W. P. Carey Inc. (NYSE:WPC) Q3 2020 Earnings Conference Call - Final Transcript

Oct 30, 2020 • 10:00 am ET


W. P. Carey Inc. (NYSE:WPC) Q3 2020 Earnings Conference Call - Final Transcript


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Hello, and welcome to W. P. Carey's Third Quarter 2020 Earnings Conference Call. My name is Brock, and I will be your operator today. [Operator Instructions]

I will now turn today's program over to Peter Sands, Director of Institutional Investor Relations. Mr. Sands, please go ahead.

Peter Sands

Good morning, everyone. Thank you for joining us today for our 2020 third quarter earnings call.

Before we begin, I would like to remind everyone that some of the statements made on this call are not historic facts and may be deemed forward-looking statements. Factors that could cause actual results to differ materially from W. P. Carey Inc. expectations are provided in our SEC filings. An online replay of this conference call will be made available in the Investor Relations section of our website at wpcarey.com, where it will be archived for approximately one year and where you can also find copies of our investor presentations and other related materials.

And with that, I'll hand the call over to our Chief Executive Officer, Jason Fox.

Jason E. Fox

Thank you, Peter, and good morning, everyone. I hope everyone remains safe and well during this period in which we've grown accustomed to working remotely and managing through the COVID-19 pandemic. I'm pleased to say that we resumed external acquisition activity during the third quarter. And through a combination of ample liquidity and an advantaged cost of capital, we're very well positioned to execute on our growing pipeline of investment opportunities.

We've reinstated formal guidance, which our CFO, Toni Sanzone, will review, along with our third quarter results as well as touching upon aspects of our portfolio and balance sheet. Toni and I are joined today by John Park, our President; and Brooks Gordon, our Head of Asset Management, who are here to take questions later in the call.

The third quarter posed another stress test for net lease REITs, during which our portfolio has continued to show remarkable resilience and consistency with rent collections that remain among the best in the net lease peer group as well as the broader REIT sector. Overall, we collected 98% of rents due during the third quarter. Our collections again showed consistent strength across each of the three months, across our core property types, including retail, for which we collected 100% of third quarter rents and across the US and European portfolios.

Furthermore, to date, all of our top 10 tenants have remained 100% current on rent throughout the pandemic. And I'm pleased to say the overall strength of our collections has continued in the fourth quarter with a 99% collection rate for rent due in October. This is a testament to our underwriting process, focused on deep credit underwriting and mission-critical assets as well as the expertise of our investments and asset management teams.

W. P. Carey's portfolio generates rental income that is more reliable, and therefore, more valuable than that of REITs with weaker or more variable collections. The downside protection this provides is a differentiating factor that we believe the