NetSTREIT Corp.

Welcome to the NetStreetCorp first quarter 2021 earnings 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. Please note this conference is being recorded. I will now turn the call over to Amy Ahn. Please go ahead.

We thank you for joining us for NetStreet's first quarter 2021 earnings conference call. In addition to the press release distributed yesterday after market closed, we posted a supplemental package and an updated investor presentation. Both can be found in the investor relations section of the company's website at www.netstreet.com. On today's call, management's remarks and answers to your questions may contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements address matters that are subject to risk and uncertainties that may cause actual results to differ from those discussed today. For more information about these risk factors, we encourage you to review our Form 10-K for the year ended December 31, 2020, and other SEC filings. All forward-looking statements are made as of the date hereof, and NetStreet assumes no obligation to update any forward-looking statements in the future. In addition, certain financial information presented on this call includes non-GAAP financial measures. Please refer to our earnings relief and supplemental package for definitions, GAAP reconciliation, and an explanation of why we believe such non-GAAP financial measures are useful to investors. Today's conference call is hosted by NetStreet's Chief Executive Officer, Mark Manheimer, and Chief Financial Officer, Andy Walker. They will make some prepared remarks, and then we will open the call for your questions. Now, I will turn the call over to Mark.

Good morning, everyone, and thank you for joining us today for NetStreet's first quarter 2021 earnings call. We are pleased to be here with you today. I'll start with our portfolio metrics and recent acquisitions activity, and then take a moment to discuss our pipeline and continued focus on external growth in light of our recent transformative equity race. Andy will then provide more detail on our first quarter results and balance sheet. He will also update you on our expanded outlook, including AFFO guidance for 2021. We will then open the call for questions at the end of our prepared remarks. As of March 31st, 2021, our portfolio contained 235 leases comprising of 4.4 million square feet in 39 states with a diversified tenant roster of 60 tenants in 23 industries. Our weighted average lease term is 10.1 years. We are 100% occupied with no lease expirations until 2023 and less than 2% of ABR expiring before 2025. Based on ABR, our tenancy is 70% investment grade, with an additional 11% classified as investment grade profile, and 89% of our industry exposure is what we refer to as defensive. We continue to focus on well-positioned tenants who have strong balance sheets and great access to capital, and on physical locations that are integral to the tenant's ability to generate cash flow. Finally, let me remind you that we do not own or intend to own theater, health club, or early childhood education tenants, as these tenants typically have weaker credit profiles and real estate that is often cost prohibitive to efficiently adapt to other use. Our strategic approach to portfolio construction has resulted in strong collections through COVID. Through this April, we have collected 100% of rents for each of the past eight months. This steady operational performance has allowed us to focus on our external growth plan. In the first quarter, all of our acquisitions were either with investment-grade tenants or with tenants with investment-grade profiles. We completed $88.2 million of acquisitions at an initial cash capitalization rate of 6.7% and a weighted average lease term of 8.8 years. Subsequent to quarter end, we extended two of these leases that increased the weighted average lease term from 8.8 years to 9.6 years with an impact of only six basis points to the quarter's going-in cash cap rate. We also provided $1.3 million of funding towards an estimated $4.4 million development project for an investment-grade tenant that is expected to be completed in the next few quarters. We also acquired two more O'Reilly's auto parts stores in New England at a 6.9% cap rate with more than 10 and a half years of lease term as an add-on transaction to a portfolio done in 2020. These are good examples of our ability to extend leases as part of our acquisitions and grow our opportunity set through providing development capital for our target tenants. Our multi-pronged acquisitions approach allows us to sift through a broad opportunity set and pursue where we see the best risk-adjusted returns with the highest quality tenants in all retail throughout the country. The different approaches have allowed us to add several new tenants to our portfolio, including Marshalls, Natural Grocers, Ross Stores, and Wawa. As we look ahead, our pipeline continues to grow in size, and we are excited about our ability to execute on our external growth strategy. Earlier in the month, we raised our acquisitions guidance to $360 million from $320 million. And to fund that effort, we subsequently completed a transformational, well-oversubscribed equity offering that allowed us to reload our balance sheet with approximately $194 million of additional direct power. We view this offering as a milestone for NetStreet, given its expected impact on our future growth. We continue to review a wide breadth of opportunities, including investments in stabilized assets, blend and extend opportunities, debt leaseback transactions, and development projects. We will continue to target the same industries and a similar mix of investment grade and high-quality tenants that currently make up our portfolio. We do expect to continue to grow the portfolio, but we are also focused on diversification as well as enhancing the overall quality of our portfolio. Finally, we expect that cap rates and lease terms will be generally consistent with what you've seen from us over the past few quarters. We are truly excited by the opportunity ahead of us, as we know that execution on our external growth effort should result in extremely attractive earnings per share growth, given our size. As I mentioned previously, but bears repeating, our track record of 100% rent collections for the past eight months means that we have not been distracted by chasing rents or workouts with problem tenants. We remain focused and have diligently built a strong pipeline of acquisitions. Over the past 16 months, we have raised over $600 million of equity capital in three separate transactions, with our 144A offering, our IPO, and our most recent follow-on. We have historically deployed each capital raise efficiently and accretively. With the completion of our recent follow-on offering, we remain laser-focused on growth. We will continue to keep you updated on our progress. I'll now turn the call over to Andy to discuss the balance sheet and our capital markets activities. Andy?