Greetings, welcome to the Urban Edge Properties Q4 2022 earnings conference call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Eitan Bluman. Please go ahead, sir. Good morning. Welcome to Urban Edge Properties' year-end earnings conference call. Joining me today are Jeff Olson, Chairman and Chief Executive Officer, Jeff Mooallem, Chief Operating Officer, Mark Langer, Chief Financial Officer, Danielle De Vita, Executive Vice President of Development, Rob Milton, General Counsel, Scott Auster, Senior Vice President and Head of Leasing, and Andrea Drazin, Chief Accounting Officer. Please note, today's discussion may contain forward-looking statements about the company's views of future events and financial performance, which are subject to numerous assumptions, risks, and uncertainties in which the company does not undertake to update. Our actual future results, financial condition, and business may differ materially. Please refer to our filings with the SEC, which are also available on our website for more information about the company. In our discussion today, we will refer to certain non-GAAP financial measures. Reconciliations of these measures to GAAP results are available in our earnings release and supplemental disclosure package in the Investors section of our website. At this time, it is my pleasure to introduce our Chairman and Chief Executive Officer, Jeff Olson. Great. Thank you, Eitan. Good morning, everyone. I am pleased to announce that we finished 2022 with another strong quarter. FFO, as adjusted, was $0.33 per share for the quarter and $1.21 for the year. A 22% increase over the Q4 of last year, and an 11% increase for the full year. This increase is primarily attributed to rent commencements from anchor repositioning projects completed during the year, including ShopRite at Huntington, Uncle Giuseppe's at Briarcliff Commons, Kohl's at Bergen Town Center, and AAA Wholesale at Lodi. Our prior acquisitions of Woodmore Town Center outside of Washington, D.C., and The Shops at Riverwood in Boston also contributed to this growth. Same-property NOI was up significantly at 6.2%, primarily due to new rent commencements, higher recoveries, and higher percentage and specialty rents. Our leasing momentum was robust during the Q4, setting a company record of more than one million sq ft of new leases for the year, including 575,000 sq ft in the Q4 alone. Special thanks to Scott Auster and all members of our leasing, legal, and administrative teams for generating these record results. The volume was outstanding, but it is equally noteworthy to highlight the quality of tenants being added to the portfolio. Our assets continue to attract best-in-class retailers that drive traffic to our centers and enhance the value of adjacent spaces. This quarter, we signed new leases with Target, T.J. Maxx, Golf Galaxy, CAVA, Crumbl Cookies, and medical users, including Bond Vet and DaVita Dialysis. During the past year, we increased our consolidated occupancy from 92% to 95%, a notable growth rate following the pandemic. Most importantly, we have visibility to grow our net operating income by 18% or $44 million annually, two-thirds of which is derived from executing Las Catalinas, Walgreens at Montehiedra, Total Wine at Cherry Hill, Nemours Children's Health at Broomall, and ALDI at Bruckner. On a macro level, the shopping center industry has remained resilient in the face of economic uncertainty and higher inflation. Retailers have recognized the importance of brick-and-mortar stores and the critical role the store plays in omnichannel fulfillment. This has led many retailers to expand their store count, driving U.S. shopping center vacancy to its lowest level since 2007, according to Cushman & Wakefield, which bodes well for our ability to continue to increase occupancy and rents. Of course, tenant turnover is an expected part of our business. Notable at-risk tenants for us today include Bed Bath & Beyond, Regal Cinemas, and Party City. We are comfortable that we will generate strong backfill opportunities should any of them vacate, as our properties are in many of the most densely populated, supply-constrained markets throughout the Northeast. It is important to note that housing demand in the New York metro area, our largest market, remains strong relative to the rest of the country. A recent Bloomberg article noted that home asking prices increased by more than 10% year-over-year in Westchester County and in northern New Jersey, where home bidding wars still occur due to the area's dense population with high-earning professionals and lack of inventory. This further supports the trend we have seen throughout our suburban shopping centers, where work from home policies have resulted in more frequent shopping trips. Foot traffic within our portfolio increased by 6% in 2022 as compared to 2019. We expect this trend will continue as new anchor tenants like Target, ShopRite, and T.J. Maxx open in spaces previously occupied by Kmart, Toys R Us, and other underperforming retailers. Our goals for 2023 include achieving at least a $1.14 per share in FFO, successfully addressing the $300 million mortgage maturing at Bergen Town Center, commencing $15 million of annualized gross rent included in our $29 million executed lease pipeline, activating another $50 million-$75 million in new redevelopment projects at a 10% or greater incremental return