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Greetings, ladies and gentlemen, and welcome to the Vesta First Quarter 2026 Earnings Conference Call. [Operator Instructions] And as a reminder, this call is being recorded. It is now my pleasure to introduce your host, Fernanda Bettinger, Vesta's Investor Relations Officer. Please go ahead.

Good morning, everyone, and welcome to our review of the first quarter 2026 earnings results. Presenting today with me is Lorenzo Dominique Berho, Chief Executive Officer; and Juan Sottil, our Chief Financial Officer.

The earnings release detailing our first quarter 2026 results was released yesterday after market close and is available on the IR website, along with our supplemental package.

It's important to note that on today's call, management remarks and answers to your questions may contain forward-looking statements. Forward-looking statements address matters that are subject to risks and uncertainties that may cause actual results to differ. For more information on these risk factors, please review our public filings. Vesta assumes no obligation to update any forward-looking statements in the future. Additionally, note that all figures were prepared in accordance with IFRS, which differ in certain significant respect from U.S. GAAP. All information should be read in conjunction with and its qualifying in its entirety by reference to our financial statements, including the notes thereto and are stated in U.S. dollars unless otherwise noted.

I'll now turn the call over to Lorenzo Berho.

Thank you for joining us today. and for your continued interest in Vesta. The first quarter marked a strong start to the year with solid leasing momentum and stable portfolio performance despite ongoing global tensions. Importantly, as our results demonstrate, we're seeing not only continued activity, but growing conviction from our tenants. This was reflected in new leasing and expansions with existing clients as well as with exciting new clients during the quarter.

Our performance reinforces the strength of Vesta's platform and reaffirms our approach for 2026. And of our Route 2030 strategy, which is centered on expanding a well-curated high-quality portfolio for disciplined development, leveraging our privileged land bank to capture demand. We believe value creation in our space is driven more by quality than size. While we are seeing increased competition for stabilized assets, Vesta differentiation lies in our ability to develop and operate a selective portfolio aligned with global best practices and the evolving needs of our clients.

Let me briefly highlight the key drivers of Vesta's results. As I noted, leasing activity remains strong with total first quarter leasing reaching approximately 1.6 million square feet, including 1 million square feet in new leases with best-in-class companies. Total portfolio occupancy reached 89.7% by $0.05, while stabilized and same-store occupancy reached 93.4% and 95%, respectively. Reflecting the strength and stability of our tenant relationships. During the quarter, we saw strength in the electronics and aerospace sectors and also in AI-related data center infrastructure which is becoming an increasingly relevant demand driver that will benefit from long-term structural tailwinds.

On the development side, our pipeline continues to convert into active construction with Vesta projects breaking ground across key markets. This is further evidence of both improving demand visibility and the strength of our land bank which is expected to support the stabilization and gradual recovery of occupancy. Along these lines, as leasing activity continues to gain momentum, we have selectively resumed development.

We launched 2 new projects in Mexico City and 1 in Tijuana during the first quarter, which brings our total development pipeline to approximately 1.6 million square feet. Importantly, our approach remains disciplined and demand-driven, prioritizing tenant back projects in high conviction markets.

From a financial perspective, results remain solid. Total rental income increased to $76.7 million, while rental revenues reached $74 million, a 14.1% sequential increase. Also with sustained strength across our key profitability metrics, including NOI and EBITDA.

Let me now turn to the broader market environment and how we are seeing it reflected across our portfolio. Recent data has focused on rising vacancy in certain regions, particularly in the North. However, what we are seeing is better characterized as a correction, not a structural slowdown or a decline in underlying demand. Markets such as Tijuana, reflect more uneven dynamics but it's important to note that this is largely due to supply from less experienced developers. Vesta's high-quality infrastructure-ready buildings continue to outperform, reinforcing our focus on portfolio quality. We're leveraging our strength in this market and launched a new project in Tijuana during the first quarter.

New construction starts in key markets such as Monterrey have declined significantly year-over-year, reflecting a market that is adjusting quickly. In Mexico City, fundamentals remain strong. According to CBRE, Mexico City gross absorption reached approximately 6.7 million square feet during the quarter with pre-leasing accounting for most of the activity and more than half of new supply delivered already preleased. This dynamic reinforces both demand debt and forward visibility across this market. It has also led us to launch the 2 new projects in Mexico City, which I have described. In Guadalajara, we are seeing healthy demand, particularly from electronics and technology-related tenants, a key driver of activity in the market. During the quarter, we successfully pre-leased the 2 Vesta buildings under construction, underscoring the strength of underlying fundamentals and the sustained momentum we are seeing in the region.

Let me now turn to how we are executing against this environment. Our strategy remains consistent. Vesta will grow through a high-quality well-graded portfolio developed with discipline and aligned with the long-term demand. As I have commented, our focus is on portfolio quality, not scale, ensuring that each asset meets the highest standards of infrastructure, energy and operational performance. This is particularly relevant in the current environment. Despite the competition for stabilized assets we are seeing, we believe there is greater opportunity in selective development where we can create value and differentiate through product quality and tenant alignment.

Before I conclude, let me briefly touch on our capital position and outlook. As Juan will discuss, we continue to operate with a strong and flexible balance sheet, maintaining a disciplined approach to leverage and liquidity, which enables us to execute our strategy while navigating uncertainty. Capital allocation remains selective with a focus on high-quality projects supporting efficient growth.

In closing, we are highly confident in our outlook. While near-term uncertainty persists, the underlying structural drivers underpinning our business are stronger than ever. Tenant activity continues to be robust. Foreign direct investment is maintaining strong momentum and manufacturing experts at record levels.

At the same time, higher-value industries such as electronics, aerospace, semiconductors and data infrastructure are accelerating demand for Vesta's premium properties. We also expect a more favorable interest rate environment together with greater clarity around USMCA to support activity in the quarters ahead.

Let me now turn the call over to Juan to review our financial results in more detail.

