Good day, and welcome to the Allied Properties REIT first quarter 2022 earnings conference call. Today's conference is being recorded. At this time, I'd like to turn the conference to Mr. Michael Emory, President and Chief Executive Officer. Please go ahead, Mr. Emory. Thank you, Justin, and good morning, everyone. Welcome to our conference call. Tom, Cecilia, and Hugh are here with me to discuss Allied's results for the first quarter ended March 31, 2022. We may, in the course of this conference call, make forward-looking statements about future events or future performance. These statements, by their nature, are subject to risks and uncertainties that may cause actual events or results to differ materially, including those risks described under the heading Risks and Uncertainties in our most recently filed annual information form and in our most recent quarterly report. Material assumptions that underpin any forward-looking statements we make include those assumptions described under forward-looking disclaimer in our most recent quarterly report. Allied's first quarter results met or exceeded expectations with AFFO per unit and average in-place net rent per occupied square foot rising to record levels. Cecilia will summarize our financial results. Tom will follow with an overview of leasing and operations. Hugh will provide a development update, and I'll finish with our thinking on capital allocation. Now over to Cecilia. Good morning. I'll summarize our Q1 results, disclosure enhancements, the balance sheet, and our ESG program. First, our Q1 results. FFO per unit of CAD 0.61 and same-asset NOI of 2% came in as expected for the quarter. AFFO per unit came above expectations at a record high of CAD 0.56. Our forecast for 2022 of low to mid-percent growth in each of these three metrics remains intact. Our occupied space continues to be increasingly productive. Average in-place net rent per occupied square foot is up 4% from a year ago to CAD 25.13. We expect this trend to continue as our occupied space increases over the course of the year. We enhanced our disclosure this quarter. With our most recent acquisition, we reached 1,000,000 sq ft in our Vancouver portfolio, representing early-stage critical mass. Accordingly, we are reporting on Vancouver independently of Calgary and Edmonton. We also added disclosure around the timing of NOI contribution from our development completions before the impact of decapitalization, which is included on page 66 of the MD&A. On to our balance sheet. The acquisition from Choice Properties will improve our debt-to-EBITDA ratio going forward. In terms of liquidity, we currently have access to CAD 475 million on our operating line before exercising the CAD 100 million accordion. We're in a position to meet our commitments well into 2023 with our line. On to ESG. We're currently developing our plan to a net zero carbon pathway. It'll be outlined in our third annual ESG report, which will be released in July. To summarize, commitment to our strategy and our balance sheet is unwavering. Execution by our team through our operating framework has been unwavering. In fact, the business has not only exhibited resilience through this time of uncertainty, but it's grown and continued to evolve as we pursue our strategy in ever-expanding ways. I'll now pass it to Tom for a discussion of our operating and leasing results. Thank you, Cecilia. Despite the full lockdown in Montreal in January, we had a very good start to the year, completing 94 transactions totaling 440,000 sq ft. Average net rents achieved on renewals or replacements in Q1 were 16.6% higher than average rents in the expiring term. Our leasing teams are motivated. We just added an experienced leasing manager in Vancouver. We have upgraded available space wherever possible to speed up the leasing process. We have completed a show suite at 1001 Robert-Bourassa in Montreal. We've made a few adjustments with our listing brokers across the portfolio to ensure that we have the best possible teams on every assignment, and we're determined to move our leased area stats up meaningfully. There's currently good action in all markets, which I will describe shortly. Reviewing some information provided by CBRE on the Canadian office market as of March thirty-first, I note that Allied is doing well relative to the market. We have lower vacancy rates than the downtown markets in every one of the cities in which we operate, except Vancouver. We are higher than the market in Vancouver by only 1.5%, and that's likely to change soon. Before getting to a general update on leasing in our major markets, I thought it might be informative to provide a brief update on the 30 days post-closing of the Choice portfolio. The operations and leasing teams had been fully engaged in the weeks leading up to closing, and we were able to hit the ground running, absorbing these buildings into our systems seamlessly. We also onboarded 14 new employees with these acquisitions. Post-closing, we completed a three-year extension to Ontario Health, previously Cancer Care, at 525 University Avenue for 74,000 sq ft. We completed a short-term extension with NRC at 1185 West Georgia for 5,900 sq ft. We completed a four-year deal for the last remaining office vacancy at 1,508 Broadway. We are currently negotiating a short-term deal with a fitness club at 1,185 West Georgia for 25,000 sq ft and expect to finalize in early May. Early-stage discussions with medical-related use for 60,000 sq ft at 175 Bloor. We started dialogue on lease renewal rental rates with Omni Hotels for 20,000 sq ft at 1010 Sherbrooke. We've had many meetings with a major brokerage firm and are in the process of awarding listing assignments in four of the six properties. I will now provide a general update on leasing activities in Montréal, Toronto, Calgary, and Vancouver, and we'll conclude with an update on our urban data centers. Starting in Montréal, the team completed 38 deals and leased about half the space leased in the quarter. With a very slow start to the year, the momentum is building every month. We completed two deals for a total of 77,000 sq ft at 111 Robert-Bourassa, and we completed a deal with an existing