Greetings, ladies and gentlemen, and welcome to the Vesta second quarter 2022 earnings conference call. At this time, all participants are in a listen only mode. A question and answer session will follow the formal presentation. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Fernanda Bettinger, Investor Relations Officer. Please go ahead. Thank you, Paul. Good morning, everyone. I want to thank you for listening to our prepared remarks second quarter 2022 earnings. Joining me today are Lorenzo Berho Carranza, Chief Executive Officer, and Juan Felipe Sottil Achutegui, Chief Financial Officer. Before I hand our call over, let me first touch on a few items. On our website you will find our press release that we posted yesterday after market close. Please note that today's remarks include forward-looking statements that are based on management's current views and assumptions. The second slide in today's presentation lists several factors that could cause our future results to differ from our expectations. While management believes that these assumptions, expectations, and projections are reasonable in the view of the current available information, you are cautioned not to place undue reliance on these forward-looking statements. Finally, note that all figures included herein were prepared in accordance with IFRS and are stated in nominal U.S. dollars unless otherwise noted. With that, I will turn the call over to Lorenzo Berho Carranza. Thanks, Fernanda. Thank you all for joining us today. As you saw in yesterday's second quarter results, Vesta achieved outstanding operating performance with exceptional leasing activity, record high portfolio occupancy, and strong financial results. This illustrates the continued operational focus of our teams to capture opportunities in today's extraordinary demand environment. This enabled us to deliver $43 million in revenues in second quarter 2022. NOI reached nearly $41 million with a 94% margin. Second quarter EBITDA reached over $36 million with an 84% margin. A pandemic, a trade war, and rising wages in China and elsewhere have forced many manufacturers to look for other options, Mexico in particular. This is resonating in the demand we are seeing with Vesta's new clients. We are experiencing unusually quick property absorption. The industrial sector's strong fundamentals continue to drive high occupancy rates and rental rate growth. We are seeing unprecedented leasing activity and renewals, and Vesta signed just under 3.5 million sq ft of GLA in the second quarter, which represented 1 million sq ft in new contracts and more than 2 million sq ft in lease renewals. This is the highest lease renewal rate in Vesta's history and a credit to our sales team's outstanding leasing success. All our new construction was leased before it was completed and delivered to the clients. We signed contracts with outstanding high credit rating companies such as Foxconn, AB InBev, and Amazon, just to mention a few during the second quarter, all of them in different industries such as electronics, semiconductors, food and beverage, e-commerce, and home appliances. Vesta's contracts are also indexed to inflation, which had favorable effect on our results this quarter, as Juan will review. Sustained demand, the uniquely favorable effect of higher than expected inflation on Vesta's results, and outstanding leasing success during the first half of the year have led us to upwardly revise Vesta's full year 2022 guidance based on our strong pipelines and resilient portfolio in a climate where availability outweighs price for our clients. Last month at our Investor Day, we increased Vesta's growth targets with an expected investment of up to $1.1 billion within our five key regions, enabling us to reach a total portfolio target of 50 million sq ft. This reflects today's positive industrial real estate market conditions with an ongoing theme of demand exceeding supply, driven by regionalization, nearshoring, and e-commerce demand. We're also seeing robust appetite for industrial assets, pushing up prices, and further compressed cap rates across markets and product types with increased interest from prospects overall. The logistics space remains in high demand and with new demand in the north of Mexico and the Bajío as non-portfolio occupancy continues to increase. Many logistics operators have taken on incremental inventories to mitigate the disruptions that weren't common previously. While in other countries there has been some signs of more moderate absorption, in Mexico we still see large requirements coming from the e-commerce sector. The Fed tightening, which began in March, has been accompanied by increasing talk of a recession. While it's certainly true that the U.S. economy faces several headwinds, none of these have been enough to stall U.S. recovery to date, particularly the positive momentum in our industry. It's also important to note that Vesta has demonstrated our flexibility to adapt to any environment. A deep or short recession would have little to no effect on Vesta, and Vesta is well positioned to manage our portfolios should we experience