Thank you and good morning, everyone. Yesterday, Orion released its results for the quarter ended June 30th, 2026, filed its Form 10-Q with the Securities and Exchange Commission, and posted its earnings supplement to its website at onlreit.com.

During the call today, we will be discussing Orion's guidance estimates for calendar year 2026 and other forward-looking statements, which are based on management's current expectations and are subject to certain risks that could cause actual results to differ materially from our estimates. These risks are discussed in our earnings release as well as in our Form 10-Q and other SEC filings, and Orion undertakes no duty to update any forward-looking statements made during this call.

We will also be discussing non-GAAP financial measures, such as funds from operations, or FFO, and core funds from operations, or core FFO. These non-GAAP financial measures are not a substitute for financial information presented in accordance with GAAP, and Orion's earnings release and supplement include a reconciliation of our non-GAAP financial measures to the most directly comparable GAAP measure.

Hosting the call today are Orion's Chief Executive Officer, Paul McDowell, and Chief Financial Officer, Gavin Brandon. Joining us for the Q&A session will be Chris Day, our Chief Operating Officer.

With that, I will turn the call over to Paul McDowell.

Good morning, everyone, and thank you for joining us on Orion's second quarter earnings call. I will start with a few words on our continuing strategic options process that began in late January.

Since that announcement, in concert with our financial advisors at Wells Fargo and J.P. Morgan, we have conducted a robust effort, including broad outreach to solicit proposals from interested parties.

Those efforts have been supported by a virtual data room containing comprehensive property and corporate data for those participants that sign nondisclosure agreements. With several parties continuing to conduct diligence, we believe it is in shareholders' interest to see that work through to its reasonable conclusion, rather than set arbitrary deadlines.

Rest assured, we are moving as expeditiously as possible, although we can offer no assurance that this process will result in Orion concluding any particular transaction. Beyond the ongoing strategic review efforts, the team has continued to execute and deliver strong results against our business plan, which is reflected in our second quarter results.

Our strategy remains centered on four priorities: stabilizing the portfolio through increased leasing activity, the timely disposition of non-core assets, prudent leverage management, and selective capital recycling into dedicated use assets. As we have consistently communicated, we expect these efforts to drive core FFO per share growth in 2026 and beyond, while maintaining prudent levels of leverage.

Far this year, we have been successful on each of those priorities. From a leasing perspective, we have completed 673,000 square feet of leasing, including 202,000 square feet completed in the second quarter and 116,000 square feet after quarter end, including our first new lease at our Tulsa property.

The weighted average lease term for the consolidated portfolio stands at 6.2 years at the end of the second quarter, up from 5.5 years at the end of the second quarter last year, continuing our steady improvement of this crucial metric. Cash rent spreads on second quarter renewals were down 7.7% when comparing ending rents in the current term to starting rents in the new term.

However, rent spreads are up 2.1% when comparing current ending rents to new ending rents, driven by escalations over the new lease term. For the year-to-date period, cash rent spreads are very slightly down, by 0.2% on renewals, and up 7.1% when comparing current ending rents to new ending rents.

Although volatile, leasing concessions are so far trending lower this year than last on a per-square-foot basis. Due to a few scheduled move-outs and select opportunistic dispositions, offset to some extent by our leasing efforts, our consolidated portfolio occupancy rate of 78.1% at the end of the second quarter was down, as expected, from the end of the first quarter, but up from 76.8% at the end of the second quarter of last year.

As we have said many times, rent spreads and occupancy rates can and will be volatile from quarter to quarter, given our largely single-tenant portfolio, though we remain positive about the overall trends, which continue to see steady improvement. Beyond the leasing completed year-to-date, our pipeline remains quite strong despite our smaller size, at over 1.1 million square feet, or over 17% of the total portfolio, that is in either discussion or documentation stage, including a substantial number of new, long-term leases for currently vacant space and some full building renewals.

