Postal Realty Trust, Inc.

Greetings and welcome to Postal Realty Trust's fourth 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. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Mr. Jordan Kuperstein, Vice President of FP&A Capital Markets. Please go ahead.

Thank you. Good afternoon, everyone, and welcome to the Postal Realty Trust's fourth quarter and year-end 2021 earnings conference call. On the call today, we have Andrew Spodek, Chief Executive Officer, Jeremy Garber, President, Robert Klein, Chief Financial Officer, and Matt Brandwein, Chief Accounting Officer. Please note the use of forward-looking statements by the company on this conference call. Statements made on this call may include statements that are not historical facts and are considered forward-looking. These forward-looking statements are covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those described in the forward-looking statements and will be affected by a variety of risks and factors that are beyond the company's control, including, without limitation, those contained in the company's latest 10-K and its other Securities and Exchange Commission filings. The company does not assume and specifically disclaims any obligations to update any forward-looking statements whether as a result of new information, future events, or otherwise. Additionally, on this conference call, the company may refer to certain non-GAAP financial measures, such as funds from operations, adjusted funds from operations, and adjusted EBITDA. You can find a tabular reconciliation of these non-GAAP financial measures to the most currently comparable GAAP measures in the company's earnings release and supplemental materials. I will now turn the call over to Andrew Spodek, Chief Executive Officer of Postal Realty Trust.

Good afternoon and thank you for joining us today. Postal Realty Trust produced a strong 2021, exceeding our acquisition target for the year. We acquired 239 properties for approximately $118 million at a weighted average cap rate of between seven and seven and a half percent. Notably, more than three quarters of our acquisitions were sourced off market, demonstrating our access in the industry. We continue to execute on our postal property consolidation strategy and to grow our stable cash flows from our in-place rents. We see an enormous opportunity within this large, highly fragmented market. We are the leading owner of properties leased to the Postal Service, and with only a 5% market share, we have a significant opportunity in front of us to make additional accretive investments. Furthermore, with increased financial capacity on our balance sheet, and deep-rooted knowledge of our market, we are well positioned to support the company's ongoing growth. Heading into 2022, similar to the broader real estate industry, we are continuing to see cap rate compression. But with our extensive network and robust pipeline, we are confident our acquisitions will exceed $100 million, with current deal flow trending in the 6% to 8% cap rate range. Notwithstanding our experience and successful execution to date, it is important to invest in our platform to further expand our moat, extend our leading position, and continue to scale. This year, we are making investments in our technology and enterprise systems to allow us to even better utilize our proprietary and industry-leading data, enhance operational efficiency, and support our ongoing growth. As part of our investment, we are excited to have closed on the acquisition of Real Estate Asset Counseling, commonly known as REAC. a highly regarded consulting firm in the postal real estate industry, founded by former senior postal service real estate executives. For almost 30 years, REAC has advised the postal ownership community by providing assistance with lease negotiations, due diligence, and property development, along with many other services. REAC brings decades of experience, relationship, and proprietary data under our umbrella. strengthens our competitive advantage within the industry and adds additional insight and understanding to our sourcing and underwriting of acquisitions. We look forward to REAC contributing value to our consolidation strategy. We continue to receive interest from potential sellers who understand the value proposition in working with Postal Realty. As we have stated over the years, our financial capacity, proven track record, and ability to offer multiple sources of consideration such as operating partnership units, makes us the natural buyer of assets leased to the Postal Service. The Postal Service has proven to be an incredibly stable tenant across every economic cycle. It has created an irreplaceable logistics network that includes critical infrastructure to support the ever-growing e-commerce industry. In fact, this week Congress passed legislation to overhaul the U.S. Postal Service's finances and delivery services further ensuring its continued endurance. The key elements of this legislation include reforming health benefits, shifting much of the retiree benefits to Medicare, and repealing the requirement that the Postal Service prepay future retirement health benefits, thereby helping to improve their finances in a meaningful way. We believe this legislation provides further validation of the importance of the Postal Service to this country's infrastructure and our business strategy of accretively aggregating the properties that support these important services for years to come. As we continue to acquire postal properties and maintain our leading position within the postal real estate space, we continue to be a resource to the Postal Service in their current and future needs. As we move ahead, we have an experienced team, stable and secure cash flows, a proven ability to effectively own and operate properties, and a robust pipeline, all of which supports our confidence to create value for our stakeholders. I'll now turn the call over to Jeremy.