Copper Property CTL Pass Through Trust (CPPTL) Q3 FY2025 Earnings Call Transcript & Summary

Good morning, ladies and gentlemen, and welcome to the Copper Property CTL Pass Through Trust Conference Call. [Operator Instructions] Please note that today's conference is being recorded with an online replay available 1 hour after the conclusion of this call. Additional information can be found on the Investors section of the company's website at ctltrust.net. After our speaker remarks, there will be a question-and-answer period. [Operator Instructions] I will now turn the conference call over to Trust's Investor Relations representative, Jessica Cummins.

Thank you, operator. Good morning, everyone. Welcome to the Copper Property CTL Pass Through Trust Conference Call. Over the past few days, the Trust filed with the SEC an 8-K containing its October 2025 monthly reporting package and its quarterly report on Form 10-Q for the period ended September 30, 2025, each of which are available online at ctltrust.net. On the call today, Neil Aaronson, the Trust's Principal Executive Officer; and Larry Finger, its Principal Financial Officer, will discuss these filings as well as the pending sale of our remaining assets. In addition, a representative from GLAS, our trustee, will be available to answer questions. Please note that during this conference call, some of the comments will be forward-looking statements. All statements other than statements of historical fact are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements may be identified by the use of forward-looking terminology such as anticipate, believe, continue, could, estimate, expect, intend, may, might, our vision, plan, potential, preliminary, predict, should, will or would or the negative thereof or other variations thereof or comparable terminology and include, but are not limited to, the Trust's expectations or beliefs concerning future events and stock price performance. The Trust has based these forward-looking statements on its current expectations, assumptions, estimates and projections. While the Trust believes these expectations, assumptions, estimates and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond its control. These factors, including those discussed in the Trust's registration statement on Form 10 filed with the Securities and Exchange Commission may cause its actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements. For a further list and description of such risks and uncertainties, please refer to the Trust's filings with the SEC that are available at www.sec.gov and on our website. As such, it is important to note that management's comments today include time-sensitive information that may only be accurate as of today's date, Thursday, November 13, 2025. [Operator Instructions] I will now turn the call over to our Principal Executive Officer, Neil Aaronson.

Thank you, Jessica. Welcome, everybody, to our quarterly call. As we announced last Friday, pursuant to the final extension option available, Onyx has increased its deposit and the closing date under our PSA has been extended to December 8, 2025. Based on the status of all matters required for closing, we remain very confident that the closing will occur by December 8. During the third quarter, we sold 2 retail properties to adjoining property owners pursuant to their right of first refusal rights for $12 million. This sale resulted in a corresponding $12 million reduction of the portfolio purchase price under the PSA to $935 million. Since the Trust's formation, we sold the 6 distribution centers and 43 retail properties for a total of $1.105 billion and a net gain on sale of $147 million. With that, I'll turn the call over to Larry Finger.

Thanks, Neil, and welcome, everyone. Including the distribution that we made on Monday, today, we distributed $1.5 billion that represents sales distributions of $1.1 billion and rental income distributions of $400 million. The Trust agreement doesn't permit distributions other than in conjunction with the prior month's results. So assuming a December 8 closing, the sales proceeds will be distributed with the December monthly operating results in January. Let me walk you through the liquidation proceeds now. The sales price, as you know, is $935 million. We anticipate approximately $18 million of costs at closing, getting you to a net of $917 million. In December, assuming December 8 closing, we will not have a full monthly rent. We will only have a partial monthly rent. And net of expenses, we anticipate about $1 million of additional money to distribute. At that time, in January, we also anticipate distributing $10 million of the $15 million managers reserve, getting us to a total amount to be distributed estimated at $928 million on January 9. We anticipate distributing the $5 million remaining managers reserve in February, net of operating expenses. Trust agreement requires that we maintain the $10 million trustee reserve for 12 months following the sale of the last property. We're looking into whether an amendment to this 12-month period would be appropriate. However, assuming no amendment, we would anticipate that this reserve will be distributed in January 2027, net of 2026 operating expenses. In that regard, please note that assuming the portfolio sale closes this year, beginning of February, Hilco plans on voluntarily reducing its management fee below the minimum provided for in the documents, but we haven't yet finalized that number. With that, we'll open the call to questions.

[Operator Instructions] There are no questions at this time. I'd like to hand the floor back over to management for any closing comments.

Thank you, moderator. Once again, we appreciate your interest in Copper Property Trust and for joining the call, and we look forward to the next time we update you, hopefully post close.

This concludes today's conference. You may disconnect your lines at this time. Thank you again for your participation.