IVT - Earnings call 4 2023 | InvenTrust Properties Corp.

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Operator

Thank you for standing by, and welcome to InvenTrust Fourth Quarter 2023 Earnings Conference Call. My name is Benny, and I'll be your conference call operator today.

Before we begin, I would like to remind our listeners that today's presentation is being recorded, and a replay will be available on the Investors section of the company's website at inventrustproperties.com. [Operator Instructions] I'd now like to turn the call over to Mr. Dan Lombardo, Vice President of Investor Relations. sir. ahead, go Please

Dan Lombardo

Good today. and operator. attending you our call morning, you, thank everyone, for Thank

from InvenTrust Financial me Chief Executive Chief Joining the Officer; Investment Officer; and Busch, Operating Mike Chief Officer. President Phillips, Dave Chief and Officer; David, team Christy Heimberger, is DJ

Following team's questions. we the lines will the open remarks, for prepared

and views These performance, of of our future based some reminder, contain including a current expectations the earnings comments may beliefs conditions. and forward-looking and to and on financial future statements on management's As are today's uncertainties. about are various forward-looking guidance the market company's and business risks subject

the speak statements financial release. press forward-looking forward-looking assume made supplemental no today's to only Any in date, statements and or we quarterly as of call on or any update today's obligation are that

will also quarter's in included certain our Investor reference measures measures. Relations are on non-GAAP this financial GAAP The posted addition, website. In we comparable are earnings which materials, financial

to I will that, With turn call over DJ. the

Daniel Busch

good of morning, provide an start and results of on conclude expectations, will Mike Dan, and the our with XXXX, on operational the of success some full Christy Thanks, our quarter color regarding summary everyone. with and overview financial fourth and our XXXX brief continued year a I'll some the will Today, front.

of excellent introduced InvenTrust the levered plan. straightforward and while focused a It since has allocation in a operate Belt strategy. and that exclusively XXXX own continues the little resiliency essential U.S. and of capital and open-air simple X maintaining to portfolio year is years region public centers performance which another low for InvenTrust, in employ strategy and capital been to was and our market retail demonstrate Sun simple structure October 'XX, the the of strength its over to a

core It's the full NAREIT income And net year, net center above completed $XXX base. or of since NAREIT average. activity average well of asset of company the XX%, by expansion XX% grown an market, In per the by shopping per share million above FFO public again, joining a operating the increased has the the years center average X same-property investment shopping X.X%

in strength demand trends underlying dynamics and XX% Belt are retail amount demand driven which of of Sun nearly in in markets the with a Texas states have and favorable Florida that way. benefited by drivers construction. operate migration the To the properties we generationally our further, from fundamentals undoubtedly a The low is positive leading our located in new disproportionately step take

strong an leasing bankruptcies spite in number well-documented uptick left the to minimal vacancies up our on retail velocity In continue of push XXXX, portfolio. and of the some remains as rents in we lease

new In the more fact, than in fourth executed in deals XXXX. since quarter, quarter any we

at continued continues near an high primarily the over by in highs a driven tenancy, quarters. of be our result, all-time has strength and lease As consecutive sequentially occupancy for again reached all-time increased XX.X% XXth shop small to XX% which

or Moreover, confidence ability necessity-based may whatever economic merchandise not our credit in and the offerings may our strength in tenants' operating years. within us disruptions mix underlying coming despite the unfold predominantly gives

contributors efforts guidance, cycle related downtime a for the our to earlier, to XXXX. And beyond in leasing the some noted favorable indicated growth will XXXX within more today of our be than As continued are our normal offset the business anchor the business. bankruptcies expected trends within sizable

acquisitions. remain allocation new capital the front, regarding selective On we

look disciplined of as private in we continue our We continue to to be values, portfolio. to to market carefully and the grow monitor we'll capital cost relation

in first when subtle During manner. publicly since InvenTrust capital a raise another time we and displays be avenue traded the modest program milestone a ATM for This important a for did used company. our if amount quarter, raise yet through to equity value-accretive yet the becoming proceeds of can

balance sheet did quarter leverage InvenTrust's acquire of position we first put we're MSA strength we expand center in to market company Chandler, marks property a in in subsequent demographic footprint de Belt a and near-term grocery-anchored favorable be that many seek that maturities and as Arizona. note, Sun company. markets. an low Our InvenTrust core the the in to This Phoenix exhibits the of the and growth. levels continues minimis enviable of in new our to the see sector excited the rest drivers the for On opportunities our

flow and into expect superior Our cash described, selective coupled X which the for total growth external deliver year on like by operations, just to out, we in returns our year opportunities, the core recipe how growth sustainable is translate precise should stakeholders.

