,706 — — — — 9,706 229 Plus: loss on early extinguishment of debt (6) — — 1,192 — — 1,192 — Less: unrealized gain on equity securities (7) (22,771) (13,488) (16,900) — — (53,159) — Less: gain on sale of real estate (4,075) — — — — (4,075) — Adjusted EBITDA $ 87,928 $ 72,297 (8) $ 85,982 $ 59,818 $ 85,695 $ 246,207 (8) $ 245,026 (8) (1) See Definitions of Certain Non-GAAP Financial Measures on page 33 for the definitions of EBITDA and Adjusted EBITDA and a description of why we believe they are appropriate supplemental measures. (2) Amount represents equity based compensation to our trustees and our officers and certain other employees of RMR LLC. (3) Incentive fees under our business management agreements with RMR LLC are payable after the end of each calendar year, are calculated based on common share total return, as defined, and are included in general and administrative expense in our condensed consolidated statements of income. In calculating net income in accordance with GAAP, we recognize estimated business management incentive fee expense, if any, in the first, second and third quarters. Although we recognize this expense, if any, in the first, second and third quarters for purposes of calculating net CALCULATION OF EBITDA AND ADJUSTED EBITDA AND OF EBITDA CALCULATION income, we do not include such expense in the calculation of Adjusted EBITDA until the fourth quarter, when the amount of the business management incentive fee expense for the calendar year, if any, is determined. Adjusted EBITDA for the three months ended December 31, 2017 includes business management incentive fee expense of $25,569. Business management incentive fees for 2017 were paid in cash in January 2018. (4) During the three months ended March 31, 2017, we recorded a loss on asset impairment of $4,047 for unamortized lease intangibles related to a lease associated with a tenant bankruptcy at a property located in Hanover, PA. (5) During the three months ended September 30, 2018, we recorded a loss on impairment of real estate assets of $9,706 to reduce the carrying value of one property located in Hanover, PA to its estimated fair value less costs to sell. During the three months ended June 30, 2017, we recorded losses on impairment of real estate assets of $229 in connection with one vacant property located in Maynard, MA. (6) During the three months ended March 31, 2018, we recorded a loss on early extinguishment of debt of $1,192 in connection with the repayment of our term loan and 2.85% senior unsecured notes. (7) Represents the unrealized gain to record our equity securities to fair value as of the end of the period in accordance with GAAP. (8) Excluding the non-cash write-off of straight line rents receivable of $10,626 recorded during the three months ended June 30, 2018 and the nine months ended September 30, 2018, and $12,517 recorded during the nine months ended September 30, 2017, Adjusted EBITDA for those periods would have been $82,923, $256,833 and $257,543, respectively. Select Income REIT 30 Supplemental Operating and Financial Data, September 30, 2018
CALCULATION OF FUNDS FROM OPERATIONS (FFO) ATTRIBUTED TO SIR AND NORMALIZED FFO ATTRIBUTED TO SIR (1) (amounts in thousands, except per share data) For the Three Months Ended For the Nine Months Ended 9/30/2018 6/30/2018 3/31/2018 12/31/2017 9/30/2017 9/30/2018 9/30/2017 Net income attributed to SIR $ 29,483 $ 11,699 $ 33,200 $ 2,075 $ 31,442 $ 74,382 $ 64,831 Plus: depreciation and amortization 35,371 35,009 34,946 34,902 34,713 105,326 102,770 Plus: loss on impairment of real estate assets 9,706 — — — — 9,706 229 FFO ATTRIBUTED TO SIR TO ATTRIBUTED FFO Plus: net income allocated to noncontrolling interest 5,597 5,765 4,479 — — 15,841 — Less: FFO allocated to noncontrolling interest (7,803) (7,887) (6,230) — — (21,920) — Less: gain on sale of real estate (4,075) — — — — (4,075) — FFO attributed to SIR 68,279 44,586 66,395 36,977 66,155 179,260 167,830 Plus: acquisition and transaction related costs 3,796 — — 1,075 — 3,796 — Plus: estimated business management incentive fees (2) 6,664 9,457 5,358 (3,288) (5,478) 21,479 3,288 Plus: loss on asset impairment (3) — — — — — — 4,047 Plus: loss on early extinguishment of debt (4) — — 1,192 — — 1,192 — Less: unrealized gain on equity securities (5) (22,771) (13,488) (16,900) — — (53,159) — Normalized FFO attributed to SIR $ 55,968 $ 40,555 $ 56,045 $ 34,764 $ 60,677 $ 152,568 $ 175,165 Weighted average common shares outstanding - basic 89,410 89,393 89,382 89,381 89,355 89,395 89,341 Weighted average common shares outstanding - diluted 89,437 89,416 89,390 89,392 89,379 89,411 89,364 Net income attributed to SIR per common share - basic and diluted $ 0.33 $ 0.13 $ 0.37 $ 0.02 $ 0.35 $ 0.83 $ 0.73 FFO attributed to SIR per common share - basic $ 0.76 $ 0.50 $ 0.74 $ 0.41 $ 0.74 $ 2.01 $ 1.88 FFO attributed to SIR per common share - diluted $ 0.76 $ 0.50 $ 0.74 $ 0.41 $ 0.74 $ 2.00 $ 1.88 Normalized FFO attributed to SIR per common share - basic and diluted $ 0.63 $ 0.45 (6) $ 0.63 $ 0.39 $ 0.68 $ 1.71 (6) $ 1.96 (6) See accompanying notes on the following page. Select Income REIT CALCULATION OF FUNDS FROM OPERATIONS (FFO) ATTRIBUTED TO SIR AND NORMALIZED SIR TO ATTRIBUTED (FFO) OF FUNDS FROM OPERATIONS CALCULATION 31 Supplemental Operating and Financial Data, September 30, 2018
CALCULATION OF FUNDS FROM OPERATIONS (FFO) ATTRIBUTED TO SIR AND NORMALIZED FFO ATTRIBUTED TO SIR (CONTINUED) (1) (1) See Definitions of Certain Non-GAAP Financial Measures on page 33 for a definition of FFO attributed to SIR and Normalized FFO attributed to SIR, a description of why we believe they are appropriate supplemental measures and a description of how we use these measures. (2) Incentive fees under our business management agreements with RMR LLC are payable after the end of each calendar year, are calculated based on common share total return, as defined, and are included in general and administrative expense in our condensed consolidated statements of income. In calculating net income in accordance with GAAP, we recognize estimated business management incentive fee expense, if any, in the first, second and third quarters. Although we recognize this expense, if any, in the first, second and third quarters for purposes of calculating net income, we do not include such expense in the calculation of Normalized FFO attributed to SIR until the fourth quarter, when the amount of the business management incentive fee expense for the calendar year, if any, is determined. Normalized FFO attributed to SIR for the three months ended December 31, 2017 includes business management incentive fee expense of $25,569. Business management incentive fees for 2017 were paid in cash in January 2018. (3) During the three months ended March 31, 2017, we recorded a loss on asset impairment of $4,047 for unamortized lease intangibles related to a lease associated with a tenant bankruptcy at a property located in Hanover, PA. (4) During the three months ended March 31, 2018, we recorded a loss on early extinguishment of debt of $1,192 in connection with the repayment of our term loan and 2.85% senior unsecured notes. (5) Represents the unrealized gain to record our equity securities to fair value as of the end of the period in accordance with GAAP. (6) Excluding the non-cash write-off of straight line rents receivable of $10,626 recorded during the three months ended June 30, 2018 and the nine months ended September 30, 2018, and $12,517 FFO ATTRIBUTED TO SIR (CONTINUED) TO ATTRIBUTED FFO recorded during the nine months ended September 30, 2017, Normalized FFO attributed to SIR per common share for those periods would have been $0.57, $1.83 and $2.10, respectively. Select Income REIT CALCULATION OF FUNDS FROM OPERATIONS (FFO) ATTRIBUTED TO SIR AND NORMALIZED SIR TO ATTRIBUTED (FFO) OF FUNDS FROM OPERATIONS CALCULATION 32 Supplemental Operating and Financial Data, September 30, 2018
DEFINITIONS OF CERTAIN NON-GAAP FINANCIAL MEASURES NOI and Cash Basis NOI: The calculations of NOI and Cash Basis NOI exclude certain components of net income in order to provide results that are more closely related to our property level results of operations. We calculate NOI and Cash Basis NOI as shown on pages 25 and 26. We define NOI as income from our rental of real estate less our property operating expenses. NOI excludes amortization of capitalized tenant improvement costs and leasing commissions that we record as depreciation and amortization. We define Cash Basis NOI as NOI excluding non-cash straight line rent adjustments, lease value amortization, lease termination fees, if any, and non-cash amortization included in other operating expenses. We consider NOI and Cash Basis NOI to be appropriate supplemental measures to net income because they may help both investors and management to understand the operations of our properties. We use NOI and Cash Basis NOI to evaluate individual and company wide property level performance, and we believe that NOI and Cash Basis NOI provide useful information to investors regarding our results of operations because they reflect only those income and expense items that are generated and incurred at the property level and may facilitate comparisons of our operating performance between periods and with other REITs. NOI and Cash Basis NOI do not represent cash generated by operating activities in accordance with GAAP and should not be considered alternatives to net income, net income attributed to SIR or operating income as indicators of our operating performance or as measures of our liquidity. These measures should be considered in conjunction with net income, net income attributed to SIR and operating income as presented in our condensed consolidated statements of income. Other real estate companies and REITs may calculate NOI and Cash Basis NOI differently than we do. EBITDA and Adjusted EBITDA: We calculate EBITDA and Adjusted EBITDA as shown on page 30. We consider EBITDA and Adjusted EBITDA to be appropriate supplemental measures of our operating performance, along with net income, net income attributed to SIR and operating income. We believe that EBITDA and Adjusted EBITDA provide useful information to investors because by excluding the effects of certain historical amounts, such as interest, depreciation and amortization expense, EBITDA and Adjusted EBITDA may facilitate a comparison of current operating performance with our past operating performance. EBITDA and Adjusted EBITDA do not represent cash generated by operating