Excellent. Hello everyone. My name is Wojtek Nowak, Managing Director of Capital Markets, I wanna welcome you to Tricon's Investor and Analyst Day 2023. It's great to have you all here today, and really thank you. Thank you for joining us here in the room. Thank you for joining us online and making the time to hear our story. I know not a lot of companies do Investor Days every single year. We've done them for several consecutive years now because there's a lot that we wanna share with you. There's a lot that's going on in our business that we wanna talk to you about. We obviously want you to meet our team and interact with them. We're not shy about putting the team in front of you. Charlotte, if you can advance the slide to our team slide. You can see these are the folks that you'll be hearing from today. You know, importantly, we love to hear your questions. We appreciate the interaction, and we learn from it, and it makes us a better company. On that note, we'll be going through the presentations. After each presenter, we'll pause for questions. We'll take a couple of questions and then move on. We wanna get you out of here within 2 hours so that we can move on to our tech demonstrations. If there's any questions that are left unanswered, feel free to pull us aside afterwards or reach out to us via email. We're happy to help. Next slide, please. In this presentation, we wanna leave you with some key messages about our business and how we're doing. First, the value of Tricon is underpinned by our SFR portfolio. Secondly, the fundamentals of our business are solid. Thirdly, we will accelerate growth when the time is right. Fourth, we remain flexible with our debt strategy. Fifth, our adjacent businesses are a meaningful source of value creation. Sixth, we believe in sustainable and responsible growth. Without further ado, next slide. I'm gonna pass it over to President and CEO, Gary Berman. The value of Tricon is underpinned by our SFR portfolio. Thank you, Wojtek. You know, Charlotte, I like to walk around when I speak. Charlotte told me that if I moved out of this technical area, I'm gonna get a yellow card, so hopefully I'll stay on the yellow card. Wojtek, there's a lot going on in this world, don't you think? There's a lot going on. I mean, since last time we saw a lot of you guys, which was only three weeks ago at the Citi Property Conference, we've had a banking crisis, right? That was only this in the last few weeks. We are definitely living in uncertain and really interesting times, as the Chinese like to say, and we're cognizant of that. We really are. And obviously the, you know, the Fed going from zero to 5% really in a matter of months has affected us too, right? It's affected our earnings profile. We have to contend with much higher borrowing costs. What hasn't changed, and this is really what's important, there might be more earnings volatility, but what hasn't changed is our NAV. Our NAV anchors our stock, right? We wanna talk a little bit more about that today for you. We don't publish NAV. We're not planning to do that. We don't wanna tell you specifically how to determine our NAV. There's a lot of you in the room. That's what you do for a living. That's up to you. We thought it would be helpful to unpack it a little bit, provide you with a little more data, some additional data points, so you can think about your own valuation methodology a little bit more. The way we think about the NAV is really a buildup. It's what's on our balance sheet, and those are the value of our assets, that we use IFRS accounting, so we fair value that every quarter, and what's off our balance sheet, the value of our income stream for managing third-party capital. If you wanna think about at high level of all the assets that Tricon manages, there's about $16 billion gross, about $8 billion on balance sheet, $1 billion off balance sheet. We start with what's off balance sheet. We earned almost $140 million of fee income, including about $50 million in net performance fees last year for managing third-party capital. What's on balance sheet is the value you see here. It's $13.89 a share. 90% of that is in our core Single-Family Rental business, and 10%'s in what we call our adjacent businesses. Let's break down the adjacent businesses first. So 6% of that is in the Canadian Multi-Family Portfolio. That includes The Selby. It includes The Taylor. The vast majority of that are assets that are under construction that are held at cost. This is a conservative valuation for Canadian multifamily at about $0.89 per share. The U.S. Residential Development business, largely our legacy for sale housing assets, but also includes build-to-rent. We use a discounted cash flow analysis and a weighted average discount of 18%. Discount rate's 18%. That's very conservative, we think, for assets which are largely mature, stabilized, and really a business right now that's doing extremely well. Again, the adjacent part of the business at about 10% we think is valued pretty conservatively. Let's move on to the next slide. Now let's break down the core Single-Family Rental business of about 12.50 a foot. 12.50 per share, I should say. We use a multi-pronged approach for valuing our Single-Family Rental business. The first is the home price index. HPI, we call it. We use CoreLogic. This is really a pair trade analysis. We do this every single quarter. We value the homes. And then we also look at broker price opinions. Think about broker price opinions as appraisals. The broker price opinion we do when we finance. If we do a securitization or we do a financing, we'll always do BPOs. And those BPOs trump the HPI. Then we get a value for the portfolio, combination of the HPI and the broker price opinion. Then once we have that, we compare that to the NOI, right? The income in place. If we think about the stabilized NOI in our proportionate consolidated portfolio, that cap rate's about 5%. If we wanna factor in the [loss to lease], there's about a 15% loss to lease in our portfolio, that cap rate is about 6%. Okay. Between 5% and 6%, we think that makes sense. What we can do is we can market test that valuation. The way we do that is through dispositions. Every year, we sell, let's say, 300 homes. This year, we're planning to sell more. If you look in 2022, we sold 273 homes, and we sold those at a 9% premium to the fair value. That gives us a lot of conviction in the valuation. If we look at this quarter alone, we sold about 100 homes. We've sold those at a 12% premium to the Q4 valuation, again, giving us even more conviction in the $12.50 per share. $50 per share, interestingly, is the same as consensus NAV, right? What a lot of you are saying in this room as a group is that you're ascribing no value to the adjacent businesses, and you're ascribing no value to the third-party asset management business at $12.50. The market, based on where we're trading, which is about $8 or a little less than $8 per share, is saying that we are at a discount of, let's say, 35% just to the consensus NAV. The market, in a sense, is implying, if you wanna think it about this, that home prices could fall another 35%. We think that's extremely far-fetched, especially given that with mortgage doubling, home prices have barely budged, right? Again, some more data points for you to think about your own valuation. Let's go to the next slide. Our book value per share has grown by 18% per annum since 2019, and that's underpinned by real cash flow growth. If you actually look at the NOI, that has grown commensurately with the book value per share of about 17% per annum since 2019. Again, interestingly, our stock price hasn't moved since 2019. That really doesn't make any sense, does it, when you look at the book value per share and the NOI growth? Let's look at the interplay between private cap rates and public market cap rates, right? There's this tussle, right? This, you know, tug-of-war, let's say, between who's right, the private market or the public market. This is what's really different about single-family rental as opposed to commercial asset, the commercial asset class. The Single-Family Housing market, the Single-Family Rental market, is the largest, most liquid asset class in the world. There is no bright price discovery. There's no bid-ask spreads, okay? Every single day, there are thousands of transactions. We have that every single day, and that's why we feel really good about our own internal valuation of 5%-6%. Again, 5% if you include the stabilized NOI, 6% if you include the loss to lease. Green Street publishes their own SFR Cap Rate Observer, and the weighted average cap rate for our markets is 4.7%. Again, it's in that ballpark. We think about buying homes at right now at a 6% cap rate. That's 'cause we're buying very small volume. We're really trying to get to a 6. If we wanted to buy in large volume, let's say we wanted to go out there and buy 10,000 homes a year, we'd be looking at a cap rate of about 5.25. If you think about then the 4.7 Green Street's Cap Rate Observer and the 5.25 where we think we could buy 10,000 homes, that's where large portfolios are trading in the market today. There's not a lot of trades, but if you look at larger portfolios, let's say 1,000 homes, they're gonna trade somewhere between high 4s and low 5s on in-place income. Okay? That's where the cap rate is. It is determined. It is proven. That is the private market for single-family rental. Very robust. We've got a lot of data points to prove that. Let's compare that to the public market. Tricon's trading in a 7.5 implied cap based on stabilized NOI. If you include the value or the loss to lease in our portfolio, it's around a 9. That is a massive disconnect between where the private and public capital markets are, right? We know this, that the public markets can be very inefficient in the short term. I love that first exhibit in Warren Buffett's annual letter where he compares book value per share to the share price, and it can oscillate wildly from time to time. Over time, you're gonna see efficiency. The share price will catch up. For those of you that are patient, that can take a longer term perspective, there's a lot of value to surface here. This is a tremendous opportunity to own Tricon. Thank you, Gary. Let's go to the next slide. Obviously, to drive the NAV, you need to drive great fundamentals. Let's talk about the fundamentals of our business. I wanna invite Kevin up here and the rest of the team. Bill, Alan, Conor, Reshma, if you can take a seat on the side. Over to Kevin to start. Thank you, Wojtek. Great. Good morning, everybody. Hope everyone's doing well. Not sure if you guys were up early enough, if you guys got to see the beautiful moonset that happened. That's pretty special. Yeah, it was pretty cool. What I'm gonna do today, I'm gonna talk about the strength of our rent roll and our relationship with our residents. Before I do that, I wanna just talk about our culture. It really is what we're about. Gary talked about it yesterday. It's where everything begins with us. We're a people-first company, as Gary mentioned last night. We really believe if we provide a great working environment like this office and a place where people can come and thrive and feel safe in their job and be able to, you know, grow through their career with us, then they'll feel pretty comfortable, and they'll treat our residents really well. Our residents will take care of the business, and we'll take care of our investors. That's part of the reason I think that we have such a strong resident base is our relationship with them and how we're able to attract and retain them. If we go to the next slide, it'll give you a little bit of who our residents are and what's happened over the last couple of years. We've seen that our residents, their household income, have grown 40%, you know, since the pandemic to now. That's allowed our rent-to-income ratio to stay it dropped a little bit. That's important because at 23%, it allows us a runway to still increase rents and stay within that comfortable sub 30% rent-to-income. It gives us a really good runway. It also helps our residents and to withstand if they have any kind of temporary setbacks or things that happen in their for their financial, you know, for their homes financials. It helps them to withstand that because they're still in a pretty comfortable range. The other thing that's happened is we've had more households that are married, and with marriage comes babies, and that creates stickiness. Our turnover is lower, and that's why we're like 20% and 70% turnover. We've also seen FICO scores grow from like the mid 600s to the upper 600s. All the while we've endured the pandemic, our residents, which have been strong to begin with, have improved all the way through. Interesting enough, too, and I think there was a lot of ink on this during the pandemic as we saw a lot of movement from other states into, like, into the Sun Belt. That did happen, and you can see we had, I think it was 17% of our inbound residents were coming from out of state, and it grew to 24%. It stayed about that range. I know I got a lot of print, but still the vast majority of our residents come from within the state that they live. Just keep track of. We can go to the next slide. Part of the reason we have a really good resident base is from the very beginning, we focus kind of maniacally on propensity to pay. It's super important for us to kind of relay or mitigate the bad debt and the delinquency. So it starts really with the residents or the neighborhoods in which we buy homes. Bill will talk about it later. You'll see it live in our demonstration, but we really focus on the neighborhoods that we're buying. Then what we did about six years ago is we centralized the underwriting process. What was happening out in the marketplace invariably was that people were, you know, some of our folks were kind of wanting to make their occupancy goals, so they could get their, you know, bonuses and they would sometimes make wrong underwriting decisions, and then we paid for it later. About 6 years ago, we centralized it so that now we could set the parameters on how we underwrite people, and we could also watch compliance. That really helped. We were the first company to go away from Yardi and go into CoreLogic, which is now SafeRent. They had a much just a much robust program, a lot more sophisticated, and we've stayed with them. We've been able to sit with them on a monthly basis, quarterly basis, and really adjust the settings so that where we really wanna get the residents that will stay with us longer. As we've learned, you know, who's staying and what kind of residents will stay with us longer, we can set those settings. We've seen that we're pretty strict, and we remain strict throughout the pandemic to where we probably accept somewhere between 45 to 52, 55% of applicants. This slide doesn't go back far enough, but prior to the pandemic, we had 2 years worth of, like 0.8% bad debt. We hit the pandemic, the moratoriums came, our bad debt went up to almost 3%, and we've worked steadily over that time to get it down. We're