discuss turn I'll our to results. over financial call that, the Mike to Mike? With

Michael Phillips

everyone. Thank our by will good discuss sheet through of start year morning, Then and guidance. taking our you, DJ, and quarter full our with I financial condition XXXX conclude fourth balance I the you highlights. and will

growth, interest December nonrecurring of nonoperating or from ended activities. months XXXX. income remaining year per per for FFO and share $X.XX million The joint XX% These share. items $XXX.X $X.XX or To income were the expense. NOI the by our NAREIT increases driven interest was NAREIT start, offset diluted higher-than-anticipated primarily $XX.X XX, million was diluted Full FFO the by higher were X of acquisition venture, partially higher

diluted of results fourth fourth results in previous over an quarter InvenTrust's year. XX% increase X% $X.XX over same or were the million XXXX. X.X% Fourth diluted increase share, of $XXX.X million per NOI were $X.XX grew per same-property quarter at an quarter or of Full XXXX. For core over share, quarter $XX.X FFO, year the

basis growth and expense base points headwind from rent of XXX net X.X%, from reimbursements expense basis XX offset XXX the and and for XXX NOI base basis XXX collected uncollectible points, grew a in XX XXX point basis at ancillary primarily growth revenues revenues rent by percentage points, of of basis out-of-period points of basis driven rent Full same-property NOI of basis offset by points and partially of net uncollectible. by points, points deemed of rents reimbursements XXXX. XXX basis were deemed quarter Drivers year

million a remains was borrowing our to debt balance net sheet and capacity of is $XXX available line XX% well our ratio $XXX adjusted trailing liquidity, million a credit. basis. XX-month of X.Xx Our positioned leverage on of EBITDA total with Net full on revolving including

rate Our ended at the weighted year average with average X.X% interest a weighted years. X of maturity

million a options. we X-year our down X%. by debt, the loan to extended we of its in paid In As our reminder, October, pooled X debt variable maturity cross-collateralized executing rate $XX on reducing extension X of exposure December,

net $X.X on As price DJ mentioned, at market a of million proceeds the issuance of weighted average $XX.XX. open the XXXX, we at XXX,XXX raised shares of through of the end approximately

Board In quarter, dividend annualized dividend And saw share. also dividend our payment declared brings per share. with increase in the release April we X% announced as you our press $X.XXX another fourth a XXXX our to This per of our beginning yesterday, in payment. the $X.XXX

by remarks our $X.XX my guidance. Building conclude NAREIT on results, will to XXXX per I be discussing and XXXX share. between our strong expect $X.XX initial FFO we

setting G&A, the is Components per expense of higher interest for $X.XX income. guidance are which NOI to by include offset of $X.XX range FFO increased same-property interest We acquisitions, and share less growth and core FFO.

range same-property we to of expect be X.XX%. the Finally, X.XX% in NOI growth to

debt of XX basis same-property XXX assumes reserve bad a to NOI points revenue. Our range total of guidance

Growth basis XXX rent contractual same-property points bumps. coming base from is for NOI including primarily by rent, driven

are yesterday. guidance disclosure assumptions year Our in provided our filed supplemental full

I'm turn to that, call discuss over And to portfolio with our going activity. to the Christy

Christy David

Thanks, Mike.

