Pennsylvania Real Estate Investment Trust (PEI) 2022 Q3 法說會逐字稿

Good morning. My name is Chris, and I'll be your conference operator today. At this time, I'd like to welcome everyone to the PREIT Third Quarter 2022 Earnings Call. (Operator Instructions)

早安.我叫克里斯，今天我將擔任你們的會議操作員。此時，我謹歡迎大家參加 PREIT 2022 年第三季財報電話會議。 （操作員說明）

Heather Crowell, you may begin.

希瑟·克羅威爾，你可以開始了。

Thank you. Good morning, and thank you all for joining us for PREIT's Third Quarter 2022 Earnings Call. During this call, we will make certain forward-looking statements within the meaning of federal securities laws. These statements relate to expectations, beliefs, projections, trends and other matters that are not historical facts and are subject to risks and uncertainties that might affect future events or results. Descriptions of these risks are set forth in the company's SEC filings. Statements that PREIT makes today might be accurate only as of today, November 8, 2022, and PREIT makes no undertaking to update any such statements.

謝謝。早安，感謝大家參加 PREIT 的 2022 年第三季財報電話會議。在本次電話會議中，我們將做出聯邦證券法意義內的某些前瞻性聲明。這些陳述涉及預期、信念、預測、趨勢和其他非歷史事實的事項，並受到可能影響未來事件或結果的風險和不確定性的影響。該公司向 SEC 提交的文件中對這些風險進行了描述。 PREIT 今天所做的聲明可能僅截至今天（2022 年 11 月 8 日）準確，且 PREIT 不承諾更新任何此類聲明。

Also, certain non-GAAP measures will be discussed. PREIT has included reconciliations of such measures to the comparable GAAP measures in its earnings release and other documents filed with the SEC. We continue to partner with Say Technologies to offer an opportunity for any shareholder to ask questions of management. During this call, management will answer questions received over the Q&A platform. We thank our investor base for their engagement in this process.

此外，也將討論某些非公認會計原則措施。 PREIT 已在其收益報告和向 SEC 提交的其他文件中納入了此類措施與可比較 GAAP 措施的調節。我們繼續與 Say Technologies 合作，為任何股東提供向管理層提問的機會。在這次電話會議中，管理層將回答透過問答平台收到的問題。我們感謝我們的投資者群體參與這一過程。

Members of management on the call today are Joe Coradino, PREIT's Chairman and CEO; and Mario Ventresca, CFO. Joe?

今天參加電話會議的管理層成員包括 PREIT 董事長兼執行長 Joe Coradino；和財務長 Mario Ventresca。喬？

Thank you, Heather, and good morning, everyone. As we sit here today, we're in a significantly improved position as compared to last quarter. We've now executed on the sale of over $110 million in assets, paid down $148 million in debt, sent notice electing the extension of our credit facility maturity dates and satisfied the recent re-margin requirement on Fashion District Philadelphia. Add to this, we have a pipeline of over $130 million of assets that are under agreement and many in the final stages in negotiations while we are exploring opportunities to raise an additional $125 million in capital.

謝謝你，希瑟，大家早安。當我們今天坐在這裡時，與上個季度相比，我們的處境有了顯著改善。我們現在已經出售了超過 1.1 億美元的資產，償還了 1.48 億美元的債務，發出了選擇延長信貸額度到期日的通知，並滿足了費城時尚區最近的重新保證金要求。除此之外，我們還有超過 1.3 億美元的資產正在達成協議，其中許多資產正處於談判的最後階段，同時我們正在探索籌集額外 1.25 億美元資本的機會。

As we look at realizing everything in process, in addition to the work we've done, pairing the portfolio, replacing department stores, diversifying our tenant mix, we sit here in a position where we have created a portfolio of high-quality assets that are delivering strong sales in markets that have high barriers to entry where we have overtaken the competition.

當我們著眼於實現進程中的一切時，除了我們已經完成的工作外，配對投資組合、更換百貨公司、使我們的租戶組合多樣化，我們現在已經創建了一個優質資產組合，在進入壁壘較高的市場中，我們的銷售強勁，我們已經超越了競爭對手。

Our success in asset dispositions and qualifying for our credit facility extension are a function of our laser-sharp focus on operational performance, where we have outperformed our peers in many quarters. We generated strong same-store NOI results tied to significant occupancy gains following last year's record leasing activity. As occupancy increases, we're seeing a shift in pricing power, as evidenced by our improved renewal spreads.

