GIPR - Earnings call transcript Q2 2022 | Generation Income Properties, Inc.

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Operator

Good morning ladies and gentlemen and welcome to Generation Income Properties Second Quarter 2022 Earnings Conference Call. At this time, all lines have been placed in listen-only mode. Please note that today's conference call is being recorded. Replay information is included in our second quarter earnings release issued on Friday, which can be found on our Investor Relations section of the company's website at gipreit.com. After speakers prepared remarks, there will be a question-and-answer period. now Staff, conference Emily will company's to I of Chief Cusmano. Instructions] turn over the the [Operator

You may begin.

Emily Cusmano

Officer; Chief Thank you, an and by Executive capital morning am overview joined Allison operator. Good growth morning David everyone. of the markets Sobelman strategy, will activities. Officer. David Financial I company's this and provide Davies, business Chief

market that current Today's will financial results quarterly with performance. in quarter from and in these conference are predicting statements includes events results factors size, among are Second uncertainties and those call subject our other highlights projected company's subsequent anticipated planned results actual future review events materially reflect Certain conditions. forward-looking and These to forward respect differ statements. acquisition statements balance future inherent forward-looking views could financial to to-date, sheet. the the cause Allison looking things to and activity,

time the may those is uncertainties on and it not and these risks Therefore, forward-looking it. affect or for possible place events should statements. you arise undue New not reliance predict to how over company they

we to call, SEC. GAAP to and for important refer factors that the non-GAAP operating XX-K in including filed ask forward-looking found to these you included risk projections, or our our measures. core in SEC these measures to cause release the that materially year each fiscal could in FFO, net which our the most with actual this for AFFO, comparable investor and We with statements presentation. and During refer from net filings to XXXX core income differ recent the Form factors of Reconciliations be can financial the are will most income FFO, AFFO non-GAAP measure our earnings results

XXXX. that As only XX, as such, date be as may information comments note time-sensitive Monday, is of August management’s today’s it accurate that include to important

we one turn that question ask Following call your only questions. ask management’s now request for and to Chief Officer, will Sobelman. the ask follow-up re-queue ample that, questions. With our everyone you time questions. over this to call David open for to time We to you to prepared welcome permits, comments, Executive will additional I allow one be If

David Sobelman

and welcome you, call. Emily our to earnings Thank

of focus with Properties a and industrial net Corporation, NASDAQ company familiar acquire properties you populated retail, those For own on not leased Income credit grade formed real is estate to densely tenants. investment XXXX with located Generation a listed in submarkets, in and opportunistically office

of to by assets durations grade portfolio remaining diversified of District specializing currently differentiate We states coupled of the real underwriting opportunity We expiration, typically their tenancy consists or Our fundamentals. primarily in correlates ourselves years, either the under and strong XX primary asset Columbia. XX maintaining higher investment of across in future current a the tenants estate years. this lease to eight lease with combination with believe beyond probability tenants, their re-tenant

because to resilience with to large has underwriting comprehensive values in Our private by attractive investors. provide segment our on focus institutions that rental assets attractive process potentially We oftentimes and long-term overlooked shorter investment opportunities higher grade terms lease tenanted shorter terms credit realize rate both economic this view, lease increases and stabilized flexibility fluctuations. are determined

uncertainty our the markets. help to portfolio long-term the today's better throughout order is second we on us focused quarter, stabilizing that debt and in, During the perspective from creditworthiness prevalent both navigate

tenants. grade of assets mentioned, and XX million portfolio consists primarily our $XX made up investment value gross credit of of with current asset As is a approximately

in group. the investment our portfolio fact, of of equivalent, grade highest of we In rent which investment or is based tenants XX% in peer grade annualized is terms GIPR's made believe proportion

diligent base about assets. of contractual that that gross focus have we're on annualized and with quality our growth to growing the report our internal to We've high continue We and increases the portfolio portfolio. be of maintaining rents increased to XX% our year-over-year within by we're are of also asset portfolio, value happy continued XX%

or rental CPI fixed increases what worked has Consumer either in year, Price rates primary Index benefit term. to have this We shareholders with our lease increases our the

structure. For instance, rent cap our the billion approximately XXX basis investment due of provided asset second to us last company a quarter, by their have the with growth increase York in had of These rate Services, grade guaranteed and that by Construction credit over with uncapped lease the points is annual in in an tenanted increase Quanta the Exchange CPI New period a growth property And in seven of same X% rental our that rent to internal to $XX assets years Irby refinance their insulating the Stock because approximately long-term remain increases our same completed our focused how put from could through was major which surround announced is seek volatility times. it's properties, refinance to come. some year. we portfolio of in our of demonstrated important investment at of that for component April. continue We that portfolio mention provide previously the into also on being practice a metrics to opportune It's market thesis

