Alexandria Real Estate Equities, Inc.

Good day and welcome to the Alexandria Real Estate Equities second quarter 2019 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 telephone keypad. Please note, this event is being recorded. I would now like to turn the conference over to Paula Schwartz with Investor Relations. Please go ahead.

Thank you, and good afternoon, everyone. This conference call contains forward-looking statements within the meaning of 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 I would like to turn the call over to Joel Marcus, Executive Chairman and Founder. Please go ahead, Joel.

Thank you, Paula, and welcome, everybody, to our second quarter call. With me today are Dean Shigenaga, Steve Richardson, and Peter Moglia. I want to start with focusing on the cover page to our 2Q19 press release and supplemental, which features our recently developed Vertex Pharmaceutical West Coast Research Base, designed in the shape of two human lungs together with a quote from the mother of two children suffering from cystic fibrosis, which I quoted in the first quarter call. This is our solemn mission to build the future of life-changing innovation as we have each and every day over the past 25 years as the originator and innovator of the life science real estate niche, and we thank each and every team member of the Alexandria family for their important contribution each and every day. As we sit here after the close of the second quarter, we really are very proud on a couple of aspects. I think we've reached a point where we can say we really have built a fortress balance sheet with over $3.4 billion in liquidity and a weighted average remaining debt term of greater than 10 years, and Dean will highlight some of the capital accomplishments this past quarter. We also have a pipeline which could enable us to double rental revenue from January of 2018 to December 2022. The strongest client tenant base with 53% of our annual rental revenue from investment grade are publicly traded large cap client tenants with a weighted average lease term of 8.4 years. In addition, a robust 2Q cash theme store growth number that Dean will talk about as well. and Steve will highlight our robust cash-releasing spreads this past quarter. And we're very proud of a very strong value-add pipeline leading into 2020 with significant positive activity in each one of our markets, including the 88 Bluxom win, which is a really big win and a very unique one Steve will talk about. Notably, we increased our quarterly dividend 3.1% during the second quarter as well. In July, we were proud to be notified that we were selected by NAOP as the 2019 NAOP Developer of the Year for our outstanding design work, sustainable outcomes, scientific prowess, and connected campuses driven by our unique and differentiated mission and deep thoughtfulness toward enhancing the communities in which we work. And if we focus for a moment on the next life science frontier, it's pretty clear that the sheer scale of unmet medical needs for patients suffering from diseases of the brain is quite staggering, the cost to society enormous. Just the nine most common neurological diseases are estimated to cost the United States $800 billion a year. Dementia today affects 50 million people worldwide and 10 million new cases diagnosed every year. Alzheimer's alone affects almost 6 million Americans, and more than 1 million Americans live with Parkinson's at a total cost of about $50-plus billion a year, nearly double previous estimates. It's estimated by 2050 that more than 12 million Americans will suffer from some form of neurodegenerative disease. In the realm of psychiatric diseases, nearly one in five adults, almost 50 million people, experience some form of mental illness in a given year, costing our economy almost $200 billion in lost earnings alone, while approximately one in 25 people, 11 million daily, suffer from a form of mental illness, depression, now the leading cause of disability worldwide, and has become the major contributor to global burden of disease. On the addiction front, and we touched upon our efforts in the opioid abuse area last quarter, the abuse of illicit drugs as well as alcohol and tobacco in the U.S. is costing us almost three quarters of a billion, I'm sorry, three quarters of a trillion dollars annually and costs related to crime, lost work, productivity, and health care. The ongoing opioid epidemic is now estimated to cost the U.S. over $500 billion annually, largely driven by the immense scale of preventable fatalities caused by opioid overdoses, where on average 130 Americans die each and every day. Imagine if that was in a war, how that would be covered by the press. Discovering new treatments and cures for disease of the brain has become a goal of ever-increasing urgency and one on which Alexandria is super laser-focused on with our financial capital as well as our human capital. And with that, let me turn it over to Steve to give some highlights of the quarter.