retail of Let remarks. the supply premium DJ's particular, demand. strip and experience retail for leasing far and Belt me supply several be center we averages come, limited high in the earlier for space to scarcity the new in historical momentum to reemphasizing Sun and limited begin the is keeping premium believe across below years new will country by space. by space The continue have driven We

with team at this each XX and of remerchandising quarter Quinta, dynamics of on is at signed most We able outstanding The these XXXX Superstore recent and of former leases the in to XXX,XXX Nordstrom the active spaces, activity California, signing experience X with additive the was La will in and strongest mix our fourth X Part PGA X These The rates Rack Carolina. for credit rental over North these centers. square Charlotte, & with be of Bed in other Bath increasing capitalize customer centers. feet. tenants tenants the of and years. tenant stronger to by included Beyond market

projecting these sizable the with open sometime are in rent spreads stores We to XX%. XX tenants to their next months over of XX

The Bed Beyond lease have that team is Bath received We X and each tenant the proceed to LOIs. asset multiple assessing for actively execution. best remaining each will have spaces &

basis our points portfolio's During House, up All Old last the also leased reapproaching with occupancy quarter, this XXX XX.X%, Yard secured leases tenants, quarter, Navy and peak. Brewhouse. BJ's other to increased several total portfolio we activity the from including

an lease occupancy last lease points high increase shop XX.X%, XXX of increased XX.X%, a portfolio. quarter, occupancy Our new for anchor our to space finished basis small and point at our from

of increase total an is XX, $XX.XX, compared XXXX. InvenTrust's As to of X.X% portfolio ABR December

with the the lease The spreads X% for comparable XX.X%. quarter. spreads new posted of approximately nearing were For we renewals quarter, blended leases XX% for

at rate retention see Our existing meaningful to continue at remains tenants increases. XX% renew their as leases we

centers. tenants in XXXX in have main experience our few will operating expeditiously all spaces open our work activity and to at lease within teams remaining points leasing up ensure anchor of for our be localized focal One and to result our the portfolio new the XXXX

our that you concludes for remarks, questions. prepared and line Operator, the open can

Operator

Instructions] from Dori Fargo. first Wells from [Operator the Kesten comes line Our question of today

Dori Kesten

are net sales $XX is asset in And today? how non-Sun million investment you your that? of that in site assuming some year, Your Belt much within activity this

Daniel Busch

closed to is about built $XX the pipeline. Dori, guidance, on already into Yes, a of quarter. And there's we've then think couple the it this obviously, net you in $XX first very One, the DJ. assumption the million investment ways. as so relates it within that's that visibility good million of can

pipeline a dollars we're always Our looking of hundred tends that have at. million deals couple of to

either certainly, And would last Now than a would suspect would as the acquisition imagine, those, quarter. away can pricing year. of continue in different today from But pipeline move direction. the that due to us diligence, feels I that, many under gets decide or we you it have through better

how our And same on many of our I investment today. peers is just seeing well. An pipelines really it's the believe as note market important within their seeing the of type are assumption we're net visibility

cost what looks on depending like. our pivot will of We capital

that million back. where it's making conditions obviously $XX we pull will accretive accelerate the business. we pipeline, at could buy perhaps get is the we And on market to the or can predicated believe So we the today, better if sure current

would we to being always are if assets in candidates. are along accretive me. X said past considered outside have it capital, an on question move that Belt, are relates for Sun replacement are Maryland. excuse Richmond, Those your of in Belt. for those we the Those that in that assets As found non-Sun from X we There that -- X assets

we And will do to continue so.

of predicated those the properties on be we So much do the how on can just dispositions acquisition will side.

Dori Kesten

believe we year? Or at stands I XX% additional floating Are with that throughout you level And the I expired. swaps your around just now under exposure some swaps? comfortable should expect, guess,

Daniel Busch

And the as we monitoring Yes, is. obviously, curve else are. we're everyone

As on we cash with down the decide We pay last debt of little XXXX. to did bit. through a exposure to a end hand lower look little that at year bit of

direction move I market will rates our can't find opportunities XX% choose the obviously, for in what we away number a us. we is think to open first but choice, in chip if a that different we're It's good expecting. not with if than it's accretive

markets look the a second half bit start we'll replace then we'll more that look and when of the at with are that this And permanent probably debt comminative little to in year. to

Dori Kesten

to rationale talk issuance size small relatively the And just the you the lastly, ATM in of behind the can quarter.

