Financial Data and Key Metrics Changes - For Q4 2025, total revenues were $35.2 million, down from $38.4 million in Q4 2024. Core FFO was $0.19 per share compared to $0.18 per share in the prior year [17] - For the full year 2025, total revenues were $147.6 million, down from $164.9 million in 2024. Core FFO was $0.78 per share, which included approximately $0.09 per share of lease terminations [19] - Adjusted EBITDA for 2025 was $69 million, compared to $82.8 million in 2024 [19] - G&A expenses for 2025 were $20.3 million, slightly up from $20.1 million in 2024 [19] Business Line Data and Key Metrics Changes - In 2025, the company completed over 900,000 sq ft of leasing, following 1.1 million sq ft in 2024, indicating an improving market backdrop [4] - The average weighted average lease term (WALT) for new leases signed in 2025 was nearly 10 years, almost double the portfolio average WALT [5] - Cash rent spreads for Q4 renewals were up 12.8%, although overall rent spreads for 2025 were down 7.1% [6] Market Data and Key Metrics Changes - The lease rate improved by 600 basis points year-over-year to over 80% at year-end, with occupancy rate improving by 500 basis points to 78.7% [6] - The company entered 2026 with scheduled lease expirations totaling $11.4 million of Annualized Base Rent, down from $16.2 million in 2025 [7] Company Strategy and Development Direction - The company is undergoing a strategic options review to explore pathways to unlock shareholder value [4] - There is a focus on shifting portfolio concentration away from traditional suburban office properties towards dedicated use assets (DUAs) [11] - The company aims to improve portfolio quality, lengthen WALT, renew tenants, and fill vacant space while managing leverage prudently [16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in standalone prospects and expects Core FFO to grow meaningfully in the coming years as the portfolio stabilizes [15] - The leasing momentum is seen as a result of an improving market, with a robust pipeline of over 1 million sq ft in discussion or documentation stages [7] - The company anticipates that 2025 represented a trough for Core FFO, with expectations for improvement in 2026 [29] Other Important Information - The company sold 10 properties in 2025 for approximately $81 million, including additional sales of vacant properties in early 2026 [8][9] - A new $215 million secured revolving facility was established, maturing in February 2029, providing financial flexibility [14] - The board declared a quarterly cash dividend of $0.02 per share for Q1 2026 [28] Q&A Session Summary Question: Is the leasing pipeline reflecting an overall improvement in office leasing? - Management indicated that the leasing momentum is a result of both market improvement and increased activity within their portfolio [31] Question: What is the historical success rate of converting the leasing pipeline into signed leases? - Management noted that their success rate has significantly improved over the past two years, with a notable increase in leasing activity [32] Question: Can you provide context on the Barilla transaction? - The transaction was brokered and involved a property that includes test kitchens and R&D facilities, with about half being office space [34][35] Question: What is the pace of disposing of remaining vacant properties? - Management stated that while they have sold a significant number of properties, they will evaluate future vacancies on a case-by-case basis [38] Question: What opportunities do upcoming lease maturities present? - Management expects Core FFO to grow as the portfolio stabilizes, although renewal rent increases may vary based on market conditions [41]