8-K

  UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT PURSUANT

TO SECTION 13 or 15(d) OF THE

SECURITIES EXCHANGE ACT of 1934

Date of report (Date of earliest event reported): November 6, 2019

Tremont Mortgage Trust

(Exact Name of Registrant as Specified in Its Charter)

Maryland

(State or other Jurisdiction of Incorporation)

001-38199	82-1719041
(Commission File Number)	(IRS Employer Identification Number)

Two Newton Place, 255 Washington Street, Suite 300,

Newton, Massachusetts                    02458-1634

(Address of Principal Executive Offices)                 (Zip Code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol	Name of each exchange on which registered
Common Shares of Beneficial Interest	TRMT	The Nasdaq Stock Market LLC

 (617) 796-8317

(Registrant’s Telephone Number, Including Area Code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:  

☐             Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐             Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐             Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐             Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

Item 2.02.  Results of Operations and Financial Condition.

On November 6, 2019, Tremont Mortgage Trust, or the Company, issued a press release regarding the Company’s results of operations and financial condition for the quarter and nine months ended September 30, 2019 and also provided certain supplemental operating and financial data for the quarter and nine months ended September 30, 2019. Copies of the Company’s press release and supplemental operating and financial data are furnished as Exhibits 99.1 and 99.2 hereto, respectively.

Item 9.01.  Financial Statements and Exhibits.

(d)          Exhibits

99.1 Press release dated November 6, 2019

99.2 Third Quarter 2019 Supplemental Operating and Financial Data

104 Cover Page Interactive Data File (embedded within the inline XBRL document)

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

		TREMONT MORTGAGE TRUST
Date:	November 6, 2019	By:	/s/ G. Douglas Lanois
		Name:	G. Douglas Lanois
		Title:	Chief Financial Officer and Treasurer

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EX-99.1

Exhibit 99.1

FOR IMMEDIATE RELEASE

Contact:

Christopher Ranjitkar

Senior Director, Investor Relations

(617) 796-7651

Tremont Mortgage Trust Announces Third Quarter 2019 Results

Loan Repayments of $53.6 Million During the Third Quarter

Third Quarter Net Income Per Diluted Share of $0.25

Third Quarter Core Earnings Per Diluted Share of $0.26

Quarterly Distribution Declared in October of $0.22 Per Common Share

_______________________________________________________________

Newton, MA (November 6, 2019): Tremont Mortgage Trust (Nasdaq: TRMT) today announced financial results for the quarter and nine months ended September 30, 2019.

David Blackman, President and Chief Executive Officer of TRMT, made the following statement:

“Our third quarter results reflect the early repayment of $53.6 million of loans from two borrowers. This demonstrates the strong credit quality of our borrowers and validates our Manager's ability to source high quality loans. At this time, our focus is on redeploying this repayment capital and asset managing our book of loans.”

Results for the Quarter Ended September 30, 2019:

For the quarter ended September 30, 2019, net income was $2.1 million, or $0.25 per diluted share, compared to a net loss of $0.1 million, or $0.02 per diluted share, for the same quarter last year. Core Earnings for the quarter ended September 30, 2019 were $2.1 million, or $0.26 per diluted share, compared to Core Earnings of $0.1 million, or $0.02 per diluted share, for the same quarter last year.

For the quarter ended September 30, 2019, TRMT generated interest income of $5.0 million, including $0.9 million of deferred fees recognized by TRMT on the two loans that were repaid during the quarter as well as a prepayment premium earned on one of these repaid loans. TRMT incurred interest and related expenses of $2.0 million for the quarter ended September 30, 2019, which resulted in $3.0 million of income from investments, net. For the same quarter last year, TRMT generated interest income of $1.4 million and interest and related expenses of $0.6 million, which resulted in $0.8 million of income from investments, net.

Results for the Nine Months Ended September 30, 2019:

For the nine months ended September 30, 2019, net income was $3.5 million, or $0.63 per diluted share, compared to a net loss of $1.8 million, or $0.57 per diluted share, for the same period last year. Core Earnings for the nine months ended September 30, 2019 were $3.8 million, or $0.69 per diluted share, compared to a Core Loss of $1.4 million, or $0.46 per diluted share, for the same period last year.

For the nine months ended September 30, 2019, TRMT generated interest income of $11.9 million, including $0.9 million of deferred fees recognized by TRMT on the two loans that were repaid during the quarter as well as a prepayment premium earned on one of these repaid loans. TRMT incurred interest and related expenses of $5.6 million for the nine months ended September 30, 2019, which resulted in $6.3 million of income from

investments, net. For the same period last year, TRMT generated interest income of $2.1 million and interest and related expenses of $0.7 million, which resulted in $1.4 million of income from investments, net.

Additional information and a reconciliation of net income (loss) determined in accordance with U.S. generally accepted accounting principles, or GAAP, to Core Earnings (Loss), a non-GAAP financial measure, for the quarters and nine months ended September 30, 2019 and 2018, appear later in this press release.

Recent Investment Activities:

In August 2019, TRMT received $39.9 million of repayment proceeds from the borrower on its loan held for investment that was used to finance the acquisition of the Hampton Inn JFK located in Queens, NY, or the JFK loan, which included the $39.6 million of principal outstanding under the loan, as well as the accrued interest, an exit fee and TRMT’s associated legal expenses. TRMT was required to use $31.8 million of these repayment proceeds to repay the outstanding balance and accrued interest under its note payable with Texas Capital Bank, National Association, or the TCB note payable, associated with the JFK loan. TRMT used the remaining proceeds to pay down balances under its master repurchase facility with Citibank N.A., or the Master Repurchase Facility.

