FOR IMMEDIATE RELEASE
Olivia Snyder, Manager, Investor Relations
Select Income REIT Announces Third Quarter 2018 Results
Third Quarter Net Income of $29.5 Million, or $0.33 per Share
Third Quarter Normalized FFO of $56.0 Million, or $0.63 per Share
Third Quarter Same Property Cash Basis NOI Increased 4.8%
Announced Agreement to Merge with Government Properties Income Trust
Newton, MA (October 29, 2018): Select Income REIT (Nasdaq: SIR) today announced financial results for the quarter and nine months ended September 30, 2018.
David Blackman, President and Chief Executive Officer, made the following statement:
"The major development for Select Income REIT this quarter was our agreement to merge with Government Properties Income Trust. We believe this transaction will create a leading national office REIT with increased scale, strong portfolio characteristics and one of the highest percentages of rent paid by investment grade rated tenants in the office sector. As part of the merger, we expect to distribute to our shareholders all 45,000,000 common shares of Industrial Logistics Properties Trust that we own, completely separating the two companies and positioning our shareholders to possibly benefit from the increased liquidity in ILPT shares.
During the third quarter, we were also successful in operating our business. We sold a 418,000 square foot vacant land parcel in Hawaii for $10.3 million, resulting in a net gain of $4.1 million. We, excluding ILPT, also entered one lease renewal for 72,000 square feet that resulted in a rental rate that was approximately 40% higher than the prior rental rate for the same space and a lease term of 7.6 years."
Results for the Quarter Ended September 30, 2018:
Net income attributed to SIR for the quarter ended September 30, 2018 was $29.5 million, or $0.33 per diluted share, compared to $31.4 million, or $0.35 per diluted share, for the same period last year. Net income attributed to SIR for the quarter ended September 30, 2018 includes: (1) an unrealized gain on equity securities of $22.8 million, or $0.25 per diluted share, related to SIR's investment in The RMR Group Inc., or RMR Inc., which is included in earnings in accordance with U.S. generally accepted accounting principles, or GAAP, effective January 1, 2018; (2) a gain on sale of real estate of $4.1 million, or $0.05 per diluted share; (3) a loss on impairment of real estate assets of $9.7 million, or $0.11 per diluted share; (4) a reduction for estimated business management incentive fees of $6.7 million, or $0.07 per diluted share; (5) a reduction for net income allocated to noncontrolling interest
A Maryland Real Estate Investment Trust with transferable shares of beneficial interest listed on the Nasdaq.
No shareholder, Trustee or officer is personally liable for any act or obligation of the Trust.
The following information was filed by Select Income Reit (SIR) on Monday, October 29, 2018 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.