Allied Properties Real Estate Investment Trust

Hello, ladies and gentlemen, and thank you for standing by. Welcome to Allied Priorities REACH first quarter 2026 earnings conference call. All lines have been placed on mute to prevent any background noise. Thank you. I would now like to turn the conference over to our president and CEO, Cecilia Williams. Please, go ahead.

Thanks, Dustin, and good morning, everyone. Welcome to our Q1 conference call. Please note that certain statements we make during the course of this conference call that are not statements of historical facts may constitute forward-looking information and forward-looking statements about future events or future performance. These statements are based on management's current expectations and are subject to risks, uncertainties, and other factors that may cause actual events or results to differ materially from historical results and or from our forecasts, including those described under the heading Risks and Uncertainties in our 2025 Annual Report. Material assumptions underpinning any forward-looking statements we make include those described under the heading Forward-Looking Statements in our 2025 Annual Report. Certain non-IFRS financial measures may be discussed on this call. References to non-IFRS financial measures are only provided to assist you in understanding our results and performance trends and may not be appropriate for any other purpose. For further discussion on these matters, please refer to our 2025 Annual Report under the heading Non-GAAP Measures. Turning to the quarter. Q1 marks the first full quarter of executing our action plan, and the results reflect progress. Operating performance was in line with our expectations. Leasing momentum is encouraging, as we see improving demand across our core urban markets and a growing pipeline. Our $500 million disposition program is on track, and we completed our equity issuance during the quarter, an important milestone in restoring financial flexibility. This morning, I'll focus on three areas. One, leasing and operating fundamentals. Two, execution of our deleveraging strategy. And three, development and capital allocation. Nan will then review our financial results, and JP will cover leasing in more detail. Starting with leasing and operating fundamentals. We ended the quarter at 87.1% leased and 85.0% occupied. modestly ahead of expectations. Leasing activity in the quarter was solid. We leased over 500,000 square feet with strong contribution from both new users and expansions. We also achieved 63% retention on expiries. More importantly, forward indicators are improving. Our total leasing pipeline increased 20% and our new leasing pipeline increased 36%. This is consistent with what we see across our markets as interest in high quality urban workspace continues to improve and new supply remains limited. Activity is increasingly focused on smaller format space, which aligns well with our portfolio offering. As expected, we continue to expect timing impacts from non-renewals and we expect some softness in Q2. However, Based on current activity levels, we remain confident in our year-end occupancy target of 84% to 86%. Turning to the balance sheet, our priority remains the leveraging and improving credit metrics. We ended the quarter at 12.3 times net debt to EBITDA, an improvement from 12.9 times in the prior quarter. During the quarter, we made progress across all components of the plan, We completed our equity issuance and advanced our disposition program, selling low-yield, non-poor assets to improve our portfolio composition and earnings potential. In Q1, we closed $46 million of dispositions and continued to advance the remaining $450 million pipeline, which is actively marketed and progressing. And I'm pleased to report that after quarter ends, We went firm on additional assets expected to generate $201 million of proceeds in Q2. This gives us confidence in our ability to reach our $500 million disposition target by year end. As we noted last quarter, the timing of asset sales is not entirely within our control, but expanding the pipeline improves execution certainty and flexibility. Our objective remains unchanged. get to mid 11 times net debt to EBITDA by year end, and we're on track to deliver that. Turning to development. We're now at the final stage of our development cycle with King Toronto as the last major project. As expected, this project continues to create near-term volatility. In Q1, we recorded additional expected credit loss and impairment on residential inventory. These reflect higher costs to complete construction delays, and increased uncertainty around condominium closings. We're actively addressing these risks and have taken over onsite construction management and are working toward extending the construction loan. While not preferred, these actions are necessary to protect value and maintain project momentum, consistent with the approach we outlined last quarter. Importantly, the underlying fundamentals of the project remain intact. The project is 92% pre-sold. Commercial leasing is progressing and anchored by Whole Foods. And completion is targeted for the second half of 2027. Turning to our outlook. Our three-year outlook has been updated for one item in 2026. Capital expenditures are expected to be higher in the year by 40 to $50 million due to the higher construction cost to complete King Toronto. All other key metrics over the three-year period remained within previously communicated ranges. As we said last quarter, our outlook assumes gradual occupancy improvement, which we're seeing. It also assumes continued deleveraging, which we're executing on. To conclude, we're at a turning point. With the capital-intensive phase of the business largely behind us, our focus is now on execution. We're leasing space, recycling capital, and strengthening the balance sheet. While risks remain, particularly within development, we're addressing what we can control. Our portfolio is well positioned and the path forward is clear. Q1 demonstrates we're on track and the work we continue to do reflects our focus. With that, I'll turn the call over to Nan.

Thanks, Cecilia. Good morning, everyone. I'll briefly cover our first quarter financial results, our ongoing efforts to strengthen the balance sheet. Q1 performance came in line with expectations. FFO was $0.289 per unit. Rental revenue of $144 million and operating income of $70 million was consistent with our budget. Same as in the Y, the quarter also met expectations. Our leverage ratios were slightly better than expected, debt to EBITDA coming in at 12.3 times. This was mainly due to funding timelines for King Toronto and M4. Turning to valuation, Our Q1 results included $134 million fair value adjustments, $48 million in payment of residential inventory, and a $44 million increase in expected credit loss provisions. During the first quarter, we completed dispositions totaling $46 million. These proceeds were used in conjunction with our equity rate to recoup the balance owing on our 1.7% Series H debentures, which came due in February. Subsequent to the quarter, and We entered into a firm contract to sell eight properties in Toronto for $123 million and one property in Montreal for $78 million. We expect these proceeds to close in the second quarter. We continue to focus on reducing our leverage metrics to maintain our investment credit ratings. Disposing of non-poor low-yielding assets is a key component of our strategy to strengthen the balance sheet. This will reinforce our financial stability and flexibility. In closing, the start to 2026 is largely tracked as expected. I'll now turn the call over to JP. Thank you.