film industry tenant for 15,000 sq ft at 740 Saint-Maurice. Just subsequent to the quarter, we leased 30,000 sq ft to a marketing company in Block D, a freestanding building at our RCA project. We also just agreed to terms with a tech company for 40,000 sq ft at 3575 St-Laurent, with potential to grow to 60,000 sq ft. As for what is next in Montreal, an existing tenant at Cité Multimédia has just re-engaged in dialogue for 60,000 sq ft of expansion at 111 Robert-Bourassa. We're also working with a life science tenant for 30,000 sq ft at RCA, and we're working with two companies for a total of 35,000 sq ft at 4400 Atlantic. Moving to Toronto. At The Well, we completed a deal with a tech company for 62,000 sq ft and also with a prominent music industry tenant for 26,000 sq ft. We reported last call that we were negotiating a deal with an existing tenant currently located at King and Spadina for 55,000 sq ft at 185 Spadina. Over the course of those discussions, the tenant decided to concentrate more employees in Toronto and now require 120,000 sq ft. We're in active negotiations with this tenant at The Well. We have three other tenants interested in various sizes for the last available space in the project. One way or another, we expect to be 100% leased in the office component of The Well very soon. In Calgary, we are maintaining an 86% leased area, which in the context of that market is good. We completed 10 transactions in the quarter and have seen good activity at Telus Sky on the last remaining built-out suite and are working on an existing tenant to expand by 18,000 sq ft. If we complete these transactions, we will be at 75% leased in that office component. We've made good progress at Vintage Towers in the Beltline and are now at 94.5% leased. In Vancouver, we're at 91% leased with good activity on available space. To add further color to the comments on leasing in our workspace portfolio, in addition to the negotiations already noted, we currently have 600,000 sq ft of interest in the early stages. Finally, we are 95% leased at our urban data center portfolio in Toronto. We are currently working on a transaction with an existing tenant to fill all the remaining vacancy at 250 Front and expect to be able to announce a deal on our next call. I will now turn the call over to Hugh Clark. Thanks, Tom. This quarter has seen the team reach a major milestone on one intensification project and significant advancements on a number of other current and future development projects. I will begin by giving an overview of our major projects, and then we'll follow that with an update on work we have done on our development pipeline. Construction activity. Beginning in Toronto, the building inspector is signed off on partial occupancy for the office tower at The Well. This will permit the tenants to occupy their spaces in the tower once they have achieved their own occupancy. This was a major milestone and the culmination of 10 years of work on this project for a number of team members. The remaining buildings are targeting occupancy over the next couple of quarters. The retail tenants will begin their fit-out work starting in Q2. Work on our other projects in Toronto and Kitchener continues unabated. We have reached grade at King Toronto and the expansion of QRC West and will now start to see work progressing above grade. At Adelaide and Duncan, team continues to push towards partial occupancy in Q3. At The Breithaupt Block, our partners are completing the majority of base building work and will hand the space over to Google to start their fixturing in early Q2. In Montreal, work continues on the upgrade work at 400 Atlantic, 1001 Robert-Bourassa, and RCA. In order to address the needs of the Montreal market, we've decided to expand the work being done at 400 Atlantic to include turnkey options for tenants. This has resulted in our pushing out of the date for 400 Atlantic being transferred out of the hut. At 1001 Robert-Bourassa, the team has completed the model suite on the second floor. The work clearly demonstrates what we are capable of achieving with this building and is a useful tool for the leasing team to attract potential tenants. In Western Canada, work continues on Burrard Exchange. Like at 400 Atlantic, we have decided to provide turnkey options for tenants. This decision has already resulted in one lease deal being completed, and a number of other potential tenants are indicating a preference for our building over other spaces in the market. Training efforts. This quarter has seen a number of significant events for our future intensification projects. To begin with, in Toronto, we have completed the purchase of Great Gulf's half interest in our King and Portland project. With full control of the project, we are advancing the plans to improve the offering to better suit the knowledge-based users that we intend to serve. This includes adjusting the design to reduce the carbon footprint and potentially achieving net zero carbon certification, exploring the use of hybrid wood and steel construction, and the conversion of the condominium component of the project to rental residential. We are excited about the potential of this project and intend on bringing it to the market in the fall. In Vancouver, we've entered into a joint venture with Westbank for the fourth phase of their Main Alley development. This JV consists of a 200,000 sq ft office development in the Mount Pleasant neighborhood. The project is already 50% leased to a major tech tenant. We are excited about the potential of this project aligning with our transition plan for adopting low carbon design, our ability to serve users in life sciences, as well as our expansion in Vancouver. We expect this project to take approximately two and a half years to complete from the beginning of this year. I will keep you updated on the progress of the project going forward. The team has also advanced work on the approval of other future intensification projects in Toronto. While we had hoped to achieve approval for our Bathurst Assembly by fall, it now looks to be likely given in the new year due to the fall municipal election. We should also achieve approval on the Castle early in the new