American Strategic Investment Co (NYC) 2024 Q2 法說會逐字稿

Good morning and welcome to the American Strategic Investment Company's second quarter earnings call. My name is Bailey and I will be your conference operator today. (Operator Instructions)

早安，歡迎參加美國戰略投資公司第二季財報電話會議。我叫貝利，今天我將擔任你們的會議操作員。（操作員說明）

I would now like to turn the conference over to Curtis Parker, Senior Vice President. Please go ahead.

現在我想將會議交給高級副總裁柯蒂斯·帕克 (Curtis Parker)。請繼續。

Good morning, everyone, and thank you for joining us for our second quarter 2024 earnings call. This event is also being webcast in the investor relations section of our website. Joining me today on the call to discuss the quarter's results are Michael Anderson, American Strategic Investment Company's Chief Executive Officer; and Mike LeSanto, the Chief Financial Officer.

大家早安，感謝您參加我們的 2024 年第二季財報電話會議。該活動也在我們網站的投資者關係部分進行網路直播。今天與我一起參加電話會議討論本季業績的是美國戰略投資公司執行長 Michael Anderson；和財務長邁克·萊桑托 (Mike LeSanto)。

The following information contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which are subject to risks and uncertainties. Please review the forward-looking and cautionary statements section at the end of the second quarter 2024 earnings release for various factors that could cause actual results to differ materially from forward-looking statements made during our call today.

以下資訊包含 1995 年《私人證券訴訟改革法案》含義內的前瞻性陳述，這些陳述存在風險和不確定性。請查看 2024 年第二季收益發布結束時的前瞻性和警示性聲明部分，以了解可能導致實際結果與我們今天電話會議中做出的前瞻性聲明有重大差異的各種因素。

Should one or more of these risks or uncertainties materialize, actual results may differ materially from those expressed or implied by the forward-looking statements. We refer all of you to our SEC filings, including the Form 10-K filed for the year ended December 31, 2023, filed on April 1, 2024, and all subsequent SEC filings for a more detailed discussion of the risk factors that could cause these differences.

如果這些風險或不確定性中的一項或多項成為現實，實際結果可能與前瞻性陳述明示或暗示的結果有重大差異。我們建議大家參閱我們向 SEC 提交的文件，包括截至 2023 年 12 月 31 日、2024 年 4 月 1 日提交的 10-K 表格，以及所有後續向 SEC 提交的文件，以更詳細地討論可能導致這些差異。

Any forward-looking statements provided during this conference call are only made as of the date of this call. As stated in our SEC filings, the company disclaims any intent or obligation to update or revise these forward-looking statements, except as required by law. Also, during today's call, we will discuss non-GAAP financial measures, which we believe can be useful in evaluating the company's financial performance.

本次電話會議期間提供的任何前瞻性陳述僅在本次電話會議當日作出。正如我們在美國證券交易委員會提交的文件中所述，除法律要求外，該公司不承擔任何更新或修改這些前瞻性陳述的意圖或義務。此外，在今天的電話會議中，我們將討論非公認會計準則財務指標，我們認為這些指標有助於評估公司的財務表現。

These measures should not be considered in isolation or as a substitute for our financial results prepared in accordance with GAAP. A reconciliation of these measures to the most directly comparable GAAP measure is available in our earnings release, which is posted on our website at www.americanstrategicinvestment.com. We also refer to our earnings release for more detailed information about what we consider to be implied investment grade tenants, a term we will use throughout today's call.

這些措施不應被孤立地考慮，也不應取代我們根據公認會計準則編制的財務表現。這些指標與最直接可比較的 GAAP 指標的調整可在我們的收益報告中找到，該報告發佈在我們的網站 www.americanstrategicinvestment.com 上。我們還參考了我們的收益報告，以獲取有關我們認為的隱含投資級租戶的更多詳細信息，我們將在今天的電話會議中使用這個術語。

I will now turn the call over to Michael Anderson, Chief Executive Officer. Please go ahead,

我現在將把電話轉給執行長邁克爾安德森 (Michael Anderson)。請繼續，

Thanks, Curtis. Good morning, and thank you all for joining us. Our positive results for the second quarter included adjusted EBITDA growth of nearly 50% compared to the second quarter of 2023. We achieved this growth through a reduction in G&A and operating expenses coupled with our ongoing leasing success. We also delivered an 80 basis points expansion in occupancy to 85.9% compared to the same quarter in 2023.

謝謝，柯蒂斯。早安，感謝大家加入我們。我們第二季的積極業績包括調整後 EBITDA 較 2023 年第二季成長近 50%。我們透過減少一般管理費用和營運費用以及持續的租賃成功來實現這一成長。與 2023 年同季相比，我們的入住率也成長了 80 個基點，達到 85.9%。

Additionally, as we previously announced, we signed a non-binding agreement to sell our property at nine times square for $63.5 million, which became definitive last week. The sale of this property would reduce leverage on our balance sheet and generate net proceeds of approximately $13.5 million, strengthening our cash position.