As we look out, we continue to see improving demand for our assets, and we are working hard to move forward on executing as much leasing as possible. The key message is that we continue to be quite pleased with our leasing velocity so far this year.

Turning to dispositions, we have been very successful this year, and we have primarily utilized proceeds from opportunistic asset sale activity to continue to deleverage, ending the quarter with net debt to annualized adjusted EBITDA at 5.4 times, almost a full turn better than last quarter and the same quarter a year ago. Specifically, during the first half of the year, we generated gross proceeds of almost $84 million on the sale of four properties, plus the 37.4-acre Deerfield, Illinois campus.

The second quarter sales activity generated an aggregate gross sales price of $70.6 million and included two strategic dispositions, one of which was sold to the existing tenant at a 5.6% cash capitalization rate, and the other was a recently vacated asset sold to an adjacent user at an implied 5% cash capitalization rate on expiring rent. These sales have allowed us to repay roughly $61 million of debt, including over $35 million on our CMBS loan in the second quarter.

Our debt repayment and refinance efforts have also allowed us to steadily reduce interest expense by $700,000 for the second quarter and $1.6 million for the year-to-date period compared to the same periods in 2025. On another very positive note, the average sales price per square foot has steadily increased on the sale of vacant properties over the past year or so.

These transactions continue to demonstrate our ability to monetize non-core assets and redeploy capital while improving the overall quality and durability of our remaining portfolio. Our continued focus on selling properties with difficult releasing prospects and high carrying costs has allowed us to continue to materially reduce property operating expenses.

For example, our 2025 and 2026 vacant or near-term vacant property sales are estimated to save more than $12 million in annual carrying costs. These efforts have already contributed to an improvement in property operating costs of $3.4 million for the second quarter and $5.1 million for the year-to-date period compared to the same periods in 2025.

We remain committed to shifting our portfolio concentration toward dedicated use assets, where our tenants perform work that cannot be replicated from home or relocated to a generic office setting, and away from traditional suburban office properties. These property types include medical, lab, R&D, flex, and government properties, all of which we already own.

At quarter end, these dedicated use assets, or DUA, represent 38.7% of annualized base rent of our consolidated portfolio, compared to 37.1% at the end of last quarter and 32.6% at the end of the second quarter of 2025, reflecting our sales of traditional office assets and our purchase earlier this year of the Barilla DUA property. We expect this percentage to continue increasing over time through continued disposition activity of traditional office and targeted acquisitions of DUA properties.

Before I close, I do want to take a moment to reflect on the very significant progress we have made at Orion. Over the past two years, we have averaged about 1 million square feet of leasing per year and are on track to lease about that much again this year.

We have sold 39 properties since our spin, totaling more than 4.2 million square feet, reducing property operating expenses by millions per year. We continue to work to manage overhead, significantly reducing headcount over the past two years, including at the executive level.

We successfully refinanced and extended both our revolving debt and our CMBS debt this year. We continue to manage leverage and have steadily reduced debt by $183 million since the spin.

These combined efforts are showing up in our key metrics, such as WALT, occupancy, net debt to adjusted EBITDA, and G&A, all of which are improved over the same period a year ago. Finally, we have significant confidence in our ability to meaningfully grow core FFO from here.

For the balance of 2026, our operational focus remains on improving portfolio quality, lengthening WALT, renewing tenants, filling or selling vacant space, and prudently managing expenses and leverage as we work to maximize Orion's value for investors and potential strategic partners. I firmly believe that if we continue to execute on our business plan, the market will finally begin to recognize the meaningful intrinsic value of this company that is not reflected in our current discounted valuation.

With that, I will turn the call over to Gavin.

Thanks, Paul. For the second quarter of 2026, compared to the second quarter of 2025, Orion had total revenues of $34.3 million, compared to $37.3 million.

Net income was $24.6 million, or 43 cents per share, in the second quarter of 2026, and included a gain of $28.8 million, primarily related from the opportunistic sale of two of our operating properties during the quarter. This non-recurring gain does not impact our core FFO results, which were $11.8 million, or 20 cents per share, basically flat compared to the same quarter in 2025.