year. The team has advanced work on the approval of our project at the corner of King and Spadina, with a formal submission having been submitted just subsequent to the end of the quarter. The team is excited about the advancements on the active construction projects as well as the future intensification opportunities. With the purchase of the Choice Properties portfolio, the team is gaining work on establishing plans for a number of those buildings. Our work at 1001 Robert-Bourassa will be instrumental in understanding the potential that some of these buildings hold and how we can transform the user's experience. I will now turn the call back to Michael. Thank you, Hugh. At the end of the first quarter, as others have alluded to, Allied completed its largest acquisition ever, along with its largest equity issuance ever, with the equity being issued at CAD 50.30 per unit, our NAV per unit at the end of 2021. We published our preliminary vision for integrating these six properties into our large, focused, and distinctive rental portfolio. The vision document is available on our website, and I'd urge those of you who haven't looked at it to spend a few minutes to go through it. In my opinion, an important industry theme this year will be the large-scale rebalancing of diversified portfolios in Canada between strong and experienced real estate entities. Allied's acquisition at the end of the first quarter was an excellent example of just that. It represented an important and compelling strategic refinement for Choice Properties and a significant and well-conceived expansion of operating capability for Allied. Allied intends to remain within two capital allocation guide rails this year. The first is not to increase our ratio of net debt to annualized EBITDA in funding discretionary acquisitions. The acquisition from Choice Properties, as Cecilia noted, actually improves this ratio. The second is not to issue large amounts of equity significantly below NAV per unit in funding such acquisitions. Again, we paid approximately 75% of the purchase price to Choice Properties by issuing equity at our NAV per unit as at year-end 2021. Clearly, we can make large discretionary acquisitions within the articulated guide rails. Allied did not utilize its ATM program in the first quarter of 2022. We currently have over CAD 475 million available on our revolving credit facility, with another CAD 100 million available through the accordion feature. This liquidity is more than sufficient to meet all of our current commitments over the remainder of 2022 and well into 2023. Allied is intent on growing its business, not shrinking it, all with a view to serving knowledge-based organizations more comprehensively and more profitably over time. Given our proven strategy and ability to execute, we will continue to allocate capital with a view to consolidating the ownership and operation of distinctive urban office and storefront retail space, which we aggregate into the term urban workspace in Canada's major cities. We believe that our strategy is underpinned by the most important secular trends in Canadian and global real estate. We also believe that we have the properties, the financial strength, the people, and the platform necessary to execute our strategy for the ongoing benefit of our unitholders and our many other constituents. I hope this has been a useful and comprehensive update for you. We'd now be more than pleased to answer any questions you may have. Thank you. If you would like to signal with questions, please press star one on your touchtone telephone. If you're joining us today using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. Again, that will be star one if you would like to signal, please. Star one for questions. Our first question today will come from Scott Fromson with CIBC. Hi, good morning, folks. Good morning. You gave a pretty comprehensive overview, so I have just some very minor questions. Just wondering how TIs have been trending. Is there any changes with leases currently under negotiation? How does it compare with comparable periods, say, you know, early in the pandemic and pre-pandemic? I would say the TIs have maintained their level throughout. The only difference is, in some cases, as alluded to in the speaking notes, we've elected to provide some build-out suites, which actually comes along with a corresponding rent increase for us. Generally, TIs have been more or less the same. Okay, thanks. Of the leases maturing in 2022 and into 2023, is any of the GLA earmarked for the transitional portfolio? That is a good question, Scott. I don't think any of us can answer that. The Tannery in Kitchener, we might be doing that. There's a large space that's coming back. We have to Yeah. see whether or not that needs to be upgraded. I don't think there's anything material Yeah. coming, maturing. Yeah. Certainly nothing occurs to me, although it's something we should look at carefully so we can answer the question more confidently. Okay. A final quick question. Have any of the users at The Well or future users of The Well put any committed space up for a sublease? I don't believe so. I think that there was talk of one doing it at one stage, but I don't believe there are any. Yeah. I think the architects were thinking about it, putting one floor on, but it's not clear yet whether they in fact are prepared to put that on the market. Okay. That's a relatively small tenant. Yeah. A good one. I know they were thinking about putting half of their space on the market, and, I don't know whether they've done that yet or not. We certainly haven't had to compete against it. That I know for sure. That's great. Thanks very much. I'll turn it over. Our next question will come from Jonathan Kelcher with TD Securities. Thanks. Good morning. First question, to clarify, Tom, in your remarks, did you say you're in discussions with 600,000 sq ft of space right now? Yes. The comment was at the end of the urban workspace comment, and it was just to suggest that there are lots and lots of conversations taking place. The total is about 600,000 odd sq ft across the portfolio at the very early stages. There's a lot of interest at the moment. Okay. I just