Industrial Logistics Properties Trust

Good morning, and welcome to the Industrial Logistics Properties Trust fourth quarter 2021 earnings conference call. All participants will be in listen-only mode. Should you need assistance, please signal 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 this event is being recorded. I'd now like to turn the conference over to Kevin Barry, Director of Investor Relations. Please go ahead.

Good morning, everyone, and thank you for joining us today. With me on the call are ILPT's Chief Executive Officer, John Murray, Chief Financial Officer, Rick Seidel, and Chief Operating Officer, Yael Duffy. In just a moment, they will provide details about our business and our performance for the fourth quarter of 2021, followed by a question and answer session with sell-side analysts. First, I would like to note that the recording and retransmission of today's conference call is prohibited without the prior written consent of the company. Also note that today's conference call contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other securities laws. These forward-looking statements are based on ILPT's beliefs and expectations as of today, Wednesday, February 16, 2022, and actual results may differ materially from those that we project. The company undertakes no obligation to revise or publicly release the results of any revision to the forward-looking statements made in today's conference call. Additional information concerning factors that could cause those differences is contained in our filings with the Securities and Exchange Commission, or SEC, which can be accessed from our website, ILPTREIT.com, or the SEC's website. Investors are cautioned not to place undue reliance upon any forward-looking statements. In addition, we will be discussing non-GAAP numbers during this call, including normalized funds from operations, or normalized FFO, adjusted EBITDA, and cash-based net operating income, or cash basis NOI. A reconciliation of these non-GAAP figures, the net income, and the components to calculate cash available for distribution, or CAD, are available in our Supplemental Operating and Financial Data Package, which also can be found on our website. With that, I want to now turn the call over to John.

Thank you, Kevin. Good morning, everyone, and welcome to the fourth quarter earnings call for Industrial Logistics Properties Trust. On today's call, I will provide a summary of our performance for the fourth quarter and give an update on our planned acquisition of Monmouth Real Estate Investment Corporation. I'll then turn the call over to Yael and Rick for additional color on ILPT's leasing activity and financial results. We finished the year with strong leasing momentum and solid growth. During the quarter, we entered new and renewal leases and completed rent resets for approximately 1.6 million square feet at weighted average rental rates that were over 15% higher than prior rental rates for the same space. Portfolio occupancy increased to 99.2% at year end. We achieved normalized FFO growth of 5% and same property cash basis NOI growth accelerated to 4.5%. In late December, we announced the sale of six recently acquired properties to our joint venture for an aggregate price of $206 million, representing a gain of $11 million and a cap rate below 5%. The six properties contain 2.5 million square feet of industrial space, and they have a weighted average remaining lease term of four years. With this sale, our joint venture now owns 18 industrial properties in 12 states with a total of 11.7 million square feet of space. ILPT continues to own a 22% equity interest in the joint venture, and we plan to place approximately $134 million of mortgage debt on these six properties. Upon completion of the related debt financing, ILPT's total net proceeds from this joint venture transaction will be approximately $190 million. This illustrates the value of ILPT's high-quality industrial portfolio and also demonstrates the strength and growth potential of our relationships with strong institutional private capital partners. Our access to private sources of equity capital through our joint venture represents a compelling strategy for ILPT to raise equity capital at property level and asset value and enhance our balance sheet to support our growth priorities. Since our November announcement that ILPT agreed to acquire Monmouth for approximately $4 billion, we have been focused on executing our financing and integration plans, so we are ready to successfully complete this accretive transaction. The level of initial joint venture equity capital assumed and newly placed secured debt and possible asset sales remains in line with the ranges we have discussed since November. ILPT has a proven track record of successfully executing portfolio acquisitions, and we are confident that the depth of real estate operations and asset management expertise provided by our manager, the RMR Group, will enable us to efficiently integrate the new assets into ILPT's portfolio. Tomorrow, Monmouth will have its shareholder meeting to vote on the proposed merger with ILPT. Assuming Monmouth shareholder approval, we expect to close the transaction later this month and remain very excited about the benefits of this acquisition for our company. It creates a stronger ILPT with enhanced scale, additional high-quality e-commerce-focused mainland properties, and increased tenant and geographic diversity. We do not plan to provide greater detail on our financing of the Monmouth acquisition in advance of tomorrow's shareholder vote. Assuming a positive vote, we expect to provide more specific details in a press release following the closing of the transaction later this month. Now I'll turn the call over to Yada.