an extended global recession. We're protected in ways that many of our peers are not. However, Mexico's relatively lower input costs and highly productive labor force, combined with its proximity to the U.S., should support the long-term development of the Mexican industrial property market. As we have highlighted in prior calls, Vesta is uniquely well-positioned to capture additional demand and growth with our strategic land holdings and local presence. We have the strongest development growth pipeline in the industry and a balance sheet that is optimally positioned to take advantage of the current environment. With that, let me now turn it over to Juan. Good day to everyone. Thank you, Lorenzo, and good day to everyone. Let me begin with a summary of our second quarter results. As Lorenzo mentioned, we are very pleased with the strong financial results achieved in the quarter. Starting with our top line, total revenue increased 8.3% to MXN 43 million in the second quarter of 2022. This was due to a MXN 4.2 million increase from new revenue generating contracts and MXN 2.2 million increase related to inflationary adjustments on rented property during the quarter, and was partially offset by MXN 2.1 million decrease related to the property sold at the end of 2021. As a reminder, all of our lease contracts are indexed to inflation. Therefore, we continue to benefit from the favorable effect of higher than expected inflation on our top line results. In terms of currency mix, 83.1% of Vesta's second quarter revenue was denominated in US dollars, remaining relatively stable when compared to the same period of the last year. Turning our attention to our cost structure, total operating costs remained consistent at $2.6 million in the second quarter of 2022, as the increase in cost from occupied property was offset by a decrease in cost from vacant properties. Net operating income increased 8.3% to $40.7 million year-on-year, driven by higher rental revenues, while the margin stood stable at 94.3%, mainly due to higher costs from occupied properties. While administrative expenses were up 16.4%, this was mainly explained by an increase in employee benefits resulting from the creation of the pension fund retirement reserve, as well as an increase to the company long term incentive plan. In turn, EBITDA reached $36.4 million in the second quarter of this year, an 8.7% increase compared to the prior year's quarter, while the margin contracted 21 basis points to 84.4% as compared to 84.7% for the same quarter of last year. Moving down the P&L, total other income reached $73.1 million compared to $78.6 million in the second quarter of 2021. This decrease was mainly due to a lower revaluation gain on investment properties. As a result, we closed the quarter with a pre-tax income of $67.5 million, compared to $110.4 million in the second quarter of 2021. While the pre-tax FFO increased 21.9% to $24.5 million, and NAV per share increased 7.2% to $2.65 per share from $2.47 per share in the same quarter of last year. Now turning to our CapEx and portfolio composition, we invested $27.5 million during the quarter, mainly in the construction of new business in the northern and Bajío region related to the strong demand that Lorenzo has noted. At the end of the second quarter, the total value of the portfolio was $2.44 billion, comprised of 193 high quality industrial assets with a total GLA of 32.1 million sq ft and with 83% of total income denominated in dollars. Year over year, our stabilized portfolio increased 2% to 31.9 million sq ft, with occupancy increasing 95.9% from 92.7% in the second quarter of last year. We ended the quarter with a land bank of 42.3 million sq ft, down 4% sequentially, mainly due to the sale of 1.3 million sq ft of land in Ciudad Juárez. Turning to our balance sheet, we closed the quarter with a total debt of $933 million, and our cash position stood at $298 million. Net debt to EBITDA was 4.5, and our loan to value ratio was 33%. In addition, we paid a cash dividend for the second quarter of July 15, 2022, subsequent to the quarter end, equivalent to 0.43 MXN per ordinary share. Finally, as a result of our expanding leasing activity and the successful execution of our Level 3 Strategy, supported by a continued strong demand environment. We decided to raise our full-year 2022 guidance as Lorenzo commented. We now expect to achieve a 7.5%-8% year-on-year revenue growth from our previous guidelines of 5.5%-6%. We are also raising EBITDA margin to 83.5% from our previous indication of 82.5%, while NOI margin guidance remains unchanged at 94%. With that, we conclude our second quarter review. Operator, please open the floor for questions. Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment please while we poll for questions. Thank you. Our first question is from Juan Ponce with Bradesco BBI. Please proceed with your question. Hi, thank you for taking my questions and congrats on the results. The first one is on the Bajío region. If you could comment on the recovery there a little bit. We saw occupancy 200 basis points higher quarter-over-quarter. Are you seeing demand from Mexico City spill over to the region? What sectors are the new tenants in? Hi, Juan, and thank you very much for being on today's call. Definitely the strong trend on demand is overall in Mexico, coming mostly in the north part of Mexico, where we are seeing vacancies at zero per cent almost and strong demand. That has also impacted now the Bajío region in several industries and several cities. We recently closed a couple transactions in the home appliance sector as well as electronics and automotive sector in San Luis Potosí, in Guanajuato, and in Querétaro. Additionally, this week, there's the Farnborough International Airshow. Some representatives of BBVA together with some Mexican government authorities are taking part in that event and are announcing also new investments coming in Querétaro in the aerospace sector. I believe that on top of all the other sectors that we have just mentioned, it's good to hear that other sectors that were kind of cooler in the last couple years are reacting quicker and are analyzing future expansions or new investments in the region, which we believe has been competitive many years, and now we believe that will continue to be so. Hopefully in the next quarters, we're gonna see more news in this region, in these sectors. As you know, we started a couple buildings in Querétaro, just because in Querétaro we have really nothing available to lease off. That's why we see that change in demand and change in pipeline as an opportunity and therefore we want to anticipate to capture those opportunities. Okay. Thank you. The second one, if I may, if you can comment a little bit on the rationale behind the higher EBITDA margin guidance? Is everybody still working from home? Where are the efficiencies coming from? Regarding the EBITDA, sorry, Juan, thank you for the question. Regarding the EBITDA, well, we revised- What are you referring to top line? Yeah. I mean, the most important thing is our increase in revenue guidance. Revenue guidance, we're increasing revenue guidance because the continued effect of inflation on our revenues. We're one of the few Mexican companies, if not the only one, that disaggregate changes from same quarter last year to this quarter this year in various components. As you can see, lately, over the last perhaps three or fourth quarters and most notably in the first quarter of this year and this quarter, the increases in inflation are matching. It's not a big over the increases from leasing activity of empty spaces. The effect of inflation is very convenient for our company. Given the fact that inflation means people's pricing is on the upside, well, we are revising guidance. I just wanna make a parenthesis. Also, please note that our clients are paying on time. The effects of inflation are not having a significant impact on our clients' ability to pay on time the invoices that we're submitting to them. Given that fact, we increased our guidance on revenue and EBITDA. Basically, our initiatives are the same. Initiatives expenses basically this year are gonna be a little bit higher than previously due to the fact of the new pension funding provisions that we're making. I think that over time the growth in revenues are going to absorb those provisions and we're gonna get back to 84% EBITDA as is typically our case. No? Okay. Thank you very much. Thank you. Our next question is from Nikolaj Lippmann with Morgan Stanley. Please proceed with your question. Thank you very much. Thanks for the call, for taking my questions. Just two questions. Can you talk a bit about the replacement costs, sort of specifically to some of the key northern markets? I know you released a lot of data around it yesterday. Yeah, you know, the marginal, you know, or range of marginal development costs for some of the markets like Monterrey, Tijuana, and Juárez. Also maybe just address some of the issues around bottlenecks like water, electricity, and other things. You know, congrats on the momentum. It looks really extraordinary. I know it always takes a little while before it feeds through to all the numbers. Can you talk a bit about your leasing activity for the second half and into 2023, and how we should think about lease spreads for that period and for those assets? Thank you very much, and again, congrats. Sure. Let me try to clarify some of the questions. Thank you, Nikolaj, for being on the call. Regarding replacement costs, I think it's important to note that we have all seen that construction costs have increased pretty much everywhere. Mexico is not the exception. We have seen increasing costs, particularly in steel, cement, and also in land values. However, we believe that many of these costs, which could be up as high as, let's say, 40%, in most of the markets we have seen that an offset on the rental rate increase. With that, we still believe that there's an attractive yield to keep on developing. Attractive yields in the double digits range, and therefore we think that it's a great moment to keep developing. As you know, we develop a lot of spec buildings to anticipate to the potential demand. Now with zero percent