wanted to clarify that. On The Well, obviously good leasing action there for you guys, and I guess you'll get the space that Shopify gave back leased up pretty soon. Can you maybe give us a sense of what the difference on rate that you expect to get on that space versus what Shopify had under contract? I'm so glad, Jonathan. We should see a CAD 15 per square foot uptick in rent on the 90,000 sq ft that Shopify didn't take up. Okay. What sort of percentage increase is that? That's almost 50%. Almost 50%. Almost 50%. Okay. It'd be like 15 on 35, right? Yeah. Roughly 40%. Jonathan, just to clarify, what Tom said in regard to The Well, there is roughly 120,000 sq ft remaining to lease, including the 90,000 that Shopify did not exercise their option on. We're in the very fortuitous position of having a single tenant seriously considering the 120,000 sq ft at roughly CAD 15 above what Shopify was obligated to pay. Then in addition, there are three tenants with an aggregate of 120,000 sq ft in the same position, if I understand. Where we would achieve the same. Where we achieve the same. Yes. Just so you know, this is why we're speaking with extreme confidence. A, that the remainder of The Well is for all practical purposes leased, and B, that we will get a CAD 15 uptick in relation to what Shopify was obligated to pay under his lease. Okay. That sounds very good. Just lastly, turning to the balance sheet. You guys do have a fair amount of floating rate debt. Maybe what's your thought process on hitting the unsecured market, and what sort of term would you be looking at right now if you were to do it? Well, the only floating rate debt we have, Jonathan, would be the facility we recently put in place to pay down the line. The reason it's floating is because it gives us complete optionality going forward. It has a three and half year term, if I remember correctly. We can always fix the rate if we consider it advisable to do so. But we're going to let it float because that gives us the option of prepaying without any cost. If the bond market was to improve, we might consider repaying with the proceeds from an issuance in the bond market. Similarly, if our cost of equity was to improve, we might consider repaying it by issuing equity. What I like about the floating rate in this particular instance is it gives us real optionality over the next six to 12 months, as to how we permanently finance, if you will, that CAD 300 million or CAD 400 million facility. We wouldn't normally be interested in variable rate, as you know, and as you rightly point out. In this instance, we were very interested in the variable rate, primarily because it gave us complete optionality going forward, in terms of either fixing the rate on the existing facility or repaying it with, debt raised in the bond market or equity raised in the equity capital markets. Of course, now we don't know which of those three alternatives we might elect, but having the ability to elect them in light of ongoing changes in the environment is really valuable to us. Okay. That's helpful. I'll turn it back. Thanks. Our next question will come from Mario Saric with Scotiabank. Thank you and good morning. Morning. Out of curiosity, what happened during the quarter that led to higher than expected AFFO internally? I suppose it would be two things. Number one, the NOI growth was solid and as expected. Our parking improved, our parking revenue improved, not quite to pre-COVID levels, but close. Finally, our regular leasing CapEx was probably lighter in the quarter because most of our leasing costs actually in 2022 and onward will be related to income enhancing rather than regular leasing expenses. We will have significant leasing expenses in 2022, but a very significant component of them will relate to improving the revenue-producing potential of the properties actively being upgraded, particularly those in Montreal. Just for the record, the three in Montréal that I'm alluding to in that regard would be RCA, El Pro, and 1001 Robert-Bourassa. Okay. Maybe switching gears to the kind of market rent and occupancy. Just on the occupancy side, I can appreciate the expectation for a meaningful uptick as Tom was noting in the commentary. In the shorter term, do you think internally that Q1 lease and economic occupancy represented trough? Do I think it has troughed in Q1 of 2022? Is that the question? Yeah. That's it. The answer is yes, with one possible exception, and that is at 1001, we will be taking space back on the upper floors. Again, as part of our repositioning program. I don't know how we will characterize that, Mario, we haven't really had the time to determine that, but that could. That only could have a negative impact on our occupancy over the remainder of 2022. Nothing else that I'm aware of can and will. Certainly we're becoming more confident with each passing week or month of our ability to achieve our leasing objectives for 2022. We are gonna be taking back four or five floors at 1001 Robert-Bourassa. I don't look upon that as, if you will, vacancy. That's really part of a repositioning program. It's one that will take the form that we've described at some length at 1001 Robert-Bourassa, where the floors transform magnificently from chopped up ugly light and trapped space into open very well illuminated very spacious cubically and otherwise. We've got to make that transformation before we can re-lease the space on the terms we know we can now achieve in the market. That would be the only thing that might hit numerically in 2022. As I say, that's part of a long-awaited repositioning program that we're now fortunately in a position to execute very very successfully. We know the demand is there, but we've got to make the transition first before we can lease the space. I got it. Just on those four or five floors, is there a target return on capital that you're looking at? Or is that a difficult question to answer insofar as, you know, it's part of the overall, you know, bigger redevelopment at the property? Like how should we think about the return associated with repositioning the space? It's a little difficult to articulate in isolation, but what I can say that is useful is that we do