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New York City REIT (NYC)

Participants
Louisa Quarto Executive Vice President
Michael Weil Chief Executive Officer
Chris Masterson Chief Financial Officer
Bryan Maher B. Riley Securities
Call transcript
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Operator

Good morning. My name is Chris, and I'll be your conference operator today. At this time, I'd like to welcome everyone to the New York City REIT First Quarter 2022 Earnings Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. you. Thank Instructions] [Operator Vice may Executive President, Quarto, begin. you Louisa

Louisa Quarto

the everyone, you quarter website. for you, webcast earnings operator. us thank morning, Good in being is first Thank joining of and for This event Relations Investor section call. NYC's XXXX NYC's

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

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

Michael Weil

proactive XX.X% cash Thanks, management joining rent effective the and portfolio the in XXX% see the quarter by value-generating excited end. thank across nearly you starting morning strategy, resulted first occupancy our Louisa. today. collection REIT, in I'm of with Good that at asset quarter and us York for property opportunities City of about New to X.X% portfolio of supported which in and our growth we

create brokers team significant Board and of by the increased remains tenants the increased our built the at quarter. dedicated during new On X.X% years at Square to that believe X% occupancy Times meaningful occupancy strategy of NYC the execution relationships pure-play work Directors. is a contributions the continued NYC's years, of hard the our our end Furthermore, continue value XXX over there strength for come. our reflection of independent and prior and to for to potential with over we X quarter, William the signed ongoing leases portfolio from of significant of Street we've management

returns Regarding to to has our exceptional discussed continued deliver last relative performance, total as NYC quarter. shareholders, we

return focused York the REITs stock of and both outperformed between City dividends paid. price based to larger XX, delivered the and shareholders March XXXX, XXX For and appreciation X, we on over of XX%. peer XXXX New by January total a period XX.X% S&P a group This

businesses. strategy we grow As I the to execute on our insight mentioned great and provide as earlier, to continues independent our Board guidance

only receive demonstrate in fourth and are it of stock shares to continued of company's agree, in stock We us been depth in lieu that confidence purchase received through we they've of purchases as purchases years, in two the company. through adviser engaged fee a last to Board's combination cash. fully quarter XX,XXX I have the while Board they we the future. and of pandemic navigate has the Naturally, have the of individual they in board Not advisory Board and a has as electing the over come NYC's believe lieu compensation. that I've its shares, Our instrumental also portion believe helping a members, stock stock over acquired stronger

May owned over adviser X, X.X the million common As of shares.

to long-term own and ahead such belief real have payments, We returns returning preparations but of additional into we've reported in Fortune new buildings, to fundamental their office existing and highly companies numerous portfolio, work We to office. the the team replace York return and leasing to their seeing first cash Workers the of come of an are our new rent tenants New also announced We plans return. quarter. are our New office quarter our strong City achieved remain part original first We has the based of made office in done the believe from the back believe lease with XXX of starting space. an in is details improvement estate tenants rent the from necessary. activity. not the tenants collection necessity the the with to only In on year. and to rent and number rent-paying quarter payments our contribute ensure success Turning the XX% on last of that York up XX% will we're to across workers of strength and collected tenants, making produced rent companies rent imminent office retail XX% to due collection the prior with where confident continued are to last renewals City increasing

York consists portfolio primarily and eight in New of and in located assets condominium entirely office Our Manhattan. retail City

remaining of City first absorption quarter, X.X years. of City quarter. a $XXX Across TD no all during lease portfolio, the portfolio average featuring of Bank, square XX.X% XXX% foot expirations Our net square agencies. had lease million, we York and lease of million pure-play had including We've footage assets, with end number large National occupancy built at of term terminations. investment-grade CVS, Bank of or X.X We our tenants, a New weighted the had government the a

As once of feet XX, and grade to leasing We've of go XX,XXX the March a lease were NYC's implied increase and years. average an investment tenants into rated occupancy is leases remaining X.X top grade by investment of built all by $XXX,XXX straight-line expected or pipeline square that effect. XX rent had X.X% term of XX%

on we Knotel of March leases been and XXXX occupied of in much formerly at by with former than including leasing focused of an William up the tenants. Square rent-paying Knotel with signing Through XX, space space successful creditworthy year, Times XX% For and the last Street. tenants we XXX more LOI X our have have pipeline, have in and been replaced the

Our team space. amazing licensing we turnkey Knotel The marketed, believe an high-quality is done by has grew actively attractive it job results well report being EBITDA and management XX% the our adjusted to initiatives that reflect will on remaining leasing happy I'm leasing core space to and by by XX%. revenue new and X%, FFO very we former and our as asset tenants. be

weighted conservative maturities maturities next have maturity. all this also any balance debt net have point average to minimal of We out debt that with until and debt XX% years I'd leverage rate. fixed We a or year of sheet don't X.X like of our XXXX. and is

based progress to quarter has since York strategy the broadly drive current As believe and XX.X% the that price, forward of that With well City from historic our pre-pandemic and tenants they towards New Chris discussed, Chris? go hard this return New while the in been York with validated trading first to I'll on rising. Masterson locked and are over are to REIT it to across rates beginning over activity a portfolio. City and were we of total we we've the lows, quarter, ongoing at We've previously leases in collection new our dedicated results. a rates the XXXX work negotiating as interest positioned benefit rent team. turn interest shareholders our existing growing continued

