EQUITY COMMONWEALTH Management’s Discussion and Analysis of Financial Condition and Results of Operations. (Form 10-Q)

The following discussion should be read in conjunction with our consolidated
financial statements and accompanying notes included in this Quarterly Report on
Form 10-Q, and in our Annual Report.

FORWARD-LOOKING STATEMENTS

Some of the statements contained in this Quarterly Report on Form 10-Q
constitute forward-looking statements within the meaning of the federal
securities laws including, but not limited to, statements pertaining to our
anticipated business strategies, goals, policies and objectives, capital
resources and financing, portfolio performance, lease expiration schedules,
results of operations or anticipated market conditions, including our statements
regarding remote working trends and the overall impact of COVID-19, and changing
laws, statutes, regulations, and the interpretations thereof, on the foregoing.
Any forward-looking statements contained in this Quarterly Report on Form 10-Q
are intended to be made pursuant to the safe harbor provisions of Section 27A of
the Securities Act of 1933, as amended, or the Securities Act, and Section 21E
of the Securities Exchange Act of 1934, as amended, or the Exchange Act.
Forward-looking statements relate to expectations, beliefs, projections, future
plans and strategies, anticipated events or trends and similar expressions
concerning matters that are not historical facts. You can identify
forward-looking statements by the use of forward-looking terminology, including
but not limited to, "may," "will," "should," "could," "would," "expects,"
"intends," "plans," "anticipates," "believes," "estimates," "predicts," or
"potential" or the negative of these words and phrases or similar words or
phrases which are predictions of or indicate future events or trends and which
do not relate solely to historical matters. You can also identify
forward-looking statements by discussions of strategy, plans or intentions.

Any forward-looking statements contained in this Quarterly Report on Form 10-Q
reflect our current views about future events and are subject to numerous known
and unknown risks, uncertainties, assumptions and changes in circumstances that
may cause our actual results to differ significantly from those expressed in any
forward-looking statement. We do not guarantee that the transactions and events
described will happen as described (or that they will happen at all). We
disclaim any obligation to publicly update or revise any forward-looking
statement to reflect changes in underlying assumptions or factors, of new
information, data or methods, future events or other changes. For a further
discussion of these and other factors that could cause our future results to
differ materially from any forward-looking statements, see the section entitled
"Risk Factors" in our most recent Annual Report and in Part II, Item 1A "Risk
Factors" of this Quarterly Report on Form 10-Q.

OVERVIEW

We are an internally managed and self-advised REIT primarily engaged in the
ownership and operation of office properties in the United States. We were
formed in 1986 under Maryland law. The Company operates as an UPREIT, conducting
substantially all of its activities through the Operating Trust. As of June 30,
2022, the Company beneficially owned 99.75% of the outstanding OP Units.

To June 30, 2022, our portfolio consisted of four properties (eight buildings), with a combined area of ​​1.5 million square feet. From June 30, 2022we have had $2.7 billion cash and cash equivalents.

We use leasing and occupancy metrics to evaluate the performance of our
properties. We believe these metrics provide useful information to investors
because they reflect the leasing activity and vacant space at the properties and
may facilitate comparisons of our leasing and occupancy metrics with other REITs
and real estate companies.

As of June 30, 2022, our overall portfolio was 84.8% leased. During the three
months ended June 30, 2022, we entered into leases for 34,000 square feet,
including lease renewals for 6,000 square feet and new leases for 28,000 square
feet. The renewal leases entered into during the three months ended June 30,
2022 had cash and GAAP rental rates that were approximately 4.9% higher and 9.6%
higher, respectively, compared to prior rental rates for the same space. The new
leases entered into during the three months ended June 30, 2022 were excluded
from the weighted average cash and GAAP rental rate calculations because the
suites were vacant longer than two years. The change in GAAP rents is different
than the change in cash rents due to differences in the amount of rent
abatements, the magnitude and timing of contractual rent increases over the
lease term, and the length of term for the newly executed leases compared to the
prior leases. Percent change in GAAP and cash rents is a comparison of current
rent, including estimated tenant expense reimbursements, if any, to the rent,
including actual/projected tenant expense reimbursements, if any, last received
for the same space on a GAAP and cash basis, respectively. Cash rent during the
reporting period is calculated before deducting any initial period free rent.
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We have engaged CBRE, Inc., or CBRE, to provide property management services. We
pay CBRE a property-by-property management fee and may engage CBRE from
time-to-time to perform project management services, such as coordinating and
overseeing the completion of tenant improvements and other capital projects at
the properties. We reimburse CBRE for certain expenses incurred in the
performance of its duties, including certain personnel and equipment costs. For
the three months ended June 30, 2022 and 2021, we incurred expenses of $0.7
million and $0.7 million, respectively, and for the six months ended June 30,
2022 and 2021, we incurred expenses of $1.5 million and $1.5 million,
respectively, related to our property management agreement with CBRE, for
property management fees, typically calculated as a percentage of the
properties' revenues, and salary and benefits reimbursements for property
personnel, such as property managers, engineers and maintenance staff.  As of
June 30, 2022 and December 31, 2021, we had amounts payable pursuant to these
services of $0.2 million and $0.3 million, respectively.