expect to achieve on that project the kind of spread we would achieve on a development. As you know, Mario, from long conversation with us and others, we won't do anything if we don't think we can achieve at least a 150 basis point spread to the cap rates. I'm very confident actually, of our ability to achieve at least that in relation to 1001. It's going to be most likely achievable at the end. I don't know whether any segment of four or five floors will get there, but what we're targeting, we're basically looking upon that to perform like a development for us. That our total cost will get us to the point where there's at least a 150-200 basis point spread between the unlevered yield and the actual cap rate that we could sell the building at in the market. We're encouraged, certainly by the cap rate end of that equation in the Montréal market. It has traded more strongly, more rapidly than I would have expected in Montreal. Vancouver has traded rapidly and strongly, but that was no surprise at all. I think Toronto's not gonna be a surprise either. I was amazed to see how rapidly the demand to buy urban office space reasserted itself in the city of Montréal. It's far from over. It's just starting. Okay. Just two more quick ones. Just first on market rent and then the last one just on a comment in the letter to shareholders that you made. So on market rents, like some of the brokerage out there, like CBRE, put the quarterly data stats and actually showed market rents coming up a little bit in Toronto, but that could be impacted by changing composition in terms of new supply coming on board and so on and so forth. It looks like your estimated market rents came down a little bit versus Q4, but it seems like most of that is related to Calgary. If we just step back and say, you know, if three to six months ago you had space in the market at, let's say, CAD 25 net, in your core portfolio in Toronto, like what are you asking for today on that space? Has it changed materially or significantly in either direction? If I understand the question, Mario Saric, you're asking whether or not we're confident that we'll continue to see rental uplift in the Toronto market because No, not. Yeah, not so much the positive lease spreads, but rather the actual kind of underlying market rent for your assets or for your portfolio. Has that changed in either direction, quarter-over-quarter over the past six months? I'd have to say not. I think that they held on very, very well. There's a limited supply in a lot of the product that we have. Yeah, my sense is, and Tom, you're more active on a daily basis certainly than I am, but my sense is, the level of rent our core Toronto portfolio has not eroded one bit and really has continued to grow through the pandemic. Maybe somewhat more modestly than it would have in a different environment, but it appears to me to have continued to grow. We're just not letting anything go at a low rate. We just aren't doing it. It's not because we're so tough or so smart. We just don't have to. There's always someone there to take the space. We will always wait for the level of rent that we believe our portfolio can command. This is why I think our average in-place net rent per square foot keeps going up quarter after quarter after quarter. Because basically, there's not a huge gap between what we expect for our space and what the market's prepared to pay. Nobody's lowballing us. We don't see tenants coming to us with really lowball offers at all. Yeah. One of the things to appreciate about our leasing world, and it's very interesting, and we've all lived it now for probably five or six years. Price is never what we negotiate. Again, it's not because we're tough, it's because the market is pretty well understood by the intermediaries. The real issue for us is always whether our space meets the requirements and aspirations of the employer. If it does, the market's pretty efficient at determining what our space is worth, and we just don't lose business over price. In fact, yeah, I can think of an example which I don't mind sharing. There was a major marketing firm located on Bloor Street who looked at The Well for, you know, a reasonably big requirement, maybe 200,000 sq ft, maybe more. It was clear that deal was being run out of New York by people who didn't know anything about the market. The only thing they cared about was price. We basically sent them down to the innovation center on the waterfront, where they could get good, cheap space. I'm kidding. We didn't send them there, but that's where they went. That's what they were looking for. They didn't care about anything else but price, and we had no wish to have them in The Well, and we didn't need to. Our rental rates have not eroded. If anything, they continue to grow. As we've said at The Well, they continue to surprise us on the upside. The big conversation, Mario Saric, was about an ability to expand. These are largely tech companies, and they're interested in how they can grow. The advantage we have is we can expand these tenants within our portfolio. Maybe not the building that they're in, but certainly elsewhere in our portfolio. A perfect example was the one I cited, where we've got a tenant in 25,000 sq ft at King Spadina. Wanted to grow, thought they needed 55,000. We're interested in 185 Spadina, very keen, super interested. All of a sudden they decided that's not gonna be big enough for us. We need more space. Okay, we've now got this space at Shopify aren't taking. Let's talk about that. We're letting those do a deal. It's really a tenant is interested more on the ability to grow than they are about rent, I think. The Toronto market is efficient. It's really efficient. Like, nobody steals space from anybody, and nobody grossly overcharges for space. The established sophisticated users are very well advised, and the intermediaries in Toronto are very, very good. It's an efficient market. There are very, very few price SKUs in high quality urban office space. It's just. You know, retail can be a little more subjective, but office, if you will, the buyers are very well advised, and the sellers know exactly what they're doing and exactly what needs to be done. Historically