First Capital, Inc.

All participants, please stand by. Your conference is ready to begin. Ladies and gentlemen, thank you for standing by. Welcome to the first Capital REITs Q3 results conference call. During the presentation, all participants will be in a listen-only mode. Afterwards, we will conduct a question and answer session. At that time, if you have a question, please press star 1 on your telephone keypad. I would now like to turn the conference over to Alison. Please proceed with your presentation.

Thank you and good afternoon, everyone. In discussing our financial and operating performance and in responding to your questions during today's call, we may make forward-looking statements. These statements are based on our current estimates and assumptions, many of which are beyond our control and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those expressed or implied in these forward-looking statements. A summary of these underlying assumptions, risks, and uncertainties is contained in our various securities filing, including our Q3 MD&A, our MD&A for the year ended December 31st, 2020, and our current AIF, which are available on CDAR and on our website. These forward-looking statements are made as of today's date and except as required by securities law, we undertake no obligation to publicly update or revise any such statements. During today's call, we will also be referencing certain financial measures that are non-IFRS measures. These do not have standardized meanings prescribed by IFRS and should not be construed as alternatives to net income or cash flow from operating activities determined in accordance with IFRS. Management provides these measures as a complement to IFRS measures to aid in assessing the REITs performance. These non-IFRS measures are further defined and discussed in our MD&A, which should be read in conjunction with this conference call. I will now turn the call over to Adam.