down to 1.3% last quarter. It's continuing. It'll stay about where it is right now because we're seeing that some of the rental assistance is falling off, and some of the courts are still backlogged. We see steady improvement over the year and into the beginning of next year. Let's go to the next slide. Over the last, you know, six years, as we are really putting the foundation together for our how we accept people and our underwriting, we then decided recently, how do we compress that time that we process applications? Because we figured out from every day that we can compress the time from move-out to move-in, there's about $500,000 of vacancy loss that we pick up. It's something that we've been pretty interested in doing. Recently, what we did is we start asking residents or applicants to submit their identification, their proof of income with the application. That alone dropped our processing time from like 4.3 days to 2.5 days. It's a big move. What we're trying to do is we're looking at and considering going to an outside company, so the documentation that they give us, we send to them. They've got a lot more data and really good algorithms, so they can verify whether the identity is true and whether they're really making that much income. We're able to process faster, also reduce fraud and also push some of the liability off. The second thing that we're really considering is seeing if we could get our residents permission and actually ping their bank account to see if they have the balances that they say they have, and to see that they're getting the recurring income from either payroll or another source. If we can do that happens instantly. Those two things will drop our process another half day to a day, which again, you know, every day is about $500,000. Also by using these systems, we'll be able to scale more, so we don't have to hire as many people as we grow, and it'll help our gearing ratios. Pretty exciting stuff for us to see in the next couple of months and quarters. Next slide. You know, I started out with our culture. You know, we talk about, you know, really how we engage with our residents and how important it is. We have our Tricon Vantage, and it's really a slew of different programs that helps our residents stay with us longer and also be able to gain, you know, the financial independence that they would like, even if that means buying a home, you know, at some point in their career. We like to help them to do that. There's a couple things. I mean, you guys know that it's something that we've been doing for a while. We'll talk about more of that later today. We also have the Resident Emergency Assistance Fund. That's a program where we give residents $2,500 if something happens that upsets their, you know, they have a death in the family or someone loses a job temporarily. That's a grant that they don't have to pay back. We've given close to $200,000 last year in that program and about $550,000 over the course since we started it. We just kicked off a Resident Down Payment Assistance Program. This is how purposeful we are in helping residents get to the next level. If they wanna buy a house, we will give them $5,000 towards a down payment if they have stayed with us for 5 years or longer. We've already done that for 3 residents. We just kicked this off in December. We've had 3 residents take us up on that, and we have another one right now that's in escrow. That's something that, you know, we're gonna be getting out. I think that this year there aren't gonna be that many people that take advantage of it just because of where interest rates are, but over the coming years we'll see people take that. We also have a credit builder. As people pay their rents on time, we notify the credit agency, so it helps them build their credit. Then we have the Resident Bill of Rights. I think we're the first company, still the only company I know of that has a Resident Bill of Rights that really does. It just codifies what we've already done and what we're doing. It just now makes us accountable to the public markets, to everybody, you know, that we say what we're gonna. We do what we say we're gonna do. Let's take the last slide for me. Here, you know, we again, we've got a, I think, just a pretty special relationship with our customers and our residents. Instead of reading, you know, reading through these, and giving examples, we're gonna let you listen to one of our residents who we spoke with. The joy of actually being one of your tenants is the fact that your company truly believes in doing the right thing. I knew that I wasn't in a physical condition to do what I used to do and do the repairs on a home like my homes prior. I have found either through the app, through the online maintenance or at the very end through contact with you, whatever I needed to get done to make this my home and for me to be comfortable in the space and enjoy the space, I have been able to accomplish. The fact that knowing that when I make a phone call, I am going to get the assistance that I need in a timely manner gives me a huge peace of mind. I grew up in an era where neighbors knew each other, where even neighbors helped each other, they chipped in. The older people on the block, whether they were single or old or older couple, we took care of them. That same feeling which I feel has been lost in America, it's not lost here in this company. Yeah. The other thing about Jerry is he helped write the training manual for the TSA as they were putting that together. Formidable guy, been with us for five years. Not an actor. That's a real thing. There are plenty of stories like that that we have plenty of residents that we're helping, we're talking with. We're putting together more videos like that that we'd like to show not only, you know, you guys, but also we may take when we go talk to senator or mayors at different cities to see the, you know, the type of company that we are. I mean, that really talks to the essence of who we are as a company. It's kind of really our secret sauce. It's well and good today. Excellent. Thank you, Kevin. Any questions for Kevin? All right, let's keep going. Next slide. Over to Bill, talk about revenues. Obviously, our guidance for this year, 6%-7.5% same-home revenue growth. Bill's the man that manages the revenue, over to you. Last year, I think I talked about acquisitions. We're gonna have Jon talk about that a little bit later. I get to focus on my asset management, talk about revenue and expenses. Let's just jump right into it. Next slide. How do we think about revenue management? This slide shows you in a nutshell how we think about it. Later on, we're gonna demo the latest release of our new system downstairs in the tech demos, but specifically, we look at how we balance supply and demand indicators to form what we call pricing posture. What's pricing posture? It's essentially how much we are looking to push rents to achieve a targeted occupancy. Actually in our portfolio, as you know, there's a seasonal pattern in terms of, you know, supply and demand, and the demand that goes into our summer months, we typically strive for higher rent. We call that a rent bias, and conversely, it's an occupancy bias in the winter months. Ultimately, let's turn to the next couple slides to talk about some of the supply and demand metrics we're seeing in our market today and how that forms our pricing posture. Demand first, right? Let's we really focus on two key indicators. That's leads per available home, and that's applications per available home. What I like to highlight there in blue is that the big change, that's a huge change back to seasonal norms, from October 2021 through December 2021, compare that to same time this last year, Q4. It's a pretty pronounced drop that we saw, and we thought that led to some change in the market or some economic weakness. We weren't really sure. Then we see what happened in February, where we saw some massive year-over-year increase of 14% in terms of leads per available home, and then also the fact that applications stayed fairly flat or consistent. This is really good demand trends going into our peak season. Next slide. On the supply side, on the left-hand chart, you can see that really the rental home listings in our markets is what we're tracking here in that chart. You can see pre-pandemic, it dropped down to very low levels in about 2020. We're seeing actually revert back to pre-pandemic norms, and we think a little bit of that is due to people or actually have homes with very low mortgage rates, and there's essentially a lock-in effect, that they're probably looking to rent out their homes versus sell their homes. It's led to a little bit more moderate rent growth, but we still think this is a generally very supportive macro picture, which you can see on the right chart. That really shows you that our housing starts, looking at last year, SFR housing starts actually decreased by 13%, right? Which is a tailwind for the industry. Build to rent, we're hearing that, you know, is that really flooding the market with a lot of product? I don't think so. It's not really a threat to us. Lastly, we've heard a lot about multifamily at some point, can be a threat to our industry. We actually don't think that's a threat either, despite the increase in growth, because our residents really are looking for privacy, space, you know, places to put their things, and that you don't get the same experience in an apartment that you do in a single-family rental home. Next slide. Let's put it all together, right? We've had several years, you can see five years of rent growth here, and we've had a very supportive supply and demand metrics for our business to be able to push that revenue growth. On the previous slide, you see this acceleration coming through the pandemic in terms of new lease rent growth and renewals. Now, looking early on, in 2023, you can see that actually we've had a very strong renewal rent growth in the first few months at 6%-7%. That makes up about 80%-85% of our revenue growth right there. The remainder comes from very strong new lease rent growth, and then we think we'll land in the 9%-11% in Q1. Next slide. How are we really confident in our revenue guidance, right? One of the things that we talked about is self-governing our rents. We've been doing that for several years. We mentioned the figures a couple times that we believe our loss to lease is around 15%. We wanted to highlight for you today that actually it really depends on where you fall in the spectrum in terms of tenure or how long you've been in the home. If you have people that are moving out after 1 year, the loss to lease is gonna be a lot lower than if you've been in there for 7 years. Although that may oscillate from quarter to quarter, we think the 15% loss to lease is a tailwind for Tricon over years to get overall blended revenue growth. Next slide. The last slide in the revenue section is 4% of our revenues are coming from ancillary revenues. I'd say you've heard a lot about smart home, renter's insurance, you know, that's kind of standard in the industry. We still haven't actually rolled it out to all of our homes because people don't turn over, right? We usually do those new programs at the turn. I would say admittedly, we've been focused on portfolio growth versus adding new ancillary revenue opportunities, but you can see a few programs we've listed here that are gonna be upside for Tricon over time. Today, what we're gonna show you a little bit later is our Resident App, and I personally think it's gonna be a great distribution channel to continue to grow our ancillary revenues. Let me pause there on the revenue side before we get to expenses for one or two questions. Yeah. Any questions for Bill? Barry. Yeah. Just going back to the demand trend. Looks like there's a huge uptick in the leads and the applications per home. Is there anything that's, like, driving that from a one-time perspective? Is this just a rebound from seasonality, or is there, like, other things factoring into that? What's really interesting, we had a couple analysts plot, you know, the Super Bowl effect, right? If you notice that right after the Super Bowl, you can see it's publicly available, but there's a lot more demand that comes right after the Super... People look for homes. We think in February, not only was this back to that normal seasonality where you have the uptick, but there may have been just a wait and see approach with what was going on with all the, you know, kind of macroeconomy at the time, and it's come back to a more normal times. Yes, Charlie. As you think about the ancillary revenue opportunities. Sorry about that. If you think about smart home and renters insurance, what's the target dates? When do you think you can get to that 100% from roughly 50% in those programs? Yeah. You saw the loss to lease schedule on the last chart, and people are staying with us for seven years. We actually for things like smart home, we're talking internally about electively reaching out to folks that are actually occupying the homes and not waiting for the turnover to try to accelerate that. If you were just to wait for them to turn over, you'd have to run the multiple off the turnover rate and see how long it would take to fully realize that. I think a better indicator is that on all of our consolidated program we're seeing... I don't have an exact date on when we're gonna get there, but renters insurance is another program where we actually see about 70% of our residents on new homes as they adopt this right out the day they lease with us. We think that the adoption, as you continue to turn over homes, you're gonna have a much. You're gonna get closer to that 70% level for our Same Home portfolio. All right. Why don't we keep going? Next slide, Charlotte. Sorry, Mario. Did you have a question? I didn't see. Maybe one really quick one. Just coming back to the February data, the leads in the applications look really good. When we look at the new lease growth, it's come down a little bit versus January and Q4. Can you talk about kind of the disconnect between those two? Is it a mix issue? Are market rents coming down a little bit more than you thought? Just curious on that. Yeah. I think generally speaking, I tried to illustrate it a little bit that there could be a bit more homes that are being listed for rent, so it has a little bit more of a supply issue in the market that could have impacted us there. We think that also, as people move out on that spectrum, you could have more people that had rented homes a year ago, and so they don't have the same embedded loss to lease. There's a little bit of that happening, and that's why we think from quarter to quarter, it's gonna move around, but over time, it's gonna get closer to that loss to lease trend. There's nothing specific, and there's a lot less move-ins. It's percentage is a lot lower, just as people are moving in in the January and February periods. All right. Let's move on to operating costs. This year, we're expecting Same Home operating expenses to be up 6% to 7.5% as well, similar to revenues. We focus on what we can control, which is the controllable side of this slide, but we also try to understand the non-controllable expenses and give you as much visibility into those as possible. I'm gonna keep Bill up here to talk about our favorite expense item, property taxes. Property taxes. Yeah. 6% to 7.5% guidance on overall expenses, 50% of that is property taxes. Let's launch to the next slide. Over the next few slides, I'm gonna do my best. I put my glasses on today to do a little bit of a teach-in on property taxes. Let's just bring it back to the basics. In order to, you know, municipalities to establish their budgets, they have essentially 2 major levers, right? 