Dream Residential Real Estate Investment Trust

Welcome to the DREAM Residential REIT Fourth Quarter 2024 Results Conference Call on Thursday, February 20, 2025. Please be advised that all participants are currently in listen-only mode and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press star then 1 on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star then zero. During this call, management of Dream Residential REIT may make statements containing forward-looking information within the meaning of applicable securities legislation. Forward-looking information is based on a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond Dream Residential REIT's control that could cause actual results to differ materially from those that are disclosed in or implied by such forward-looking information. Additional information about these assumptions and risks and uncertainties is contained in Dream Residential REIT's filings with securities regulators, including its latest annual information form and MDNA. These filings are also available on Dream Residential REIT's website at www.dreamresidentialreit.ca. Your host for today will be Mr. Brian Pauls, CEO of Dream Residential REIT. Mr. Pauls, please proceed.

Good morning, everyone, and thank you for joining us today for Dream Residential REIT's fourth quarter and year-end 2024 conference call. Speaking with me today are Scott Schuman, our Chief Operating Officer, and Derek Lau, our Chief Financial Officer. The REIT continues to deliver stable operational performance. For Q4 2024, comparative properties NOI growth was 2.4%. For the year, comparative properties NOI growth was 3.7% and within our guidance that we had set at the beginning of 2024. Comparative properties NOI margin was 52.9% compared to 52.1% in the prior year comparative quarter. Top line revenue continues to be impacted by current operating conditions while we focus on managing controllable costs. FFO per unit was 17.3 cents and compares to 17.7 cents in the prior year. We continue to prioritize our balance sheet strength. We ended 2024 with a net total debt to net total assets ratio of 33% and a weighted average term to maturity of 4.8 years on our mortgages. Overall liquidity is approximately $60 million. We completed 196 suite renovations in 2024, which included commencing work in Cincinnati. This is below our initial target as we pivoted toward tenant retention and maintaining occupancy. We have now paused renovations in Oklahoma and will also pause in Dallas. Overall, I'm very pleased with the REIT's operational and financial performance, which has been largely consistent with expectations. There continues to be a disconnect between our trading price and the intrinsic value of Dream Residential's portfolio. With our year-end results, we have announced that the REIT has commenced a strategic review process with a goal to maximize value for our unit holders. We are committed to evaluating and exploring various alternatives to achieve this result. In light of this decision, we will not be providing formal 2025 guidance. I will now turn it over to Scott to provide an operations update for the quarter. Scott?

Thank you, Brian. We are pleased to report a net operating income of $6.3 million for the fourth quarter of 2024 and $24.9 million for the calendar year. This achieves the mid-range of annual guidance and represents comparative property NOI growth of 2.4% for the quarter and 3.7% over the year. Peak supply, economic tension, and winter seasonality have broadly restrained near-term revenue growth. but DRR's active and disciplined spend management practices improved operating margins 100 basis points quarter over quarter and 30 basis points year over year. Our team is pleased with the leadership from our community directors and the resilience from our sustained property performance. Comparative property revenue for the year grew 0.8% higher than Q4 2023 and 3.5% higher than calendar year 2023. DRR portfolio average daily occupancy over calendar year 2024 stabilized even within three basis points of calendar year 2023, finishing at 93.4 percent on December 31, 2024. Average daily occupancy during Q4 improved 24 basis points compared with Q4 2023. DRR's Oklahoma communities led our other markets with 94.4 percent occupancy rate at quarter end and averaged over the trailing 12-month period. Our Oklahoma assets also led in quarter-to-quarter rent growth at 0.8 percent higher than the preceding quarter and matched our Cincinnati region assets with 3.0 percent annual in-place rent growth. Portfolio-wide, rents increased 0.5 percent from Q3 to Q4 and grew 2.2 percent up from $1,156 last year to $1,181 this year. As a frame of reference spanning more than two and a half years since DRR went public, apartment list national rent indices for U.S. multifamily rents have remained flat from May 2022 through December 2024. DRR in-place rents have grown 17 percent over the same period from IPO through the end of Q4 2024. Leasing conditions across the United States are challenged and likely to remain subdued in the near term. During Q4, DRR leases decreased 2.3% on expiry. However, renewal tradeouts rose 4.6% for a blended 1.4% tradeout. We prioritized renewing residents as reflected by Cincinnati's 63% renewal rate and Oklahoma's 58% renewal rate. Dallas-Fort Worth community's renewal rate remained below 50% as the team completed 40 value-add renovation suites to close out the year. We reduced value-add work in 2024, completing 56 suites during Q4 and 196 suites over the year. Net renovation returns improved during the fourth quarter on $99 lease premiums. However, sustained returns trailed our target band of 12% to 16% for the year. As a result, construction paused in Dallas-Fort Worth and Oklahoma City. Value-add work does continue in Cincinnati. Renovation tradeouts on 35 suites in Cincinnati averaged more than $300 and pushed investment returns into the upper portion of our desired target band. The macro pipeline of new apartment deliveries is projected to drop 20% in 2025 and 60% in 2026. DRR assets are exceptionally well positioned for the upcoming shift from high supply to high demand. It is my pleasure to turn things over to Derek Lau, our Chief Financial Officer.