此外，正如我們之前宣布的那樣，我們簽署了一份不具約束力的協議，以 6,350 萬美元的價格出售我們在九時代廣場的房產，該協議於上周成為最終決定。出售該房產將減少我們資產負債表上的槓桿，並產生約 1,350 萬美元的淨收益，從而增強我們的現金狀況。

While there is no guarantee that the sale will close, we continue to work with the buyer to complete the transaction. We acquired this property in 2014 for $170.3 million. Accordingly, we incurred a non-cash impairment of $84.7 million in this quarter's results. Importantly, and as we previously shared, we successfully extended our debt on this asset through year end as we worked to close this transaction.

雖然不能保證銷售一定會完成，但我們將繼續與買家合作完成交易。我們於 2014 年以 1.703 億美元收購了該房產。因此，我們在本季的業績中產生了 8,470 萬美元的非現金減損。重要的是，正如我們之前分享的那樣，隨著我們努力完成這項交易，我們成功地將這項資產的債務延長到年底。

The marketing process for the sale of 123 Williams Street and 196 Orchard is ongoing. We believe that these properties are also well positioned to generate significant net proceeds. We intend to use the proceeds from any disposition to diversify our portfolio into higher yielding assets, a strategy we discussed last year.

威廉斯街 123 號和果園 196 號的銷售工作正在進行中。我們相信這些物業也有能力產生可觀的淨收益。我們打算利用任何處置所得的收益將我們的投資組合多元化，投資於收益率更高的資產，這是我們去年討論過的策略。

We are excited to be moving forward on this initiative and look forward to the opportunity to increase value over time. While we are committed to value creation, we are focused on our current assets. As of June 30, 2024, our portfolio weighted average remaining lease term was 6.3 years as 45% of our leases extend beyond the year 2030 based on annualized straight line rent, which we believe enhances the stability of the real estate we own.

我們很高興能夠推進這項舉措，並期待著隨著時間的推移有機會增加價值。在我們致力於創造價值的同時，我們也專注於我們的現有資產。截至2024 年6 月30 日，我們的投資組合加權平均剩餘租賃期限為6.3 年，根據年化直線租金，我們的45% 的租賃期限延長到2030 年之後，我們相信這增強了我們擁有的房地產的穩定性。

Of the top 10 tenants, 81% are investment grade or implied investment grade, showing the quality of our tenant roster. These tenants had a remaining lease term of 7.9 years, providing further stability to our portfolio. We believe our proactive asset management strategy has enhanced the marketability of our $593 million, 1.2 million square foot New York City real estate portfolio.

在前 10 名租戶中，81% 為投資等級或隱含投資等級，顯示了我們租戶名冊的品質。這些租戶的剩餘租期為 7.9 年，為我們的投資組合提供了進一步的穩定性。我們相信，我們積極主動的資產管理策略增強了我們價值 5.93 億美元、面積 120 萬平方英尺的紐約市房地產投資組合的適銷性。

Concentrated primarily in Manhattan, our seven office and retail properties boast a strong tenant base, including several large investment grade firms. By focusing on resilient industries like finance and healthcare and strategically locating our properties in desirable transit oriented areas, we believe we've positioned ourselves for success.

我們的七個辦公室和零售物業主要集中在曼哈頓，擁有強大的租戶基礎，其中包括幾家大型投資級公司。透過專注於金融和醫療保健等彈性產業，並策略性地將我們的物業定位在理想的交通導向區域，我們相信我們已經為成功做好了準備。

Our second quarter results underscore the value of our consistent portfolio management approach. By prioritizing tenant retention, property enhancement and cost control, we've created a solid foundation for maximizing shareholder value. As we embark on divesting certain Manhattan assets to reduce leverage and pursue higher yielding opportunities, we are confident in our ability to execute on the strategy.

我們第二季的業績強調了我們一貫的投資組合管理方法的價值。透過優先考慮保留租戶、物業增值和成本控制，我們為股東價值最大化奠定了堅實的基礎。當我們開始剝離曼哈頓的某些資產以降低槓桿率並尋求更高收益的機會時，我們對執行該策略的能力充滿信心。

With that, I'll turn it over to Mike LeSanto to go over the second quarter results. Mike.

接下來，我將把它交給 Mike LeSanto 來檢查第二季度的業績。麥克風。

Thank you, Michael. Second quarter 2024 revenue was relatively flat as we produced $15.8 million in the second quarter of 2024 compared to $15.8 million in the second quarter of 2023. The company's GAAP net loss attributable to common stockholders was $91.9 million in the second quarter of 2024 compared to a net loss of $10.9 million in the second quarter of 2023 due primarily to the non-cash impairment Michael discussed earlier.

