SmartCentres Real Estate Investment Trust

Good day, ladies and gentlemen. Welcome to the Smart Center's ReadQ3 2023 conference call. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question again, press star one. I would like to introduce Mr. Peter Swann. Please go ahead, sir.

Thank you, Operator, and good morning, everyone, and welcome to our third quarter 2023 results call. I'm Peter Slan, Chief Financial Officer. I'm joined on today's call by Mitch Goldhar, SmartCenter's Executive Chair and CEO, and by Rudy Gobin, our Executive Vice President of Portfolio Management and Investments. We will begin today's call with some comments from Mitch. Rudy will then cover some operational items, and I will review our financial results. We would then be pleased to take your questions. Just before I turn the call over to Mitch, I would like to refer you specifically to the cautionary language about forward-looking information, which can be found at the front of our MD&A materials. This also applies to comments any of the speakers make today. Mitch, over to you.

Thank you, Jim. Good morning and welcome, everyone. Apologies for the time. I thought we might want to get an early start to our and your days today. As they say, Time waits for no one, and 2023 continues to move full steam ahead. I made a challenging market with economic headwinds. That being said, one thing you can continue counting on is the stability and cash generation of a portfolio that was built for headwinds and heavy weather. At 100 Walmart strong smart centers, value-oriented, portfolio continues to demonstrate why there is no substitute for well-located dominant centers built in the midst of residential communities. Existing new retailers continue to demand more space, building on the momentum of the first half of this year, with the portfolio achieving 98.5% out of the by the end of the quarter. Extensions, extension rates are up 2.3%. Chained property NOI for the three months ended to quarter higher at near 2% compared to the same period in 2022. Collections remain above 99% as demand from retailers for smart centers is strong with their improved in-store offerings, experience, as well as their omnichannel platforms. And our retailers are well capitalized for modernization and expansion. In fact, we are signing deals for new build retailers, which Rudy will speak to shortly. Toronto and Montreal premium outlets remains fully leased. With 12-month rolling sales continuing to set records, moving 2023 EBITDA to record levels. Well-priced luxury brands continue to be in high demand and in fashion, if you will, with consumers being bussed in from longer distances. Take advantage of the great mix of designer brands. Toronto Premium Outlets is now in the top three best sales performers in Canada, and traffic continues to grow. Built on this stable and growing cash-generating platform, we continue to develop on the significant and varied mixed-use permissions already in place. Currently under construction, we have condos, apartments, industrial, self-storage, townhouses, and retirement in the GTA, Ottawa, and Montreal areas. In the quarter groundbreaking commence, on phase one of our Art Walk project comprising 320 sold-out units right here in the VMC. We also commenced construction of over 300,000 square feet of self-storage and 200,000 square feet of retail with details listed in our MD&A. On land use permissions, this quarter alone, we successfully achieved residential rezonings for 4.5 million square feet in Ontario and Quebec combined, bringing our year-to-date total to over 7.7 million square feet. We will continue to stay focused on obtaining these permissions, which is no small task, while simultaneously getting ready to launch future residential phases when appropriate in the appropriate markets and only with full funding in place. Recall that in 2022, we achieved over 6.1 million square feet of new mixed-use permissions in urban locations with high demand for housing. So 2023 is already exceeding our 2022 permissions, and we have no indication of slowing down. Given that development is our long-term vision and strategy, we are committed on unlocking the tremendous value embedded in the land we already own, which as a reminder, sits in the midst of highly populated communities in nearly every major market in Canada. While you can read the details of many of our developments planned for the portfolio on MDMA, here are a few quick highlights of which are currently underway. Construction of the fourth and five transit city condo towers at SmartVMC, comprise 45 and 50 stories respectively, is wrapping up with 274 units closing in the quarter, generating $6.9 million in profits, which Peter will speak to more in a moment. Two, also within SmartVMC, the Millway, our 36-story apartment building, is nearing completion with 67% available finished units already leased we expect the last remaining bunch match 127 of unfinished units to be completed by year end and demand and demand remains strong given the housing supply and current interest rate environment three our apartments in mascouche suburb of montreal which opened in Q3 2022, continues to show improved leasing and stands at 83% leased. Four, our second tower in the center of Lavelle was completed in Q3 of this year, opened July 1st, and is already 82% occupied, with the first tower at 99% occupancy. Five, construction of our first industrial new build A 229,000 square foot, 40-foot clear building on 16 acres of a 38-acre site on Highway 7 in Pickering was completed in the quarter, with half of the space having been turned over to a tenant, and the leasing interest on the remaining space remains strong. Construction number six, construction of a new senior's residential and apartment building totaling 402 units in Ottawa Laurentian, which was temporary delayed has now resumed with a revised completion expected in early 2025. Having completed earthworks and site servicing last quarter, and with our two partners, construction is moving along quickly on our 174 unit Vaughan Northwest townhouse project with the closings planned for the second half of 2024. Eight, for our self-storage portfolio, we announced last quarter that we achieved a milestone of 1 million square feet built space with our partner, SmartStone. During this quarter, we commenced construction of two additional facilities in Toronto and Stony Creek for a combined 300,000 square feet. Nine, lastly, we are continuing discussions with potential buyers and new partners and selected assets within the portfolio, which will assist in funding development, debt reduction, and diversification. With only a small part of the portfolio, we see this as an ongoing capital recycling program, which will not only strengthen our balance sheet, but de-risk future cash flow streams. You can see this current construction activity is in our expanded disclosure in the MD&A as well as the list of the additional projects scheduled to commence construction in the next two years. Well, I've only just resumed a limited number of projects and delayed a few others, owing to current market conditions. Our efforts in obtaining additional residential land use permissions continues in the normal course, which enhances value in our land. We will, as always, remain diligent in curing any risk hurdles before moving forward with any project, which I will remind you lies within the underutilized lands we already own. On the financial side, Peter will provide a full update in a minute, but let me emphasize a couple of pertinent items. Maintaining a conservative balance sheet remains a significant priority for us, along with maintaining a significant uncumbered pool of assets, which now stands at over $8 billion. Our debt level has reduced slightly to 43%. Liquidity remains in excess of $800 million. And we will continue to enhance this portfolio with the same degree of care and attention to detail, as always, and with the tremendous support we continue to receive from our lenders and partners, who we greatly appreciate. On a final note, many thanks and appreciation to our great team of associates, partners, contractors, and of course our tenants for your commitment and dedication in helping us deliver on this long-term vision. And with that, I will turn the call over to Rudy.