First Industrial Realty Trust, Inc.

Good day, and welcome to the first Industrial Realty Trust, Inc., second quarter 2025 results call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on your telephone keypad. 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 Art Harmon, Senior Vice President of Investor Relations and Marketing. Please go ahead.

Thank you, Michael. Hello, everybody, and welcome to our call. Before we discuss our second quarter of 2025 results and our updated guidance for the year, please note 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, July 17, 2025. 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'll open it up for your questions. Also with us today are JoJo Yap, Chief Investment Officer, Peter Schultz, Executive Vice President, Chris Schneider, Executive Vice President of Operations, and Bob Walter, Executive Vice President of Capital Markets and Asset Management. Now let me hand the call over to Peter.

Thank you, Art, and thank you all for joining us today. Our portfolio continues to perform well, producing strong cash rental rate growth with a solid pace of renewals. Tenant leasing activity and investments to support new growth continue to move at a deliberate pace. The uncertainty around tariffs, whether they will be applied, where and when and to what degree continues to dampen momentum around decision-making. That said, we have a couple of success stories to share in the form of new development leases that I will review shortly. As we said on prior calls, a positive for our business is with new starts at a 10-year low. Even with modest net absorption, the available alternatives for new Class A space continue to diminish. This trend is reflected in the most recent metrics on the broad industrial market reported by CoStar. Vacancy in Tier 1 U.S. markets was 6.3% at the end of the second quarter and up 30 basis points compared to the prior quarter. On the demand side, according to CoStar, net absorption year-to-date totaled 16 million square feet nationally and 5 million square feet in our target markets. We should also point out that there is a wide variation in reported net absorption. Depending upon the source you use, year-to-date net absorption ranges from negative 4 million square feet to positive 63 million square feet. Nationally, new construction start volume was 62 million square feet in the second quarter versus 66 million in the first quarter of 2025, and 72% lower than the peak of third quarter 2022. In our 15 target markets, new starts were 37 million square feet, and completions were 38 million. Space under construction totals 204 million square feet, and that is 42% pre-lease. From a portfolio standpoint, our in-service occupancy at quarter end was 94.2%, in line with our expectations, reflecting the known 708,000 square foot move out in central Pennsylvania, and the impact of two developments placed in service, partially offset by some new leasing. We've now taken care of 88% of our 2025 rollovers by square footage. Our overall cash rental rate increase for new and renewal leasing is 33%, and if you exclude the large fixed rate renewal in central PA we previously disclosed, the cash rental rate increase is 38%. This puts us on track to achieve our overall cash rental rate growth expectations of 30% to 40% and 35% to 45% excluding the fixed rate renewal. Moving now to development. We are pleased to report that after we issued our press release, we leased the remaining 501,000 square feet of the 968,000 square foot building in our Camelback 303 joint venture in Phoenix. That brings the entire three building 1.8 million square foot project to 100% lease. Per our press release, we also leased 58,000 square feet at our first loop project in Orlando. As discussed on our last call, we're underway on two new starts in the corridor. The first is a 176,000 square foot facility at First Park 121 in northwest Dallas. The second is a 226,000 square footer at our First Park Newcastle project in the Philadelphia market. The total estimated investment for both of these projects is $54 million, with target cash yields of approximately 8% for each. Both of these opportunities are located in infill locations with low sub-market vacancies and targets of 50 to 100,000 square foot tenant segments. Turning to our capital markets activity, we reached two important milestones during the quarter. First, we were upgraded by Fitch to BBB Plus in early May. That upgrade was timely, as shortly thereafter, we launched our first public bond offering since 2007 in the form of $450 million of senior unsecured notes at a coupon rate of 5.25%. Demand from fixed income investors was strong, and we appreciate their support for the offering. Let me conclude by saying thank you to my teammates around the country who are executing on our plan and taking care of our customers. With that, I'll turn it over to Scott.