Alexandria Real Estate Equities, Inc.

good day and welcome to the Alexandria real estate equities fourth quarter year-end 2018 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 a question you may press star then one on your telephone keypad 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 Paula Schwartz, Investor Relations. Please go ahead.

Thank you, and good afternoon. This conference call contains forward-looking statements within the meaning of the federal securities laws. The company's actual results might differ materially from those projected in the forward-looking statements. Additional information concerning factors that could cause actual results to differ materially from those in the forward-looking statements is contained in the company's periodic reports filed with the Securities and Exchange Commission. And now I'd like to turn the call over to Joel Marcus, Executive Chairman and Founder. Please go ahead, Joel.

Thank you, Paula, and welcome everybody to the fourth quarter and year-end 2018 conference call. And Happy New Year and Healthy New Year to everybody. With me today are... Steve Richardson, Peter Moglia, and Dean Shigenaga. And as I always do, I want to thank the entire Alexandria family for an operationally outstanding fourth quarter and year-ended 2018. A quick look at page four of our press release highlights are, I think, and depicts our amazing collective accomplishments as of year-end, including our all-time high in revenues. Each of the speakers will get into these. the quality of our tenants, the quality of our cash flows, our leasing stats, our margins, our credit rating, our exposure to variable rate debt, and importantly, very importantly, our leverage is the lowest we've ever had in the history of the company. So with that, I'd like to talk a little bit about Since our founding, we've always been blessed to be an idea-based meritocracy culture, and as a very mission-driven company, we operate at the highest standards and levels of integrity and ethical behavior. And we have among the best disclosure and transparency hard-earned over our 22 years as a public company, and so recognized by NAREIT. And when we speak about corporate social responsibility, which is a big buzzword in the industry today, We at Alexandria try to live it every day. In 2018, among many notable accomplishments, our team volunteered over 2,600 collective hours to important nonprofit causes, and 49 of our team members ran the New York City Marathon and raised over almost a quarter of a million dollars for Memorial Sloan Kettering's cancer fund research. At Investor Day on November 28th, in addition to giving what we felt was very good guidance for 2019, we also gave investors and analysts our framework for our five-year growth plan where Alexandria has the potential to double rental revenues from 2018 to 2022 on what we own on balance sheet today, assuming a positive macro and industry environment. And I think it's important to understand why we can articulate such a bold and positive framework. It really is based on three key strategies. Number one is our business strategy. And in the 2004, 5, and 6 timeframe, we pivoted from a single asset strategy to a core cluster campus strategy and began and initiated major campuses in Mission Bay, New York City, and Cambridge and beyond. which are now bearing huge cash flow, high-quality cash flow results. In addition to our business strategy, our financial strategy was pretty crucial coming out of the financial crisis of 2008 and 2009 for the years 2010 through 2013. We became a critically important investment-grade company with access to investment-grade debt, and we sold certain key land parcels, including a very large site which really was handled in an exquisite fashion by Steve Richardson, which now sits on where the Warrior Stadium is being built and where we're building two towers for Uber for part of their headquarters at Mission Bay. And that really was critical to substantially lowering our leverage, which led to our significant outperformance in the years 2014 through 2018. And then thirdly, really, you have a business strategy, you have a financial strategy, and then you have a management and personnel strategy. Those are the three kind of anchors of any really great company strategy. And from 2008 onward, we did not lay off our construction development team during and after the market crash. Led by our very talented Vince Ruzzi, we kept our great team and then continued to build as we came out of the crash to where it is today where we have a super high level of operational excellence with both delivery and cost management. We continue to build our core accounting and financial team with Dean's leadership and the regional operating teams headed by long-tenured Level 5 leaders. And probably one of the most important things we did was appoint Peter Moglia as Chief Investment Officer during the crash, which radically professionalized our entire investment philosophy and approach to operations, acquisition, redevelopment, and development. And Peter also brought a highly specialized experience base and knowledge base in financing joint ventures and sales of partial interest. If you look at page 33 of the supplement, it really depicts The Alexandria management of our development pipeline, something that has become, because of the financial strategy, the business strategy, and the management strategy, really enabled us to grow after and out of the crash. And you can see the stats there on page 33, which I think our dean always is very proud. Really, I think, exceptional for any company. Let me move very quickly before I hand it over to Steve on a quick summary of the life science industry. Venture capital had another historic year at an all-time high with life science being funded to the tune of over $27 billion. San Francisco Bay was number one with 32% of that, greater Boston 21%, and San Diego 9%. The FDA and the industry had a record year with 59 novel medicines approved by the FDA, a historic number. I'm not sure if they can match that in future years, but it was truly historic. Also, 2018 was a strong year for biotech IPOs, with 56 companies going public and raising a cumulative $6.7 billion. So we're very proud of both our real estate fundamentals and also the life science industry fundamentals. So let me turn it over to Steve to get more color on the quarter and the year. Thank you, Joel.