Creative Media

Hello and welcome to the Creative Media and Community Trust Q4 2022 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 from the question queue, please press star, then two. Please note, this event is being recorded. I would now like to turn the conference over to Steve Alto Brando, Portfolio Oversight for CMCT. Please go ahead.

Good morning, everyone, and thank you for joining us. My name is Steve Alto Brando, the Portfolio Oversight for CMCT. Also on the call today is Shaul Kuba, our Chief Investment Officer, David Thompson, our Chief Executive Officer, and Barry Berlin, our Chief Financial Officer. This call is being webcast and will be temporarily archived on the investor relations section of our website, where you can also find our earnings release. Our earnings release includes a reconciliation of non-GAAP financial measures discussed during today's call. During the course of this call, we will make forward-looking statements. These forward-looking statements are based on the beliefs of, assumptions made by, and information currently available to us. Our actual results will be affected by known and unknown risks, trends, uncertainties, and factors that are beyond our control or ability to predict. Although we believe that our assumptions are reasonable, they are not guarantees of future performance, and some will prove to be incorrect. Therefore, our actual future results can be expected to differ from our expectations, and those differences may be material. For a more detailed description of potential risks, please refer to our SEC filings, which can be found in the investor relations section of our website. With that, I'll turn the call over to David Thompson.

Thanks, Steve, and thank you, everyone, for joining our call today. This morning, we announced our fourth quarter 2022 earnings. We're pleased to report that CMCT generated core FFO of 11 cents. We continue to see a strong rebound at our hotel asset, and we also saw an improvement in our office NOI from the prior quarter. In addition, our office lease percentage increased in 2022, despite headwinds nationally for the office sector and the high number of lease expirations we had coming into the year. We believe this speaks to the quality of our portfolio and leasing team. We have quality assets in highly desirable markets and some markets such as Beverly Hills, Culver City, Hollywood, and Austin. Our office assets generally fall into the following categories, ultra-prime location, like 9460 Wilshire and Beverly Hills, best-in-class, like 1 Kaiser in Oakland or Penfield in Austin, or specialty office that we believe is more immune from work-from-home trends, like the medical office concentration we had in Los Angeles at 11600 and 11620 Wilshire, buildings that are located just minutes from the West LA VA Medical Center and UCLA Medical Center. As we continue into 2023, I would like to highlight a few key points about our strategy. First, we are executing on our previously announced plan to grow the multifamily side of our portfolio to achieve more balance between creative office and multifamily. We are seeking newer vintage, highly amenitized premier multifamily assets and high barrier to entry markets. For example, in the first quarter of this year, we acquired two multifamily assets in the Bay Area and one in Los Angeles, totaling 696 units. Shaul will give more color on these exciting investments. Second, we made progress on our value-add and development pipeline. Most notably, we announced earlier this month that we closed a co-investment in construction loan at our 4750 Wilshire property in Los Angeles. The unleased portion of the building is now being converted to luxury residential apartments. We have a significant pipeline of multifamily development opportunities on land we already own. As we have previously mentioned, for value-add and development assets, we will look to co-invest to increase our diversification and supplement returns by generating fee income when ADVAD changes. Third, we reduced our corporate overhead by 28 percent in 2022. This was driven by the permanent reduction in our management fee. And fourth, we took steps to improve our liquidity and balance sheet. This is extremely important in the current environment where capital is becoming more scarce and expensive, and as we consider future opportunities. I would now like to turn the call over to Shao Kuba.