vacancy in many of the markets, I really believe is the way to go. Part of the positive results that we have had is that all of the buildings that we have built and delivered are leased. You can see that in part of our supplemental package. In that regard, our strategy towards development, we believe, has paid off well. Good yields in the right markets and with great companies, which the ones that I mentioned before. Amazon, recently again in Guadalajara, now in Monterrey, and with previously in Toluca. We recently also signed a new lease with Foxconn in Guadalajara, and other ones in other industries such as home appliances and food and beverage. In the end, I think that pipeline is pretty good, and probably that takes me to one of your questions, which is leasing activity in the second quarter. We have a very strong pipeline. We are having a good momentum, and that's why we don't see that this is gonna be. It's gonna slow down anytime soon. Additionally, considering leasing spreads, we're just seeing rents increasing. It's a result of low supply, good demand fundamentals, and also I think a bit of replacement costs. In the end, we're in a great position. We're gonna continue developing, and we're gonna continue investing to do the spec's. Bottlenecks, Nikolaj, I think that there's not necessarily major bottlenecks other than the usual that we have always tried to figure out. This could be on the utility side, energy, water, infrastructure. As you know, we acquire land. We put a lot of investment, heavy investment in infrastructure, and that includes also energy. On that regard, I think that it's more on the timing effect on when we start and when we can lease up the available buildings. We don't necessarily see that there are major bottlenecks for the moment. Thank you, Nikolaj. Thank you very much. Thank you. Our next question is from Lucila Gomez with Compass Group. Please proceed with your question. Hi. My question is about energy. I would like to know if the current dispute between AMLO and the countries in the USMCA is maybe a concern that may have a possible impact for you, since it could possibly cut the development of, you know, renewable energy in the country. Thank you. Sure. Well, we're well aware of the recent requirements from the U.S. as well as Canada on the energy front and on the USMCA, let's say panel and I would call it arbitrage methodologies. We believe that like any other issue related with trade and related with third parties, we think that there can always be differences, and there's always methods to take them to certain arbitrage. We think that this falls more on the political front rather than the supply front. We definitely believe in competitive markets. We would love to see more competitive markets in the energy front so that our clients can have more competitive rates. For the moment, we believe that CFE, which is a local utility company, has been an important ally for industrial developers for many years, since they have been, for many years, let's say, the sole supplier of energy. We think that they're gonna be also an important player in the future years. They are well not investing as much as we would like to. However, they're active and they are trying to find out solutions in order to address the demand on energy that the country has had. One of the examples you can see starting industrial park or the lease of a building. There is a constant communication with CFE to see how much energy there's gonna be, when the energy is gonna be available. Additionally, Vesta puts heavy investments in energy inside of our parks, just in order to have our clients be able to connect to the CFE network. We have. We're keeping a close eye on the evolution of the recent requirements from the USMCA. However, we believe that this is more on the political front and should not necessarily affect the operations of our clients. Perfect. Thank you. Got it. Thank you. Our next question is from Francisco Suarez with Scotiabank. Please proceed with your question. Thank you. Good morning. Thanks for the call. Congrats on the results and on your tenth year anniversary for listed company. The question that I have relates a bit with the overall scarcity on water in the north. Just want to confirm that first, that I think that you are not exposed to water-intensive industry, so that might not be at a potential risk of disruption in any of your operations in the north, if you can confirm that. Secondly, on the flip side of this, it seems that the bottleneck of having land with access to electricity, which is a major constraint for many, and perhaps we can actually add the constraints on having the right properties with access to water, and that may be proving some sort of a competitive advantage for you as well. In other words, how this lack of access to electricity that we're seeing in the market and the potential lack of access to water may result in even higher rentals going forward. Thank you so much. Gracias, Francisco, and thank you very much for your participation and your question. Yes. I think that recently there has been a big debate on water issues, particularly