on cost, obtaining entitlements for approximately 450 residential units at Bergen Town Center, and advancing our redevelopment plans at Sunrise Mall. We look forward to seeing many of you at the Citi conference in early March and at our Investor Day on April 18th at the New York Stock Exchange. Lastly, I am delighted that Jeff Mooallem, our new Chief Operating Officer, started with us in January. As I previously mentioned on our last earnings call, Jeff worked with me and Mark during our time at Equity One, and it is wonderful to see him hit the ground running. I will now turn the call over to Jeff so that he can share a few thoughts about his first month at Urban Edge. Jeff? Thanks, Jeff, and good morning, everyone. As Jeff mentioned, I started at Urban Edge in January, and in many ways it has felt like coming home. Not only because of my prior working relationship with Jeff and Mark from our days together at Equity One, one of the most fun and productive periods of my career, but also because I've been following the company for the last several years and already have a strong understanding of the assets and opportunities here. After one month at the company, I can tell you that the team and the culture is first class. The leasing team did a fantastic job closing out 2022, and is off to a strong start in 2023, with a robust pipeline of established retailers and new to market tenants. The development team is focused on completing some exciting projects, such as the redevelopment of Bruckner Commons and Huntington Commons, with more projects expected in 2023. I have found our property management team to be thorough, experienced, and efficiently operating our assets for the short and the long term. I have now walked roughly two thirds of the portfolio and will have visited all of the properties by quarter end. I see tremendous opportunity to create value at many of these centers, whether it be by enhanced leasing, expansions, renovations, entitlements, property operations, or selective acquisitions and dispositions. The Urban Edge portfolio is filled with large parcels of low density surface park uses in supply constrained and dense infill communities. I am most excited about the chance to unlock some of that inherent and underutilized land value. I look forward to sharing more information about our growth opportunities at our Investor Day in April. I will now turn it over to our Chief Financial Officer, Mark Langer. Thanks, Jeff. Good morning. I will discuss drivers of our Q4 results, comment on our balance sheet and liquidity, and will close with an outline of the key assumptions impacting our 2023 guidance. Our results for the Q4 were stronger than expected, with FFO as adjusted at $0.33 per share as compared to the Q4 of last year. For the full year, we generated FFO as adjusted of $1.21 per share, $0.02 per share above the high end of our guidance range. Half of this outperformance pertained to real estate tax settlements and a lease termination payment, and the other half pertained to recoveries of amounts previously deemed uncollectible, better non-cash revenues from straight-line rents, and better percentage rent. Same-property NOI growth, including redevelopment, increased 6.2% compared to the Q4 last year, driven by new rent commencements and higher percentage in specialty rents. Turning to leasing, same-property leased occupancy increased 110 basis points year-over-year, and consolidated portfolio leased occupancy increased 300 basis points year-over-year. Compared to the Q3, the same-property leased occupancy rate increased 200 basis points, predominantly due to the execution of a 187,000 sq ft lease at a vacant industrial building that we acquired in 2021 that is adjacent to our existing East Hanover warehouses. During the quarter, total portfolio shop occupancy increased 80 basis points to 84.5%. Very good growth, still at a level far below our peak same property shop occupancy of nearly 91% in the Q2 of 2018. We expect further shop occupancy growth as our anchor repositioning projects continue to come online and stimulate demand for adjacent space. One side note on our same property occupancy. Given the redevelopment taking place at Bruckner Commons and The Outlets at Montehiedra, these assets are not currently in the same property pool. Accordingly, the Target and T.J. Maxx leases executed at these properties during the quarter contributed to a 100 basis point increase in consolidated occupancy that is not reflected in the same property result. Overall leasing spreads this quarter were positive 31%. The large spread was driven by the execution of new leases with Target at Bruckner Commons, T.J. Maxx at The Outlets at Montehiedra, Golf Galaxy at Goucher Commons, and the industrial lease at East Hanover. Full year spreads realized in 2022 were 12% and are more in line with expectations going forward, especially considering our current leasing pipeline that reflects new spreads in excess of 15%. In terms of our balance sheet, we ended the quarter with total liquidity of more than $900 million, including our $800 million undrawn line of credit and total cash of approximately $129 million. We are pursuing several options regarding Bergen's upcoming loan maturity. Given the very active state of these negotiations, I won't get into any specifics at this time, but we expect to have a favorable resolution to this shortly. Looking