1 is the assessed value, and the other is millage rate, right? You multiply the 2 together to get to your property tax bill. That's essentially what happens. On the assessments, right, the assessments can happen annually, or they can happen over multiple years, as you can see in the reassessment period. In certain markets, there's actually statutory caps or limits on how far you can grow that assessment. For Tricon's markets, 62% of the NOI falls into statutory caps. That's markets like California, 2% of the assessment, that's the max it can grow or, and that happens annually. Whereas South Carolina, that could be 15%, but that's over an eight-year period. The balance is coming in to markets. The 38% of NOI falls into uncapped markets like Georgia, North Carolina, et cetera. The trickiest part of the equation here is we understand where HPA is gonna go. It could be trailing a little bit, but we don't know where millage rates are gonna be, and that's where the counties balance their budget. Next slide. What do we do each year? We sit down with our tax consultants at the beginning of the year. We look at their assessed value estimates. We look at their millage rate estimates. In my opinion, I don't think our tax consultants have ever assumed a downward adjustment in millage rates. They just leave it to be very conservative. It's hard to believe that if you're gonna have a 20% growth in assessments, that you're gonna have a 20% growth in your tax bill. I just don't think that the tax basis will pay that. Typically, they're adjusting down their millage rates to balance to a budget that is fairly a balanced budget with low to little growth. What happens during the year? We set our Q1 accrual based on these meetings. Throughout the year in May, we receive about 50% of the assessments in the mail. By August, we have about 90% of the assessments. Throughout that period, if we're seeing large adjustments, then we will adjust our accrual accordingly based on what we had estimated. The part we still won't have is the millage rates. Those millage rates come, you know, towards the end of the year on the tax bill itself. That will be the final part of the equation, which again, can lead to a tricky or potential surprises in the last quarter of the year. The next slide. What the heck happened last year? It's something that I was asked at dinner last night, we get asked all the time. Our tax consultants, if you even ask them, I think that they would say that this is one of the hardest years. I think I was clicking too fast. This is one of the hardest years to forecast. Because of the high appreciation and not knowing where millage rates were gonna go, what we did is we actually assumed 12% growth on the assessments, but no millage rates adjustments downward. You can see that we actually missed, you know, in Florida, in Texas, in Georgia, all the markets that are in red on that third column to the right. We actually had a nice offset in those exact markets and several others. We were off by 4%, we made it up on a 4% reduction on the millage rates. We ended up flat, which is a tricky way to get there in a really tricky year, we felt that being more conservative was the right approach. Next slide. This is the last slide in this section. Specifically, what should we expect in 2023? We've given you our property tax guidance for our single portfolio of about 8%. In the last two columns, we've provided you by market, or by state, what the expected assessments and millage rates would be. High level, I would say that the assessments are gonna be relatively high, we have really represented little to no change on the millage rates. You know, looking at that, there could be some upside if millage rates go down. Additionally, we didn't talk about property tax appeals. They're not baked into this number, so we typically have upside on our property tax appeals. Lastly, I'm not in a position to give 2024 guidance, but, you know, if property values stabilize or come down, then that could be a potential tailwind for property taxes as we go forward. Thank you, Bill, for not giving 2024 guidance. Any questions for Bill on taxes? Jay. Do you have a fairly aggressive appeal process plan for reducing ownership? Oh, thanks. If in the event that we get into a market where we have values pull back to where you can actually do appeals. Do you have a plan for that to lower your tax bills if you get that opportunity? Yeah. Every year, we actually appeal. There's several markets we appeal every single home. Texas is one of those. It's risk-free. It doesn't cost anything, so we just automatically appeal. It's the way the state is set up. Georgia's another place. Any multi-year reassessments, we typically appeal. We have, you know, we're aligned with our advisors that they get a success fee based on what they save. I think the alignment's there, so we can be very effective on the assessment or sorry, the re-appeals and fighting those. Yeah. Do you have the shortest markets that you anticipate this year aggressively appealing, where you could pick up some of the savings? I mean, Texas is gonna be the largest market. It's gonna make up the majority of markets potentially, in Charlotte. Mecklenburg County is gonna have a multi-year reevaluation, which we're gonna watch. Yeah. Excellent. All right. Let's move on. Let's bring. Oh. Oh, Rick, yes. Are you seeing, more and more municipalities treating non-owner occupied investment like, SFHs differently from a tax basis? Sorry, differently in terms of what? Like, they're carving out in their, like, tax code, like, different millage rate treatments for, you know, the single-family home that's owned by an investor versus occupied by an actual resident. I think each county has their own approach depending on, you know, how they're going to bill it. That was a big discussion in Texas last year. I think, trying to be more supportive for, you know, that tax base. We look at it. We work with our consultants each year. We try to understand what kind of new rules or legislation might be passing that could affect us, and we don't see any large changes right now afoot. All right. Next slide. Is that working for you? Hello? Yeah. Perfect. Good morning. My name is Alan O'Brien, Chief Resident Experience Officer for Tricon Residential. Last year, we saw our cost maintain increase by 14%. That was really driven by two factors. First, our resident behavior. As we came out of the pandemic, our number of work orders increased for occupied homes because residents want us to go back into their homes and called in lagging or lingering issues that they needed fixed. Second of all, our residents stayed in their homes longer, our tenure of residents was increased. When they moved out of the homes, our scope costs were higher because they homeschooled their kids at home. They were at home all day working from home. That really increased our cost there. Secondly, our cost increased. If you look at labor costs spiked, especially in manual labor. Second of all, we had supply chain shortages occur which made our materials increase. Some of our materials went up over 20%, on the smaller materials. That's really what resulted in a 14% percent increase last year in our cost to maintain. Personally, our team, we're very proud of managing it to 14% with all those headwinds that came at us. We're really appreciative of our team for making that happen. Looking forward, though, we're set up this year to probably have mid-single digit growth in our cost to maintain, which we think will be a good success for us. When we look at how we manage our cost to maintain, there's really 3 different factors. One is our external vendors. There's about five work areas that make up 42% of our spend from vendors. They are roof, paint, appliances, flooring, and HVAC. We have national procurement contracts with our suppliers for all those materials. Hence, all we have to do is negotiate our labor cost, which is much easier with our vendors to install these items, and we get warranties on all of these items. The great thing about what we do at Tricon is that we always look for a win-win solution with our vendors. An example of this was last year when freight costs went way up. We actually worked with our HVAC vendor to increase for a short period of time our costs to cover some of that cost. Fast-forward to this year, the Department of Energy came out, and they required us to put a more efficient across the entire industry, even in your homes. If you replace your air conditioner, you have to put a higher efficiency air conditioner into your house. If you look at Main Street, that's probably a 50% increase in that cost, and due to our win-win relationships with our suppliers, we got it for an 18% increase. Not great, but much better than what Main Street's getting. That's our external vendor spend. If you look at our internal maintenance, over the last couple of years, we've really pushed hard on internalizing our work orders. We complete about 75% of our available work orders on occupied homes. We don't do things like replacing roofs. We don't install air conditioners, but what's available, we complete at 75%. Also, over the last 12 months, we've really pushed to do more work on turns. We believe all of this focus also reduces our cost to maintain. The final component to this is scope management. It doesn't matter if we're giving it to a vendor or internally, we have a team down here that looks at all of our scopes over a certain amount, if it's occupied home or vacant, and they approve it. They look at it, and they go, "Hey, should we repair versus replace it, or do we even need to do it?" That has really controlled our costs around there. Can we jump to the next page, please, Charlotte? Thank you. One thing everybody probably has noticed is that our capitalization has gone up significantly. Our percentage capitalization has gone up significantly year-over-year. This really has to do with the tenure and the type of work that we do on our properties. As I mentioned earlier, our turnover expenses are higher per turn, which means higher capitalization. I'll give you an example of this. Pre-pandemic, if somebody came out, we'd probably replace a small bit of carpet in a room or clean the carpet in a room, and that would be an expense. Post-pandemic, we might have to replace the entire flooring, which would be capitalized. Another example of that would be if somebody moves out of our house, pre-pandemic, we'd paint a room or paint corner to corner in a room. Post-pandemic, we may have to paint the entire house. Painting corner to corner or a room will be expensed. Painting the entire house will be capitalized. Thankfully, we've built a platform called TriForce, which has a rule-based engine inside the system, and depending on the cost and the type of work performed, it decides if it's expensed or capitalized. It's all systematic. Looking forward, we believe that this capitalization% will probably stay even or probably revert slightly back by the end of the year as we go back to regular maintenance repairs that we've been doing pre-pandemic as well as we keep controlling our turnover cost. Thanks, Don. Can everybody hear me? It's good? Okay. Good morning. Internally, we look at many metrics across the portfolio that don't always show up on the supplemental but really drive our operational numbers. As we scale, we feel that efficiency is a key focus for us, both from an occupied and a vacant turn perspective. We've designed thoughtful processes and initiatives to put our teams in the best situation to service our residents, our homes, and our investors. We can look at many metrics on the screen here, but we wanted to talk about how, as we scale, we become more efficient, starting with how our ability to lower our cost per turn by 11% over the last two quarters. We feel that our teams across the country do a phenomenal job of working with our centralized review team here, which is downstairs, to determine that repair versus replace criteria so that we're not over scoping a home, we're not under scoping a home, we're doing exactly what's right for the home. Also leverage our in-house technicians to go in on the vacant side and perform more of that work. We've increased our vacant technician utilization rate by 13% over that same time period. What that means is our technicians will go in and repair things such as a garage door repair, a cabinet repair, a touch-up paint, versus sending it to a third-party vendor. Really bringing that back in-house and controlling that cost, because we don't wanna pay that markup from the vendor. We wanna leverage our in-house technicians as much as we can. You know, moving to the occupied side, I heard Alan mention our 75% goal for completing our internal work orders with our technicians. That was our first goal for 2022. Our second goal was to increase our first-time fix rate to 80%. The teams did a phenomenal job last year, and actually beat both of those metrics by high single digits. We see that continuing through this year as well. We feel that these are extremely valuable because not only does it put our technicians in front and offer that resident experience to the resident, and they're able to fix it the first time, it also allows us to show up with our technicians at a controlled cost and use the parts in the truck that are procured through our procurement channels. You know, really benefiting that and adding value to the cost to maintain. Lastly, you know, IT has helped us develop and deploy some really meaningful programs and strategies across the portfolio that have helped us gain efficiencies. Our latest is Field Services, which is a smart routing platform, which you're actually gonna see a demo of downstairs later today. Essentially what it does is it leverages our algorithms and takes our type of work and matches it up with the skill, the availability, and the location of our technician. Every day, it optimizes all those work orders on the calendar to give the most efficient route for each technician. We've launched this program a few months ago across the portfolio, since we've done that, we've seen our occupied technicians visit 12%-13% more homes per day. We feel like we can get to 20%-25% more homes per day. What that means, you boil that down, it's one additional home per day, per technician. We have 100 technicians, almost 100 technicians across the board on the occupied side. That's almost 100 additional