for us, it used to be whether our mixed-use, amenity-rich urban neighborhood was more important to the tenant than access to the underground path. You know, there are very rational reasons for preferring both. It was never about cost. It was whether the environment suited the users of the building better. If it did, the tenants were coming to us. If it didn't, they were going to the conventional towers. That's very rational. It depends on what the user needs and wants for its people. We even lost Apple, I think, to. They came out of Mississauga. We thought for sure they would come to our portfolio. We have a relationship with them in Vancouver. They went to the South Core because connection to the path system, which I consider to be rather imperfect in the South Core, but nonetheless it exists, was more important to Apple than being in a mixed use, amenity-rich urban neighborhood, which is where we have our concentration and strength. That tends to be more determinative of where people end up than pricing. Nobody, as I say, I shouldn't say that. Very few projects succeed by being cheaper. It just doesn't work that way anymore. They succeed by being better able to serve the needs of the user. The user will pay the price because it's an efficient market. That's probably more of an answer than you'd ask for Mario, but it is an interesting. You see, we're living this, and I just know our rents are not eroding. They're actually increasing. Toronto is where. Well, Toronto, Vancouver, they're increasing at a crazy level as well. Toronto is super strong. Montreal, the increases are much more temperate. It's a different market. The demand velocity is different. Fortunately also, there's no new supply being created in any meaningful sense. It is different in that respect too. Yeah. The conviction and enthusiasm is coming out loud and clear. I appreciate that. Just my last question. Just want to come to, Michael, your comment on the large scale rebalancing of diversified portfolios in Canada being a key theme this year. You've done the Choice deal. Is that kind of suggesting that there could be other larger scale opportunities to build the portfolio in your existing markets on the horizon? I wanna be careful not to create anxiety in the listeners. I know that in 2022 and probably 2023, a lot of rebalancing is going to occur. There, there's sort of two basic categories of rebalancing as I see the market. There are the weak aggregators who have had to disaggregate and to rationalize themselves back to something sustainable going forward. I don't see that affording any opportunity for Allied at all. Nothing of interest there. I think it's gonna be a significant part of the trading volume in 2022, and I think that real estate is gonna find its way into stronger hands or maybe, put differently, more appropriate hands. I think that's good for the market generally, and it's also good for trading volumes. It also reflects, I think, the reality of ongoing demand on the part of different investors for different assets. I think the pension fund interests are also going to be rebalancing from a position of very considerable strength, not from a position of weakness, because they probably consider themselves overweight Canada. That is definitely going to elicit opportunity for buyers. Whether it elicits opportunity for Allied remains to be seen. I'm inclined to think it will, but as I say, it remains to be seen. Choice is a similar transaction in my mind, and it is one of the reasons I expected to see what I alluded to in the first quarter conference call. What I don't know is whether the opportunities that will come forward will fit Allied's focus or not. If they do fit Allied's focus, we'll certainly look at them and determine whether it's appropriate for us to allocate capital to them at that point in time under those circumstances. I can imagine that it will be, but I can imagine equally that it won't be. That as I've said to investors for some time over the course of 2022, investors are very aware of what we did in terms of acquisitions. Investors are completely ignorant of what we haven't done or what opportunities we haven't pursued over the last 20 years. Believe you me, if an opportunity isn't right for us at the point in time that it presents itself to us, we will pass without blinking an eye. We have a lot to do as it is. We are dedicated to and excited about doing it. We're not gonna make acquisitions just for the sake of making acquisitions, ever. We never have, and I think that's one of the reasons we have one of the most coherent portfolios in all of public real estate in Canada. We intend to see that continue. If something will make us a better provider of distinctive urban workspace in Canada's major cities, we will look at it. If it's opportune for us to allocate capital to it, we'll do it. If it isn't opportune for us to allocate capital to it, we will pass, knowing that another deal will come two, three, four months later, as interesting or more interesting. Our goal is to consolidate and to continue to consolidate. Our goal is not to shrink. As I said, shrinking is of no interest to me. We will only consolidate if it represents appropriate capital allocation for Allied, given its history as a pretty good allocator of capital, in my opinion. Again, a little more than you asked for, Mario, but what the heck? I thought I'd give you an answer. Thanks again. The enthusiasm and conviction is coming out loud and clear. I appreciate the detail on all the questions. Thank you. Our next question will come from Gaurav Mathur with iA Capital Markets. Thank you, and good morning, everyone. Given the demand velocity for Class A or brick-and-beam space in the MTL/TO/VAN cities and the inherent flight to quality, in your opinion, is there any potential upside in the current environment to the targeted occupancy of 94%? Are you asking, Gaurav, whether we hope to achieve more than 94% occupancy on a stabilized basis? Yes. I wanna answer that carefully because I get myself in trouble all the time by overpromising. And I really want to avoid that. I do think on a fully stabilized basis, it's not unreasonable for us to expect our portfolio to be above 