謝謝你，麥可。2024 年第二季的營收相對持平，2024 年第二季的營收為 1,580 萬美元，而 2023 年第二季的營收為 1,580 萬美元。該公司 2024 年第二季的 GAAP 普通股淨虧損為 9,190 萬美元，而 2023 年第二季的淨虧損為 1,090 萬美元，這主要是由於麥可先前討論的非現金減損。

For the second quarter of 2024 adjusted EBITDA was $4.5 million compared to $3 million in the second quarter of 2023. The growth was achieved through a reduction in cash paid for G&A and operating expenses coupled with our ongoing leasing success. Cash net operating income was nearly flat at $7.4 million compared to $7.5 million in the second quarter of 2023.

2024 年第二季調整後 EBITDA 為 450 萬美元，而 2023 年第二季為 300 萬美元。這一增長是透過減少用於一般管理費用和營運費用的現金以及我們持續的租賃成功來實現的。現金淨營業收入幾乎持平，為 740 萬美元，而 2023 年第二季為 750 萬美元。

As always, a reconciliation of GAAP net income to non-GAAP measures can be found in our earnings release and quarterly supplemental on our website. At quarter end, we had a relatively conservative balance sheet based on net leverage of approximately 56%, a weighted average interest rate of 4.9%, and 2.7 years of weighted average debt maturity.

像往常一樣，GAAP 淨利潤與非 GAAP 指標的對帳可以在我們網站上的收益發布和季度補充中找到。截至季末，我們的資產負債表相對保守，淨槓桿約為 56%，加權平均利率為 4.9%，加權平均債務期限為 2.7 年。

I'll now turn the call back to Michael for some closing remarks.

現在我將把電話轉回給邁克爾，讓他做一些結束語。

Thanks, Mike. Thank you all for joining us today. Our strong performance this quarter marked by increased occupancy and growing adjusted EBITDA is a direct result of our strategic portfolio management efforts.As we initiate the divestment of certain Manhattan assets, we anticipate generating substantial cash proceeds and reducing our leverage. These funds will be instrumental in expanding our portfolio into new higher yielding opportunities. We believe that this is a strategic opportunity to enhance shareholder value and are committed to providing updates on our progress.

謝謝，麥克。感謝大家今天加入我們。我們本季的強勁業績以入住率增加和調整後EBITDA 成長為標誌，這是我們策略性投資組合管理努力的直接結果。的槓桿率。這些資金將有助於將我們的投資組合擴展到新的更高收益的機會。我們相信這是一個提升股東價值的策略機遇，並致力於提供有關我們進展的最新資訊。

Operator, please open the lines for questions.

接線員，請打開提問線。

(Operator Instructions) Bryan Myers, B. Riley Securities.

（操作員指示）Bryan Myers，B. Riley Securities。

Thank you and good morning. Just a few from me this morning, Michael. You continue to be a little bit vague about the redeployment of the proceeds if and when you sell 123 William and 196 Orchard. Can you give us any color on? Are you willing to share anything more on kind of location or asset type? Has that evolved at all in a way that you can share that with us?

謝謝你，早安。邁克爾，今天早上我只提供了一些資訊。當您出售 123 William 和 196 Orchard 時，您對收益的重新分配仍然有點含糊。你能給我們任何顏色嗎？您願意分享更多有關地點或資產類型的資訊嗎？這是否已經以一種你可以與我們分享的方式發展了？

Sure. So, we obviously don't have anything specifically identified at this point as we do continue to undertake the divestment process for 123 William and 196 Orchard. But I do envision that likely deployment of assets in the New England region and real estate coupled with operating business type investments that we were precluded from touching in our prior restructure because of the operating nature of some of the businesses. And so I think that those are the types of assets and opportunities that we see fitting well within the portfolio and within our skill set.

當然。因此，我們目前顯然沒有任何具體訊息，因為我們仍在繼續進行 123 William 和 196 Orchard 的撤資程序。但我確實預計，可能會在新英格蘭地區和房地產部署資產，再加上經營業務類型的投資，而由於某些業務的經營性質，我們在先前的重組中被排除在外。因此，我認為這些是我們認為非常適合我們的投資組合和技能組合的資產和機會類型。

And as it relates to those two assets, can you share, maybe the level of interest and if you don't want to go down that road per se, do you think it's something that either or both of those properties are under contract sometime in the back half of this year or is it more likely to be the first half of next year?

由於它與這兩項資產相關，您能否分享一下，也許是興趣水平，如果您本身不想走這條路，您是否認為這兩個財產中的一個或兩個在某個時候簽訂了合約？今年下半年還是明年上半年更有可能？

Yes, we've not accepted any offers on either of those, but we have begun recently to receive offers on both and have ramped up the marketing process there. Our focus was certainly on nine times square as we had a near term debt maturity there. But I do think that it's entirely possible, if not likely, that we see both of those assets under contract by year end.