Thank you, Lorenzo. Good day, everyone. Let me start with a brief overview of our first quarter results. On the top line, we delivered a solid start of the year, with total revenues increasing 14.4% to $76.7 million, primarily driven by rental income from new leases and inflationary adjustments across our portfolios. In terms of currency mix, 88.9% of first quarter 2026 rental revenues were U.S. dollar denominated compared to 89.7% in the same period last year.

Turning to profitability. Adjusted net operating income increased 13.4% to $70.47 million. Our adjusted NOI margin decreased 62 basis points year-on-year to 95.1%, reflecting higher operating property costs relative to rental revenues in the quarter.

Adjusted EBITDA totaled $62.1 million, up 12.4% year-over-year, while margin contracted by 130 basis points to 83.9% primarily driven by higher operating and administrative expenses during the quarter.

Vesta FFO, excluding current tax, was $43.1 million compared to $45.1 million in the first quarter 2025. The decrease was primarily due to higher interest expense in the first quarter of 2026 compared to the same period in 2025. We closed the quarter with pretax income of $97.9 million compared to $28.6 million in 2025. This increase was primarily due to higher gains in the revaluation of investment properties, higher interest income and higher other income. This was partially offset by higher interest expense, reflecting an increase in the debt balance during the period, along with the increased foreign exchange losses and other expenses.

Turning to our balance sheet. We ended the quarter with $206 million in cash and cash equivalents and total debt of $1.2 billion. Net-debt to EBITDA stood at 4.1x, and our loan-to-value ratio was 26%, down from the 28.1% at the year's end, reflecting the prepayment of the remaining $118 million MetLife III facilities. As of the end of the first quarter, we have no secured debt with 100% of our debt denominated in U.S. dollars and 87.2% of our interest rate exposure on a fixed rate basis.

Finally, consistent with our balanced capital allocation strategy, on April 22, 2026, Vesta's shareholders approved a $74.8 million dividend for 2026 representing a 7.5% increase year-over-year. On May 6, we will pay a first quarter cash dividend.

This concludes our first quarter 2026 review. Operator, could you please open the floor for questions.

[Operator Instructions] Our first question will come from the line of Piero Trotta with Citibank.

I have 2 questions. The first one is spec development in Tijuana. So given that the start, could you elaborate to us on the key conditions that supported the decision to move forward with this project in a market where vacancies remain high. More specifically, what metrics or market signals are you monitoring most closely when allocating capital in Tijuana? Just to understand as we see like in the market of Tijuana around 16% vacancy and even in your Vesta's portfolio is around 13%. What are you looking at when you're starting a new project in the region?

And the second one is about leasing spreads that remained positive at around 9%. And I would like to understand how should we think about the sustainability of spreads from here as supply-demand dynamics continue to evolve across our markets, just to understand on this one.

[Foreign Language] Thank you very much for your question and for being on the call. Well, definitely, this is a good quarter to start the year. And I would like to highlight that, as mentioned before, Vesta will -- with very -- little by little start development in certain markets, certain projects, we did good land acquisitions last year. And that's why we start again with projects in Mexico City as well as Tijuana with the ones that we started before in Guadalajara and Queretaro. So the Tijuana project, it's actually -- it's a continuation of our existing project mega region. We -- as you remember, we did a land acquisition on adjacent land to develop the second phase. We did the land improvements last year and today, we're happy to be able to now start the first building of the second phase. It will take us pretty much the rest of the year to conclude the building to be developed. And the reason of developing it is because we believe we have a good pipeline from either existing clients or potential clients that want to be established in a state-of-the-art industrial park in a good location where you can have good access to labor, good access logistically and very importantly, good access to energy. And that's what we already have in our park in Tijuana. And I understand that there's other vacant spaces in the Tijuana market. However, we know that none of them are so well located as this one and that's a key advantage. There has been some new vacant buildings in other submarkets of Tijuana. In many places, actually that lack energy, they lack logistic accessibility and they also lack labor. That's why they will probably remain for a longer period of time available until they find the right client. There's many, I would say, unexperienced industrial real estate developers. So that's why we feel comfortable with the type of buildings that we develop. And we think that eventually, this will turn into a successful project in a market that we know quite well.

Secondly, on your question on spreads. Well, I think that the spreads will continue to be in a 10% to 13% range somehow. This one was -- this quarter was slightly lower just because of the -- maybe the combination of computation of previous quarters. But in the end, I think going forward, and we have stated this before, we think that over time, we will continue to see double-digit growth in terms of spreads. We have had some interesting re-leasing spreads throughout the quarter of projects in the 20% to 50% range, which is quite attractive. And I think that together with some of the new leases that have been signed also in some cases with rent, 30%, 40%, 50%, depending on the market. So this trend will continue. We see very strong rent levels in most of the markets. And in some markets, very strong rent growth still. So we are confident that, that will continue to be the same situation going forward. And we -- that's -- that continues to be a main driver of value for our existing portfolio with our existing clients and tenants. And we think that going forward, we will continue to see this positive trend.

Our next question will come from the line of Gordon Lee with BTG Pactual.

Just a quick question, it's sort of more a general sector question. But as you mentioned, there is a potential for a pretty significant consolidation in the sector, which obviously that's not something that you look at, your business plan is different. But I was wondering, generally, Lorenzo, how you feel about consolidation in the sector, particularly this type of consolidation, would you generally say that's good for better sort of competitive dynamics for a bit more disciplined on the ground? And specifically, do you think that might have also a positive effect in terms of discipline around development?

Thank you, Gordon, for your question. It's quite interesting the market dynamics and what we have been seeing from a capital market perspective. I believe that this is a -- in some ways, this is a broader strategy from some global players that are active in Mexico that actually maybe their strength is on capital markets more than being on the local ground and having access to tenants as well as access to development and higher returns. And that's why I think that's a particular strategy for some of them.

