City Office REIT, Inc.

session will follow the formal presentation. At this time, if you'd like to ask a question, please press star followed by one on your touchtone phone. If you're using a speak phone, please pick up the handset before pressing the keys. To withdraw your question at any time, please press star followed by two. As a reminder, this conference call is being recorded and if you require operator assistance at any point, please press star followed by zero. It is My pleasure to introduce to you Tony Maretic, the company's Chief Financial Officer, Treasurer and Corporate Secretary. Thank you Mr. Maretic, you may begin.

Good morning. Before we begin, I would like to direct you to our website at cioreit.com where you can view our third quarter earnings press release and supplemental information package. The earnings release and supplemental package both include a reconciliation of non-GAAP measures that will be discussed today to their most directly comparable GAAP financial measures. Certain statements made today that discuss the company's beliefs or expectations or that are not based on historical fact may constitute forelooking statements within the meaning of the federal securities laws. Although the company believes that these expectations reflected in such forelooking statements are based upon reasonable assumptions, we can give no assurance that these expectations will be achieved. Please see the forward-looking statements disclaimer in our third quarter earnings press release and the company's filings with the SEC for factors that could cause material differences between forward-looking statements and actual results. The company undertakes no obligation to update any forward-looking statements that may be made in the course of this call. I'll review our financial results after Jamie Farrar, our Chief Executive Officer, discusses some of the quarter's operational highlights. I will now turn the call over to Jamie.

Good morning and thanks for joining today. As we move into the end of the year and look ahead to 2024, the office environment continues to experience both encouraging trends and macro headwinds. We anticipate the macro environment next year will continue to be challenging with a higher for longer interest rate environment and potential economic weakness. Despite that, we believe there will be subsets of the office sector that are going to perform well. I'll highlight where we believe that is going to be and the decisions that we are making to optimally position ourselves. While the last few years have been less predictable than in the past, some clear leasing trends have become apparent. New vintage buildings have dominated leasing despite representing a relatively small percentage of the entire office stock. JLL's recent market research confirms this. Their data identifies that newly constructed office buildings, delivered in 2015 or later, have been winning most of the net absorption over the past three years. We believe tenants' clear preference for premium quality space will continue to support this trend. Not surprisingly, future supply of new development has and will continue to dramatically taper given the sector's uncertainty and a lack of equity in debt capital. Outside of projects already under construction, we expect limited delivery of premium new competitive buildings in the near to medium term. The combination of these two trends, concentration of demand at the top part of the market, along with slowing new construction, should result in rising rental rates and strong operating fundamentals at this top segment of the market. City office is positioned to benefit as these trends play out. Our three most recent acquisitions are top of market buildings with new construction, great locations and leading amenities. The Terraces in Dallas's Preston Center delivered in 2017 and is 100% occupied. Block 23 in downtown Phoenix delivered in 2019 and is now 95% occupied with two well-positioned vacancies that we expect to lease. And our two building Block 83 property in Raleigh delivered in 2019 and 2021 and is 86% occupied with additional leases under negotiation and strong tour activity. These three assets are perfectly suited in today's leasing market and represent a very significant percentage of our overall value. With rental rates for this category of properties likely to continue to grow, these are exactly the sort of assets that you want to own now and for the long term. Peter Haslund, Despite sector challenges we expect these premium new construction buildings will continue to lease up and availability of vacant space within this category will diminish. Peter Haslund, This supply reduction should lead to greater demand for the next highest quality tier of properties. Peter Haslund, This includes buildings that are extremely well located in great cities and have been recently renovated to a very high standard with amenities. The rental rates for this category of property are currently at a significant discount to new vintage buildings. We expect that as the premium buildings become unable to accommodate tenants, rental rate and demand growth will shift to this category. Within our own portfolio, these views have shaped our strategy to position ourselves for winning occupancy. We've either been investing capital in or about to make enhancements to this category of buildings that we own. This includes renovation programs and advancing ready to lease spec suites. Across our portfolio, we have a number of examples within this category. Park Tower is a renovated building that we transformed in downtown Tampa. The Square is a fully renovated asset in an incredible location in Old Town Scottsdale. The Quad in Scottsdale has been fully renovated and has achieved strong and consistent tenant demand. City Centre in downtown St. Petersburg is a fabulous waterfront location. We're finalizing our plans to launch a major repositioning. 5090 is well located in Phoenix's Camelback Corridor. We've just initiated a major upgrade that will complete mid next year. And Pima Centre, located in North Scottsdale, is undergoing a transformational repositioning right now. We've already seen a pickup in leasing demand from the improvements at Pima Centre and will further benefit from the new amenities as the adjacent $80 million entertainment development under construction completes. Bottom line, we see opportunities for outperformance and value creation despite the challenges in certain subsets of the office sector. On a separate note, we enhanced our supplemental financial information package to include additional detail for our leases with WeWork, given their recent filings and restructuring. In total, WeWork leases 177,000 square feet at our three top tier properties that I discussed earlier in Raleigh, Dallas, and Phoenix. WeWork's Raleigh and Dallas operations at our buildings appear to be well occupied. The Phoenix location opened approximately one year ago and is still in a lease up mode with lower occupancy levels. None of our three leases were listed for rejection on WeWork's November 7th filing. All three locations are open and operating and current on rent through the end of October. Despite this, we've been preparing for any potential scenario that could unfold at WeWork. Fortunately, WeWork lease at our most desirable assets and locations. Each of the three properties is newly constructed in a flagship type location for WeWork. In the event they vacated any of these locations, we already have strong interest from leading co-working operators, and are ready to move quickly. Alternatively, we have the option of pivoting to leasing to conventional tenants, given the demand for premium buildings. Bottom line, while these challenges may create some short-term disruptions, our premium locations and phenomenal buildings preserves our strong position. Moving to our results for the quarter, they were in line with our expectations. During the quarter, we executed 119,000 square feet of new and renewal leases. with a 3.1% increase in renewal cash rents versus expiring rents. This follows the industry trend that despite negative absorption, face rental rates have continued to rise driven by top tier and renovated assets. We also had another quarter of positive same store cash NOI growth and achieved a 2.2% increase over the prior year quarter. Year to date, Same-store cash NOI increased by 4.2% as compared to the same period in the prior year. Consistent with our previous messages, we continue to see tenants wanting pre-built space that can be quickly occupied with no construction build-out uncertainty. As a result, we've been focused on ramping up our spec suite inventory. We've increased our spec suite inventory from 54,000 square feet as of June 30th to 92,000 square feet as of September 30th. We have an additional 67,000 square feet that is either under construction or planned for the balance of 2023 and 2024 with active leasing conversations occurring at many of these locations. Currently, we're exchanging proposals for or in final lease negotiations on six spec suites totaling approximately 27,000 square feet. As we head into year end in 2024, Our team remains focused on driving leasing activity and creating value for shareholders. While office REIT stocks continue to trade at steep discounts, we believe the quality of our portfolio and our focus on creating value will reward shareholders over the long term. I look forward to providing further updates on our progress and will hand the call over to Tony Maretic to discuss our financial results.