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New York City REIT (NYC)

Participants
Louisa Quarto Executive Vice President
Edward Weil Executive Chairman, CEO, President & Secretary
Christopher Masterson CFO & Treasurer
Bryan Maher B. Riley Securities, Inc.
Call transcript
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Operator

Good morning, and welcome to the New York City REIT Fourth Quarter and Full Year 2021 Earnings Call. [Operator Instructions]. I would now like to turn the conference over to Louisa Quarto, Executive Vice President. Please go ahead.

Louisa Quarto

Thank you, operator. thank and joining Call. Full and NYC's for everyone, Quarter Fourth Year morning, you us for the Good XXXX Earnings event in NYC's webcast is Relations This of section the website Investor www.newyorkcityreit.com. at being

We on or refer today uncertainties. call Weil, are date cause all Chief risks these subject statements, of filings risk materialize, provided Mike Financial Executive for results ended the year December Chief could including The all Should XX, discussion following results statements during factors more this may a me discuss XXXX, that only more information of of these subsequent this filings, the forward-looking the Joining SEC NYC's Masterson, Chris detailed which made and statements. March of one quarter's of actual and and to or SEC to Officer; filed materially or the differences. uncertainties filed XXXX, Officer. the risks the are to our those from NYC's XX-K forward-looking implied forward-looking as call for contains the on by are call. differ Any you expressed XX,

filings, call. in company's update in any isolation implied performance. A go Also statements, NYC our Officer a use financial prepared City Weil, or to over useful the GAAP. we New Michael These available investment-grade release not most today's also release. obligation evaluating call, of financial intent now can a as Please ahead, Chief consider throughout Mike. we to today's detailed during the or Executive As about for in be refer be substitute what measures in as be with is to should which these term considered we for believe accordance required stated the financial of directly non-GAAP earnings comparable results earnings I'll turn York to Please call or measures measures, GAAP our will to information SEC we forward-looking these more our our law. revise disclaims tenants, REIT. except reconciliation by in will measure discuss

Edward Weil

Louisa. for statewide and and and return our joining it New discuss for you helped NYC strong shareholders we'll pandemic how vibrancy initiatives well the significant in to that way vaccination of rates turned The corner and soar. mandates Thanks, long offices another York Because COVID return and XXXX to X offices for have Thankfully, for New York drops property navigate City positioned we've achieved that numbers. proactive preparing impacts. Yorkers regulations benefit return return to and REIT morning, City us. positivity to in us return is management Good mass thank rates rollback Today, York for the has appears years of pandemic-related normal. as their workers paves tourists been as in asset New successfully to the and of it, New to

is on stock peer focused we return unprecedented an based New appreciation REITs dividends by outperformed group a shareholders For through price the period the beginning of S&P X, over XXXX Through York the pure-play delivered of create over of This exceptional XX% XXX these March and XX%. years and value the grade and City paid. total tenants to agency by to XXXX, times, portfolio, and XX% between there remains NYC has the potential which believe Nonetheless, significant continued City our X has proven marked that New to York years last investment to meaningful come. we by for market our resilience and outperform peers. which for over government

amount X% portfolio. growing of fourth due cash quarter, a the an the XXXX. of increase rent of due third the collection the from across original XX% and recorded improvement Over amount the In quarter the for fourth a our last period, quarter in XX% the we in due from rent we XX% year, collected

of XXX% that agreements. in XXXX, collected rent we addition, of the to was and deferred In pursuant due approved fourth the quarters third

annual provide cash Form XX-K will detail additional collections. on on report Our

largest throughout country, the City the deeper New the property densest anywhere impact management than the have longer York management rent the our we in of As which on of proactive this, remain else city functions, light and In and perhaps the pleased COVID pandemic. in States. maintained United asset collection lasting was with of results

co-working percentage to from a pandemic sooner in year, approach rent from opportunity team of up another portion exceptionally with Quick reach Parking to agreements leases while executed clauses, the to our X we challenges. retail well Knotel, furnished key at to levels and we to of the every rent already increase XXXX to rebound cash ICON execution, innovative result, tenants. and space nearly have and from we and lines, over time also their and, tenant. at Park, our engaged no These them our in new original of pandemic-related expected. that with as was businesses to set managing expected we've portfolio. was agreements complete example last our continue co-working rapidly these formerly prior returned leases at tying management recovery both previous to licensees tenants in from allow been their space some remains we working operations year, responsive, a Where Along towards possible, tenants tenants performed such signed place Last Since agreement replace how creative that that Americas, began leases leased lows. with work asset tenants than remain and Our We Avenue to our sales a much the closely which rent office, buildings. contain NYC have launched Innovate the a licensing as are

the former rent year of X XX% feet space and Knotel we've X-year March or full in combined leases more Street since up with a a XX,XXX leased the executed at and remaining occupied Recently, Through years annualized tenants. only rent-paying Specifically, X creditworthy XXXX, lease of replaced XXX declared the square Knotel previously a tenants we've $X.X and occupancy. formerly Square rent. LHi previous bankruptcy. Knotel by Knotel term of leases lease for signed than These straight-line extending of of William much Times XX% with X-year X, not license, have after additional signing growing weighted almost of million space average but their the