I think this is an industry that has -- that is very intense in capital. And I think that looking -- seeing that there's a lot of capital chasing for transaction, chasing portfolios even sometimes regardless of the type of assets they hold because sometimes they don't even match the original consolidator assets. But in the end, I think it's more the appetite of having industrial assets and being larger consolidators. I think that we will continue to see that going forward as long as there's strong capital chasing for attractive assets. I think that will continue to be the case. Also, I think it's relevant to consider that it sets a price -- sets pricing to transactions. So even for some assets that I believe are maybe below the quality of the Vesta standards having those prices, I think it's -- it sends a good signal on the opportunity that we see in our own assets that remember that Vesta, we selectively define which markets we invest on. We're very mindful of the quality of assets we develop. We also strategically define the type of tenants. So over the long term, we think that, that makes our assets be way more valuable and I think that, for that reason, these consolidations create an attractive baseline of reference so that we can have some sort of comparables to our own valuations.

And do you think -- if I could just have a quick follow-up, do you think it has any implications, positive or negative on competitive dynamics or development discipline for the sector as a whole? Or no, I mean, do you think your day-to-day would be unchanged regardless of what happens?

I mean frankly, most of these consolidators do not have development capabilities. So I think it doesn't -- I think it's only worth for certain merchant developers. But in the end, I think that we will continue to have our own discipline in terms of development. I think that maybe -- I think this will keep some of the acquirers more distracted in their own acquisition strategy, and I don't see them very active on the development.

Our next question will come from the line of David Soto with Scotiabank.

Just a quick one and It is related to the micro grid. It would be great if you could tell us in which regions are you currently developing this kind of facility? And what are the challenges that you are facing to develop this kind of facilities within the -- your industrial part?

Do you mind repeating the question, David? Thank you.

Yes, of course. It's related to your micro grid. It would be great if you could tell us in which regions are you currently developing these kind of facilities and which are the main challenges that you are facing?

Thank you for which type of assets you mentioned?

For the [indiscernible] that you are currently developing. If you are having these kind of development or micro grids development?

Okay. So maybe if I understand correctly, the question is on which markets we might be developing well. Currently, we started a few projects in Mexico City, the land acquisition that we did last year. This is in the [ quality plan ] corridor, a very attractive market that has shown growth particularly coming from logistics as well as e-commerce and rental, and we continue to see rental growth. That's why returns are quite attractive. And for that reason, we believe that developing spec in the area is very, very appealing.

We started a building in Tijuana. And very soon, we will start also development in Guadalajara, as you could see in our report, we were able to lease the 2 projects that we have under construction and we're happy to continue to see growth and demand coming in the electronics sector, particularly, but also this market has shown also strong dynamics in the logistics and e-commerce sector. So hopefully, soon, we're going to start some spec buildings similar to what we have done in the past in the rest of Park Guadalajara. So we're confident that with the land acquisitions we did last year, we're going to have a -- we're going to repeat the success that we have previously in the rest of Park Guadalajara I.

Also, we acquired land recently in Monterrey, in La Palma, in Juarez. And these 2 markets are the ones that eventually, we will also start developing spec buildings or build-to-suit projects. We have started with a -- we have had good progress in the permitting licensing and little by little as long as we start seeing a strong momentum on the leasing, we will start buildings and will be a strong signal that the markets are permitting again to have some projects. And this is mainly driven by the pipeline that we have been generating. We have definitely seen stronger demand from different sectors particularly the ones related to electronics, the ones related to AI, to data center infrastructure as well as e-commerce, logistics and medical devices to name a few. So that's pretty much in most of the markets. We see that clients as well as potential new clients are -- have regained confidence in their expansions. Many of these clients have had record high numbers in terms of production and uncertainty is coming back again for them to continue expanding and continue opening up new operations in Mexico.

Our next question will come from the line of Anton Mortenkotter with GBM.

Congrats on the results. I have 2 quick questions. One is, I mean, you already mentioned a little bit of the dynamic that you saw that made you start the development. But I was wondering if there is any like specific sign that the market gave you in order for you to decide to move now and reactivate sort of strong Vesta development. That is one.

And the other one is with all of these new newly announced developments, it's getting close to the cash balance that you already have. So how are you thinking about funding capacity from here? I mean, specifically, do you see any need or opportunity in the new term to tap either the debt or equity markets?

Thank you, Anton, for your question. I think we -- definitely, we have internal metrics that we monitor in order to identify where we should be starting a project. And maybe just to use a positive example is the projects in Guadalajara that we started construction end of last year, we started without having a lease signed, but we identified that there was demand coming from certain sectors and that's why our decision was to anticipate to those clients by starting construction soon. So that in the meantime, while we are under development, we could be able to close with the potential demand that we saw.

And this quarter, that's exactly what happened. We closed again, we pre-leased with 2 current existing clients of Vesta that continue to grow and require flexible space, the standards that we have developed in the past. Those particular metrics are the ones that we follow every time we start a building. Again, Mexico City, good dynamics. We have had some good success with the e-commerce clients. We will -- we think that there will continue to be demand for that. So we feel comfortable with that start for a project that will be eventually developed at some point end of the year. And again, Tijuana is a similar situation. Even that we have a few buildings available right now, which we are in a marketing stage, they're both in different regions, different submarkets in Tijuana, different dynamics, and that's why starting a new building in this region makes sense because of some potential demand that we are already identifying. So I think that this strategy has paid out well in other markets. We continue to see -- to have a few buildings that we are in the marketing stage. But we are confident that this will continue to be a good year and good absorption. And we think that we will continue to see good absorption. So this is actually the third quarter in a row that we see strong demand and good absorption. So I think that compared to, let's say, the start of last year, which was -- the uncertainty was incredibly high and projects were pretty much on all of them on hold. I think that dynamism has changed effectively end of last year and with a strong start of the year of clients looking for high-quality buildings with a great -- good reputation landlords where they can establish their new long-term operations and make their own investments in different sectors.

