Phillips Edison & Company, Inc.

Good day and welcome to Phillips Edison and Company's second quarter 2025 earnings call. Please note that this call is being recorded. I will now turn the call over to Kimberly Green, Head of Investor Relations. Kimberly, you may begin.

Thank you, Operator. I'm joined on this call by our Chairman and Chief Executive Officer Jeff Edison, President Bob Myers, and Chief Financial Officer John Caulfield. Once we conclude our prepared remarks, we will open a call to Q&A. After today's call, an archived version will be published on our website. As a reminder, today's discussion may contain forward-looking statements about the company's view of future business and financial performance, including forward earnings guidance and future market conditions. These are based on management's current beliefs and expectations and are subject to various risks and uncertainties as described in our SEC filing. specifically in our most recent Form 10-K and 10-Q. And our discussion today will reference certain non-GAAP financial measures. Information regarding our use of these measures and reconciliations of these measures to our GAAP results are available in our earnings press release and supplemental information packet, which have been posted on our website. Please note that we have also posted a presentation with additional information. Our caution on forward-looking statements also applies to these materials. Now I'd like to turn the call over to Jeff Edison, our Chief Executive Officer.

Jeff? Thank you, Kim, and thank you everyone for joining us today. The PICO team is pleased to deliver another quarter of solid growth. Same Center NOI increased 4.2% and Core FFO per share increased 8.5%. Given the continued strength of our business, we are pleased to increase our full year 2025 earnings guidance for Same Center NOI, Core FFO Per Share, and Nareit FFO Per Share. I'd like to thank our PICO associates for their hard work in maintaining our unique competitive advantages and driving value at the property level. We believe PICO's Broker Anchor Strategy and necessity-based focus have helped to create a resilient portfolio that also delivers steady growth We are driving strong rent spreads, increasing occupancy and generating dependable, high quality cash flows. This consistency in performance and growth is attributable to several factors. First and foremost, it takes an experienced and locally smart team to bring the best retailers to our centers. Our neighbors create positive community experiences built around our grocers. Second, It takes decades to build a strong grocer and national neighbor relationships that PECO enjoys. These relationships give us an advantage in working together to optimize our properties. These relationships also are critical to our acquisition strategy. Third, it requires a portfolio focused on right size neighborhood centers located in suburban trade areas with compelling demographic trends and continued macroeconomic tailwinds. Strong demand from national retailers continues to fill our pipeline of ground up out parcel development and repositioning activity. Fourth, it takes a dedicated team to acquire and curate a high quality gross ranker portfolio that is expected to deliver three to 4% same center NOI growth year after year. And lastly, it requires a strong balance sheet with great liquidity to invest in the properties and the portfolio. Our long operating history and track record have built these strengths for PICO that give us both offensive and defensive advantages in the market. Because of these advantages, we believe PICO is able to deliver mid to high single-digit core FFO for share growth annually on a long-term basis. The market continues to focus on tariffs and U.S. economic stability. As it relates to PICO's grocers and neighbors, we feel very good about our portfolio. As a reminder, 70% of our ABR comes from necessity-based goods and services. This provides predictable, high-quality cash flows and downside protection quarter after quarter. This also limits our exposure to discretionary goods, which are at risk of greater impact from tariffs. We estimate that approximately 85% of our neighbors based on ABR will experience limited impact from tariffs. Supporting that estimate is the strength of our neighbor retention and leasing spreads in the second quarter, which Bob will speak about in a moment. Our neighbors are watching the consumer closely. They continue to benefit from their location in the neighborhood where our top grocers drive strong foot traffic to our centers. We continue to see leasing demand for our existing spaces along with a healthy development and redevelopment pipeline. We are seeing strong demand from retailers who want to be located at PICO's grocery-anchored neighborhood shopping centers, especially from small shop retailers in categories like quick service restaurants, health and beauty, medical retail, and personal services. These are the types of neighbors that perform well because they are part of people's everyday routines. And importantly, the PICO team continues to find smart, accretive acquisitions that add long-term value to our portfolio. Our active acquisitions activity is another differentiator in PICO strategy. The PICO team is acquiring in the market through all cycles. carefully and deliberately acquiring centers that fit our growth-ranked strategy and right-size format, while also delivering long-term growth potential. This has been part of our DNA for over 30 years. We're not just maintaining a high-quality portfolio, we're building one. What sets PICO apart is that we know exactly what we're looking for, and we have one of the best operating platforms to act quickly and execute. And that puts PICO in a unique position to grow cash flows in a way that's both disciplined and opportunistic. During the second quarter, we purchased $133 million of assets in PICO's total share. When you include assets acquired subsequent to quarter end, this brings our year-to-date gross acquisitions at PICO's share to $287 million. Despite recent market volatility, We remain confident in our ability to acquire high quality centers at attractive returns. We are pleased to affirm our guidance range of 350 to $450 million in gross acquisitions this year. We continue to successfully find attractive acquisition opportunities below replacement costs with strong growth profiles that we believe will exceed our unlevered 9% IRR target. We will acquire more if attractive opportunities materialize, but we are comfortable with our current pace and IRR targets. We will continue to be disciplined buyers as we look forward. In summary, we are very pleased with our results this quarter and our ability to raise guidance for the remainder of the year. While it is still early to understand the full impact tariffs could have on PICO or our neighbors, we continue to see a resilient consumer. and we believe our portfolio will outperform as retailer demand remains strong. Our confidence is driven by the stability of our high quality cash flows and the PICO team's ability to deliver solid growth and create value for our shareholders. Given our demonstrated track record through various cycles, we believe an investment in PICO provides shareholders with a favorable balance of defense and offense. In summary, We believe the quality of our cash flows reduces our beta, and the strength of our growth increases our alpha. Less beta, more alpha. I will now turn the call over to Bob.