residents that we can service on a daily basis. Again, really meaningful strategy and really helps control that maintain. Reshma. Hi, everyone. Am I on? I am on. You know, Kevin talked a little bit about our culture, and one of the things we also have here is a culture of innovation. What I'm gonna do is to set you up for the tour you're gonna take later today. I wanna give you a little bit of kind of a foreground on what you're gonna see. Alan mentioned some of it, Bill mentioned some of it, Connor mentioned some of it. What we've done is made some real strides over the last year with some intentional innovation. We strive for scalability in the platforms that we create and deploy. We strive for cost efficiency, and making sure that our operations teams can operate more efficiently, as Connor just mentioned. We strive for improved customer experience. We want our residents to know that our technology will help them enable their living experience to be elevated. We strive for really data-driven types of approaches. What I'm gonna what we're gonna show you more later today is some of the progress we've made in each of those areas with some of our technology. For instance, you'll see Triad, excuse me, which stands for Tricon's Acquisitions and Dispositions platform, the 2.0 version. What do we do there? We actually optimize it to build in a lot of workflow automation for the transaction coordinator process that was previously manual, happening outside of the system. That enabled us to increase the number of homes that we can close much faster, and Bill will talk a little bit about that downstairs. We've also improved our underwriting and leasing system, our Tripod system, which is our, also acts as our CRM. It's now a much more efficient platform. Instead of one big, giant behemoth application, it's a set of services. We've improved it in a number of ways. We've actually processed over 1 million prospects through it. We're gonna show you a little bit about how we've also scaled our self-show process through Tripod, as well, and you'll see a demo in innovation lab. On the repair and maintenance side, just to increase or just to talk a little bit more about what Connor said, the Field Services platform is something that we made a concerted effort to deploy late last year and through the first quarter of this year all through the occupied technicians in the field. What that did is it also enabled us to integrate that to our Resident App. Imagine now residents can see where your technician is, when they're gonna arrive, the estimated time of arrival, schedule the work order, and get all the information they need in a single application, which we'll demo later today. What Alan's gonna talk about is the call center improvements we wanna make. You probably heard about the intelligent virtual agent we've been utilizing for quite some time. Voice technology, thanks to AI, has made a lot of strides. What we're doing is we're actually now, kinda taking voice technology a step further. Moving intelligent virtual agents from the phone to now integrated on your cell phone, experiencing, you know, the web chat all real-time. As a prospect is talking to us about the home they want to tour, they'll get an application link right on the phone. They'll get a link to the website so they could schedule it all in one single experience, thereby hopefully enabling, you know, a much more elevated prospect experience as well. Finally on the app management side, Bill mentioned that we are releasing actually just this week, our first revenue management platform that's built on Tripod technology. I mentioned the cost effectiveness. A lot of this is built on platforms that we've reused for other things. Tripod is built on the technology platform for the revenue management system. Triad has the same technology platform that we initially launched the beta app through. The idea is that we can scale because we've, you know, been intentional about the architecture and the innovation that we're implementing here. Next slide. I mentioned wanting to take a data-driven approach. We are starting to explore machine learning and AI, and that's not coincidental with, you know, all the hype in the news these days about ChatGPT. This has been a multi-year strategy. It's something that we can now this year talk about really for the first time. It's been something we've been working on for several years. What I mean by that, and what's not gonna be evident in the demos, but is there, and it has to be there for us to be able to take advantage of this, is we've been, you know, developing a data strategy, a data analytic strategy for a couple of years as I, as I mentioned, underpinned by a solid infrastructure, tech infrastructure for our data warehouse. In addition, we've been very disciplined about our data quality, about the data governance. The reason we can explore opportunities to move from what we are doing, you know, in the descriptive and diagnostic analytics, you know, what happened, why did it happen, into now predictive analytics with machine learning and AI, is because we've taken that disciplined multi-year approach of the data quality. Clean data, you know, coming in, clean data staying in. Being able to explore opportunities to perhaps look at, we know, HVAC failures because we can now take the IoT data in our homes and, you know, look at set points being, you know, taking way too long to achieve, right, in certain homes and send a technician out. We can look at IoT data to see if we're gonna get, you know, someone possibly skipping, you know, on a delinquency because they're using the lock less than they were using when they were in the home, right? We can now start to predict, you know, things like even large repair costs and, you know, based on a number of different variables determining what correlates, you know, large repairs. That's the type of exploration we're doing today. You'll see some of that in the lab. We're also involved in a little bit of the hype in that we took ChatGPT, got a subscription for it, and we're learning to model or train the model with just very generic Tricon data. Just see, you know, how seamless could it be so that when Microsoft fully deploys it in their platform, which we happen to use as well, we can be ready to take advantage of it, right? Imagine a one-line CRM, potentially, where you just ask it a question, and it knows everything about our data. We're playing with those kinds of things now as a result of the investments we've made and the discipline we've had with our data over the last several years. Next slide. Then finally, the Resident App. Last year, we showed you some mock-ups of our beta Resident App. We ended up deploying that at the end of last year. I'm not gonna steal too much of the thunder in the tour, we got some tremendous feedback from our residents. They were very excited about using this. It is a one-stop shop kind of app, right? In our industry today, you may have to have, as a resident or renter, multiple apps to pay your rent, to control your smart home, you know, to submit a work order. What we've done, again, this is as a result of kind of intentional innovation where, you know, we wanna use open architecture, not prop tech, you know, that's really closed, and we're not allowed to get access to the data or the technology and integrate it, right? All of our smart home can be integrated to our Resident App now. Paying rent and using different, you know, potential vehicles like PayPal as a flexible option for renters is something that we're now gonna be integrating this year. Submitting the order and then making sure that the Field Services, you know, application is integrated so that the resident sees real-time updates on, you know, the status of their work order. You know, the ability to get notifications from us and also to be able to, you know, track, you know, progress of previous work orders and see a whole history is now gonna be baked in. We'll show you a demo of that in the innovation lab as well. Thank you, Reshma. Questions for Reshma, Alan, Connor, Bill? Hi, Bill. Hi. I guess question maybe more for Bill, though. Thank you. question maybe more for Bill. Come on up here, Bill. I was curious. Some of your peers have outlined an expectation for a jump in CapEx and turn cost this year as residents who've been in their portfolios longer are expected to move out, and that's driving higher costs since they've been in there for so long. I guess I'm curious, are you seeing or expecting that trend? Then I guess maybe remind us what your overall expectations for turnover are this year. You wanna take this, Alan? That's an Alan question. Alan, maybe. You wanna take the turnover and I'll do the rest of it. Yeah. I mean, our turnover's been just abnormally low, right? It's up 20% in the, in the low teens, right? That's really interesting for our business. Again, I think that's part of that lock-in effect. That self-governing of rents. I don't know if you wanna take the cost gain. Yeah. From an occupy perspective, we believe that our cost maintainable just level out. We're probably of mid-digit, single-digit growth on that. We're actually seeing our turn costs come down, but there's a small bit more turns coming through the system. We've seen an 11% decrease in our turn costs over the last two quarters, and we're actually doing more of the work in-house. We feel very comfortable there. But again, I think the guidance is that'll be mid-single-digit growth from a cost maintain this year. not more One of the interesting parts is that we're at 98% occupancy. 98% of our rent's billed in March. We collected in March. Like we manage our residents pretty tightly. Most of our residents we're working through. We're getting back into their houses. We do inspections on their houses on a regular basis. I'm less worried about it this year than I was last year. Question back there from Adam. Yeah. Just going back to an earlier slide on rental supply of rental homes in Tricon's markets. Maybe you can kind of comment that it seems like it's reverting back to pre-pandemic conditions, but also appears to be stabilizing. Just wondering kind of what whether it's just kind of the chart here dips and then, you know, maybe kind of visually looks like it's stabilizing. If there are other kind of data points you can share again, that kind of shows that, you know, there won't be kind of further supply, shadow supply, whatever you wanna call it, that's gonna kind of continue to hit the market? Yeah. No, it's a good question. I mean, we look at it every day. You know, I think, you know, one of the key trends that we look at, you know, again, we're balancing supply and demand each day, and we look at how many people come to our website and look at our homes. We turn a lot of our applicants away. More than 50% of them, we deny. As you see this big pop that happens in February, I think that's just simply due to people waiting through till after the Super Bowl, they start looking again. They've got time to go look for homes. We scoured the trends. We couldn't actually see any meaningful, you know, kind of macro influence. There could have been some small, slight adjustments of prices or homes we bought, you know, kind of in at the peak of, say, last year. Then we were looking to rent those through, you know, kind of the Q4 period. Then as you kind of got through a better period of time in terms of demand in February, it started peaking up, as people started to move again. We don't have any other, you know, specifics that we can give guidance into March. I'd love to. Mario. Maybe a quick one for Alan. The in-house maintenance as a percentage of overall work orders, if I recall correctly, like several years ago, that number was probably 50% or below, so you've done a really good job bringing it up to 75%. You mentioned there's some orders that you just won't do internally. What's the effective cap in terms of where that 75% can go from here? Yeah. Connor's team actually manages all this and does a phenomenal job on it. You'll see the system that we use downstairs. I think we'll probably get into the 80% range over the next 2 years. That's where we'd like to get to our available work orders too. We will never. We don't believe that it makes sense for us to replace roofs, for example. You know, we've got much higher insurance. When you put on a new roof, that roofing contractor gives us a great warranty on it that we don't give ourselves. We just don't see the value in that. Let's go to the next slide. Oh, Steve, one more. Thank you. Sorry. Just on the, on the Resident App, obviously sounds like you've had some good feedback from that from residents. Just curious, how do you view the rollout of that across your portfolio? In addition to driving, resident satisfaction, do you see the financial benefits of using the app over time? Yeah. Great question. The rollout's kind of twofold, right? We've completed the Field Services portion, so our occupied technicians are now in a position to be smart routed and respond. The West Coast rollout happened at the end of last year. All of the West Coast residents were, you know, asked to download it, and we have about 6,000-6,500 downloads, about 3,000-3,500-ish folks consistently using it. We plan for the rest of the market starting to happen in June. This next version is actually coming out next month. The West Coast folks will get an automatic Apple or Google, you know, update to their app. The East Coast folks will get asked to then download it and start using it for work order submissions, you know, to be able to get communications to us back and forth, and whatnot. That's kind of our strategy. As far as, you know, revenue, yeah, you know, Bill talked a little bit about what are the potential opportunities. Ancillary services. We have a number of different products and services we could offer our residents, but how do you get it to them in a personalized manner at the right time, through, you know, a consistent medium? That's what the app will provide us with. We're looking at the app as an opportunity to provide those personalized ancillary services revenues or services and products in a timely manner, so that we can hopefully get them to take advantage of it. Does that answer your question? Thank you, Reshma. Why don't we go to the next slide, and let's talk about growth. We will accelerate growth when the time is right. I'm gonna invite Jon Ellenzweig to kick us off. Great. Thank you so much, Wojtek. We actually had 11 more slides on property taxes we were gonna do now, but we're really mindful of time. It's in the appendix. We're gonna talk about acquisitions, which seems like a topic that we're getting a lot of questions on. You know, overall, obviously, we feel great about the long-term fundamentals of the Single-Family Rental business, but we're very mindful of where we are in today's cap rate versus interest rate environment. We're forecasting, you know, between 2,000-4,000 acquisitions for this year. What could make our acquisition pace get accelerated or go a little bit faster? A couple of great tailwinds out there. The first are the