As for the balance sheet, well, look, we have a very strong balance sheet. And we will always be flexible and keep our options open. We have $200 million in cash. We have a low leverage. So we will tap the market whenever possible, and we can sell properties, we can do equity. We will always be flexible and we'll see as we continue to grow, what is the best market to tap. And remember, all of this was mentioned on the 2030 plan and we have a long-term vision, and we will always take decisions that balance out the alternatives and balance out the capital requirements of the company. We're very flexible.

Our next question comes from the line of Adrian Huerta with JPMorgan.

I have 2 questions. One is if there is any opportunities for asset recycling? Are you looking for potential asset sales? And the second one is how the yield on cost is today given movements on construction and land cost relative to what you can charge on rents?

Thank you for your question. On the second question, I think that yield on cost continue to be very attractive in the 10% range, even in some cases, even higher than that. I think that one of the largest benefits to that has been our ability to acquire land at a lower cost basis, I think that we were very opportunistic last year and strategic so that we were able to acquire land at $0.70 to $1, and that's how, together with our ability to get competitive construction costs, that's -- and with a still attractive market rents. That's how we can be able to close a double-digit yield on costs in the -- we're doing deals in Mexico City at 9.8% yield on cost, close to 10%. And in markets -- in other markets, even at 10.5%, 11%, such as Queretaro, Tijuana, for example. So I think that our experience as a developer and managing well the construction process and construction competitive process. I think that that's giving us an edge so that we can make high returns. And more importantly, Adrian, it's not the ability to make 10% return on costs, but it's the spread on the investment that we can make since we believe that if properties in the larger portfolio environment we're seeing that are transacting at 7.5% to 7% to 8% range. We think that assets similar class to Vesta could be trading closer to a 6%. So developing at a 10% and stabilizing at around 6%. That's a lot of spread and this is exactly the value proposition that we have for our shareholders.

Look as far as capital recycling -- building recycling, we will always be open to do that. I think that we have been successful in selling parts of our portfolio at a higher than net -- asset valuation value, and we will continue to look at those opportunities. And we do selectively -- we -- it's different to some of the FIBRA that they need to dump a lot of the assets they have recently acquired because they don't match their strategy. We don't need to do that. We sell selectively every now and then we want to only make a scope to our portfolio. But frankly, we invest -- develop to hold and we invest long term and every now and then opportunistically we sell.

Our next question will come from the line...

Just to add on that. I think our discipline is a good example. We like to sell above net asset value. Above valuations where we believe we can actually make -- create a premium and make a good profit. And I think a good example has been in the past where we have sold 10%, 20% above abrupt -- appraised value in the private markets. And then we have been able to develop again at 10%. I think that's the approach. In terms of capital allocation, I think that's a discipline that we will continue to see going forward. And I think that's a main differentiator on Vesta. Sorry for the interruption.

Our next question will come from the line of Rodolfo Ramos with Bradesco BBI.

I only have 1 left, and it's a follow-up on Gordon's on the consolidation angle here. Just to get a sense of the impact that you could see, if any, particularly in the northern markets, let's say, Tijuana, Juarez, if this further consolidation takes place, whether you think that this has any impact on the -- your commercial efforts or on the lease spreads that you're able to get through, I mean -- and maybe perhaps on the positive side, whether a more consolidated market might just lead to better discipline on that front.

Thank you. Well, I think that industrial real estate is -- in Mexico, it's a very fragmented sector. There's really no dominance from any player in any of the markets. I think that -- actually many of these consolidations, if you look carefully, most of the acquisitions are done in secondary and tertiary markets. Markets where actually we do not operate and are quite small. I mean, in the end, I mean, some of them there's an overlap, but the majority is in secondary and tertiary markets. So I don't think this could have a major impact when it comes to marketing certain regions as the ones that you mentioned. I don't know exactly what might happen with the -- those secondary and tertiary markets because in many of them, we're not that active.

Our next question will come from the line of Carlos Peyrelongue with Bank of America.

Total occupancy remained stable at 90% in the quarter. Your expectation for this year is for this level to be maintained or do you expect some increase. And in that case, which markets do you think would drive that potential increase in occupancy?

Look, well, we generally don't project occupancy forward-looking. It's not a guidance item. However, we're very optimistic of the market dynamics, as Lorenzo mentioned, I think that we will have good absorption in the quarters to come.

And in terms of market...

And the market -- the market, mostly to be specific, we currently -- we have -- we're in a marketing stage in Monterrey in our Apodaca project, and that's gaining strong momentum. So we feel confident that we're going to see some good absorption in the next months -- in the next quarters, and that will have a very positive impact in occupancy. As you mentioned, it has stabilized, and I think there's an opportunity to see an upward trend. We will continue to see demand. So that Monterrey will recover soon also in some markets in the Bajio, which have shown resilience particularly in Queretaro. And actually, in some of the cases, we have good quality buildings where sometimes we rather wait until we have a good tenant. We think that our projects as well as our parks are in good locations with good energy infrastructure, with good quality buildings, again, good access to labor. So we think that eventually that will impact positive absorption and with that have a positive impact on occupancy.

[Operator Instructions] Our next question comes from the line of Igor Machado with Goldman Sachs.

First one, a follow-up on construction costs. So could you please comment if given the ongoing conflict in the Middle East, are there any -- are you seeing imports are already increasing in price? And do you have any [indiscernible] to understand how could this impact your cost?

And the second question is on the material equity in San Luis Potosi. So could you comment on what drove this and is this enough? And if you could please comment on how are you seeing the demand on the value region [indiscernible].

Excellent. Thank you for your question. Regarding marketing of San Luis Potosi. San Luis Potosi a smaller market for Vesta. However, we have a project which is next to the BMW plant of San Luis Potosi, this market has a strong dependence on the auto industry. And I think that last year was quite slow. But we start to see us -- as we start seeing a little bit of some adjustments in the production lines of them as well as other auto manufacturers. We think that there will be better demand throughout this year and with that, create a bit more absorption. We have a good quality project, again, right next to BMW. We already have good tenants, but definitely, it's a slower market. Should not have a major impact in the overall strategy for Vesta.