Also in August 2019, TRMT received $14.6 million of repayment proceeds from the borrower on its loan held for investment that was used to refinance an office building located in Scarsdale, NY, which included the $14.0 million of principal outstanding under the loan, as well as the accrued interest, an exit fee, a prepayment premium and TRMT’s associated legal expenses. TRMT was required to use $10.4 million of these repayment proceeds to repay the outstanding balance and accrued interest under the Master Repurchase Facility associated with this loan, and TRMT used the remaining proceeds to pay down additional balances under the Master Repurchase Facility.

In September 2019, TRMT entered into a loan application with a borrower for a first mortgage bridge whole loan with a total commitment of $22.6 million to refinance an office portfolio located in Dublin, OH.

In October 2019, TRMT entered into a loan application with a borrower for a first mortgage bridge whole loan with a total commitment of $18.0 million to refinance a student housing property located in Orono, ME.

Recent Financing Activities:

During the quarter ended September 30, 2019, TRMT repaid the $31.7 million outstanding principal balance under the TCB note payable and $22.4 million of outstanding principal balances under the Master Repurchase Facility with the repayment proceeds noted above, and the TCB note payable was terminated in accordance with its terms. At September 30, 2019, TRMT had $24.2 million available for immediate advancement under the Master Repurchase Facility, with an additional $58.0 million of unused capacity.

Distributions:

On August 15, 2019, TRMT paid a regular quarterly distribution to common shareholders of record as of July 29, 2019 of $0.22 per common share, or $1.8 million.

On October 17, 2019, TRMT declared a regular quarterly distribution to common shareholders of record as of October 28, 2019 of $0.22 per common share, or approximately $1.8 million. TRMT expects to pay this distribution on or about November 14, 2019.

Conference Call:

At 10:00 a.m. Eastern Time this morning, President and Chief Executive Officer, David Blackman, and Chief Financial Officer and Treasurer, Doug Lanois, will host a conference call to discuss TRMT’s third quarter 2019 financial results. The conference call telephone number is (833) 366-1119. Participants calling from outside the United States and Canada should dial (412) 902-6771. No pass code is necessary to access the call from either number. Participants should dial in about 15 minutes prior to the scheduled start of the call. A replay of the conference call will be available through 11:59 p.m. on Wednesday, November 13, 2019. To access the replay, dial (412) 317-0088. The replay pass code is 10134922.

A live audio webcast of the conference call will also be available in a listen-only mode on TRMT’s website, which is located at www.trmtreit.com. Participants wanting to access the webcast should visit TRMT’s website about five minutes before the call. The archived webcast will be available for replay on TRMT’s website following

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the call for about one week. The transcription, recording and retransmission in any way of TRMT’s third quarter conference call are strictly prohibited without the prior written consent of TRMT.

Supplemental Data:

A copy of TRMT’s Third Quarter 2019 Supplemental Operating and Financial Data is available for download at TRMT’s website, www.trmtreit.com. TRMT’s website is not incorporated as part of this press release.

TRMT is a real estate finance company that focuses primarily on originating and investing in floating rate first mortgage whole loans secured by middle market and transitional commercial real estate. TRMT is managed by Tremont Realty Advisors LLC, a Securities and Exchange Commission, or SEC, registered investment adviser and an indirect, majority-owned subsidiary of The RMR Group Inc. (Nasdaq: RMR), an alternative asset management company that is headquartered in Newton, MA.

Non-GAAP Financial Measures:

TRMT presents Core Earnings (Loss) which is considered a “non-GAAP financial measure” within the meaning of the applicable SEC rules. Core Earnings (Loss) does not represent net income (loss) or cash generated from operating activities and should not be considered as an alternative to net income (loss) determined in accordance with GAAP or an indication of TRMT's cash flows from operations determined in accordance with GAAP, a measure of TRMT's liquidity or operating performance or an indication of funds available for TRMT's cash needs. In addition, TRMT's methodology for calculating Core Earnings (Loss) may differ from the methodologies employed by other companies to calculate the same or similar supplemental performance measures; therefore, TRMT's reported Core Earnings (Loss) may not be comparable to the core earnings as reported by other companies.

TRMT believes that Core Earnings (Loss) provides meaningful information to consider in addition to net income and cash flows from operating activities determined in accordance with GAAP. This measure helps TRMT to evaluate its performance excluding the effects of certain transactions and GAAP adjustments that TRMT believes are not necessarily indicative of TRMT's current loan portfolio and operations. In addition, Core Earnings (Loss) is used in determining the amount of business management and incentive fees payable by TRMT to TRMT's manager under TRMT's management agreement.

Please see the pages attached hereto for a more detailed statement of TRMT’s operating results and financial condition and for an explanation of TRMT’s calculation of Core Earnings (Loss) and a reconciliation of net income (loss) determined in accordance with GAAP to that amount.

