Alexander & Baldwin, Inc.

Good day and welcome to the fourth quarter and full year 2021 Alexander and Baldwin Earnings Conference Call. All participants will be in a 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 your 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 conference over to Steve Sweat, Investor Relations. Please go ahead.

Thank you. Aloha and welcome to our call to discuss Alexander and Baldwin's fourth quarter and full year 2021 earnings. With me today for our earnings call are A&B's President and Chief Executive Officer Chris Benjamin, our Chief Operating Officer Lance Parker, and our Chief Financial Officer Brett Brown. Clayton Chun, Chief Accounting Officer, is also present and will be available for the Q&A portion of the call. Before we commence, please note that statements in this call and presentation that are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve a number of risks and uncertainties that could cause actual results to differ materially from those contemplated by the relevant forward-looking statements. These forward-looking statements include but are not limited to statements regarding possible or assumed future results of operations, business strategies, growth opportunities, and competitive positions, as well as the rapidly changing challenges with and the company's plans and responses to the novel coronavirus COVID-19 pandemic and related economic disruptions. Such forward-looking statements speak only as of the date the statements were made and are not guarantees of future performance. Forward-looking statements are subject to a number of risks, uncertainties, assumptions, and other factors that could cause actual results and the timing of certain events, to differ materially from those expressed in or implied by the forward-looking statements. These factors include but are not limited to prevailing market conditions and other factors related to the company's REIT status and company's business, risks associated with the COVID-19 pandemic and its impacts on the company's businesses, results of operations, liquidity and financial condition, and evaluation of alternatives by the company related to its materials and construction business, as well as other factors discussed in the company's most recent Form 10-K, Form 10-Q, and other filings with the SEC. The information in this call and presentation should be evaluated in light of these important risk factors. We do not undertake any obligation to update the company's forward-looking statements. Management will be referring to non-GAAP financial measures during our call today. Included in the appendix of today's presentation slides is a statement regarding our use of these non-GAAP measures and reconciliations. Slides from this presentation are available for download at the investor section of our website at www.alexanderbaldwin.com. Chris will open up today's presentation with a strategic update. He will then turn the presentation over to Lance for an update on real estate operations, and then Brett will discuss financial matters. Chris will return for some closing remarks, and then we will open up the call for your questions. With that, let me turn the call over to Chris.

Thanks, Steve, and good afternoon to our listeners. 2021 was a very strong year for our company, and it's positioned us to increase our focus on commercial real estate growth in 2022. as we strive to complete our simplification. In commercial real estate, we began the year cautious but optimistic, still facing uncertainty regarding the path of COVID, but with strong occupancy and a relatively healthy tenant base considering what our tenants had weathered in 2020. As the year progressed, Hawaii's recovery accelerated, and our high-quality portfolio of well-located retail, industrial, and ground lease properties demonstrated its strength. Our collaborative engagement with our tenants through COVID bore fruit as our occupancy remained strong throughout and positioned us to capture upside from the economy's reopening during 2021. Some highlights of our full-year performance include CRE revenue increasing more than 15%, total CRE portfolio NOI and same-store NOI both up more than 17%, and core FFO up by more than 26%. This growth was driven primarily by our retail segment, which achieved a nearly 24% improvement in same-store NOI. Our retail properties had been most severely impacted by 2020 COVID-related effects, and therefore had a significant rebound. We also reported solid growth in our industrial and ground lease segments, which generated same-store NOI growth of more than 8%. The surge in employment levels and retail spending in Hawaii throughout 2021 provided a strong boost to our portfolio. These effects were largely the result of the state's reopening for tourism, with passenger arrivals for the peak summer and winter holiday travel seasons at approximately 89% and 80%, respectively, of 2019 levels. even with the lingering uncertainty caused by the Delta and Omicron variants. As we've said before, our portfolio is generally community-based and less dependent on tourist activity, but the resurgence in Hawaii tourism is providing a broad benefit to economic activity as evidenced by the drop in the unemployment rate from 10.3% at the start of 2021 to 5.7% at the end of the year. It's important to note that the state's tourism levels in 2021 continue to reflect essentially no international travelers, which had comprised about 28% of visitors in 2019. As COVID case counts trend in the right direction, we expect to see a continued reduction in travel restrictions. Our results, of course, are not due only to these broad economic trends. We own great assets in great locations. We ended 2021 at 94.3% lease occupancy, and our portfolio occupancy has remained consistent with year-end 2019 levels. Occupancy was aided by the record leasing volumes in 2021 with over 270 leases signed during the year for more than 650,000 square feet and with comparable leasing spreads of 4.6%. We advanced a number of redevelopments during the year, totaling about $17 million of capital, with strong projected returns between high single digits and low double digits. We expect to invest another $15 to $20 million in redevelopment projects in 2022 with similar projected returns. All of this capital is going to refresh, reposition, and re-tenant our well-located properties, demonstrating the embedded growth opportunities within our portfolio. Looking beyond our existing portfolio, we've pivoted our investment team back to acquisition efforts. In the fourth quarter, we closed on our first acquisition since mid-2019. It's a well-located industrial property in Honolulu, along with two industrial lots for development in West O'ahu. Our team is actively working to source additional opportunities, and we're diligently building our pipeline. Turning to our simplification efforts, 2021 was a big year, as the strong demand for Hawaii real estate and the large amount of capital in the market enabled us to monetize more than $200 million of non-core land. Activity for the year included the fourth quarter sale of our Kukuyula joint venture, several lots at Maui Business Park, and other agricultural and urban parcels on Maui. With the proceeds, we further strengthened our balance sheet. At year end, leverage was 3.3 times net debt to adjusted EBITDA, and we now have nearly $519 million of total liquidity, allowing us to go on offense as opportunities arise. This progress in monetization of non-core assets and delevering our balance sheet is encouraging and gets us significantly closer to our goal of being a pure commercial real estate company. But we fully acknowledge the remaining important step of exiting the materials and construction segment. MNC had a challenging year financially in 2021 and took an impairment in the fourth quarter that Brett will describe, but is far better positioned for profitability in 2022. I want to commend the Grace team for the outstanding work they've done to reposition the business. In many ways, they've had to reinvent the company to respond to a fundamental and permanent shift in the industry. With more players buying for less business in the paving market than when we bought the business, they've had to reduce overhead significantly, increase operating efficiency, establish new bidding processes and discipline, and expand their focus on the materials segment of the business. Because of their efforts and the strongest book of business Grace has had in four years, we expect to launch another marketing effort this spring against the favorable backdrop of an infrastructure bill that promises to inject up to $1.5 billion into Hawaii for road and bridge projects. Now, I will turn the call over to Lance to review our recent CRE highlights and land sales activity. Lance?