我們在資產處置和獲得信貸延期方面的成功得益於我們對營運績效的高度關注，我們在許多季度的表現都優於同業。繼去年創紀錄的租賃活動之後，我們取得了強勁的同店 NOI 業績，這與入住率的顯著成長有關。隨著入住率的增加，我們看到定價能力發生了變化，我們的續訂利差改善證明了這一點。

We've been at the forefront of selling assets that didn't meet reasonable growth profile. We have proactively replaced anchors so that we don't just sit with vacant boxes throughout our portfolio. We've added critical elements to the mix, dining every form of retail, including formats less found in malls. We have grocery anchors in 1/3 of our malls. 12% of our portfolio is off-price and fast fashion. We have 2 medical facility anchors, and 14% of the portfolio is dining and entertainment. So we have distinguished our portfolio from traditional malls as we continue to evolve our properties to sit at the intersection of life and commerce, taking key steps to broaden customer appeal, enhancing the value of our assets.

我們一直處於出售不符合合理成長狀況的資產的最前線。我們已經主動更換了錨點，這樣我們就不會在整個投資組合中坐以待斃。我們在組合中加入了關鍵元素，涵蓋各種零售形式，包括商場中較少見的形式。我們 1/3 的購物中心設有雜貨店。我們的產品組合中有 12% 是折扣和快時尚。我們有 2 個醫療設施主力，其中 14% 的投資組合是餐飲和娛樂。因此，我們將我們的投資組合與傳統購物中心區分開來，我們不斷發展我們的物業，使其處於生活和商業的交叉點，採取關鍵措施擴大客戶吸引力，提高我們資產的價值。

Moorestown Mall is a great example of reshaping our traditional mall assets that are in competitive retail environments. The mall offers a true community hub complete with dining, entertainment, fitness offerings, including Planet Fitness and Orangetheory Fitness, a value retail collection, including HomeSense, Sierra, Five Below and Michaels and now under construction, our Cooper University Health Care and a 375-unit apartment complex. Keep in mind, these are replacing a vacant Sears and underutilized land.

Moorestown 購物中心是在競爭激烈的零售環境中重塑傳統購物中心資產的一個很好的例子。購物中心提供真正的社區中心，提供餐飲、娛樂、健身服務，包括Planet Fitness 和Orangetheory Fitness，還有價值零售系列，包括HomeSense、Sierra、Five Below 和Michaels（目前正在建設中）、我們的庫珀大學醫療保健中心和375 - 單元公寓大樓。請記住，這些正在取代空置的西爾斯和未充分利用的土地。

At Springfield Town Center, construction for LEGO Discovery Center is underway with an opening expected next year. The first of its new prototype in the United States, this is a key step in transforming the property into a vibrant multiuse hub, creating the preeminent family entertainment destination in the DC market. In addition to the upcoming opening of LEGO, the proposed apartment and hotel developments will strengthen the properties appeal to customers and prospective tenants.

在斯普林菲爾德鎮中心，樂高探索中心的建設正在進行，預計明年開幕。這是其在美國的第一個新原型，是將酒店轉變為充滿活力的多用途中心、在華盛頓市場打造卓越家庭娛樂目的地的關鍵一步。除了即將開業的樂高之外，擬議的公寓和酒店開發項目還將增強酒店對客戶和潛在租戶的吸引力。

The strength of Cherry Hill Malls brand continues to gain momentum, leading our portfolio and securing new tenants. In addition to the earlier openings of first Warby Parker and [Mark Kane], we've executed leases for other first-to-portfolio tenants, Levi's, Psycho Bunny and Eddie V's. With sales over $900 per square foot, these new tenants continue to cement the property status among the most elite malls in the country.

