Easterly Government Properties, Inc.

Greetings. Welcome to the UCLA Government Properties First 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. Please note this conference is being recorded. I will now turn the conference over to your host, Lindsey Winterhalter, Vice President of Investor Relations. You may begin.

Good morning. Before the call begins, please note the use of forward-looking statements by the company on this conference call. Statements made on this call may include statements which are not historical facts and are considered forward-looking. The company intends these forward-looking statements to be covered by the Safe Harbor provisions for forward-looking statements contained in the Private Securities Litigation Act reform of 1995 and is making this statement for the purpose of complying with those Safe Harbor provisions. Although the company believes its plans, intentions, expectations, strategies, and prospects as reflected in or suggested by those forward-looking statements are reasonable, it can give no assurance that these plans, intentions, expectations, or strategies will be attained or achieved. Furthermore, actual results may differ materially from those described in the forward-looking statements and will be affected by a variety of risks and factors that are beyond the company's control, including, without limitation, Those contain in item 1A, risk factors of its annual report on Form 10-K for the year ended December 31st, 2020, filed with the SEC on February 24th, 2021, and in its other SEC filings, and risks and uncertainties related to the adverse impact of COVID-19 on the U.S. regional and global economies and the potential adverse impact on the financial condition and results of operation of the company. The company assumes no obligations to update publicly any forward-looking statements, whether as a result of new information, future events, or otherwise. Additionally, on this conference call, the company may refer to certain non-GAAP financial measures, such as funds from operations, funds from operations as adjusted, and cash available for distribution. You can find a tabular reconciliation of these non-GAAP financial measures to the most comparable current GAAP numbers and the company's earnings release and separate supplemental information package on the investor relations page of the company's website at ir.easterlyrate.com. I would now like to turn the conference call over to Daryl Crate, Chairman of Easterly Government Properties.

Thank you, Lindsay. Good morning, everybody, and thank you for joining us for this first quarter conference call. Today, in addition to Lindsay, I'm also joined by Bill Trimble, the company's CEO, and Megan Bevere, the company's CFO and COO. Easterly continues to consistently execute on its strategy of owning Class A mission-critical facilities leased to the United States federal government. Our story is simple. We seek to own a pristine portfolio of buildings, many built to suit, that are occupied by some of the country's most important tenant agencies. We aspire to be the chosen partner of our tenants to maintain and enhance their facilities to aid in the execution of their missions. We grow our FFO through acquisitions, non-speculative development, and through the renewal of existing assets. Our acquisitions this quarter were consistent with all these objectives. The first quarter of 2021 marks the sixth anniversary of Easterly as a public company. Looking back at the value created during those six years, we're pleased with our progress. We've scaled our platform from 29 to 82 properties through our creative acquisitions and development. We've diversified the tenant base from 12 to 39 U.S. government agencies, each with enduring missions. We've grown the percentage of lease income backed by the full faith and credit of the U.S. government from 96% to 99%. We've increased our stable recurring cash flows in aggregate contractual rent due from the U.S. government from $360 million to $2.1 billion. We've increased our weighted average remaining lease term from 7.7 years to 8.6 years. And finally, we've grown FFO at a compound rate of approximately 4% annually, while also paying a dividend of 4% to 5%. This supports a 9% total of return, which implies a premium of a 730 basis points above treasuries. We are proud that we've delivered this attractive return profile to investors, and we're pleased that the fundamentals of our business remain materially the same going forward as they've been in the past. All of this has been achieved while maintaining the same investment discipline and values we established six years ago. We're not a complicated story. We keep it simple. We purchase and develop U.S. government-leased assets and pass along the stable cash flows and superior tenant credit quality to our shareholders, generating strong risk-adjusted returns. And with a highly actionable pipeline, we believe we'll be able to continue to execute on our original thesis for many years to come. In closing, the fundamentals of our business are strong. Our pipeline is robust and the credit quality of our underlying tenant with leases backed by the full faith and credit of the U.S. government remains the best of any public read out there. We thank you for your continued partnership and engagement as we work to grow this premier portfolio of real estate assets leased to the United States federal government. And with that, I'll turn the call over to Bill to give you insights into the first quarter results.