After executing on our disposition strategy and evaluating a variety of
opportunities to invest our capital, on May 4, 2021, we entered into a merger
agreement to acquire Monmouth Real Estate Investment Corporation, or Monmouth, a
publicly-traded industrial REIT. On August 31, 2021, following Monmouth's
failure to obtain shareholder approval of the merger, in accordance with the
terms of the merger agreement, we terminated the merger agreement.

Following the termination of the merger agreement with Monmouth, we shifted our
focus to capital allocation and are continuing to evaluate investment
opportunities. We are seeking to use the strength and liquidity of our balance
sheet for investments in high-quality assets or businesses in a range of
property types that offer a compelling risk-reward profile. We may also
determine to sell, liquidate or otherwise exit our business if we believe doing
so will maximize shareholder value.

Our business has been and is continuing to be impacted by the COVID-19 virus. In
addition, our business has been and is continuing to be impacted by tenant
uncertainty regarding office space needs given the evolving remote working
trends. Many of our employees and the majority of our tenants' employees are
currently working at least in part remotely. Overall, our business has
experienced a significant reduction in leasing interest and activity when
compared to pre-pandemic levels. As of June 30, 2022 and December 31, 2019, our
comparable property portfolio was 84.8% and 91.5% leased, respectively. The
duration of these business disruptions continues to be unknown at this time, and
we currently are not able to estimate the full impact of the COVID-19 virus and
remote working trends on our business.

Real estate transactions

Leased occupancy data for 2022 and 2021 are as follows (square feet in
thousands):
                            All Properties                  Comparable Properties(1)
                            As of June 30,                       As of June 30,
                          2022            2021                 2022                 2021
Total properties                4            4                            4            4
Total square feet           1,507        1,507                        1,507        1,507
Percent leased(2)            84.8  %      83.1  %                      84.8  %      83.1  %



(1)Based on properties owned continuously from January 1, 2021 through June 30,
2022.
(2)Percent leased is the percent of space subject to signed leases. Percent
leased is disclosed to quantify the ratio of leased square feet to rentable
square feet and we believe provides useful information as to the proportion of
rentable square feet subject to a lease.

The weighted average lease term based on square feet for leases entered into
during the three months ended June 30, 2022 was 6.0 years.  Commitments made for
leasing expenditures and concessions, such as tenant improvements and leasing
commissions, for the leases entered into during the three months ended June 30,
2022 totaled $2.2 million, or $66.31 per square foot on average (approximately
$10.98 per square foot per year of the lease term).

As of June 30, 2022, approximately 4.7% of our leased square feet and 5.6% of
our annualized rental revenue, determined as set forth below, are included in
leases scheduled to expire through December 31, 2022.  Renewal and new leases
and rental rates at which available space may be relet in the future will depend
on prevailing market conditions at the times these leases are negotiated.  We
believe that the in-place cash rents for leases expiring for the remainder of
2022, that have not been backfilled, are approximately market. Lease expirations
by year, as of June 30, 2022, are as follows (square feet and dollars in
thousands):
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                                                                                                                                                          Annualized                                     Cumulative
                                                                                                       % of Leased               Cumulative                 Rental                  % of                    % of
                                                 Number                    Leased Square               Square Feet           % of Leased Square            Revenue            Annualized Rental       Annualized Rental
Year                                     of Tenants Expiring(1)           Feet Expiring(2)             Expiring(2)            Feet Expiring(2)           Expiring(3)          Revenue Expiring        Revenue Expiring
2022                                                  5                           60                            4.7  %                    4.7  %       $       3,362                     5.6  %                  5.6  %
2023                                                 19                          210                           16.4  %                   21.1  %               9,664                    16.1  %                 21.7  %
2024                                                 18                          227                           17.9  %                   39.0  %              10,707                    17.9  %                 39.6  %
2025                                                 12                          155                           12.1  %                   51.1  %               7,048                    11.7  %                 51.3  %
2026                                                  8                           67                            5.2  %                   56.3  %               3,268                     5.4  %                 56.7  %
2027                                                 14                          176                           13.8  %                   70.1  %               8,325                    13.9  %                 70.6  %
2028                                                  7                           82                            6.4  %                   76.5  %               3,635                     6.1  %                 76.7  %
2029                                                  7                          145                           11.3  %                   87.8  %               6,970                    11.6  %                 88.3  %
2030                                                  6                           87                            6.8  %                   94.6  %               2,910                     4.8  %                 93.1  %
2031                                                  1                           12                            0.9  %                   95.5  %                 590                     1.0  %                 94.1  %
Thereafter                                            4                           57                            4.5  %                  100.0  %               3,541                     5.9  %                100.0  %
                                                    101                        1,278                          100.0  %                                 $      60,020                   100.0  %