94% occupancy. I do not think there's any realistic possibility of our getting above 95% occupancy in 2022. Okay. I wish there was, but I think that alone is. It's not a stretch goal, but it's not a low bar either. That is an ambitious goal that we have established for ourselves and are committed to, but we can't blithely have that happen. We're gonna have to work very hard and have some good outcomes, in order to get there. Okay. Thank you for that, Michael. My final question, and I'm gonna change gears here. Now, the Choice Properties deal comes off as a win-win for both sides, and given your comment on rebalancing in the Canadian REIT landscape, are you thinking of using, you know, the LP Units mechanism a lot more for future acquisitions, just so you can stay within your capital allocation guardrails? It's a good question and a fair question. Until we did the Choice transaction, we had never conceived of that mechanism as something we could avail ourselves of on a large scale. I think what the Choice transaction has taught us is we can actually execute that kind of transaction on a large scale, and it does have real value to a seller in terms of deferring significant amounts of capital gains and recapture tax, as long as you believe in Allied's units and Allied's business. I don't wanna suggest we're gonna see an avalanche of transactions like this, but it's a possibility that we recognize more fully. If approached by an owner of assets that fit our investment and operating focus that was prepared to trade on this basis, we would now look upon it with more favor and more confidence and be better able to exploit that opportunity. Frankly, there are elements of that kind of transaction that I really like in terms of allocating capital and building Allied's operating capability. I'm not sort of signaling to the world, "Please come talk to us," but it wouldn't surprise me. Nobody has yet, just to be clear. If people did approach us over the remainder of the year and into next year on that basis, or perhaps even we approach others on that basis, that wouldn't surprise me either. It. Once a possibility becomes apparent, it simply becomes part of how you view the opportunity set you have as a business. For sure, we see this as a very good model for transacting between, you know, sophisticated parties who can understand the implications and derive the benefits from this kind of, if you will, utilization of units as currency. Thank you, Michael. I'll turn it back to the operator. Thank you. Our next question comes from Jenny Ma with BMO Capital Markets. Thank you, and good morning. Good morning. I appreciate the discussion on the guardrails for capital allocation, and I'm wondering, in terms of the ATM, how should we think about it under this new context? Is it something that falls outside of the guardrails, just given that it's fairly small in quantum, or is it something you put aside given that the Choice portfolio transaction allows you to, I guess, juice up your equity, and therefore, the ATM is not necessarily a tool you need to use for now? It's a good question and a fair question, and we've consistently responded to it by saying it does not fall outside the guide rails. It is not an exception. We will look to raise very considerable and very substantial amounts of equity through our ATM, but we won't do it at prices significantly below NAV per unit. So it does not fall outside the guide rails, it falls squarely within it. The dry run in the fourth quarter, I could argue fell outside those guide rails because we just wanted to see how that system worked. We were very encouraged with the results. We didn't even consider using the ATM in the first quarter, because you know, certainly pre-announcement of the Choice transaction, we were nowhere near NAV per unit. Even as we began to rise toward NAV per unit subsequent to announcing the Choice transaction, the whole market got distracted, understandably, with all kinds of uncertainties and anxieties, which I fully understand. Just to be clear, it does not fall outside the guide rails. Okay, great. That's very helpful. Turning to the IFRS cap rates, in particular the UDC portfolio. The cap rate on that had been pretty flat for almost two years now, and we saw a gap down by over 40 basis points this quarter. I'm just wondering if you can give some color on what drove that. Was it some other transactions that it was being marked against, or is it a bit of a catch-up, as it hadn't moved in a while? Anything would be helpful there. Sure. There was a transaction involving QTS that was announced late last year and closed earlier this year. That provided the appraisers with another data point. They always look at 1 Wilshire and 60 Hudson as the comparable properties to our UDC assets, even though they're not directly comparable, but they're just as unique, let's say, as our UDC assets. With that transaction, it did make them and us more comfortable in bringing down the cap rates across the board. Okay. That was the key driver of the move? Yes. Okay, great. Lastly, at the last call you talked about the potential for the CBC building to transact. Do you have any update on that front, particularly as it pertains to Allied and your options? No, we really have no update at all. I'll say three things in an effort to be helpful. One, we have not reached agreement with CBC on the acquisition of 250 Front, and I do not know whether we will or not. Number two, if we do, a transaction won't occur until late 2022 or early 2023. Number three, if we do, we have multiple options in terms of how we fund such an acquisition, and we will not go outside the guide rails to do that deal. Okay. There is no new information, Jenny, on that transaction. Frankly, I'm quite happy that the public process that CBC and CBRE felt the need to go through is over. Whether it will result in Allied doing a deal on that building or not, I truly do not know. Okay. Actually, one more question on that front. If you end up doing something, is bringing on a partner something you would consider? Yes. Great. Thank you very much. It's something. Oh. Just to be clear, it's something we have considered. Yes, absolutely. That's not the only