Thank you and good morning, everyone. Before we begin, please note that forward-looking statements may be made during this discussion. Such statements involve known and unknown risks and uncertainties, which may cause actual results to differ materially, and we undertake no duty to update them as actual events unfold. We refer to certain of these risks in our SEC filings.

Thank you, Drew, and I appreciate you filling in for Amy on this call today while she's out. Good morning, everyone, and thanks for joining us today. Last evening, we released our first quarter earnings results, which reflect performance that was in line with our expectations. We are pleased to report that the gradual rebound in demand across our multifamily and commercial properties that commenced in January continued throughout the first quarter and into April. Looking ahead, we remain optimistic about the accelerating vaccine deployment, which we anticipate will translate to increased visibility on our near-term performance, allowing us to reinstate full year FFO guidance. We are now heading into the spring multifamily leasing season and urban demand continues to rebound, while our suburban portfolio fundamentals remain strong. Pricing trends are improving and both the volume of concessions and average concession amount per unit continues to decline. We expect multifamily rents to show steady improvement as urban markets recover and concessions decline and burn off. Trove continues to lease up with increasing momentum, reaching 51% leased this week and remains on track to stabilize in the second quarter of 2022. Over the long term, our value-oriented multifamily portfolio is positioned very well with favorable supply and demand fundamentals. From a demand perspective, the Washington metro region has a significant housing shortage that has been accumulating over many years and an affordability crisis that is only getting worse as the cost of homeownership continues to rise above affordable levels for median-income earners. And from a supply perspective, while Class A supply has been growing, the majority of renters remain underserved by new supply because our region has not been producing housing product at the price point that would address the growing demand. Therefore, we expect demand for our value-oriented multifamily units, which are priced to target the largest, most underserved renter cohorts to benefit from having a large and growing target market and limited competitive supply over the long term. In commercial, both new and renewal leasing activity have picked up significantly thus far this year.

Thank you, Paul, and good morning, everyone. I'll start off today with a quick update on our balance sheet and collection performance before discussing our first quarter financial performance and future outlook. Our balance sheet remains strong with no debt maturities until the fourth quarter of 2022, and we've maximized liquidity. Last year, we took steps to strengthen our balance sheet and increase our operational flexibility, putting us in a strong position that we are today. At quarter end, we only had $33 million outstanding on our fully available $700 million line of credit, and all of our covenant ratios remain strong. Now I'll turn to our cash collection performance. Our multifamily collections continue to be excellent, tracking well above national averages. We collected over 98% of cash and contractual rents during the first quarter, and our rent collections through April are in line with our quarterly trend. Our office and retail collections remain strong. We collected 99% of office contractual rents, which excludes rents that have been deferred and 99% of office cash rents during the first quarter. Cumulative net deferred rent associated with office tenants declined to $700,000 as of March 31, 2021. Our retail portfolio continues to hold up exceptionally well, and we've even upgraded two of our major restaurant tenants during the pandemic. We collected 97% of retail contractual rents for the quarter and 96% of retail cash rents. Cumulative deferred rent associated with retail tenants has now dropped to $900,000 as of March 31, 2021. Overall, we have only deferred a small portion of rent, and we expect the cumulative future cash NOI impact to be less than $0.01 per share by year-end 2021. Now turning to our financial performance, where our first quarter operating results had a challenging comparison to prior year results when we were building significant momentum pre-pandemic. Net loss for the first quarter of 2021 was $1.1 million or $0.02 per diluted share compared to net income of $1.7 million or $0.02 per diluted share in the prior year. Core FFO of $0.34 per diluted share was $0.02 above the top end of our guidance range.

Thank you, Steve. To conclude, we are pleased with the early signs of recovery that we are seeing across our multifamily and commercial portfolios. In multifamily, improving lease rates and declining concessions, combined with stable occupancy point toward continued NOI growth over the course of the year. Leasing momentum at Trove continues to grow, and we expect Trove to be a key growth driver in 2022 and 2023. Our suburban portfolio continues to outperform, and the pricing power that we are experiencing in our suburban markets, combined with strong occupancy rates, are positive early indicators for future renovations. We are also encouraged to see much stronger recent leasing momentum in our urban multifamily assets. In commercial, renewal activity has been very strong, and tenants are becoming more comfortable making long-term renewal decisions. Year-to-date, we have achieved a significant reduction in 2021 expirations. New lease decision-making appears to be picking up as evidenced by the long-term lease with a new accredited tenant at Arlington Tower and the increase in touring and proposal activity that we are experiencing heading into the spring and summer months. These are positive trends, and we are optimistic that this momentum will continue. Now we would like to open the call to answer your questions.

Paul, I think last quarter, you talked about how the transaction side of things was relatively slow in that those multifamily properties that came to market either were highly competitive or have some sort of development or redevelopment component that could be risky. Are you seeing any signs of an increase in transactional volume? Do you think there will be any attractive properties that come to you guys at a reasonable price?