activities in accordance with GAAP and should not be considered alternatives to net income, net income attributed to SIR or operating income as indicators of operating performance or as measures of our liquidity. These measures should be considered in conjunction with net income, net income attributed to SIR and operating income as presented in our condensed consolidated statements of income. Other real estate companies and REITs may calculate EBITDA and Adjusted EBITDA differently than we do. FFO Attributed to SIR and Normalized FFO Attributed to SIR: We calculate FFO attributed to SIR and Normalized FFO attributed to SIR as shown on page 31. FFO attributed to SIR is calculated on the basis defined by The National Association of Real Estate Investment Trusts, or Nareit, which is net income, calculated in accordance with GAAP, plus real estate depreciation and amortization, loss on impairment of real estate assets and the difference between net income and FFO allocated to noncontrolling interest, but excluding gain on sale of real estate, as well as certain other adjustments currently not applicable to us. Our calculation of Normalized FFO attributed to SIR differs from Nareit’s definition of FFO because we include business management incentive fees, if any, only in the fourth quarter versus the quarter when they are recognized as expense in accordance with GAAP due to their quarterly volatility not necessarily being indicative of our core operating performance and the uncertainty as to whether any such business management incentive fees will be payable when all contingencies for determining such fees are known at the end of the calendar year and we exclude acquisition and transaction related costs expensed under GAAP, loss on asset impairment, loss on early extinguishment of debt, unrealized gain on equity securities and Normalized FFO, net of FFO, from noncontrolling interest, if any. We consider FFO attributed to SIR and Normalized FFO attributed to SIR to be appropriate supplemental measures of operating performance for a REIT, along with net income, net income attributed to a REIT and operating income. We believe that FFO attributed to SIR and Normalized FFO attributed to SIR provide useful information to investors because by excluding the effects of certain historical amounts, such as depreciation expense, FFO attributed to SIR and Normalized FFO attributed to SIR may facilitate a comparison of our operating performance between periods and with other REITs. FFO attributed to SIR and Normalized FFO attributed to SIR are among the factors considered by our Board of Trustees when determining the amount of distributions to our shareholders. Other factors include, but are not limited to, requirements to maintain our qualification for taxation as a REIT, limitations in our credit agreement and public debt covenants, the availability to us of debt and equity capital, our expectation of our future capital requirements and operating performance, our receipt of distributions from ILPT and our DEFINITIONS OF CERTAIN NON-GAAP FINANCIAL MEASURES FINANCIAL NON-GAAP DEFINITIONS OF CERTAIN expected needs for and availability of cash to pay our obligations. FFO attributed to SIR and Normalized FFO attributed to SIR do not represent cash generated by operating activities in accordance with GAAP and should not be considered alternatives to net income, net income attributed to SIR or operating income as indicators of our operating performance or as measures of our liquidity. These measures should be considered in conjunction with net income, net income attributed to SIR and operating income as presented in our condensed consolidated statements of income. Other real estate companies and REITs may calculate FFO and Normalized FFO differently than we do. Select Income REIT 33 Supplemental Operating and Financial Data, September 30, 2018
PORTFOLIO INFORMATION 7958 South Chester Street, Centennial, CO Square Feet: 167,917 United Launch Alliance Corporate Headquarters 34 34
CONSOLIDATED PORTFOLIO SUMMARY BY OWNER (dollars and sq. ft. in thousands) As of and For the Three Months Ended September 30, 2018 Key Statistic Consolidated ILPT SIR (excluding ILPT) Leasable buildings (1) 368 269 99 Percent of total 100.0% 73.1% 26.9% Total square feet 45,754 29,216 16,538 Percent of total 100.0% 63.9% 36.1% Leased square feet 43,845 29,002 14,843 Percent leased 95.8% 99.3% 89.8% Total revenues $ 121,881 $ 40,431 $ 81,450 Percent of total 100.0% 33.2% 66.8% NOI (2) $ 94,549 $ 32,208 $ 62,341 Percent of total 100.0% 34.1% 65.9% Cash Basis NOI (2) $ 90,337 $ 30,988 $ 59,349 Percent of total 100.0% 34.3% 65.7% CONSOLIDATED PORTFOLIO SUMMARY BY OWNER BY PORTFOLIO SUMMARY CONSOLIDATED (1) Includes buildings, leasable land parcels and easements which are primarily leasable industrial and commercial lands located in Hawaii, 226 of which are owned by ILPT. (2) See page 25 for the calculation of NOI and Cash Basis NOI, page 26 for a reconciliation of net income determined in accordance with GAAP to those amounts, page 27 for the reconciliation of NOI to same property NOI and calculation of same property Cash Basis NOI and page 28 for the calculation and reconciliation of NOI, Cash Basis NOI, same property NOI and same property Cash Basis NOI by segment. Select Income REIT 35 Supplemental Operating and Financial Data, September 30, 2018
CONSOLIDATED SAME PROPERTY RESULTS OF OPERATIONS (dollars and sq. ft. in thousands) As of and For the Three Months Ended (1) As of and For the Nine Months Ended (2) 9/30/2018 9/30/2017 9/30/2018 9/30/2017 Leasable Buildings: SIR (excluding ILPT) 97 97 95 95 ILPT (3) 266 266 266 266 Total 363 363 361 361 Square Feet (4): SIR (excluding ILPT) 16,263 16,263 15,890 15,890 ILPT (3) 28,550 28,540 28,550 28,540 Total 44,813 44,803 44,440 44,430 Percent Leased (5): SIR (excluding ILPT) 89.6% 92.0% 89.3% 91.8% ILPT 99.2% 99.9% 99.2% 99.9% Total 95.7% 97.0% 95.7% 97.0% Total Revenues: SIR (excluding ILPT) $ 80,375 $ 78,040 $ 227,893 $ 228,357 ILPT 39,827 39,066 119,826 117,111 Total $ 120,202 $ 117,106 $ 347,719 $ 345,468 CONSOLIDATED SAME PROPERTY RESULTS OF OPERATIONS RESULTS SAME PROPERTY CONSOLIDATED (1) Consists of properties that we owned continuously since July 1, 2017. (2) Consists of properties that we owned continuously since January 1, 2017. (3) Includes 226 buildings, leasable land parcels and easements with approximately 16,834 square feet which are primarily leasable industrial and commercial lands located in Hawaii. (4) Subject to modest adjustments when space is re-measured or re-configured for new tenants and when land leases are converted to building leases. (5) Includes (i) space being fitted out for occupancy pursuant to existing leases, if any, and (ii) space which is leased but is not occupied or is being offered for sublease by tenants, if any. Select Income REIT 36 Supplemental Operating and Financial Data, September 30, 2018
CONSOLIDATED SAME PROPERTY RESULTS OF OPERATIONS (CONTINUED) (dollars in thousands) As of and For the Three Months Ended (1) As of and For the Nine Months Ended (2) 9/30/2018 9/30/2017 9/30/2018 9/30/2017 NOI (3): SIR (excluding ILPT) $ 61,379 $ 59,349 $ 174,337 $ 177,051 ILPT 31,629 31,760 96,094 95,694 Total $ 93,008 $ 91,109 $ 270,431 $ 272,745 Cash Basis NOI (3): SIR (excluding ILPT) $ 58,447 $ 54,787 $ 166,444 $ 165,237 ILPT 30,485 30,049 92,518 90,570 Total $ 88,932 $ 84,836 $ 258,962 $ 255,807 NOI % Change: SIR (excluding ILPT) 3.4% -1.5% ILPT -0.4% 0.4% Total 2.1% -0.8% Cash Basis NOI % Change: SIR (excluding ILPT) 6.7% 0.7% ILPT 1.5% 2.2% Total 4.8% 1.2% (1) Consists of properties that we owned continuously since July 1, 2017. (2) Consists of properties that we owned continuously since January 1, 2017. (3) See page 25 for the calculation of NOI and Cash Basis NOI, page 26 for a reconciliation of net income determined in accordance with GAAP to those amounts, page 27 for the reconciliation of NOI to same property NOI and calculation of same property Cash Basis NOI and page 28 for the calculation and reconciliation of NOI, Cash Basis NOI, same property NOI and same property Cash Basis NOI by segment. CONSOLIDATED SAME PROPERTY RESULTS OF OPERATIONS (CONTINUED) OF OPERATIONS RESULTS SAME PROPERTY CONSOLIDATED Select Income REIT 37 Supplemental Operating and Financial Data, September 30, 2018
CONSOLIDATED LEASING SUMMARY (dollars and sq. ft. in thousands, except per sq. ft. data) As of and For the Three Months Ended 9/30/2018 6/30/2018 3/31/2018 12/31/2017 9/30/2017 Leasable buildings (1) 368 367 366 366 366 Total sq. ft. (2) 45,754 45,736 45,496 45,496 45,496 Square feet leased 43,845 43,359 43,580 43,767 43,753 Percentage leased 95.8% 94.8% 95.8% 96.2% 96.2% Leasing Activity (Sq. Ft.): New leases 120 55 1 173 114 Renewals 276 165 350 395 152 Total 396 220 351 568 266 % Change in GAAP Rent (3): New leases -15.3% 46.7% 19.6% 13.6% -11.0% Renewals 32.3% 25.0% 34.1% 24.6% 4.9% Weighted average (by square feet) 21.3% 33.9% 33.9% 21.1% 0.5% Leasing Costs and Concession Commitments (4): New leases $ 321 $ 484 $ 33 $ 7,667 $ 171 Renewals 268 57 370 6,237 299 Total $ 589 $ 541 $ 403 $ 13,904 $ 470 CONSOLIDATED LEASING SUMMARY CONSOLIDATED Leasing Costs and Concession Commitments per Sq. Ft. (4): New leases $ 2.68 $ 8.80 $ 33.00 $ 44.32 $ 1.50 Renewals $ 0.97 $ 0.35 $ 1.06 $ 15.79 $ 1.97 Total $ 1.49 $ 2.46 $ 1.15 $ 24.48 $ 1.77 Weighted Average Lease Term by Sq. Ft. (Years): New leases 4.4 21.1 7.0 8.4 10.1 Renewals 13.9 7.7 26.2 5.2 7.9 Total 11.0 11.0 26.1 6.2 8.9 Leasing Costs and Concession Commitments per Sq. Ft. per Year (4) (5): New leases $ 0.61 $ 0.42 $ 4.71 $ 5.28 $ 0.15 Renewals $ 0.07 $ 0.05 $ 0.04 $ 3.04 $ 0.25 Total $ 0.13 $ 0.22 $ 0.04 $ 3.95 $ 0.20 (1) Includes 226 buildings, leasable land parcels and easements with approximately 16,834 square feet which are primarily leasable industrial and commercial lands located in Hawaii which are owned by ILPT. (2) Subject to modest adjustments when space is re-measured or re-configured for new tenants and when land leases are converted to building leases. (3) Percent difference in prior rents charged for same space. Rents include estimated recurring expense reimbursements and exclude lease value amortization. (4) Includes commitments made for leasing expenditures and concessions, such as tenant improvements, leasing commissions, tenant reimbursements and free rent. (5) Amounts are per square foot per year for the weighted average lease term by leased square feet. The above leasing summary is based on leases entered into during the periods indicated. Select Income REIT 38 Supplemental Operating and Financial Data, September 30, 2018
