Veris Residential, Inc.

Good morning and welcome to the Veris Residential Inc. fourth quarter 2022 earnings conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing star then zero on your telephone keypad. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then 1 on your telephone keypad. To withdraw your question, please press star then 2. Please note this event is being recorded. I would now like to turn the conference over to Taryn Fielder, General Counsel. Please go ahead.

Good morning, everyone, and welcome to the Veris Residential fourth quarter 2022 earnings conference call. 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 laws. 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 in the SEC for risk factors that impact the company. With that, I would like to hand the call over to Mabad Nia, Veris Residential's Chief Executive Officer. Mabad?

Thank you, Taryn. Good morning, and welcome to our fourth quarter 2022 earnings call. I'm joined today by our CFO, Amanda Lombard. Before I turn to our financial results, I'd like to take a moment to acknowledge the tremendous progress our team made during 2022 on our path to becoming a pure-play multifamily company. Despite the significant market volatility and resulting slowdown in transaction activity, we successfully executed on $1.4 billion of non-strategic asset sales, $925 million of which has closed since the beginning of 2022, significantly reducing our office exposure and fully exiting the hotel segment. We also completed and stabilized our newest ground-up multifamily development, House 25, and completed the acquisition of the James, together adding almost 1,000 units to our portfolio, reflecting approximately 15% growth for the second consecutive year. As a result, we increased the share of our multifamily business from 56% of NOI at the beginning of 2022 to approximately 98% by year-end, pro forma for sales under binding contract and the stabilized NOI from House 25, net of concessions that we expect to burn off during the next 12 months. This progress has also allowed us to further strengthen our balance sheet, reducing net indebtedness by nearly $570 million. Amanda will discuss this further. Our 6,931-unit operating multifamily portfolio and our 5,825-unit same-store operating portfolio were 95.3% and 95.5% occupied, respectively, as of December 31st. This is consistent with our strategy of optimizing rents and growing NOI during the year. We continue to capture upside in our portfolio and have seen sustained growth of headline rents with loss to lease reducing to below 2% at the end of the quarter. The same store portfolio achieved a blended net rental growth rate of 17% for the year and 11.7% for the fourth quarter. Our key markets of New Jersey and Boston achieved above-average market rental growth compared to the national average during 2022. Market rents across the Class A multifamily segment in Jersey City grew by 8% during 2022. By contrast, rents in our portfolio significantly outperformed the market, growing by over 15%, reflecting the high quality of our properties and strength of our operational platform. This was despite record new deliveries in the Jersey City market last year of almost 2,000 new units, three times the historic average. However, near-term supply is limited with a mere 500 units expected to be delivered over the next 18 months, while demand remains robust. Four-year same-store NOI increased by 20.1% compared to 2021, driven by higher revenues and slightly lower controllable expenses, despite significant and ongoing inflationary pressures. Turning to 2023, we've seen an increase in occupancy at the beginning of the year, following a typically slower December driven by seasonal trends. Our same-store portfolio, which going forward will include the Upton, Capstone, and Riverhouse Mine, was 96% occupied as of February 14th, with a blended net rental growth rate of 11% recorded since the beginning of this year. As previously noted, House 25, our 750-unit apartment tower in Jersey City, which commenced leasing in April, was 95% leased as of February 3rd, well ahead of schedule and underwritten rents, demonstrating the strong demand for this property, consistent with that seen across our premium Class A multifamily portfolio. Achieving this milestone is a testament to Verish Residential's experienced leasing and marketing teams, as well as our investment in environmentally friendly design features and responsible living concepts that meet the lifestyle preferences of residents. During 2022, we closed on over $800 million of sales, including two waterfront office properties, 111 River Street and 101 Hudson Street, a number of non-strategic land parcels, and the Hyatt Hotel. Earlier this month, we also completed the sale of the Port Imperial Hotel for $97 million, releasing approximately $13 million in equity and removing a $14 million corporate guarantee. An additional $437 million of office properties are under binding contract, the proceeds from which upon closing are expected to provide the company with increased liquidity and valuable optionality in the year ahead. Furthermore, with our exit from the hotel segment complete, we'll be only two office properties away from becoming a pure play multifamily REIT once these transactions close. These remaining non-strategic properties are unlevered, and as such, are expected to release significant equity upon their sale. Since launching Embrace by Veris Residential, our formal approach to environmental, social, and governance initiatives just over a year ago, we have significantly enhanced our company's efforts to support properties, people, and the planet, and are continuing to fulfill our stated commitments of creating communities with purpose, valuing diversity, equity, and inclusion, and implementing sustainable best practices. all through an approach that seeks to prioritize the creation of value for shareholders. Most recently, Veris Residential was named a member of the 2023 Bloomberg Gender Equality Index, a modified market capitalization-weighted index developed to gauge the performance of public companies dedicated to reporting gender-related data. We also joined Pledge 1%, a global movement to inspire, educate, and empower companies to leverage their resources for positive social impact. and formed a strategic partnership with the MIT Center for Real Estate, one of the world's foremost institutes for the study of real estate and technology, to jointly explore innovative solutions that will help our industry effectively and efficiently evolve for the future. During the past two years, we have successfully reduced complexity across the company, strengthened and simplified the balance sheet, and streamlined and enhanced the operational platform, resulting in a fifth consecutive quarter of sector-leading performance across our multifamily portfolio. We begin 2023 in a strong position and well equipped to weather potential economic challenges that lie ahead as we need the anticipated completion of our transformation and seek to unlock the substantial value created for shareholders. With that, I'm going to hand it over to Amanda, who will update you on our financial performance during the quarter.