D/B/A Centerspace

Good morning and welcome to today's Centerspace second quarter earnings conference call. My name is Candice and I will be your moderator for today's call. All lines have been placed on mute during the presentation portion of the call with an opportunity for question and answer at the end. If you'd like to ask a question, please press start followed by one on your telephone keypad. I would now like to pass the conference over to our host, Jo McCormick, Vice Principal of Finance to begin.

CenterSpace's Form 10-Q for the quarter ended June 30, 2022, was filed with the SEC yesterday after the market closed. Additionally, our earnings release and supplemental disclosure package have been posted to our website at centerspacehomes.com and filed on Form 8-K. It's important to note that today's remarks will include statements about our business outlook and other forward-looking statements that are based on management's current views and assumptions. These statements are subject to risks and uncertainties discussed in our Form 10-K filed for the year ended December 31, 2021 under the section titled Risk Factors and in our other filings with the SEC. We cannot guarantee that any forward-looking statement will materialize and you are cautioned not to place undue reliance on these forward-looking statements. Please refer to our earnings release for reconciliations of any non-GAAP information which may be discussed on today's call. I'll now turn it over to our CEO, Mark Decker, for the company's prepared remarks.

Thanks, Joe, and good morning, everyone. Joining me this morning is Ann Olson, our Chief Operating Officer, and Bharat Patel, our Chief Financial Officer. It remains an incredible time to be in the housing business. While it appears clear that the industry's strong growth is primarily attributable to inflation, which we're witnessing on both revenues and expenses, the fundamentals of our business, Supply-demand, traffic, and the attractiveness of renting versus owning a home remain outstanding, and I've never been more optimistic about our business. In light of the current environment and our positive results for the quarter, we're increasing our outlook for the year. Our NOI growth will drive an increase of nearly 14% in core FFO, and we've now been able to grow same-store NOI and core FFO each consecutive year since 2018. This is a track record few can match and a testament to the resiliency of our portfolio. Turning to investments, as you can see, we spent over $1 million conducting due diligence on a significant pursuit that we abandoned. This was a roughly $2 billion portfolio that would have given us scale in several new markets and accelerated our strategy. We got almost all the way down the road. Alas, as some of the large portfolio deals got announced in December and January, Our counterpart looked into the white-hot market and concluded that selling things individually versus as a portfolio would result in the best outcome for their constituents, and they went in another direction just weeks before we got to an announcement. It was a great effort by our team, and we'll learn something and take that forward. We strive every day to improve the company, and while the current capital market environment is choppy, we're encouraged that these conditions may benefit lower-leverage, longer-term-oriented investors like CenterSpace and we remain active in our pursuit of opportunities large and small. Our key criteria remain portfolio improvement, per share earnings quality, greater distributable cash flow. Our team continues to deliver awesome results and foster a culture of improvement and team orientation. Two great highlights that bring this point home. First, for the third year in a row, we were named a top workplace in Minnesota by the Star Tribune. Congrats on that, as well as a big congratulations to our team for receiving the National Apartment Association's inaugural award for leading organization in diversity, equity, and inclusion. This national award recognizes our work to be a place where people can belong and take risks to improve. Our reach will always exceed our grasp, and it's never perfect, but as they say, it's the courage to continue that counts. Well done, team, and thank you. CenterSpace has considerable momentum as 2023 comes into focus. And now, Anne, would you please provide a quick ops update?