Cherry Hill Malls 品牌的實力持續增強，引領我們的產品組合併吸引新租戶。除了早期開業的第一家 Warby Parker 和 [Mark Kane] 之外，我們還為其他首批入駐的租戶，Levi's、Psycho Bunny 和 Eddie V's 簽訂了租賃合約。這些新租戶的銷售額超過每平方英尺 900 美元，繼續鞏固其在全國最精英購物中心中的地位。

At Willow Grove Park, construction is underway for Tilted 10, bringing a family entertainment center featuring laser tag, bowling, mini golf, virtual reality, pinball and over 200 games and attractions to the property.

在 Willow Grove 公園，Tilted 10 正在建設中，該項目將打造一個家庭娛樂中心，提供雷射標籤、保齡球、迷你高爾夫、虛擬現實、彈珠以及超過 200 個遊戲和景點。

Through 3 quarters of the year, heading into what is predicted to be a robust holiday season, same-store NOI, FFO, occupancy, leasing spreads are strong. Sales are above pre-pandemic levels. Our tenant mix is healthier than in years past, and we have a pipeline of nearly $7 million of revenue that is signed but not yet open. With occupancy stabilizing and strong sales, we believe we can further drive rents, enhancing portfolio value.

全年三個季度，預計將迎來強勁的假期季，同店 NOI、FFO、入住率、租賃價差均強勁。銷售額高於大流行前的水平。我們的租戶組合比過去幾年更加健康，我們有近 700 萬美元的收入管道已簽約但尚未開放。隨著入住率穩定且銷售強勁，我們相信我們可以進一步提高租金，提高投資組合價值。

Now it's worth taking a moment to understand where we are through the lens of where we came from. We laid out a strategy to markedly improve the quality of the portfolio, to make it bulletproof, disposing the properties in secondary and tertiary markets to improve our operating results and our balance sheet, and we did that.

現在值得花點時間透過我們來自哪裡的視角來了解我們現在在哪裡。我們制定了一項策略，以顯著提高投資組合的質量，使其防彈，在二級和三級市場上處置房產，以改善我們的經營業績和資產負債表，我們做到了。

Next, we had to confront a wave of department store consolidation. We did that, arguably better than anyone else. We replaced and remerchandised 19 department stores into 40 tenants, began to incorporate apartments, hotels, medical facilities and grocers while completing major redevelopments, positioning the company for significant growth. Then we were confronted with an unanticipated pandemic, that required quick decisive action to manage the impacts on all of our stakeholders, including restructuring our debt, embarking on a material asset sale program and continuously improving our results. We did that, too.

接下來，我們不得不面對百貨公司整合的浪潮。我們做到了，可以說比其他人做得更好。我們將 19 家百貨公司替換為 40 家租戶，並重新銷售，開始納入公寓、飯店、醫療設施和雜貨店，同時完成重大重建，為公司的顯著成長奠定了基礎。然後，我們遇到了一場意想不到的大流行，需要迅速採取果斷行動來管理對所有利益相關者的影響，包括重組我們的債務、啟動重大資產出售計劃以及不斷改善我們的業績。我們也這麼做了。

Now we find ourselves facing economic upheaval, rising rates, inflation, a constrained financing environment. Having said all of that, we've dramatically improved the portfolio in high barrier-to-entry markets that are irreplaceable. And our plan, and I repeat, and our plan is to spend the coming year exploring all possible options available to the company as our credit facility matures, including refinancing, merger, sale, joint ventures, selling high-quality assets and more. Remember, we've successfully met every challenge, and our intention is to conclude this challenge saying, we did that.

現在我們發現自己面臨經濟動盪、利率上升、通貨膨脹和融資環境受限。話雖如此，我們已經大大改善了不可替代的高進入障礙市場的投資組合。我們的計劃，我再說一遍，我們的計劃是在未來的一年裡，隨著我們的信貸安排的成熟，探索公司可用的所有可能選擇，包括再融資、合併、出售、合資、出售優質資產等等。請記住，我們已經成功應對了每一項挑戰，我們的目的是在結束這項挑戰時說：我們做到了。

Now I'll turn it over to Mario to provide further insight into our performance and accomplishments.

