American Assets Trust, Inc.

Welcome to American Asset Trust Inc's third quarter 2024 earnings call. As a reminder, today's conference is being recorded. Please note that statements made on this conference call include forward-looking statements based on current expectations, which statements are subject to risks and uncertainties discussed in the company's filings with the SEC. Your caution not to place undue reliance on these forward-looking statements as actual events could cause the company's results to differ materially from these forward-looking statements. Yesterday afternoon, American Assets Trust earnings release and supplemental information were furnished to the SEC on Form 8K. Both are now available on the investor section of the website, AmericanAssetsTrust.com. It is now my pleasure to turn the conference over to Ernest Rady, Chairman and CEO of American Assets Trust. Please go ahead, sir.

Good morning, everyone. Thank you again for joining us today. At American Assets Trust, we've always emphasized our strength lies in our diversified high quality portfolio, top tier operating platform, disciplined financial strategy, and our highly experienced and capable management team. These factors position us well to navigate any economic environment. Along those lines, Throughout the year, we've been closely monitoring the debt markets. In September, we made the strategic decision to approach the investment-grade bond market for our latest issuance. The strong demand led us to upsize the offering after it was initially more than four times oversubscribed. In the end, we issued a 10-year, $525 million bond at a 6.15% coupon We were fortunate to lock in favorable rates, taking advantage of a market rally, and they lead up to our issuance. This bond strengthens our liquidity and flexibility, addressing all of our debt maturity into early 2027. I'm sure you're all familiar with the saying, better lucky than smart. Fortunately, we have checked both boxes. Its rates quickly surged. following our offering with a 10-year yield climbing over 55 basis points since our issuance. We were able to capture a favorable window in the market. Shortly, my colleagues Adam, Bob, and Steve will walk you through the performance of our various asset segments, as well as Abigail, too, by the way, our financial results and updated guidance. But before we get to that, I'm pleased to announce that our board of directors had declared a quarterly dividend of $0.0335 per share for the fourth quarter. This dividend reflects not only our solid financial performance, but also the board's continued confidence in the company's future prospects. The dividend will be paid on December 16th to shareholders of record as of December 5th. I'd like to take a moment to sincerely thank you all for your continued trust and support. We remain committed to delivering value as we guide the company forward. Now the call over to Adam to review our quarterly results. Adam, please.

Thanks, Ernest, and I echo your sentiments regarding the success of our recent bond offering. This achievement would not have been possible without the hard work and dedication of our teams across the organization. Their commitment is critical to our overall success, and we're incredibly fortunate to have such a talented group of employees. I'd also like to highlight the value of our face-to-face meetings with fixed income investors, where we had the opportunity to update them on our credit profile and overall strategies. The broad distribution of this offering to high-quality institutional accounts not only positions us well for future issuances, but also enhances the liquidity of our outstanding bonds as we remain focused on maintaining financial flexibility while driving value through active portfolio management. Our portfolio continues to perform well across each of our asset classes, underpinned by our presence in high barrier-to-entry markets. You'll note from our supplemental that nearly 50% of our cash NOI was generated from Southern California, with San Diego being a very important market for us. As we've emphasized before, San Diego's well-diversified economy is growing stronger, driven by the relatively recent influx of the world's major tech and pharmaceutical companies, its military and defense presence, prestigious universities, leading service providers, and the third largest life science cluster in the country. On the operations front, we continue to see gradual but steady improvement in office usage across our portfolio. Recent mandates from companies like Amazon, Dell, Boeing, Goldman Sachs, and UPS, as well as some of our larger tenants, are moving toward a five-day-a-week in-office requirement. The rationale behind these mandates is clear. Collaboration, innovation, culture, and learning. And we believe the quality of our office buildings, prime locations, and top-tier amenities set us apart contributing to higher utilization and stronger leasing activity compared to our competitors. But the reality is these return-to-office policies will only move the needle if the organizations actually enforce them. We're hopeful on that. Steve will provide an update shortly on the leasing momentum across our markets and our office portfolio, where despite the broader market challenges, demand for high-quality, well-located office spaces remains encouraging. Our retail segment continues to perform quite well. We've renewed virtually all of our lease expirations this year and have less than 7% expiring in 2025, the majority of which are larger format retailers that we are confident in renewal. Meanwhile, retail leasing spreads have been trending positively for the past several years, with a 4.4% increase on a cash basis and 18.7% increase on a straight line basis for Q3 transactions, which was a relatively active quarter for our retail leasing. In fact, our retail portfolio achieved its highest average base rent per square foot in Q3 since our IPO, placing us with the second highest average among our best-in-class peers that we track. Foot traffic and tenant sales have trended positively as we continue to work with our tenants to ensure long-term success as they adapt to evolving consumer behaviors. On the consumer spending side and in regards to the tenants we receive sales reports from, We saw a 5% increase in gross sales at our properties in 2023 compared to 2022, and through mid-2024, tenant sales are up another 5%, further reinforcing the strength and quality of our retail portfolio. While we're aware of potential headwinds in the broader economy, we believe that consumer spending in the densely populated affluent areas surrounding our centers will remain resilient. Turning to our multifamily portfolio, ongoing demand for well-located, quality housing continues to drive stable performance across our multifamily properties, especially in markets where supply remains constrained. We ended Q3 in San Diego with a 93% occupancy rate and a 94% lease rate. In San Diego, leases for vacant units were signed at approximately 3% lower than prior rents, while renewed leases saw an average increase of 6%, resulting in a blended average increase of 3%, with minimal concessions offered. In Q3, our Hasolo and eighth multifamily community in Portland saw leases for vacant units signed at an average 2% increase with renewed units up by 3%. This resulted in a blended increase of 3% while our leasing percentage remained strong at 95% with minimal concessions. Net effective rent at Hasolo grew up 4% in Q3 compared to the same period in 2023. Overall, our multifamily portfolio achieved its highest ever average base rent in Q3. Additionally, we saw our same store multifamily NOI increase by over 4% year over year for Q3. And year to date, NOI is up 6% compared to 2023, with strong collections across the portfolio in Q3. Looking ahead, we remain focused on five key drivers of future growth. First, capitalizing on embedded rent escalations and bringing below market leases to market. Second, leasing up and stabilizing our new office developments and redevelopments, which you'll hear updates on from Steve in just a moment. Third, benefiting from the anticipated return of Asian tourism to Oahu. Fourth, densifying our existing assets with a focus on unlocking multifamily development opportunities. And fifth, pursuing accretive acquisitions when market conditions align with our strategic goals. With that, I'll turn the call over to Bob to discuss financial results and updated guidance in more detail.