SIR (EXCLUDING ILPT) LEASING SUMMARY (dollars and sq. ft. in thousands, except per sq. ft. data) As of and For the Three Months Ended 9/30/2018 6/30/2018 3/31/2018 12/31/2017 9/30/2017 Leasable buildings 99 100 100 100 100 Total sq. ft. (1) 16,538 16,956 16,956 16,956 16,956 Square feet leased 14,843 14,843 15,046 15,234 15,234 Percentage leased 89.8% 87.5% 88.7% 89.8% 89.8% Leasing Activity (Sq. Ft.): New leases 0 0 0 113 0 Renewals 72 2 55 287 17 Total 72 2 55 400 17 % Change in GAAP Rent (2): New leases 0.0% 0.0% 0.0% 12.9% 0.0% Renewals 39.8% 14.9% 10.7% 25.7% 3.5% Weighted average (by square feet) 39.8% 14.9% 10.7% 21.9% 3.5% Leasing Costs and Concession Commitments (3): New leases $ 0 $ 0 $ 0 $ 7,519 $ 0 Renewals 191 2 335 6,229 283 Total $ 191 $ 2 $ 335 $ 13,748 $ 283 Leasing Costs and Concession Commitments per Sq. Ft. (3): New leases $ 0.00 $ 0.00 $ 0.00 $ 66.54 $ 0.00 Renewals $ 2.65 $ 1.00 $ 6.09 $ 21.70 $ 16.65 SIR (EXCLUDING ILPT) LEASING SUMMARY Total $ 2.65 $ 1.00 $ 6.09 $ 34.37 $ 16.65 Weighted Average Lease Term by Sq. Ft. (Years): New leases 0.0 0.0 0.0 11.0 0.0 Renewals 7.6 5.7 4.0 4.9 5.0 Total 7.6 5.7 4.0 6.6 5.0 Leasing Costs and Concession Commitments per Sq. Ft. per Year (3) (4): New leases $ 0.00 $ 0.00 $ 0.00 $ 6.05 $ 0.00 Renewals $ 0.35 $ 0.18 $ 1.52 $ 4.43 $ 3.33 Total $ 0.35 $ 0.18 $ 1.52 $ 5.21 $ 3.33 (1) Subject to modest adjustments when space is re-measured or re-configured for new tenants and when land leases are converted to building leases. (2) Percent difference in prior rents charged for same space. Rents include estimated recurring expense reimbursements and exclude lease value amortization. (3) Includes commitments made for leasing expenditures and concessions, such as tenant improvements, leasing commissions, tenant reimbursements and free rent. (4) Amounts are per square foot per year for the weighted average lease term by leased square feet. The above leasing summary is based on leases entered into during the periods indicated. Select Income REIT 39 Supplemental Operating and Financial Data, September 30, 2018
ILPT LEASING SUMMARY (dollars and sq. ft. in thousands, except per sq. ft. data) As of and For the Three Months Ended 9/30/2018 6/30/2018 3/31/2018 12/31/2017 9/30/2017 Leasable buildings (1) 269 267 266 266 266 Total sq. ft. (2) 29,216 28,780 28,540 28,540 28,540 Square feet leased 29,002 28,516 28,534 28,533 28,519 Percentage leased 99.3% 99.1% 99.9% 99.9% 99.9% Leasing Activity (Sq. Ft.): New leases 120 55 1 60 114 Renewals 204 163 295 108 135 Total 324 218 296 168 249 (3) ILPT LEASING SUMMARY % Change in GAAP Rent : New leases -15.3% 46.7% 19.6% 17.8% -11.0% Renewals 26.6% 25.5% 46.3% 8.9% 5.7% Weighted average (by square feet) 12.1% 34.5% 45.9% 13.3% -0.5% Leasing Costs and Concession Commitments (4): New leases $ 321 $ 484 $ 33 $ 148 $ 171 Renewals 77 56 35 8 16 Total $ 398 $ 540 $ 68 $ 156 $ 187 Leasing Costs and Concession Commitments per Sq. Ft. (4): New leases $ 2.68 $ 8.80 $ 33.00 $ 2.47 $ 1.50 Renewals $ 0.38 $ 0.34 $ 0.12 $ 0.07 $ 0.12 Total $ 1.23 $ 2.48 $ 0.23 $ 0.93 $ 0.75 Weighted Average Lease Term by Sq. Ft. (Years): New leases 4.4 21.1 7.0 3.6 10.1 Renewals 16.1 7.7 30.4 6.0 8.3 Total 11.8 11.1 30.3 5.1 9.1 Leasing Costs and Concession Commitments per Sq. Ft. per Year (4) (5): New leases $ 0.61 $ 0.42 $ 4.71 $ 0.69 $ 0.15 Renewals $ 0.02 $ 0.04 $ 0.00 $ 0.01 $ 0.01 Total $ 0.10 $ 0.22 $ 0.01 $ 0.18 $ 0.08 (1) Includes 226 buildings, leasable land parcels and easements with approximately 16,834 square feet which are primarily leasable industrial and commercial lands located in Hawaii. (2) Subject to modest adjustments when space is re-measured or re-configured for new tenants and when land leases are converted to building leases. (3) Percent difference in prior rents charged for same space. Rents include estimated recurring expense reimbursements and exclude lease value amortization. (4) Includes commitments made for leasing expenditures and concessions, such as tenant improvements, leasing commissions, tenant reimbursements and free rent. (5) Amounts are per square foot per year for the weighted average lease term by leased square feet. The above leasing summary is based on leases entered into during the periods indicated. Select Income REIT 40 Supplemental Operating and Financial Data, September 30, 2018
CONSOLIDATED OCCUPANCY AND LEASING ANALYSIS BY OWNER (sq. ft. in thousands) Total Sq. Ft. (1) Sq. Ft. Leases Executed During As of the Three Months Ended 9/30/2018 Owner 9/30/2018 New Renewals Total SIR (excluding ILPT) 16,538 — 72 72 ILPT 29,216 120 204 324 Total 45,754 120 276 396 Sq. Ft. Leased As of 6/30/2018 New and Acquisitions / As of 9/30/2018 Owner 6/30/2018 % Leased (2) Expired Renewals (Sales) 9/30/2018 % Leased SIR (excluding ILPT) 14,843 87.5% (72) 72 — 14,843 89.8% ILPT 28,516 99.1% (264) 324 426 29,002 99.3% Total 43,359 94.8% (336) 396 426 43,845 95.8% (1) Subject to modest adjustments when space is re-measured or re-configured for new tenants and when land leases are converted to building leases. CONSOLIDATED OCCUPANCY AND LEASING ANALYSIS BY OWNER BY ANALYSIS AND LEASING OCCUPANCY CONSOLIDATED (2) Excludes effects of space remeasurements during the period, if any. Percent leased includes (i) space being fitted out for occupancy, if any, and (ii) space which is leased but is not occupied or is being offered for sublease by tenants, if any. Select Income REIT 41 Supplemental Operating and Financial Data, September 30, 2018
CONSOLIDATED TENANT DIVERSITY AND CREDIT CHARACTERISTICS As of September 30, 2018 % of Total Annualized Rental Revenues (1) % of Annualized Technology & Rental Revenues (1) Communications SIR (excluding Retail & Food Tenant Industry ILPT) ILPT Total 5.1% 9.2% Real Estate & Technology & Communications 31.7% 2.8% 21.8% 21.8% Financial Retail & Food 11.8% 31.6% 18.6% 9.8% Manufacturing & Real Estate & Financial 14.0% 9.5% 12.5% Transportation 10.8% Manufacturing & Transportation 8.9% 18.4% 12.2% 18.6% Legal & Consulting Legal & Consulting 15.9% 1.1% 10.8% 12.2% 12.5% Industrial 0.2% 28.1% 9.8% Industrial Energy Services 11.8% 4.4% 9.2% Energy Services Other 5.7% 4.1% 5.1% Other 100.0% 100.0% 100.0% % of Total Annualized Rental Revenues (1) % of Annualized Rental Revenues (1) SIR 16.1% (excluding Leased Hawaii lands (2) Tenant Credit Characteristics ILPT) ILPT Total Investment grade rated (2) 45.2% Leased Hawaii lands —% 46.8% 16.1% (3) Investment grade rated 46.4% 24.0% 38.7% (3) 38.7% Unrated or non- Unrated or non-investment grade 53.6% 29.2% 45.2% investment grade 100.0% 100.0% 100.0% (1) We define annualized rental revenues as the annualized contractual rents, as of September 30, 2018, including straight line rent adjustments and excluding lease value amortization, adjusted for tenant concessions including free rent and amounts reimbursed to tenants, plus estimated recurring expense reimbursements from tenants. (2) Excludes certain Hawaii lands which are leased by investment grade rated tenants and are included in the investment grade rated tenant credit category. (3) Includes certain Hawaii lands which are leased by investment grade rated tenants. CONSOLIDATED TENANT DIVERSITY AND CREDIT CHARACTERISTICS TENANT DIVERSITY CONSOLIDATED Select Income REIT 42 Supplemental Operating and Financial Data, September 30, 2018
TENANTS REPRESENTING 1% OR MORE OF TOTAL CONSOLIDATED ANNUALIZED RENTAL REVENUES As of September 30, 2018 (sq. ft. in thousands) REVENUES % of Rented % of Total Annualized Rental Tenant Property Type Sq. Ft. (1) Rented Sq. Ft. (1) Revenues (2) 1. Shook, Hardy & Bacon L.L.P. Office 596 1.4% 3.8% 2. Amazon.com, Inc. Industrial 3,048 7.0% 3.3% 3. Bank of America, National Association Office 593 1.4% 3.1% 4. Noble Energy, Inc. Office 497 1.1% 3.0% 5. Andeavor Office 618 1.4% 2.9% 6. F5 Networks, Inc. Office 299 0.7% 2.9% 7. WestRock Company Office 311 0.7% 2.6% 8. Northrop Grumman Innovation Systems, Inc Office 337 0.8% 2.2% 9. Tyson Foods, Inc. Office 248 0.6% 2.1% 10. Technicolor SA Industrial 1,371 3.1% 2.1% 11. Micro Focus Software Inc. Office 406 0.9% 1.7% 12. FedEx Corporation Office; Industrial 769 1.8% 1.6% 13. Arris International plc Office 228 0.5% 1.6% 14. PNC Bank, National Association Office 441 1.0% 1.4% 15. ServiceNow, Inc. Office 149 0.3% 1.3% 16. Allstate Insurance Company Office 458 1.0% 1.3% 17. Church & Dwight Co., Inc. Office 250 0.6% 1.2% 18. Restoration Hardware, Inc. Industrial 1,195 2.7% 1.2% 19. Compass Group USA, Inc. Office 267 0.6% 1.2% 20. Tailored Brands, Inc. Office 206 0.5% 1.2% 21. Automatic Data Processing, Inc. Office 289 0.7% 1.2% 22. Blackstone Group LLP Office 348 0.8% 1.1% 23. Primerica Life Insurance Company Office 344 0.8% 1.1% 24. American Tire Distributors, Inc. (3) Industrial 722 1.6% 1.1% 25. United Launch Alliance, LLC Office 168 0.4% 1.0% Total 14,158 32.4% 47.2% (1) Rented square feet is pursuant to existing leases as of September 30, 2018 and includes (i) space being fitted out for occupancy, if any, and (ii) space which is leased but is not occupied or is being offered for sublease by tenants, if any. (2) We define annualized rental revenues as the annualized contractual rents, as of September 30, 2018, including straight line rent adjustments and excluding lease value amortization, adjusted for tenant concessions including free rent and amounts reimbursed to tenants, plus estimated recurring expense reimbursements from tenants. In May 2018, one of our tenants defaulted on its lease for a property located in Naperville, IL. This table includes annualized rental revenues from the related subtenants, and reduced annualized rental revenues from the tenant that defaulted. See note (2) on page 15 for more information about this tenant and its default. (3) On October 4, 2018, American Tire Distributors, Inc., which occupies five of ILPT's properties with a total of approximately 722 rentable square feet filed for Chapter 11 bankruptcy. Although the tenant has paid its rental obligations through October 2018, the tenant may not pay future rents, may reject one or more of its leases and/or may seek to renegotiate its lease obligations. TENANTS REPRESENTING 1% OR MORE OF TOTAL CONSOLIDATED ANNUALIZED RENTAL CONSOLIDATED TENANTS REPRESENTING 1% OR MORE OF TOTAL Select Income REIT 43 Supplemental Operating and Financial Data, September 30, 2018