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TREMONT MORTGAGE TRUST

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(amounts in thousands, except per share data)

(unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
INCOME FROM INVESTMENTS:
Interest income from investments	$	4,959		$	1,385		$	11,872		$	2,113
Less: interest and related expenses	(1,992		)	(563		)	(5,572		)	(666		)
Income from investments, net	2,967			822			6,300			1,447
OTHER EXPENSES:
Management fees (1)	—			—			—			447
General and administrative expenses	541			510			1,662			1,668
Reimbursement of shared services expenses	370			375			1,110			1,125
Total expenses	911			885			2,772			3,240
Net income (loss)	$	2,056		$	(63	)	$	3,528		$	(1,793	)
Weighted average common shares outstanding - basic and diluted	8,156			3,129			5,583			3,121
Net income (loss) per common share - basic and diluted	$	0.25		$	(0.02	)	$	0.63		$	(0.57	)

⁽¹⁾  In June 2018, TRMT's manager agreed to waive any base management fees otherwise due and payable pursuant to TRMT's management agreement for the period beginning July 1, 2018 until June 30, 2020. As a result, TRMT did not recognize any base management fees for the three or nine months ended September 30, 2019 or the three months ended September 30, 2018. If TRMT's manager had not agreed to waive these base management fees, TRMT would have recognized base management fees of $322 and $812 for the three and nine months ended September 30, 2019, respectively, and $222 for the three months ended September 30, 2018, which would have resulted in TRMT recognizing $669 of total base management fees for the nine months ended September 30, 2018 (including the $447 of business management fees actually recognized).

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TREMONT MORTGAGE TRUST

CALCULATION AND RECONCILIATION OF CORE EARNINGS (LOSS)

(amounts in thousands, except per share data)

(unaudited)

	Three Months Ended September 30,					Nine Months Ended September 30,
	2019		2018			2019		2018
Reconciliation of Net Income (Loss) to Core Earnings (Loss) (1):
Net income (loss)	$	2,056	$	(63	)	$	3,528	$	(1,793	)
Non-cash equity compensation expense	80		118			300		349
Core Earnings (Loss)	$	2,136	$	55		$	3,828	$	(1,444	)
Weighted average common shares outstanding - basic and diluted	8,156		3,129			5,583		3,121
Core Earnings (Loss) per common share - basic and diluted	$	0.26	$	0.02		$	0.69	$	(0.46	)

⁽¹⁾  TRMT calculates Core Earnings (Loss) as net income (loss), computed in accordance with GAAP, including realized losses not otherwise included in net income (loss) determined in accordance with GAAP, and excluding: (a) the incentive fees earned by TRMT's manager (if any); (b) depreciation and amortization (if any); (c) non-cash equity compensation expense; (d) unrealized gains (losses) and other similar non-cash items that are included in net income (loss) for the period of the calculation (regardless of whether such items are included in or deducted from net income (loss) or in other comprehensive income (loss) under GAAP) (if any); and (e) one time events pursuant to changes in GAAP and certain non-cash items (if any).

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TREMONT MORTGAGE TRUST

CONDENSED CONSOLIDATED BALANCE SHEETS

(dollars in thousands, except per share data)

(unaudited)

	September 30,			December 31,
	2019			2018
ASSETS
Cash and cash equivalents	$	9,244		$	27,024
Restricted cash	110			311
Loans held for investment, net	207,464			135,844
Accrued interest receivable	711			344
Prepaid expenses and other assets	254			390
Total assets	$	217,783		$	163,913
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable, accrued liabilities and deposits	$	759		$	935
Master repurchase facility, net	130,312			71,691
Note payable, net	—			31,485
Due to related persons	33			134
Total liabilities	131,104			104,245
Commitments and contingencies
Shareholders' equity:
Common shares of beneficial interest, $0.01 par value per share; 25,000,000 shares authorized; 8,240,057 and 3,178,817 shares issued and outstanding, respectively	82			32
Additional paid in capital	88,827			62,540
Cumulative net income (loss)	624			(2,904		)
Cumulative distributions	(2,854		)	—
Total shareholders’ equity	86,679			59,668
Total liabilities and shareholders' equity	$	217,783		$	163,913

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Warning Concerning Forward-Looking Statements

This press release 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 TRMT uses words such as “believe”, “expect”, “anticipate”, “intend”, “plan”, “estimate”, “will”, “may” and negatives or derivatives of these or similar expressions, TRMT is making forward-looking statements. These forward-looking statements are based upon TRMT’s present intent, beliefs or expectations, but forward-looking statements are not guaranteed to occur and may not occur. Actual results may differ materially from those contained in or implied by TRMT’s forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and other factors, some of which are beyond TRMT's control. For example:

• This press release states that TRMT has declared a regular quarterly distribution of $0.22 per common share. This statement may imply that TRMT will continue to make regular quarterly distributions of $0.22 per common share. The timing, amount and form of any future distributions will be determined at the discretion of TRMT's Board of Trustees and will depend upon various factors that TRMT's Board of Trustees deems relevant, including TRMT's historical and projected income, Core Earnings, the then current and expected needs and availability of cash to pay its obligations and fund its investments, distributions which may be required to be paid by TRMT to maintain its qualification for taxation as a real estate investment trust, limitations on distributions contained in TRMT’s financing arrangements and other factors deemed relevant by TRMT's Board of Trustees in its discretion. Therefore, TRMT cannot be sure that it will continue to pay distributions in the future or that the amount of any distributions TRMT does pay will not decrease.

• Mr. Blackman states that the recent early loan repayments demonstrate the strong credit quality of TRMT's borrowers and validates TRMT's Manager's ability to source high quality loans, and that TRMT's current focus is on redeploying its repayment capital and asset managing its book of loans. These statements may imply that TRMT's borrowers will continue to have strong credit qualities and that TRMT will continue to be able to source high quality loans for its business in the future. However, TRMT’s business is subject to various risks, including the competitive nature of the industry in which it operates. As a result, the credit qualities of TRMT's current and future borrowers may decline and TRMT may be unable to successfully redeploy its current repayment capital in new investments that provide similar returns at comparable risk. In addition, TRMT's investments are subject to various risks, some of which are beyond its control, including that borrowers may default on their payment obligations or TRMT may receive additional repayment capital that it is unable to successfully redeploy.

• TRMT's pending and prospective loans and applications may not be completed or become loans, may be delayed or their terms may change.

