Kite Realty Group Trust

Good day, and thank you for standing by. Welcome to the Kite Realty Group fourth quarter 2025 earnings conference call. At this time, all participants are on a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Brian McCarthy, Senior Vice President, Corporate Marketing and Communications. Please go ahead.

Thank you, and good morning, everyone. Welcome to Pike Realty Group's fourth quarter earnings call. Some of today's comments contain forward-looking statements that are based on assumptions of future events and are subject to inherent risks and uncertainties. Actual results may differ materially from these statements. For more information about the factors that can adversely affect the company's results, please see our SEC filings, including our most recent Form 10-K. Today's remarks also include certain non-GAAP financial measures. Please refer to today's earnings press release, available on our website, for reconciliation of these non-GAAP performance measures to our GAAP financial results. On the call with me today from Kite Realty Group, our Chairman and Chief Executive Officer, John Kite. President and Chief Operating Officer, Tom McGowan, Executive Vice President and Chief Financial Officer, Heath Feer, and Senior Vice President, Capital Markets and Investor Relations, Tyler Henshaw. Given the number of participants on the call, we kindly ask that you limit yourself to one question and one follow-up. If you have additional questions, we ask that you please rejoin the queue. I'll now turn the call over to John.

Okay, thanks Brian, and thanks everyone for joining us today. The fourth quarter concluded a year of outstanding execution by the KRG team. The following highlights underscore the depth and impact of our operational and transactional accomplishments. We leased nearly 5 million square feet of space, and our new leasing volume marked the highest annual volume in the company's history. We leveraged the strong demand for space in our high-quality portfolio to improve our lease structures, embed higher rent escalators, and optimize our merchandising mix. We entered into two joint ventures with GIC, totaling approximately $1 billion of gross asset value. We sold approximately $622 million of non-core assets, which reduced our percentage of ABR coming from power centers by 400 basis points. compared to last year, and increased our exposure to neighborhood grocery, lifestyle, and mixed-use assets. We allocated a portion of the proceeds of these sales to $300 million of stock buybacks at a significant discount to our consensus NAV. Most importantly, our total activity in the year was accretive on an annualized basis. and our net debt to EBITDA remains below our long-term target range of five to five and a half times. We have a relentless team that will capitalize on this momentum and accomplish even more in 2026 and beyond. Turning to our results, our lease rate increased by 120 basis points sequentially, driven by continued demand for space across our portfolio, particularly with anchor tenants. We signed leases with nine anchor tenants in the fourth quarter and a total of 28 during 2025, representing approximately 645,000 square feet. The anchor leasing in 2025 was done at a 24% blended comparable cash spreads, 26% gross returns on capital, and included names like Whole Foods, Trader Joe's, Crate & Barrel, Nordstrom Rack, Sierra, HomeSense, Ulta, and Barnes & Noble. While our box inventory is being absorbed, the anchor demand remains unabated, which allows us to drive better lease terms such as reducing the number of fixed options, limiting use restrictions, and incorporating more favorable co-tenancy clauses. Our small shop lease rate increased 50 basis points sequentially and 110 basis points year over year. We've been on a steady upward trajectory over the last five years, and over the course of 2026, we intend to drive our shop lease rate to new heights. Our focus continues to be on higher long-term organic growth, an effort that will pay dividends long after our sizable sign not open pipeline normalizes. The embedded rent bonds for the portfolio are 180 basis points, a nearly 25 basis point increase from the first quarter of 2024. By shedding lower growth assets and negotiating better annual bumps, we're well on our way to hitting our goal of 200 basis points of embedded escalators in the portfolio. Turning to development, our activities at One Loudon. It's important to appreciate that this is not a run-of-the-mill expansion project. We're adding 86,000 square feet of retail space, 33,000 square feet of highly amenitized office space, 169 full-service hotel rooms, and 429 additional luxury multi-family units to a premier mixed-use asset located in the wealthiest county in the country. The retail portion of the expansion is currently 65% leased to names like Our House, Williams-Sonoma, Pottery Barn, Tate, and Aloe Yoga. In 2025, we took a series of critical steps to transform our portfolio and refine our investment thesis. Together with a world-class partner, we acquired a landmark property in Legacy West and contributed three larger format well-located assets to a second joint venture. Legacy West has been outperforming our original underwriting, and since our acquisition last April, we've signed or opened names like Watches of Switzerland, Ralph Lauren, the Henry, Buck Mason, 7th Avenue, and Adidas. As one of the elite open-air assets in the country, Legacy West has opened the door to a new tier of luxury tenant relationships, and we see a clear opportunity to replicate that success across select assets in our portfolio. We sold 13 properties and two land parcels in 2025 for approximately $622 million. The disposition pool was primarily composed of larger format assets with embedded rent escalators significantly below our portfolio average. The sales also allowed us to shed a total of 21 watch list anchor boxes, representing approximately 578,000 square feet of space. At the beginning of 2025, we indicated there would be an acceleration in our capital recycling activities, and that's exactly what happened. In totality, we were a significant net seller in 2025. Based on where our stock is traded, we leaned into the capital allocution cues by selling larger format, lower growth assets into the private market at yields well inside of our implied cap rate. We redeployed the majority of the proceeds into $300 million of share repurchases at a 9% core FFO yield. In summary, we took advantage of a clear yield arbitrage opportunity. while at the same time de-risking our cash flows and enhancing the growth rate of our portfolio. Looking into 2026, the midpoint of our guidance has limited transaction activity that Heath will address in a moment. As for any transactional activity beyond that, we have previously discussed a possible second round of larger format non-core dispositions to further elevate the quality of our portfolio. Any such recycling would be pursued opportunistically so long as it's minimally disruptive to earnings and otherwise consistent with the objective of last year's dispositions. As always, I want to thank the KRG team for their continued dedication and considerable efforts to deliver strong results and execute on our strategy. I'll now turn the call over to Heath to discuss the details of Q4 and 2026 guidance.