CONSOLIDATED THREE YEAR LEASE EXPIRATION SCHEDULE BY OWNER As of September 30, 2018 (dollars and sq. ft. in thousands) 2021 and Total 2018 2019 2020 Thereafter SIR (excluding ILPT): Total sq. ft. 16,538 Leased sq. ft. (1) 14,843 446 239 309 13,849 Percent 3.0% 1.6% 2.1% 93.3% Annualized rental revenues (2) $ 312,768 $ 5,246 $ 5,085 $ 8,078 $ 294,359 Percent 1.7% 1.6% 2.6% 94.1% ILPT: Total sq. ft. 29,216 Leased sq. ft. (1) 29,002 11 1,487 740 26,764 Percent —% 5.1% 2.6% 92.3% Annualized rental revenues (2) $ 163,448 $ 231 $ 4,321 $ 3,722 $ 155,174 Percent 0.1% 2.6% 2.3% 95.0% Consolidated: Total sq. ft. 45,754 Leased sq. ft. (1) 43,845 457 1,726 1,049 40,613 Percent 1.0% 3.9% 2.4% 92.7% Annualized rental revenues (2) $ 476,216 $ 5,477 $ 9,406 $ 11,800 $ 449,533 Percent 1.2% 2.0% 2.5% 94.3% (1) Leased square feet is pursuant to existing leases as of September 30, 2018 and includes (i) space being fitted out for occupancy, if any, and (ii) space which is leased but is not occupied, or is being offered for sublease by tenants, if any. (2) We define annualized rental revenues as the annualized contractual rents, as of September 30, 2018, including straight line rent adjustments and excluding lease value amortization, adjusted for tenant concessions including free rent and amounts reimbursed to tenants, plus estimated recurring expense reimbursements from tenants. CONSOLIDATED THREE YEAR LEASE EXPIRATION SCHEDULE BY OWNER SCHEDULE BY YEAR LEASE EXPIRATION THREE CONSOLIDATED Select Income REIT 44 Supplemental Operating and Financial Data, September 30, 2018
CONSOLIDATED PORTFOLIO LEASE EXPIRATION SCHEDULE As of September 30, 2018 (dollars and sq. ft. in thousands) Cumulative % of Total Cumulative % % of Total % of Total Rented Rented of Total Rented Annualized Annualized Annualized Number of Square Feet Square Feet Square Feet Rental Revenues Rental Revenues Rental Revenues Period / Year Tenants Expiring (1) Expiring (1) Expiring (1) Expiring (2) Expiring (2) Expiring (2) 10/1/2018 - 12/31/2018 6 457 1.0% 1.0% $ 5,477 1.2% 1.2% 2019 20 1,726 3.9% 4.9% 9,406 2.0% 3.2% 2020 21 1,049 2.4% 7.3% 11,800 2.5% 5.7% 2021 33 1,786 4.1% 11.4% 22,012 4.6% 10.3% 2022 71 3,806 8.7% 20.1% 48,624 10.2% 20.5% 2023 36 3,358 7.7% 27.8% 45,613 9.6% 30.1% 2024 25 7,004 16.0% 43.8% 70,957 14.9% 45.0% 2025 19 2,167 4.9% 48.7% 29,194 6.1% 51.1% 2026 9 1,773 4.0% 52.7% 27,368 5.7% 56.8% 2027 20 6,150 14.0% 66.7% 51,242 10.8% 67.6% Thereafter 99 14,569 33.3% 100.0% 154,523 32.4% 100.0% Total 359 43,845 100.0% $ 476,216 100.0% Weighted average remaining lease term (in years) 9.2 8.6 (1) Rented square feet is pursuant to existing leases as of September 30, 2018, and includes (i) space being fitted out for occupancy, if any, and (ii) space which is leased but is not CONSOLIDATED PORTFOLIO LEASE EXPIRATION SCHEDULE PORTFOLIO LEASE EXPIRATION CONSOLIDATED occupied or is being offered for sublease by tenants, if any. (2) We define annualized rental revenues as the annualized contractual rents, as of September 30, 2018, including straight line rent adjustments and excluding lease value amortization, adjusted for tenant concessions including free rent and amounts reimbursed to tenants, plus estimated recurring expense reimbursements from tenants. Select Income REIT 45 Supplemental Operating and Financial Data, September 30, 2018
SIR (EXCLUDING ILPT) PORTFOLIO LEASE EXPIRATION SCHEDULE As of September 30, 2018 (dollars and sq. ft. in thousands) Cumulative % of Total Cumulative % % of Total % of Total Rented Rented of Total Rented Annualized Annualized Annualized Number of Square Feet Square Feet Square Feet Rental Revenues Rental Revenues Rental Revenues Period / Year Tenants Expiring (1) Expiring (1) Expiring (1) Expiring (2) Expiring (2) Expiring (2) 10/1/2018 - 12/31/2018 3 446 3.0% 3.0% $ 5,246 1.7% 1.7% 2019 3 239 1.6% 4.6% 5,085 1.6% 3.3% 2020 4 309 2.1% 6.7% 8,078 2.6% 5.9% 2021 8 629 4.2% 10.9% 14,678 4.7% 10.6% 2022 9 1,079 7.3% 18.2% 27,823 8.9% 19.5% 2023 15 1,801 12.1% 30.3% 33,709 10.8% 30.3% 2024 12 2,253 15.2% 45.5% 55,148 17.6% 47.9% 2025 9 1,273 8.6% 54.1% 24,470 7.8% 55.7% 2026 6 1,136 7.7% 61.8% 23,891 7.6% 63.3% 2027 8 1,263 8.5% 70.3% 27,365 8.7% 72.0% Thereafter 11 4,415 29.7% 100.0% 87,275 28.0% 100.0% Total 88 14,843 100.0% $ 312,768 100.0% Weighted average remaining lease term (in years) 7.6 7.4 (1) Rented square feet is pursuant to existing leases as of September 30, 2018, and includes (i) space being fitted out for occupancy, if any, and (ii) space which is leased but is not occupied or is being offered for sublease by tenants, if any. (2) We define annualized rental revenues as the annualized contractual rents, as of September 30, 2018, including straight line rent adjustments and excluding lease value amortization, adjusted for tenant concessions including free rent and amounts reimbursed to tenants, plus estimated recurring expense reimbursements from tenants. SIR (EXCLUDING ILPT) PORTFOLIO LEASE EXPIRATION SCHEDULE SIR (EXCLUDING ILPT) PORTFOLIO LEASE EXPIRATION Select Income REIT 46 Supplemental Operating and Financial Data, September 30, 2018
ILPT PORTFOLIO LEASE EXPIRATION SCHEDULE As of September 30, 2018 (dollars and sq. ft. in thousands) Cumulative % of Total Cumulative % % of Total % of Total Rented Rented of Total Rented Annualized Annualized Annualized Number of Square Feet Square Feet Square Feet Rental Revenues Rental Revenues Rental Revenues Period / Year Tenants Expiring (1) Expiring (1) Expiring (1) Expiring (2) Expiring (2) Expiring (2) 10/1/2018 - 12/31/2018 3 11 —% —% $ 231 0.1% 0.1% 2019 17 1,487 5.1% 5.1% 4,321 2.6% 2.7% 2020 17 740 2.6% 7.7% 3,722 2.3% 5.0% 2021 25 1,157 4.0% 11.7% 7,334 4.5% 9.5% 2022 62 2,727 9.4% 21.1% 20,801 12.7% 22.2% 2023 21 1,557 5.4% 26.5% 11,904 7.3% 29.5% 2024 13 4,751 16.4% 42.9% 15,809 9.7% 39.2% 2025 10 894 3.1% 46.0% 4,724 2.9% 42.1% 2026 3 637 2.2% 48.2% 3,477 2.1% 44.2% 2027 12 4,887 16.9% 65.1% 23,877 14.6% 58.8% Thereafter 88 10,154 34.9% 100.0% 67,248 41.2% 100.0% Total 271 29,002 100.0% $ 163,448 100.0% ILPT PORTFOLIO LEASE EXPIRATION SCHEDULE ILPT PORTFOLIO LEASE EXPIRATION Weighted average remaining lease term (in years) 10.0 10.9 (1) Rented square feet is pursuant to existing leases as of September 30, 2018, and includes (i) space being fitted out for occupancy, if any, and (ii) space which is leased but is not occupied or is being offered for sublease by tenants, if any. (2) We define annualized rental revenues as the annualized contractual rents, as of September 30, 2018, including straight line rent adjustments and excluding lease value amortization, adjusted for tenant concessions including free rent and amounts reimbursed to tenants, plus estimated recurring expense reimbursements from tenants. Select Income REIT 47 Supplemental Operating and Financial Data, September 30, 2018
HAWAII LAND RENT RESET SUMMARY (1) (dollars and sq. ft. in thousands) Historical Hawaii Land Rent Resets: For the Three Months Ended 9/30/2018 6/30/2018 3/31/2018 12/31/2017 9/30/2017 Number of leases reset 11 1 — 4 1 Square feet 516 34 — 200 27 Percent change in GAAP rent (2) 20.3% 18.0% —% 38.6% 45.3% Scheduled Hawaii Land Rent Resets (3): As of September 30, 2018 Number Annualized of Resets Sq. Ft. Rental Revenues (4) 10/1/2018 - 12/31/2018 — — $ — 2019 9 1,969 7,012 HAWAII LAND RENT RESET SUMMARY HAWAII 2020 4 359 2,527 2021 and thereafter 40 2,742 20,001 Total 53 5,070 $ 29,540 (1) All rent resets relate to properties owned by ILPT. (2) Represents percent change in prior rents charged for same space. Reset rents include estimated recurring expense reimbursements and exclude lease value amortization. (3) Includes rent resets that have not yet been reset but does not include any agreed upon rent resets that are effective after September 30, 2018. (4) We define annualized rental revenues as the annualized contractual rents, as of September 30, 2018, including straight line rent adjustments and excluding lease value amortization, adjusted for tenant concessions including free rent and amounts reimbursed to tenants, plus estimated recurring expense reimbursements from tenants. Select Income REIT 48 Supplemental Operating and Financial Data, September 30, 2018
EXHIBIT A 445 Jan Davis Drive, Huntsville, AL Square Feet: 57,420 Digium, Inc. Corporate Headquarters 4949
CONSOLIDATED PROPERTY DETAIL As of September 30, 2018 (dollars and square feet in thousands) EXHIBIT A Number of Year Buildings, Annualized Built or Land Parcels Rental Undepreciated Depreciated Date Most Recent Property City State and Easements Owner Property Type Square Feet % Leased Revenues (1) Carrying Value (2) Carrying Value (2) Acquired (3) Renovation 40 Inverness Center Parkway Birmingham AL 1 SIR Owned Office 149 100.0% $ 1,618 $ 12,293 $ 10,193 12/9/2010 1984 42 Inverness Center Parkway Birmingham AL 1 SIR Owned Office 149 100.0% 1,615 12,343 10,206 12/9/2010 1985 44 Inverness Center Parkway Birmingham AL 1 SIR Owned Office 150 100.0% 2,625 20,539 18,436 12/9/2010 1985 46 Inverness Center Parkway Birmingham AL — SIR Owned Land — —% — 2,000 2,000 12/9/2010 — 445 Jan Davis Drive Huntsville AL 1 SIR Owned Office 57 100.0% 1,005 10,280 9,813 7/22/2016 2007 4905 Moores Mill Road Huntsville AL 1 SIR Owned Industrial 1,370 100.0% 9,790 73,001 62,755 8/31/2012 2007 4501 Industrial Drive Fort Smith AR 1 ILPT Owned Industrial 64 100.0% 469 4,385 4,065 1/29/2015 2013 16001 North 28th Avenue Phoenix AZ 1 SIR Owned Office 105 100.0% 1,730 13,749 12,793 4/16/2015 2007 2149 West Dunlap Avenue Phoenix AZ 1 SIR Owned Office 122 100.0% 2,486 20,135 18,804 1/29/2015 1983 1920 and 1930 W University Drive Tempe AZ 2 SIR Owned Office 100 100.0% 2,015 13,461 8,129 6/30/1999 1988 2544 and 2548 Campbell Place Carlsbad CA 2 SIR Owned Office 94 100.0% 2,604 21,314 18,623 9/21/2012 2007 2235 Iron Point Road Folsom CA 1 SIR Owned Office 95 100.0% 3,504 28,954 24,013 12/17/2010 2009 47131 Bayside Parkway Fremont CA 1 SIR Owned Office 101 100.0% 2,199 11,912 10,633 3/19/2009 1990 100 Redwood Shores Parkway Redwood City CA 1 SIR Owned Office 63 100.0% 3,125 35,531 33,401 1/29/2015 2014 3875 Atherton Road Rocklin CA 1 SIR Owned Office 19 100.0% 419 4,180 3,815 1/29/2015 1991 145 Rio Robles Drive San Jose CA 1 SIR Owned Office 57 100.0% 1,933 13,799 12,793 12/23/2013 2010 CONSOLIDATED PROPERTY DETAIL PROPERTY CONSOLIDATED 2090 Fortune Drive San Jose CA 1 SIR Owned Office 72 100.0% 1,233 7,698 7,515 1/29/2015 2014 2115 O'Nel Drive San Jose CA 1 SIR Owned Office 99 100.0% 3,201 33,200 30,895 1/29/2015 2013 3939 North First Street San Jose CA 1 SIR Owned Office 64 100.0% 2,020 14,494 13,529 12/23/2013 