debt capital markets. We've obviously seen a lot of turbulence in financing rates over the course of the last 6-12 months. If we continue to see debt or cost of financing for our business decline, we may be able to buy a few more homes or accelerate our acquisitions. Similarly, if we see a bit of a dip in home values or stronger than expected rent growth, we could buy more homes. Interestingly enough, just a modest drop of 2%-3% In home values results in an increase of 15% or 15 basis points on our acquisition cap rates. At the same time, there's a couple of headwinds out there to our acquisition program. Higher interest rates might cause us to slow down a little bit. Similarly, a recession that could have a bit of a drag on rent growth could cause a slowdown. Lastly, flat to higher home prices might further accelerate or exacerbate this lock-in effect that we've already talked about and further reduce the volumes of homes available on the open market. Now let's talk a little bit quickly about our private investor partners. I've got to tell you, these investors, you know, have had a lot of faith and really saw this SFR as a great opportunity way back in 2018 when we launched JV-1. We continue to see interest from both our new and existing investors regarding continue to partner with us in future vehicles. You know, we're speaking with our large existing partners almost on a daily basis, and they continue to intimate to us how much they love SFR and how much they love Tricon as a manager. In a lot of cases, these investors still remain under-allocated to housing and are adjusting their own internal real estate allocations, in a lot of cases, away from office and retail and into things like housing and in particular SFR. They're really attracted to the strong fundamentals of our business. They love the fact that we're in the Sun Belt where there's very strong migration trends. They love the household formation that's going on right now among millennials. They also like our relatively short duration leases and the inflation protection offered by single-family rental. What's really interesting as well is they love the returns offered by the business. You can see on the chart on the left side of the page here. If we can buy homes at a 5.5% cap rate, illustratively, finance them at a 5.5% cap rate. Over a 7-year investment period, we're still able to generate what I would say are mid-teens gross IRRs, which are very strong for the value add strategy offered by SFR, especially when you consider that the value add is relatively light and we're going from acquiring a home to cash flowing that home within 90 days. Let's go back to the acquisition market. Overall, cap rates have widened out a little bit, but supply is extremely constrained. What you can see here is over the last 12 months, there's been a bit of a dip in home prices. At the same time, over that 12-month period, there's been a bit of an expansion in rents. As a whole, that's allowed us to expand our cap rates on acquisitions. Really what the story here is a lack of volume and a lack of listings. You can see this chart on the right side of the page that's dotted with red. It's really incredible. Listings in a lot of our major markets are down 20% or even 30% year-over-year. Again, it's all because of this lock-in effect. We pulled some data, and according to CoreLogic, 95% of mortgages in the United States today or more are below today's mortgage rate. In addition to that, the median mortgage rate in the United States right now for existing mortgages is 3.1%. 40%, of people actually own their home outright with no mortgage. There's a lot of people out there that just don't see incentive to sell their home today, which is why listings are down so much. Bill or Alan mentioned earlier as well that we're actually seeing some of those folks who wanna buy another house actually put their house on the market as a rental as opposed to selling. What are we doing today? We're staying very disciplined in our acquisition program. We're typically buying on the far edge of this box between 5.5% and 6%, but really much closer to 6% on our acquisitions. In terms of our offers, we used to offer at or slightly above where people were listing their home for sale. Today, we're offering about 6% below the list price. In addition, as a result of that, our pull-through rate has gone down. We used to pull through about 25% of the homes we were offering on. Now that's down to 13%. As a result, it's having a muted impact on our acquisition volume. We're buying about 400 homes this quarter. Part of that is seasonality. Historically, Q1 has been a slower acquisition period. I do expect that will grow into Q2 and Q3. You can see we're being very careful and very disciplined as a result of where financing rates are compared to cap rates. In general, though, as I mentioned earlier, we still have a high level of conviction on the strategy, on SFR, and on the long-term growth fundamentals. There's 131 million housing units in the United States, and only about 500,000 of those are institutionally run SFRs. Our share and that of our peers, the institutionally owned SFR operators, still remains only 2%-3% of the entire SFR universe. You can see here our guidance of 2,000-4,000 homes really is predicated on this high 5s acquisition cap rate. As you drop the cap rate, there's a major step change in volume. If we do see financing rates decline a bit, as David Mark will talk about shortly, we do see the ability to significantly accelerate acquisitions over the upcoming years. Just to pivot a bit, what we've been really focused on is our MLS 1 by 1 acquisition bread and butter strategy. I do wanna talk a minute about our new home platforms 'cause we have two great programs out there that are allowing us to buy new homes. If you ask Kevin or Alan, our residents love these homes. They come with a lot of bells and whistles. In particular, it also gives us, our maintenance team, and our residents a maintenance holiday because there's very little repair or maintenance or CapEx in the initial years after we buy a brand-new home. In our Homebuilder Direct program, we've already deployed over 50% of the capital, and we have commitments to buy homes over the course of this year that should exhaust the vast majority of the remaining capital. We're buying homes in the mid to high 5% cap rates from both large and small home builders. We are seeing a spread between where we are offering and where home builders are selling their homes. If you follow the media, you've seen that new home sales remain very strong. In a lot of cases, those are going to end users who are able to absorb these higher mortgage rates, in a lot of cases, because the home builders are offering rate buydowns or figuring out how to make that monthly payment attractive to buyers. Coupled with buying new homes, we're actually building new homes in partnership with developers through our build to rent platform. We actually have two vehicles. We're through our first vehicle, we call that THPAS JV-1, in partnership with the Arizona State Retirement System. Right now we're deploying capital in THPAS JV-2. What's really exciting is we made a number of these investments a few years ago, they're really starting to pay off. We're delivering over 500 homes in build-to-rent communities this year and expect that to grow to over 1,500 homes in 2024 and over 2,500 homes in 2025. It's also very exciting that, you know, we continue to see some stabilization on the cost side of the equation. As we look at new deals, we are seeing improvements or at least stabilization on the cost side of the ledger, that's coupled with higher financing rates. We expect our new acquisitions to be a bit tepid over the course of this year. I do want to highlight, you know, one of our new communities that's just beginning to come online. It's very exciting. It's called Twelve Bridges. It's in a master plan in Lincoln, California, which is a high-growth suburb just outside of Sacramento. Lincoln is a place with great schools, a lot of green space, fantastic access to jobs, and a lot of amenities. What's exciting here is we've worked with a long-time development partner of Tricon, called Sares Regis Group, to actually design what we would say are very modest size homes, you know, on average about 1,550 sq ft, but still pack in 3 bedrooms and 2 and a half bathrooms. We're providing a lot of bang for the buck to our residents who are beginning to lease this community. When you add everything together, we've been able to build this to a 6.9% development yield, so still offering a very good return, and that's translating to a mid-20s% IRR for our partnership with Arizona State. I'm gonna turn this back to Wojtek to talk about funding our growth. Thank you, Jon. I'm good with the mic. How do we fund our growth? Speaking of this year, the punchline of this slide is we're in a very comfortable position to fund our growth plan of 2,000 to 4,000 homes. Part of that is driven by the fact that we sold our U.S. multifamily portfolio last year. That shored up our balance sheet. Part of it is driven by the fact that we're only buying 2,000 to 4,000 homes, so it's a slower pace than typically. We think the co-investment needed for that is $80 million-$160 million from Tricon's share of the co-invest. How we're gonna fund that, about $50 million comes from our AFFO net of dividends. That's a recurring cash flow stream. The balance is essentially all coming from disposing non-core homes. We've identified 400 homes, or thereabout, this year that we're gonna be disposing of, mostly in L.A. County and Southeast Florida. These are areas that are tough for us to operate, and so we're gonna recycle that capital into JVs. Remember, every time we sell one of these balance sheet homes, we recycle that capital into 3 homes within a JV. It does help accelerate our growth. Lastly, we have available liquidity of over $700 million of cash and credit facilities that can help us go faster if the situation allows or invest in growth in future years. Let's go to the next slide. Let's talk about fees for a minute. We get a lot of questions about how our fees work and how they relate to our growth, so I wanna spend a couple of minutes on this slide. You can see in the fourth quarter, our fees annualized run rate was around $80 million. That doesn't include the performance fees, and it splits into three buckets, roughly evenly. The first bucket, asset management fees. That's just a straight percentage on third-party equity capital that we manage. What we've done in our recent joint ventures is have that fee based on committed capital, so rather than deployed capital. What that means is from day one, you start to earn the full fee load. It smooths out the fees over the horizon of the vehicle. How will that grow? That'll grow as we lay on additional joint ventures in the future. The second bucket, development fees. A little bit more volatile, partly because of the Johnson business that earns fees as a percent of lot sales that we sell to home builders. We actually thought that this business might have a tough year because of what was going on in the economy. You know, from what we're seeing so far is lots are moving. It seems like home buyers are recalibrating their expectations to the new home to the new mortgage market, and home builders are figuring out a way to move homes through incentives. That business is actually doing well. Our Canadian multifamily development business earns a fairly steady fee over the three to four-year development timeframe for any building, and we have numerous buildings going on at any one time. Building rolls off, another one rolls on. We think that's fairly steady. Then lastly, on property management fees, that bucket is more volatile, I would say. The first batch of fees is related to revenues on multifamily. $10 million of that is going away from selling the U.S. multifamily portfolio. We're gonna be earning about half a million of fees from property management of the Canadian Multi-Family Portfolio this year. The leasing fees from SFR are stable, and they grow as the portfolio grows. Lastly, acquisition fees are a straight percentage of our acquisition volumes, and that also tends to move up and down. If I, you know, think about how this is going to evolve over this year and in the future, asset management fees we think are going to grow as we add additional joint ventures. Development fees are probably going to stay flattish. Then property management fees are taking a bit of a dip this year, but we think as we get into next year, we can start to re-accelerate those through acquisition fees and as more Canadian Multi-Family buildings come online. Let's go to the next slide. You know, why do we care about fees? Fees make us more efficient from an overhead perspective. We often talk about this concept of, you know, covering our overheads. As I mentioned on the previous slide, the fee revenue was $80 million run rate in Q4. Take away those U.S. multifamily property management fees, we're at about a $70 million run rate going forward. That compares against our total corporate overhead of $110 million or thereabouts in the current year. That factors in some of the savings that we've mentioned in our, in our guidance for this year. What you have there is there's a $40 million gap between the fee revenues and our total overhead expenses, and our goal is to close that gap to 0. You, as investors, essentially get the platform for free. We think that's a very compelling and unique proposition for investors. How do we get there? We give you some illustrative revenue opportunities here that can offset our costs. This is more conceptual, right? Of like thinking about how we might get there. For example, if we were to raise another $3 billion of third-party equity capital, that could generate roughly $30 million of annual asset management fees. If we were to accelerate acquisitions, for example, by another 2,000 homes per year, that generates about $5 million of annual acquisition fees. Lastly, if we were to manage another 10,000 homes, that brings in $5 million of annualized leasing fees. That's conceptually how we can bridge the gap. Over the next few years, we're not gonna commit to a timeline here, but over the next few years, you can see that gap closing, and we think this is a very compelling proposition. Let's go to the next slide. I'm gonna end off on performance fees. This is one thing that I think a lot of you don't factor into your NAV, property management, performance fees are real. These are real. In 2022, we earned $110 million of performance fees. Over the next 1-2 years, we're estimating roughly $10 million. It's a smaller amount. It's really from some of our legacy, for-sale housing investments starting to roll off. As we get into 2025, 2026, 2027, that's where you see a more meaningful expectation for performance fees coming through. A large piece of that is from our SFR JV-1, which is maturing at that stage. You know, what's interesting about that joint venture is all the debt in that vehicle is locked in at fixed rates, which gives us