Sila Realty Trust, Inc.

Good morning and welcome to SILA Realty Trust Third Quarter 2025 Earnings Conference Call and Webcast. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the start key followed by zero. I will now turn the conference over to your host, Drew Miles, Senior Associate of Capital Markets and Investor Relations for SILA. You may begin.

Good morning, and welcome to CELA Realty Trust's third quarter 2025 earnings conference call. Yesterday evening, we issued our earnings release and supplement, which are available on the investor relations section of our website at investors.celarealtytrust.com. With me today are Michael Seaton, President and Chief Executive Officer, and Kay Neely, Executive Vice President and Chief Financial Officer. Before we begin, I would like to remind you that today's comments will include forward-looking statements under federal securities laws. Forward-looking statements are identified by words such as will, be, intend, believe, expect, anticipate, or other comparable words and phrases. Statements that are not historical facts, such as statements about expected financial performance, are also forward-looking statements. Actual results may differ materially from those contemplated by such forward-looking statements. A discussion of the factors that could cause a material difference in our results compared to these forward-looking statements is contained in our SEC filings. Please note that on today's call, we will be referring to non-GAAP measures. You can find the reconciliation of these historical non-GAAP measures to the most directly comparable GAAP measures in our third quarter earnings release and our earnings supplement, both of which can be found on the investor relations section of our website and in the form 8K we filed with the SEC. With that, I will turn the call over to Michael Seaton, our President and Chief Executive Officer.