on the north part of Mexico and more specifically Nuevo León and Monterrey. First of all, I think that it's important to note that most of the light manufacturing tenants or even logistic tenants, they are not high consumers on water. I think that creates. I think they're in a different position. They only use water mainly for services and I think sanitary services and so that's not a high demand on that regard. There's no high demand on that regard. However, having said that, I think that Vesta, what we do well is, first of all, we have rights on wells in several projects. It's one of the things that we secure every time we buy land. Thirdly, when we develop industrial parks, in many cases, we invest also in water treatment plants, mostly also coming from the water coming from rainwater that falls inside of the park and that we can use it even for other purposes. In that regard, I think that the sustainability approach from Vesta since many years ago has gone in the right direction. We have actually expressed part of our attributes on our parks to some of our local authorities. I think that on that regard we are a bit ahead than other developers or sectors. Having said that, I think that what is important is that I think that the main industries that are gonna be facing challenges are the high consumers on water, like beers and water and so on. But But most of the clients that we have on the beverage business is logistics. So there's a lot of storage of beer and water and other sectors in many of the warehouses of Vesta, but it's mainly logistics. Very clear. Thank you so much. Thank you. Thank you. Our next question is from Vanessa Quiroga with Credit Suisse. Please proceed with your question. Hi to the Vesta team, congrats on the 20th anniversary, and for taking my question. It's regarding Bajío, what's your expectation for occupancy for the next 12-24 months? We saw the improvement this quarter, which is very welcome. Do you think this trend will continue on the same pace? Thank you. Hola, Vanessa. Thank you very much for your question. We see very positive trends in most of the markets, and the way we see it is that, first of all, this will take you to the renewals. We have been renewing a lot of leases, which is a strong signal that the companies are committed in the long term. Therefore we're not experiencing any major expiring leases or companies that are vacating the buildings. That's pretty positive. On top of that, we think that what we have seen in this quarter and probably in last quarter is that definitely there's an upward trend in terms of new companies and new absorption in the Vesta. I don't There's no particular number in terms of occupancy and where we're gonna see it, but as I mentioned earlier, markets like Querétaro, we are pretty much fully leased. That's why we started a couple new buildings and we have some good potential tenants for those inventory buildings in the Vesta Park Querétaro. We have not started anything yet in Guanajuato and San Luis Potosí and Aguascalientes. We are gonna probably wait until, let's say, the rest of the year that we see really stronger signals on demand. If we do so, we're gonna be able to develop again. For the moment, we feel comfortable with occupying the vacant space, and whenever necessary, we would start building again. For the moment, I think that we kinda still take with the rest of the year. Thank you, Vanessa. Thank you, Lorenzo Berho Carranza. Thank you. Our next question is from Pablo Monsivais with Barclays. Please proceed with your question. Hi. Thanks for taking my questions, and congratulations on your 10-year anniversary. I have a question on your development pipeline. It looks like most of the projects that you are right now building are about to be completed this year. How's that outlook for 2023? Because we have not seen, I'm not seeing any project ready to start operations next year, so I'm not sure if we're gonna see this higher CapEx and then a little bit of a plateau. Or how's the GLA evolution in the near term? Thank you. Hola, Pablo. Thank you very much for your question. Our development pipeline, I think only the one that we present on the reports. We believe it's only a picture for the moment. I think that what is more important is that we have larger projects, as we announced recently in the Vesta Day, as large as $1.1 billion in the industrial parks that we're currently developing. I think that every quarter, we're gonna keep on starting new buildings as long as we keep on leasing and finalize other buildings. This development progress, I think it's important to just monitor how far we are. I think that the. What we are seeing today is, we have currently, let's say, under construction, we have some buildings that we started early this year that we're just about to finalize. We are just about to finalize leasing up. We're gonna see in some of these markets, we have really nothing available. The only thing that we have available is what we have under construction. It's great to know that we were able to acquire land. We were able to start construction. We're gonna end up leasing