Essential Properties Realty Trust, Inc.

Good morning, ladies and gentlemen, and welcome to the Essential Properties Realty Trust third quarter 2024 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, and a replay of the call will be available three hours after completion of the call for the next two weeks. The dial-in 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. On the call this morning are Pete Mavadi, President and Chief Executive Officer, Mark Patton, Chief Financial Officer, Rob Salisbury, Head of Capital Markets, Max Jenkins, Head of Investments, and A.J. Peel, Head of Asset Management. It is now my pleasure to turn the call over to Rob Collison. Please proceed, sir.

Thank you, operator. Good morning, everyone, and thank you for joining us today for Essential Properties' third quarter 2024 earnings conference call. During this conference call, we will make certain statements that may be considered forward-looking statements under federal securities law. The company's actual future results may differ significantly from the matters discussed in these forward-looking statements, and we may not release revisions to those forward-looking statements to reflect changes after the statements were made. Factors and risks that could cause actual results to differ materially from expectations are disclosed from time to time in greater detail in the company's filings with the SEC and in yesterday's earnings press release. With that, I'll turn the call over to Pete.

Thank you, Rob, and thank you to everyone joining us today for your interest in essential properties. On our last earnings call, we discussed how our portfolio continued to exhibit strong operating trends against a dynamic market backdrop. This resilient portfolio performance continued during the third quarter with high occupancy, healthy same-store growth, and improving credit trends. As a long-term capital provider focused on owning real estate at a conservative basis, leased under our lease form to growing operators in service and experience-based industries, we expect our portfolio to perform at a high level. Maintaining relationships with and providing value to operators continues to drive investment activity as well. In the third quarter, 79% of our investments were generated from existing relationships, underscoring the value of recurring business with our tenant base. With quarter-end pro forma leverage of 3.5 times and liquidity of $1.2 billion, our balance sheet positions us well to continue to grow our portfolio by investing in our core industries at attractive spreads, generating sustainably attractive earnings growth for our shareholders. We are establishing our 2025 AFFO per share guidance range of $1.84 to $1.89, which implies a growth rate of over 7% at the midpoint. Our guidance for 2025 reflects continued portfolio performance and a steady pace of investments with cap rates expected to compress modestly over the coming quarters as competition reemerges through the continued normalization of capital market conditions. Specifically, we expect to invest between $900 million and $1.1 billion in 2025 at approximately 25 basis points below the pricing achieved in 2024. Additionally, we expect cash G&A expense to be between $28 million and $31 million, resulting in continued efficiency gains as a percentage of revenue, as the company is able to invest in its infrastructure while still scaling the platform to generate stronger margins for shareholders. We ended the quarter with investments in 2,053 properties that were 99.9% leased to 407 tenants operating in 16 industries. Our weighted average lease term stood at 14.1 years at quarter end, which is up year over year, with only 3.9% of annual base rent expiring through 2028. From a tenant health perspective, our weighted average unit level rent coverage ratio was 3.6 times this quarter, indicative of of the strong profitability of our tenants at the unit level. Same store rent growth in the third quarter was 1.4%. Over the past month, two hurricanes hit the southeastern United States. Our thoughts and prayers go out to the people, business owners, and operators impacted by these storms as they rebuild in the aftermath. Looking at our portfolio, we own 103 properties located in areas identified as severely impacted by FEMA, of which five properties reported damage causing substantial disruption and warranting an insurance claim. As a reminder, as a condition to providing our capital in a leaseback transaction, our tenants are required to enter into our lease agreement, which requires them to maintain property rent, and business interruption insurance. This provides an important layer of safety for our portfolio in the event of property damage events such as hurricanes. On the investment side, during the quarter, we invested $308 million through 37 separate transactions at a weighted average cash yield of 8.1%, up slightly from last quarter and up 50 basis points from a year ago. Our investment activity in the quarter was broad-based across most of our top industries, with no notable departures from our investment strategy. This quarter, our investments had a weighted average initial lease term of 17.2 years and a weighted average annual rental escalation of 2.1%, generating an average gap yield of 9.1%. Our investments this quarter had a weighted average unit level rent coverage of 4.7 times, and the average investment per property was 4.1 million. The vast majority of the investments in this quarter were originated through direct sale leasebacks. Looking ahead to the fourth quarter, our investment pipeline remains solid, reflecting M&A and new unit expansion activity across a variety of our targeted industries. As we have discussed in the past, we expect the normalization of the capital markets to result in increased competition, causing modest cap rate compression in the near term. We have not yet seen this in our current pipeline, which implies cap rates remaining similar to the past four quarters. From a tenant concentration perspective, our largest tenant represents 4.3% of ABR at quarter end, And our top 10 tenants now account for just 17.7% of ABR. Tenant diversity is an important risk mitigation tool and a differentiator for us, and it is a direct benefit of our focus on middle market operators, which offers an expansive opportunity set. Dispositions were in line with our trailing eight-quarter average in Q3. We sold nine properties this quarter for $17 million in net proceeds. This represents an average of approximately $1.9 million per property, highlighting the importance of owning fungible liquid properties, which allows us to proactively manage portfolio risks. The dispositions this quarter were executed at a 6.8% weighted average cash yield, Over the near term, we expect our disposition activity to remain in line with our trailing eight-quarter average, driven by opportunistic asset sales and ongoing portfolio management activity. With that, I'd like to turn the call over to Mark Patton, our CFO, who will take you through the financials and balance sheet for the quarter.