The information contained in TRMT’s filings with the SEC, including under “Risk Factors” in TRMT’s periodic reports, or incorporated therein, identifies other important factors that could cause TRMT’s actual results to differ materially from those stated in or implied by TRMT’s forward-looking statements. TRMT’s filings with the SEC are available on the SEC's website at www.sec.gov.

You should not place undue reliance upon forward-looking statements.

Except as required by law, TRMT does not intend to update or change any forward-looking statements as a result of new information, future events or otherwise.

(END)

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EX-99.2

Exhibit 99.2 TREMONT MORTGAGE TRUST TRMT Nasdaq Listed Third Quarter 2019 Supplemental Operating and Financial Data 1711 Caroline Street, Houston, TX $28.0 Million First Mortgage Whole Loan Tremont Mortgage Trust Confidential Supplemental Operating and Financial Data, September 30, 2019All amounts in this report are unaudited 1

TABLE OF CONTENTS CORPORATE INFORMATION Page Company Profile 4 Investor Information 5 Research Coverage 6 Key Definitions 7 TABLE OF CONTENTS TABLE FINANCIALS Third Quarter 2019 Highlights 9 Condensed Consolidated Balance Sheets 10 Condensed Consolidated Statements of Operations 11 Condensed Consolidated Statements of Cash Flows 12 Debt Summary 14 Reconciliation of Net Income (Loss) to Core Earnings (Loss) 15 PORTFOLIO OVERVIEW Third Quarter 2019 Portfolio Summary 17 Loan Investment Details 18 Loan Portfolio Diversification 19 Interest Rate Sensitivity 20 Capital Structure Overview 21 WARNING CONCERNING FORWARD-LOOKING STATEMENTS 22 Tremont Mortgage Trust ConfidentialSupplemental Operating and Financial Data, September 30, 2019 2

CORPORATE INFORMATION Barrington Business Center 1 Commerce Drive, Barrington, NJ $37.6 Million First Mortgage Whole Loan ‹#›

COMPANY PROFILE The Company: Tremont Mortgage Trust, or TRMT, we, our or us, is a real estate investment trust, or REIT, that focuses on originating and investing in floating Corporate Headquarters: rate first mortgage whole loans secured by middle market and transitional commercial real estate, or CRE. We define middle market CRE as Two Newton Place commercial properties that have values up to $75.0 million and transitional CRE as commercial properties subject to redevelopment or 255 Washington Street, Suite 300 repositioning activities that are expected to increase the value of the properties. Newton, MA 02458-1634 (617) 796-8317 Management: Our Manager, Tremont Realty Advisors LLC, is registered with the Securities and Exchange Commission, or SEC, as an investment adviser Stock Exchange Listing: and is owned by The RMR Group LLC, or RMR LLC, the majority owned operating subsidiary of The RMR Group Inc., or RMR Inc., a holding Nasdaq COMPANY PROFILE COMPANY company listed on The Nasdaq Stock Market LLC, or Nasdaq, under the symbol “RMR”. We collectively refer to RMR Inc. and its consolidated subsidiaries, including RMR LLC, as RMR. Trading Symbol: RMR is an alternative asset management company that was founded in 1986 to manage real estate companies and related businesses. RMR Common Shares: TRMT primarily provides management services to four publicly traded equity REITs and three real estate related operating businesses. In addition to managing TRMT, RMR manages Service Properties Trust (formerly known as Hospitality Properties Trust), a REIT that owns a diverse portfolio of hotels and net lease service and necessity-based retail properties, Industrial Logistics Properties Trust, a REIT that owns industrial and Key Data (as of and for the three months logistics properties, Office Properties Income Trust, a REIT that owns buildings primarily leased to single tenants and those with high credit ended September 30, 2019): quality characteristics such as government entities, and Senior Housing Properties Trust, a REIT that primarily owns healthcare, senior living (dollars in 000s) and medical office buildings. RMR also provides management services to Five Star Senior Living Inc., a publicly traded operator of senior living communities, Sonesta International Hotels Corporation, a privately owned operator and franchisor of hotels and cruise boats, and TravelCenters Q3 2019 income from of America LLC, a publicly traded operator and franchisor of travel centers along the U.S. Interstate Highway System, standalone truck services investments, net $ 2,967 facilities and restaurants. RMR also advises the RMR Real Estate Income Fund, a publicly traded closed end fund that invests in publicly traded Q3 2019 net income $ 2,056 securities of real estate companies, through a wholly owned SEC registered investment advisory subsidiary, as well as manages the RMR Q3 2019 Core Earnings (1) $ 2,136 Office Property Fund, a private, open end core plus fund focused on the acquisition, ownership and leasing of a diverse portfolio of multi-tenant office properties throughout the U.S. As of September 30, 2019, RMR had $32.8 billion of real estate assets under management and the Loans held for investment, net $ 207,464 combined RMR managed companies had approximately $12 billion of annual revenues, over 2,200 properties and nearly 50,000 employees. Total Assets $ 217,783 We believe our Manager’s relationship with RMR provides us with a depth of market knowledge that may allow us to identify more investment opportunities and to evaluate them more thoroughly than many of our competitors, including other commercial mortgage REITs. We also believe (1) RMR’s broad platform provides us with access to RMR’s extensive network of real estate owners, operators, intermediaries, sponsors, financial See Key Definitions on page 7 for a definition of Core Earnings (Loss), a description of why we believe it's institutions and other real estate related professionals and businesses with which RMR has historical relationships. We also believe that our an appropriate supplemental measure and a Manager provides us with significant experience and expertise in investing in investments in middle market and transitional CRE. description of how we use this measure. See page 15 for the calculation of Core Earnings (Loss) and a reconciliation of net income (loss) determined in accordance with U.S. generally accepted accounting principles, or GAAP, to this amount. Tremont Mortgage Trust ConfidentialSupplemental Operating and Financial Data, September 30, 2019 4