Adjusted EBITDA was $17.2 million, versus $18 million in the same quarter of 2025. G&A in the second quarter improved to $4.6 million, compared to $4.8 million in the same quarter of 2025, as we benefit from the decision to continue to lower headcount through attrition and other means.

G&A expense includes the ongoing cost related to the strategic review, which we equate to approximately $100,000 in the second quarter of 2026 and $200,000 year-to-date. CapEx and leasing costs in the second quarter were $8.9 million, compared to $15.6 million in the same quarter of 2025.

As we have previously discussed, CapEx timing is dependent on when leases are executed and work is completed on properties. Turning to the balance sheet, our net debt to annualized adjusted EBITDA was 5.4 times at quarter end, compared to 6.4 times at the end of the second quarter of 2025.

As of June 30th, we had total liquidity of approximately $177 million, comprised of $63.5 million of cash and cash equivalents and restricted cash, and $113 million of available capacity under our credit facility revolver. Given our strong efforts to sell non-core and select operating properties, we have significantly lowered debt outstanding and extended maturities.

We end of the quarter with $436.6 million of outstanding debt, compared to $483 million a year ago, excluding a proportionate share of the unconsolidated joint ventures' debt. Our next significant maturity is not until February of 2028, which we have an option to extend until February of 2029.

Our net debt to gross real estate assets was 27.9% at the end of the quarter, compared to 29.5% a year ago. On August 5th, Orion's Board of Directors declared a quarterly cash dividend of 2 cents per share for the third quarter of 2026, payable on October 15th, 2026, to stockholders on record as of September 30th, 2026.

Moving to our outlook for 2026, we are narrowing and raising the range for our core FFO, lowering the range for our net debt to adjusted EBITDA, and reaffirming our expectations for G&A. Core FFO for the year is now expected to range from 72 cents to 77 cents per diluted share, up from our previously affirmed range of 69 cents to 76 cents per diluted share.

Net debt to adjusted EBITDA is now expected to range from 6 to 6.8 times, down from our previous range of 6.5 to 7.3 times. These improvements in our guidance for the year are driven by several factors, including recurring items such as actively reducing property operating expenses and improved leasing expectations, as well as one-time items such as lease termination income and property tax appeals and refunds.

Our G&A range of $19.8 million to $20.8 million is unchanged. With that, we will open the line for questions.

Operator?

Congrats on the quarter. One asset for sale today, it seems like.

I'm curious about your decision to potentially sell an asset leased to the government, which is kind of meets your criteria for the existing portfolio.

Hey Mitch, this is Chris. Thanks for dialing in.

The asset that we're under contract to sell, it's one where the government's looking to downsize on that asset, there is some risk around the government tenancy in that one asset. Plus, it's in a very remote area, and it's one that we analyzed the disposition of it and thought that that's the best overall outcome for that asset.

That's super helpful. There are four vacant assets in the portfolio.

It's pretty amazing, I think, at one point you had 11 or 12. Tell me about the decision that and process that you guys go through regarding either to sell or to release.

Mitch, it's been a pretty consistent process, it's evolved over time, as you might imagine. We sort of look really hard at the asset and say, is this an asset that we think it's worth putting money into and leasing up over time, or is this an asset that's going to cost us either a lot of money to re-tenant or really just doesn't have, in our view, the long-term demand factors present?

We've obviously sold a lot of vacant assets, but we've also been pretty successful in leasing some assets up. For example, we thought it made sense to put money into our asset in Parsippany, New Jersey.

We put that money in, that asset is leasing up pretty well. I think the same is true with our Buffalo property.

We looked at that property and thought that's a Class A building in downtown Buffalo, we think we can lease that up. We migrated our tenant Ingram Micro into that building, and we've got some strong momentum on leasing in the building from other tenants.

We feel good about that. It's sort of an ongoing and dynamic process, but we're fortunate in that we have moved most of the vacant properties off our balance sheet, and we have a few left.