alternative we have. Great. Thank you. I'll turn it back. Our next question comes from Mark Rothschild with Canaccord Genuity. Thanks, good morning, everyone. Mike, you spoke about why you liked this deal with Choice, where the way you were able to issue equity. To what extent in the future would you care about someone's intention on owning the units for long term or short term when you're doing a transaction like this? Maybe being even more direct, to what extent has Choice indicated to you how long term they would plan to own the units? It's a fair question, Mark, but I'm really loathe to speak for Choice or for the corporate group of which it is an integral part. I do think that group assigns real value to the units over and above the fact that they facilitate deferral of taxation. I don't feel competent or entitled to articulate views on behalf of either Choice or the corporate group of which it's a part. Is it relevant to Allied? Yes. To answer that part of the question, if I thought they were gonna flog the units at the earliest possible moment in the most expeditious possible way, I would be less inclined to do such a transaction. Can anyone give me assurance ahead of time that they won't do that? No. Can I rely on the perceived integrity of the counterparty? Yes. Am I prepared to in this circumstance? Clearly, yes. In other circumstances as well. I have to acknowledge on behalf of Allied, there is no assurance that the holder of those units is gonna do anything beyond the contractual hold period, other than sell them. Yeah, understood. Fine. Yeah. I think that's probably the fairest and most useful answer I can provide. Is it relevant to us? For sure. Did we think about it a lot? For sure. Did we take advice from Goldman Sachs and Scotiabank on the matter? Sure. We also know that no holder of roughly CAD 600 million of Allied's equity is going to paint itself into a corner. It's just not gonna happen, and I wouldn't do it either. No, I appreciate that. Thanks. Maybe just one more question. You clearly are positive on the fundamentals in your core markets for understandable reasons, and that is part of what gives you confidence to do larger acquisition. To what extent do you look at the impact of rising interest rates on potential value as you look at acquisitions now? Or do you believe that there's enough capital out there looking for properties and fundamentals will improve enough that you don't necessarily feel concerned about that? I'm not expecting the rise in interest rates to have any material impact on capitalization rates for high quality urban office assets. I may be wrong, but I don't see that happening. I think the demand in relation to the supply is such that transitory changes in interest rates aren't going to affect the value people assign to those kind of almost irreplaceable assets. I may be wrong, but that's my expectation. It doesn't, you know, we're a long-term buyer. It has virtually no impact on how we look at value because, A, we use a relatively modest amount of leverage. What really is important to us is cost of equity, of course, and that's the biggest driver in terms of our willingness to pay. Again, we're willing to pay because we're an operator, not because we're trading assets. I think most of the people buying the kind of assets we look at are not really conducting any kind of financial arbitrage. They're acquiring assets to operate them to add value, in some cases to trade based on the added value. In Allied's case, to own forever and to serve users ever better. I don't think that's gonna happen, Mark. Again, you know, this could take on a dimension, and we see in the papers almost daily suggestions that it might take on a bigger dimension. Rates may go up faster, in an effort to cool everything down. You know, at some point that has an impact. Again, most real estate buyers are not conducting any kind of arbitrage to debt. In the old days, that's exactly what we all did. We're not really arbitraging to debt cost anymore. It's a whole different ballgame. Understood. Okay, thanks. That's helpful. Our next question will come from Irina Prokopyeva with Presima. Yes. Hello. Do you hear me? Yes. Hear you loud and clear. Thank you for taking my question, and I apologize if you addressed it earlier. I wanted to know what's your outlook with respect to Calgary market, given how strongly performing Q1 and what kind of tenants are expressing interest in leasing, space, and maybe as well your expectations for the rest of the year. Again, I didn't hear that clearly. Your question relates to the Calgary market and our perception as to what's happening there and will we continue to see that market improve. We actually are physically seeing the changes now in Calgary. I'm not sure if you've been downtown there lately, but there are people back on the streets. There's people [on the streets]. There's a rush hour again in Calgary in the morning and the evening. Calgary is coming back to life and we're seeing a corresponding increase in traffic through our buildings. You know, we are confident that Calgary is going to come back and you know, we're seeing some really good activity in that marketplace. I'm hoping that answers your question. Yeah. With regards to leasing activity, what kind of tenants do you see most interest from? Increasingly, we're seeing tech tenants show up in Calgary. It's an area where the City of Calgary has been pushing really hard to attract tech to the city. The city has great appeal as an environment for young families. I think tech will continue to see growth in that market and certainly we're seeing our share of it. Okay, thank you. That does conclude the question and answer session. I'll now turn the conference back over to you for any additional or closing remarks. Thanks again, Justin, and thank you all for participating in our conference call. These were great questions and hopefully we were able to provide helpful answers. We look forward to keeping you apprised of our progress going forward until we next speak. Be well, and thank you again for showing up today. Well, thank you. That does conclude today's conference. We do thank you for your participation. Have an excellent day.