a lot of visibility on what the returns look like, and it gives us a lot of confidence in that performance fee. Afterwards, you've got other vehicles maturing, as you see on the slide. All in all, we're forecasting right now $187 million of performance fees coming to us in 5+ years. That's money to fund about 2,400 homes being acquired in our joint venture. Almost a year of acquisitions coming from this cash flow stream. We think that's pretty compelling. I'm gonna pause there, bring Jon back up here and take any questions on our growth strategy. Jon. Hey. On the previous slide about the 8,000 lots to be sold over the next 3 years. On that number, is there any conservatism baked into that? I feel like the transaction market's pretty slow right now, assuming, you know, that thaws out over the next 3 years, or just some of the assumptions behind the 8,000. Stuart, that's the Johnson business. Yeah. Do you wanna talk about that? You know what's really interesting, in the vast majority of these cases, these are active master plan communities where we have home builders already in place selling homes. A lot of those lot sales are either contracted or there's already home builders literally building out those programs, and it's just a continuation of an existing program. In very few cases is this, you know, a complete greenfield piece of land that we're bringing online. Thanks. In your joint venture activities, are you restricted in any way by your current partners to adding new partners to this program? If you could max out this program, 'cause it's very efficient from a return on equity standpoint, what would be your max out capacity of joint venture activity versus wholly owned in the portfolio? On the first question, we don't have specific restrictions. Obviously, once an existing vehicle has been formed, we can't just drop new investors or in, but we are very mindful of the existing relationships that we have, and we like this club format. I could see us adding one or two new investors to a club, but we're not likely to go out there and go from a three-investor club to a 50-investor commingled fund. In terms of the balance, I would say between third-party investor capital on our balance sheet, we like both of them. We really view the third-party capital as strategic and working alongside our corporate balance sheet. We like to be able to drive NOI off the balance sheet and really complement it with third-party capital. We're an owner and operator of rental housing first and really an investment manager second. We like to keep that mix and that approach versus shifting it to be dramatically investment management. Yeah. Just to be clear, Jay, yeah, like we wanna be first and foremost a balance sheet investor. The third-party fees are there to complement it. You know, to make lives easier for everyone here and kinda driving the value of the stock, let's say, it's really, it should be tied to our balance sheet investments first and foremost. We're gonna keep that balance in check. Maybe, you know, shift it a little bit depending on the environment and depending on the JV, but, you know, rough, you should expect to see similar types of structures going forward, where, you know, we're in and around 30% co-invest in our SFR JVs, maybe a bit more, maybe a bit less. Yeah. I would say going back to the first point as well, we have had a few conversations with new investors as we think forward to SFR JV-3. You know, our budget or our business plan expects SFR JV-2 to get fully invested, I would say, early in 2024. As we see, you know, some green shoots in the debt markets and potentially pull it forward to the back part of 2023, we have started talking to our existing investors and a couple of new ones. Great. Oh, Barry? I guess similar to that. In your path to 50,000 homes, is there any upside for multi-family homes or is it gonna be through JVs? I think our expectation is it's mainly growth for JVs. As you saw earlier, you know, we've been selling some homes. For example, some of the homes we bought early on in Southeast Florida, some of the homes in L.A. County. I could see us, you know, replenishing some of our balance sheet homes that we've disposed of. I would expect the majority of the ongoing growth to be through our JVs. All right. Let's move on to the next slide. All right. We remain flexible with our debt strategy. I'm gonna invite with Wissam Francis, David Mark up here. Hey, everybody. I'm David Mark. I just wanna clarify something that Jon said earlier. My presentation will not talk about how financing rates are coming down. They will talk about how financing works hand in hand with acquisitions to enable our growth platform, right? How does our financing program smooth out some of the bumps in the road that are ahead in 2023? Let's start with the obvious. 2022 was a really volatile year, right? It was bumpy. 2023 is pretty much gonna be another rollercoaster year. Okay? Over the next couple of slides, we'll show you how our financing program is set up to deal with some of those bumps on the rollercoaster. Let's start with our debt capital structure. We are primarily a fixed rate borrower. At the end of Q4 2022, we had 71% of our debt in fixed rate loan facilities. We use floating rate debt to buy homes, to renovate them, to lease them up, and to pool them until we have enough to convert them into a fixed rate loan facility. We typically do not hold pools of homes in floating rate facilities. You'll see over time that our percentage of fixed rate debt increases. It went up from 69% to 71% last year. As we continue to grow, we cycle through our floating rate debt and we convert it to fixed rate debt. That percentage of fixed rate debt should grow over time as we continue to grow. We have a small slug of floating rate debt that we keep on the balance sheet, essentially to diversify our lending sources and to take advantage of any decrease in interest rates should that happen. Let's move on to the next slide. Charlotte, thank you. We mitigate our floating rate debt from interest rate increases through hedges, primarily through interest rate caps. You can see on the chart there that two of our hedges at the end of Q4 were pretty maturely in the money, which limited our interest rate exposure on the warehouses for SFR JV-2 and for SFR JV-HD. The other warehouse there, the SFR JV-2 term loan, is in the money right now, as of Q1. On the right-hand side there, you can see that in Q4, we saved approximately $1.6 million because of our interest rate cap hedges. If you sensitize interest rates, and let's say you say interest rates are going to increase by 100 basis points, you'll see that our hedging program really effectively hedges out 50% of that increase. The top line there, at a 100 basis point increase the interest expense or the interest cost would go from $27 to $29.2, so a $2 million increase. Yet our interest expense that we book, net of our interest rate caps would only go up by $1 million from $25 to $26. Right? You know, we expect these savings to continue through 2023, pending prevailing interest rates and the maturity of the caps. Let's move on to the next slide. The other thing that's important to manage, kinda cycle through the rollercoaster bumps that we're gonna see this year and next year is our debt maturity schedule. I talked to a lot of you guys last night and you guys were grilling me on this. How I wanna present this is more based on pool strategy versus year. Okay? On the debt side, we look at our debt facilities strategically by pool, not necessarily by maturity. If you take the $163 million in 2023 and the $280 million in 2025, those are related to our SFR JV-2 and our SFR JV-HD JVs and the investment programs there. We expect those investment programs to wind down towards the end of this year and refinance both of those slugs towards the end of next year or early into 2024. The $220 million in 2023 and the $358 million in 2024, those are related to assets that Tricon wholly owns on our balance sheet. Our strategy there is to take those two pools with a pool of unencumbered homes that we own on our balance sheet and to optimize those and refinance those, either when interest rates are better, in sort of the last half of this year or the early part of next year. You can see that most of our refinancing risk is mitigated. We've already talked to our lender on the $220 million maturity this year to extend it, and we're working with lenders to provide a short-term extension or a bridge on 2017-2. A lot of that refinancing is going to happen towards the end of this year, early next year, when hopefully we'll be in a lower interest rate environment. Let's go on. Okay, so what's the interest rate environment now? I think most of you guys know you can see the graph there that 2022 was a year where interest rates increased like we've never seen before, and we had a bit of a freeze towards the end of last year. First Key was really the last, you know, real comp that got done in November. It's not on this chart because the leverage wasn't actually high enough to take it to an E-E2 tranche. That deal priced at a 250 spread and a 6.5% overall interest rate. We've had two deals close this year, Progress and Amherst. They indicated a 175 basis point spread and a mid to high 5% interest rate. There's definitely a bit of a thaw in the market. You know, being from Toronto, we've also seen some snow on the ground, and I would say that there's probably a little bit of snow in the market right now too. Most of you know that Progress was marketing a deal last week and they pulled it on Friday. What we've heard about that is that the investment-grade tranches up to the mid 60% range were well sold and subscribed. If you impute like a 60% leverage on those tranches, it worked out to about a 220 spread and a 580 all-in interest rate. That comp is still really good. What didn't work for Progress was their sub-investment grade tranche. Like their F tranche, it had trouble selling, and that gapped out pretty wide, so they decided to delay the deal. Let's go to the next slide. How does that comp relate to what the next securitization would look like for Tricon Residential? Well, like I said, Progress Residential was fairly inflexible in that they needed that higher leverage. I think Jon Ellenzweig put up a slide earlier that showed a matrix of our leverage and our returns. Tricon Residential has the advantage of being very flexible with our leverage structure. We can be very reactive to current market conditions in terms of either pricing or structures that are offered to affect our pricing and support our acquisitions program. Let me take you through kind of where we think the market is today for a Tricon Residential deal. If you look at the highlighted columns on the left and the right side, it shows you the various leverage levels. Typically, we would go up to 60% LTV. If you go to the bottom, that would price at a weighted average rate of between, you know, 5.5% and 6%. If market conditions were to change rapidly, we could go down that leverage curve. Let's just take, for example, we only issued to 40% and a tranche, you know, an A tranche that would price in the 5.15%-5.20% range. You know, our flexibility in the structures and our LTV gives us an advantage when it comes to being responsive to market conditions and making sure that the deal is fully executed. The second leg of that, if you go to the next slide, is we have some diversity in our financing sources, and I'm sure our peers do too. We are actively in each of these 3 columns. You know, we use securitizations to typically achieve the lowest possible pricing. Up until last year, they've been, you know, 50 to 100 basis points inside of any other balance sheet lender. They have slightly higher transaction costs, and they take a little bit longer to execute. We have to be careful when we use those, what the market conditions are and of our warehouse risk between the time we buy a property and between the time we finance the property. Life insurance companies we use for long-term fixed rate financing. They typically offer a little bit more prepayment flexibility. You can get a yield maintenance period that's shorter than a securitization deal, which allows us some flexibility to prepay when interest rates come down and to refinance at a lower interest rate. They have lower transaction costs, typically half the cost of a securitization. We can rate lock a lot earlier and close the deal within, you know, six to eight weeks, which is a lot quicker than a securitization. Finally, the traditional banks, we use those for short-term floating rate type money that are pretty much open to prepayment. It provides us flexibility if we're, we need to optimize some pools. Shorter execution time and lower transaction costs as well for those. You can see that, you know, with our ability to vary our leverage structure and our diverse lending base, which we can go to specifically meet any requirement that we have for a pool, you know, we're able to kind of smooth out those bumps in the rollercoaster and work with Bill and Jon and Wojtek and manage through our acquisition program regardless of kind of normal market conditions. It's not gonna kind of take us through what we went through, you know, 2 weeks ago, but that was 2 weeks ago. Things change every week, right? You know, let's leave it there. I'll because I wanna save some time for questions. I know there's probably time. Wissam looks lonely over there. Feel free to ask him any questions. Let's invite Wissam up. Come on up, Wissam. Come on up, Wissam. I don't think you trust me with any of those. We're here for questions. Let's answer questions. Go ahead, Andy. Oh. Go ahead, David. Thank you. David, how do you think about the impact from regional banks on sort of the traditional banking channel that you typically lean on? You know, just basically as we think about the CMBS market, I mean, spreads have continued to widen. Mm-hmm. Just how do you think about your ability to tap into that? That even if interest rates have come down a little bit over the course of, you know, last three weeks or so. Mm-hmm. Ability to tap into different types of debt obviously is not as, you know, flexible as it used to be. Right. Right, right. The regional bank question, I mean, we do deal with several regional banks. What we found is that as people are kind of managing their funds at the regional banks and maybe transferring them to the bigger banks, we found a lot of inbound interest from the bigger banks to take up a lot of that slack, right? You know, the money center banks are have that liquidity, and they want to provide that to us because they know that the regional banking sector is really I wouldn't say it's frozen, but it the liquidity is constrained in that sector. In terms of the CMBS market, you're right that the CMBS, not just SFR, but other sectors as well are gapping out, and that has an effect on. I mean, that's what kind of her progress, I think. There was another deal in the market that was, you know, the F tranche was at plus 1,200, so they didn't get the pricing they wanted. You