2013 51 and 77 Rio Robles Drive San Jose CA 2 SIR Owned Office 129 100.0% 2,626 31,478 29,113 12/23/2013 2011 6448-6450 Via Del Oro San Jose CA 1 SIR Owned Office 76 100.0% 1,762 14,737 13,644 1/29/2015 1983 2450 and 2500 Walsh Avenue Santa Clara CA 2 SIR Owned Office 132 100.0% 4,607 44,969 41,608 1/29/2015 2014 3250 and 3260 Jay Street Santa Clara CA 2 SIR Owned Office 149 100.0% 6,140 63,958 59,186 1/29/2015 2013 350 West Java Drive Sunnyvale CA 1 SIR Owned Office 96 100.0% 2,878 24,083 22,239 11/15/2012 2012 7958 South Chester Street Centennial CO 1 SIR Owned Office 168 100.0% 4,992 31,049 28,890 1/29/2015 2000 350 Spectrum Loop Colorado Springs CO 1 SIR Owned Office 156 100.0% 2,616 23,272 21,423 1/29/2015 2000 955 Aeroplaza Drive Colorado Springs CO 1 ILPT Owned Industrial 125 100.0% 900 8,212 7,532 1/29/2015 2012 13400 East 39th Avenue and 3800 Wheeling Street Denver CO 2 ILPT Owned Industrial 394 100.0% 1,358 16,101 14,887 1/29/2015 1996 333 Inverness Drive South Englewood CO 1 SIR Owned Office 140 100.0% 2,825 17,306 15,386 6/15/2012 1998 150 Greenhorn Drive Pueblo CO 1 ILPT Owned Industrial 54 100.0% 543 4,377 3,994 1/29/2015 2013 2 Tower Drive Wallingford CT 1 ILPT Owned Industrial 62 100.0% 404 3,643 2,988 10/24/2006 1978 1 Targeting Center Windsor CT 1 SIR Owned Office 97 100.0% 1,119 9,076 7,962 7/20/2012 1999 235 Great Pond Drive Windsor CT 1 ILPT Owned Industrial 171 100.0% 1,383 11,869 10,409 7/20/2012 2004 10450 Doral Boulevard Doral FL 1 ILPT Owned Industrial 240 100.0% 2,272 43,327 43,092 6/27/2018 2001 10350 NW 112th Avenue Miami FL 1 SIR Owned Office 79 100.0% 3,056 23,743 21,902 1/29/2015 2002 (1) We define annualized rental revenues as the annualized contractual rents, as of September 30, 2018, including straight line rent adjustments and excluding lease value amortization, adjusted for tenant concessions including free rent and amounts reimbursed to tenants, plus estimated recurring expense reimbursements from tenants. (2) Excludes the value of real estate intangibles. (3) Date acquired is the date we acquired the property or the date our former parent entity acquired the property for those properties that our former parent entity contributed to us in February 2012 in connection with our initial public offering, or IPO. Select Income REIT 50 Supplemental Operating and Financial Data, September 30, 2018
CONSOLIDATED PROPERTY DETAIL (CONTINUED) As of September 30, 2018 (dollars and square feet in thousands) EXHIBIT A Number of Year Buildings, Annualized Built or Land Parcels Rental Undepreciated Depreciated Date Most Recent Property City State and Easements Owner Property Type Square Feet % Leased Revenues (1) Carrying Value (2) Carrying Value (2) Acquired (3) Renovation 2100 NW 82nd Avenue Miami FL 1 ILPT Owned Industrial 37 100.0% 264 1,895 1,158 3/19/1998 2013 One Primerica Parkway Duluth GA 1 SIR Owned Office 344 100.0% 5,249 57,332 52,709 1/29/2015 2013 1000 Mapunapuna Street Honolulu HI 1 ILPT Owned Land 42 100.0% 428 2,252 2,252 12/5/2003 — 1001 Ahua Street Honolulu HI 1 ILPT Owned Land 338 100.0% 2,664 18,559 17,312 12/5/2003 — 1024 Kikowaena Place Honolulu HI 1 ILPT Owned Land 40 100.0% 312 1,818 1,818 12/5/2003 — 1024 Mapunapuna Street Honolulu HI 1 ILPT Owned Land 26 100.0% 223 1,385 1,385 12/5/2003 — 1027 Kikowaena Place Honolulu HI 1 ILPT Owned Land 102 100.0% 794 5,444 5,444 12/5/2003 — 1030 Mapunapuna Street Honolulu HI 1 ILPT Owned Land 122 100.0% 1,009 5,655 5,655 12/5/2003 — 1038 Kikowaena Place Honolulu HI 1 ILPT Owned Land 47 100.0% 361 2,576 2,576 12/5/2003 — 1045 Mapunapuna Street Honolulu HI 1 ILPT Owned Land 15 100.0% 109 819 819 12/5/2003 — 1050 Kikowaena Place Honolulu HI 1 ILPT Owned Land 43 100.0% 329 2,277 1,954 12/5/2003 — 1052 Ahua Street Honolulu HI 1 ILPT Owned Land 30 100.0% 197 1,943 1,865 12/5/2003 — 1055 Ahua Street Honolulu HI 1 ILPT Owned Land 27 100.0% 206 1,216 1,216 12/5/2003 — 106 Puuhale Road Honolulu HI 1 ILPT Owned Industrial 14 100.0% 261 1,342 1,291 12/5/2003 1966 1062 Kikowaena Place Honolulu HI 1 ILPT Owned Land 31 100.0% 241 1,647 1,426 12/5/2003 — 1122 Mapunapuna Street Honolulu HI 1 ILPT Owned Land 106 100.0% 791 5,781 5,781 12/5/2003 — 113 Puuhale Road Honolulu HI 1 ILPT Owned Land 77 100.0% 550 3,729 3,729 12/5/2003 — 1150 Kikowaena Place Honolulu HI 1 ILPT Owned Land 46 100.0% 531 2,445 2,445 12/5/2003 — 120 Mokauea Street Honolulu HI 1 ILPT Owned Industrial 31 100.0% 446 2,608 2,509 12/5/2003 1970 120 Sand Island Access Road Honolulu HI 1 ILPT Owned Industrial 71 100.0% 1,288 13,735 9,493 11/23/2004 2004 120B Mokauea Street Honolulu HI 1 ILPT Owned Industrial 35 100.0% 542 1,953 1,953 12/5/2003 1970 125 Puuhale Road Honolulu HI 1 ILPT Owned Land 31 100.0% 260 1,630 1,630 12/5/2003 — 125B Puuhale Road Honolulu HI 1 ILPT Owned Land 49 100.0% 349 2,815 2,815 12/5/2003 — 1330 Pali Highway Honolulu HI 1 ILPT Owned Land 20 100.0% 459 1,423 1,423 12/5/2003 — 1360 Pali Highway Honolulu HI 1 ILPT Owned Land 126 100.0% 2,853 9,331 9,230 12/5/2003 — 140 Puuhale Road Honolulu HI 1 ILPT Owned Land 22 100.0% 204 1,100 1,100 12/5/2003 — 142 Mokauea Street Honolulu HI 1 ILPT Owned Industrial 26 100.0% 405 3,637 3,288 12/5/2003 1972 148 Mokauea Street Honolulu HI 1 ILPT Owned Land 86 100.0% 729 3,476 3,476 12/5/2003 — CONSOLIDATED PROPERTY DETAIL (CONTINUED) DETAIL PROPERTY CONSOLIDATED 150 Puuhale Road Honolulu HI 1 ILPT Owned Land 123 100.0% 1,068 4,887 4,887 12/5/2003 — 151 Puuhale Road Honolulu HI 1 ILPT Owned Land 38 100.0% 343 1,956 1,956 12/5/2003 — 158 Sand Island Access Road Honolulu HI 1 ILPT Owned Land 101 100.0% 747 2,488 2,488 12/5/2003 — 165 Sand Island Access Road Honolulu HI 1 ILPT Owned Land 16 100.0% 118 758 758 12/5/2003 — 179 Sand Island Access Road Honolulu HI 1 ILPT Owned Land 62 100.0% 640 2,480 2,480 12/5/2003 — 180 Sand Island Access Road Honolulu HI 1 ILPT Owned Land 67 100.0% 563 1,655 1,655 12/5/2003 — 1926 Auiki Street Honolulu HI 1 ILPT Owned Industrial 42 100.0% 620 4,436 3,982 12/5/2003 1959 1931 Kahai Street Honolulu HI 1 ILPT Owned Land 96 100.0% 944 3,779 3,779 12/5/2003 — (1) We define annualized rental revenues as the annualized contractual rents, as of September 30, 2018, including straight line rent adjustments and excluding lease value amortization, adjusted for tenant concessions including free rent and amounts reimbursed to tenants, plus estimated recurring expense reimbursements from tenants. (2) Excludes the value of real estate intangibles. (3) Date acquired is the date we acquired the property or the date our former parent entity acquired the property for those properties that our former parent entity contributed to us in February 2012 in connection with our IPO. Select Income REIT 51 Supplemental Operating and Financial Data, September 30, 2018
CONSOLIDATED PROPERTY DETAIL (CONTINUED) As of September 30, 2018 (dollars and square feet in thousands) EXHIBIT A Number of Year Buildings, Annualized Built or Land Parcels Rental Undepreciated Depreciated Date Most Recent Property City State and Easements Owner Property Type Square Feet % Leased Revenues (1) Carrying Value (2) Carrying Value (2) Acquired (3) Renovation 197 Sand Island Access Road Honolulu HI 1 ILPT Owned Land 31 100.0% 301 1,238 1,238 12/5/2003 — 2001 Kahai Street Honolulu HI 1 ILPT Owned Land 27 100.0% 249 1,091 1,091 12/5/2003 — 2019 Kahai Street Honolulu HI 1 ILPT Owned Land 27 100.0% 263 1,377 1,377 12/5/2003 — 2020 Auiki Street Honolulu HI 1 ILPT Owned Land 47 100.0% 351 2,385 2,385 12/5/2003 — 204 Sand Island Access Road Honolulu HI 1 ILPT Owned Land 33 100.0% 260 1,689 1,689 12/5/2003 — 207 Puuhale Road Honolulu HI 1 ILPT Owned Land 40 100.0% 348 2,024 2,024 12/5/2003 — 2103 Kaliawa Street Honolulu HI 1 ILPT Owned Land 79 100.0% 688 3,212 3,212 12/5/2003 — 2106 Kaliawa Street Honolulu HI 1 ILPT Owned Land 31 100.0% 275 1,737 1,673 12/5/2003 — 2110 Auiki Street Honolulu HI 1 ILPT Owned Land 20 100.0% 260 837 837 12/5/2003 — 212 Mohonua Place Honolulu HI 1 ILPT Owned Land 46 100.0% 382 1,067 1,067 12/5/2003 — 2122 Kaliawa Street Honolulu HI 1 ILPT Owned Land 33 100.0% 327 1,365 1,365 12/5/2003 — 2127 Auiki Street Honolulu HI 1 ILPT Owned Land 57 100.0% 533 3,003 2,980 12/5/2003 — 2135 Auiki Street Honolulu HI 1 ILPT Owned Land 33 100.0% 259 825 825 12/5/2003 — 2139 Kaliawa Street Honolulu HI 1 ILPT Owned Land 22 100.0% 196 885 885 12/5/2003 — 214 Sand Island Access Road Honolulu HI 1 ILPT Owned Industrial 22 100.0% 431 2,268 2,228 12/5/2003 1981 2140 Kaliawa Street Honolulu HI 1 ILPT Owned Land 19 100.0% 150 931 931 12/5/2003 — 2144 Auiki Street Honolulu HI 1 ILPT Owned Industrial 54 98.3% 1,278 9,598 7,581 12/5/2003 1953 215 Puuhale Road Honolulu HI 1 ILPT Owned Land 42 100.0% 377 2,117 2,117 12/5/2003 — 218 Mohonua Place Honolulu HI 1 ILPT Owned Land 34 100.0% 272 1,741 1,741 12/5/2003 — 220 Puuhale Road Honolulu HI 1 ILPT Owned Land 66 100.0% 592 2,619 2,619 12/5/2003 — 2250 Pahounui Drive Honolulu HI 1 ILPT Owned Land 76 100.0% 563 3,862 3,862 12/5/2003 — 2264 Pahounui Drive Honolulu HI 1 ILPT Owned Land 33 100.0% 244 1,632 1,632 12/5/2003 — 2276 Pahounui Drive Honolulu HI 1 ILPT Owned Land 33 100.0% 247 1,619 1,619 12/5/2003 — 228 Mohonua Place Honolulu HI 1 ILPT Owned Land 37 100.0% 343 1,865 1,865 12/5/2003 — 2308 Pahounui Drive Honolulu HI 1 ILPT Owned Land 65 100.0% 464 3,314 3,314 12/5/2003 — 231 Sand Island Access Road Honolulu HI 1 ILPT Owned Land 19 100.0% 162 752 752 12/5/2003 — 231B Sand Island Access Road Honolulu HI 1 ILPT Owned Land 39 100.0% 366 1,539 1,539 12/5/2003 — 2344 Pahounui Drive Honolulu HI 1 ILPT Owned Land 144 100.0% 1,332 6,709 6,709 12/5/2003 — CONSOLIDATED PROPERTY DETAIL (CONTINUED) DETAIL PROPERTY CONSOLIDATED 238 Sand Island Access Road Honolulu HI 1 ILPT Owned Land 60 100.0% 546 2,273 2,273 12/5/2003 — 2635 Waiwai Loop A Honolulu HI 1 ILPT Owned Land 23 100.0% 212 1,284 1,155 12/5/2003 — 2635 Waiwai Loop B Honolulu HI 1 ILPT Owned Land 22 100.0% 209 1,282 1,243 12/5/2003 — 2760 Kam Highway Honolulu HI 1 ILPT Owned Land 29 100.0% 147 818 818 12/5/2003 — 2804 Kilihau Street Honolulu HI 1 ILPT Owned Land 34 100.0% 256 1,777 1,776 12/5/2003 — 2806 Kaihikapu Street Honolulu HI 1 ILPT Owned Land 35 100.0% 278 1,801 1,801 12/5/2003 — 2808 Kam Highway Honolulu HI 1 ILPT Owned Land 13 100.0% 104 310 310 12/5/2003 — 2809 Kaihikapu Street Honolulu HI 1 ILPT Owned Land 36 100.0% 278 1,837 1,837 12/5/2003 — 2810 Paa Street Honolulu HI 1 ILPT Owned Land 52 100.0% 416 3,340 3,340 12/5/2003 — (1) We define annualized rental revenues as the annualized contractual rents, as of September 30, 2018, including straight line rent adjustments and excluding lease value amortization, adjusted for tenant concessions including free rent and amounts reimbursed to tenants, plus estimated recurring expense reimbursements from tenants. (2) Excludes the value of real estate intangibles. (3) Date acquired is the date we acquired the property or the date our former parent entity acquired the property for those properties that our former parent entity contributed to us in February 2012 in connection with our IPO. Select Income REIT 52 Supplemental Operating and Financial Data, September 30, 2018