the and tenants team physical turnkey COVID months. attractive very it executed, parking space seamless space reestablishing Our as transfer responsibility we for these happy new former transition, have better office the or garages and leasing of operator. of been our these million from licensing space we management to to will Knotel agreed we actively $X.X fee remaining In are a being be to have establishing the former Last transfer XX payment in quarter, connection amazing couldn't believe a high-quality an The marketed, with and abates. termination a done the properties. only new operator. of has job who garages running to The we're finalized new partner is

asset execute current lease lease very working the on well team to renewals busy Our has expiration. been before tenants renewals, encouraging management also

new annualized XX that $X.X full we added the rent. executed of XXX,XXX For approximately straight-line of for square leases million XXXX, year over feet

extension $XXX,XXX. to straight-line annualized tenant with by that an X-year new X credit we lease increased the In AaX addition renewals, completed leases, tenant rated rent from including lease a

weighted a that portfolio a over occupancy leases of X.X We and At if forward-leasing occupancy XX.X%, increase also lease of $XXX.X years. million million, year-end, foot will to XX,XXX have of these term had pipeline X.X average square commence. XX% our feet square remaining

XX%, we've to throughout begun leasing of by But more of by revenue progress Of work million, from more asset NOI our Chris continuing grow and $X that quarter-over-quarter, $XX.X made doubled our increased our million quarters the core million. XX% reflect grew fourth $X.X course, and cash all to happy to million give I'm management and done Comparing and quarterly $X.X good results. details. the increased than over for million. initiatives portfolio XXXX $X.X annual adjusted report EBITDA let I'll have XXXX, revenue and and our well numbers. is by FFO and in the to to improve grew to purpose

remains government net the office of City York necessity maturity. real strength agencies. retail City and We XX% in TD estate highly long-term We've York years sheet fundamental CVS, Bank, a based New City on weighted pure-play of X strong Bank confident leverage York investment-grade average large City of and remain state with mix New the space. New including a debt in balance of of belief built over that and features Our our National tenants, portfolio

the and us stability year, March that is current positioned of is year across XX, XX% I'll the forward the existing through drive City to you to implied market average With earnings of collection the XX which X, last financials. the City our through an fourth that in investment and built. we we go our significant to investment-grade York New quality increases starts Masterson As XXXX substantial appreciate and have rated to beginning over to over the tenants it discount and remaining NYC's results? or and portfolio can continued believe full December York negotiating for Chris new were leases believe price and gains believe the being REIT term to We've of the return NAV, the tenants XXXX, rent well New and with total X.X trading growing our during years investment-grade a community since as lease XX% the portfolio. take realize value a portfolio. we turn quarter of top Chris,

Christopher Masterson

of quarter. loss million $X.X also losses $X.X the XXXX. XXXX quarter fees, attributable $XX.X quarter quarter termination million fourth fourth net Net and the and net a million in and a loss XX% fourth the was compared for for was Revenue XXXX. XXXX fourth quarter in quarter December Revenue quarter quarter fourth $XX.X XX, Mike. XXXX. the Thanks, and and the million full in for operations. $X.X and third for of Revenue accelerated $X.X amortization unamortized loss for GAAP stockholders million income the in a increase year compared for $XX.X last to million in was company's million the over remaining of the net the the prior in which common respectively, $XX.X $X.X to of full million to the respectively. million, Revenue million and million, $XX The of the of was in $XX.X NOI ended quarter million in year million $X.X fourth includes XXXX liabilities recorded year million of full approximately of tenants compared in compared includes lease from consolidated Cash increase quarter is $X.X XXXX $XX.X of was the $X.X Revenue quarter. to XXXX below-market statements XX% from balance fourth million the year to

quarter in For of share third or million quarter Core the to same $X.X FFO million $X.X negative $X.X it XXXX, compared or $X.XX $X.X in was XXXX. per or increased negative fourth a in XXXX, quarter. million stockholders $X.XX share quarter FFO attributable negative in share XXXX, was in to of fourth million $X.X per our the negative the quarter the common the fourth negative the $X.XX per third $X.X quarter from from and negative million million

As weighted of a remaining some remarks. With term X.X XX-K. to the at income within fourth turn rate back reconciliation our with average at maturity NYC years years. net non-GAAP to and scheduled no debt interest weighted supplemental Form maintains that, GAAP effective net and the debt can with We prudent XX.X%. of closing quarter and ended call the debt always, average million conservative X.X% of a found earnings for I'll release, net balance leverage measures sheet a X be a Mike of next in $XXX.X