ahead, we have minimal and very manageable maturities in 2024 and 2025, amounting to $144 million and $52 million, respectively. In terms of leverage, our net debt to annualized EBITDA dropped to 6.9x in the Q4, and we expect this to continue to decline to the 6.5x range as our leasing pipeline is converted into commenced rents. Turning to our expectations for 2023. Our initial 2023 FFO, as adjusted per share guidance range, is $1.11-$1.17 and incorporates the following key assumptions. We expect same-property NOI growth, including properties and redevelopment, to range from -1% to +2%. The midpoint of our guidance assumes a general credit loss of 100 basis points of gross revenues, or approximately $4 million, and an additional 125 basis points of credit loss, or approximately $5 million for tenants that have filed or are expected to file bankruptcy. The additional reserve covers three and a half million dollars of the $4.6 million gross rents attributable to all of our Bed Bath & Beyond spaces. This $3.5 million Reserve includes $1 million related to a Bed Bath store that had a natural lease expiration in January, for which the store is now closed. The remaining $2.5 million dollars pertains to future potential fallout of other Bed Bath locations. In addition to Bed Bath, our guidance incorporates a $1 million reserve covering 50% of our exposure to Regal Cinemas, where we have one location, and $0.5 million dollars of reserve related to Party City. In terms of collections on past amounts deemed uncollectible, our guidance at the midpoint assumes we will receive an additional $1.5 Million during 2023, which compares to approximately $6.5 million we received in 2022. Annual G&A expenses are expected to be $35.5 -$37.5 million, which compares to $40.5 million in 2022, when excluding all of the one-time related costs for the executive transition we announced in the Q4 of last year. We continue to evaluate opportunities to extract efficiencies in our operating platform in an effort to further reduce G&A. Interest in debt expense is expected to increase $11 million-$14 million in 2023, primarily due to our mortgages that are maturing during the year and the forward rates on our variable rate debt, which represents about 9% of our total debt. No new acquisitions or dispositions and no other material, capital or refinancing activity is assumed. In closing, we are grateful for the dedication and execution provided by the UE team again this quarter, and we look forward to meeting with many investors in three weeks at the Citi Conference in Hollywood, Florida. I will now turn the call over to the operator for questions. Thank you. We will now begin the 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 yourself from the questioning queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Please hold while we gather your query request. Our first question is from Floris van Dijkum with Compass Point. Morning, guys. Thanks for taking my question. Wanted to get into the the pipeline, the leasing pipeline, maybe in some more detail. Perhaps, Mark, if you could just outline how I believe most of that incremental NOI, which is actually quite substantial, is going to hit in 2024. Maybe if you can talk through the timing of when you expect that $29 million to hit earnings. Also, you know, I guess part of when you do the big anchor repositionings, there is an ancillary benefit of the small shop occupancy. You mentioned the 84% current rate lease rate for your shop occupancy, which is about 700 basis points away from your peak. When can we expect that you're gonna get back to those peak levels of occupancy going forward? Hi, Floris, it's Jeff. I'll let Mark take the details. As I outlined in one of our goals for 2023, I mean, overall, our objective is to increase our NOI by 18%. About two-thirds of that comes from our SNO pipeline, which is $29 million. Another goal we have for 2023 is out of that 29, is to activate about 50% of it this year, which is $15 million on an annualized basis. Mark, why don't you take the details? Yeah. On that, Floris, the SNO, you know, while we've given you that annual of that $15 million, $6 million will hit in 23. It starts in the Q2 and then builds commensurate with how we show the stabilization dates in our supplement. About 80% of it is back-end weighted in 23, with the start of it coming in the Q2. In terms of your question on the shops, as I said, you know, we've had good growth getting us to that 85. We believe we can pick up 300-400 basis points over the next 12-18 months, call it. Exactly to your point, what we're seeing is as these anchors open, the leasing team is obviously marking the space continuously, but demand for those type of local operators really stimulates when they see what's happening because the whole center becomes more vibrant. Your first question was on the tenants and in the leasing pipeline, and I'll ask Jeff Mooallem to comment on what he's seeing in terms of leasing velocity. Yeah. Hey, Floris. Good morning. Yeah, we're seeing really still good activity. I mean, as you know, we completed the Q4 with some really solid results, and the momentum hasn't really shifted in the Q1. I think the retailers are feeling some easing of pressure on the supply chain, and that's helped margins a bit. They're still talking to us about new locations. We haven't really seen any change. As Jeff mentioned