Weighted average remaining lease term (in years):                                4.0                                                                             4.1



(1)Tenants with leases expiring in multiple years are counted in each year they
expire.
(2)Leased Square Feet as of June 30, 2022 includes space subject to leases that
have commenced for revenue recognition purposes in accordance with GAAP, space
being fitted out for occupancy pursuant to existing leases, and space which is
leased but is not occupied or is being offered for sublease by tenants. The
Leased Square Feet Expiring corresponds to the latest-expiring signed lease for
a given suite. Thus, backfilled suites expire in the year stipulated by the new
lease.
(3)Annualized rental revenue is annualized contractual rents from our tenants
pursuant to leases which have commenced as of June 30, 2022, plus estimated
recurring expense reimbursements; excludes lease value amortization,
straight-line rent adjustments, abated (free) rent periods and parking revenue.
We calculate annualized rental revenue by aggregating the recurring billings
outlined above for the most recent month during the quarter reported, adding
abated rent, and multiplying the sum by 12 to provide an estimation of near-term
potentially-recurring revenues.  Annualized rental revenue is a forward-looking
non-GAAP measure.  Annualized rental revenue cannot be reconciled to a
comparable GAAP measure without unreasonable efforts, primarily due to the fact
that it is calculated from the billings of tenants in the most recent month at
the most recent rental rates during the quarter reported, whereas historical
GAAP measures include billings from a potentially different group of tenants
over multiple months at potentially different rental rates.

The principal source of funds for our operations is rents from tenants at our
properties.  Rents are generally received from our tenants monthly in advance.
As of June 30, 2022, tenants representing 2.5% or more of our total annualized
rental revenue were as follows (square feet in thousands):
                                                                                                                                                    Weighted
                                                                                                                                                    Average
                                                                                               % of Total Leased         % of Annualized           Remaining
Tenant                                                                Square Feet(1)            Square Feet(1)          Rental Revenue(2)          Lease Term
1.     Equinor Energy Services, Inc.                                          80                           6.3  %                   5.8  %             1.5
2.     KPMG, LLP                                                              71                           5.6  %                   5.0  %             6.9
3.     Salesforce.com, Inc.                                                   65                           5.1  %                   5.0  %             3.4
4.     Wunderman Thompson, LLC(3)                                             39                           3.1  %                   3.8  %             3.2
5.     Crowdstrike, Inc.                                                      36                           2.8  %                   3.7  %             2.3
6.     CBRE, Inc.                                                             40                           3.1  %                   3.4  %             5.8
7.     RSM US LLP                                                             32                           2.5  %                   3.1  %             9.9
8.     SonarSource US, Inc.                                                   28                           2.2  %                   2.9  %             5.2
9.     Alden Torch Financial, LLC                                             34                           2.7  %                   2.5  %             4.7
       Total                                                                 425                          33.4  %                  35.2  %             4.5



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(1)Total Leased Square Feet as of June 30, 2022 includes space subject to leases
that have commenced, space being fitted out for occupancy pursuant to existing
leases, and space which is leased but is not occupied or is being offered for
sublease by tenants.
(2)Annualized rental revenue is annualized contractual rents from our tenants
pursuant to leases which have commenced as of June 30, 2022, plus estimated
recurring expense reimbursements; excludes lease value amortization,
straight-line rent adjustments, abated (free) rent periods and parking revenue.
We calculate annualized rental revenue by aggregating the recurring billings
outlined above for the most recent month during the quarter reported, adding
abated rent, and multiplying the sum by 12 to provide an estimation of near-term
potentially-recurring revenues.  Annualized rental revenue is a forward-looking
non-GAAP measure.  Annualized rental revenue cannot be reconciled to a
comparable GAAP measure without unreasonable efforts, primarily due to the fact
that it is calculated from the billings of tenants in the most recent month at
the most recent rental rates during the quarter reported, whereas historical
GAAP measures include billings from a potentially different group of tenants
over multiple months at potentially different rental rates.
(3)Approximately 24,000 square feet of Wunderman Thompson, LLC's space expire in
2027. The remaining 15,000 square feet expire in 2022.

FD Regulation Disclosures

We use any of the following to comply with our disclosure obligations under
Regulation FD: press releases, SEC filings, public conference calls, or our
website. We routinely post important information on our website at
www.eqcre.com, including information that may be deemed to be material. We
encourage investors and others interested in the Company to monitor these
distribution channels for material disclosures. Our website address is included
in this Quarterly Report as a textual reference only and the information on the
website is not incorporated by reference into this Quarterly Report.

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