of provide GIPR announced, replaced our us a of below our for goal each seven to what long-term Bank term this securing X.XX% stabilized of year. the debt all Valley with debt of properties, for for As approximately asset. at in debt tenure today the million second interest beyond short-term maturities $XX.X debt is lease of primary which We long-term with market from rate debt quarter have accomplished

until the we expiration where no the of As exceeds mortgage assets, have debt our portfolio mid-XXXX. of approximately today, and by expiring XX% lease of the encumbered is primary debt maturity

investment durations Given one primary do property. a beyond of the feel our this and term that in belief to thesis, any performance. not is lease mortgage typically lenders provide debt We their that testament

sellers the creating the a persistent cost bid their adage You've money, industry experienced of is between adjusting as of patient in expectations I've the net ask capital, being lag lease and long widening for probably smart have. rising the heard spread. money pricing as I a pace

mimic continue to current our investment see opportunities criteria. credit meet from and assets We a our estate of portfolio our acquisition today real that pipeline And perspective. that worthiness consists

remaining However, these recalibrate. patient opportunities years. acutely market buyers Early to we are underway more the example, that market buyers sellers but us on may to a we're to that the the tend for waiting signs and be on more to buyers essentially last being high close include certainty are longer, note suggesting focusing who for fickle, versus, with XXXX driving Exchange several for sellers be

we in our with roughly with our of swayed principles LP the a totaling from $XX need to value largest and portfolio two believe we, disciplined partner assets And testament the appreciation of speaking to in of remain in cash, short-term GIPR be our continued into limited price Unit whose of which propel We To to and market approximately quarter for his our growth are over we partnership won't long-term. million response common in third $X.X and for to Holder acutely the investment initial recognize stock agreement balance million the redeem in external is XXXX. the XXXX, long-term. aware in contributed shares entered But support to units days the dislocations. future will confidence

are their involvement external of a successful to our has our part we Our UPREIT with company. been and growth, continue our that happy partners program willing are

amount call We and outreach of in our with company, interest about I members in our of more centered the proved story. on to level CFO, that initial interest plans. an groups understanding other in our our With also a company REIT to the investment meet with with present time were be Annual we of New to there to noticed knowledge attendees beyond encouraged new by Davies. Most were and that interest beneficial turn in the long-term NAREIT's of and level delighted quarter the over senior second our our delighted Investor went growth Conference, peers. with invited increasing to REIT our being this by surrounding our expressed The of meetings we both were us a of members learning And about I'm their in was Allison attend the in we us throughout by our GIPR left management, York that, our along of New that to and York understanding. being year of to were interest efforts, level thesis, industry. events

Allison Davies

David. you, Thank

high relatively mentioned, portfolio GIPR's assets estate and As quality insulated from tenant our credit well real David economics. located to keep base shifting continue

inception. to base collect continue GIPR's weighted is at and of our years, is lease lease thesis. since reflecting XXX% remaining X.X average term occupancy We short-term remained rents XXX%

lease one discussions with exploring alternative XXXX have active is our end in and of the also tenant while the team tenancy. at We expiring

able to downtime. renew asset market, quality high we confident re-tenant are we be that with demand Given in the will or and minimal successfully

extremely last back As proud accomplished. of everything I'm I the we've look on months, few

acquisition future forward on American interest Momentum hikes and quality was Just the as to slowed on with has equity commitment market We onboarding access for $XX the within commitment as a plan our and to of closed and the This certain I increase purchases. pause, hit had still position has four chance growth $XX this set team to down. the from we we're high full concerns recently million looking have assets slowdown that mentioned, Bank. growing team up we financial for given commitment to months. a rate recession, David But the to. ourselves to few of our evaluate our just recently up use million modified And based a criteria,