Okay, thank you very much, Allison. Good afternoon, everyone, and thank you for joining us today for our third quarter conference call. In addition to Allison, with me today are several members of the FCR team, including Jordy Robbins and Neil Downey, both of who you will hear from shortly. Our third quarter results are reflective of the momentum that we discussed last quarter when we said that it feels as if we're at a major turning point in terms of the pandemic's impact on our business and the related economic recovery. Our leasing statistics were consistently robust and continue to demonstrate the outcome of pairing high-quality real estate with a passionate team. Occupancy was a solid 95.9%. the same level as Q2. Notwithstanding occupancy was consistent year over year as well, or down 10 basis points to be exact, same property NOI was up a healthy 4.2%, primarily owing to growth in rental rates. As we continue to gravitate towards a more normal environment, we saw improvements in our variable revenues such as parking and income from our hotel in Yorkville. While these variable items are well off their pandemic bottoms, they are not yet back to full income generating capacity. However, the current trend is indicative that we are well on our way. Our bad debt expense also continued to shrink towards more normal levels. We also talked about the strength and value of real estate assets of FCR's caliber in the private markets. This has only been further validated since our last quarterly call. In 2021, we have sold or are under firm agreement to sell roughly $480 million of real estate. Several of these are non-core income-producing properties such as Langley Mall and our properties in Airdrie, Alberta, and the balance are mixed-use developments in Toronto, namely Station Place, King High Line, and Christy Cookie. In these properties, we chose to sell a partial interest to residential focus partners being Centurion REIT, Woodborne and Pemberton Group. A recognition of both the future value of these properties and the importance we attribute to aligned strategic partners. To put our NAV and property sales into context, let's go back to when the pandemic started. Our NAV was $23.39 at the end of 2019, our highest NAV ever up to that point. Then the pandemic struck early in 2020. We were proactive and wrote several of our assets down to reflect what was going on. During 2020, our NAV hit a low point of $22.24, which is a similar level to where we started this year. but a lot has happened since then. Excluding Christy Cookie, the aggregate IFRS value of this year's property sales, including some that are subject to firm agreements with imminent closings, is $257 million. This is relative to a total sale price of those same assets of $330 million. This creates $0.35 per unit of NAP. Christy Cookie added an additional $0.80 per unit of NAV, taking the total NAV creation to $1.15 per unit from property sales alone. That's a lot of annual NAV creation from a pretty small subset of the portfolio. Christy Cookie certainly sways this metric, but even excluding it, the premium to NAV is significant at nearly 30%. Many view these dispositions as a means to lower the debt impact on our balance sheet, which they did, but our view is somewhat more strategic. Since 2019, we have been consistently working to improve the quality of our portfolio and setting FCR up for an even brighter future. The result of which has seen FCR exit virtually all secondary markets, such as Quebec City, Windsor, Trois-Rivières, Sherbrooke, and Red Deer to provide some examples. In Ottawa, we reduced our invested capital without compromising our operating scale by bringing in non-managing partners on assets we owned 100% of. We also sold a number of suburban properties where we believed that the future upside was more limited, such as Halton Hills Village and McLaughlin Corners in Brampton. At the same time, we work diligently to add to our urban portfolio in order to create even stronger positions in these thriving neighborhoods. With tuck-in acquisitions such as 1855 Leslie at Leslie and York Mills, as well as 138 Yorkville and 121 Scholar, both of which Geordie will provide an update on. During this relatively short period of time between 2019 and today, we have disposed of roughly 15% of our portfolio. with all of our IPP dispositions being off the very bottom. At the same time, we invested and expanded our portfolio by roughly 10% during that time with all of that capital invested into the top portion of our asset base. The cumulative impact of these activities resulted in a 25% churn of the portfolio. This is very significant and has effectively converted the bottom of our portfolio into a position of strength both demographically and ultimately financially. Furthermore, our alliances with strategic partners brings both capital and pertinent expertise to our projects. Finally, the majority of this transition was completed quietly during the pandemic. Yes, we sold numerous assets, but more importantly, we improved our asset base. so that it has even more powerful long-term earnings potential in Canada's most sought after markets and neighbourhoods. This is one of the biggest differences between FCR and our peers. There are two main components of our portfolio today. Exceptionally strong, stable, grocery anchored centres in primary markets. These are typically situated in top tier suburbs such as Vaughan, Mississauga and Oakville to use GTA examples. While the urban boundaries haven't changed, markets like these have demonstrated resiliency and became stronger as lifestyles adjusted as a result of the pandemic. While we believe some of this phenomenon is dissipating, we also believe some of the more permanent societal changes will result in a strengthening of the suburban markets within our portfolio today. This increases the opportunity set for FCR given roughly 70% of our portfolio is situated in these top tier neighborhoods. We will look to continuously improve the value of our existing centers, whether it be through merchandising mix enhancements, property improvements, or redevelopment. It is our intent to add more of these centers to the portfolio as well. The other part of our business, is generally grocery-anchored, primarily mixed-use properties in Canada's super-urban neighbourhoods. Examples include Yorkville and Liberty Village, two large ones that alone represent 15% of FCR's total portfolio. Pandemic restrictions and remote work impacted our super-urban assets more than our top tier suburban grocery-anchored portfolio. However, we are clearly seeing even more recovery momentum in these super urban assets, especially our residential rental properties. We also believe, for the same reasons pre-pandemic, that these markets will be the most popular in terms of where people want to live, work, and socialize. And we remain exceptionally well positioned in that regard as well. It's clear that FCR's properties, whether top-tier grocery anchorage centers or mixed-use super urban assets, have never been worth more than they are today. With the world's attention focused on Glasgow this week at the COP26 climate summit, it is clear that our collective efforts related to ESG and the actions we take over the next decade are vital. In Q3, we continue to advance our own ESG goals. In particular, we have made significant progress on our GRESB score. I'm pleased to announce that we ranked number one in our retail peer group. We continue to make steady progress year over year. And I'd like to call out a special thanks to our sustainability and operations teams for their excellent work in driving this achievement. Our Equity, Diversity and Inclusion Council continues to be very busy with a focus on increasing knowledge, awareness and sharing within our team and recently hosted two important keynote speakers, one on raising awareness to living with invisible disabilities and the other on Indigenous inclusion. In recognition of Canada's National Truth and Reconciliation Day on September the 30th, First Capital employees were offered a special learning certificate program provided by the First Nations University of Canada to promote a renewed understanding between Canadians and First Nations. And a final note today, our public art program. This quarter, we reveal two new installations in Toronto. At our Yonge and Roselawn site, FCR engaged three young student illustrators from the Ontario College of Art and Design to paint a mural depicting a positive message of inclusion, diversity and hope. This piece has brought a dynamic vibrancy to the corner, which was formerly a vacant lot, but has now become a community gathering place with local food trucks and pop-up entertainment while we await redevelopment. At 3080 Yonge, our Loblaw City Market grocery-anchored mixed-use property at the corner of Yonge and Lawrence in Toronto, Lighten Up, our most recent public art commission, depicts massive, eye-catching steel balloons suspended above the entrance of the property. These two installations bring our total to 30 public art installations across FCR's portfolio. We look forward to providing more updates on ESG in the future. And in the meantime, we encourage you to please visit our enhanced public art and ESG pages on our website. And with that, I will now turn things over to Neil.