know, like we talked about in our, in our slide deck, our ability to move down the leverage curve and stay in the investment grade part of it really helps with our flexibility in supporting, you know, whatever cap rates we're buying in. I was gonna add just something very simple. We were at the conference earlier on this year. The market's not closed. The market is available. It is what happens is what do you really want? What leverage do you really want? The CMBS market is available. It is there for you at 50% or 60% LTV. We could play with the LTV as we wish. They told us they want bigger deals. They want to see more A tranches, bigger A tranches, bigger B tranches. That's again, that's right in the sweet spot that we want. And if we look at what we're actually trying to do is we're trying to diversify our sources to begin with. Securitization is just one way to do it. We recently did another Life Co. deal. We closed that one a couple weeks ago. It was a 60% LTV, 5.95% all-in rate, fixed year for five years. You're not gonna see that in the slide 'cause it's a Q1 item that will... It's in a small number anyways, but that kind of gives you a percentage that we can do deals. The last thing I just wanna mention is there's something called relationship lending. You've heard about it. It's real. We've talked to many people, and if you have the right balance sheet and you've been very loyal to your bank, they'll reward you in return. When you need something back, they'll do... You'll- This slide here, we've In the last year, we've done, you know, 2 securitizations, 2 Life Co. loans, and a traditional bank loan. We've been in each of these, you know, columns over the last year, and they're still, they're still open for us. Great. I think that last question touched on some of what I wanted to get into, obviously the availability of the different debt sources that you have access to today. Maybe building on that. I guess, just give us a sense of... You don't seem too concerned about having half of your debt maturing here the next 3 years. Sounds like you have certain conversations underway. Maybe give us a sense of... Or maybe when should we expect to hear some news on that, and what do you think longer term about your debt maturity profile? Are we gonna see something a bit more laddered after we get through this next couple years? If you have David Mark working with you're never concerned. He gets stuff done. If you look at the schedule. Let's go through the schedule year by year. 2023 is already done. The $220 million is already refinanced, so that's just an extension at our option that will be re-extended over the next 2 years. No interest rate risk there in terms of the spread. Right. Right. The next one is the as we talked about the JV subscription lines. We use subscription lines in lieu of equity. Instead of calling equity from our JV partners, we create a subscription line that is secured by the equity of the partners, and you typically then It's just for timing of cash, and you'll call back that equity to pay off that subscription line. You get into 2024, which is our 2017-2 maturity. We've already spoke to a bank to have a backstop to allow us to extend it by 1-2 years if we need to. Hypothetical scenario is at the end of this year, the rates aren't there, we can't do a securitization deal, we could extend it by 2 years. That speaks to just the next 2 years. 2025, those two items that you see up top, those are all again, acquisition facilities. As we buy, as we close off JV-2, we'll look at refinancing JV-2. Worst case scenario is you keep it where it is, and you have between now and 2024, end of 2024, to do a securitization deal to take that out and then term it out on the long-term deal. Yeah. Look, I think if you're confident that your financing sources are there for you and can provide liquidity, it's more important to have the flexibility. It's actually not a bad thing to have some flexibility with some maturities rather than being locked in for five or six or seven years on a fixed rate deal and not having the opportunity to be agile and nimble when the market moves, right? All right. Why don't we keep moving? Thank you, David. Thank you, Sam. Let's go to the next slide, please, Charlotte. Adjacent businesses are a meaningful source of value creation. I'm gonna invite Andrew Joyner and Andy Carmody up here. Go for it. Hi, everyone. My name is Andrew Joyner. I run our purpose-built rental platform up in Toronto. I wanted to give the group a quick update on our activities north of the border in Toronto, our home market. As you know, in 2016, Tricon was one of the first movers to enter Toronto's purpose-built rental market with scale, with the goal of bringing U.S.-style, high-rise, highly monetized, professionally managed rental apartments to the market, which was a value proposition that was unique. People generally hadn't built rental in Toronto from the 1970s through 2016. Fast-forward to today, we're the most active developer and operator in the marketplace with about 5,000 new units under either lease-up or active development that will be coming online over the next three years. We continue to grow with a joint venture with Canada's largest pension fund, Canada Pension Plan Investment Board, that we're able to do in a balance sheet efficient way. Wanted to hit on three themes over the next few minutes. Firstly, speak about the operating fundamentals that underpin our business that are on full afterburner. Some of the unique capital market considerations in Canada, our transformative 2023 year ahead, and then speak about some of the value that we'll be creating for Tricon as these properties come online. With respect to demand fundamentals, Canada led the G7 in 2022 in terms of population growth. We added about 1 million new people to the country, and Toronto continues to be the, you know, singular largest beneficiary of that. You know, we have demand for about, you know, 200,000 new units from all these, you know, immigrants and just natural population growth in the city. We're only adding about 30,000, 25,000-30,000 new units annually. About half of those end up in the renter pool, but we are building far, far, far too little rental supply. Estimates suggest that we actually need to be adding more than double this, about 30,000 new units annually over the next 10 years in order to meet this demand. You know, we don't see these signs of demand abating. We, we've got a situation where, you know, home prices were quite high to begin with in Toronto, and with higher mortgage rates, we're seeing more renters and for longer. The proof is in the pudding. We've got a vacancy rate of about 1% for new product in the city, and market rents that are well above 16%-20% north of pre-COVID levels. There's also a handful of quite unique capital markets considerations in Canada that are somewhat structurally different than the U.S. Firstly, valuations in Toronto are really supported by a complete dearth of investable product for new apartments. You know, there's very few apartments that have been built. Institutions love to own this type of product. The inflation pass-through for rentals in Toronto is quite unique versus other asset classes. Cap rates have held pretty firmly around 3.5% even over the last year or two with higher interest rates. I'd be lying if I said there's been a lot of price discovery. Even recently as last week, there was a large $200 million asset that traded for a 3% cap. Valuations are holding well. We're able to develop to about 150 basis points spread to those levels of about 5%. I think when you compare that to financing rates, we're still able to borrow 10-year money in Canada at about 3.8% from CMHC, who's our GSE equivalent. It's quite a different story north of the border in terms of financing rates, which are really helping to support valuations. As I alluded to earlier, we restructured our joint venture with Canada Pension Plan as well last year to an all-equity structure, which completely takes away any interest rate, and, you know, capital market, debt capital market challenges or choppiness, with what we're doing on a go-forward basis. In addition to that, Tricon reduced our co-invest in the vehicle down to 5%. we're able to, you know, continue to look at opportunities, again, in a balance sheet efficient way, but also, you know, avoid some of the choppiness that's out there in the debt capital markets. I'd also say that, you know, one of the, the great things about, you know, us and the relationships we've built doing strategic projects with government over the last few years is we continue to be a partner of choice. All three levels of government are talking more and more about a need to build rental in Canada, in particular Toronto, and we continue to be a partner of choice. 2023 is a big year for us. We are gonna have three projects in active lease up. The Taylor, which we launched in October of last year, is performing exceptionally well. We're tracking about 3.5 months ahead of our absorption schedule, and rents at about $4.50 per square foot, so well ahead of our underwriting. We're also delivering 2 other projects this year. Canary Landing, which is 770 units, immediately adjacent to the Distillery District in downtown Toronto, as well as a project called The Ivy, which is in the Discovery District, right by our universities and hospital network. We're super excited about these. You know, I think this is really gonna be a transformative year for us, we're delivering these projects into a great market. In addition to that, just given our growth, we're working on a Make a Splash campaign in the city too, to really project our consumer-facing brand in the city and help, you know, drive some successful lease-ups. Next slide, please. Bringing this all together and what it means for Tricon and its shareholders. These projects in total represent a quite significant portfolio in terms of gross asset value. As these projects deliver over the next three years, we expect this portfolio at 100% gross asset value to be conservatively valued at about CAD 4.2 billion or $3.2 billion. Tricon's share of that, backing out the debt and adjusting for our percentage ownership today on our books is about $243 million that we project to double over the next three years and translate to about $1.75 per share as these projects continue to come online. It's an exciting year ahead as these, you know, three projects deliver, and we've got about two delivering per year over the next three years. You know, again, we expect this to represent about $1.75 per share for Tricon shareholders. Thank you, Andrew. Any questions for Andrew on Canadian Multi? Is there a goal at some point to try and tie this up and monetize it in an efficient way for Tricon shareholders? How are we thinking about the long-term goal strategy for it still a lot of different parts of it? Yeah. I think the goal is to continue to own this in a balance sheet efficient manner. As I alluded to earlier, we've already reduced our co-invest in go forward deals with CPP to 5%. you know, we'll continue to look at ways to own this and, you know, continue to do that in a balance sheet way, whether it's on new deals or existing assets. All right, let's bring Andy up here to talk about residential developments. Terrific. I'm Andy Carmody. I know I had a chance to talk with many of you last night. I lead our US residential developments business, which includes our legacy land and home building portfolio, as well as our new build to rent endeavors, and also head sustainability for Tricon. I find it interesting, no icebergs on the US development list here to show. In fact, there's nothing below the surface. This business, Those of you who've known us for a long time, this is the old THP land and home building business. There used to be a lot of storytelling and explaining about what was happening here. I'm really pleased to say that that's not the case anymore. This business is really now a stable set of development projects that are generating recurring and relatively stable distributions back to Tricon on a fairly regular basis. Over the last. By the way, we're not putting any additional capital into this business now. I think we've been investing that for some time. It really turned and applied our expertise away from for sale and merchant build housing, which we'd been in for 35 years, toward build to rent. We're continuing to use our expertise, but using it to serve the income side of Tricon's business now instead of the old merchant build business. In terms of what we're doing, harvesting capital, harvesting cash. We generated $240 million of net proceeds over the last five years and are projected to generate another $265 million over the next five years. As I said, not a lot of surprises here. These are generally, I'll talk about them in a minute, generally long-term projects that are now building annual phases of development and sales on a fairly regular basis. If you were to turn that capital then into additional investment in our single-family rental platform, that's enough capital to buy about 6,700 homes over that time period. It's a nice source. You know, it's sort of embedded in our source of capital, but it's kind of a nice source of capital to grow the long-term business as we work our way out of the old land and home building business. If we turn the next slide, what are these projects? We've talked about them for years. Largely, well located growth market, path of growth locations, many of which, in fact, we feature several of the large communities are what we call master-plan communities. These are many products, multi-phase, multi-year projects that are 8-10 years typically in duration. As you see on the page, we're about half or more done in all of the large remaining projects, which means it's largely a turning of the crank, if you will. Demand, by the way, I think Jon touched on this earlier. While we entered the year quite concerned on the for sale housing demand side. Demand has come out of the year much more robust than we thought. In fact, in our existing communities are tracking about the same volume of sales as same time last year. Last year was the best year we've ever had in this business. Today, so far this year, demand is quite robust. We're not counting on that continuing through the year, but we'll take it. It looks like this business is gonna perform well. Thank you, Andy. Any questions for Andy? All right. Stay up here. Let's go to the next slide. We believe in responsible and sustainable growth, so Andy's gonna lead us off on this section. I needed a hat. I needed to change my hat between sections. In terms of sustainable growth, I'm not the only one here. For those of you who've followed along closely, ESG has obviously become a major priority in the private capital markets, publicly, broadly in the media and more so on the public side as well. We started what we call our ESG journey three years ago, in laying out some roadmap and some objectives. Over the last 18-24 months, we've really matured that program into a clear set of goals and objectives that are centered