Some we have quite a bit of confidence about leasing up, for example, the Tulsa property, we just put our first lease into that property, and others we're sort of evaluating whether we think in the long term we're going to get leasing momentum or not.

Gotcha. 57 assets, 6.4 million square feet.

What percentage would you characterize to be kind of non-core at this point?

We make that judgment based upon our expectations for long-term leases. I would say it's just a few percent at this stage.

We feel pretty confident about the assets we have left, and our ability to keep those properties leased or to lease them up if they are vacant or become vacant. We're always going to look at it.

We may have some vacant sales over the course of the year, but we just have to see how leasing shapes up.

Great. Last one for me.

Paul, I really truly appreciate the follow-up and perspective you're providing regarding your strategic review. Not so many management teams are as transparent regarding the process.

To that end, will there be a formal announcement? Obviously, if something happens, we'll know, but will there be a formal announcement if you decide to continue to operate?

Is that a plan here? Yeah, [coughs]

Look, Mitch, thank you very much for the transparency. We want to be as transparent as we possibly can be.

We know this process has been going on for a long time. We don't control a lot of the timing.

We're interacting with third parties, and they control the timing to some degree. We're trying to move as expeditiously as possible.

When we come to a conclusion of the process, whatever that is, we will make an announcement. We're just not there yet, and when we do get there, we'll let everyone know.

That includes if we decide to move forward with our independent business plan.

Thank you.

Hey guys, apologies, I thought I had dialed in. Thanks for taking the question,

and

congrats on the continued progress. I thought you guys had a really good quarter.

I guess following up on kind of the portfolio, you said you had a few percentage left. Kind of piggybacking on that, what percentage are you looking to get those dedicated use assets to in kind of the near term, and then over the long term, call it 3 to 5 years out?

It's a good question. I think a lot of it, when you think about the longer-term component, that is the 3 to 5 years out, that will be dependent to some degree on our access to outside capital.

At the moment, our share price doesn't support that, we have to work within our existing portfolio. To the extent we're working within our existing portfolio, the progress will be steady, but incremental, as we recycle capital, we'll sell assets, and we might occasionally buy DUA assets.

We'll slowly build that up over time. To the extent we get access to outside capital, we would expect that transition to occur much more rapidly.

The longer-term goals are of course to have well more than a majority of the portfolio in DUA assets. The timing of that is yet to be determined.

Perfect. I appreciate the color there.

Then I know that the CapEx is kind of a chunky number and can bounce around from quarter to quarter, but do you guys have any idea of what you are expecting kind of across the remainder of the year?

Just hang on. Just 1 second.

Okay. Far this year, we've spent about, call it, $27 million in CapEx.

We use that term broadly, meaning that includes building and site updates that we've done to update our buildings, tenant improvements, and lease incentives, and then leasing commissions. It's a pretty volatile number because we don't know when tenants are going to draw down on existing obligations that we have, which is disclosed in our 10-Q.

We expect for the remainder of the year, that total number of additional CapEx from here could range from anywhere from $30 to $40 million.

Got it. That's helpful.

We've modeled that in, this is in expectation, our guidance incorporates those expectations.

Perfect. That's very helpful.

Then you talked a little bit about Tulsa starting to lease up. It's good to see somebody going in there.

How are discussions going for the remainder of that building, and what's your confidence level there to kind of strengthen the occupancy at that specific site?

I think our confidence is relatively high. It's a very high-quality building in downtown Tulsa.

There's not a lot of competing product of that quality. Sort of if you're looking for Class A space, we're the ones you go to look to.

We've got one lease done, and we're in discussion on at least one more of relatively significant size. We sort of feel pretty good about that over time.

Awesome. That's great.

Thank you, guys, for taking the questions and sneaking me in last minute. Appreciate it.

No problem.

Thank you very much.

Thank you, everyone, for joining us on the call, and we look forward to updating you again at our third quarter call in the fall.