Broadstone Net Lease, Inc.

And welcome to Broadstone Net Lease's second quarter 2021 earnings conference call. My name is Andrew and I will be your operator today. Please note that today's call is being recorded. If you require operator assistance, please press star then zero. I will now turn the call over to Mike Caruso, Senior Vice President of Corporate Finance and Investor Relations at Broadstone. Please go ahead.

Thank you, Operator, and thank you, everyone, for joining us today for Broadstone's second quarter 2021 earnings call. On today's call, you will hear from our Chief Executive Officer, Chris Czarnecki, our Chief Financial Officer, Ryan Albano, and John Marana, Chief Operating Officer, who will participate in Q&A. Before we begin, I'd like to remind everyone that the following presentation contains forward-looking statements, which are subject to risks and uncertainties that can cause actual results to differ materially due to a variety of factors. We caution you not to place undue reliance on these forward-looking statements and refer you to our SEC filings, including our Form 10-K for the year ended December 31st, 2020, for more detailed discussion of the risk factors that may cause such differences. Any forward-looking statements provided during this conference call are only made as of the date of this call. I will now turn the call over to our Chief Executive Officer, Chris Czarnecki.

Thank you, Mike, and welcome to everyone joining our Q2 conference. 2021 earnings call. I hope that our listeners are having a safe, healthy, and enjoyable summer. It's hard to believe we are quickly approaching the one-year anniversary of our initial public offering. I could not be prouder of all that the B&L team has accomplished since entering the public markets and where we are currently positioned as we move toward the second half of the year. During Q2, we continued to execute on our growth objectives while simultaneously strengthening our balance sheet to position B&L for a strong second half of the year. Our defensive growth profile remains exceptionally attractive. The predictability and consistency of our portfolio's operating profile, as evidenced by the collection of 100% of base rents due during the quarter, affords us the ability to focus intently on external growth. I'm pleased to see our stock continue to season in the public market, which further enhances liquidity and access to capital and allows us to continue to grow earnings through accretive acquisitions. During the quarter, we successfully executed on our first follow-on offering, which has positioned the balance sheet to continue to support growth in the second half of the year. Ryan will provide additional detail on capital raise activity in a few moments, but I would first like to provide an update on Q2 investment activity. During the quarter, we closed seven transactions comprising 34 properties for a total investment of $194 million at a weighted average cash cap rate of 6.2%. The leases include 1.4% weighted average rent escalations and a 13.2 year weighted average lease term. Acquisitions completed during the quarter were more heavily weighted towards industrial at 57% with a smaller concentration of healthcare and retail properties at 24% and 19% respectively. When compared to a more retail dominated first quarter of the year, the change in property type mix for acquisitions completed during Q2 demonstrates the strategic benefits of our diversified strategy. Our approach to net lease investing allows us to pivot quarter over quarter depending on the opportunity set available without dramatically altering portfolio concentration levels. This affords us the opportunity to be patient and selective, ensuring we are acquiring the best investments on a risk-adjusted basis within each of our core property segments. In July, we also acquired an additional seven assets for $34.2 million in the industrial and retail spaces via four transactions. I would now like to give a brief overview of several of the key transactions completed during the second quarter. First, we acquired 11 mission-critical industrial properties in a sale and leaseback transaction for a total of $106.6 million at an initial cash cap rate of 6%. The properties are leased to Ryerson, a leading metal processing and distribution company. The properties are in geographically diverse markets that are strategic to the tenant's operations across 10 different states. The leases include a 15-year initial term, and a 1.5% annual rent escalator, translating into an average annual yield on investment of 6.7% over the term. This transaction demonstrates our ability to continue to source accretive industrial acquisitions that complement our existing portfolio, despite heightened levels of competition in the industrial space. While a slightly larger transaction, Ryerson represents only 2% of our ABR as of quarter end, and our tenant diversification as measured by our top 20 tenants remains amongst the best in the net lease space. We also added 11 healthcare properties through two transactions for a total investment of $46 million at a weighted average initial cash cap rate of 6.3% during this quarter. The properties included a diversified portfolio of seven veterinary clinics, as well as four properties leased to a strong regional healthcare provider offering ambulatory, surgery, diagnostic imaging, urgent care, and rehabilitation services. The properties are subject to a weighted average annual rent escalations of 1.7% and have a weighted average lease term of approximately 10 and a half years. Both healthcare transactions completed during the quarter highlight the granular diversification within our portfolio, especially within the healthcare vertical. The veterinary space is one which we've invested in for many years and viewed as an attractive adjacency to our core healthcare investing given its strong business fundamentals, and the growth profile of our national tenants. We continue to view healthcare as a unique differentiator for B&L and remain focused on sourcing additional opportunities in this core property segment. Finally, we added $9 for locations that were sourced by our small transaction investment grade retail process for a total investment of $13.4 million at a weighted average initial cap rate of 6.6%. The properties are located in the southeast and have a weighted average lease term of eight and a half years and a weighted average annual rent escalation of 0.4%. Given our size, knowledge of these tenants and streamlined acquisitions process, we have the unique ability to quickly and efficiently transact on a one-off investment grade retail acquisitions that help bolster our routine sourcing efforts. Our growing small transaction investment grade pipeline ensures consistency and deal flow throughout the year that supplements our larger sourcing efforts. Acquisitions during the second quarter and in July bring total volume for the first seven months of the year to $315.5 million. We currently have an additional $211 million of assets under our control, which we define as under contract or executed letter of intent. These opportunities are well diversified across industrial, healthcare, and retail assets and bring our year-to-date volume closed and currently under control to $526 million. The substantial majority of under control acquisitions are expected to close in the second half of the year, but also includes a forward commitment currently scheduled to fund in 2022. With solid momentum and increased visibility into the pipeline for the second half of the year, we are raising our full year 2021 acquisition guidance by $100 million to a range of $550 million to $650 million. Ryan will provide additional detail regarding further guidance revisions in a few moments. As of June 30th, we owned 684 net lease properties located across 42 US states and one property in Canada and portfolio occupancy remained steady quarter over quarter at 99.7%. Only six of our 684 total properties were vacant at quarter end. The portfolio had a weighted average remaining lease term of 10.4 years with 2% weighted average annual rent increases. Our forward lease maturities continue to be negligible and represent just 0.1% of ABR in 2021 and a total of 2.4% of ABR through 2023. I'll now turn the call over to Ryan to provide additional detail on our Q2 results, the execution of our most recent follow-on offering, and our full year 2021 outlook. Ryan.