Alexandria Real Estate Equities, Inc.

Good day and welcome to the Alexandria Real Estate Equities second quarter 2021 conference call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing star then zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on a touch-tone 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 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 the federal securities laws. The company's actual results may 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 our second quarter call. With me here today are Jenna Foger, Peter Moglia, Steve Richardson, and Dean Shigenaga. I want to welcome all to this second quarter call and also, as I always try to do, to recognize and thank the entire Alexandria family team for one of the best quarters in the entire history of the company with an operational tempo really like none other while working virtually for many of us for most of the past now into our second year of COVID. As Michael Jordan once said, some people want it to happen, some people wish it to happen, others make it happen. Alexandria makes it happen. We're deeply mission-driven and thankful for all that we do and urge you to read about many of our important programs and activities in the corporate social responsibility area in our press release and sub. For a moment, keys to the second quarter, historic high demand for Alexandria's lab space and our critical lab operations, which go along with that. Alexandria is at the vanguard of meeting the historic and high unprecedented demand from many of our more than 750 tenants for growth needs now and a critical path for future growth, very importantly. Fundamental drivers of demand are the strongest we've ever seen. Rental rate growth continues unabated and no excess supply on the horizon at this time. We're very proud that we've got almost 7% quarter-to-quarter per share FFO growth, more than 40% rental rate growth, almost 18% NOI growth, almost 8% same-store NOI growth, and a $1.3-plus billion annual NOI run rate, not to mention about $545 million in incremental revenue in our development and redevelopment pipeline. Alexandria truly has a demonstrable pricing power advantage in each of our cluster markets. And when life science tenants choose, they almost always prefer Alexandria's lab space and our operational excellence based on our critical lab operations. Nature Biotechnology Magazine back in April wrote the following. 2020 was a year that smashed many records. Biotech's savior role in the pandemic attracted a stampede of private and public investors alike. The pandemic apparently reinforced the requirement for long-term value-based investors of any kind to have exposure to life sciences. And life science demand has, in fact, hit an all-time high as the world has recognized the importance of next-generation therapies to solve current and future really difficult healthcare challenges. and Jen will talk a bit more about it. I'm going to highlight just a couple of things for the moment. The pandemic has underscored the support for the National Institutes of Health and investment in basic science, which are keys to ensuring that the U.S. maintain its leadership position in life science and maximizing national preparedness to address current and future healthcare challenges. There is a proposal right now to increase the fiscal year 22 NIH budget up to $51 billion, nearly a 20% boost over fiscal year 21. The FDA Center for Drug Evaluation and Research, better known as CDER, has approved 23 new molecular entities in the first half of 2021, putting it on the pace to exceed 2020's near-record approval high of 53. Following a historic year of 2020, venture capital and life science continues at a very strong pace of almost $36 billion, already raised in the first half of 2021, on pace to eclipse 2020's all-time high of $46 billion. This unprecedented level is likely to continue throughout the year due to substantial dry powder available to life science funds and increased investment from institutional generalists and traditional life science investors. Following a record 2020 for IPOs and follow-on offerings, the first half of this year have continued to reach new highs with over $8 billion raised in 52 IPOs and over $17 billion raised in many follow-ons, positioning 2021 for an all-time record year of public market investment in life science. R&D continues with amazing productivity and resilience through COVID and enabling the industry to expediently deliver novel vaccines and therapies to combat the global pandemic. New biology, drug discovery platforms, and increasing focus on complex medicines as the future therapeutic innovation have all demonstrated the life science industry's ability to effectively drive solutions to current and future healthcare challenges and yield strong returns to investors. And maybe a final comment would be, as Project Warp Speed did in bringing a historic public-private partnership together of the government on the one hand and the private industry, biotech and pharma companies on the other hand, at a warp speed rate to bring research and development and commercialization of the COVID vaccines in record time, as well as ensure a timely manufacturing supply We really do need a 21st infrastructure package, not a 20th century package like the one Congress is now debating. We need to make the U.S. self-sufficient in semiconductors. We only produce now about 11 to 13% and self-sufficient in next-gen manufacturing of complex medicines. And so with that, let me turn it over to Jenna.