現在我將把它交給 Mario，以進一步了解我們的表現和成就。

Thanks, Joe. We continue to see strong business fundamentals in the third quarter, while at the same time, monitoring the evolving economic environment. Liquidity is tracking ahead of our original business plan at $113 million, and we delivered a third quarter same-store NOI increase, excluding lease terminations of 3.3% and 3.5% year-to-date.

謝謝，喬。我們繼續看到第三季強勁的業務基本面，同時監控不斷變化的經濟環境。流動性超出了我們最初的業務計劃，達到 1.13 億美元，並且我們實現了第三季同店 NOI 成長（不包括年初至今 3.3% 和 3.5% 的租賃終止）。

Leasing volume is strong and compares favorably to 2019. During the third quarter, we executed new leases for 28% more square footage than in the third quarter of 2019. And this quarter, we executed renewal leases, covering 75% more gross leasable area than in the third quarter of 2019. Year-to-date, leasing volume has exceeded 2019 by 23%, building upon last year's phenomenal new leasing activity that has driven substantial increases in occupancy.

租賃量強勁，與2019 年相比表現良好。第三季度，我們執行的新租賃面積比2019 年第三季度增加了28%。本季度，我們執行了續租，可出租總面積比2019 年第第三季增加了75% 2019 年第三季。今年以來，租賃量已比 2019 年成長 23%，去年驚人的新租賃活動推動了入住率大幅成長。

During the quarter, we signed 375,000 square feet of new and renewal leases. We currently have a pipeline of 300,000 square feet signed for future occupancy, representing approximately $7 million in annualized future rents.

本季度，我們簽署了 375,000 平方英尺的新租約和續約租約。目前，我們已簽署了 30 萬平方英尺的待租用地，相當於未來年租金約 700 萬美元。

This morning, we reported third quarter 2022 NAREIT FFO and FFO as adjusted of negative $1.13 per share. For the 9-month period, NAREIT FFO was $0.38 per share and FFO as adjusted was negative $0.30 per share. The primary drivers of the variance to 2021 actuals for the third quarter were: a decrease in G&A expenses of $3.5 million, primarily driven by a decrease in people costs; interest expense increased by $4.3 million due to higher interest rates and an increase in the second lien term loan and FDP partnership loan balances; same-store NOI increased by $1.5 million, but was offset by a decrease of $1.2 million in non-same-store NOI, following the sale of our interest in Gloucester Premium Outlets and a decrease of $700,000 in lease termination revenue.

今天早上，我們報告了 2022 年第三季 NAREIT FFO 和 FFO 調整後每股負 1.13 美元。在這 9 個月期間，NAREIT FFO 為每股 0.38 美元，調整後的 FFO 為每股負 0.30 美元。與 2021 年第三季實際狀況差異的主要驅動因素是： 一般及行政費用減少 350 萬美元，主要是由於人員成本的下降；由於利率上升以及第二留置權定期貸款和 FDP 合夥貸款餘額增加，利息支出增加了 430 萬美元；同店 NOI 增加了 150 萬美元，但被出售格洛斯特名牌折扣購物中心權益後非同店 NOI 減少 120 萬美元以及租賃終止收入減少 70 萬美元所抵消。

The gain on sale of $1.8 million from the sale of the Sears tire and battery at Moorestown positively impacted the third quarter of 2022. Same-store NOI, excluding lease termination revenues, was 3.3% higher than in the comparable 2021 quarter and increased 3.5% on a year-to-date basis. This was driven primarily by increased rents, strong tenant sales performance and common area revenues.

在穆爾斯敦銷售 Sears 輪胎和電池帶來的 180 萬美元銷售收益對 2022 年第三季度產生了積極影響。同店 NOI（不包括租賃終止收入）比 2021 年同期增長 3.3%，增長 3.5%年初至今。這主要是由租金上漲、租戶銷售業績強勁和公共區域收入所推動的。

Core Mall sales were $598 per square foot, excluding Cumberland, which compares favorably to pre-pandemic sales of $539 per square foot. Some other noteworthy achievements for the quarter. Core Mall occupancy was 94.4% versus 89.6% at the end of the third quarter of 2021. This was an improvement of 480 basis point. Core Mall in-line occupancy was 91.4%, a 310 basis point improvement over the third quarter of 2021 and a sequential improvement of 90 basis points. Total leased occupancy, which captures the volume of our leasing pipeline, is exceptional at 95.6%, and renewal spreads showed marked improvement at 8.7%. This reflects our best quarter since the fourth quarter of 2017.