Chris Masterson

Thanks, Mike.

the compared GAAP loss of to stockholders a XXXX. the net of first revenue net in compared First million quarter million loss of quarter quarter $XX.X XXXX XXXX. million $XX.X common was was company's quarter to first $XX.X to in attributable The million first $XX.X

negative For last the of negative compared common million first attributable to to $X FFO XXXX, compared negative the to the was $X.XX of share per first share XXXX, quarter quarter in negative a XXXX. our year. first compared negative $X.XX million in million per FFO stockholders Core $X.X to million quarter negative or of $X $X.X was

million market termination to write-off garages. our core $X.X quarter, As FFO, impacted including a were by parking $X.X quarter fourth fee we results, a last million and related our discussed lease

have the flat approximately fourth negative of core quarter been quarter-over-quarter significant would items, share. at effect $X.XX Excluding these per per FFO share

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

Michael Weil

many excited asset value-creating as portfolio. our active We're ahead. New been about as ever City York strategy see opportunities Chris. pure-play We anticipate continue future management our and the will Thanks, to enhance that we've

revenue, return believe life combination XXXX, continue the of Our return remain resume. building as year operator, shareholders debt, have New seen an of that, the pre-pandemic adjusted and positioned exceptional are there of our through questions. diligent that we're the the please open momentum the and and for growth to opportunities this lifted a activities well lines beginning rate the FFO rest management and With York business fixed in mandates City With to since considerable growth through way of beyond. and core we conservative year-over-year in we've and EBITDA continued total been

Operator

Instructions] first with Bryan question from is Thank Securities. Our you. Riley Maher [Operator B.

line is Your open.

Bryan Maher

morning. Hi, good

Michael Weil

Good Bryan. Hi, morning.

Bryan Maher

you doing? Yes. guys How are

Michael Weil

well. Doing

Bryan Maher

article questions ago. year amount be morning. a space and that seeing few desk maybe There was of you usage an me about there? I a similar increase talk how in on business so was shared your you the might or in Journal it impacting a you sales. Are launched, increasing WeWork that think So from yesterday maybe this Can

Michael Weil

Yes, we are.

today, market the – number licensees. and some local a is expansions on have to who we've of had also Chris and existing continued done advertising, We've our We Chao, from call space. has referrals

see the as a of subsegment I space subs a shared market. So the very it's we – still guess strong

Bryan Maher

are think prospects speed in getting about I release. Can more short-term, I to were New think your in know demand City are in read the believe to of York what And license there's you talk moving Okay. strong substantial so then you space. that they about the insane parking a parking we on lease renewals why have renewal? costs in it's the pretty that I October. and and

Michael Weil

Yes.

as – state temporary I a just So to not have while we agreements. of the I read anything long-term just more than into execution short-term would extension anticipate

Bryan Maher

Okay. Fair then... And enough.

Michael Weil

those in to has And very residential collections pro primarily to continued we've on our exceeded one busy. you're City one The in – parking on, talked York parking more at it's rent garages which that's of And past, Memorial has right, our the And positive. of, be Sloan relied relies has traffic related Kettering, transient-day forma. these parkers. as and market kind very New garages parking

Bryan Maher

remember for facility, and sure they're like in Manhattan I not it's something, last $XX dissimilar a Well so charging. was drove I what hours it parked time I three crazy into

Michael Weil

Yes.

Bryan Maher

bit in Can expenses? we was you about OpEx than expected maybe little how higher costs quarter. our model on, the your other operating Moving utility inflation for is talk and impacting a

Michael Weil

Yes. that? to Chris, do you want take

Chris Masterson

mean, higher do the say little quarter Sure. by first that look what inflation driven a a perspective. take And usually is the little a really, But winter. bit this of quarter, would I affecting during historically, seasonality from when I an We is it's us. at the you the fact see bit is, OpEx

for such costs as higher have we heating. So things

[Technical Difficulty] So it's really

Bryan Maher

industries maybe Can little leases their us some from on future? color of prospects a the more And last new and them give demand Okay. that you're maybe but the for for the necessarily with, not in tenants their you space signing me. names,

Michael Weil

I basis, a morning. a got note Chris on Again, no Chao from Yes. this names just

XXst tech Street data a be at have We going West the floor to that a up is XXX taking company location.

We to tenants always continue do types in some property continue. Chris, of had see the the give you to we've that additional Brian want color?

Chris Masterson

marketing, nonprofit services. of – to such continuing we've as advertising, some creative We're said, financial as Sure. tenants continuance media companies. see, tenants, seen seen Mike certain not We've

been really it's gamut. strong. that So And has run pretty momentum the

Bryan Maher

me. all Great. That's Thank you. for

Michael Weil

Thank Bryan. right, you. All

Operator

any it We Weil have over I'll closing for to further no remarks. Mr. questions. turn

Michael Weil

Well, company, a right. occupancy, excited of you All performance. quarter are quarter to certain was think strong thank and overall these and second this portfolio's today. us very continue regarding occurring we very already joining things for are all the We that collection as the in rent for the strength positive trends the

again, and talking to you you forward soon. thank So to we look

Operator

Ladies concludes gentlemen, this conference you and for Thank today's call. participating.

may You now disconnect.