Mobile Infrastructure Corporation

Infrastructure Corporation first quarter and full year 2023 earnings conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Please note today's event is being recorded. I would now like to turn the conference over to Casey Coterie, Investor Relations Representative. Please go ahead.

Thank you, Operator. Good afternoon, everyone, and thank you for joining us to review Mobile's fourth quarter and full year 2023 performance. With us today from Mobile are Manuel Chavez, CEO, and Stephanie Hogue, President and CFO. During this conference call, we will make forward-looking statements to assist you in understanding Mobile Management's expectations about our future performance. These statements are subject to a number of risks that could cause actual events and results to differ materially, and I refer you to our March 14, 2024 press release and our SEC filings for discussions of those risks. In addition, our statements during this call are based on our views as of today. We anticipate that future developments will cause our views to change. Please consider the information presented in that light. We may at some point elect to update the forward-looking statements made today, but specifically disclaim any obligation to do so. I will now turn the call over to Mobile CEO, Manuel Chavez, to discuss fourth quarter and full year 2023 performance. Manuel?

Thank you, Casey, and thank you all for participating in today's call to review our fourth quarter results and discuss our outlook for 2024. As this is our first conference call since listing on the New York Stock Exchange American, I will begin with a brief overview of the company and then discuss fourth quarter business performance and the progress we expect to achieve in 2024. Mobile infrastructure is the owner of a diversified portfolio of 43 parking assets, which are split between garages and lots in 21 markets with an average MSA population of about 2.9 million people, most of whom drive to their destinations. In 2022, this asset portfolio was valued at $520 million by an independent national financial services firm. And since 2022, our net operating income has increased by 9.5%. Thus, while we are a small cap company, our underlying asset base is quite substantial. Our team has deep industry expertise in acquiring and operating parking assets. The parking industry represents an enormous addressable market, yet the vast majority of parking assets are passively managed. In contrast, Our corporate strategy is centered around actively managing each of our assets with the objective of driving utilization, rate optimization, and economies of scale. To support these goals, we have invested in technology infrastructure that provides our team with a unique insight and a differentiated competitive perspective across our entire portfolio. Longer term, we intend to leverage our experience, relationships, and technology to become the acquirer of choice. in the fragmented parking industry. We see secular industry trends that point to the potential for significant value creation, but more on that a little later. With this snapshot of mobile infrastructure as a base, here are the key takeaways from our fourth quarter results. First, we substantially improved the performance of our asset portfolio compared to year-ago levels. we converted 26 of our parking assets from leased to management contracts during the first quarter of 2024. Consistent with our corporate strategy, this transition gives us greater flexibility to optimize rates and utilization and closely manage expenses. And lastly, we entered 2024 with positive business momentum and an improved financial position. We view our parking facilities as infrastructure assets. and it may be constructive to provide more detail into our strategy to actively manage our asset portfolio to increase return. By leveraging our proprietary technology platform, we can work directly with our service providers to customize offerings that address the needs of our customers. This is a key differentiator for us in a fragmented and often passively managed parking industry. For example, We saw growth in hotel overnight traffic in certain markets in the fourth quarter. We offered options like providing hotel guests drive-in and out privileges that can be charged through the hotel room, which creates more yield for us in those overnight guest parking spaces. Also, our technology investments enabled us to rapidly identify special events and conventions in our markets and develop relevant options for those attending, which has resulted in increased parking reservations for us. We take a similar active approach to building the contract parking pipeline and customizing solutions that enhance customer conversions. For example, we carefully track central business district announcements that are near our facilities. In many cases, we put together attractive parking options for potential tenants before they even enter the market. And we are seeing increased transient parking activity in several regions, which we are capturing by offering validations with restaurants, and other retail destinations. As a result of our active management strategy, fourth quarter revenues increased 14% year over year. We are pleased with these top line results, which, when combined with a reduction in operating expenses, resulted in a net operating income growth of 28% in the 2023 fourth quarter. Net operating income, or NOI, is a priority metric for us. as it most closely reflects the performance of our asset portfolio. With 2023 in the rearview mirror, let me share our expectations for the business trends in 2024, as well as our long-term vision for mobile infrastructure. Stephanie will discuss our specific 2024 guidance in a moment. But I can say that the growth we anticipated in 2024, supported by several business trends we saw in the fourth quarter of 2023, namely continued positive momentum in our sales and leasing efforts, improved event-driven rates, and further strengthened hotel traffic. In 2024, revenue and net operating income are expected to benefit from the conversion to management contracts that we completed at the end of 2023. Following a transformational year in 2023, 2024 will be a year in which we accelerate operational improvements as we work to further strengthen the performance of our existing asset portfolio. Over the medium term, we will continue to monitor return to office trends as improvements in these metrics will be a growth tailwind for the business. We are seeing the conversion of commercial to residential in several of our markets, particularly the Midwest. This has the potential to have a significant positive impact on our business. because it creates an overnight demand that historically has not existed in Tier 2 or smaller cities. Also, there has been a loosening of traditional parking requirements associated with new construction, with several cities having lowered or eliminated parking requirements for new developments. This is happening across the U.S. For example, in Cincinnati, the first apartment tower was built without any parking requirements. Similar trends are taking place in Minneapolis and Cleveland. Developers can turn that space into more residential, hospitality, or commercial. This makes the parking assets that are already built and in good standing more valuable to a city, a positive trend for us that should build over time. Our long-term vision is to become the acquirer of choice in the parking industry. Our experience, relationships, and technology infrastructure have attracted substantial interest in what is a fragmented and traditionally single-asset owner market. On our side, we are disciplined, identifying assets that are exposed to multiple demand drivers on adjacent blocks, or as we call them, micro-markets. What I mean by that is that we can have an asset in a smaller, more local market, but if it's surrounded by multiple demand drivers like multifamily residences, hotels, shopping venues, event locations, etc., we have the opportunity to significantly increase net operating income. At this point, I would like to turn over the call to Stephanie Hogue, our President and Chief Financial Officer for Financial Review. Stephanie.