Thank you, Drew, and good morning to everyone joining us today. As we reflect on the third quarter, I am pleased to report positive results that continue to exemplify the resilience and strength of Cielo Realty Trust's investing platform. Our steadfast commitment to pursuing prudent, accretive growth has consistently yielded meaningful results for our shareholders, reinforcing the value of our strategic, long-term approach to building our company. During the quarter, we made significant strides to further expand our net lease healthcare real estate portfolio by making several key investments in lower cost patient settings. Our $16.3 million acquisition of the Southlake portfolio comprised of a medical outpatient building and an adjacent ambulatory surgery center operate symbiotically and demonstrate the type of necessity driven healthcare real estate that is central to our investment thesis. These buildings are anchored by investment-grade affiliated tenancy and benefit from strong operational synergies and are strategically located in South Lake, Texas, an affluent suburb of Dallas. The overlapping physicians, who are uniquely aligned in their ownership of the ASC tenant, seamlessly transition from providing patient consultations in the MOB to surgical procedures in the ASC. Furthermore, the ownership affiliation with and proximity to Baylor Scott & White Medical Center enhanced the overall tenancy, acting as a referral network for strong patient volumes. In addition to the Southlake acquisitions, during the quarter we closed on the $70.5 million Reunion Novus portfolio. which is comprised of two newly constructed state-of-the-art inpatient rehabilitation facilities located in Plano, Texas and Peoria, Arizona. These purpose-built facilities operated by an experienced and well-regarded partner in Novus Rehabilitation Partners serve two of the fastest-growing markets in the United States. Both the Southlake and Reunion Novus transactions, which total approximately $87 million, demonstrate our laser focus on acquiring best-in-class net lease healthcare assets in markets with strong and growing demographics. In addition to the achievements on the acquisition front during the quarter, we have had success at sourcing opportunities to deploy capital at attractive yields to serve our existing tenancy. In the first example, PAM Health entered into an amended lease in May for a facility which we own in San Antonio, Texas, whereby CELA is providing approximately $5 million of capital at an attractive yield for the property's redevelopment as a 34-bed inpatient rehabilitation facility. The commencement of operations at this location is anticipated for December 2025. Please note that PAM Health has been paying full rent to CELA as it has anticipated repositioning the facility to better serve the San Antonio marketplace. Base rent will increase to reflect CELA's additional capital deployment upon commencement of operations, and CELA will also enjoy the benefit from a new 20-year triple net lease term. As another example, we have made significant strides at our Dover Healthcare facility, located in Dover, Delaware, which is tenanted by a joint venture between Bay Health and PAM Health. CELA purchased the facility in April 2025 for $24.1 million. During the third quarter, we acquired adjacent land to the facility to support an approximately $12.5 million expansion of the building, which we expect to be completed by the end of 2026. CELA expects to generate a highly attractive yield on the deployment of its capital to expand the facility and benefit from a new 20-year triple net lease term which commences upon completion of the expansion. This development will add nearly 13,000 square feet and up to 12 new beds to the facility, a much needed increase to serve the high demand of the patient population in Dover, Delaware. As a final example, we expect to have a similar expansion in capital deployment opportunity at our PAM Health and University of Kansas IRF in Overland Park, Kansas. which is anticipated to cost approximately $16 million. This expansion will add two additional floors and 17 new beds, which we expect to commence and be completed in 2026. Collectively, the opportunities which I just mentioned, along with others that we have in the pipeline, are our concerted response to the ongoing demand for high-quality healthcare services in the markets in which we operate, These expansion opportunities underscore our consistent ability to enhance value for CLS shareholders, generating cash yields on our incremental capital deployment of typically 150 basis points or better beyond our acquisition cash cap rates. Real estate ownership often presents opportunities to provide capital to a captive audience, our existing tenants. Utilizing our existing portfolio, these opportunities that I mentioned along with more to come, lend support to our thesis of continuing to externally grow the company through acquisitions of highly utilized healthcare real estate. Our pipeline for acquisitions remains strong, with an approximately $43 million opportunity that has been awarded to CELA and is anticipated to close in early 2026, subject to our customary due diligence process. We have a strong acquisition opportunity set as we head into 2026 and expect a similar level of acquisition volume next year as we have accomplished so far this year. We do expect our targeted cap rate to tighten somewhat due to anticipated looser central bank monetary policy. As I have stated repeatedly, we are committed to growing thoughtfully, strategically, and accretively. Turning to leasing activity. we have successfully renewed 90% of our 2025 lease expirations. In the third quarter, we executed three lease renewals, which accounted for approximately 58,000 square feet, or 1% of portfolio ABR. Following the close of the quarter, we experienced an unanticipated tenant departure at our Alexandria Healthcare facility located in Alexandria, Louisiana. whereby a tenant with whom we had a lease out for signature to renew decided to vacate. This tenant represents 15,600 square feet or approximately 0.3% of total portfolio square feet and ABR. The tenant paid full rent and holdover rent between its stated lease expiration of July 31, 2025 and through and including October. In additional leasing news, We are pleased to report that despite having approximately three years left on a lease with Community Health Systems, or CHS, at our Fayetteville healthcare facility in Fayetteville, Arkansas, we are agreeing to terminate our lease early with CHS, receiving a termination payment, and anticipate simultaneously executing a new lease with Washington Regional Medical Center Best in Class Regional Hospital System. Washington Regional will assume the entire facility under a new lease agreement for 17 and a half years, and we expect this transition to take place in December 2025. This strategic transition from CHS to Washington Regional will move CHS from being our third largest tenant to our sixth largest tenant. I would like to take a moment to remind everyone what CELA's differentiated proposition brings to its shareholders. CELA distinguishes itself from many peers through its integrated focus on healthcare assets and a long-term net-lease structure, which we believe yields better long-term outcomes for shareholders. The non-discretionary nature of healthcare spending has been demonstrated to show durability and resilience across market cycles. Our thesis around triple net lease structures is critical to achieving the best outcomes for our shareholders over time as property operating expenses are passed through to tenants, mitigating the high cost of day-to-day ownership of real estate. Our longer duration lease terms should result in reduced retenanting capital expenses, namely tenant improvement allowances and lease commissions relative to peers with shorter term lease agreements. We are confident that our distinctive and disciplined approach, supported by our robust balance sheet and available liquidity, position us to be able to sustain positive momentum and deliver value to our shareholders. At this time, I will turn the call over to Kay to provide further insight into our financial performance.