Essential Properties Realty Trust, Inc.

Good morning, ladies and gentlemen, and welcome to Essential Properties Realty Trust's third quarter 2022 earnings conference call. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. This conference call is being recorded, and a replay of the call will be available two hours after the completion of the call for the next two weeks. The dialing details for the replay can be found in yesterday's press release. Additionally, there will be an audio webcast available on Essential Properties' website at www.essentialproperties.com, an archive of which will be available for 90 days. It is now my pleasure to turn the call over to Dan Donlan, Senior Vice President and Head of Capital Markets at Essential Properties. Thank you, sir. Please go ahead.

Thank you, Operator, and good morning, everyone. We appreciate you joining us today for Essential Properties' third quarter 2022 conference call. Here with me today to discuss our operating results are Pete Mavoris, our President and CEO, and Mark Batten, our CFO. During this conference call, we will make certain statements that may be considered forward-looking statements under federal securities law. The economy's actual future results may differ significantly from the matters discussed in these forward-looking statements, and we may not release provisions to these forward-looking statements to reflect changes after the statements were made. For Atterson Risk Technology, actual results differ materially from expectations or are disclosed from time to time in great detail in the company's volumes of the SEC and in yesterday's earnings press release. With that, Pete, please go ahead.

Thank you, Dan. And thank you to everyone who is joining us today for your interest in essential properties. As our third quarter results indicate, our portfolio continues to perform at a high level with record level unit level coverage of 4.2 times. Same store rent growth of 1.7% and just three vacant properties. This strong performance is a testament to our disciplined underwriting process, the resiliency of our service-oriented and experience-based tenancy, and our consistent recycling of capital out of weak-performing properties. On the investment front, we remained active in support of our long-standing tenant relationships, and we continued to adjust cap rates and sellers' expectation throughout the quarter to better reflect the abrupt moves in the capital markets. With quarter-end leverage of 4.4 times and liquidity of nearly $900 million, our balance sheet is well capitalized for continued investment. We are committed to maintaining a conservative balance sheet, and investors should expect us to remain well within our historical leverage range of 4.5 times to 5.5 times. We are establishing 2023 AFFO per share guidance at $1.58 to $1.64, which implies 5% growth midpoint to midpoint. This earnings growth projection relative to the double-digit growth experienced over the last two years Mostly results from our measured external growth outlook, current volatility in the capital markets, and underlying investment spreads. Turning to the portfolio, we ended the quarter with investments in 1,572 properties that were 99.8% leased to 329 tenants operating in 16 industries. Our weighted average lease term stood at 14 years with only 4.2% of our ABR expiring through 2026. From a tenant health perspective, our weighted average unit level coverage ratio sequentially improved to 4.2 times this quarter with our percentage of ABR under one times coverage declining to just 3.7% of ABR versus 6.4% last quarter. We expect this positive trend among our lowest coverage cohorts to continue as these statistics still remain negatively skewed by our trailing 12-month reporting convention, which lags our own reporting by one or two quarters, and the fact that various municipalities were still placing capacity restrictions on certain industries in the back half of 2021. During the third quarter, we invested $195 million through 27 separate transactions at a weighted average cash yield of 7.1%, which was up 10 basis points versus the prior quarter. These investments were made in 13 different industries with approximately 60% of our activity coming from the quick service restaurant, equipment rental, medical, and casual dining industries. The weighted average lease term on our investments This quarter was 16.5 years. The weighted average annual rent escalation was 1.6%. The weighted average unit level coverage was 4.4 times. And the average investment per property was $3.8 million. Consistent with our investment strategy, 89% of our quarterly investments were originated through direct sale leasebacks. which are subject to our lease form with ongoing financial reporting requirements, and 68% contain master lease provisions. Looking ahead to the fourth quarter, we have closed $60 million of investments to date, and our pipeline remains active at increasingly higher cap rates. From an industry perspective, early childhood education remains our largest industry at 13.5% of ABR. followed by quick service restaurants at 12.6%, medical and dental at 11.4%, and car washes at 11%. Of note, unit level coverage for our early childhood education portfolio continues to increase above pre-pandemic levels as our operators have experienced strong pricing power due to favorable supply-demand imbalance. From a tenant concentration perspective, Our largest tenant represents 3.7% of ABR at quarter end, and our top 10 tenants account for only 19.4% of ABR. Tenant diversity is an important risk mitigation tool and differentiator for us, and it is a direct benefit of our focus on unrated tenants and middle market operators, which offers an expansive opportunity set. In terms of dispositions, We sold 12 properties this quarter for $35.5 million in net proceeds at a 6.2% weighted average cash yield with a weighted average unit level coverage of 1.2 times. As we have mentioned in the past, owning fungible and liquid properties is an important aspect of our investment discipline as it allows us to proactively manage industries, tenants, and unit level risks within the portfolio. We expect our level of dispositions to remain elevated in the fourth quarter as cap rates for individual granular properties remain near historic lows. With that, I'd like to turn it over to Mark Patton, our CFO, who will take you through the financials and the balance sheet for the second quarter. Mark?