European Residential Real Estate Investment Trust

Good morning, ladies and gentlemen. Welcome to the European Residential Real Estate Investment Trust second quarter 2024 conference call. My name is Jaquita. I will be your moderator for today's call. All lines will be muted in the presentation portion of the call with the opportunity for questions and answers at the end. If you would like to ask a question, please press star one on your telephone keypad. I would now like to pass the conference over to your host, Nicole Dolan with European Residential Real Estate Trust. Nicole, please go ahead.

Thank you, operator, and good morning, everyone. Before we begin, let me remind everyone that during our conference call this morning, we may include forward-looking statements about expected future events and the financial and operating results of ERAS, which are subject to certain risks and uncertainties. We direct your attention to slide two and our other regulatory filings for important information about these statements. I will now turn the call over to Mark Kenney, Chief Executive Officer.

Thanks, Nicole, and good morning, everyone. Joining me this morning is Jenny Chow, our Chief Financial Officer, and Karim Farooq, our Managing Director. We'll get started on slide four. Residential occupancies were high at 97.7% at period end. However, this is down slightly versus the first quarter as a result of our optimization program which continues to drive the majority of our vacancy. Occupied average rent for the residential portfolio was 1,072 euro per month on June 30th, representing an increase of 6.2% compared to June 30th, 2023. This remains above our target range of 3 to 5%, reflecting the continued strength of the Dutch multi-residential market fundamentals, as well as the REIT's ability to navigate the complex an evolutionary regulatory regime in the Netherlands. I will also point out that this rent growth incorporates 2023 indexation of a weighted average 4%. For indexation effective July 1st, 2024, our weighted average increase was 5.6%, and that will positively impact our future operational results. On slide five, you'll see we've been quite active in terms of unlocking value and recycling our capital since the first quarter. We've gained momentum on our suite by suite privatization program. And since Q1, we've disposed of an additional 56 suites for 15.1 million euro in gross proceeds. This is on top of the 24 single suite sales completed in the first quarter. In June, we also closed on the disposition of one 66-suite portfolio for €14.2 million. And a further 464 suites were sold in July for €100.7 million. We're using net proceeds from these strategic sales primarily to pay down debt in order to lower our leverage, reduce our exposure to interest rate risk, and strengthen our balance sheet. On the latter, the fair value of our property portfolio was down overall due to our disposition program, but we did recognize a fair value gain of €11.1 million for Q2, a result of higher forward NOI, as well as a slowly recovering transactional market in the Netherlands. With accretive sales and a slight fair value increase on our stabilized portfolio, Our diluted NAV per unit was up modestly to 2.94 euro at period end. I will now turn the call over to Jenny to provide an update on our financial performance.