Stag Industrial, Inc.

Greetings and welcome to the Stagg Industrial Second Quarter 2020 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief 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. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Matts Pinard, Senior Vice President, Investor Relations. Thank you, sir. You may begin.

Thank you. Welcome to SAG Industrial's conference call covering the second quarter 2020 results. In addition to the press release distributed yesterday, we have posted an unaudited quarterly supplemental information presentation on the company's website at stagindustrial.com under the investor relations section. On today's call, the company's prepared remarks and answers to your questions will contain follow-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements address matters that are subject to risks and uncertainties that may cause actual results to differ from those discussed today. Examples of forward-looking statements include statements relating to earnings trends, G&A amounts, acquisition and disposition volumes, retention rates, debt capacity, dividend rates, industry and economic trends, and other matters. We encourage all of our listeners to review the more detailed discussion related to these forward-looking statements contained in the company's filings. As you've seen, the definitions and reconciliations and non-GAAP measures contain the supplemental informational package, which is available on the company's website. As a reminder, forward-looking statements represent Anderson's Estimates as of today. SAG Industrial assumes no obligation to update any forward-looking statements. On today's call, you will hear from Ben Butcher, our Chief Executive Officer, and Bill Crooker, our Chief Financial Officer. I will now turn the call over to Matt.

Thank you, Matts. Good morning, everybody, and welcome to the second quarter earnings call for SAG Industrial. We are pleased to have you join us and look forward to telling you about our second quarter results. Presenting today, in addition to myself, will be Bill Crooker, our chief financial officer, who will discuss the bulk of the financial and operational data. Also with me today are Steve Mechie, our chief operating officer, and Dave King, our director of real estate operations. will be available to answer questions specific to their areas of focus. As we enter the month of August, there continue to be more questions than concrete answers around important items that impact all of our daily lives. Will there be a second wave of COVID-19? If so, how will this impact reopening of our economy? Will students return to the classroom or be educated virtually? Will employees return to the office or continue to work from home? On top of these unanswered questions, we have the upcoming presidential election in November. and many more. Not surprisingly in this environment, Amazon continues to be our largest tenant. This dominant e-commerce company now accounts for 2.5% of our annualized base revenue. This includes the recent leasing activity we have specifically discussed in conference calls and at conferences. Across our platform, we continue to see the build-out of e-commerce supply chain as a large and growing demand driver for industrial real estate. Let me now go over the leasing status for the four buildings that have been highlighted in our recent communications. Our building in Hampstead, Maryland, a 1 million square foot building to be vacated by Solo Cup in July, has seen a healthy amount of leasing activity over the past two months. Our initial expectation was that it would take 12 to 18 months to accomplish the release of this building. Based on current information, we expect to outperform that estimate. Our value-add project in Taunton, Massachusetts, a 350,000 square foot building, was acquired last year subject to a short-term lease to a known vacate tenant. The building receives strong leasing interest from a variety of tenants, mostly for e-commerce use. We are happy to report that we have signed an 11-year lease to a dominant e-commerce tenant for the full building. In addition, we received a termination fee of over half a million dollars from the vacating tenant. The resulting zero downtime and the achieved rent significantly outperformed our budget and expectations for these metrics. Our speculative development in Burlington, New Jersey, a 250,000 square foot building that sits in one of the strongest strategic distribution markets on the East Coast, exit 6A of the New Jersey turnpike. We are happy to confirm that we have executed a full billing lease to a dominant e-commerce tenant, again outperforming our expectations on both rent and lease uptime. Finally, we have determined the optimal path forward for our other building in Burlington, New Jersey, the 1 million square foot building that GSA will vacate in December. You may recall this asset also includes 40 acres of land adjacent to the building with development potential of over 500,000 square feet. After evaluating multiple potential paths, we will be moving forward to release the existing building and to separately continue to pursue permitting of the development parcel. This decision was driven by the continued strong leasing velocity in the Exit 6A submarket. This strength has been evidenced by the multiple discussions we are having with potential full building users. We look forward to updating everybody with details on both components in the near future. In short, on these assets and across the portfolio, some very solid performance by our experienced and capable asset management team. With that, I'll turn it over to Bill who will discuss our second quarter operational results and updates to our 2020 guidance.