some of these buildings, and we're gonna start new buildings and new projects. I think it's not necessarily that every quarter we're gonna be having these same projects under construction. We monitor very well where we stand in terms of the development progress of each of the Vesta parks in each of the markets. For sure, we're gonna see in the next 18 months a lot of construction going on. Whenever we lease up and we finalize the building, I'm pretty sure that our investment committee is understanding very well the market dynamics. For sure, we're gonna be developing more. Perfect. My last question is, if you compare right now the lease-up time right now versus, I don't know, four or three years ago, have things like shortened significantly because of your showing or it's a little bit of the same as in the past? Just to take a better assessment of the time. I'm sorry, Pablo. I didn't get you. The leasing process. Once you finish, The leasing, yes. Okay. Once you finish. Okay. Building, how long it takes now and how long it took you four years ago. I think I got it. I think so right now leasing up is way quicker than before. Absolutely. I think that's a result of stronger demand in many of the markets. Companies have to make decisions quicker because of their own situation. In many cases, it's just because they need to secure the buildings. In many cases they have to lease it up otherwise, and we have been in situations where we have two or three potential tenants for the same building. That puts more pressure on the tenant and that creates more of a landlord market. Definitely, we are in a way better shape or let's say the market is in a very much better condition right now. Just by looking at the vacancy rate for many of the markets, even in the Bajío region, which is a little lower than other markets, it's like 4% or 5%, the vacancy. I mean other markets like zero percent. Definitely we're seeing a very different environment right now, which leads to quicker lease-up stages. Thank you very much. Pleasure. Thank you. Our next question is from Antonio Hernández Vélez Leija with GBM. Please proceed with your question. Hello, guys. Thank you for taking my question and congrats on your great results and your ten-year anniversary. I have just two quick questions. One is related to developments. I mean, I have seen a strong deployment of investment, but I see that you pushed back for a little month some projects in Tijuana. Just wanted to understand the reason for this, if it's related to construction, to the construction side or are there any permits getting stuck or just to get a little bit more of color there. Thank you. Thank you, Antonio. Yes, absolutely. Tijuana is a project that consists of six inventory buildings. We currently have four under construction. There were some minor delays in the first buildings and minor delays is a couple months. It's basically the reason for that is just because the first buildings regularly you'll have to deal a lot with earthworks, with certain infrastructure and that's why I think that we've had some unexpected delays on the construction. However, what I can say on the positive front is that we are making a very good progress in terms of the leasing. I think that on that regard, even that we have a couple of months delays, which is very. It's pretty common, it's fine that we're gonna be able to lease up part of a couple of those buildings very soon. Just as a result of how strong the demand is and also as a result of our commercial team's effort to lease up the buildings before they are, let's say by the moment that they are finished, no? Perfect. That's pretty clear. My second question is regarding the sale of land in Ciudad Juárez. I mean, it seems like you guys bought this land just the last quarter. I understand it was sold at a significant markup. Just wanted to understand this. I mean, was it acquired by a client or what was the process of deciding to sell land that you just acquired? Sure. This was a piece of land. We acquired a larger plot of land very close to the Zaragoza border crossing, very well located. Hopefully we're gonna start soon some new buildings. Part of the transaction involved selling part of the land to a neighbor just because of some synergies that we found with another potential company. That potential synergy involved selling part of the plot of land that we were acquiring to sell it to this company. Of course, we did it to a markup and that helps on the financials on the number, but in reality, we're gonna focus on the rest of the land to develop for lease long term. Perfect. That's really clear. Thank you. Yeah. Thank you. Thank you. Our next question is from André Mazini with Citigroup. Please proceed with your question. Sure. André, go ahead. Sorry, go ahead. Sorry, operator. Go ahead, Jamal. I'm having difficulties hearing everybody. Okay. I think I'm understanding this a little better. Thank you. Hi, Lorenzo. Yeah, hopefully this is clear. Thanks for the call. The question is on the Foxconn lease you guys disclosed. Is this lease gonna be related to EV manufacturing, so the electric vehicle