Let's begin by discussing the volume we've observed in the first quarter. After that, we can address the capital markets and what we're seeing in investor profiles. The volume for multifamily in Q1 was down, which was expected following a strong fourth quarter in 2020. Currently, there is less product available in the market. The softness we noted from the fourth quarter into the first quarter is primarily in the urban core markets, contributing to the limited product supply. I spoke with a leading broker who mentioned increased activity in suburban areas, highlighting a preference for locations with more greenery. We estimate that capital market activity is down 25% to 30% compared to the first quarter of 2020. This year, Fannie and Freddie reduced their allocations from $80 billion to $70 billion, and rates have increased from the mid-2% range last summer to the mid-3% range currently. Life companies have effectively filled the gap for lower-leveraged trophy assets. As mentioned in our previous call, debt funds are active in the 65% to 70% loan-to-value range, with mid-200s over LIBOR pricing, likely around 2.5%. Fannie and Freddie did reduce spreads recently, likely by 15 basis points, which may align with expectations from brokers that more product will be available in Q2 through Q4, encompassing both urban and suburban areas. We anticipate a rebound as recoveries advance and concessions in urban markets diminish. Value funds aiming for 10 to 11% returns are now adjusting their expectations to 9 to 9.5%, based on our discussions and underwriting for a three to five-year horizon. Looking ahead to late 2022 and early 2023, we expect to see more rent increases, particularly as supply pressures ease in 2023 to 2024. We are evaluating every deal, both urban and suburban. The availability of product has decreased for various reasons, and we haven't focused much on D.C. lately, but we are still exploring opportunities. Market conditions seem to be tightening more in suburban areas than urban ones, though we believe urban markets are on the upswing, and our portfolio activity supports this belief.

Great. That's very helpful commentary. Just switching real quick to the office side. It looks like from your presentation that you guys have now addressed the Sunrise, Raytheon, and B. Riley upcoming expirations along with the new activity you guys have at Arlington Tower, all of which is very impressive in this environment. I think that just leaves Capital One at Silverline as your biggest upcoming expiration. Can you just talk a little bit more about the ongoing discussions with them?

Sure, Blaine. We currently have Capital One through March of 2022, and we are actively marketing that space to other potential users. We've received active interest and are seeing good foot traffic in that area.

So that's a definite move-out.

We're marketing it under the assumption that they will vacate the space, and we are currently working aggressively to find a replacement tenant.

Speak of the devil. Paul, just a couple of quick questions for you. On the apartment side, with the seasonality you typically see with spring and summer-fall lease-up. Does the pandemic effect sort of have a hangover effect on expectations as it relates to sort of that seasonal push? Or is it sort of back to normal on that front?

I'll begin by addressing that and then I'll invite Grant and Steve to contribute. Regarding the ongoing effects of the pandemic, I believe it's similar to an accordion effect on the leasing season. If you examine the situation with Trove, for instance, we expected some months to be less active than they actually have been. I think the leasing season has begun earlier than anticipated, driven by significant pent-up demand, which we are starting to witness now. This aligns with the rollout of vaccines and people preparing to return to work. As a result, I believe our leasing season will not only start earlier but also extend beyond the usual Labor Day and early fall timeframe. Steve, would you like to add anything?

Yes. Chris, I want to add that our strategy after the winter months of COVID-19 was to concentrate on occupancy. We discussed this at our year-end call, aiming to increase occupancy while reducing concessions and improving effective rents. Since the end of the quarter and moving into April, early in the traditional spring leasing season, we've raised occupancy to over 95%, peaking at 95.3% overall. As for rates, which are crucial for us, looking back over the past 30 days in April, we've already seen effective rents improve by 5% on a blended basis. More importantly, new rents have increased by over 6%. We have strategically managed our portfolio by scheduling the bulk of expirations for the spring and summer leasing seasons, allowing us to benefit from this timing. Overall, the trend in rates is positive. I mentioned in the prepared remarks that after April, the leasing activity and early indications for May show improvements over April, which is encouraging. We're coming off a low point, but the momentum is strong. Currently, we are only providing guidance through the second quarter, but this quarter presents an excellent opportunity to build momentum.

Okay. And then, Paul, just on the restart of the renovation program. I guess just curious as to whether or not you're dealing with any supply chain issues as it relates to appliances, skilled labor, flooring, cabinets, anything like that at this point? Or is it too early to say? Or how are you guys managing through some of those items that have come up as issues for others?

Well, so Chris, we paused our renovation program when the pandemic hit. Now we are reactivating the process with the vendors. And obviously, we're renovating units that need renovation to be re-leased. But right now, to date, because the number has been so limited, we haven't really had any supply chain issues to speak of. I'm talking to developers that are doing ground-up spec. I'm hearing of some delays. And then obviously, we're all observing pricing spikes in lumber and other materials. But we have not personally, Chris, experienced anything yet. I would also say that we're evaluating each one of our submarkets on an individual basis. And we are anticipating doing more renovations as we progress throughout 2021.