CONSOLIDATED PROPERTY DETAIL (CONTINUED) As of September 30, 2018 (dollars and square feet in thousands) EXHIBIT A Number of Year Buildings, Annualized Built or Land Parcels Rental Undepreciated Depreciated Date Most Recent Property City State and Easements Owner Property Type Square Feet % Leased Revenues (1) Carrying Value (2) Carrying Value (2) Acquired (3) Renovation 2810 Pukoloa Street Honolulu HI 1 ILPT Owned Land 412 100.0% 2,682 27,703 27,699 12/5/2003 — 2812 Awaawaloa Street Honolulu HI 1 ILPT Owned Land 35 100.0% 273 1,804 1,802 12/5/2003 — 2814 Kilihau Street Honolulu HI 1 ILPT Owned Land 37 100.0% 281 1,925 1,925 12/5/2003 — 2815 Kaihikapu Street Honolulu HI 1 ILPT Owned Land 35 100.0% 213 1,823 1,822 12/5/2003 — 2815 Kilihau Street Honolulu HI 1 ILPT Owned Land 12 100.0% 98 287 287 12/5/2003 — 2816 Awaawaloa Street Honolulu HI 1 ILPT Owned Land 44 100.0% 238 1,036 1,026 12/5/2003 — 2819 Mokumoa Street - A Honolulu HI 1 ILPT Owned Land 35 100.0% 274 1,821 1,821 12/5/2003 — 2819 Mokumoa Street - B Honolulu HI 1 ILPT Owned Land 35 100.0% 270 1,816 1,816 12/5/2003 — 2819 Pukoloa Street Honolulu HI 1 ILPT Owned Land 40 100.0% 286 2,123 2,115 12/5/2003 — 2821 Kilihau Street Honolulu HI 1 ILPT Owned Land 12 100.0% 98 287 287 12/5/2003 — 2826 Kaihikapu Street Honolulu HI 1 ILPT Owned Land 70 100.0% 438 3,921 3,921 12/5/2003 — 2827 Kaihikapu Street Honolulu HI 1 ILPT Owned Land 35 100.0% 273 1,801 1,801 12/5/2003 — 2828 Paa Street Honolulu HI 1 ILPT Owned Land 187 100.0% 1,494 12,448 12,448 12/5/2003 — 2829 Awaawaloa Street Honolulu HI 1 ILPT Owned Land 70 100.0% 519 1,722 1,720 12/5/2003 — 2928 Kaihikapu Street - A Honolulu HI 1 ILPT Owned Land 35 100.0% 277 1,801 1,801 12/5/2003 — 2829 Kilihau Street Honolulu HI 1 ILPT Owned Land 12 100.0% 98 287 287 12/5/2003 — 2829 Pukoloa Street Honolulu HI 1 ILPT Owned Land 40 100.0% 305 2,088 2,088 12/5/2003 — 2830 Mokumoa Street Honolulu HI 1 ILPT Owned Land 40 100.0% 296 2,146 2,146 12/5/2003 — 2831 Awaawaloa Street Honolulu HI 1 ILPT Owned Land 35 100.0% 270 860 860 12/5/2003 — 2831 Kaihikapu Street Honolulu HI 1 ILPT Owned Land 35 100.0% 212 1,857 1,642 12/5/2003 — 2833 Kilihau Street Honolulu HI 1 ILPT Owned Land 12 100.0% 97 601 601 12/5/2003 — 2833 Paa Street Honolulu HI 1 ILPT Owned Land 30 100.0% 291 1,701 1,701 12/5/2003 — 2833 Paa Street #2 Honolulu HI 1 ILPT Owned Land 30 100.0% 291 1,675 1,675 12/5/2003 — 2836 Awaawaloa Street Honolulu HI 1 ILPT Owned Land 26 100.0% 144 1,353 1,353 12/5/2003 — 2838 Kilihau Street Honolulu HI 1 ILPT Owned Land 83 100.0% 665 4,262 4,262 12/5/2003 — 2839 Kilihau Street Honolulu HI 1 ILPT Owned Land 12 100.0% 109 627 627 12/5/2003 — 2839 Mokumoa Street Honolulu HI 1 ILPT Owned Land 35 100.0% 238 1,942 1,942 12/5/2003 — 2840 Mokumoa Street Honolulu HI 1 ILPT Owned Land 40 100.0% 304 2,149 2,149 12/5/2003 — CONSOLIDATED PROPERTY DETAIL (CONTINUED) DETAIL PROPERTY CONSOLIDATED 2841 Pukoloa Street Honolulu HI 1 ILPT Owned Land 40 100.0% 316 2,088 2,088 12/5/2003 — 2844 Kaihikapu Street Honolulu HI 1 ILPT Owned Land 35 100.0% 259 1,974 1,963 12/5/2003 — 2846-A Awaawaloa Street Honolulu HI 1 ILPT Owned Land 61 100.0% 474 3,135 2,782 12/5/2003 — 2847 Awaawaloa Street Honolulu HI 1 ILPT Owned Land 35 100.0% 354 885 773 12/5/2003 — 2849 Kaihikapu Street Honolulu HI 1 ILPT Owned Land 35 100.0% 280 860 860 12/5/2003 — 2850 Awaawaloa Street Honolulu HI 1 ILPT Owned Land 9 100.0% 66 459 395 12/5/2003 — 2850 Mokumoa Street Honolulu HI 1 ILPT Owned Land 40 100.0% 305 2,143 2,143 12/5/2003 — 2850 Paa Street Honolulu HI 1 ILPT Owned Land 298 100.0% 2,146 22,827 22,827 12/5/2003 — 2855 Kaihikapu Street Honolulu HI 1 ILPT Owned Land 35 100.0% 318 1,807 1,807 12/5/2003 — (1) We define annualized rental revenues as the annualized contractual rents, as of September 30, 2018, including straight line rent adjustments and excluding lease value amortization, adjusted for tenant concessions including free rent and amounts reimbursed to tenants, plus estimated recurring expense reimbursements from tenants. (2) Excludes the value of real estate intangibles. (3) Date acquired is the date we acquired the property or the date our former parent entity acquired the property for those properties that our former parent entity contributed to us in February 2012 in connection with our IPO. Select Income REIT 53 Supplemental Operating and Financial Data, September 30, 2018
CONSOLIDATED PROPERTY DETAIL (CONTINUED) As of September 30, 2018 (dollars and square feet in thousands) EXHIBIT A Number of Year Buildings, Annualized Built or Land Parcels Rental Undepreciated Depreciated Date Most Recent Property City State and Easements Owner Property Type Square Feet % Leased Revenues (1) Carrying Value (2) Carrying Value (2) Acquired (3) Renovation 2855 Pukoloa Street Honolulu HI 1 ILPT Owned Land 40 100.0% 291 1,934 1,934 12/5/2003 — 2857 Awaawaloa Street Honolulu HI 1 ILPT Owned Land 40 100.0% 311 983 983 12/5/2003 — 2858 Kaihikapu Street Honolulu HI 1 ILPT Owned Land 35 100.0% 278 1,801 1,801 12/5/2003 — 2861 Mokumoa Street Honolulu HI 1 ILPT Owned Land 70 100.0% 431 3,867 3,867 12/5/2003 — 2864 Awaawaloa Street Honolulu HI 1 ILPT Owned Land 35 100.0% 285 1,842 1,839 12/5/2003 — 2864 Mokumoa Street Honolulu HI 1 ILPT Owned Land 40 100.0% 273 2,092 2,092 12/5/2003 — 2865 Pukoloa Street Honolulu HI 1 ILPT Owned Land 40 100.0% 299 1,934 1,934 12/5/2003 — 2868 Kaihikapu Street Honolulu HI 1 ILPT Owned Land 35 100.0% 377 1,801 1,801 12/5/2003 — 2869 Mokumoa Street Honolulu HI 1 ILPT Owned Land 35 100.0% 289 1,794 1,794 12/5/2003 — 2875 Paa Street Honolulu HI 1 ILPT Owned Land 23 100.0% 229 1,330 1,330 12/5/2003 — 2879 Mokumoa Street Honolulu HI 1 ILPT Owned Land 35 100.0% 278 1,789 1,789 12/5/2003 — 2879 Paa Street Honolulu HI 1 ILPT Owned Land 31 100.0% 229 1,735 1,724 12/5/2003 — 2886 Paa Street Honolulu HI 1 ILPT Owned Land 60 100.0% 702 2,205 2,205 12/5/2003 — 2889 Mokumoa Street Honolulu HI 1 ILPT Owned Land 35 100.0% 289 1,783 1,783 12/5/2003 — 2906 Kaihikapu Street Honolulu HI 1 ILPT Owned Land 35 100.0% 295 1,816 1,815 12/5/2003 — 2908 Kaihikapu Street Honolulu HI 1 ILPT Owned Land 35 100.0% 360 1,810 1,809 12/5/2003 — 2915 Kaihikapu Street Honolulu HI 1 ILPT Owned Land 105 100.0% 867 2,579 2,579 12/5/2003 — 2927 Mokumoa Street Honolulu HI 1 ILPT Owned Land 35 100.0% 268 1,778 1,778 12/5/2003 — 2928 Kaihikapu Street - B Honolulu HI 1 ILPT Owned Land 38 100.0% 289 1,948 1,948 12/5/2003 — 2960 Mokumoa Street Honolulu HI 1 ILPT Owned Land 38 100.0% 318 1,977 1,977 12/5/2003 — 2965 Mokumoa Street Honolulu HI 1 ILPT Owned Land 42 100.0% 337 2,140 2,140 12/5/2003 — 2969 Mapunapuna Street Honolulu HI 1 ILPT Owned Land 80 100.0% 381 4,053 4,045 12/5/2003 — 2970 Mokumoa Street Honolulu HI 1 ILPT Owned Land 35 100.0% 291 1,722 1,722 12/5/2003 — 33 S. Vineyard Boulevard Honolulu HI 1 ILPT Owned Land 12 100.0% 142 850 844 12/5/2003 — 525 N. King Street Honolulu HI 1 ILPT Owned Land 21 100.0% 241 1,342 1,342 12/5/2003 — 609 Ahua Street Honolulu HI 1 ILPT Owned Land 24 100.0% 213 624 618 12/5/2003 — 619 Mapunapuna Street Honolulu HI 1 ILPT Owned Land 55 100.0% 528 1,415 1,414 12/5/2003 — 645 Ahua Street Honolulu HI 1 ILPT Owned Land 35 100.0% 265 882 882 12/5/2003 — CONSOLIDATED PROPERTY DETAIL (CONTINUED) DETAIL PROPERTY CONSOLIDATED 659 Ahua Street Honolulu HI 1 ILPT Owned Land 35 100.0% 256 880 864 12/5/2003 — 659 Puuloa Road Honolulu HI 1 ILPT Owned Land 35 100.0% 273 1,807 1,807 12/5/2003 — 660 Ahua Street Honolulu HI 1 ILPT Owned Land 35 100.0% 196 1,787 1,784 12/5/2003 — 667 Puuloa Road Honolulu HI 1 ILPT Owned Land 35 100.0% 291 862 860 12/5/2003 — 669 Ahua Street Honolulu HI 1 ILPT Owned Land 35 100.0% 480 1,877 1,860 12/5/2003 — 673 Ahua Street Honolulu HI 1 ILPT Owned Land 35 100.0% 259 1,801 1,801 12/5/2003 — 675 Mapunapuna Street Honolulu HI 1 ILPT Owned Land 30 100.0% 222 1,081 1,081 12/5/2003 — 679 Puuloa Road Honolulu HI 1 ILPT Owned Land 35 100.0% 275 1,810 1,808 12/5/2003 — 685 Ahua Street Honolulu HI 1 ILPT Owned Land 35 100.0% 270 1,801 1,801 12/5/2003 — (1) We define annualized rental revenues as the annualized contractual rents, as of September 30, 2018, including straight line rent adjustments and excluding lease value amortization, adjusted for tenant concessions including free rent and amounts reimbursed to tenants, plus estimated recurring expense reimbursements from tenants. (2) Excludes the value of real estate intangibles. (3) Date acquired is the date we acquired the property or the date our former parent entity acquired the property for those properties that our former parent entity contributed to us in February 2012 in connection with our IPO. Select Income REIT 54 Supplemental Operating and Financial Data, September 30, 2018
