Creative Media

Good morning everyone and welcome to the Creative Media and Community Trust fourth quarter 2024 earnings conference call. All participants will be in a 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 and then one using a touch-tone telephone. To withdraw your questions, you may press star and two. Please also note today's event is being recorded. At this time, I'd like to turn the floor over to Steve Altibrando, Portfolio Oversight. Sir, you may begin.

Hello, everyone, and thank you for joining us. My name is Steve Altibrando, the Portfolio Oversight for CMCT. Also on the call today are 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 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 other factors that are beyond our control or ability to predict. Although we believe 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. Thank you to everyone for joining our call today. I'd like to take a moment to give an update on the progress of our strategic initiatives, and then I'll go over our quarterly results. As we have discussed on previous calls, we remain focused on improving our balance sheet and liquidity and growing our multifamily portfolio, as well as reducing our traditional office assets. In September, we announced actions to address these priorities. Specifically, we announced our intention to place property-level financing on several of our assets and use the proceeds to fully repay and retire our recourse corporate-level credit facility. We made significant progress on this, closing three mortgages since November. and we have used a substantial portion of the proceeds to reduce the balance outstanding on our credit facility, which is now $15 million, down from $169 million at the end of the third quarter. We're working to complete one additional financing, which we expect to close over the coming months, that we expect will provide sufficient proceeds to complete the repayment and full retirement of this recourse credit facility. We are pleased to have made progress on these transactions, particularly in an environment that is very challenging to finance office properties. After we complete this process, the only corporate debt remaining will be our $27 million junior subordinated notes, which have about 10 years of term remaining and no corporate covenants. We also continue to evaluate asset sales with the goal of strengthening our balance sheet, improving our liquidity, and growing our portfolio of premier multifamily assets. Turning to our fourth quarter results, our core FFO improved by approximately $4.5 million from the prior quarter, primarily due to higher NOI, lower interest expense, and lower preferred dividends, which was due to the redemption of preferred shares in the third quarter. Our net operating income increased by $1.6 million from the third quarter, primarily due to our hotel segment, which increased $1.1 million. Our lending and multifamily divisions generated small increases in NOI, while our office segment had a small quarter-over-quarter decline in NOI. With that, I will turn it over to Steve to provide a further update on our development pipeline, the portfolio, and our co-investment activity.