Strawberry Fields REIT, Inc.

Good morning. My name is Holly, and I will be your conference operator today. I would like to welcome everyone to the Strawberry Fields REIT first quarter 2025 earnings call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I would now like to turn the conference over to Jeff Beitner, Chief Investment Officer. Sir, please go ahead.

Thank you and welcome to Strawberry Field's REITs Q1 2025 earnings call. I am the Chief Investment Officer and joining me on the call today are Maish Gubin, our Chairman and CEO, and Greg Flamian, our CFO. Earlier today, the company issued its Q1 2025 earnings results, which are available on the company's investor relations website. Participants should be aware that this call is being recorded and listeners are advised that any forward-looking statements made on today's call are based on management's current expectations, assumptions, and beliefs about Strawberry Field's REITs business and the environment in which it operates. These statements may include projections regarding future financial performance. dividends, acquisitions, investments, returns, financings, and may or may not reference other matters affecting the company's business or the businesses of its tenants, including factors that are beyond its control. Additionally, references will be made during this call to non-GAAP financial results. Investors are encouraged to review these non-GAAP financial measures, as well as the explanation and reconciliation of these measures, to the comparable GAAP results included on the non-GAAP measure reconciliation page in our investor presentation. And now, on to discussing Strawberry Fields REIT and our Q1 2025 performance. I wanted to start by sharing some key highlights. During the quarter, the company collected 100% of its contractual rents. On January 2nd, the company closed the acquisition for the purchase of six healthcare facilities located in Kansas. The purchase price for the facilities was $24 million and released under a new 10-year master lease agreement. Under the master lease, the tenants will be on a triple net basis and the tenants have two five-year options to extend the lease. The facilities are operated as five skilled nursing facilities and one assisted living facility and are comprised of 354 licensed beds. We welcome Willie and Michelle Novotny of Adveno Living to the Strawberry Field Treat family, and we look forward to growing with them. On March 31st, the company completed the acquisition for a skilled nursing facility with 100 licensed beds near Oklahoma City. The acquisition was for $5 million, and the company funded the acquisition utilizing cash from the balance sheet. The facility was leased to an existing tenant who combined this facility with another facility they acquired in December 2024 to create a master lease. This lease included annual base rents of $500,000 with 3% annual rent increases and is for an initial term of 10 years with two five-year options to extend the lease. A few other items I wanted to point out. During the quarter, the company continued to pay its quarterly dividend and on March 31st made a payment of $0.14 a share. We also made a couple of new hires during the quarter, an asset manager and a lawyer. These hires reflect the company's expanding footprint and the need to grow the team accordingly. The only other hire we anticipate in the near future is another asset manager. Subsequent to quarter-end, the company purchased a 112-bed facility near Houston, Texas, comprised of 102 skilled nursing beds and 10 assisted living beds. The acquisition was for $11.5 million, and the company funded the acquisition utilizing cash from the balance sheet. The property will be added to an existing master lease in Texas. As a result of this acquisition, the annual rents for this master lease increase by $1.278 million, and this master lease is subject to 3% annual rent increases. With this acquisition in Houston, the company has completed over $40 million in acquisitions to date in 2025. We are working diligently on some deals and expect that number to be closer to $100 million by the end of Q2. I would now like to have Greg Flamian, our Chief Financial Officer, discuss the quarter-end financials.

Thank you, Jeff, and welcome to the Strawberry Field's Q1 2025 earnings call. I would like to start off by looking at our financials for the first quarter of 2025. Total assets increased by $199 million, or 31.5%, compared to Q1 2024. This growth was primarily driven by activity related to our 2024-2025 real estate acquisitions, as well as the retenanting of the Landmark Master Lease into the Kentucky Master Lease. On the liabilities and equity side, we also saw an increase largely attributable to the funding used to finance these acquisitions. Turning to the income statement, total revenue for Q1 2025 was $37.3 million, up from $27.8 million in the same period last year. representing a 34.1% year-over-year increase. This growth was fueled by the timing of our key acquisitions over the past 12 months, including the Missouri master lease, which closed in December 2024, as well as the retention of existing leases, most notably the landmark to Kentucky master lease, which transitioned, which started in January 2025. Net income for the quarter was 6.99 million or 13 cents a share compared to 5.99 million or 12 cents a share in Q1 2024. This increase reflects higher revenue partially offset by increases in depreciation, amortization and interest expenses. Now moving on to financial highlights, AFFO for Q1 2025 was $16.8 million up from 13.1 million a year ago, representing a 28% increase. Based on these results, we are projecting full year 2025 AFFO of 67.3 million, which would represent a 20% year-over-year growth. Please note that the projection is based solely on the annualization of Q1 results and does not include any contribution from future acquisitions. With this projection, we expect our AFFO CAGR to be 13.8%. Adjusted EBITDA for Q1 2025 came in at $30.4 million compared to $21.4 million in Q1 2024, marking a 42% year-over-year increase. We are projecting a full year 2025 adjusted EBITDA of $128.8 million, again, based on analyzed Q1 results and excluding the impact of future acquisitions. Based on this forecast, we can expect an adjusted EBITDA CAGR of 12.2%. Finally, I want to touch on our dividend. As of March 31st, 2025, our dividend yield was 4.7% with an annualized AFFO payout ratio of 46.2%. Both metrics remain below the average of peers in our sector, reflecting our commitment to retain capital in support of an active and robust acquisition pipeline. Looking ahead, we will continue to evaluate opportunities for dividend growth and remain committed to aligning future increases with the strength of our underlying performance. And now Moesh Gubin will continue the presentation with the portfolio highlights.