$X.X we release increase quarter, from to quarter. million income last compared tenancy the periods able recoverable recoverable acquisitions XX%. increases and compensation expenses same expenses, a indicative is an depreciation we million year, was costs. acquisition the $X XX% a Total our as year-over-year respectively. ownership in of were of expenses This underwriting clearly this are increase. our driven focus increase we contractual to of and our investment Additionally by accretive results by ongoing Net increases. the operations common XX% operating recent was financial driven fees, our in period the were and operating rent professional a on and primarily and Operating night the XX% Friday increase is million for press revenue during for during investments. amortization $X.X of million asset. and same $XXX,XXX from This in which disciplined to represents properties, increase announcing $X.X the performance strong April, issued pleased increase And in with and from

pursuing. expense we from During approximately deal longer debt to the $XXX,XXX incurred costs incurred of no assets acquisition quarter, portfolio in are we related a

same was quarter While when we asset we pursuing acquire the compared to attributable minimum, increase as we the expenses the is $XX,XXX same shareholders. for highlight our as mentioned in to for for the deal keep last $XXX,XXX to exercise does pleased to to a where every acquisitions the previously. is I'm to directly we All ability year, Net $XXX,XXX to growth loss asset ended was for which this period year. ensure the believe period aim this very quarter. expenses $XXX,XXX said, compared discipline AFFO last with we a Core to accretive

a a sheet market are healthy us balance this have strong uncertainty. and withstand that cash We to balance positioning

over converting hedged not We debt, in expected of base, and our and against only that, made build throughout our in in structured I'll to requirements, mortgage finally, the to cash successfully year. opportunities With debt financing maturities quarter to provide for long-term of to have have but upon half team to the rates. strong fixed, turn variable underwriting the us uncover pipeline a to are rates increases secured great asset the And a also the continued interest relationships position to back acquisitions on execute continue our our second new David. growing for from call and of our the all continue all manage

David Sobelman

Thank you, Allison.

us that is I families after. come call for decisions all for of effort generations. today, you multigenerational our from that for be wanted from you name of those was that the our your has not Properties that Income goal those but also derived Generation have only you for been the a for confidence making that for opening income, open just our generational part questions, ethos but Before questions. With not call long-term. the And we philosophy It the operator, legacies, the your in for affecting who begin generating to placed please remind It for benefit of the thank GIPR. to stakeholders

Operator

[indiscernible]. from is question first Our Instructions] [Operator you. Thank proceed. Please

Unidentified Analyst

and I morning, are to to to much in different months? market cap Thank comments you. that about I your was last understand the some color in few Good expectations, hoping moved guys you you on can CapEx transaction talked want back subsectors that buyers know, sellers you on provide rate go I the for but how maybe

David Sobelman

Gaurav This is [ph]. David. morning, Good

cap I'm hover not or and a at showing is our rate That's research estimate assets specific that's rates So very giving we're X.X% our been of cap that for properties have X% a recently lease just you. I've of and what net average that around in all rough pipeline, anything read. number that looking purchased above Most higher.

Unidentified Analyst

so properties that term probably Okay, that's lease properties, than have for higher that's, X.X% your number that's target - right? longer

David Sobelman

That's right, read, research that that's the net available properties. all I've for lease

that focus shorter we so subset durations. And on have lease of properties that

cap the higher are typically, rates those. So for

Unidentified Analyst

retail, how and of think industrial the office? we for your as allocation Okay between we the year, remainder about about acquisition pipeline should think

David Sobelman

Yes, we lease company. net are diversified

access available go capital have going We're are So our at of that for after assets consists the the pipeline classes. best we asset that to that time. three all to

all we'll when make pipeline determination which and add our it ultimately, fruition. types, of So asset consists to comes to three that assets of

Unidentified Analyst

Okay.

common a by covered that think dividend on coverage your is How David Lastly, should about forward? AFFO. dividend, not going we

Allison Davies

and as - possible. future you cover we're And us. working we are our to at that able this anticipating morning priority soon dividend is that to a to able But Good covering do stage, for as with know, acquisition. the be we're we'll be Gaurav

grows any So the our company as size to and we'll as continue market just that. on imperative update

Unidentified Analyst

you. thank Okay,

Operator

of This the I over the turn Mr. to call will concludes back portion question-and-answer call, today's

for closing Sobelman his comments.

David Sobelman

focused name in and result. is great that steadfast us. may beginning. just company to we joining a and of we markets, disciplined our short, are we ourselves a that at greater opportunities for the quarter. this Have seize the believe but remain principles are time Thank work and We as as will a We again environment you our positioned and speaking threshold think, realized to profile. In current wealth weather on we our the remain an uncertain patient we global as creating with And well is generational economic implies. have the come forward next week, you look we to

Operator

does This conference. today's you. Thank conclude

may disconnect You time. at this lines your

Generation Income Properties (GIPR) 15 Aug 222022 Q2 Earnings call transcript