CONSOLIDATED PROPERTY DETAIL (CONTINUED) As of September 30, 2018 (dollars and square feet in thousands) EXHIBIT A Number of Year Buildings, Annualized Built or Land Parcels Rental Undepreciated Depreciated Date Most Recent Property City State and Easements Owner Property Type Square Feet % Leased Revenues (1) Carrying Value (2) Carrying Value (2) Acquired (3) Renovation 673 Mapunapuna Street Honolulu HI 1 ILPT Owned Land 35 100.0% 275 1,821 1,806 12/5/2003 — 692 Mapunapuna Street Honolulu HI 1 ILPT Owned Land 35 100.0% 370 1,798 1,798 12/5/2003 — 697 Ahua Street Honolulu HI 1 ILPT Owned Land 35 100.0% 299 1,805 1,503 12/5/2003 — 702 Ahua Street Honolulu HI 1 ILPT Owned Land 35 100.0% 267 1,787 1,784 12/5/2003 — 704 Mapunapuna Street Honolulu HI 1 ILPT Owned Land 59 100.0% 469 3,075 2,821 12/5/2003 — 709 Ahua Street Honolulu HI 1 ILPT Owned Land 35 100.0% 330 1,801 1,801 12/5/2003 — 719 Ahua Street Honolulu HI 1 ILPT Owned Land 35 100.0% 296 1,960 1,960 12/5/2003 — 729 Ahua Street Honolulu HI 1 ILPT Owned Land 35 100.0% 232 1,801 1,801 12/5/2003 — 733 Mapunapuna Street Honolulu HI 1 ILPT Owned Land 65 100.0% 676 3,403 3,403 12/5/2003 — 739 Ahua Street Honolulu HI 1 ILPT Owned Land 35 100.0% 238 1,801 1,801 12/5/2003 — 759 Puuloa Road Honolulu HI 1 ILPT Owned Land 34 100.0% 267 1,769 1,766 12/5/2003 — 761 Ahua Street Honolulu HI 1 ILPT Owned Land 73 100.0% 548 3,759 3,758 12/5/2003 — 766 Mapunapuna Street Honolulu HI 1 ILPT Owned Land 35 100.0% 279 1,801 1,801 12/5/2003 — 770 Mapunapuna Street Honolulu HI 1 ILPT Owned Land 35 100.0% 343 1,801 1,801 12/5/2003 — 789 Mapunapuna Street Honolulu HI 1 ILPT Owned Land 47 100.0% 263 2,611 2,609 12/5/2003 — 80 Sand Island Access Road Honolulu HI 1 ILPT Owned Land 191 100.0% 1,564 7,972 7,972 12/5/2003 — 803 Ahua Street Honolulu HI 1 ILPT Owned Land 73 100.0% 715 3,804 3,804 12/5/2003 — 808 Ahua Street Honolulu HI 1 ILPT Owned Land 57 100.0% 505 3,279 3,279 12/5/2003 — 812 Mapunapuna Street Honolulu HI 1 ILPT Owned Land 35 100.0% 267 2,613 2,613 12/5/2003 — 819 Ahua Street Honolulu HI 1 ILPT Owned Land 105 100.0% 1,036 5,434 5,208 12/5/2003 — 822 Mapunapuna Street Honolulu HI 1 ILPT Owned Land 35 100.0% 322 1,810 1,798 12/5/2003 — 830 Mapunapuna Street Honolulu HI 1 ILPT Owned Land 35 100.0% 273 1,826 1,807 12/5/2003 — 842 Mapunapuna Street Honolulu HI 1 ILPT Owned Land 35 100.0% 314 1,809 1,798 12/5/2003 — 846 Ala Lilikoi Boulevard B Honolulu HI 1 ILPT Owned Land 8 100.0% 42 234 234 12/5/2003 — 848 Ala Lilikoi Boulevard A Honolulu HI 1 ILPT Owned Land 326 100.0% 1,656 9,426 9,426 12/5/2003 — 850 Ahua Street Honolulu HI 1 ILPT Owned Land 48 100.0% 266 2,684 2,682 12/5/2003 — 852 Mapunapuna Street Honolulu HI 1 ILPT Owned Land 35 100.0% 279 1,801 1,801 12/5/2003 — 855 Ahua Street Honolulu HI 1 ILPT Owned Land 35 100.0% 215 1,834 1,834 12/5/2003 — CONSOLIDATED PROPERTY DETAIL (CONTINUED) DETAIL PROPERTY CONSOLIDATED 841 Mapunapuna Street Honolulu HI 1 ILPT Owned Land 63 100.0% 499 3,265 3,265 12/5/2003 — 865 Ahua Street Honolulu HI 1 ILPT Owned Land 36 100.0% 312 1,846 1,846 12/5/2003 — 889 Ahua Street Honolulu HI 1 ILPT Owned Land 49 100.0% 412 6,203 6,157 11/21/2012 — 905 Ahua Street Honolulu HI 1 ILPT Owned Land 21 100.0% 172 1,148 1,148 12/5/2003 — 918 Ahua Street Honolulu HI 1 ILPT Owned Land 72 100.0% 464 3,820 3,820 12/5/2003 — 930 Mapunapuna Street Honolulu HI 1 ILPT Owned Land 69 100.0% 517 3,654 3,654 12/5/2003 — 944 Ahua Street Honolulu HI 1 ILPT Owned Land 27 100.0% 207 1,219 1,219 12/5/2003 — 949 Mapunapuna Street Honolulu HI 1 ILPT Owned Land 237 100.0% 1,608 11,568 11,568 12/5/2003 — 950 Mapunapuna Street Honolulu HI 1 ILPT Owned Land 33 100.0% 262 1,724 1,724 12/5/2003 — (1) We define annualized rental revenues as the annualized contractual rents, as of September 30, 2018, including straight line rent adjustments and excluding lease value amortization, adjusted for tenant concessions including free rent and amounts reimbursed to tenants, plus estimated recurring expense reimbursements from tenants. (2) Excludes the value of real estate intangibles. (3) Date acquired is the date we acquired the property or the date our former parent entity acquired the property for those properties that our former parent entity contributed to us in February 2012 in connection with our IPO. Select Income REIT 55 Supplemental Operating and Financial Data, September 30, 2018
CONSOLIDATED PROPERTY DETAIL (CONTINUED) As of September 30, 2018 (dollars and square feet in thousands) EXHIBIT A Number of Year Buildings, Annualized Built or Land Parcels Rental Undepreciated Depreciated Date Most Recent Property City State and Easements Owner Property Type Square Feet % Leased Revenues (1) Carrying Value (2) Carrying Value (2) Acquired (3) Renovation 960 Ahua Street Honolulu HI 1 ILPT Owned Land 14 100.0% 120 614 614 12/5/2003 — 960 Mapunapuna Street Honolulu HI 1 ILPT Owned Land 37 100.0% 308 1,933 1,933 12/5/2003 — 970 Ahua Street Honolulu HI 1 ILPT Owned Land 15 100.0% 111 817 817 12/5/2003 — 91-008 Hanua Kapolei HI 1 SIR Owned Land 417 —% — 3,548 3,545 6/15/2005 — 91-027 Kaomi Loop Kapolei HI 1 ILPT Owned Land 214 —% — 2,667 2,667 6/15/2005 — 91-064 Kaomi Loop Kapolei HI 1 ILPT Owned Land 99 100.0% 323 1,826 1,826 6/15/2005 — 91-080 Hanua Kapolei HI 1 ILPT Owned Land 217 100.0% 508 2,187 2,187 6/15/2005 — 91-083 Hanua Kapolei HI 1 ILPT Owned Land 47 100.0% 127 716 716 6/15/2005 — 91-086 Kaomi Loop Kapolei HI 1 ILPT Owned Land 1,242 100.0% 1,809 13,884 13,884 6/15/2005 — 91-087 Hanua Kapolei HI 1 ILPT Owned Land 22 100.0% 69 381 381 6/15/2005 — 91-091 Hanua Kapolei HI 1 ILPT Owned Land 41 100.0% 156 552 552 6/15/2005 — 91-102 Kaomi Loop Kapolei HI 1 ILPT Owned Land 99 100.0% 252 1,599 1,599 6/15/2005 — 91-110 Kaomi Loop Kapolei HI 1 ILPT Owned Land 99 100.0% 234 1,293 1,293 6/15/2005 — 91-119 Olai Kapolei HI 1 ILPT Owned Land 98 100.0% 226 1,981 1,981 6/15/2005 — 91-210 Olai Kapolei HI 1 ILPT Owned Land 54 100.0% 206 706 706 6/15/2005 — 91-141 Kalaeloa Kapolei HI 1 ILPT Owned Land 910 100.0% 1,709 11,624 11,624 6/15/2005 — 91-150 Kaomi Loop Kapolei HI 1 ILPT Owned Land 250 100.0% 425 3,159 3,159 6/15/2005 — 91-171 Olai Kapolei HI 1 ILPT Owned Land 24 100.0% 53 265 254 6/15/2005 — 91-174 Olai Kapolei HI 1 ILPT Owned Land 58 100.0% 149 1,009 994 6/15/2005 — 91-175 Olai Kapolei HI 1 ILPT Owned Land 48 100.0% 95 1,286 1,269 6/15/2005 — 91-185 Kalaeloa Kapolei HI 1 ILPT Owned Land 122 100.0% 238 1,761 1,761 6/15/2005 — 91-202 Kalaeloa Kapolei HI 1 ILPT Owned Industrial 84 100.0% 376 2,048 2,005 6/15/2005 1,964 91-209 Kuhela Kapolei HI 1 SIR Owned Land 109 —% — 1,378 1,377 6/15/2005 0 91-210 Kauhi Kapolei HI 1 ILPT Owned Land 44 100.0% 125 567 567 6/15/2005 — 91-218 Olai Kapolei HI 1 ILPT Owned Land 107 100.0% 209 1,683 1,667 6/15/2005 — 91-220 Kalaeloa Kapolei HI 1 ILPT Owned Industrial 23 100.0% 317 1,871 1,345 6/15/2005 1,991 91-222 Olai Kapolei HI 1 ILPT Owned Land 158 100.0% 380 2,035 2,035 6/15/2005 0 91-238 Kauhi Kapolei HI 1 ILPT Owned Industrial 85 100.0% 1,334 10,599 8,051 6/15/2005 1,981 CONSOLIDATED PROPERTY DETAIL (CONTINUED) DETAIL PROPERTY CONSOLIDATED 91-241 Kalaeloa Kapolei HI 1 ILPT Owned Industrial 45 100.0% 651 5,247 3,707 6/15/2005 1990 91-250 Komohana Kapolei HI 1 ILPT Owned Land 107 100.0% 302 1,506 1,506 6/15/2005 0 91-252 Kauhi Kapolei HI 1 ILPT Owned Land 43 100.0% 106 536 536 6/15/2005 — 91-255 Hanua Kapolei HI 1 ILPT Owned Land 95 100.0% 220 1,274 1,245 6/15/2005 — 91-259 Olai Kapolei HI 1 ILPT Owned Land 131 100.0% 287 2,944 2,944 6/15/2005 — 91-265 Hanua Kapolei HI 1 ILPT Owned Land 95 100.0% 224 1,569 1,569 6/15/2005 — 91-300 Hanua Kapolei HI 1 ILPT Owned Land 107 100.0% 224 1,381 1,381 6/15/2005 — 91-329 Kauhi Kapolei HI 1 ILPT Owned Industrial 48 100.0% 816 4,971 3,657 6/15/2005 2,013 91-349 Kauhi Kapolei HI 1 ILPT Owned Land 48 100.0% 122 649 649 6/15/2005 0 (1) We define annualized rental revenues as the annualized contractual rents, as of September 30, 2018, including straight line rent adjustments and excluding lease value amortization, adjusted for tenant concessions including free rent and amounts reimbursed to tenants, plus estimated recurring expense reimbursements from tenants. (2) Excludes the value of real estate intangibles. (3) Date acquired is the date we acquired the property or the date our former parent entity acquired the property for those properties that our former parent entity contributed to us in February 2012 in connection with our IPO. Select Income REIT 56 Supplemental Operating and Financial Data, September 30, 2018
CONSOLIDATED PROPERTY DETAIL (CONTINUED) As of September 30, 2018 (dollars and square feet in thousands) EXHIBIT A Number of Year Buildings, Annualized Built or Land Parcels Rental Undepreciated Depreciated Date Most Recent Property City State and Easements Owner Property Type Square Feet % Leased Revenues (1) Carrying Value (2) Carrying Value (2) Acquired (3) Renovation 91-399 Kauhi Kapolei HI 1 ILPT Owned Land 2,236 100.0% 2,688 27,405 27,405 6/15/2005 — 91-400 Komohana Kapolei HI 1 ILPT Owned Land 96 100.0% 240 1,494 1,494 6/15/2005 — 91-410 Komohana Kapolei HI 1 ILPT Owned Land 21 100.0% 53 430 429 6/15/2005 — 91-416 Komohana Kapolei HI 1 ILPT Owned Land 27 100.0% 69 724 724 6/15/2005 — AES HI Easement Kapolei HI 1 ILPT Owned Land (4) — —% — 1,250 1,250 6/15/2005 — Other Easements & Lots Kapolei HI 1 ILPT Owned Land (4) — —% — 1,604 1,269 6/15/2005 — Tesaro 967 Easement Kapolei HI 1 ILPT Owned Land (4) (5) — —% — 6,593 6,593 6/15/2005 — Texaco Easement Kapolei HI 1 ILPT Owned Land (4) — —% — 2,653 2,653 6/15/2005 — 94-240 Pupuole Street Waipahu HI 1 ILPT Owned Land 44 100.0% 251 717 717 12/5/2003 — 5500 SE Delaware Avenue Ankeny IA 1 ILPT Owned Industrial 451 100.0% 1,682 19,193 17,636 1/29/2015 2,012 951 Trails Road Eldridge IA 1 ILPT Owned Industrial 173 100.0% 1,027 8,695 6,414 4/2/2007 2001 8305 NW 62nd Avenue Johnston IA 1 SIR Owned Office 199 100.0% 3,240 34,008 31,120 1/29/2015 2011 2300 North 33rd Avenue East Newton IA 1 ILPT Owned Industrial 318 100.0% 1,458 14,131 10,720 9/29/2008 2008 7121 South Fifth Avenue Pocatello ID 1 ILPT Owned Industrial 33 100.0% 370 4,746 4,355 1/29/2015 2007 400 South Jefferson Street Chicago IL 1 SIR Owned Office 248 100.0% 9,824 90,479 83,761 1/29/2015 2012 1230 West 171st Street Harvey IL 1 ILPT Owned Industrial 40 100.0% 442 2,473 2,320 1/29/2015 2004 475 Bond Street Lincolnshire IL 1 SIR Owned Industrial 223 100.0% 1,667 20,957 19,485 1/29/2015 2000 1415 West Diehl Road Naperville IL 1 SIR Owned Office 820 75.1% 14,521 188,475 168,819 4/1/2014 2001 5156 American Road Rockford IL 1 ILPT Owned Industrial 38 100.0% 173 1,929 1,789 1/29/2015 1996 440 North Fairway Drive Vernon Hills IL 1 SIR Owned Office 100 100.0% 1,687 13,977 12,742 10/15/2013 2009 7601 Genesys Way Indianapolis IN 1 SIR Owned Office 120 100.0% 1,878 12,253 11,937 7/19/2017 2003 7635 Genesys Way Indianapolis IN 1 SIR Owned Office 155 100.0% 2,423 16,238 15,819 7/19/2017 2008 400 SW 8th Avenue Topeka KS 1 SIR Owned Office 144 100.0% 2,639 17,674 15,165 7/30/2012 2006 1101 Pacific Avenue Erlanger KY 1 SIR Owned Office 86 100.0% 1,217 12,359 7,911 6/30/2003 1999 1061 Pacific Avenue Erlanger KY — SIR Owned Land — —% 72 732 732 6/30/2003 — 17200 Manchac Park Lane Baton Rouge LA 1 ILPT Owned Industrial 125 100.0% 889 10,560 9,748 1/29/2015 2,014 209 South Bud Street Lafayette LA 1 ILPT Owned Industrial 71 100.0% 374 5,258 4,841 1/29/2015 2010 300 Billerica Road Chelmsford MA 1 SIR Owned Office 111 100.0% 1,561 8,850 7,839 9/27/2012 2006 330 Billerica Road Chelmsford MA 1 SIR Owned Office 98 —% — 9,952 8,425 1/18/2011 1996 CONSOLIDATED PROPERTY DETAIL (CONTINUED) DETAIL PROPERTY CONSOLIDATED 111 Powdermill Road Maynard MA 1 SIR Owned Office 287 —% — 17,611 17,084 3/30/2007 1990 314 Littleton Road Westford MA 1 SIR