around four key initiatives: our people, our residents, our impact, that's our fancy name for the E, the environmental impact, and governance, which is table stakes, and Dave will talk a little bit about that here today. We're really focused in this project on having real impact under ESG. More importantly, we set out... You know, depending on your view, there's a little bit of BS in this sector, right? On ESG. There's some greenwashing, there's some pretending. We decided very clearly when we set on this program, we were not going to do this for lip service, and we're gonna have real impact and design a program that was both impactful on E, S, and G and impactful to our company. We're not greenwashing this and are focused on key priorities here that make a difference in our business. The first is our people. Kevin talked about that earlier. It is the fuel and Sherrie will more... is the fuel that runs this business that allows us to make the right decisions to serve our residents and to do a good job that leads to our remarkable retention, low turnover, and the many things we've talked about. Attracting, developing, engaging, and growing the talent in our team is a key set of priorities around our people. Right? Really focusing on the social impact of our own team that then leverages what moves on to residents. The resident component is also a place we've made very significant commitments on the Resident Bill of Rights and our Tricon Vantage program, which provides a suite of services to any Tricon resident to improve their financial wherewithal and ultimately be in a position to buy a home one day, which we will actually help them do if they've been a resident with us for five years. These are meaningful programs that have meaningful social impact on our people and our residents, also are good for our business. I just wanna relay that is a major priority in this program for us. Lastly, and I'm gonna expand on this in just a second. The E part. We believe our sense today is that the environmental impact, energy consumption, carbon footprint will ultimately become the strongest focal point in the ESG movement. It seems to us that it's a lot of social activity and, you know, some window dressing that will probably fade, ultimately, we're going to have to be prepared to demonstrate meaningful reduction in our carbon consumption as a business in order to remain in good standing across the investment community regulators and the public at large. The challenge we face here is 98% of our consumption is in our single-family residential portfolio. That's distributed across 36,000 homes where we have no control and no visibility whatsoever. When someone rents a home from us, a resident rents a home, they take over the utilities and manage them themselves just the same as they were a homeowner. This sector is really at a handicap in the E side of ESG. We're not sitting idle. We're not gonna take a pass and say, "That's scope three. We don't control it." Next slide, please. What we've done is rather than take a pass or duck our responsibility, we've built a bottoms-up analytical model to simulate the energy consumption across our portfolio on a house-by-house basis. This model aggregates for each individual house what we know about its location, its size, its age, and the systems and components that are in the house to allow us to predict the energy consumption of every home in the portfolio and roll that up. We know what different components consume, what amount of energy across a typical home and in each home, and we know the source of the energy from the power company that's produced. Some regions are high hydropower or, for example, Ontario is high nuclear, very clean, very low carbon footprint, while others are more traditional sources. We now know that and can understand that across the portfolio on a house-by-house basis, which enables us, one, to know, and two, to be able to make informed decisions about how ultimately to reduce the energy consumption and our carbon footprint across the portfolio on an informed and educated basis rather than just some random basis. Thank you, Andy. Let's continue on with David. Thanks, Andy. Hi, everybody. Andy, I'm happy to continue a bit in the spirit of, yeah, your conversation. I spent a bit of time talking about how we're setting ourselves apart as a responsible housing provider and actually trying to highlight that in our public affairs messaging and strategy. You see, we read all the same newspapers that you read, and we see that the single-family rental industry has finally caught the public attention, but that attention is not always good all the time. As you know, we believe that housing can unlock life's potential. That means that we believe that families deserve to live in great homes in great neighborhoods. That's why we're trying to really make an effort to educate the media and lawmakers on the positive impact that single-family rentals make in general, and on how Tricon specifically is trying to be a solution to an acute housing problem in the U.S. That housing problem, it's just a math problem. Demand for housing in the U.S. has never been higher, but we've been under-supplying the housing market for years and years. In the 1970s, we were building something like 400,000 new starter homes every single year, and by the late 2010s, that number had dwindled down to something like 50,000 or 55,000. Population was increasing all that time, and so as a result, Freddie Mac's estimating that in the U.S., we're 4 million homes short. It's 4 million homes. This chronic under-supply problem, it's not a problem that the SFR industry created, but when you layer on top of it, rising mortgage interest rates, overall inflation, we see it. It's tough out there. More and more families are unable to afford to buy a home or being priced out of neighborhoods that offer the most opportunities for them. At a time when it's cheaper to rent than to buy, Tricon is moderating its rent increases. Over the next number of years in our build-to-rent program, we're going to be contributing, actively contributing to supply in the U.S. to housing supply. Over the next three years, we and our partners are gonna be buying and renovating or building over 20,000 single-family rental homes. What's important about all of that is that by actively contributing to housing supply in this way, by actively contributing to providing these sorts of homes in these neighborhoods, we're providing access. We are providing these families, these healthcare workers and first responders and teachers with access to neighborhoods where they have opportunity that they might not otherwise have, where they can have access to great jobs, where they can send their kids to great schools and have great opportunities. These are key determinants in people's socioeconomic mobility. We believe that they should have access to those opportunities whether or not they can afford a down payment. This is the message that we're trying to get out. These are key components of our messaging, and we think that it's important to dispelling some of the misinformation that's out there about the SFR industry. Then, of course, from that point, we can go on because once our residents are living with us, well, then we put them first in so many different ways, right? Some people have mentioned today our Resident Bill of Rights. This is a service commitment that we're making to our residents. We're promising them a quality home and a caring, reliable resident experience. We're promising them things like a right to renewal, to moderated rent increases on renewal. We're proud of these promises that we're making. We're happy that our bill of rights, which is first of its kind, goes even further than the Biden administration's, you know, more recently announced blueprint for a bill of rights. Beyond that, we're doing more and more to put our residents first to show them that we care. You heard earlier, we're continually trying to improve our maintenance call response times, to improve our first-time fix rate. These are little things maybe, but they make a big difference in our residents day-to-day, and they show in little ways, sure, that we care, but the little ways are important as well. There are, of course, bigger ways. You heard Andy talking about our Vantage program. We try to meet residents and support them in their path along their own housing journey, along the housing spectrum, right? Many of our residents, many of them are gonna be long-term or lifetime renters, but not all of them. There are a number, something like 30% of those that answer our exit surveys say that they're moving out to buy a home. If that's the next step for our residents, we wanna support them in that. Through our Vantage program, we have a number of ways in which we support them in that. We have, as Kevin mentioned earlier, we have credit builder programs, so their on-time rent payment will help improve their credit scores, help them qualify for a mortgage down the road. We have financial literacy programs that these are free and provide tools so they can manage their own finances, build their own wealth. We have our Resident Down Payment Assistance Program, where if the next step for our resident is to buy a home, and they've been with us for five years, we'll help them with their down payment. We wanna meet residents wherever they are in their housing journey and set them up for homeownership if that's in their future. I see that we're running on time. I'll leave you with this. Thank you, David. Can I leave you... Yes. Can I leave you with this? Please. You can say it with me, Wojtek. Truthfully, we believe that we do single-family rental better, that we care more, and we're proud of that. We don't shy away from that. We lean into that in everything that we do. Our employees know it, our residents definitely know it, and we're trying to make sure that the rest of the world knows it too. I'll pass it on to Sherrie now to talk about how we put our residents first. Okay. Thank you so much, David. I'll go a step further and say I don't just believe we care more. I know we care more. As Gary mentioned early in the program, we are definitely seeing a change in the economic environment, certainly from the last time we met, and with it, a real change in our labor market too. While strangely enough, the labor market remains very strong, we're seeing a definite shift from attraction to retention. The best way for us to control our costs on the labor front is to make sure that we retain the workforce that we have. Who would like to guess number 1 reason people leave companies today? Anybody? Anyone feeling brave? Money. Money. Excellent guess. Excellent guess. Number 2. What's number 1? Work remote. Work remote. Another excellent guess. Top five. Last guess. Kevin, how's the guess? Come to work for Tricon. Come to work for Tricon. That is an excellent guess and probably gets like 0.5 up there in like the 1-5 score. The number 1 reason people leave companies today is growth and development, career opportunities. The best way for us to spend our time on the people side of things is making sure that we focus on learning and development opportunities, and we do that through our very own Tricon Academy. We have 3 major initiatives that we are focused on this year, all through Tricon Academy. 1 is adding, by the end of this year, 2,000 courses. Some of those will be curated content, some of those will be created content, but 2,000 courses that people will be able to take advantage of. The second initiative, it is quite likely that I am the only person in the room that is this excited about this initiative, but I understand what it's gonna do for our employees, and that's the transition from competencies to skills. Competencies are things like teamwork or collaboration or innovation. They're great north stars, but what they don't do is they don't tell the employee, "What do I need to do differently tomorrow than I did yesterday? How do I actually prepare to get promoted when that position comes along?" As we transition to skills are very prescriptive. They're very descriptive. They say things like, "How do I install a garbage disposal or know how to install a garbage disposal, or know how to lead a team of 500 people on a global workforce basis through a major change initiative?" Those are the kinds of things that people can actually attach to, and it gives somebody something to do tomorrow that they couldn't do today. They will then connect to all of those learning opportunities within Tricon Academy, and they will have the opportunity then to have internal promotion and growth and career opportunities, which will 100% keep them at Tricon. Thirdly, we're starting our very own maintenance tech certification program. As many of you know, maintenance tech's definitely core of our business. We have 110 or so maintenance techs today. Very important for them that they have those growth and development opportunities also. They will be working through 4 different levels, 6 different disciplines. Things like HVAC and drywall hanging and plumbing and things I know nothing about. They will have the opportunities to work through all of those. This will help us not only internally, but eventually, this maintenance tech certification program will be a branded program externally, and this will start to have value and start to brand Tricon externally. As we move on, one of the things we are most proud of is our Great Place To Work certification. We've been certified now 3 years in a row. We had 88% satisfaction score. That's 88% of our people who said Tricon is not just good, Tricon is not just good enough, Tricon is a Great Place To Work. We're also incredibly proud. We moved our participation rate from 38% to over 80% this year. That's 88% of 80% of our people who said Tricon is a Great Place To Work. If that is not good enough, 794 people made specific comments. Not only did they check the box and fill out the whole survey, they actually spent time to tell us what they really like about Tricon and where they want us to improve. We use that to be able to inform all of our action planning throughout the year. We do it for the whole company, and then we also do it specifically for each department, each function. Incredibly proud of that score, incredibly proud of our workforce. We just think that when you combine our focus on diversity, when you take a look at the environment that we're trying to create around training, development, career opportunities, and then you add to this, and I think this is the most important one, you add to that our commitment to creating an environment where every single person feels like they belong, that is the best environment we have for the rest of 2023 and beyond. Thank you. Thank you, Sherrie. Back to you. Questions for Sherrie, David, or Andy? All right, next slide, please. That takes us to the end of our presentation. Thank you for your questions. Thank you for joining us. Thank you to all those online for joining us. Again, reach out if you have any other questions. We hope you found this insightful. See you next time.