And on your construction cost, well, definitely, that's something that we are monitoring carefully, how the -- what are the implications on the conflict of the Middle East on the construction cost. However, we have not seen any material adjustments -- I'm sorry, not materially -- larger adjustments so that could have a negative impact on construction. I think that what is -- nevertheless, I think that what is important to monitor is not only construction costs, but also FX because we calculate everything on a dollar per square foot basis. But even with that, I think that Vesta has been able to absorb well some fluctuations. And I think our -- and we will continue -- and also some of the projects that we have already started construction that we do on guaranteed maximum price. So even if there's fluctuations in the pricing throughout the construction process, that is not impacted to our final cost because we have already guaranteed the price. That's kind of the natural process to it.

And there are no further questions. I'd now like to turn the call back over to Mr. Berho for his concluding remarks. Please go ahead, sir.

[Foreign Language]. In closing, we continue to deliver on the important milestones of our Vesta 2030 strategy anchored in portfolio quality, disciplined execution and long-term value creation. Market dynamics are strong, particularly for high-quality infrastructure ready buildings, where demand continues to show resilience. This reinforces our confidence in the near-term outlook and our ability to capture incremental opportunities as activity continues to build. Against this backdrop, we remain committed to executing with discipline and expanding a well-curated platform to capture long-term demand. Along these lines, we look forward sharing important updates. Also on progress related to our Route 2030 strategy at our 2026 Vesta Day to be held in New York on November 11. As always, thank you for your continued support. Goodbye.

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

Greetings, ladies and gentlemen. Welcome to the Vesta Fourth Quarter 2025 Earnings Conference Call. [Operator Instructions] As a reminder, this call is being recorded.

It is now my pleasure to introduce your host, Fernanda Bettinger, Investor Relations Officer. Please go ahead.

Good morning, everyone, and welcome to our review of the fourth quarter 2025 earnings results. Presenting today with me is Lorenzo Dominique Berho, Chief Executive Officer; and Juan Sottil, our Chief Financial Officer.

The earnings release detailing our fourth quarter 2025 results was released yesterday after market closed and is available on Vesta's IR website, along with our supplemental package. It's important to note that on today's call, management remarks and answers to your questions may contain forward-looking statements. Forward-looking statements address matters that are subject to risks and uncertainties that may cause actual results to differ. For more information on these risk factors, please review our public filings.

Vesta assumes no obligation to update any forward-looking statements in the future. Additionally, note that all figures were prepared in accordance with IFRS, which differs in certain significant respects from U.S. GAAP. All information should be read in conjunction with and is qualified in its entirety by reference to our financial statements, including the notes thereto and are stated in U.S. dollars, unless otherwise noted.

I'll now turn the call over to Lorenzo Berho.

Good morning, everyone, and thank you for joining us. 2025 was a year of disciplined execution and strategic positioning for Vesta. We strengthened our platform advance, Route 2030 on schedule and made decisive decisions, which enabled Vesta to capture what we believe will be a powerful demand cycle beginning in 2026 and accelerating into 2027.

Early in the year, uncertainty slowed decision-making, but we stayed focused on operational discipline. During the year, our conviction to opportunistically deepen Vesta's presence in Mexico's most dynamic markets, specifically Mexico City, Guadalajara and Monterrey has proven decisive. The strategic steps we implemented throughout 2025 have materially strengthened Vesta's portfolio and positioned us to outperform.

Throughout this transition, our focus did not change. We remain disciplined in capital allocation, selective in development and stay close to our clients while adapting with agility to capture unique opportunities as market conditions evolve. This defines Vesta, long-term strategic clarity with the operational flexibility required to perform across cycles. We're not building for 1 quarter. We're building for the long term. And in 2025, we set our sights on the next cycle with improved visibility by the end of 2025.

We're seeing momentum return, particularly in the second half when leasing activity accelerated. We saw roughly 1.4 million square feet in new leasing during the second half of the year compared to 0.5 million square feet during the first semester. This reinforces our view that the market has likely reached a turning point. Vesta also delivered solid financial results for the full year 2025, which Juan will touch upon in more detail. We exceeded guidance with rental revenues increasing 11.8% to reach $274 million, while adjusted full year 2025 NOI margin reached 94.8% and adjusted EBITDA margin reached 84.4%.

Vesta FFO totaled $174.9 million in 2025, a 9.2% year-on-year increase. Let me share an overview of leasing and portfolio fundamentals in 2025. As I noted, leasing activity strengthened substantially in the second half of the year. Full year leasing activity reached 6.9 million square feet with a weighted average lease term of 7 years, which includes 1.9 million square feet in new leases and $5.0 million in lease renewals, representing the highest level of renewals recorded over the last 3 years.

During 2025, renewals and re-leasing activity reached 5.4 million square feet with a trailing 12-month weighted average leasing spread of 10.8%. Importantly, manufacturing returned with conviction in 2025. 86% of Vesta's new leases were manufacturing-related with electronics leading this activity. I have commented previously that Mexico has overtaken China as the largest exporter of electrical and electronic equipment to the United States. And we are seeing that reflected directly in our leasing pipeline. This represents a notable shift from prior years when e-commerce was the dominant driver.

Today, we're benefiting from dual engines of demand, the resilient logistics and e-commerce space, combined with a powerful resurgence in advanced manufacturing. AI-driven infrastructure is becoming an important structural demand driver for Vesta. Data center expansions in the U.S. has translated into real manufacturing demand for related peripheral equipment. This includes producers of HVAC systems, racking, tabling and microchip-related assembly.

