First Industrial Realty Trust, Inc.

Good day and thank you for standing by. Welcome to the first industrial second quarter 2021 earnings conference 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'll need to press star 1 on your telephone. Please be advised that today's conference is being recorded. If you require any further assistance, please press star zero. I would now like to hand the conference over to your host, Mr. Art Harmon, Vice President of Investor Relations. Thank you. Please go ahead, sir.

Thank you, Katrina. Hello, everybody, and welcome to our call. Before we discuss our second quarter 2020 results, as well as updated guidance, let me remind everyone that our call may include forward-looking statements as defined by federal securities laws. These statements are based on management's expectations, plans, and estimates of our prospects. Today's statements may be time-sensitive and accurate only as of today's date, Thursday, July 22, 2021. We assume no obligation to update our statements or the other information we provide. Actual results may differ materially from our forward-looking statements, and factors which could cause this are described in our 10-K and other SEC filings. You can find a reconciliation of non-GAAP financial measures discussed in today's call in our supplemental report and our earnings release. The supplemental report, earnings release, and our SEC filings are available at firstindustrial.com under the Investors tab. Our call will begin with remarks by Peter Basile, our President and Chief Executive Officer, and Scott Musil, our Chief Financial Officer, after which we will open it up for your questions. Also on the call today are Jojo Yap, our Chief Investment Officer, Peter Schultz, Executive Vice President, Chris Schneider, Senior Vice President of Operations, and Bob Walter, Senior Vice President of Capital Markets and Asset Management. Now let me turn the call over to Peter.

Thanks, Art, and thank you all for joining us. Our team delivered another great quarter highlighted by strong operating results, robust development leasing, and more investment for growth. Our efforts were supported by the overall economy, and the industrial real estate sector continued to gain momentum throughout the second quarter. Due to strong second quarter performance and the overall strength of the sector, we are increasing our FFO guidance, which Scott will walk you through shortly. Per CBRE's flash report, net absorption was a healthy 85 million square feet in the second quarter, while completions came in at a three-year quarterly low, of 52 million square feet completions were impacted by reduced construction activity in 2020 as well as the continuing limited availability of readily developable land in highly sought after locations through the first half of this year net absorption was 150 million square feet outpacing new supply of 106 million in the second quarter We were successful in driving occupancy while continuing to increase rental rates on new and renewal leasing. In-service occupancy at quarter end was 96.6%, an increase of 90 basis points from the end of last quarter. This increase in occupancy was accompanied by a 15.7% increase in cash rental rates on new and renewal leasing. The strength and breadth of tenant demand also carried over to our development investments, evidenced by 1.2 million square feet of development leases signed in the second quarter and third quarter to date. We are pleased to announce that our 250,000 square foot building at First Logistics Center at 7881 in central Pennsylvania is now 100% leased to a leading consumer products company. This takes care of the largest vacancy among our completed developments. Also in Pennsylvania, we successfully leased the 100,000 square foot First Independence Logistics Center to the United States Postal Service. In Houston, at our first Grand Parkway Commerce Center, we signed two leases totaling 117,000 square feet, bringing the two-building, 372,000 square foot project there to 55% leased. In Dallas, we just leased 97,000 square feet at first park 121 to a logistics provider bringing the two building 345,000 square foot phase of that park to 64% leased. This is in addition to the 125,000 square foot pre-lease at the last phase of the park that we started in the second quarter as discussed on our last call. We also achieved significant new leasing at our developments in process. In South Florida, we pre-leased 100% of the 259,000 square foot Building 2 at First Park, Miami to a logistics and transportation company. This building is scheduled for completion in the fourth quarter, and the lease is expected to commence in mid-first quarter of 2022. This same tenant also pre-leased 50% of our next start in that park, which I will discuss shortly. We also leased 100% of the soon-to-be-completed 141,000 square foot First 95 Distribution Center in Pompano. The lease will commence by October 1st. Given the strong demand and the ability of our team to replenish our pipeline with profitable development opportunities, we're excited to share several new development starts. In Nashville, we were successful in winning a 692,000 square foot built-to-suit with a leading specialty e-commerce retailer. Completion is slated for the third quarter of 2022. Our projected investment is $59 million. and with a projected cash yield of 6.4%. Taking advantage of the tenant demand we are seeing in South Florida, at First Park Miami, we will start a 219,000 square footer known as building one. As I just noted, we inked a lease for 50% of the space in advance of going vertical. Total estimated investment is 39 million with a targeted cash yield of 5.3%. We are also well positioned for future growth at that park. In addition to what's already underway, I remind you that we can develop another 405,000 square feet on land we own today, and we control another 59 acres developable to 1.3 million square feet for a total build-out of up to 2.5 million square feet. Also in Florida, in the Orlando market, we are starting First Loop Logistics Park. First Loop is a four building project totaling 344,000 square feet with an estimated investment of 45 million and a cash yield of 5.6%. In Seattle, we've launched First Steel, a 129,000 square footer. Estimated total investment is 24 million with a targeted cash yield of 4.7%. In the second quarter, we acquired a strategic site in the I-78-81 corridor of central Pennsylvania for $83 million. Known as First Logistics Center at 283, we have begun construction on the 1.1 million square foot Building A. The site can also accommodate a 700,000 square foot building, which is permit ready. This location is proximate to major parcel hubs for UPS, FedEx, and the U.S. Postal Service, where tenants serve strong East Coast consumption zones. Our total projected investment for the first building is $125 million, with completion targeted for the third quarter of 2022. and an estimated cash yield of 5.1%. In summary, these newly announced development starts totaled 2.5 million square feet with an estimated investment of approximately 291 million and a cash yield of 5.4%. Including these planned new development starts, our development in process total 5.7 million square feet with a total investment of $608 million. At a cash yield of 5.8%, our expected overall development margin on these projects is approximately 50%. We are excited about this robust pipeline and what it means for future cash flow growth. To further bolster our development pipeline, we acquired the remaining 138 acres at our PV303 joint venture for $21.5 million. This price reflects a $10.2 million reduction from our share of the gain and our earned promote from the joint venture. This purchase closes out a very successful JV, which generated a largely unlevered 54% IRR for the partners, and gives us another prime landholding to serve tenants' needs in this high-demand logistics corridor. In addition, just last week, we closed on a 95-acre site in the Inland Empire East sub-market of Banning for $27 million that can accommodate up to a 1.4 million square footer. Vacancy in the Inland Empire East is just around 2%, and there are limited sites that can meet customer requirements in this size range. In total, our balance sheet land today can support more than 12.5 million square feet of new investments, and our share of the Camelback Joint Venture is around 3.8 million square feet. So we are very well positioned for future growth. Second quarter building acquisitions were comprised of an 81,000 square foot distribution facility in Orlando and a 33,000 square foot regional warehouse in Denver. Total investment was $18.4 million and the combined stabilized cash yield is 5.6%. Moving on to sales, during the quarter we sold three properties and one unit for $26.2 million and an in-place cap rate of approximately 5.4%. We also sold one land parcel for $11 million. In total, we have sold $104 million year to date and have reached the low end of our sales guidance range of $100 million to $150 million. Before I turn it over to Scott, who will discuss more details on the quarter and our line of credit and term loan executions, Let me express my heartfelt thanks to the entire First Industrial team for their hard work and many contributions to our very successful second quarter. With that, let me turn it over to Scott.