Industrial Logistics Properties Trust

Good morning and welcome to Industrial Logistics Properties Trust's first quarter 2025 financial results 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 the touchtone phone. To withdraw your question, please press star, then two. Please note this event is being recorded. I would now like to turn the call over to Matt Murphy, Manager of Investor Relations. Please go ahead.

Good morning. Joining me on today's call are ILPT's President and Chief Operating Officer, Yael Duffy, Chief Financial Officer and Treasurer, Tiffany Tsai, and Vice President, Mark Crone. In just a moment, they will provide details about our business and our performance for the first quarter of 2025, followed by a question and answer session with sell-side analysts. Please 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 ILPG's beliefs and expectations as of today, April 30th, 2025, 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, which can be accessed from our website, ILPTREIT.com. Investors are cautioned not to place undue reliance upon any forward-looking statements. In addition, we will be discussing non-GAAP financial measures during this call, including normalized funds from operations, or normalized FFO, adjusted EBITDA RE, net operating income, or NOI, and cash basis NOI. A reconciliation of these non-GAAP measures to net income is available in our financial results package, which can be found on our website. I will now turn the call over to Yael.

Thank you, Matt, and good morning. On today's call, I will provide a brief overview of our portfolio, summarize our first quarter leasing activity, and outline our key areas of focus for the year ahead. Then, Mark will discuss the specifics of our mainland portfolio and leasing pipeline. From there, Tiffany will review our financial results and outlook. We started the year with continued demand for our high-quality portfolio of industrial and logistics properties, consistent with the trends we saw throughout 2024. Cash basis NOI grew by nearly 2% compared to the same period last year, and normalized FFO increased 43% year over year and 52% on a sequential quarter basis. We executed over 2.3 million square feet of total leasing activity with occupancy of 94.6%, reflecting a sequential quarter increase of 20 basis points. As of March 31, 2025, ILTT's portfolio consisted of 411 distribution and logistics properties in 39 states totaling 60 million square feet. Our well-diversified portfolio is further highlighted by our unique Hawaii footprint consisting of 226 properties totaling 16.7 million square feet. Our portfolio has a weighted average lease term of seven years and is anchored by tenants with strong business profiles and stable cash flows. ILPT's top 10 tenants account for 47% of our annualized rental revenues, and more than 76% of our annualized revenues come from investment-grade rated tenants or from our secure Hawaii land leases. Turning to leasing activity. During the first quarter, we signed 13 new and renewal leases, plus one rent reset for over 2.3 million square feet at a weighted average lease term of six years. This resulted in gap in cash leasing spreads of 18.9% and 9.8%. This activity will increase ILPT's annualized rental revenue by $2.9 million, of which 57% has yet to be realized. Our mainland properties accounted for nearly 80% of our renewal activity this quarter, which Mark will provide detail on shortly. Within our Hawaii portfolio, we signed 492,000 square feet of renewals, including rent resets, at rental rates that were 18.2% higher than prior rents with a weighted average lease term of 4.9 years. These results underscore the value of our properties, showcasing our ability to generate organic cash flow growth while also maintaining portfolio stability. Turning to our goals for the year ahead. Like most industry participants, we are monitoring the evolving landscape surrounding global tariffs. While it remains uncertain how these developments may impact tenant demand and the overall leasing environment, we believe ILPT's portfolio of high-quality assets with its diversified tenant roster is well positioned to withstand some short-term volatility. As such, our focus remains on maximizing mark-to-market growth opportunities maintaining strong tenant retention, and leasing the vacancies within our portfolio, specifically the 2.2 million square foot undeveloped land parcel in Hawaii and a 535,000 square foot property in Indianapolis. Another long-term area of focus is evaluating opportunities to improve our balance sheet and reduce leverage. Accordingly, in 2025, we may pursue options to refinance our existing debt and evaluate strategic property dispositions to accomplish these goals. I will now turn the call over to Mark.