Armada Hoffler Properties, Inc.

Good morning, ladies and gentlemen, and welcome to the Armada Hoffler 4th Quarter 2023 Earnings Conference Call. At this time, all lines are in listen-only mode. Following the presentation, we'll conduct a question and answer session. If at any time during this call you require immediate assistance, please press the seal for the operator. This call is being recorded on Thursday, February 22nd, 2024. I would now like to turn the conference over to Chelsea Forrest, Director of Corporate Communications and Investor Relations. Please go ahead.

Good morning and thank you for joining Armada Hoffler's fourth quarter and full year 2023 earnings conference calling webcast. On the call this morning, in addition to myself, is Lou Haddad, CEO, Matthew Barnes-Smith, CFO, and Sean Tibbetts, President and COO. The press release announcing our fourth quarter earnings along with our earnings guidance and supplemental package were distributed this morning. A replay of this call will be available shortly after the conclusion of the call through May 23, 2024. The numbers to access the replay are provided in the earnings press release. For those who listened to the rebroadcast of this presentation, we remind you that the remarks made herein are as of today, February 22nd, 2024, and will not be updated subsequent to this initial earnings call. During this call, we may make forward-looking statements, including statements related to the future performance of our portfolio, our development pipeline, the impact of acquisitions and dispositions, our mezzanine program, our construction business, our liquidity position, our portfolio performance, and financing activities, as well as comments on our guidance and outlook. Listeners are cautioned that any forward-looking statements are based upon management's beliefs, assumptions, and expectations, taking into account information that is currently available. These beliefs, assumptions, and expectations may change as a result of possible events or factors, not all of which are known and many which are difficult to predict and generally beyond our control. These risks and uncertainties can cause actual results to differ materially from our current expectations, and we advise listeners to review the forward-looking statement disclosure in our press release that we distributed this morning and the risk factors disclosed in the documents that we have filed with or furnished to the SEC. We will also discuss certain non-GAAP financial measures, including but not limited to FFO and normalized FFO. Definitions of these non-GAAP measures, as well as reconciliations to the most comparable GAAP measures, are included in the quarterly supplemental package, which is available on our website at armadahoffler.com. I'll now turn the call over to Lou.

Thanks, Chelsea. Good morning, everyone, and thank you for joining us today. In addition to analysts and investors, there are many of the Armada Hoffler family and joint venture partners on the call. On behalf of our founder and chairman, Dan Hoffler, the Board of Directors, and Executive Management, we sincerely thank you for being a part of our team. Later in the call, Sean and Matt will comment on our year-end results as well as our 2024 guidance. I will highlight two important actions that were taken by our Board of Directors last week. First, as you probably have already seen, we've raised the dividend a solid 5% to 20.5 cents per quarter. This increase brings the dividend into alignment with our longstanding coverage parameters of approximately 80% of AFFO. More importantly, it is indicative of management's confidence in the trajectory of our business model, increased property NOI, strong leasing activity, and development income expected to come online in the fourth quarter. All factor into our confidence in our core business and sustainability of our current cash flows. The second board resolution was the promotion of Sean Tibbetts to the position of president. Upon my retirement in spring of 2025, we anticipate Sean will become CEO. Over the last five years, Sean has shown remarkable business acumen, team building skills, and leadership talent. As a CEO who is nearing the end of his time in the top job, one of the most important duties is to find and mentor a likely successor. And if he does his job really well, he finds someone who has the potential to eclipse the accomplishments of his predecessor. We have found that person in Sean. This promotion is the first step in the succession plan approved by the board last year. The next phase will be our founder and chairman, Dan Hopler's transition to chairman emeritus. He expects to remain on the board as of our annual meeting in June. At that time, assuming shareholder approval, I will become both chairman and CEO for an interim period expected to be approximately one year, after which we expect to promote Sean to CEO. Dan and I are excited to start this transition to a new generation of management while continuing to guide the company to further growth and prosperity.