in his comments, we have 800,000 feet of our leasing pipeline that we're hoping to get done this year. It should still be another good year, and we're digging into it right now. Thanks. Maybe one follow-up, maybe this is for you, Mark. Your $300 million mortgage for Bergen Town Center, is one of the options to use part of your existing cash and pay down part of that? Or do you think that because the mortgage is somewhat older and, you know, value presumably has increased, that you could actually take out an incremental capital when you put new debt on Bergen Town Center? I don't think it's the cash out is not on the table. We may consider putting a small amount of cash in to get attractive refinancing, but all of this is very live now, so I won't get into too much detail, but I'd say it's possible that there's some cash in. Great. Thanks, Mark. Yep. Thank you. Our next question is from Samir Khanal with Evercore ISI. Good morning, everybody. I guess Mark, when I look at your guidance, how do you get to the low end of guidance here, the $1.10? You know, when I listen to your commentary, you know, you're baking in quite a bit of fallout to sort of get to the midpoint as it relates to, you know, Bed Bath, Party City, and then other sort of potential fallout. Maybe just walk us through how you get to the low end at this point. Yeah. It's really a function of several things. It's basically taking, from an NOI perspective, you know, a full fallout on a more accelerated basis, as well as getting less collections, from the prior recoveries and then, you know, having interest expense, hit the high end. Really it's mostly driven by fallout above and beyond. While I've isolated some tenants- Samir, there are several others that we have kind of on a watch list that could, you know, get incorporated into the year. Some of it is for losses that, you know, I just didn't highlight. Okay, got it. Jeff, you know, in your opening comments, you've mentioned about 800,000 sq ft of negotiations that are underway. Can you expand on that a little bit more? What does the leasing economics look like for that bucket, given sort of the macro concerns out there? Yeah, I mean, it's very robust. I'm gonna let Scott Auster, who's our head of leasing, who's with us this morning, talk about that pipeline 'cause he's on the front line. We are very excited about, you know, the prospects. Importantly, you know, as we bring on tenants like Target and T.J. Maxx into our centers, I mean, what I'm seeing in the pipeline is just better credit because they're following these anchor positions that were previously occupied by tenants that were not doing very well. Scott? Yeah. Hey, Samir. It's really running the gamut. I remember talking about this on our last call of all the different categories that are out there expanding. It's anchors, it's shops. There's definitely the QSRs are definitely very active right now. That's a big category for us. Fitness is another one that's really busy with us right now, both in the boutique sizes and the full line gym guys out there. Excuse me, Samir. The medical category is the other one that's really active for us right now. It's really all across the board, shops, anchors, the general merchandise retailers. The discount retailers out there right now are still very active as well. We're really happy with both the activity and the level of NOI growth that we're going to see coming out of the other side of this. Samir, I think what excites me the most is the fact that, you know, I, and I said in my comments that vacancy rates throughout the shopping center industry are at all-time lows relative to, I think the last data point was 2007, where vacancy rates were at this level. Now is the time for us to really push rents, which we could not do when we were at 91%, 92%, 93%. We are confident that, you know, we will ultimately stabilize back up to that 96%-98% occupancy level that we were at before. At that point, we will push rents a lot harder than we have in the past. Last one for me, if I may. On, you know, this has come up with some investors is sort of the Sunrise Mall. You know, what is the current thinking or strategy behind that property? Thanks. I mean, we're continuing to work with the community. We have five remaining tenants left at the mall. We're also working with them on a plan that makes sense for everyone. We like our basis in the property. It's about $1 million an acre. We do look forward to sharing our plans with everyone once those plans have been developed. Jeff is rolling up his sleeves on it. We do hope to share more at our investor day in April. Thanks, everyone. Thank you. As a reminder, if you wish to ask a question, please press star one. Our next question is from Ronald Kamdem with Morgan Stanley. Hey, just a couple quick ones. I think you mentioned the dollar amount for the reserves for some of those tenants, can you just translate that into sort of a basis points drag on the same-store NOI guidance for, adjusted for non-collection? That 0.5-3.5, what's sort of the drag from bad debt? Thanks. It's about, 400 basis points, Ron. Got it. Okay, that's helpful. Then the, sort of the second question is going back to, again, this is another sort of leasing question, leasing activity. We are hearing sort of across the group that leasing has been sort of very strong, in the sector. If you take a step back, I mean, given the