OPI files April bankruptcy report showing $69M cash, confirmed reorganization plan

OPI's Q1 2026 same property results show occupancy declined to 81.3% from 85.4% year-over-year, while rental income fell to $99.7M from $103.9M. Same Property NOI decreased 8.4% to $55.4M, though Same Property Cash Basis NOI declined only 0.5% to $52.6M, indicating the NOI decline was largely driven by non-cash adjustments. The 4.1 percentage point occupancy decline and margin compression suggest continued leasing challenges in OPI's office portfolio.

OPI executed 212,000 square feet of leases in Q1 2026, with 177,000 square feet in renewals and 35,000 square feet in new leases. Rents increased 9.3% overall (12.1% on new leases, 8.8% on renewals), but the weighted average lease term was only 4.5 years (1.6 years for new leases, 5.1 years for renewals). Total leasing costs were $4.5M or $21.36 per square foot, with renewal costs of $22.67 per square foot significantly higher than new lease costs of $14.73 per square foot. The short 1.6-year term on new leases and elevated renewal costs suggest challenging market conditions.

OPI's top five tenants represent 35.8% of total annualized rental income as of March 31, 2026. The U.S. Government is the largest tenant at 17.5% of rental income, followed by Google at 5.6%, IG Investments at 4.8%, Bank of America at 4.4%, and Shook Hardy & Bacon at 3.5%. Investment grade tenants (including those with investment grade guarantors) account for 60.1% of rental income, while 33.0% are not rated and 6.9% are non-investment grade. This concentration creates significant exposure to government budget decisions and a small number of large tenants.

OPI faces significant near-term lease rollover, with 3.1% of annualized rental income expiring in the remainder of 2026 and 12.5% expiring in 2027. Cumulatively, 31.1% of rental income expires by the end of 2029. The weighted average remaining lease term is 6.4 years. With occupancy already at 78.2% and challenging office market conditions, this rollover schedule creates meaningful re-leasing risk over the next three years.

The forward-looking statements section discloses that OPI is in bankruptcy proceedings and references a plan of reorganization. The filing also mentions debtor-in-possession financing and properties collateralized under that financing. This indicates OPI is operating under Chapter 11 bankruptcy protection, which creates significant uncertainty about the company's future capital structure, ownership, and ability to continue operations. The going concern reference suggests substantial doubt about OPI's viability.

OPI filed its Monthly Operating Reports covering April 2026 operations with the Bankruptcy Court. These reports are required as part of the company's Chapter 11 bankruptcy proceedings that commenced in October 2025. The MORs provide financial and operational data but were not prepared under GAAP and were not audited.

The company confirms it continues operating as debtor-in-possession under Bankruptcy Court supervision. This means OPI retains control of its business operations and property management while working through the Chapter 11 reorganization process that began in October 2025.

The company warns that the Monthly Operating Reports have significant limitations: they are unaudited, not prepared under GAAP, follow bankruptcy-specific formats, and may be adjusted later. Investors should not rely on them as a basis for investment decisions or as indicative of future results.

The bankruptcy court confirmed OPI's reorganization plan on April 22, 2026, following a confirmation hearing the same day. The plan has been approved but has not yet become effective, meaning the company remains in Chapter 11 proceedings while working toward emergence. This is a critical milestone in the bankruptcy process, establishing the framework for how creditors will be treated and how the company will exit bankruptcy.

OPI drew $40.0 million under the Tranche B Term Loan portion of its DIP facility during April 2026, receiving $39.0 million in the week ended April 10 and $1.0 million in the week ended April 17. This brings total DIP borrowings to $125 million ($10 million Tranche A1, $75 million Tranche A2, and $40 million Tranche B), providing liquidity to fund operations during the bankruptcy process.

OPI paid $4.3 million in bankruptcy-related professional fees during April 2026, bringing cumulative fees since the October 2025 filing to $21.1 million. The largest recipients were Latham & Watkins (lead counsel, $11.1 million cumulative), AP Services (financial advisor, $6.4 million cumulative), and Hunton Andrews Kurth (local counsel, $1.4 million cumulative). These fees are typical for a complex Chapter 11 case but represent a significant ongoing cost.

OPI reported total liabilities of $4.3 billion as of April 30, 2026, consisting of $1.3 billion in prepetition secured debt, $2.8 billion in prepetition unsecured debt, and $178.4 million in postpetition payables. The company has negative equity of $630.6 million, reflecting a balance sheet deeply underwater. These figures illustrate the severity of the financial distress that led to the bankruptcy filing and will inform creditor recoveries under the confirmed plan.