Four Corners Property Trust, Inc.

to the FCPT fourth quarter 2020 financial results conference call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing star then zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on a touch-tone phone. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Jerry Morgan. Please go ahead.

Thank you. During the course of this call, we will make forward-looking statements which are based on beliefs and assumptions made by us. Our actual results will be affected by known and unknown factors, including uncertainty related to the remaining scope, severity, and duration of the COVID-19 pandemic that are beyond our control or ability to predict. Our assumptions are not a guarantee of future performance, and some will prove to be incorrect. For a more detailed description of potential risks, please refer to our SEC filings, which can be found at fcpt.com. All the information presented on this call is current as of today, February 18th, 2021. In addition, reconciliation to non-GAAP financial measures presented on this call, such as FFO and AFFO, can be found in the company's supplemental report, also available on our website. With that, I'll turn the call over to Bill.

Thank you, Jerry. Good morning. Thank you to everyone for joining us to discuss our fourth quarter results, which we are very pleased with in terms of continued strong collections, high acquisition volumes, meaningful equity capital raised, and the continued growth of the FCPTT. While this pandemic period has been one of the most challenging operating periods for the restaurant industry overall, it is important to distinguish between different restaurant types and specifically the kind of properties that Four Corners owns. Our buildings are typically suburban. and are not located in central business districts of large cities. They're not one-off concepts, but instead are part of large branded companies who are often publicly traded enterprises. These restaurant operators have proven resilient in adjusting their business models. Our casual dining tenants remain in rebound mode, but our QSR tenants are often reporting results above pre-COVID levels. We are watching with interest the stimulus discussions in Washington that could result in a significant federal support in the restaurant industry as well as the end consumer. As we have seen with our Carol Group, Darden, and other casual dining operators, EBITDA margins have improved because of simplified menus, lower levels of dining room staffing, higher profitability for to-go businesses, investment in technology, and a significant focus on overhead efficiency. Our collections at quarter end, we had collected 99.7 of scheduled 2020 rents, That is an impressive accomplishment for our tenant operators and for our team who had worked hard engaged with our tenants this year. We continue to see strong collections in this range for 2021 to date. We are working with tenants in three locations representing less than 0.2% of portfolio rents to either modify their lease or terminate and then release the building. Otherwise, we are not seeing rent deferral requests from our tenants, but instead are spending time with them on potential expansion opportunities in connection with our joint venture. Our Caro subsidiary in San Antonio, which operates six long-term state houses, continues to also be impacted by COVID restrictions. Caro provides a wonderful window and real-time understanding into what our tenants are doing to adapt. The Caro team's hard work resulted in a return to profitability in the third quarter with positive EBITDA of $110,000 and an increase in profitability in the fourth quarter to positive EBITDA of $244,000. My thanks to Carol Diltz and her team who run these restaurants and have shown year how skilled and committed they are we broke ground in october to construct our seventh carroll longhorn restaurant in the live oaks area of san antonio which will open in early in the second quarter and is located next to a new olive garden property that we acquired in july we reported fourth quarter afvo per share of 37 sets which represents a cent year-over-year increase we are set up well for growth in 2021 as much of the 100 million dollars of acquisitions in the quarter occurred toward the end and we delivered the balance sheet with $88 million in equity raised by the ATM at an average price of $28.66 per share. Turning to acquisitions, in the quarter we acquired 48 properties for a combined purchase price of $103 million and an initial weighted average cash yield of 6.4%. Looking at 2020 in total, we acquired or made investments into 101 properties totaling $233 million, even with pause in acquisitions for most of the second quarter. Approximately 50% of these properties were sourced out of the out parcel strategy, and therefore many of the properties were set up as ground leases with lower rents. As evidenced of the quality of the 2020 acquisitions, 71% of the leases are with the brand's corporate operator or guaranteed by the corporate entity, and 45% of the leases are ground leases where FCPT owns the land and the tenant constructed the building. Now let me update you on the vacant venture with Luper Dadler that we announced in October. We are very active in the vacant venture. We have formally underwritten over 1,000 properties, held conversations with dozens of tenants, and have issued a number of letters of intent. The thesis that there would be obviously well-located properties that had formerly been weak brands is confirmed, and so is tenant interest in strong brands in growth mode. That said, pricing remains difficult, so we're turning over a lot of rocks, but believe pricing will improve over time. As a reminder, we will announce these transactions in our quarterly results rather than the day they close, as we do with other FCPT acquisitions. We're learning a lot about what defines good locations in our tenants' eyes, specific to each tenant, and Lupert Adler has been a great partner so far. They bring a lot to the table. Just a quick comment on the acquisition environment for leased buildings. It's very competitive, especially for QSR properties. We are in a low interest rate environment, and the financing markets are aggressive. High leverage buyers are pushing up pricing. We intend to remain disciplined and will continue to focus on making quality acquisitions, and our pipeline is strong. In summary, we posted 99.6% rent collections for Q4 that I believe are the highest in the net lease sector and which we hope and expect to continue to go forward. We acquired 48 properties in the quarter, and the team is excited to be building the portfolio and making progress on the venture with Rupert Adler. Jerry?