Veris Residential, Inc.

Ladies and gentlemen, greetings and welcome to the Veris Residential Inc. Second Quarter 2023 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, Taryn Fielder, General Counsel at Veris Residential. Please go ahead.

Good morning, everyone, and welcome to Veris Residential's second quarter 2023 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 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 and annual and quarterly reports filed with the SEC for risk factors that impact the company. With that, I would like to hand the call over to Mahbub Nia, Veris Residential's Chief Executive Officer, who is joined by Amanda Lombard, Chief Financial Officer. Mahbub?

Thank you, Taryn, and good morning, everyone. The advancements made during this past quarter cement our strategic transformation to a pure-play multifamily REIT. We continue to build on our tremendous momentum, achieving a number of significant milestones, including sale of five additional non-strategic assets, despite an extremely challenging transaction market, and negotiated early redemption of RockPoint's preferred interest in various residential trusts, the reinstatement of our dividend, and continued operational outperformance, achieving 12% blended net rental growth and 22% same-store NOI growth, despite the broader softening of rents across the sector. $360 million of proceeds released from the sale of Harborside 1, 2, and 3 in April provided us with substantial liquidity, allowing us to call Rock Point's preferred interest, which they subsequently deferred for 12 months. Since then, we have signed binding agreements for the sale of four additional non-strategic land plots, 107 Morgan Street, Harborside 4, and 2 and 3 Campus for $142 million, as well as Harborside 6 for $46 million. alongside 23 Main Street, which also remains under contract for $17 million. Together, these transactions enable us to fund an early negotiated redemption of Rock Point's preferred interest for $520 million, which we closed on earlier this week, utilizing a new revolving credit facility and term loan as a bridge, which Amanda will discuss in greater detail. The early negotiated redemption of Rock Point removes the uncertainty associated with the redemption process under the joint venture agreement, substantially simplifies the company's overall structure while maximizing our strategic and operational flexibility moving forward. It is also accretive, including a saving of $24 million in annual interest while paving the way for additional expense optimization in 2024. With these latest accomplishments, the Board of Directors has made the decision to reinstate the payment of an ordinary quarterly dividend beginning in the third quarter on a limited basis of five cents per common share, with potential to raise the ASFO payout ratio over time. Looking more closely at multifamily operations, our highly monetized Class A portfolio continues to perform exceptionally well, reflecting the strength of our platform, enhancements we have introduced over the last two years, and the dedication of our team. Despite national Class A net effect of rent growth turning negative across the sector for the first time since the end of 2020, rental growth in our properties increased by 12%, up from 11% in the first quarter, while same-store occupancy remained stable at 95.6%. We remain cautious, however, having recently seen some evidence of a cool-down in rental rates as we lapped high-growth months from last year and entered the typically slower leasing season. Our Class A portfolio continues to command the highest rents in the sector, achieving a 50% premium to our peers, a gap that we've seen widened by approximately 10% since mid-2022. Our average revenue per home increased to $3,734 this quarter, up nearly 17% as compared to the same period last year. Despite this increase in rents, our rent-to-income ratio remained around 15% based on average per unit income, which is about $300,000 per household. The Jersey City and Port Imperial submarkets, which benefit from their proximity to New York City, continue to outperform and demand significantly outpaced supply. Indeed, rents in these markets remain over 30% below those in Manhattan and over 20% below those in downtown Brooklyn, while offering more space and a wider range of amenities. This sustained revenue growth, coupled with our continued focus on expense management, contributed to a 22% growth in same-store NOI compared to the second quarter of 2022. As such, we have raised our NOI guidance for the year to 10 to 12%. We recently published our 2022 ESG report, detailing the meaningful steps we've taken to fulfill our commitment to creating communities with purpose. In fact, a recent survey in which 1,300 residents responded, 20% indicated that our ESG credentials were a significant factor in their decision to lease with various residential. We've reduced our energy consumption by 24% over three years and have exceeded our SBTI validated goal. well ahead of the 2030 target date. Additionally, House 25 recently achieved its anticipated lead silver certification, increasing the percentage of our portfolio that is green certified to nearly 70%. During the quarter, we also advanced a number of social initiatives, recently announcing that various residentials become the first company globally to achieve the well equity rating portfolio-wide. This rating provides a framework for us to act on our diversity, equity, and inclusion and accessibility goals, as well as improve company culture and employee health, all while continuing to create long-term shareholder value. Since the reconstitution of our board three years ago, we've executed over $2 million of non-strategic asset sales, despite extremely challenging market conditions. These included 31 office properties, three hotels, and 11 land parcels. while completing four new developments and adding nearly 2,000 units to our multifamily portfolio, resulting in 30% unit growth. We also successfully rebranded to various residential and enhanced our operational capabilities as reflected in our continued sector-leading performance. These achievements are a testament to the hard work and dedication of our incredible team, who I would like to thank for their tireless efforts. Looking ahead, we'll focus our efforts on closing the assets on the contract, repaying the term loan, and continue to enhance operational platform while working closely with the Board of Directors to identify further opportunities to maximize value for our shareholders. With that, I'm going to hand it over to Amanda, who will provide an update on our financial performance during the quarter.