Orion Office REIT Inc. (NYSE:ONL) Q2 2023 Results Conference Call August 10, 2023 10:00 AM ET

Company Participants

Paul Hughes - General Counsel

Paul McDowell - Chief Executive Officer

Gavin Brandon - Chief Financial Officer

Gary Landriau - Chief Investment Officer

Chris Day - Chief Operating Officer

Operator

Greetings. Welcome to Orion Office REIT's Second Quarter 2023 Earnings Call. As a reminder, this conference is being recorded.

I would now like to turn the call over to, Paul Hughes, General Counsel for Orion. Thank you, Mr. Hughes. You may begin.

Paul Hughes

Thank you. Good morning, everyone. Yesterday, Orion released its financial results for the quarter ended June 30, 2023, filed its Form 10-Q with the Securities and Exchange Commission and posted its earnings supplement to its Web site. These documents are available in the Investor Section of the company's Web site at onlreit.com. I would like to remind everyone that certain statements [Technical Difficulty]. These statements, which include the company's guidance estimates for calendar year 2023 are based on management's current expectations and beliefs and are subject to a number of risks and uncertainties that could cause actual results to differ materially from our estimates. The risks and uncertainties are discussed in our earnings release as well as in our Form 10-Q and other SEC filings. You should not place undue reliance on these forward-looking statements, and the company undertakes no duty to update any forward-looking statements made during this call. Additionally, during the conference call today, we will be discussing certain non-GAAP financial measures, such as funds from operations or FFO and core funds from operations or core FFO. Company's earnings release and supplement include a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP measure. Our presentation of this information is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with GAAP. Hosting the call today are Paul McDowell, the company's Chief Executive Officer; and Gavin Brandon, the company's Chief Financial Officer. And joining us for the Q&A session is Gary Landriau, our Chief Investment Officer; and Chris Day, our Chief Operating Officer.

With that, I am now going to turn the call over to Paul McDowell. Paul?

Paul McDowell

Good morning, everyone. And welcome to Orion Office REIT’s second quarter 2023 earnings call. On behalf of our team, I want to thank you all for joining us today. I will discuss our performance and operations for the second quarter and highlight our continued progress in executing on our business strategy. I will then turn the call over to Gavin to provide an update on our financial results and on our outlook for the rest of the year. We would certainly welcome an acceleration in the pace of office utilization and leasing momentum. But since we cannot control that timing, we remain focused on executing our strategy to reposition the portfolio of properties we inherited in 2021 from Orion's spinoff from Realty Income. The economic backdrop for commercial real estate and specifically for the office sector remains difficult. At Orion, we are continuing to take proactive steps to reinforce our capital structure to support the necessary investments in our core portfolio in the form of building improvement allowances and lease incentives to retain tenants and extend our portfolio's weighted average lease term, produce sustained cash flows and ultimately position the company to grow. With that in mind, the most important news for us in the quarter was that we successfully secured an amendment to our credit agreement, which retired our term loan ahead of schedule, gives us continued access to significant liquidity and the ability to extend the revolver loan term well into 2026. Gavin will provide a few more details but we appreciate the continued support of Orion and our business plan by all our lenders that allowed us to close this amendment in the midst of a tight credit market and challenging financing environment for office properties.