I said accretive the -- pricing acquisition. the mean, think I with the was you

So million sizing. just yes, $X the

Daniel Busch

absolutely. Yes,

of with X list So X we few say, I would the the is challenges, the company. as when decided did not know, we challenges you obviously, of equity our to issue --

So we didn't traditional do IPO. a

us de have it for to that was access. minimis the as is million So we important -- $X do show that as

the obviously, market, REIT of really if and put we avenue we there do an just in proceeds it the is pricing and little raised accretive to was we to bit, explore a level to at that came end decided can a in momentum down manner. and for us that price and continue where just when year little -- we gets a the it's something that to the think we'll work acceptable the And

Operator

question of from next from today [indiscernible] Our America. Bank of comes the line

Unknown Analyst

It was and you market. good close in center the that see to guys on Phoenix new enter

that rate, might could market, opportunity from just any on the you I to And on if if but familiar -- get starting then cap Just or team be the your the curious on would Where pricing expanding that of have missed you you on details kind is how plan there? process it, grow with will helpful. provide there?

Daniel Busch

Great question. to that. of address [indiscernible]. Yes. most happy I'm

So particular, This in and goes Arizona nature. Most larger owned and of me, market in predates boxes operated assets is but and has market this those years. Phoenix, prior. were back a in several InvenTrust that

market a had It's been that a familiar with. just was it So team the while. was

And ground, our to asset. and to a it There's have or We and last, a stick the value-add Phoenix of set a listed call relates management It's that even we've And work really very -- asset. it's you it's reason those was just more flag company. assets we years asset trying leg stable it, great. ourselves kind find X it say, interested X the and put should the over the to in it with operate bill. lot of that going It's the not been market been property to can -- MSA that to familiar really of of from is since familiarizing do kind as any in with high-quality it more it, the right do fits into. getting It's couple I getting of this opportunities. a

growth. call important have vintage. lot is embedded the these don't new, it, sometimes rather It's whole reason assets newer lot XXXX of of rent a a that's And

in was market changed the has XXXX However, was if in retail where Phoenix where dramatically. XXXX, you and think about

So for more a stable little actually we bit X has more actually do a this think upside. asset,

of a or to grocery, smaller. the hurdle This question, we into relates it IRRs kind bit cap try the pricing to. core asset unlevered a it's get your specific As it's without getting Obviously, get rates. that rates to little did to

the get imagine IRRs right that is could call X%, to to it, trying Xs you X%. So high we're around or

Unknown Analyst

put And the seems out points assumption loss credit XXX guys XX you helpful. Great. the basis wide. That's to within guidance, fairly

it's comment Just are of incorporated for I whether based versus on what what assumptions don't you know underlying be curious the if specifically on cushion, might unknown. that on And scenarios tenant disruption then for the Jo-Ann. known can

Daniel Busch

No, Sure. happy to.

we just And Aid that Also that in X assumptions Rite So we the in have to assumptions point range. Jo-Ann. incorporating would in basis that incorporated be X -- XX underlying is our it have XXX out If but feel is make be we through confident that Aid going the Rite Obviously, a process. that California. site process, seen. happy in through to it's the they they're with, we'll wait

really shop is make would level And unknown more is small A point remainder at some years up The is the -- then expected shop. has been surprise. a pleasant the over the risk the small X normalized that and balance. last

Jo-Ann. a remainder anchor those one's, then So Those the the point And unforeseen fall I other kind the X make X with really the side, is small nailed you out. would of that shop up would I'd don't it But Rite on be just mention to. Aid. ton.

Operator

from comes question line Point. Van of from Instructions] The Dijkum Floris Compass the next [Operator today

Floris Gerbrand van Dijkum

seems term medium pretty I over it well So terms results. dollar flag Phoenix I portfolio doing big like know expect I for in in a we what The market IVT to of to can bit, assets market. to mean a is you a for or to here. the but is DJ, a a of in Phoenix new we solid volume expect? own little be mean, addressed what terms pretty you Phoenix? plant could -- market,

Daniel Busch

quickly. to the And things question. great one you with really a it's get have challenge hard yourself it's scale that is No, of to Floris.

