One of the smallest REITs we rate with $1.8 billion in undepreciated real estate assets; Relatively small portfolio of properties and a narrow investment focus; Strong tenant quality with 97.3% of second quarter NOI leased to government users; Weighted average remaining lease term is relatively short compared to office REIT peers at 5.2 years. Leverage metrics remain slightly elevated post the company taking a non-controlling stake in Select Income REIT (SIR, BBB-/Stable/--); High exposure to floating rate debt inflates coverage metrics and exposes the company to interest rate risk; and Recently completed a 30-year senior unsecured notes offering. The stable outlook on Government Properties Income Trust (GOV) reflects our expectation for flat performance from its property portfolio. We believe GOV's
