Regency Centers Corporation

Greetings and welcome to the Regency Centers Corporation third quarter 2022 earnings call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. And as a reminder, this conference is being recorded. It is now my pleasure to introduce you to Christy McElroy, SVP of Capital Markets. Thank you, Christy. You may begin.

Good morning, and welcome to Regency Center's third quarter 2022 earnings conference call. Joining me today are Lisa Palmer, President and Chief Executive Officer, Mike Moss, Chief Financial Officer, Jim Thompson, Chief Operating Officer, Chris Levitt, SVP and Treasurer, Alan Roth, Senior Managing Director of the East Region, and Nick Wibenmeyer, Senior Managing Director of the West Region. As a reminder, today's discussion may contain forward-looking statements about the company's views 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. It's possible that actual results may differ materially from those suggested by the forward-looking statements we may make. Factors and risks that could cause actual results to differ materially from these statements may be included in our presentation today and are described in more detail in our filings with the SEC, specifically in our most recent form 10-K and 10-Q filing. In our discussion today, we will also reference certain non-GAAP financial measures. The comparable GAAP financial measures are included in this quarter's earnings materials, which are posted on our investor relations website. Please note that we have also posted a presentation on our website with additional information, including disclosures related to forward earnings guidance. Our caution on forward-looking statements also applies to these presentation materials. Lisa?

Thank you, Christy. Good morning, everyone. Thank you for joining us today. We are pleased to report another quarter of solid results. We've continued to see positive operating trends as tenant demand is strong and rent growth remains at healthy levels, despite the challenging macroeconomic backdrop. We do recognize that neither we nor our tenants are immune to macro pressures, especially higher levels of inflation, rising interest rates, and lower consumer spending, and this does create some uncertainty in the near term. But if the last few years have proven anything, it's the resiliency of our people, assets, and our balance sheet in tough times. It is through a lens of what I would characterize as cautious optimism that we look ahead, and we remain confident that we are uniquely positioned to outperform. The demographic profile of our portfolio provides greater cushion for inflationary impacts to be absorbed by consumers and for spending to continue through a softer economic environment. Our dense suburban trade areas also continue to benefit from structural tailwinds stemming from post-pandemic migration patterns and hybrid work, but also by a renewed appreciation for the value of brick-and-mortar retailing. Additionally, and just as importantly, we are well-positioned to continue to execute on our self-funded growth strategy. While the costs of raising incremental capital have risen meaningfully over the last several months, our strong free cash flow and balance sheet dry powder enable us to continue to invest in our value creation pipeline on an earnings accretive basis without the need to raise new equity capital or sell assets into an illiquid transaction market. We remain focused on further growing our development and redevelopment pipelines, and the commencement of our town and country project last month is an example of that. Another example is our acquisition of East Meadow Plaza on Long Island, as we bought this as a redevelopment opportunity. And with the backdrop of a more challenging financing environment, we are starting to see more opportunities come to us to co-invest in attractive development projects. On the acquisition side, while we always are looking for compelling opportunities, bid-ask spreads remain wide and volumes are low, so it will likely take time to get real price discovery. But regardless of when or where things settle, we do believe there will be less of an impact to values for well-located, grocery-anchored, neighborhood and community centers at the upper end of the quality spectrum. In other words, for the types of assets that we own. But in the meantime, we are fortunate to have the liquidity and balance sheet capacity to take advantage of dislocation or other opportunities that may arise. Finally, as I step back and think about the potential for operating in a more challenging environment, or in any environment for that matter, I feel grateful to be leading Regency with the quality of assets and the caliber of people that we have. I believe we are well positioned to outperform over the long term, acting as both a safe haven and generating solid and sustainable growth, driving total shareholder returns with earnings growth plus dividends. I always like to remind you that I'm proud that we delivered our dividend consistently during the pandemic, even growing it, with another 4% increase just announced for the fourth quarter. Jim?