INVESTOR INFORMATION Board of Trustees John L. Harrington Joseph L. Morea 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 G. Douglas Lanois President and Chief Executive Officer Chief Financial Officer and Treasurer Contact Information Investor Relations Inquiries Tremont Mortgage Trust Financial inquiries should be directed to Two Newton Place G. Douglas Lanois, Chief Financial Officer and Treasurer, 255 Washington Street, Suite 300 at (617) 658-0755 or dlanois@tremontadv.com Newton, MA 02458-1634 (617) 796-7651 Investor and media inquiries should be directed to cranjitkar@trmtreit.com Christopher Ranjitkar, Senior Director, Investor Relations, www.trmtreit.com at (617) 796-7651 or cranjitkar@trmtreit.com Tremont Mortgage Trust ConfidentialSupplemental Operating and Financial Data, September 30, 2019 5

RESEARCH COVERAGE Equity Research Coverage UBS Securities, LLC Citibank Global Markets, Inc Brock Vandervliet Arren Cyganovich, CFA RESEARCH COVERAGE (212) 713-2382 (212) 816-3733 brock.vandervliet@ubs.com arren.cyganovich@citi.com JMP Securities, LLC Steven C. Delaney (212) 906-3517 sdelaney@jmpsecurities.com TRMT is followed by the analysts listed above. Please note that any opinions, estimates or forecasts regarding TRMT’s performance made by these analysts do not represent opinions, forecasts or predictions of TRMT or its management. TRMT does not by its reference above imply its endorsement of or concurrence with any information, conclusions or recommendations provided by any of these analysts. Tremont Mortgage Trust ConfidentialSupplemental Operating and Financial Data, September 30, 2019 6

KEY DEFINITIONS Non-GAAP Financial Measures: We present Core Earnings (Loss) which is considered a “non-GAAP financial measure” within the meaning of the applicable SEC rules. Core Earnings (Loss) does not represent net income (loss) or cash generated from operating activities and should not be considered as an alternative to net income (loss) determined in accordance with GAAP or an indication of our cash flows from operations determined in accordance with GAAP, a measure of our liquidity or operating performance or an indication of funds available for our cash needs. In addition, our methodology for calculating Core Earnings (Loss) may differ from the methodologies employed by other companies to calculate the same or similar supplemental performance measures; therefore, our reported Core Earnings (Loss) may not be comparable to the core earnings as reported by other companies. We believe that Core Earnings (Loss) provides meaningful information to consider in addition to net income and cash flows from operating activities determined in accordance with KEY DEFINITIONS KEY GAAP. This measure helps us to evaluate our performance excluding the effects of certain transactions and GAAP adjustments that we believe are not necessarily indicative of our current loan portfolio and operations. In addition, Core Earnings (Loss) is used in determining the amount of business management and incentive fees payable by us to our Manager under our management agreement. Core Earnings (Loss) We calculate Core Earnings (Loss) as net income (loss), computed in accordance with GAAP, including realized losses not otherwise included in net income (loss) determined in accordance with GAAP, and excluding: (a) the incentive fees earned by our Manager (if any); (b) depreciation and amortization (if any); (c) non-cash equity compensation expense; (d) unrealized gains, losses and other similar non-cash items that are included in net income (loss) for the period of the calculation (regardless of whether such items are included in or deducted from net income (loss) or in other comprehensive income (loss) under GAAP) (if any); and (e) one time events pursuant to changes in GAAP and certain non-cash items (if any). Other Measures: All in yield: All in yield is inclusive of the amortization of deferred fees over the initial term of the loan. Maximum Maturity: Maximum maturity assumes all extension options are exercised, which options are subject to the borrower meeting certain conditions. LTV: Loan to Value Ratio, or LTV, represents the initial loan amount divided by the underwritten in-place value at closing. Tremont Mortgage Trust ConfidentialSupplemental Operating and Financial Data, September 30, 2019 7

FINANCIALS West Park I, St. Louis, MO Part of West Park I, West Park II and Pine View Point Office Portfolio $29.5 Million First Mortgage Whole Loan ‹#›

THIRD QUARTER 2019 HIGHLIGHTS (1) • Net income and Core Earnings(2) of $2.1 million, or $0.25 and $0.26 per diluted common share, respectively. • Income from investments, net, of $3.0 million. Financial Results • Book value per common share of $10.52. • Distribution of $0.22 per common share distribution declared October 2019 and payable November 2019. • Ten first mortgage whole loans diversified among office, retail, multifamily, industrial and hotel collateral, with an aggregate loan commitment of $227.2 million. (2) Loan Portfolio • Weighted average maturity of 3.6 years based on maximum maturities . • Weighted average coupon of 5.85% and all in yield(2) of 6.51%. • Two loans with an aggregate principal balance of $53.6 million were repaid during the quarter. • $24.2 million available for immediate advancement under our master repurchase facility with Citibank, N.A., or our Master Repurchase Facility with an additional $58.0 million unused capacity. • Repaid $22.4 million under the Master Repurchase Facility with the proceeds of borrower repayments. Capitalization THIRD QUARTER 2019 HIGHLIGHTS • Repaid $31.7 million principal balance outstanding under our term loan with Texas Capital Bank, National Association, with the repayment proceeds related to our loan held for investment associated with a hotel located in Queens, NY. • In place leverage of $131.3 million. • All loans held for investment have floating interest rates and borrowers have required hedging instruments to mitigate interest rate risk. Interest Rates • Secured borrowings subject to floating interest rates. • Floating rate assets and floating rate liabilities support earnings stability. (1) As of September 30, 2019, unless otherwise stated. (2) See Key Definitions on page 7 for definitions of Core Earnings, maximum maturity and all in yield. Tremont Mortgage Trust ConfidentialSupplemental Operating and Financial Data, September 30, 2019 9

