Veris Residential, Inc.

Good day everyone and welcome to the VAERS residential fourth quarter 2021 earnings conference call. Today's call is being recorded. I would like to remind everyone that certain information discussed on this call may constitute forward-looking statements within the meaning of the federal securities law. Although we believe the estimates reflected in these statements are based on reasonable assumptions, we cannot give assurance that the anticipated results will be achieved. We refer you to the company's press release annual and quarterly reports filed with the SEC for risk factors that impact the company. With that, I will now hand the call over to Mavadnia, Vice President, I'm sorry, Veris Residential Chief Executive Officer. Please go ahead.

Good morning, and welcome to our fourth quarter 2021 earnings call.

I'm pleased to be joined by Amanda Lombard, our Chief Accounting Officer, who I would like to welcome to the team. Amanda will be assuming the role of Chief Financial Officer on April 1st, taking over from David Santana, who I would like to thank for his unwavering commitment and contributions to the company during the past four years. 2021 was a transformative year for our company as we made significant progress in simplifying and refocusing the portfolio. strengthening our balance sheet, and further enhancing our multifamily operational platform. We continue to execute on initiatives aligned with our strategic objective of being an environmentally and socially conscious, transparent, and forward-thinking pure play multifamily REIT, as evidenced by our renewed ethos and corporate values as Veris Residential, which began with the reconstitution of our board in the summer of 2020. We enter 2022 from a position of strength with a number of non-strategic asset sales that we anticipate will generate significant additional liquidity and provide even more optionality for the company throughout the course of the year. The operating fundamentals across our 6,691-unit multifamily portfolio once again showed strong momentum during the quarter. The portfolio was 96.6% occupied as of year-end, ahead of pre-pandemic levels. During the past year, we tapered concessions and realized the rental growth rate for new leases at 13.9% and renewal leases at 11.6% on a net basis during the fourth quarter. The same store 5,499 unit operating portfolio was 96.4% occupied as of year end, up from 86.9% in December 2020 and 2.8% above pre-pandemic levels. driving sequential same-store revenue and net operating income growth of 3.4% and 7% respectively. During 2021, we launched three lease-up properties comprised of 866 units, all of which stabilized during the year, well ahead of our internal expectations for leasing velocity and rent levels achieved. In fact, by year-end, occupancy at the Capstone and Port Imperial, which received LEED Silver certification in early 2022, and the Upton and Short Hills both exceeded 99%. In a further step to continue strengthening our operational platform, we made a decision to terminate our third-party management activities effective December 31st, 2021. This will free up valuable resources that we will allocate to managing our own assets, including House 25. We believe our Class A multifamily portfolio that offers unique living environments that align with our residents' lifestyles and values is poised to continue to benefit from a favorable macroeconomic backdrop, including continued job and wage growth, declining home purchase affordability, and the anticipation of a wider return to office. Turning to our dispositions, since commencing our suburban office disposition program at the end of 2019, we've completed over $1 billion of sales across 36 assets. including approximately $741 million sold during 2021. Proceeds generated from these sales were used to repay corporate bonds, reduce overall indebtedness, and further strengthen our balance sheet. In January 2022, we completed the disposal of 111 River Street in Hoboken for $210 million and have another office property in Jersey City currently under contract for $380 million. As a result, our multifamily portfolio represented 56% of our net operating income at the end of 2021, up from 38% in the prior year. We expect this level to rise to around 71% when adjusted for the aforementioned office sales and a four-quarters contribution from recently stabilized lease-up properties, all else held constant. Additionally, to further simplify the business and recycle capital, we progressed in monetizing select land parcels. We currently have six land parcels with a total value of $155 million under binding contracts. As we look to our office portfolio, the waterfront assets were 72% leased at year end. During the course of 2021, we signed 181,500 square feet of leases, comprised of 85,500 square feet of new leases and 96,000 square feet of lease renewals and expansions. January 2022, We executed a new 15-year, 130,400-square-foot lease with Collectors Universe at Harborside 3. Collectors Universe will replace MUFG, who were not in occupation of their full space. We negotiated the surrender of 100,300 square feet of their lease with a corresponding early termination fee to facilitate this new lease. The new lease with Collectors Universe is value-enhancing as it captures an increase in term to 16.5 years, up from eight years, with a rent per square foot of just under $42, while improving the occupancy and overall weighted average lease term at the property. While the pace of return to office remains subdued during the fourth quarter due to Omicron, we anticipate a more widespread return to office during 2022. We continue to believe that Harborside's live, work, play proposition, coupled with the incentives offered through Jersey City's Emerge program, will appeal to a wide cross-section of office tenants as validated by the recently executed Collector's Universe lease. As noted earlier, various residential is much more than a name change. It is a culmination of our efforts over the past 18 months to weave environmental and social considerations into the fabric of the company. Considerations that will inform our future decision-making as we seek to continue to maximize long-term shareholder value as a responsible and transparent company. To that end, we have already made significant progress on reducing the environmental impact of our portfolio and operations and strengthening our commitment to diversity through our endorsement of global initiatives, including the CEO Action for Diversity and Inclusion Pledge, the UN Women's Empowerment Principles, and the Climate Group's EV100 initiative. In fact, we are pleased to report that we were the first real estate company in the U.S. to become a member of EV100, joining a diverse group of blue-chip institutions, and have committed to rolling out electric vehicle charging points across our properties by 2030. Furthermore, as of year end, 25% of our wholly owned multifamily properties were LEED certified, and 100% of them received the WELL health and safety certification in the fourth quarter, demonstrating our commitment to the environment, as well as the health and well-being of our employees and residents. Overall, 2021 marked a year of tremendous progress for our company, with strong operating results and a number of strategic milestones achieved. We're excited for what lies ahead and remain well-positioned to continue executing on our transformation plan during 2022. With that, I'm going to hand it over to Amanda, who will update you on our financial performance during the quarter.