Last question for me, Paul. As it relates to Riverside, you talked about the housing shortage, typically coming out of a recession, even one as unique as the pandemic. Construction costs tend to sort of moderate relative to the heat that was coming into that the developers were experiencing prior to the crisis. I guess I'm just curious as to how do you think about the timing of when you'll be evaluating that? And how that fits into sort of your longer-term outlook there?

Well, I mean the straight answer, Chris, is we evaluate it every quarter because we've got 1,200 cores there that are live ball, so to speak. And I think our renovation program there is an excellent litmus test in terms of when we would want to go in the ground. I think what we look for in the Riverside submarket is we want to see market rents stabilize and project some growth. And when we do that, I think that's when the discussions will obviously become much more granular in terms of start times. We were fully entitled, and the project was shovel-ready. So I do think that we'll be able to act. But I think the first thing we're looking for, Chris, is some stabilization in that market and a positive forward outlook.

My first question is, as it relates to just thinking about apartment assets and making investments there. It seems like a lot of the discussions around going-in cap rates in the 3s. Is that something that you feel you can make sense of even if it has a decent trajectory upward? Or are you seeing things where maybe there's some slices to the market where you can go in at a better yield?

Anthony, it's Paul. I'll begin by addressing that question. We aren't seeing three cap deals. I'm participating in a lot of national discussions, and while I'm noticing that elsewhere in the country, we haven't encountered a three cap deal ourselves. The larger question is whether we will pursue underwriting in the market and whether we will challenge new products, particularly the value-add products we prefer. The answer is yes; we underwrite to remain competitive. However, I want to emphasize that our focus is on long-term value creation for our shareholders. Through our research, we've pinpointed the submarkets we want to target and understand their growth metrics. I've observed others completing deals in the past 12 months, underestimating the impact of rent caps or evictions and assuming those risks won't affect them. We have conducted thorough research and know the markets we wish to enter. I believe WashREIT has demonstrated that it can compete effectively when it comes to pursuing transactions that we see as significant opportunities for value creation for our shareholders.

Got it. And then on the other side, with some of the leasing that you've done in office. Does that tee up anything for sale that we should expect over the course of the year?

We're always looking, Anthony, at opportunities right now to create value for our shareholders. And so we will continue to monitor opportunities as they present themselves.

Okay. And then just last one for me for Steve. I think like in your second quarter guidance, how should we think about things like garage income and that stuff that's been depressed because of the pandemic, what's in there versus, say, normal? Just trying to understand what the trajectory back might look like.

Yes, we haven't provided extensive details, but we did share an expectation for net operating income in the second quarter. This includes some improvement in transient parking income, although we didn’t specify that separately. We're observing a return of people to work, especially as vaccinations become more widespread. We mentioned that the district has relaxed restrictions, allowing street parking, but that is now being reversed, leading people to use garages more. We're also being more flexible and creative in our offerings, catering to transient parkers with various programs, including short-term parking, not just monthly options. This buildup is reflected in our NOI expectations for the second quarter.

Okay. But still, it's likely we are not fully back yet, I would assume?

Yes. We're not making a definitive prediction about when everyone will fully return, but we believe that it may begin to happen in 2021. However, we do not expect parking to reach pre-pandemic levels in the second quarter. We hope to see gradual improvement as the year progresses.

Great. Just to follow up on that last question. With parking activity rebounding or expected to rebound, are rates the same as they were pre-COVID, or has there been any change on that front?

We've done a little bit of discounting because we've got a lot of capacity. One of the things, Danny, that we talked about in our parking is D.C. is a little bit different than the other gateway cities in that it's low-rise and not high-rise. And people will not universally, at the same pace, need to take public transit to get to work. You can drive more because we can park up to 50% of the building populations in our buildings, and we have about 50% capacity. So to help with income, we've done some discounting and some creative things to pick up more parking revenue.

Is that more of a moment in time type reaction? Or do you think there's likely some impairments going forward, even kind of post-vaccination and post-COVID?

Well, you're asking me to guess what the inflection is going to look like post-COVID, but we haven't given a lot of guidance. But if you ask me to guess, I think more people will drive that used to take public transit. And I think that will start to drive the demand; we'll be pretty competitive. And when we get to that point, I'm assuming we'll have pretty good pricing power.

Danny, I would estimate that since before the pandemic until now, there has been approximately a 5% to 10% decrease in net effective rents in D.C., based on the first quarter data. In Northern Virginia, I would suggest it has been slightly negative, but the data indicates that it has remained largely flat. According to the JLL data I reviewed yesterday, Northern Virginia is certainly performing better.

Then I guess on that last question. Do you think that you'll see kind of a filtering through of rising construction costs and concessions? Or do you think that will be mostly muted?

I believe it really depends on the specific market in question. In downtown D.C., particularly for larger tenants with bigger space requirements, securing leases is the main focus. Landlords are likely to take necessary steps to achieve this. Although we are observing an increase in tenant improvement costs, I think landlords will do what is needed to lease these larger spaces. Thank you again, everybody. I'd like to thank everyone for your time today, and we look forward to seeing many of you over the next several months. Thank you.

Thank you. This does conclude today's conference. You may disconnect your lines at this time, and thank you for your participation.