CONDENSED CONSOLIDATED BALANCE SHEETS (dollars in thousands, except per share data) September 30, December 31, 2019 2018 ASSETS Cash and cash equivalents $ 9,244 $ 27,024 Restricted cash 110 311 Loans held for investment, net 207,464 135,844 Accrued interest receivable 711 344 Prepaid expenses and other assets 254 390 Total assets $ 217,783 $ 163,913 LIABILITIES AND SHAREHOLDERS' EQUITY FinancialAccounts payable, accrued liabilities and deposits $ 759 $ 935 Master repurchase facility, net 130,312 71,691 Note payable, net — 31,485 SummaryDue to related persons 33 134 Total liabilities 131,104 104,245 Commitments and contingencies Shareholders' equity: Common shares of beneficial interest, $0.01 par value per share; 25,000,000 shares authorized; 8,240,057 and 3,178,817 shares issued and outstanding, respectively 82 32 CONDENSED CONSOLIDATED BALANCE SHEETS CONDENSED CONSOLIDATED Additional paid in capital 88,827 62,540 Cumulative net income (loss) 624 (2,904) Cumulative distributions (2,854) — Total shareholders’ equity 86,679 59,668 Total liabilities and shareholders' equity $ 217,783 $ 163,913 Tremont Mortgage Trust ConfidentialSupplemental Operating and Financial Data, September 30, 2019 10

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (amounts in thousands, except per share data) Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 INCOME FROM INVESTMENTS: Interest income from investments $ 4,959 $ 1,385 $ 11,872 $ 2,113 Less: interest and related expenses (1,992) (563) (5,572) (666) Income from investments, net 2,967 822 6,300 1,447 OTHER EXPENSES: Management fees (1) — — — 447 General and administrative expenses 541 510 1,662 1,668 Reimbursement of shared services expenses 370 375 1,110 1,125 Total expenses 911 885 2,772 3,240 Net income (loss) $ 2,056 $ (63) $ 3,528 $ (1,793) Weighted average common shares outstanding - basic and diluted 8,156 3,129 5,583 3,121 Net income (loss) per common share - basic and diluted $ 0.25 $ (0.02) $ 0.63 $ (0.57) (1) In June 2018, our Manager agreed to waive any base management fees otherwise due and payable pursuant to our management agreement for the period beginning July 1, 2018 until June 30, 2020. As a result, we did not recognize any base management fees for the three or nine months ended September 30, 2019 or the three months ended September 30, 2018. If our Manager had not agreed to waive these base management fees, we would have recognized base management fees of $322 and $812 for the three and nine months ended September 30, 2019, respectively, and $222 for the three months ended September 30, 2018, which would have resulted in our recognizing $669 of total base management fees for the nine months ended September 30, 2018 (including the $447 of business management fees actually recognized). CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS STATEMENTS CONDENSED CONSOLIDATED Tremont Mortgage Trust ConfidentialSupplemental Operating and Financial Data, September 30, 2019 11

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (dollars in thousands) For the Nine Months Ended September 30, 2019 2018 CASH FLOWS FROM OPERATING ACTIVITIES: Net income (loss) $ 3,528 $ (1,793) Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: Share based compensation 300 349 Amortization of deferred financing costs 502 184 Amortization of loan origination and exit fees (1,333) (145) Changes in operating assets and liabilities: Accrued interest receivable (367) (293) Prepaid expenses and other assets 136 5 FinancialAccounts payable, accrued liabilities and deposits (176) 275 Due to related persons (101) (731) SummaryNet cash provided by (used in) operating activities 2,489 (2,149) CASH FLOWS FROM INVESTING ACTIVITIES: Origination of loans held for investment (119,062) (81,519) Additional funding of loans held for investment (4,835) — Repayment of loans held for investment 53,610 — Net cash used in investing activities (70,287) (81,519) CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS STATEMENTS CONDENSED CONSOLIDATED Tremont Mortgage Trust ConfidentialSupplemental Operating and Financial Data, September 30, 2019 12

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED) (dollars in thousands) For the Nine Months Ended September 30, 2019 2018 CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from master repurchase facility 92,983 21,583 Repayment of master repurchase facility (34,312) — Proceeds from RMR credit agreement 14,220 — Repayment of RMR credit agreement (14,220) — Proceeds from note payable — 31,690 Repayment of note payable (31,690) — Payments of deferred financing costs (347) (1,045) Proceeds from issuance of common shares, net 26,074 — RepurchaseFinancial of common shares (37) (25) Distributions (2,854) — NetSummary cash provided by financing activities 49,817 52,203 Decrease in cash, cash equivalents and restricted cash (17,981) (31,465) Cash, cash equivalents and restricted cash at beginning of period 27,335 61,666 Cash, cash equivalents and restricted cash at end of period $ 9,354 $ 30,201 SUPPLEMENTAL DISCLOSURES: Interest paid $ 4,974 $ 382 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, 2019 2018 Cash and cash equivalents $ 9,244 $ 30,101 Restricted cash 110 100 Total cash, cash equivalents and restricted cash shown in the condensed consolidated statements of cash flows $ 9,354 $ 30,201 Tremont Mortgage Trust CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED) STATEMENTS CONDENSED CONSOLIDATED ConfidentialSupplemental Operating and Financial Data, September 30, 2019 13