核心購物中心 (Core Mall) 的銷售額為每平方英尺 598 美元，不包括坎伯蘭 (Cumberland)，這比疫情前每平方英尺 539 美元的銷售額要好。本季其他一些值得注意的成就。 Core Mall 的入住率為 94.4%，而 2021 年第三季末為 89.6%。提高了 480 個基點。核心商城排隊入住率為 91.4%，較 2021 年第三季提高 310 個基點，較上季提高 90 個基點。總租賃入住率（反映了我們的租賃通路量）達到了 95.6%，非常出色，續租利差顯著改善，達到 8.7%。這是我們自 2017 年第四季以來最好的季度。

As Joe discussed, we have an active few months -- we've had an active few months of asset sales, and during the quarter, notice for the extension of our credit facility maturity dates has been issued to our lending group. Specifically, we ended the second quarter, the initial measurement point for the credit facility extension with a corporate debt yield well above the 8% minimum requirement, and our third-party appraisals for the borrowing base properties indicated a loan-to-value significantly below the 105% maximum. We also achieved liquidity well in excess of the $35 million minimum requirement.

正如喬所討論的，我們有幾個月的活躍期——我們有幾個月的資產銷售活躍期，在本季度，我們已向我們的貸款團隊發出了延長信貸便利到期日的通知。具體來說，我們在第二季結束時，在信貸額度延期的初始衡量點上，企業債務收益率遠高於8% 的最低要求，而我們對借款基礎資產的第三方評估顯示，貸款價值比顯著低於最大 105%。我們的流動性也遠遠超過了 3500 萬美元的最低要求。

As we look forward, we continue to be focused on generating organic revenue growth while selling assets opportunistically to reduce debt and interest expense with the goal of driving earnings growth in the future. We are pleased that we have made real progress this quarter, submitting notice for our extension, extending our mortgage on Cherry Hill and accelerating our asset sales program.

展望未來，我們將繼續專注於實現有機收入成長，同時趁機出售資產以減少債務和利息支出，以推動未來獲利成長。我們很高興本季取得了真正的進展，提交了延期通知，延長了 Cherry Hill 的抵押貸款並加速了我們的資產銷售計劃。

With that, we'll now move to the questions that we've received previously.

至此，我們現在將討論之前收到的問題。

Thank you. The first question is, does the leasing environment continue to be strong and are inquiries and signed leases increasing with each passing month? How are the lease rates holding up, especially considering inflation?

謝謝。第一個問題是，租賃環境是否持續強勁，詢價和簽訂的租約是否逐月增加？租賃率如何維持，特別是考慮通貨膨脹？

As we noted in our prepared remarks, we have 300,000 square feet of new leases executed for future openings, which will generate $7 million of additional annual revenue. Regarding lease rates, our leasing spreads this quarter were the highest in over 4 years. We're excited to open stores with many new-to-portfolio tenants, including BoxLunch, Lovisa, Rose & Remington, JD Sports and more.

正如我們在準備好的演講中指出的那樣，我們為未來的開業簽署了 30 萬平方英尺的新租約，這將產生 700 萬美元的額外年收入。就租賃費率而言，本季我們的租賃利差是四年多來最高的。我們很高興能與許多新租戶合作開設商店，包括 BoxLunch、Lovisa、Rose & Remington、JD Sports 等。

The next question is, what's the projection for 2024?

下一個問題是，2024 年的預測是什麼？

Yes. While we haven't released guidance, our operating momentum does continue to be strong, and we have a pipeline of $7 million of lease revenue signed, but not yet open.

是的。雖然我們尚未發布指導意見，但我們的營運勢頭確實繼續強勁，我們已經簽署了 700 萬美元的租賃收入管道，但尚未開放。

Next question, when will you discuss reinstating dividend?

下一個問題，你們什麼時候討論恢復股息？

As we've previously discussed, our credit facility currently prohibits paying dividends unless it is required to maintain REIT status.

