Alexander & Baldwin, Inc.

Good day and welcome to the fourth quarter and full year 2023 Alexander and Baldwin Earnings Conference Call. All participants will be in 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 questions, you may press the star 1 on the touch-tone phone. To withdraw your questions, please press the star 2. I would now like to turn the conference over to Steve to ask investor relations. Please go ahead, sir.

Thank you. Aloha and welcome to Alexander and Baldwin's fourth quarter and full year 2023 earnings conference call. With me today are A&B's Chief Executive Officer Lance Parker and our Chief Financial Officer Clayton Shunt. We are also joined by Kit Mellon, Senior Vice President of Asset Management, who is available to participate in the Q&A portion of the call. During our call, please refer to our fourth quarter 2023 supplemental information available on our website at investors.alexanderbalvin.com forward slash supplements. Before we commence, please note that statements in this presentation that are not historical facts are forward-looking statements. Within the meaning of the private securities litigation reform act of 1995, it involved a number of risks and uncertainties that could cause actual results to differ materially from those contemplated by the relevant forward-looking statement. 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. 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 statement. These factors include, but are not limited to, prevailing market conditions and other factors related to the company's REIT status and the company's business, the evaluation of alternatives by the company related to its non-core assets and business, and the risk factors discussed in the company's most recent Form 10-K, Form 10-Q, and other filings with the SEC. The information in this presentation should be evaluated in light of these important risk factors. We do not undertake any obligation to update the forward-looking statements. Management will be referring to non-GAAP financial measures during our call today. Please refer to our statement regarding the use of these non-GAAP measures and reconciliations included in our 2023 fourth quarter supplemental information and earnings press release. Lance will open up today's presentation with an overview of the quarter and year, provide an update on our real estate operations, and then Clayton will discuss financial matters. Lance will return for some closing remarks, whereupon we will open it up for your questions. Now I'll turn the call over to Lance.

Thanks, Steve, and aloha, everyone. I'm pleased to say that 2023 ended on a high note. Our high-quality CRE portfolio of retail, industrial, and ground lease assets performed well. In the fourth quarter, total NOI growth was 4.7%, and we achieved same-store NOI growth of 4.3%. Same-store NOI growth, excluding collections of previously reserved amounts, was 4.8%. for FFO was $21 million or 29 cents per share. Same store leased occupancy at year end was 95.5%, 100 basis points higher than the third quarter. Same store economic occupancy at year end was also up 100 basis points from the last quarter to 93.8%. We also executed 50 leases in our improved property portfolio for approximately 114,000 square feet and achieved blended spreads of 7.8% with spreads for new leases at 11.4% and spreads for renewal leases at 7%. For the year, total CRE NOI growth was 4.7%. On our last call, we revised our annual guidance up and we ended the year exceeding those metrics with same-store NOI growth of 4.3% same-store NOI growth excluding collections of previously reserved amounts of 6.8%, and core FFO for the year was $85.3 million, or $1.17 per share. We executed 233 leases in our improved property portfolio and had six ground lease renewals. Leases in our improved property portfolio covered approximately 624,000 square feet, with blended spreads of 7.7%, spreads for new leases at 8%, and spreads for renewal leases at 7.6%. Renewals in our ground lease portfolio resulted in blended leasing spreads of 37.8%, driven primarily by the renewal at Windward City Shopping Center earlier in the year. The spread between leased and economic occupancy was 170 basis points, and annualized base rent attributable to these S&O leases was $2.8 million of ABR or 2% of portfolio NOI. During the fourth quarter, we also completed a number of strategic objectives that position us well for the long term. We began permitting for a 30,000 square foot, 32 clear height warehouse and distribution center at Maui Business Park. The space is pre-leased to a national tenant and construction is anticipated to begin in the second half of 2024. We expect to realize $1 million of ABR when the asset becomes economic. We also went live with our 460 kilowatt rooftop photovoltaic system at Kaka'ako Commerce Center. This is the second rooftop PV system in our portfolio and follows the successful installation of our first system at Pearl Highland Center last year, which provided about $675,000 of incremental NOI in 2023. We are in various stages of rollout at other centers in our portfolio and look forward to sharing more as additional systems are brought online. Most notably, we completed the sale of Grace Pacific through two transactions for a combined $60 million. The sale of Grace is significant for three reasons. First, we can focus on growing our commercial real estate portfolio. Second, we can fully utilize the strength of our balance sheet to fund these growth initiatives. And finally, we can simplify our reporting metrics. These accomplishments in the fourth quarter add to our achievements from earlier in the year, including our off-market acquisition of Kaomi Loop Industrial, a 33,000 square foot property, in the second quarter and the completion of our Manoa Marketplace Refresh in the third quarter. Our portfolio of primarily grocery-anchored neighborhood centers continues to benefit from the economic environment here in Hawaii. Unemployment was 2.9% at the end of 2023, improving 80 basis points from a year earlier and lower than the national average of 3.7%. There were 9.6 million statewide visitors in 2023, up from 9.2 million in 2022, and 93% of pre-pandemic levels. Visitors from the mainland U.S. exceeded pre-pandemic levels but were down slightly compared to 2022. There were 573,000 visitors from Japan in 2023, nearly three times higher than 2022 but still only about a third of pre-pandemic levels. We have often said that our grocery anchored portfolio benefits from but is not dependent on tourism. This has proven true with the Maui wildfires where visitor arrivals were down in four of the five, four of the last five months in 2023 compared to 2022, but our tenant sales have remained stable. And now I'll turn the call over to Clayton for financial details. Clayton.