Cencora, Inc.

Greetings and welcome to the CoreSight Realty Corporation third quarter 2021 earnings conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Kate Ruppe, Investor Relations for CoreSight Realty Corporation. Thank you. You may begin.

Thank you. Good morning and welcome to CoreSite's third quarter 2021 earnings conference call. I'm joined today by Paul Zurich, President and CEO, Steve Smith, Chief Revenue Officer, and Jeff Finnan, Chief Financial Officer. Before we begin, I would like to remind everyone that our remarks on today's call may include forward-looking statements as defined by federal securities laws, including statements addressing projections, plans, or future expectations. These statements are subject to a number of risks and uncertainties that could cause actual results or facts to differ materially from such statements for a variety of reasons. We assume no obligation to update these forward-looking statements and can give no assurance that the expectations will be obtained. Detailed information about these risks is included in our filings with the SEC. Also on this conference call, we refer to certain non-GAAP financial measures such as funds from operations. Reconciliations of these non-GAAP financial measures are available in the supplemental information that is part of our full earnings release, which can be found on the investor relations pages of our website at CoreSite.com. With that, I'll turn the call over to Paul.

Good morning, and thank you for joining our earnings call. I will cover our third quarter and year-to-date highlights, and Steve and Jeff will discuss sales and financial matters in more detail. We delivered another strong quarter of financial results, including operating revenues of $164 million, resulting in 6.4% year-over-year growth, adjusted EBITDA of $86 million, resulting in growth of 5.2% year-over-year, and FFO per share of $1.39, or 4.5% year-over-year growth. We also reported strong operating performance, including cash rent mark-to-market year-to-date of 2.9%, churn year-to-date of 4.6% in line with our expectations, and 5.0% year-over-year MRR per cabinet equivalent growth, driven by strong power and interconnection revenue growth. Today, we will discuss leasing results of $8.9 million, comprised of third quarter leasing of $7.2 million in annualized gap rent, and a $1.7 million scale lease at SV7 signed on October 7th. Demand continues to be positive for deployments and agile interconnection in our network and cloud-enabled data center campuses and major metropolitan edge markets. And we believe supply and demand are generally in balance. As Steve will mention, sales cycles are a bit longer due to other distractions for certain scale customers, but our sales funnel continues to be at a high level relative to our history. Turning to our property development, We executed pre-leases for some of LA3 Phase 2 during the third quarter, and we completed construction of Phase 2 in October. LA3 Phase 1 is now 93% leased, less than 12 months after placing the project into service, reflecting the strength of our position in the Los Angeles market and continued solid sales activity. NY2 Phase 4A, a four megawatt computer room, also remains on track for a Q1 2022 delivery, and we continue to make good progress on the remaining pre-construction activities to bring SV9 to a shovel-ready state, completing demolition of the existing building and working with Silicon Valley Power to finalize power procurement by the end of the year. We are fortunate to have very strong customer ecosystems on our uniquely positioned network and cloud-enabled campuses. which drive diverse demand with good margins and attractive returns, reflecting the value customers can achieve in our environment. Our very capable team continues to add to our campuses important customers with potential for future growth, and our purpose-built, power-efficient, and scalable data center campuses, differentiated by our flexible and diverse interconnection platform, provide ideal environments for secure, high-performance multi and hybrid cloud solutions that enterprises require in order to be cost-effective, agile, and forward-thinking in their deployment of digital solutions. In summary, we are pleased with the progress made during the quarter and see more opportunity ahead to participate in the ongoing migration to a hybrid cloud world with extensive interoperability among customers. With that, I will turn the call over to Steve.