SCHEDULE: Redwood Capital Gains Influence in Office Properties Income Trust

Redwood Capital Management and affiliates have acquired a significant stake and governance rights in Office Properties Income Trust following its emergence from bankruptcy.

Summary

• Redwood Capital Management, LLC, along with its affiliates Redwood Capital Management Holdings, LP, Double Twins K, LLC, and Ruben Kliksberg, have jointly filed a Schedule 13D.
• This filing indicates beneficial ownership of 3,961,992 Common Shares of Beneficial Interest in Office Properties Income Trust, representing 18.0% of the outstanding shares.
• The shares and other consideration were received on June 17, 2026, as part of the Issuer's confirmed Chapter 11 Plan of Reorganization.
• Redwood Capital now has the right to designate up to two Trustees to the Board of Trustees as long as they hold 10% or more of the outstanding shares.
• Additionally, Redwood Capital has board observation rights, allowing them to appoint a non-voting Board Observer as long as they hold 15% or more of the outstanding shares.
• The Reporting Persons have engaged in selling shares between August 6, 2026, and August 18, 2026.

Sentiment

Score: 6

Explanation: StockSavvy.ai views this filing as neutral to slightly positive, reflecting a significant ownership stake and governance influence post-bankruptcy, but with ongoing share sales.

Positives

• Acquisition of a significant ownership stake (18.0%) in Office Properties Income Trust.
• Gained influence through the right to designate up to two Trustees to the Board.
• Secured board observation rights, allowing for direct insight into board proceedings.
• The acquisition of shares and notes occurred as part of a confirmed bankruptcy reorganization plan, suggesting a structured emergence from financial distress.

Negatives

• Significant share sales by Redwood Capital Management and its affiliates occurred between August 6 and August 18, 2026, totaling over 250,000 shares.
• The nature of the sales (e.g., profit-taking, portfolio rebalancing) is not explicitly detailed beyond being open-market transactions.

Risks

• Potential for further share sales by Redwood Capital, which could impact share price.
• The ongoing influence of a significant shareholder may lead to strategic decisions that do not align with all stakeholders' interests.
• The company has recently emerged from Chapter 11 bankruptcy, indicating inherent financial and operational risks.

Future Outlook

The Reporting Persons state they review their investment on a continuing basis and may take various actions, including acquiring additional shares, disposing of shares, or entering into derivative transactions, depending on market conditions and the Issuer's performance. They also expect to continue engaging in discussions with potential strategic partners, acquirers, and financing sources.

Management Comments

• The Reporting Persons have in the past considered and may in the future consider a wide variety of matters and plans or proposals that could result in the occurrence of any of the matters set forth in clauses (a)-(j) of Item 4 of Schedule 13D.
• As a result of their ownership interest in the Issuer, the Reporting Persons exercise significant influence over the Issuer's business practices and strategy and all matters requiring action by the Issuer's shareholders, including the election of the Board of the Issuer and the ability as shareholders to approve or reject strategic or corporate transactions.

Industry Context

StockSavvy.ai notes that this filing occurs as Office Properties Income Trust emerges from bankruptcy. The acquisition of significant influence and board seats by Redwood Capital is a common strategy for activist investors or distressed debt holders seeking to influence the restructuring and future direction of companies exiting bankruptcy.

Management Changes

Corporate Governance

Legal Proceedings

• Office Properties Income Trust and certain subsidiaries were involved in Chapter 11 bankruptcy proceedings, confirmed on April 22, 2026.

Related Party Transactions

• The filing details the acquisition of securities by Redwood Funds, managed by Redwood Capital Management, as part of the bankruptcy reorganization plan.

Stakeholder Impact

• Shareholders: Potential for increased volatility due to Redwood Capital's significant stake and potential future transactions; governance changes may lead to strategic shifts.
• Creditors: The emergence from bankruptcy and subsequent governance changes could impact the recovery and future dealings with creditors.
• Management/Board: Increased oversight and potential influence from Redwood Capital on strategic decisions and board composition.

Next Steps

• Redwood Capital will continue to review its investment in Office Properties Income Trust.
• Redwood Capital may engage in discussions with potential strategic partners, acquirers, or financing sources.
• Redwood Capital may take actions such as acquiring additional securities or disposing of existing holdings.

Key Dates

Recommendation

The filing indicates a significant ownership stake and governance influence for Redwood Capital in Office Properties Income Trust following its bankruptcy emergence. However, the simultaneous sales of shares by Redwood Capital suggest a mixed sentiment, potentially indicating profit-taking or portfolio adjustments rather than a strong conviction for immediate upside. The company's post-bankruptcy recovery and Redwood's future actions warrant a 'hold' stance pending further developments.

Keywords

Office Properties Income Trust, Schedule 13D, Redwood Capital Management, Bankruptcy Reorganization, Beneficial Ownership, Board of Trustees, Real Estate Investment Trust, Governance Rights