Mobile Infrastructure Corporation

Good afternoon and welcome to the Mobile Infrastructure Corporation fourth quarter and full year 2025 earnings conference call. At this time, all participants are in the listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during this session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I will now turn the call over to Casey Cotery, 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 2025 performance. With us today from Mobile are Stephanie Hogue, CEO, Paul Gore, BFO, and Manuel Chavez, Executive Chairman. In a moment, we will hear management statements about the company's results of operations as of the fourth quarter and full year 2025. Before we begin, we would like to remind everyone that today's discussion includes forward-looking statements, including projections and estimates of future events, business or industry trends, or business or financial results. Actual results may vary significantly from these statements. and may be affected by the risks Mobile has identified in today's press release and those identified in its filings with the SEC, including Mobile's most recent annual report on Form 10-K and its most recent quarterly report on Form 10-Q. Mobile assumes no obligation and does not intend to update or comment on forward-looking statements made on this call. Today's discussion also contains references to non-GAAP financial measures that Mobile believes provide useful information to its investors. These non-GAAP measures should not be considered in isolation from or as a substitute for GAAP results. Mobile's earnings release and the most recent quarterly report on Form 10-Q provide a reconciliation of those measures and the most directly comparable GAAP measures and a list of the reasons why Mobile uses these measures. I will now turn the call over to Mobile's CEO, Stephanie Hogue, to discuss fourth quarter and full year 2025 performance. Stephanie?

Thank you, Casey, and good afternoon, everyone. Thank you for joining us today. 2025 was a year in which we strengthened the foundation of our business. And while we did not achieve the growth that we originally expected, we executed on several key strategic priorities, which have positioned the company for future growth and to capitalize on the green shoots we are seeing throughout the portfolio. While consolidated revenue and NOI declined year over year, the underlying structure of the company improved meaningfully. We continued to show positive momentum in contract parking, improved utilization at several of our assets, completed phase one of our asset rotation strategy, strengthened our balance sheet, and our confidence is growing with identifiable catalysts that position us for progress in 2026. Additionally, accelerating return to office momentum across our markets supports our outlook for growth in 2026. along with the reopening of several venues that should increase our transient volumes this year. Taking a closer look at 2025 operations, let me start with contract parking, because that forms the operational base that supports our broader growth. We ended 2025 with over 6,700 contracts in our baseline assets, representing same store sales growth of 10% year over year, and 12% growth when excluding the temporary disruption in Detroit. Contract parking represents approximately 35% of our management agreement revenue. This recurring revenue creates stability, reduces volatility, and builds a platform for pricing leverage as utilization improves. As we have focused on driving utilization across the portfolio, we have done so with a specific tested playbook for success. Volume first, rate second. In some assets, we have accepted lower initial price points per stall per day to ensure we are winning market share volume and stabilizing assets. In other words, our priority in 2025 was occupancy. The result is that while utilization has climbed with contract growth, our overall revenue mix has remained relatively steady at approximately 35%, which is a deliberate sequencing decision. Parking is fundamentally a utilization-driven business with daily perishable inventory. When assets are underutilized, pricing leverage is limited. As assets move towards stabilized occupancy, optionality increases both with rate and Parker Mix optimization. Cleveland demonstrates this clearly. As utilization approached stabilized levels in that market, we were able to implement approximately 5% rate increases on monthly contracts. We have developed an optimization plan for each of our core assets. In some markets, the near-term priority will remain volume. while in others where utilization is tightening, the focus will shift toward parker mix optimization and pricing discipline. The opportunity ahead of us is not simply to grow contracts, but to enhance the quality of that revenue as assets continue to mature. So while contract revenue today represents 35% of the mix, we view that as a baseline off of which we intend to grow over time. As utilization continues to increase and market conditions normalize, we believe there's meaningful opportunity to improve pricing and strengthen the overall revenue composition of the portfolio. We are also seeing tangible signs that demand dynamics are shifting. For several years, return to office was something we expected would eventually translate into parking demand. Over the last several months, that shift has become more measurable. We are seeing an increase in inbound block parking inquiries, something that we have not experienced in nearly five years, To be clear, we are not back to pre-pandemic patterns, but corporate in-office attendance policies are beginning to drive incremental demand in a way that will translate to increased utilization in markets where we have exposure to office. Residential parking contracts have been another contributor to our emphasis on building the mobile recurring revenue platform. Residential contracts increased approximately 60% year over year in 2025, reflecting the conversion of downtown office buildings in several of our markets to apartment rentals. That group diversifies our exposure and transforms assets that were historically weekday-centric into 24-hour revenue platforms. Over time, that flexibility enhances our ability to optimize both utilization and pricing. Now turning to transient revenue. Transient volumes declined 6% in 2025, primarily due to temporary disruptions in certain markets that we have discussed in recent earnings calls. These were micro market disruptions tied to physical projects and timing that will ultimately create long-term demand for our assets. Importantly, even during this period, transient rates increased. That rate resilience reinforces our conviction that our assets remain well positioned within these districts. As we move into 2026, many of these temporary disruptions are shifting to positive demand catalysts. The renovated Cincinnati Convention Center has reopened, and construction projects such as the 16th Street Mall redevelopment in Denver and Nashville's Second Avenue rebuild have been completed, and we have new contract winds being onboarded. This disability gives us confidence in sequential improvements as the year progresses. Over the past year, we have pivoted our own data strategy to identify the technology platforms that enhance customer experience, improve revenue management, and reduce structural management costs. In certain high volume assets, we have identified some barriers to revenue management, and those operational initiatives have not yet produced the operational fluidity and throughput we expect. Actions are underway to further improve utilization across our portfolio. which includes reexamining our technology being used across the mobile portfolio. We look forward to sharing more about these operational initiatives in the future. A key highlight of 2025 was the execution of phase one of our asset rotation strategy. Consistent with the objectives we outlined at this time last year, we have sold or are under contract to sell over 30 million of non-core assets. The aggregate cap rate of sold assets is approximately 2% to date, which supports our ongoing belief that the sum of the mobile portfolio as expressed through the stock price is materially disconnected from the value of the parts. We are continuing to execute on this three-year strategy in 2026 when we expect to have sold or be in contract to sell another large portion of our non-core assets. In the third quarter, we completed a $100 million asset-backed securitization with three new institutional investors. That transaction extended maturities, enhanced flexibility around asset rotation, and validated the quality of our underlying collateral. Finally, and equally importantly, we continued to deleverage the portfolio with approximately a $10 million paydown of the line of credit in the fourth quarter. Hanging down the line of credit and reducing the overall cost of capital will continue to be a primary consideration of capital deployment through 2026. This, coupled with our stock repurchase program and potential asset purchases, form the core of our capital allocation strategy to drive long-term value to shareholders. Despite the green sheets in our business and excitement for 2026, I also think it is important to step back and acknowledge the broader environment in which we are operating. We are living through a moment of extraordinary uncertainty around how artificial intelligence will reshape the nature of work, office usage, and even human productivity itself. But regardless of how technology evolves, people will continue to gather, transact, attend events, live in cities, and move through physical space. Mobile infrastructure owns hard assets, land and access points, and central business districts that are essential to that movement. While near-term NOI may fluctuate as markets normalize, the underlying scarcity and strategic positioning of well-located urban land will not be disrupted by an evolving AI landscape. Over time, we believe that ownership of critical physical infrastructure and vibrant districts only becomes more valuable. With that, I will turn the call over to Paul to address the financial results and earnings guidance for 2026.