CTO Realty Growth, Inc.

Ladies and gentlemen, thank you for standing by. Welcome to the CTO Realty Growth fourth quarter and year-end 2025 earnings call. At this time, all participants are in the listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you would need to press star 11 on your telephone. You would then hear an automated message advising your hand is raised. And to withdraw your question, please press star 1-1 again. Please be advised that today's conference is being recorded. I would like now to turn the conference over to Jenna McKinney, Director of Finance. Please go ahead.

Good morning, everyone, and thank you for joining us today for the CTO Realty Growth Fourth Quarter 2025 Operating Results Conference Call. Participating on the call this morning are John Albright, President and Chief Executive Officer, Philip Mays, Chief Financial Officer, and other members of the executive team that will be available to answer questions during the call. I would like to remind everyone that many of our comments today are considered forward-looking statements under federal securities laws. The company's actual future results may differ significantly from the matters discussed in these forward-looking statements, and we undertake no duty to update these statements. Factors and risks that could cause actual results to differ materially from expectations are discussed from time to time in greater detail in the company's Form 10-K, Form 10-Q, and other SEC filings. You can find our SEC reports, earnings release, supplemental, and most recent investor presentation on our website at ctoreit.com. With that, I will turn the call over to John.

Thanks, Jenna, and good morning, everyone. We are pleased to report a robust fourth quarter highlighted by record high leased occupancy of 95.9%, same property NOI growth for our shopping centers of 4.3%, and the previously announced acquisition of a shopping center in South Florida. Our strategic focus on shopping centers located in the higher growth southeast and southwest markets of the U.S., along with the proactive asset management leasing, is producing strong results across all areas of our business. Nowhere is this better illustrated than in our retail leasing results. During the fourth quarter, we signed leases for 189,000 square feet, including 167,000 square feet of comparable leases and a cash rent increase of 31%. For the full year, we signed leases for a record 671,000 square feet, including 592,000 square feet of comparable leases and a cash rent increase of 24%. Further, we continue to make meaningful progress backfilling our 10 anchor spaces. As previously announced in the fourth quarter, we signed a lease with a national investment grade retailer at Marketplace at Seminole Town Center for 48,000 square feet. This single lease consolidated the 34,000 square feet formerly occupied by Big Lots, 9,000 square feet of small shop space, and 5,000 square feet of new expansion space. Further, this lease brought us to seven resolved anchor spaces in 2025, totaling 177,000 square feet. Additionally, we are in active negotiations for the three remaining anchor spaces and the value city at Carolina Pavilion, which we expect to get back in early 2026. Notably, all combined, we expect to achieve a positive cash rent spread of approximately 60%, the high end of the targeted range previously disclosed. So while getting these boxes back did result in temporary downtime, it ultimately accelerated our ability to achieve higher rents and stronger tenant credits, along with driving higher customer traffic to the respective center. More broadly, as of year end, our signed not open pipeline stands at 6.1 million, representing approximately 5.8% of annual cash base rents. We believe this pipeline positioned us for meaningful, earnings growth as reflected in our outlook, with almost half of the signed not-open pipeline anticipated to be recognized in 2026 and 100% in 2027. Moving to investment activity, in December, we acquired Pompano City Center, an open-air retail center located on 35 acres in Pompano Beach sub-market of Fort Lauderdale, Florida, for $65.2 million. The property consists of 509,000 square feet of operating space that is currently 92% occupied, plus 62,000 square feet of unfinished shell space, primarily on the second level, presenting future leasing opportunity. Pompano City Center is anchored by Burlington, TJ Maxx, Nordstrom Rack, Ross Dress for Less, and JCPenney. Further, the property enjoys a prime location at a high traffic intersection, offering great visibility and access. This acquisition provides another attractive opportunity to create long-term value through both strategic mark-to-market rent opportunities and incremental leasing. Including the acquisition of Ashley Park, an open-air lifestyle center acquired early in 2025, and $21 million of structured investments originated during 2025, we closed $166 million of investments during 2025, and a weighted average initial cash yield of 9%. Moving to dispositions, last quarter I provided an update about the significant leasing we completed at the shops at Legacy North located in Dallas, Texas. During this quarter, we capitalized on those leasing efforts and sold the shops at Legacy North for $78 million at a cash exit cap of low 5%. While the lease-up of this shopping center took longer than anticipated, We are pleased with the ultimate outcome and the ability to accretively recycle the proceeds into higher-yielding acquisitions. This transaction demonstrates our team's ability to execute value-add strategies at properties, retenanting, increasing occupancy, and bringing rents up to market. As we look ahead, I do want to note a near-term anticipated acquisition. We are under contract to acquire a 384,000 square foot shopping center located in Texas for approximately $83 million. We look forward to announcing the closing of this acquisition in the first quarter of 2026 and providing more details at that time. Additionally, while we have plenty of liquidity under a revolving credit facility to acquire this property, we may elect to fund this acquisition by selling a stabilized property, thus credibly recycling the proceeds to further drive earnings. Finally, while both leasing and capital recycling will add to earnings growth in 2026 and 2027, we never rest here at CTO. We have identified six out parcels for development in our various stages of negotiations with tenants ranging from preliminary to detailed lease negotiations. Three of the six out parcels are for larger boxes and uses we expect to drive significant foot traffic to the respective centers. While each specific opportunity is unique, In general, they average about $5 million of investment capital and low double-digit yield. If completed, we expect the capital to be invested over 2026 and 2027, with leases beginning to contribute to earnings in the second half of 2027. In summary, while we are pleased with our 2025 performance, we're even more excited about the future of CTO. We're beginning to reap the benefits of our strategic business plan, focusing on the right assets in the right markets, along with the proactive leasing and asset management. I'm immensely proud of the team here at CTO and what they have accomplished along with the performance and results they are driving for our shareholders. And with that, I will now hand the call over to Phil.