Stag Industrial, Inc.

Good morning, and thank you for standing by. Welcome to Stagg Industrial, Inc.'s third quarter 2020 earnings conference call. At this time, all participants are in listen-only mode. A question-and-answer session will follow the formal presentation. Should you require operator assistance during the conference, please press star zero to signal an operator. Please note this conference is being recorded. I will now turn the conference over to your host, Matts Pinard, Senior Vice President, Investor Relations for Stagg Industrial. Thank you. You may begin. Thank you.

Welcome to STAG Industrial's conference call covering the third quarter 2020 results. In addition to the press release distributed yesterday, we have posted an unauded quarterly supplemental information presentation to 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 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. Examples of forward-looking statements include forecasts of core FFO, same-store NOIs, G&A, acquisition and disposition volume, retention rates and other guidance, leasing prospects, rent collections, industry and economic trends and other matters. We encourage our listeners to review the more detailed discussion related to these forward-looking statements contained in the company's filings with the SEC and the definitions and reconciliations and non-GAAP measures contained and a supplemental informational package available on the company's website. As a reminder, forward-looking statements represent management's estimates as of today. Stagg Industrial assumes no obligation to update any forward-looking statements. On today's call, you'll hear from Ben Butcher, our Chief Executive Officer, and Bill Crooker, our Chief Financial Officer. I will now turn the call over to Ben.

Thank you, Matts. Good morning, everybody, and welcome to the third quarter earnings call for Stagg Industrial. We're pleased to have you join us and look forward to telling you about our third 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. They will be available to answer questions specific to their areas of focus. A phrase that I've heard frequently over the past few months has been, it's good to be an industrial, and that is certainly true. Industrial remains one of the few favored asset classes in commercial real estate. Fundamentals are strong. Tenant leasing demand slowed only briefly at the outset of the pandemic. It resumed quickly and has continued to be strong throughout the quarter. This resilience has been seen across virtually all markets with e-commerce supply chain build-out leaving the way. Supply remains a concern, but most markets are at or near equilibrium and are operating at occupancy levels where the levels of incremental supply are not unwelcome. Capital is readily available and acquisition opportunities abound. Not surprisingly, our portfolio continues to perform well despite somewhat uncertain economic conditions. The demand for our space is broad-based. The 5.6 million square feet leased in the third quarter represents the largest total square footage leased during a single quarter in Stagg's history. Our occupancy level remains high, 96.3% at quarter end, a reflection of solid retention and shorter downtime experience. Included in this quarter's leasing activity was the successful backfill of our 1 million square foot building located in Hampstead, Maryland, one of the 2 million square foot facilities with tenant nominal expected to occur in 2020. We budgeted between 12 and 18 months of downtime prior to re-tenanting this facility, given its size and location. Thanks to the efforts of our asset management team, we significantly outperformed our budget and successfully released the building to a single user while incurring no downtime. The building is leased to a substantial credit for over five years with minimal tenant improvement work and 3% annual rental escalators. The second 1 million square foot building we've discussed is our GSA building located at Exit 6A of the Jersey Turnpike in Burlington, New Jersey. This is one of the premier submarkets on the East Coast and a version of e-commerce hub. Our current budgets reflect a midpoint of nine months downtime for this asset. We continue to receive interest from both potential buyers and potential users for this building. and it's included 500,000 square foot potential additional development. Our guidance assumes we hold this asset for the foreseeable future. However, given the attractive returns of a potential sale, we believe there is an increased likelihood that we monetize this asset. As expected, the acquisition market has returned to pre-pandemic levels, both in terms of investment opportunity and pricing. The fundamental strength of the industrial real estate sector going forward has not been lost on investors. As a result, investor appetite for industrial real estate continues to grow. However, our acquisition platform is well established across many markets in which we operate. Our ability to identify relative value investment opportunities is reflected in our acquisition pipeline amount of over $2.8 billion today. We recently completed our fourth annual tenant survey. Not surprisingly, there are more and less fortunate industries during the pandemic. The more fortunate include third-party logistics providers and the home improvement industry, and of course, anything e-commerce related. Less fortunate include tenants in the trade show industry and certain small automobile tenants. E-commerce remains a dominant theme. Approximately 40% of our respondents across our portfolio utilize a portion of their space to conduct e-commerce activity, and approximately 15% of our buildings are solely dedicated to e-commerce. Our tenants reported an increase in the percentage of their warehouse footprint focused on e-commerce activity, an increase from 30% in 2018 to almost 40% in 2020. STAG is in an enviable position as we approach the end of the year. Our balance sheet is defensively positioned and our liquidity is high. The STAG team is working effectively and efficiently in the current work-from-home environment with strong engagement across the organization and a resilient culture. Then I'll turn it over to Bill who will discuss our third quarter operational results and updates to our 2020 guidance.