manufacturing? We saw Foxconn starting up manufacturing in the USA. Of course, EVs are the future, right? All of the American automakers wanna go fully electric at some point in time. If you could tell us that lease in particular has to do with electric vehicles, and how you see the electric vehicle ecosystem in Mexico in general. Thank you. Thank you, André. Just to actually add to, we're very happy with closing the transaction with Foxconn. As you know, it's a major player in the, as you mentioned, electric vehicles, contract manufacturer, electronics, globally. It's a 100,000 sq ft facility. It's a smaller facility, however, we see a large potential for them to keep growing with us. And definitely it is related to new industries that are in the electronic sector. I don't know exactly if this one is only specific for EV, but I'm sure that there are Foxconn and many other companies are evaluating carefully, how they can be competitive in Mexico, and when it comes to Mexico, it's in different regions, absolutely. That's why I think that this was a great way to also approach the electronic sector in Guadalajara. As you know, it's one of the most important hubs in Mexico for electronics with Foxconn, with Jabil, with ADM, with many other companies. I think that this creates a great diversification for our Guadalajara project, which started with an anchor tenant, with Mercado Libre. We also leased out to Amazon, another facility in that project in Guadalajara. We leased to O'Reilly for logistics of auto parts and now to Foxconn. From that perspective, I think that's exactly what we wanna do in many of the parks that we have good diversity and outstanding high creditworthy tenants. And definitely I think that I kind of answered your question on the EV front. I think that Mexico is about different industries. Mexico is about diversification. I think that electric vehicles is definitely gonna come to Mexico in different ways. We have seen some recent news. Hopefully we can at some point announce or let's say Mexico bring something larger, more than smaller suppliers just integrating their supply chains to the U.S., which is great. However, I think it would be even greater to bring a larger facility to Mexico. Very clear. Thank you, Lorenzo. Gracias. Thank you. Our next question is from Mariana Cruz with BTG. Please proceed with your question. Yeah. Good morning, all. Thanks for taking my question. Congratulations on the results. Can you please remind us of your distribution policy and how we could expect changes in distributions in the coming quarters? Thank you very much. Can you, Mariana, can you repeat the question? We kind of lost you. A little louder. Sorry. Sure. Yes. I was asking about your distribution policy, if you can remind us about your distribution policy, how you will go about distributing distributions in the coming quarters. I believe it's on the distribution of, I believe, dividends. Yeah. Can you answer that, please? Your question is on distribution of dividends. Look, dividends Look, dividends is, it's an important topic. We have a dividend. Can somebody put that in? There we go. O-operator. Yeah. Okay. Sorry, Mariana. Okay. Around dividends. Look, dividends is an important part of the mix of returns that all Vesta offers our investors. I think that the mix of strong capital gains and some dividend payouts is very important. However, the ability of Vesta to develop properties with double-digit returns, as Lorenzo mentioned, makes us a little bit conservative on dividend payments. Dividends are important, but our ability to invest in double-digit returns is even more important. We have to balance that. We have increased dividends in the past. We have a $1.1 billion of planned investments for the future. We will be mindful of dividends. As long as our returns continue to be very high on the investment side, we will be a little conservative on dividend payments. We were paying in the neighborhood of $58 million per year. Our dividends are dollar denominated, and we pay them in pesos because we pay them inside of Mexico. They are dollar denominated. They will grow from year to year by some amount. That's all I can say, Mariana. Perfect. Thank you very much. Thank you. Thank you. Our next question is from Jorel Guilloty with Goldman Sachs. Please proceed with your question. Good morning, everyone. Thanks for taking my questions, and congrats on the decade on the public markets. The first question is around onshoring. You mentioned it as being a key driver to the leasing demand that you've seen so far in, you know, over the past few quarters. Sorry, Jorel. I think it's closer or can you try to speak a little louder? Sorry for that. Can you hear me now? Any better? Better. Thank you. Hello? Yeah. Thanks. Great. I have two questions. The first question is around onshoring. You've mentioned it as being a key driver for leasing over the past few quarters or so, and I'm just wondering if there's a way to quantify that. I don't know if there's perhaps a ballpark figure, like maybe is it 20%, 30%, 40% of your new leases that are being driven by this onshoring trend? Any color