DEBT SUMMARY (dollars in thousands) As of September 30, 2019 Coupon Rate Initial Maturity Date Principal Balance DEBT SUMMARY Financings Under Master Repurchase Facility (Repo): Office, Metairie, LA L + 2.35% 04/11/2021 $ 12,377 Office, Houston, TX L + 2.15% 06/26/2021 9,544 Retail, Paradise Valley, AZ L + 2.10% 11/30/2020 4,415 Office, St. Louis, MO L + 1.85% 11/06/2021 19,830 Hotel, Atlanta, GA L + 2.00% 11/06/2021 16,425 Multifamily, Rochester, NY L + 2.00% 11/06/2021 9,714 Retail, Coppell, TX L + 2.10% 02/05/2021 1,032 Industrial, Barrington, NJ L + 2.00% 11/06/2021 26,175 Multifamily, Houston, TX L + 1.85% 11/09/2020 21,980 Retail, Omaha, NE L + 2.00% 11/06/2021 9,761 Total/weighted average L + 2.00% $ 131,253 Tremont Mortgage Trust ConfidentialSupplemental Operating and Financial Data, September 30, 2019 14

RECONCILIATION OF NET INCOME (LOSS) TO CORE EARNINGS (LOSS)(1) ) (amounts in thousands, except per share data) Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Reconciliation of Net Income (Loss) to Core Earnings (Loss): (1) Net income (loss) $ 2,056 $ (63) $ 3,528 $ (1,793) Non-cash equity compensation expense 80 118 300 349 Core Earnings (Loss) $ 2,136 $ 55 $ 3,828 $ (1,444) Weighted average common shares outstanding - basic and diluted 8,156 3,129 5,583 3,121 Core Earnings (Loss) per common share - basic and diluted $ 0.26 $ 0.02 $ 0.69 $ (0.46) (1) See Key Definitions on page 7 for a definition of Core Earnings (Loss), a description of why we believe it's an appropriate supplemental measure and a description of how we use this measure. RECONCILIATION OF NET INCOME (LOSS) TO CORE EARNINGS (LOSS) OF NET INCOME (LOSS) TO RECONCILIATION Tremont Mortgage Trust ConfidentialSupplemental Operating and Financial Data, September 30, 2019 15

PORTFOLIO OVERVIEW West Park I, St. Louis, MO Part of West Park I, West Park II and Pine View Point Office Portfolio $29.5 Million First Mortgage Whole Loan ‹#›

THIRD QUARTER 2019 PORTFOLIO SUMMARY (dollars in thousands) Third Quarter 2019 Portfolio Activity Unfunded Commitments Portfolio Summary as of September 30, 2019 $1,466 $53,610 Number of loans 10 $227,157 Total Commitments $18,813 Unfunded Commitments Average loan commitment $22,716 Principal Balance $260,488 Principal Balance Total loan commitments $227,157 $208,344 Unfunded loan commitments $18,813 Principal balance $208,344 Q2 2019 Portfolio Funding Repayments Q3 2019 Portfolio Weighted average coupon rate 5.85% Loan Originations by Quarter $80,100 Total Commitments $4,710 Unfunded Commitments Weighted average all in yield (1) 6.51% $66,290 (1) THIRD QUARTER 2019 PORTFOLIO SUMMARY Weighted average maximum maturity 3.6 $12,063 $55,210 (1) Weighted average LTV 70% $1,917 $47,465 $2,865 $75,390 Principal Balance (1) See Key Definitions on page 7 for definitions of all in yield, maximum maturity and LTV. $53,293 $54,227 $44,600 $0 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Tremont Mortgage Trust ConfidentialSupplemental Operating and Financial Data, September 30, 2019 17

LOAN INVESTMENT DETAILS (dollars in thousands) First Mortgage Whole Loans as of September 30, 2019: Maximum Committed Maximum Maturity Property Origination Principal Principal Coupon All in Maturity (1) (years Location Type Date Amount Balance Rate Yield (1) (date) remaining)(1) LTV (1) Metairie, LA Office 04/11/2018 $ 18,102 $ 16,679 L + 5.00% L + 5.66% 04/11/2023 3.6 79% Houston, TX Office 06/26/2018 15,200 13,719 L + 4.00% L + 4.61% 06/26/2023 3.8 69% Paradise Valley, AZ Retail 11/30/2018 12,790 6,400 L + 4.25% L + 6.16% 11/30/2022 3.2 48% St. Louis, MO Office 12/19/2018 29,500 26,637 L + 3.25% L + 3.76% 12/19/2023 4.3 72% Atlanta, GA Hotel 12/21/2018 24,000 23,218 L + 3.25% L + 3.73% 12/21/2023 4.3 62% Rochester, NY Multifamily 01/22/2019 24,550 24,550 L + 3.25% L + 3.86% 01/22/2024 4.4 74% LOAN INVESTMENT DETAILS Coppell, TX Retail 02/05/2019 22,915 21,751 L + 3.50% L + 4.26% 02/05/2021 1.4 73% Barrington, NJ Industrial 05/06/2019 37,600 34,900 L + 3.50% L + 4.05% 05/06/2023 3.7 79% Houston, TX Multifamily 05/10/2019 28,000 27,475 L + 3.50% L + 4.37% 11/10/2022 3.2 56% Omaha, NE Retail 06/14/2019 14,500 13,015 L + 3.65% L + 4.05% 06/14/2024 4.8 77% Total/weighted average $ 227,157 $ 208,344 L + 3.60% L + 4.25% 3.6 70% (1) See Key Definitions on page 7 for definitions of LTV, all in yield and maximum maturity. Tremont Mortgage Trust ConfidentialSupplemental Operating and Financial Data, September 30, 2019 18