正如我們之前討論的，我們的信貸安排目前禁止支付股息，除非需要維持房地產投資信託基金的地位。

As a shareholder who purchased common shares in PREIT prior to the pandemic, I'm counting on management to avoid further trip to court supervised restructuring. If needed, we'll presell additional malls to further reduce debt, as painful as that may be.

作為一個在大流行之前購買 PREIT 普通股的股東，我指望管理層避免進一步訴諸法院監督重組。如果需要，我們將預售更多購物中心以進一步減少債務，儘管這可能會很痛苦。

As we noted, we will conclude submission of our documentation for our as-of-right credit facility extension, which will become effective on December 10. During the coming year, we will be exploring all possible options available to the company as our credit facility matures, including refinancing, merger, sale, joint ventures, selling high-quality assets and other initiatives.

正如我們所指出的，我們將完成對現有信貸便利延期的文件提交，該文件將於 12 月 10 日生效。在來年，我們將探索公司可用的所有可能選項作為我們的信貸便利成熟的舉措包括再融資、併購、出售、合資、出售優質資產等措施。

Have rising interest rates made it more difficult for you to negotiate new loans or extensions of existing loans? How much do you expect annual interest payments will increase with higher rates on new loan agreements?

利率上升是否使您更難談判新貸款或延長現有貸款？隨著新貸款協議利率的提高，您預計年利息支付將增加多少？

Well, we think the financing challenges that all real estate owners are experiencing is related to more than just interest rates. We see tighter underwriting standards, valuation uncertainty and negative undertones regarding certain sectors have led to virtually frozen credit markets.

嗯，我們認為所有房地產所有者所面臨的融資挑戰不僅僅與利率有關。我們看到更嚴格的承保標準、估值不確定性和某些行業的負面影響導致信貸市場幾乎凍結。

That being said, we're hopeful that some of the factors at play are temporary, including the political uncertainty, and that the path forward will improve underlying today's election. We're optimistic that factors impacting credit markets will ease in the next few weeks, yielding a more favorable lending environment.

話雖這麼說，我們希望一些起作用的因素是暫時的，包括政治不確定性，並且未來的道路將在今天的選舉中得到改善。我們樂觀地認為，影響信貸市場的因素將在未來幾週內緩解，從而產生更有利的貸款環境。

Okay. With the current high interest rate environment, has it been harder to find buyers for your properties? Also, has the selling price of properties been lower than expected because of the higher rates?

好的。在目前的高利率環境下，您的房產是否更難找到買家？另外，由於利率上升，房產的售價是否低於預期？

Just last week, we completed the sale of Cumberland Mall for $45 million, which allowed us not only to repay the property mortgage but also apply excess proceeds to reduce our credit facility balance. We continue to have a strong pipeline of asset sales with $130 million under contract. We're at the final stages of negotiation.

就在上週，我們以 4500 萬美元的價格完成了坎伯蘭購物中心 (Cumberland Mall) 的出售，這使我們不僅可以償還房產抵押貸款，還可以使用多餘的收益來減少我們的信貸額度餘額。我們繼續擁有強大的資產銷售管道，合約金額達 1.3 億美元。我們正處於談判的最後階段。

That concludes the question-and-answer period. And I think we'll turn it over to Joe for closing.

問答環節到此結束。我想我們會把它交給喬結束。

Yes. With that, thank you, Heather, thank you, Mario, and thank you all for participating on the call today. Just to reiterate, our plan is to spend the coming year, exploring all possible options available to the company as our credit facility matures, including refinancing, merger, sale, joint ventures or selling high-quality assets and more.

是的。在此，謝謝你，希瑟，謝謝你，馬裡奧，並感謝大家參加今天的電話會議。重申一下，我們的計劃是在未來的一年裡，隨著信貸額度的成熟，探索公司可用的所有可能選擇，包括再融資、合併、出售、合資或出售優質資產等。

Again, thank you all for participating today.

再次感謝大家今天的參與。

Ladies and gentlemen, this concludes today's conference call. Thank you for participating, and you may now disconnect.

女士們、先生們，今天的電話會議到此結束。感謝您的參與，您現在可以斷開連接。