Guadalajara continues to benefit from these structural trends with sustained demand from global manufacturing tenants. Existing clients, including Foxconn, are actively expanding their footprint, reinforcing the market strategic importance within our portfolio. From a development standpoint, we invested approximately $330 million in projects during the year on a cash flow basis. These investments are directly aligned with our Route 2030 strategy and our focus on high conviction markets where we see sustained absorption.

Turning to our fourth quarter results. Leasing activity reached 1.9 million square feet, including 770,000 square feet of new leases with both existing and new Vesta tenants across the electronics, aerospace and automotive sectors, reflecting the improving market dynamics I discussed. Lease renewals totaled 1.2 million square feet with a weighted average lease term of approximately 5 years. Total portfolio occupancy stood at 89.7% at quarter end, while stabilized and same-store occupancy reached 93.6% and 95%, respectively.

We began construction on 2 new buildings during the quarter, one inventory building in Guadalajara and one build-to-suit in Queretaro. We ended the quarter with 800,000 square feet under construction with an estimated investment of approximately $60 million and an expected yield on cost of 9.9%.

Let me walk you through leasing momentum and share insight on market dynamics across our regions. Occupancy moderated in certain submarkets due to normal tenant rotation and isolated shutdowns during the year. This is not a structural shift. It's part of the normal rotation of tenants in a dynamic market. Vacancy levels remain healthy, and we're already seeing strong backfill activity, including assets with multiple bidders.

The Monterrey market continues to stand out with leasing momentum building in this high demand market, and we expect a continued increase during 2026. Vesta Park Apodaca, which was completed in the third quarter of this year, is now in active marketing. Three state-of-the-art buildings are drawing strong interest, particularly from advanced manufacturing and logistics tenants. And as a related update, the Vesta Park Apodaca Building 8 was awarded first place in the GRI Global Awards 2025 Industrial & Logistics Project of the Year category.

The award is considered one of the global real estate industry's highest distinctions, recognizing the most visionary projects and companies worldwide for excellence in design, sustainability, innovation and contribution to the urban environment. Also in Monterrey, infrastructure is scheduled to begin in the first half of 2026 on the 330 acres we acquired in the high-demand Airport Highway corridor as announced in October.

Ciudad Juarez reached what we described last quarter as an inflection point. Activity has strengthened, interest from electronics and supply chain integration tenants is robust. This market experienced the cyclical adjustments throughout 2025 that I described, but the fundamentals remain intact. Tijuana has stabilized, and we are seeing constructive tenant dialogue, including notable leasing activity with global companies during the fourth quarter. It's important to mention we continue seeing rents increasing across our markets, supported by disciplined supply.

Guadalajara remains a structural leader for Vesta, and we are seeing a growing number of high-tech electronics companies seeking large-scale projects. Many are leveraging the strong ecosystem that has developed in the region, including specialized talent, established supply chains and existing industry clusters. This continued momentum reinforces Guadalajara's position as the leading technology and advanced manufacturing hub in Mexico, often referred to as the Silicon Valley of Mexico.

Guadalajara also benefits from the manufacturing support data centers and AI demand, which I have described. Mexico City continues to benefit from its scale, consumption base and logistics importance. We're actively engaged in discussions with major players, particularly in the logistics sector. Our project in the Vesta Park Punta Norte ramp up to become the largest cross-docking operation in Latin America of all e-commerce players in the region.

Turning to capital allocation. In 2025, we secured strategic land positions at attractive terms during periods of market uncertainty in 2025. These acquisitions will support the next 4 years of Route 2030 execution. We are 2 years into our 6-year Route 2030 plan and are ahead of schedule in terms of capital deployment. That said, Vesta's growth will continue to be prudent and measured. As always, our development pace in 2026 will be calibrated carefully to demand and absorption levels in each market.

We're clearly optimistic, but we remain disciplined. Protecting long-term returns is not negotiable. Our balance sheet remains strong, liquidity is solid and leverage metrics are trending as expected. In closing, 2025 marked a transition year. While the environment required patience early on, the broader macro backdrop is increasingly constructive as we look toward a renewed acceleration in demand.

Mexico's fundamentals remain compelling. According to preliminary data from INEGI, exports grew 7.6% year-over-year to approximately $664.8 billion, marking a second consecutive year in which trade served as a key engine of economic growth. Meanwhile, imports also reached record levels, rising 4.4% to over $664 billion. These figures underscore the scale, depth and resilience of Mexico's integration within North American supply chains.

Despite uncertainty, this integration into North American trade flows supports sustained export momentum into the U.S., validating Mexico's role as a strategic manufacturing and logistics hub. Top-tier global companies continue to view Mexico as a critical platform for serving North American demand. Foreign direct investment and exports reached record levels in 2025, while cumulative foreign direct investment inflows through the third quarter running 10.9% above full year 2024, reinforcing the structural drivers of growth that underpin Mexico in general and Vesta's market in particular.

Setting our Route 2030 strategy in 2024 and executing with precision in 2025 has been fundamental to positioning Vesta for 2026 and beyond. We're beginning to see the benefits of those decisions translate into stronger fundamentals, and we are confident that this momentum will continue to drive growth, underpinned by structural tailwinds, reinforcing our confidence in the long-term opportunity ahead.

Our optimism is grounded in discipline. Even in the context of high occupancy and solid demand, we remain rigorous in how we allocate capital and underwrite new developments. We are closely monitoring supply pipelines and vacancy trends in each of our core markets, ensuring that growth remains balanced and value accretive.

With that, let me pass the conversation to Juan.

Thank you, Lorenzo. Good day, everyone. Vesta closed the year with very solid financial results, as Lorenzo noted. Our total rental income increased to $283.2 million, while rental revenues reached $273.6 million, an 11.8% year-on-year increase and exceeding the upper end of our full year revenue guidance of 10% to 11%. Adjusted NOI margin exceeded our revised guidance of 94.5%, reaching 94.8%, while adjusted EBITDA margin was in line with our guidance at 84.4%. Vesta's FFO ended 2025 at $174.9 million, a 9.2% increase compared to $160.1 million in 2024.