challenged macro, any sort of idea what's driving that? What are tenants saying? It doesn't seem like anything that's going on with inflation or the economy is really impacting it, which is good. Just on the ground, what are you hearing from the tenants? I think they're concerned that if they don't act soon, there won't be much space left for them to get later, 'cause there is very little new supply that's being built. Again, as occupancy rates increase, you know, throughout the country and stabilize maybe at, you know, 95%, there's just less quality space that's available. I would add, Ron, that for our portfolio in particular, that's especially the case because we are in such supply-constrained markets relative to the rest of the country. We do hear from retailers all the time that, you know, New York, New Jersey, D.C. to Boston corridor is one of their most difficult ones to penetrate. Great. My last quick one was just on the G&A guide. Should we take that as sort of the recurring rate going forward in the model? Cause obviously the G&A is a lot lower than it was previous years. Just is that sort of the new steady state? Is that a fair assumption? Yeah, that's a fair assumption. The only thing that could happen that we would adjust if there was, you know, we exclude, any outsized one-time litigation type matters. From a recurring standpoint, the guide, I think, gives you a good run rate. Excellent. Thanks so much. That's it for me. Great. Thank you. Our next question is from Paulina Rojas-Schmidt with Green Street. Good morning. Hi, good morning, Paulina. This question is for Jeff in his new position. In your prepared remarks, you highlighted some of the positive aspects you see of the Urban Edge portfolio in general, and you covered a lot of things. My question is from a strategic level, where do you think there is the most juice to be squeezed in this portfolio? Said in another way, if you could highlight one thing, what is the opportunity that you're most excited about? Good morning, Paulina. Well, you know, with 75 properties, all in sort of dense markets, there's a lot of different things we can, we can activate, right? It all kind of comes down to what is, I think, an inherently strong land value at an attractive basis. On certain properties, I do think there's gonna be an opportunity through entitlements and, you know, the municipal approval processes to increase the size of the assets. On other properties, it might be renovations where we can possibly grow rents from adding new tenants as a result of a better-looking property. In some cases, there might be outparcels to dispose or adjacent land to acquire. Certainly in across the board, leasing is our main focus. For me, it all comes down to, you know, having worked on several portfolios, at different parts of the country, over my career, it all really comes down to, you know, your basis in the land and your ability to do things at an attractive land value. I think the Urban Edge portfolio is really second to none, in the REIT space at that. I'm really kind of excited to get into the specific weeds on each of these assets, and see where we're gonna pull these different buttons. There's certainly a lot of opportunities. Thank you. Regarding the transaction market, what are you seeing? Any change at the margin? How are you seeing the pool of buyers, how deep is that today? I'd say there's still not that much liquidity in the market. There's a wide ask between what sellers want and what buyers are willing to pay. I think a lot of that is just has to do with where interest rates are. I mean, if you can get, you know, financing in the 5.5%-6.25% range for high-quality strip shopping centers, most buyers, including us, are gonna wanna spread above that. When you look at the REIT sector in particular, in UE in particular, where I think according to your numbers, Paulina, we're probably trading at an implied cap rate of around 7.5%, it's really hard to make the numbers work. What's your appetite to dispose assets today? Again, you know, I think because of the lack of liquidity, we wanna make sure that, you know, we would be smart sellers. That makes sense. There. And one. There are a handful of assets. I think it's safe to assume that we'll probably dispose of about $50 million a year. Thank you. One, maybe modeling question. This year, your same-property NOI, including redevelopments, grew less than excluding redevelopments. I assume that the contribution of redevelopments for next year should be positive given everything that you have leased and scheduled to come online. Is that a fair read-through of what you're saying? Yes, Paulina, you're exactly right. Next year it would be a contributor. Is there any ballpark number for that contribution? No, we haven't broken it out separately, but it's flipping positive and even more so as you go to 2024 and 2025. Okay. Thank you. Yep. Great. Thank you. Thank you. As a reminder, if you wish to ask a question, please press star one. Please hold while we collect new questions. Ladies and gentlemen, there are no further questions at this time. I would like to turn the floor back over to Jeff Olson for closing comments. Oh, great. I hope everyone has a great Valentine's Day, and we'll look forward to seeing you at the Citi conference and then at our upcoming Investor Day. Thank you. This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.