Financial Data and Key Metrics Changes - For Q1 2025, funds from operations (FFO) were reported at $0.68 per fully diluted share, an increase from $0.60 per share in Q1 2024, indicating a positive trend in financial performance [22] - Cash same-store rental growth for the quarter, excluding termination fees, was 10.1%, driven by increases in rental rates and higher average occupancy [22][23] - In-service occupancy at the end of the quarter was 95.3%, a decrease of 90 basis points from year-end and 20 basis points from the year-ago quarter [22][23] Business Line Data and Key Metrics Changes - The company achieved a cash rental rate increase of 30% for new and renewal leasing, with a projected growth of 30% to 40% for the full year [15][29] - Development leasing included a successful expansion of a tenant in Denver, bringing a 200,000 square foot building to 100% occupancy [16] - The company plans to break ground on a 176,000 square foot facility in Dallas, targeting a cash yield of approximately 8% [17] Market Data and Key Metrics Changes - Nationally, vacancy in Tier 1 U.S. markets was reported at 5.9%, unchanged since year-end [12] - Net absorption was 56 million square feet, with 24 million square feet occurring in the company's target markets [12] - New construction starts were 75% lower than the peak in Q3 2022, with only 54 million square feet breaking ground in Q1 [13] Company Strategy and Development Direction - The company is focused on executing objectives to drive long-term cash flow growth while monitoring the impact of tariffs on tenant demand [30] - The strategy includes remaining opportunistic in new investments, particularly in markets like Texas, Florida, and Pennsylvania [50] - The company aims to capitalize on unmet demand in specific sub-markets while being cautious due to tariff uncertainties [50] Management's Comments on Operating Environment and Future Outlook - Management expressed that the evolving landscape surrounding tariffs poses potential risks to business activity and leasing markets [10][11] - The company remains optimistic about its leasing objectives and has seen increased activity in tenant requests for proposals (RFPs) despite tariff concerns [47][75] - Management noted that while some conversations have paused, the overall interest and demand for space remain strong [88][90] Other Important Information - The company renewed its senior unsecured revolving credit facility by $100 million, extending the maturity date to March 2030 [24] - The company acquired two fully leased developments in Phoenix for a total basis of $120 million, with a cash yield of 6.4% [20] - The company expects to capitalize about $0.09 per share of interest for the full year of 2025 [29] Q&A Session Summary Question: Impact of tariffs on tenancy perspective - Management indicated that exposure to Chinese 3PLs is minimal, with only 450,000 square feet leased to them, and no significant concerns from auto tenants [35][37] Question: Development leasing visibility - Management confirmed that the majority of development leasing is still expected in Q4, with good activity in the market despite some tenant concerns [41][46] Question: G&A expenses related to stock-based compensation - Management acknowledged an increase in G&A due to accelerated stock-based compensation but did not provide specific figures during the call [55] Question: Current tenant activity and leasing velocity - Management noted that while some tenants have paused decisions, the overall interest remains strong, and many are still moving forward with leasing [88][90] Question: Development starts and market conditions - Management confirmed that the two new developments planned for Q2 are proceeding as they cater to local demand, despite current market uncertainties [144][145] Question: Amazon's expansion and RFPs - Management observed that Amazon is focused on enhancing same-day delivery capabilities and is active in several markets, indicating a shift in their approach to warehousing [161][162]