Edward Weil

abate. resilient Great. deliver Thank Manhattan-focused to believe as City that is long-term positioned portfolio value our continues We COVID-XX to significant and Chris. well you, York New

and the independent the NYC alignment independent over affiliates, NYC's This value our owned Our by ownership. demonstrated XX,XXX last separately Board over and long-term affiliates and proactive believe owned us adviser separately, In of NYC's increasing directors, adviser our as of X the each X navigate March commitment that its NYC X, has have interest myself management members depth our million we approach and to drives shares to asset of successfully years. shares. of helped its total, the

vacant substantial leverage In tenants our owning of to expertise collections resources shares, we we've significant able the micro-cap asset being of property utilizing rent to Despite have by management management access a been addition and these re-lease of to resources be to and have COVID on fronts. the throughout that allowed the a to platform. proactive replace increase adviser space, number company, us

We and tenants in XX% rents our and with due original the worked surrendered who return positioned the lines agreements, With upside significant believe operator, to their benefit we've a the quarter and have fourth licensees sign over the operators from and we time, collect full this post-COVID open During space. company have potential is there replaced and please for tenants normalcy. new cash questions. to leases that, of to

Operator

Instructions]. [Operator

today question from B. Maher Securities. comes first Your with Riley Bryan

Bryan Maher

Maybe Chris, that? certainly give the we in some on lease triggered It start below-market us expecting with, liabilities, of what model. wasn't our on you can were amortization color something

Christopher Masterson

that So to quarter. of termination due was the in lease fourth garage the actually parking the

when to of the going the amortization below-market now have the So new terminated, to rent to that operator we're that lease. who we now, the from all brought related was accelerated operator. we going continue forward, And in

Bryan Maher

the Street steady had William some that vacancies the of quarter, during we Times Okay. And any It backfilling like and about Was despite for thinking notable our to X there there then XXX seems Knotel model? pretty should be occupancies Square. stayed moving on space.

Edward Weil

And upcoming I sure just Bryan, want to you vacancies? make I the mean question. answer

Bryan Maher

Yes.

Edward Weil

No sorry, -- go I'm ahead.

Bryan Maher

Yes.

properties Is occupancy any there as what's to impact movement Just we would there on backfilling two how as in thinking going move relates existing kind we're Knotel other XXXX? of it about versus through tenants? that those

Edward Weil

look buildings. we positive Yes, at those at both net of absorption

Bryan Maher

then the Americas, there? X-part maybe we Okay. question. full of or maybe to should And take? drove look give about occupancy a And When the what dip XXXX, of of think how out year then Avenue ending the occupancy year, the you kind

Edward Weil

don't and you number coming of know. the half XXXX also as activity give new in York off strong in see being of tenants we don't market securing guidance, second active We City give leasing -- we the in As a the New XXXX being of building. very the

talked see activity, near the represents pipeline the that, So percentage in about pipeline a at the execution, point public about, continue discussing is are not portfolio deals. for of that but we occupancy that we've the behind point of more lot deals increasing. we setting. that to meaning occupancy, X There's in And is as that are additional it a

Bryan Maher

talked as X, XX% kind on look the think REIT. longer degree Got Necessity occupancy where you can when at you an in have it. Retail with to the is you about idea and X term, Do your I The years of now, it But XX%, X, go this portfolio a head out recovery?

Edward Weil

of should be it time. before. Absolutely. of growing tenanted into XX% It Absolutely. we second-generation XX%, space. This kind occupancy is it over portfolio has anticipate most the It's -- leasable been space, meaning

have don't more is build-out, we So which, of course, potentially expensive. raw

city heads So what looks roster they We're are are these that we into Management in positioned. expanding. and Chris well the seeing the tenants Team, new Chao, like feel assets who where tenants And that up the existing and tenant like. are We coming we the seeing renewing are Asset market.

into it be their now in the that back very that coming The corporate but should look are on as from bit We're a positive experience offices. spring positive may well. aspect very XXXX. we're So fact different, a tenants little it seeing

will continue to grow we will continue we the to and occupancy. So users, see

Bryan Maher

last Great. me. for And maybe one just one

past You've acquisition talked in sheet. you mean guys to a have What about a I outlook. degree the are you strong seeing? balance the

something hear You we do you're catching can there. are and something you think there seeing attention in might Are doing that out your that certainly deals be XXXX?

Edward Weil

growing to like We monitor we company, the to continue would and be pipeline. the acquisition will

of the it were the to looked seller type required seen of portfolio. COVID where haven't that of capital they a was We of situation at distressed felt where was We've we facing. impact and positive a that anything number addition a kind assets the

New great the we to be assets in of that opportunities for So there will acquire. York types City look definitely

be focused, to potential continue and forward will about look identifying We I Manhattan do to acquisitions. talking and

Operator

I no over turn further questions call to at are There this Weil, Mr. time. back the you.

Edward Weil

Well, thank us. for you all joining Great.

results. seeing heard you had really very As a presentation positive our company from is The XXXX. today, great we

XXXX be proud very of XXXX growth to continue the of we're The And We have a outperformance is exciting occupancy, something coming that time in company. for into really we against is this that on peers, and of, earnings. as experienced York S&P, focused growth forward against And to not we New we publicly our will to compare we soon. everybody City look we talking also the REITs. continue to execute, compare as but traded and only

you much. So thank very

Operator

This concludes today's conference call. Thank for you attending.

now may You disconnect.