Owned Office 175 100.0% 3,684 33,944 31,153 1/29/2015 2013 7001 Columbia Gateway Drive Columbia MD 1 SIR Owned Office 120 100.0% 3,741 28,292 24,757 12/21/2012 2008 4000 Principio Parkway North East MD 1 ILPT Owned Industrial 1,195 100.0% 5,908 76,350 69,783 1/29/2015 2012 16101 Queens Court Upper Marlboro MD 1 ILPT Owned Industrial 221 100.0% 1,826 27,130 27,130 9/28/2018 2016 3550 Green Court Ann Arbor MI 1 SIR Owned Office 82 100.0% 1,625 13,019 11,452 12/21/2012 1998 3800 Midlink Drive Kalamazoo MI 1 ILPT Owned Industrial 158 100.0% 2,184 43,229 39,507 1/29/2015 2014 2401 Cram Avenue SE Bemidji MN 1 ILPT Owned Industrial 22 100.0% 183 2,237 2,041 1/29/2015 2013 110 Stanbury Industrial Drive Brookfield MO 1 ILPT Owned Industrial 16 100.0% 190 2,059 1,889 1/29/2015 2012 (1) We define annualized rental revenues as the annualized contractual rents, as of September 30, 2018, including straight line rent adjustments and excluding lease value amortization, adjusted for tenant concessions including free rent and amounts reimbursed to tenants, plus estimated recurring expense reimbursements from tenants. (2) Excludes the value of real estate intangibles. (3) Date acquired is the date we acquired the property or the date our former parent entity acquired the property for those properties that our former parent entity contributed to us in February 2012 in connection with our IPO. (4) Land parcels include easements. (5) Excludes annual tenant percentage rent generally received and recognized during the first quarter of each year for the previous year. Percentage rent recognized during the first quarter of 2018 totaled $941. Select Income REIT 57 Supplemental Operating and Financial Data, September 30, 2018
CONSOLIDATED PROPERTY DETAIL (CONTINUED) As of September 30, 2018 (dollars and square feet in thousands) EXHIBIT A Number of Year Buildings, Annualized Built or Land Parcels Rental Undepreciated Depreciated Date Most Recent Property City State and Easements Owner Property Type Square Feet % Leased Revenues (1) Carrying Value (2) Carrying Value (2) Acquired (3) Renovation 2555 Grand Boulevard Kansas City MO 1 SIR Owned Office 596 100.0% 18,313 79,189 73,292 7/31/2015 2003 628 Patton Avenue Asheville NC 1 ILPT Owned Industrial 33 100.0% 203 2,014 1,875 1/29/2015 1994 2300 Yorkmont Road Charlotte NC 1 SIR Owned Office 151 100.0% 3,355 27,097 24,757 1/29/2015 1995 2400 Yorkmont Road Charlotte NC 1 SIR Owned Office 133 100.0% 2,910 22,997 20,960 1/29/2015 1995 3900 NE 6th Street Minot ND 1 ILPT Owned Industrial 24 100.0% 349 3,923 3,627 1/29/2015 2013 1415 West Commerce Way Lincoln NE 1 ILPT Owned Industrial 222 100.0% 1,094 10,718 9,937 1/29/2015 2000 18010 and 18020 Burt Street Omaha NE 2 SIR Owned Office 203 100.0% 3,988 49,842 45,511 1/29/2015 2012 309 Dulty's Lane Burlington NJ 1 ILPT Owned Industrial 634 100.0% 3,387 53,000 48,288 1/29/2015 2001 500 Charles Ewing Boulevard Ewing NJ 1 SIR Owned Office 250 100.0% 5,944 74,374 68,042 1/29/2015 2012 725 Darlington Avenue Mahwah NJ 1 ILPT Owned Industrial 167 100.0% 2,250 18,896 17,792 4/9/2014 2010 299 Jefferson Road Parsippany NJ 1 SIR Owned Office 151 100.0% 4,037 31,064 28,665 1/29/2015 2011 One Jefferson Road Parsippany NJ 1 SIR Owned Office 100 100.0% 4,194 19,157 18,068 11/13/2015 2009 2375 East Newlands Road Fernley NV 1 ILPT Owned Industrial 338 100.0% 1,473 18,700 17,080 1/29/2015 2007 55 Commerce Avenue Albany NY 1 ILPT Owned Industrial 125 100.0% 1,114 11,284 10,338 1/29/2015 2013 8687 Carling Road Liverpool NY 1 SIR Owned Office 38 100.0% 752 5,564 3,952 1/6/2006 2007 1212 Pittsford - Victor Road Pittsford NY 1 SIR Owned Office 55 100.0% 1,024 5,536 3,848 11/30/2004 2003 500 Canal View Boulevard Rochester NY 1 SIR Owned Office 95 17.9% 313 14,378 10,374 1/6/2006 1997 32150 Just Imagine Drive Avon OH 1 ILPT Owned Industrial 645 100.0% 3,479 25,480 20,048 5/29/2009 2000 1415 Industrial Drive Chillicothe OH 1 ILPT Owned Industrial 44 100.0% 362 4,465 4,166 1/29/2015 2012 2231 Schrock Road Columbus OH 1 SIR Owned Office 42 100.0% 707 5,627 5,188 1/29/2015 1999 5300 Centerpoint Parkway Groveport OH 1 ILPT Owned Industrial 581 100.0% 2,875 32,563 29,826 1/29/2015 2014 200 Orange Point Drive Lewis Center OH 1 ILPT Owned Industrial 125 100.0% 1,045 10,071 9,280 1/29/2015 2013 301 Commerce Drive South Point OH 1 ILPT Owned Industrial 75 100.0% 489 5,130 4,715 1/29/2015 2013 2820 State Highway 31 McAlester OK 1 ILPT Owned Industrial 59 100.0% 789 7,450 7,128 1/29/2015 2017 5 Logistics Drive Carlisle PA 1 ILPT Owned Industrial 205 100.0% 1,222 18,814 18,814 9/20/2018 2016 501 Ridge Avenue Hanover PA 1 SIR Owned Industrial 502 —% — 11,790 11,744 9/24/2008 1965 8800 Tinicum Boulevard Philadelphia PA 1 SIR Owned Office 441 100.0% 6,741 71,319 65,151 1/29/2015 2000 9680 Old Bailes Road Fort Mill SC 1 SIR Owned Office 60 100.0% 771 8,857 8,118 1/29/2015 2007 CONSOLIDATED PROPERTY DETAIL (CONTINUED) DETAIL PROPERTY CONSOLIDATED 996 Paragon Way Rock Hill SC 1 ILPT Owned Industrial 945 100.0% 3,054 38,520 35,227 1/29/2015 2014 510 John Dodd Road Spartanburg SC 1 ILPT Owned Industrial 1,016 100.0% 4,640 61,336 56,019 1/29/2015 2012 4836 Hickory Hill Road Memphis TN 1 ILPT Owned Industrial 646 100.0% 1,361 12,806 11,754 12/23/2014 2007 2020 Joe B. Jackson Parkway Murfreesboro TN 1 ILPT Owned Industrial 1,016 100.0% 4,998 62,759 57,694 1/29/2015 2012 16001 North Dallas Parkway Addison TX 2 SIR Owned Office 554 100.0% 14,012 106,559 92,956 1/16/2013 1996 2115-2116 East Randol Mill Road Arlington TX 1 SIR Owned Office 183 100.0% 1,043 13,242 11,792 1/29/2015 1989 Research Park-Cisco Building 3 Austin TX 1 SIR Owned Industrial 55 100.0% 1,149 5,859 3,447 6/16/1999 1999 Research Park-Cisco Building 4 Austin TX 1 SIR Owned Industrial 94 100.0% 1,877 9,780 5,784 6/16/1999 1999 1001 Noble Energy Way Houston TX 1 SIR Owned Office 497 100.0% 14,479 122,367 111,495 1/29/2015 2013 10451 Clay Road Houston TX 1 SIR Owned Office 97 100.0% 2,173 27,012 25,013 1/29/2015 2013 (1) We define annualized rental revenues as the annualized contractual rents, as of September 30, 2018, including straight line rent adjustments and excluding lease value amortization, adjusted for tenant concessions including free rent and amounts reimbursed to tenants, plus estimated recurring expense reimbursements from tenants. (2) Excludes the value of real estate intangibles. (3) Date acquired is the date we acquired the property or the date our former parent entity acquired the property for those properties that our former parent entity contributed to us in February 2012 in connection with our IPO. Select Income REIT 58 Supplemental Operating and Financial Data, September 30, 2018
CONSOLIDATED PROPERTY DETAIL (CONTINUED) As of September 30, 2018 (dollars and square feet in thousands) EXHIBIT A Number of Year Buildings, Annualized Built or Land Parcels Rental Undepreciated Depreciated Date Most Recent Property City State and Easements Owner Property Type Square Feet % Leased Revenues (1) Carrying Value (2) Carrying Value (2) Acquired (3) Renovation 202 North Castlegory Road Houston TX 1 SIR Owned Office 84 100.0% 2,865 13,482 13,036 5/12/2017 2016 6380 Rogerdale Road Houston TX 1 SIR Owned Office 206 100.0% 5,638 47,466 44,410 1/29/2015 2006 4221 W. John Carpenter Freeway Irving TX 1 SIR Owned Office 54 100.0% 798 5,607 3,081 3/19/1998 1995 8675,8701-8711 Freeport Pkwy and 8901 Esters Blvd Irving TX 3 SIR Owned Office 458 100.0% 6,038 81,610 75,256 1/29/2015 1990 1511 East Common Street New Braunfels TX 1 SIR Owned Office 63 100.0% 1,075 14,412 13,338 1/29/2015 2005 2900 West Plano Parkway Plano TX 1 SIR Owned Office 191 100.0% 1,420 27,491 25,448 1/29/2015 1998 3400 West Plano Parkway Plano TX 1 SIR Owned Office 235 100.0% 1,485 34,604 31,724 1/29/2015 1994 19100 Ridgewood Parkway San Antonio TX 1 SIR Owned Office 618 100.0% 13,809 192,661 175,431 1/29/2015 2008 3600 Wiseman Boulevard San Antonio TX 1 SIR Owned Office 100 100.0% 3,053 15,484 13,796 3/19/2013 2004 1800 Novell Place Provo UT 1 SIR Owned Office 406 100.0% 7,940 85,590 73,091 6/1/2012 2000 4885-4931 North 300 West Provo UT 2 SIR Owned Office 125 100.0% 3,678 29,338 25,717 2/28/2013 2009 1095 South 4800 West Salt Lake City UT 1 ILPT Owned Industrial 150 100.0% 1,071 8,413 7,779 1/29/2015 2012 1901 Meadowville Technology Parkway Chester VA 1 ILPT Owned Industrial 1,016 100.0% 6,283 71,511 65,323 1/29/2015 2012 Two Commercial Place Norfolk VA 1 SIR Owned Office 289 100.0% 5,561 37,018 35,867 4/28/2017 2016 1910 East Parham Road Richmond VA 1 SIR Owned Office 29 100.0% 441 3,152 2,964 7/20/2015 2014 1920 East Parham Road Richmond VA 1 SIR Owned Office 34 100.0% 565 3,870 3,642 7/20/2015 2014 1950 East Parham Road Richmond VA 1 SIR Owned Office 26 100.0% 543 2,855 2,685 7/20/2015 2012 501 South 5th Street Richmond VA 1 SIR Owned Office 311 100.0% 12,295 123,926 109,499 7/2/2013 2009 9201 Forest Hill Avenue Richmond VA 1 SIR Owned Office 50 100.0% 1,078 6,239 5,998 10/12/2016 1985 1751 Blue Hills Drive Roanoke VA 1 SIR Owned Industrial 399 100.0% 1,874 23,760 21,907 1/29/2015 2003 45101 Warp Drive Sterling VA 1 SIR Owned Office 161 100.0% 4,892 34,298 29,931 11/29/2012 2001 45201 Warp Drive Sterling VA 1 SIR Owned Office 88 100.0% 2,744 18,933 16,571 11/29/2012 2000 45301 Warp Drive Sterling VA 1 SIR Owned Office 88 100.0% 2,738 18,933 16,581 11/29/2012 2000 181 Battaile Drive Winchester VA 1 ILPT Owned Industrial 308 100.0% 1,467 14,352 10,346 4/20/2006 1987 351, 401, 501 Elliott Ave West Seattle WA 3 SIR Owned Office 300 100.0% 13,685 130,811 122,098 1/29/2015 2000 368 45,754 95.8% $ 476,216 $ 4,311,196 $ 3,941,895 CONSOLIDATED PROPERTY DETAIL (CONTINUED) DETAIL PROPERTY CONSOLIDATED SIR (excluding ILPT) 99 16,538 89.8% $ 312,768 $ 2,876,782 $ 2,595,759 ILPT 269 29,216 99.3% 163,448 1,434,414 1,346,136 Total 368 45,754 95.8% $ 476,216 $ 4,311,196 $ 3,941,895 (1) We define annualized rental revenues as the annualized contractual rents, as of September 30, 2018, including straight line rent adjustments and excluding lease value amortization, adjusted for tenant concessions including free rent and amounts reimbursed to tenants, plus estimated recurring expense reimbursements from tenants. (2) Excludes the value of real estate intangibles. (3) Date acquired is the date we acquired the property or the date our former parent entity acquired the property for those properties that our former parent entity contributed to us in February 2012 in connection with our IPO. Select Income REIT 59 Supplemental Operating and Financial Data, September 30, 2018