you can provide to quantify that would be helpful. Then the other question is around basically demand for land in the north, because as we understand it, there's basically not much land left in Tijuana. I was just wondering, is there, at this point, are clients or yourself looking towards non-traditional border markets in order to build perhaps, you know, perhaps a Mexicali or something along those lines, given the fact that there's such land scarcity in Tijuana? Thanks. Great. Thank you, Joel, and thank you for participating today. Definitely what we are seeing is we have not never seen before. I I mean, companies try to enter into certain markets and you got it right, they don't find anything available, and they start looking in alternative markets. Which is fine. I think that companies should at least make quick decisions. The good thing about Mexico is that it's not about one market. Nevertheless, I think that Vesta has a very strong focus into certain markets. That's why we recently announced our five main regions where we're gonna keep investing. Even if a client wants to expand in another region, that if it's not inside of our five rings, as we call it, five Olympic rings, we rather pass on the opportunity just because we wanna be very focused, very disciplined, and maintain leadership in the markets that we operate. Hopefully they look for other places which has happened in the past. If they fall into it in other objective markets from Vesta, we can help them out. What was the first question, sorry? Or the other question? Yes. I was just wondering if you can quantify the onshoring trend? Oh, yeah. that you keep track of your leasing. I just wanna know if, you know, there's a percentage of leases that are coming from onshoring or something along those lines? Sure. You know what? I don't wanna shoot from the hip on your question, so why don't you give me and Juan and Fernanda some homework, and we'll give you a little bit more detail. I think that now that we have been seeing more results and more closings on the new showing trend and it's easier to track what has happened in the, let's say, last 6-12 months, and I think that could give us some good insight, but I don't want to shoot from the hip right now. Great. Thanks a lot. Congrats on the 10 years. Thank you. Thank you. Our next question is from Armando Rodriguez with Signum Research. Please proceed with your question. Thank you all for the questions. Thank you, Lorenzo, again for executing your strategy and these are the results. I have just one question related to your balance sheet and considering this strong, really strong demand on your company and in the industry. Are you seeing maybe some changes related to loan-to-value level, for example, if you are going to need maybe more debts in order to catch up this strong demand in the midterm, for example? That's my only question. Thank you very much. Armando, good question. Thank you for being on the call. Look, it's certainly challenging to finance a $1.1 billion growth plan that we announced on the Vesta Day. That's certainly gonna be challenging. However, we have a substantial cash reserve. We still have a substantial cash reserve. We started the year with $450 million. We closed in this quarter with close to $300 million. That's substantial still. Our leverage will continue to go down in the sense that as we convert dollars into properties and the properties get value, we're gonna move the leverage closer to 31%-32%. At some point in time, however, we will leverage the balance sheet. As you know, we I believe that we have the ability to do so. There are pockets of liquidity that will offer us attractive prices to leverage, and we will take advantage of those. That's only one of the tools that we may do. As you know, in the past, we have sold property portfolios, which is another way to continue our build up. We sell properties that are not necessarily the best properties for Vesta. They are, they're just core properties for Vesta. We do new buildings which are top of the line. That makes sense in its own. We sell our properties above net asset value, which is always nice and attractive for us. That's another mechanism to finance our growth. I believe that it is very achievable to use our cash to leverage in the future and to sell properties in order to achieve $1.1 billion of investments over the next four or five years. Perfect, Juan. Thank you very much for the interesting. Thank you. There are no further questions at this time. I'd like to turn the call back over to Mr. Berho for any concluding remarks. Please go ahead, sir. Thank you. This year we celebrated our 10th anniversary on the Mexican bourse. Vesta has demonstrated our success in anticipating trends and pivoting to capture important opportunities, also in the face of an unprecedented crisis. We're progressing our stated objectives, reflected in our strong first half results and upward revision of our 2022 guidance. We remain committed to disciplined growth and to executing our Level 3 strategy going forward. Thank you all. Goodbye. This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.