STAG Industrial, Inc. (NYSE:STAG) Q4 2019 Earnings Conference Call - Final Transcript

Feb 13, 2020 • 10:00 am ET

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STAG Industrial, Inc. (NYSE:STAG) Q4 2019 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Greetings, ladies and gentlemen, and welcome to the STAG Industrial, Inc. Fourth Quarter 2019 Earnings Conference Call. [Operator Instructions]

It is now my pleasure to introduce your host, Matts Pinard. Thank you, sir. You may begin.

Executive
Matts S. Pinard

Thank you. Welcome to STAG Industrial's conference call covering the fourth quarter 2019 results. In addition to the press release distributed yesterday, we posted an unaudited quarterly supplemental informational presentation on the company's website at stagindustrial.com under the Investor Relations section. On today's call, the company's prepared remarks and answers to your questions will contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements address matters that are subject to risks and uncertainties that may cause actual results to differ from those discussed today. Examples of forward-looking statements include statements relating to earnings trends, G&A amounts, acquisition and disposition volumes, retention rates, debt capacity, dividend rates, industry and economic trends and other matters.

We encourage all of our listeners to review the more detailed discussion related to these forward-looking statements contained in the company's filings with the SEC, and the definitions and reconciliations of non-GAAP measures contained in the supplemental informational package available on the company's website. As a reminder, forward-looking statements represent management's estimates as of today. STAG Industrial assumes no obligation to update any forward-looking statements. On today's call, you will hear from Ben Butcher, our Chief Executive Officer; and Bill Crooker, our Chief Financial Officer.

I will now turn the call over to Ben.

Executive
Benjamin S. Butcher

Thank you, Matts. Good morning, everybody, and welcome to the fourth quarter earnings call for STAG Industrial. We're pleased to have you join us and look forward to telling you about our fourth quarter results. Presenting today in addition to myself, will be Bill Crooker, our Chief Financial Officer, who will discuss the bulk of the financial and operational data. Also with me today are Steve Mecke, our Chief Operating Officer; and Dave King, our Director of Real Estate Operations. They will be available to answer questions specific to their areas of focus. The fourth quarter concludes a historic year for Stag Industrial. We successfully executed our 2019 business plan with all of our guidance achieved or exceeded. The company is very well positioned for a great 2020. The U.S. industrial market continues to perform well.

In 2019, rents were up almost 4% in the aggregate, according to our friends at CBRE. Completions of 63 million square feet modestly edged out net absorption of 56 million square feet for the fourth quarter. For the year, the market saw a 224 million square feet of completions compared to 183 million square feet of net absorption. As a result, vacancy rose 20 basis points year-over-year to 4.4%, but still remains significantly below long-term averages. Construction activity remains robust with a pipeline of 309 million square feet of announced development. While most markets remain quite strong. There are a few submarkets with oversupply concerns. The Houston, Atlanta, Chicago and Dallas markets, our larger metros with