是的，我們還沒有接受這兩個方面的任何報價，但我們最近開始收到這兩個方面的報價，並加快了行銷流程。我們的重點當然是九倍方，因為我們那裡的債務近期到期。但我確實認為，我們完全有可能（即使不太可能）在年底前看到這兩項資產都處於合約狀態。

Great, that's helpful. And then on Nine Times Square, I think you said you went definitive recently on that. Do you have a hard deposit on that that the potential buyer cannot take back?

太好了，很有幫助。然後在九時代廣場，我想你說過你最近對此做出了明確的決定。您是否有潛在買家無法收回的硬押金？

We do. Yes, the buyer put up approximately 10% of the purchase price as a non-refundable deposit about a week ago, and we expect to close that transaction no later than mid-four quarter.

我們做到了。是的，買家大約一周前支付了大約 10% 的購買價格作為不可退還的押金，我們預計最遲在第四季度中期完成該交易。

Okay. And as it relates to occupancy in the quarter, 123 was down a little bit, 1140 was up a bit higher than our expectations. Anything going on with either those two properties that we should know about from a leasing standpoint?

好的。就本季的入住率而言，123 家略有下降，1140 家則略高於我們的預期。從租賃的角度來看，我們應該了解這兩個房產的哪些情況？

Yes, I think the real story of 123 is we do have a lot of interest in volume there in the works. Nothing signed or definitive at this point, but we're seeing a lot of interest in existing tenants expanding their footprint. It's kind of an organic growth of those core tenants in the property. And we do continue to see a lot of traffic at 1140, as you noted, and have a handful of leasing transactions in the works.

是的，我認為《123》的真實故事是我們確實對作品的數量非常感興趣。目前尚未簽署或確定任何內容，但我們看到現有租戶對擴大其足跡有很大興趣。這是該物業中核心租戶的有機成長。正如您所指出的，我們確實在 1140 繼續看到大量流量，並且正在進行一些租賃交易。

And then just last for me, it's kind of an open-ended question. I don't know if you saw last night CNBC did a pretty meaningfully sized piece in the evening on the prospect that office has bottomed, possibly even bottomed last year. Are you seeing any signs of this? And in general and specifically in New York, are you seeing any kind of increased interest in leasing activity in your office buildings that maybe you didn't see just a couple of quarters ago?

最後對我來說，這是一個開放式問題。我不知道你昨晚是否看到 CNBC 做了一篇相當有意義的文章，內容是關於辦公室已經觸底的前景，甚至可能在去年觸底。您看到任何跡象嗎？總體而言，特別是在紐約，您是否看到辦公大樓租賃活動的興趣增加，而您在幾個季度前可能還沒有看到這種情況？

Yes, I think that's an accurate assessment. We have seen more foot traffic, I think, in office policies have become the standard at this point that wasn't necessarily the standard 12 months ago. And so I think seeing a lot more foot traffic in the midtown and financial district markets with return to work and we're seeing more foot traffic with our existing tenants looking to expand.

是的，我認為這是一個準確的評估。我認為，我們已經看到了更多的人流量，辦公室政策已成為此時的標準，而 12 個月前不一定是標準。因此，我認為隨著重返工作崗位，中城和金融區市場的人流會增加，我們會看到現有租戶尋求擴張的人流會增加。

And I think tenants that took space during COVID or shortly after COVID are now needing additional space because of increased return to work requirements. And I think that we're starting to see some pricing come back in landlords favor over where we were six months ago.

我認為，在新冠疫情期間或新冠疫情過後不久佔用空間的租戶現在需要額外的空間，因為重返工作崗位的要求增加。我認為我們開始看到一些定價比六個月前對房東有利。

Great, good news to see here. Thanks, that's all for me.

太好了，在這裡看到好消息。謝謝，這就是我的全部。

Thanks, Bryan.

謝謝，布萊恩。

There are no further questions at this time. I would now like to turn it back over to management

目前沒有其他問題。我現在想將其轉回給管理層

for closing remarks.

作結束語。

Thank you. And again, thank you all for joining us this morning. We're excited about the quarter that we've had and what we hold in the future for us, particularly with our divestment and reinvestment strategy. And we're looking forward to sharing additional updates as we have them in future quarters. Thank you.

謝謝。再次感謝大家今天早上加入我們。我們對本季的表現以及未來的表現感到興奮，特別是我們的撤資和再投資策略。我們期待在未來幾季分享更多更新。謝謝。

Thank you. This does conclude today's conference call. You may now disconnect.

謝謝。今天的電話會議到此結束。您現在可以斷開連線。