Canadian Net Real Estate Investment Trust

Good morning. I would like to welcome everyone to Canadian NetREIT's 2023 Third Quarter Earnings Conference Call. At this time, all participants are in a listen-only mode. Following the presentation, we will conduct a question-and-answer session, at which time, if you wish to ask a question, you need to press star 11 on your telephone. I would like to advise everyone that this conference is being recorded. I would now like to turn the conference over to Ben Gazif, Canadian NetREIT's Chief Financial Officer. Please go ahead, Mr. Gazif.

Thank you, operator. Good morning, everyone, and thank you for joining us on our Q3 2023 results conference call. Before we begin today, we are obliged to advise you that in talking about our financial and operating performance and in responding to questions today, we may make forward-looking statements, including statements concerning Canadian NETs, objectives and strategies to achieve them, as well as statements with respect to our plans, estimates, and intentions or concerning anticipated future events, results, circumstances, or performance, which are not historical facts. These statements are based on our current expectations and assumptions and are subject to risks and uncertainties that could cause our actual results to differ materially from the conclusions in these forward-looking statements. Additional information on the risks that could impact our actual results and the expectations and assumptions we applied in making these forward-looking statements can be found in CanadianNet's most recent annual information form for the year ended December 31st, 2022, and in management discussion and analysis for the period ended September 30th, 2023, which are available on our website at www.cnetread.com and on CDAR at www.cdar.com. We will also refer to non-IFRS financial measures today, which are widely used in the Canadian real estate industry, including FFO, AFFO, and NOI. CanadianNet believes these financial measures provide useful information to both management and investors in measuring the financial performance and financial condition of CanadianNet. These financial measures do not have any standardized definition prescribed by IFRS and may not be comparable to similarly titled measures reported by other entities. For more information, please refer to the section Non-IFRS Financial Measures of our MD&A for the period ended September 30th, 2023. I will now turn the call over to Kevin Henley, Canadian NetREIT's President and CEO. Kevin.

Thank you, Ben, and good morning, everyone. In the third quarter of 2023, our team dedicated efforts to lease renewals, refinancings, and property dispositions. We are happy to report that in addition to the Timmins property sale in Q2, we also sold a restaurant property operated under the Mike's banner in Trois-Rivières, Quebec for $1.3 million during the third quarter, and a Pizza Hut property in Dartmouth, Nova Scotia for $1.65 million in October. These transactions, exceeding our RFRS values, continue to show our ability to create value while enhancing our capital structure. At the end of the quarter, Canadian net REIT boasted an occupancy rate of 100%, combined with a conservative payout ratio of 55%. All expiring leases for 2023 have been successfully renewed. Looking forward to 2024, we have 12 leases up for renewal, representing around 1.7 million of NOI. Renewed leases account for 74% of expiring NOI, a notable increase from 40% last quarter. We are confident we will be able to renew the remaining 26% in Q1 and Q2 of next year, as stipulated in the tenants' leases. The average lease term across our portfolio stands at 6.6%. Despite the strong portfolio performance, this quarter faced challenges due to higher interest rates on mortgage renewals, variable rate debt, and notably line of credit interest. This resulted in a stable FFO per unit for the period and a slight 5% decrease over the quarter. In terms of transactional activities, there is no significant change from previous quarters. Bid-ask spreads remain too wide to transact. Market sentiment suggests rates will lower in the future, paving the way for increased transactional activities. On the financing front, we renewed two loans in Q3 2023, one generating approximately $700,000 of liquidity. About $8.5 million of mortgages, including those in joint venture, remain to be renewed in 2023, with completion expected in the coming weeks. Following mortgage renewals, we anticipate generating around $1.5 million in net proceeds to repay credit facilities. Additionally, during the quarter, we repaid our $1.4 million convertible debenture issued in 2018. As we move forward through 2023 and 2024, our goal is to optimize the REITs capital structure, ensuring a robust foundation for growth. I will now turn the call back over to Ben Gazzis, who will review our Q3 results in more detail. Ben?