Now let me walk you through our fourth quarter results. Starting with our top line, total revenues were up 17.2% year-over-year, reaching $76.4 million, primarily driven by rental income from new leases and inflationary adjustments across our rental portfolio. As for our current mix, 89.9% of our fourth quarter 2025 rental revenues were denominated in U.S. dollars, up from 88.7% in the fourth quarter 2024.

Turning to profitability. Adjusted net operating income increased 17.2% to $69.4 million. Our adjusted NOI margin remained strong at 94.6%, up 88 basis points from the prior year, reflecting higher revenue growth with stable cost. Adjusted EBITDA totaled $61.1 million, an 18.2% increase year-over-year with a margin expansion of 155 basis points to 83.3%, driven by a lower proportion of administrative expenses relative to revenue during the fourth quarter 2025.

Vesta FFO excluding current tax was $39.3 million compared to $41.1 million in the fourth quarter 2024. The decrease was primarily due to higher interest expense in the fourth quarter of 2025 compared to the same period of 2024. We closed the quarter with pretax income of $98.5 million compared to $81.2 million in 2024. This increase was primarily due to higher gains on revaluation of investment properties as well as a positive variance in exchange gains and higher interest income. This was partially offset by higher interest expense, reflecting the increase in debt balance during the period.

Turning to our capital structure and balance sheet. We ended the year with $337 million in cash and cash equivalents and total debt of $1.28 billion. Net debt-to-EBITDA was 4.4x, and our loan-to-value ratio was 28.1%. Subsequent to quarter's end on February, we prepaid the remaining Metlife III facility of $118 million. This repayment leaves us with no secured debt, enhancing our financial flexibility and completing our transition to a fully unsecured capital structure.

In terms of capital allocation, during 2025, we strengthened our land reserves, positioning us well to capture future development opportunity, as Lauren discussed. Looking ahead, we will maintain our disciplined investment approach, deploying capital selectively in markets where we see strong demand fundamentals. Our share repurchase program also remains a key pillar of our capital allocation strategy. We will continue to execute opportunistically as we have done successfully in the past with the objective of maximizing long-term shareholder value. Moreover, consistent with our balanced capital allocation approach on January 15, 2026, we paid a cash dividend for the fourth quarter of $0.38 per ordinary share.

Finally, I would like to discuss the outlook for the year. We are expecting to increase rental revenues between 10% to 11% year-on-year, while we expect to achieve 93.5% adjusted NOI margin and 83% adjusted EBITDA margin for the full year 2026.

This concludes our fourth quarter 2025 review. Operator, could you please open the floor for questions.

[Operator Instructions] Your first question comes from the line of Juan Ponce of Bradesco BBI.

It was interesting to see that 86% of 2025 leases were manufacturing related, which seems to be imperative. So in a scenario where the USMCA review does not reach an agreement in 2026 and transitions into annual reviews, how resilient is your current development pipeline under that environment? And specifically, how confident are you in leasing ongoing projects in Guadalajara and Queretaro if trade visibility becomes more limited?

Juan, thank you very much for being on today's call. Well, we have experienced uncertainty regarding trade for the last years. And that has been not only seen in industries like -- in markets -- in industry like ours, but also other corporates, in other industries and even in other regions of the world are facing similar challenges, whereas the manufacturing footprint -- the global manufacturing footprint is adjusting and adapting.

We believe that Mexico has invested for many years, maybe since NAFTA to establish a more integrated supply chain in North America together with U.S., Canada. But in the end, I think that, that will continue thriving on top of whatever negotiations might take place regarding revisions of the USMCA, different scenarios. I think it's more about the strong supplier base that Mexico has actually very -- for different manufacturing industries and how important and how well linked it is to the U.S.

Guadalajara is an excellent example of how the electronics sector has evolved, has been growing rapidly, and it's actually a good signal how the global manufacturing footprint for electronics is moving. And I think for that reason, we are very optimistic. That's why we started new buildings. We have a strong pipeline building up in Guadalajara. And eventually, actually, we have acquired more land for future projects.

So we're very optimistic. We think these are long-term investments. Many of these global companies continue to have strong bets on Mexico. And for that reason, we see a positive trend. Very similar to Queretaro where actually we have seen, in this case, the auto sector very active in renewals and also very active in looking for new space, pipeline building up. Aerospace sector, a similar case where many European companies have established long-term operations.

We just expanded another operation with the Safran Group out of France. And this is another important case and good signal how committed global companies are to Mexico. Maybe just on the lease-up stage, we're confident that there's a stronger pipeline. We have available space that has been currently -- recently developed in Monterrey, for example, where we have -- where we developed the last buildings of the Apodaca project and pipeline is building up well in different industries, logistics, e-commerce, manufacturing. So I'm pretty sure that 2026 is going to be a very successful year and leasing will continue the same trend that we have seen, particularly in the last half of 2025.

Next question comes from the line of Andre Mazini.

Two questions. The first one on leasing in recently completed development projects. How much was executed in the quarter and in the year? And how much is baked into 2026? So another way of asking, what's the occupancy of the stuff to deliver in 2025 you expect in 2026? Maybe that's another way of asking that.

And the second one is about the huge land bank acquisition in Monterrey. Almost no land there last quarter. Now it's the biggest single region, right, in which you guys have land. Is that land all paid in cash? Is it paid in cash and land swaps as well in which the landowners end up having a portion of the project? So how is kind of the payment, the consideration there for this huge land bank acquisition that you guys had in Monterrey? And congrats for that acquisition.

[Foreign Language] Andre, and thank you very much for being on the call. I will start with your second question. Yes, last quarter, we were able to buy after a long negotiation, a strategic land parcel. This is in Apodaca corridor right next to the airport. The initial phase is 330 acres. So this matches perfectly to our long-term strategy in what we -- in the largest industrial market in Mexico where we will continue to grow. We will have -- the most part of the capital deployment towards 2030 will be Monterrey, and this is going to be a cornerstone project for the 2030 Route.