LOAN PORTFOLIO DIVERSIFICATION (dollars in thousands) Geographic Diversification by Investment (based on book value of loans held for investment as of September 30, 2019) Maximum Maturity Profile (1) (based on principal balance as of September 30, 2019) Midwest: 19% East: 29% $125,730 $115,153 West: 3% $104,775 $83,820 South: 49% $62,865 Property Type by Investment $37,565 (based on book value of loans held for investment as of September 30, 2019) $41,910 $33,875 LOAN PORTFOLIO DIVERSIFICATION Retail $21,751 $20,955 Industrial: 17% Office: 27% $0 2019 2020 2021 2022 2023 2024 (1) See Key Definitions on page 7 for a definition of maximum maturity. Multifamily: 25% Hotel: 11% Retail: 20% Tremont Mortgage Trust ConfidentialSupplemental Operating and Financial Data, September 30, 2019 19

INTEREST RATE SENSITIVITY (dollars in thousands) $1,400 t e $1,200 N , s t n e $1,000 m t s e v n I $800 m o r f e m $600 o c n I l a u $400 n n A l a t n $200 e INTEREST RATE SENSITIVITY INTEREST RATE m e r c n I $0 -$200 (1.00%) (0.50%) 0.50% 1.00% Change in USD LIBOR The interest income on our loans held for investment and interest expense on our borrowings float with LIBOR. Because we generally lever approximately 75% of our investments, as LIBOR increases, our income from investments, net of interest and related expenses, will increase, and, as LIBOR decreases, our income from investments, net of interest and related expenses, will decrease. However, we have interest rate floor provisions in our loan agreements with borrowers which set a minimum LIBOR rate for each loan. Based on our loan portfolio at September 30, 2019, our weighted average floor rate was 2.19% and the LIBOR used in this analysis was fixed at 2.05%. We do not have a similar provision in our Master Repurchase Agreement. As a result, if LIBOR decreases below the floor established for any of our investments, our income from investments will decrease less than our borrowing costs and the net amount may result in an increase in our net investment income. The above table illustrates the incremental impact on our annual income from investments, net, due to increases and decreases in LIBOR of 50 basis points and 100 basis points in LIBOR taking into consideration our borrowers’ interest rate floors as of September 30, 2019. The results in the table above are based on our current loan portfolio and debt outstanding at September 30, 2019. Any changes to the mix of investments or debt outstanding could have an impact on the sensitivity analysis above and this illustration is not meant to forecast future results. Tremont Mortgage Trust ConfidentialSupplemental Operating and Financial Data, September 30, 2019 20

CAPITAL STRUCTURE OVERVIEW (amounts in thousands) Capital Structure Composition Leverage Capacity (1) (as of September 30, 2019) (as of September 30, 2019) $240,000 $220,000 $200,000 $180,000 Equity: 40% $82,229 $160,000 $140,000 $120,000 Repo: 60% $100,000 $131,253 $80,000 $60,000 Master Repurchase Facility Advanced Unused Capacity Debt to Investment Capital Structure Detail CAPITAL STRUCTURE OVERVIEW CAPITAL (as of September 30, 2019) (as of September 30, 2019) Maximum Coupon Initial Maturity Principal (1) $250,000 Credit Facilities Facility Size Rate Date Balance Master Repurchase Facility $ 213,482 L + 2.00% 11/06/2021 $ 131,253 $208,344 $200,000 Book Value per Common Share Shareholders’ equity $ 86,679 $150,000 $131,253 Total outstanding common shares 8,240 Book value per common share $ 10.52 $100,000 (1) Weighted average rate based on principal balances as of September 30, 2019. $50,000 $0 Investments Secured Financing Tremont Mortgage Trust ConfidentialSupplemental Operating and Financial Data, September 30, 2019 21

WARNING CONCERNING FORWARD-LOOKING STATEMENTS This supplemental operating and financial data may contain 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. Actual results may differ materially from those contained in or implied by our forward- looking statements. Forward-looking statements involve known and unknown risks, uncertainties and other factors, some of which are beyond our control.  The information contained in our filings with the SEC, including under “Risk Factors” in our periodic reports, or incorporated therein, identifies important factors that could cause our actual results to differ materially from those stated in or implied by 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 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 CONCERNING FORWARD-LOOKING WARNING Tremont Mortgage Trust ConfidentialSupplemental Operating and Financial Data, September 30, 2019 22

XML

Cover Page Cover Page	Nov. 06, 2019
Cover Page [Abstract]
Document Type	8-K
Document Period End Date	Nov. 06, 2019
Entity Registrant Name	Tremont Mortgage Trust
Entity Incorporation, State or Country Code	MD
Entity File Number	001-38199
Entity Tax Identification Number	82-1719041
Entity Address, Address Line One	Two Newton Place
Entity Address, Address Line Two	255 Washington Street
Entity Address, Address Line Three	Suite 300
Entity Address, City or Town	Newton
Entity Address, State or Province	MA
Entity Address, Postal Zip Code	02458-1634
Title of 12(b) Security	Common Shares of Beneficial Interest
Trading Symbol	TRMT
Security Exchange Name	NASDAQ
City Area Code	617
Local Phone Number	796-8317
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Emerging Growth Company	true
Entity Central Index Key	0001708405
Amendment Flag	false
Entity Ex Transition Period	false