X set we'd X where if time we happy. depending we asset those for of the have market, it's or only period the found an pricing on it's within a opportunity ones So of be

the because That or we Now of level obviously, indicate at operate where reason think best that we have are a think much the we that's when assets think clustered where have very to our a level of about assets and like we you clustered X nature our get we if at in that operate to we at market. higher X feel we -- our that least portfolio that, would portfolio. a

time. going take just that's Now to

in would But in I kind market the sense. of portfolios should there's say, fell also where that never few, X a make can swoop, especially very grab or you single pricing

X this that while. we've So for is eyes a had our on

For a on to high it has lot earlier, of look, with got going be our portfolio to list Phoenix our it. it to add the we characteristics reasons I is as very mentioned that of has. comfortable the been because And

in Texas, we characteristics in that North of many we characteristics -- Carolina. the -- we that see see in in the ones it's in X the And our that cities see the Florida

So opportunity and It will in of the we're opportunities the set we the we're right that city if arise. the excited confidence gives about Chandler and further county. to largest there continue the third that a us lot expand exploring being in spot,

Floris Gerbrand van Dijkum

Speaking has in of its that of for had opportunities, to I bunch on think, at portfolio They out radar? the Phoenix itself well. I curb. basically -- that. -- Presumably, look something put would I market you that stuff, on know in site those mean, there Is your a as focus

Daniel Busch

or specific into neighborhood you grocery. we'll at know, while Floris, certainly certainly companies everything, our portfolio center or predominantly because almost Without getting as and portfolios, exclusively look necessity-based

are We smaller We centers. have some agnostic. can we have -- properly We do be centers. power do some

focus location, necessity-based most and in So our the is location. for right model us retail important the business

the little a ignorant not something higher. it's a that at team and most And operations come the of or that, risk to a be take nature of those were I would could of those rates hurdle to to higher are look with But level and we little imagine we imagine little going bit larger But would would I if with it. certainly comfortable would would in be because perceived speaking underwriting get being a portfolio. Just those, risk. if site centers bit

Floris Gerbrand van Dijkum

me. And Great. question X other for maybe

higher Your are in as probably your peers I where -- occupancy mean, both I see argue well occupancy much look -- I over say, that, XX.X% sector for your XX the levels at I'm How -- this, do but at of to think your see push your the I how greater you and shop your near shop in would much more XX growth, anchor as potential occupancy occupancy you as -- in you where top view your next probably curious are room leased months? to would how has about anyway. -- can

Daniel Busch

it's good question a No, and observation.

Just to -- to little just around give a color in dive that. and

in well entire anchor We getting underway place. & leases we're are closures, X signed the vacancies which of of have portfolio, in which Bed Bath X from Beyond on

the which held for is or now. purposely development some that's Florida, in larger opportunity of of form in say, in which will I the couple then next a -- vacancies One a the also negotiation redevelopment, are being be X should years. last of us for right great is down And

the to close effectively the all of getting those. finish line on So X, of team is the

Now but that's occupancy full not to going getting side. close say fallout, that anchor we're the to some have pretty to not we're on

in have that shop. strategies headway The for the up of with of remaining space, that on the working out, observation been has I on coming leased So And X.X% while good lot a and some set small your a is lot made is of we've we obviously which think been hasn't is opportunity a correct. team in hard that. really the vacancy

couple no best at is will can to tell of occupancy. over coming The return our would rate and retention. higher bit rates probably with higher growth rest from get from years continue Retaining to is the a you come we minimal rent a the concept. capital, to that little and and going be next of I proven

Operator

questions additional waiting no this are time. There at

for I'd to any So pass over DJ the remarks. like call to back closing

Daniel Busch

you, And this thank joining you. us for Thank morning. everyone,

the questions, in here. interest team free a to any look of your to if always, in and Have many joining out our forward to and have you months. feel we reach coming We As InvenTrust, you day. seeing great appreciate you

Operator

call. Thank conference all your for participation. today's concludes you This

now You your lines. disconnect may

InvenTrust Properties (IVT) 14 Feb 242023 Q4 Earnings call transcript