The Apodaca corridor has been fantastic for companies in the e-commerce sector. It's a great logistic corridor, but also manufacturing continues to expand in the area. The area has good access to the main corridors towards the U.S., good access to the city. It actually has a good infrastructure in terms of energy, which is very helpful. And maybe just -- the only thing we can say about the transaction is that the payment was not done all at once.

We got seller financing, which is helpful for a development project and for the whole -- for the development process. And eventually, we also have conditions to extend the land for a second phase. So we're very excited, and we will be more than happy to welcome you soon when we kick off the construction of this new site.

Regarding your first question on leasing, well, current -- remember that our main focus is stabilized portfolio occupancy, which currently stands at 93.8%, I believe, a little bit lower than 95%. Definitely, the occupancy number is a little bit lower than before. We were coming from record high numbers. But what we feel confident is that most of our buildings are actually brand new, and we have seen that demand interest coming from outstanding companies.

So we're very happy that the buildings are there and the demand is coming along. So I'm pretty sure that Queretaro and Monterrey will be very successful projects, and we're confident that this will lease up well throughout 2026. Remember that another important thing is that we grow with existing clients. So we're in close contact with them in order to be able to grow with them.

So hopefully, we can continue expanding our relationships. But more importantly is that we will continue with the discipline of having outstanding companies. strong credit rating companies, long-term leases, well balanced between e-commerce, logistics, manufacturing sectors. So that discipline will prevail. And hopefully, we can start getting some good results soon. Thank you, Andre.

Question comes from the line of Jorel Guilloty of Goldman Sachs.

I have 2. So first one on your guidance. I just wanted to get a sense of what the occupancy expectations are embedded in this guidance. And also if it envisions any more development launches going forward? And then the second question, I'm sorry if you answered this earlier, I wanted to get a sense of the income tax expense for the quarter. It was around $36 million or so if I remember correctly. I wanted to understand what drove this and what we should expect tax-wise going forward?

Sure. Let me answer the second one briefly. It is related to the appreciation of the peso. As you know, that generates some significant profit from our debt, which is incurred in dollars, and that accounts for most of the income tax impact that we saw on the income statement. As the peso stabilizes, starting with a very low peso-dollar exchange rate closed at the end of the year, I think that will be eliminated in 2026. As for the first question?

Sure. We don't give any guidance on occupancy numbers, Jorel. However, if you see the trend on the occupancy towards the last quarter's years and having an understanding on the lease-up activity, we definitely think that even that it's a lower number, we are confident that, that number will somehow pick up throughout the year. We think it's a healthy number and understanding that we're a development company, we have a strong stabilized portfolio that generates important income.

But also we have anticipated with good buildings on a spec basis that I'm pretty sure that we will continue to lease up throughout the year and that occupancy will improve. We have been in cycles like this one, and we have outperformed and benefited from anticipating through -- on the development front. So we're confident that being proactive on the asset management part is going to help us.

Secondly, we think even that last year was started as a slower leasing activity, we have seen rents actually have increased in the year, some markets more than others. However, all of them with positive trends. So as long as we continue to see demand excelling throughout 2026, and we see that rents continue to be increasing, I think that we will benefit from that and take advantage and eventually be able to have better occupancy, better rental revenue and also have a positive impact in our -- eventually net asset value from having good tenants inside of our buildings.

And a quick follow-up on the guidance, does it envision more launches, more developments going forward? Or is it just envisioning your company as it is today?

That's a good point, Jorel, regarding development. Well, again, without the guidance, we don't give guidance specific on CapEx as well as development and other numbers. But what we can say is that we prepare -- we presented the 2030 Route in 2024, which we have been executing successfully. We -- 2025 was very important to secure land as the one I mentioned in Monterrey, but also in Mexico City, but also in Guadalajara and in other markets. So that land has to be still developed.

We think that as long as we continue to see in a disciplined way, more demand in certain markets and where we can start leasing up, we will definitely like to start construction soon. So 2025 -- 2026 will be a year where we will start construction on the land that we have acquired and follow through our 2030 Route.

And hopefully, we can be able to develop build-to-suit, spec buildings and eventually be able to replicate the success that we have had in Vesta Park projects such as the ones in Guadalajara, in Apodaca, Tijuana, Ciudad Juarez, Mexico City. So it's another cycle. We're entering a different stage. We're optimistic on 2026 and 2027. For that reason, I think that CapEx will continue to be important as well as development starts.

Your next question comes from the line of Enrique Cantu of GBM.

Congrats on the results. I just have one question on your revenue growth guidance. What are the main drivers behind that outlook? Is it primarily additional GLA from developments, rent increases or higher occupancy from leasing vacant space?

Look, the guidance -- as you know, guidance, we make the guidance very carefully. We are assuming taking into account the buildings that we leased up until December that will begin paying rent on the -- beginning in the first months of 2026 as well as the stabilization of the buildings that we have unoccupied where we have a strong pipeline, and I think there were significant tenants coming up on -- starting on the first quarter. So taking that into account, we feel confident to give you the guidance that we give you now. I think that 2026 is a promising year. I think that we have a strong pipeline. I think that we're well advanced in talking to potential clients, and we are very optimistic indeed.

Perfect.

I would add that we have also been able to renew leases and get mark-to-market rents that has been on the existing portfolio that has been -- we have been very successful. So the existing portfolio is not only the mark-to-market on renewals, but also year-over-year. Remember that our leases are indexed to inflation. So the combination of existing leases at each anniversary indexed to inflation plus mark-to-market on certain contracts, plus our ability to lease up vacant building together with new development, all combined is part of how we forecast revenue growth and therefore, guidance.

Your next question comes from line of Gordon Lee.

A question a little bit more on the operating side, Lorenzo. I was wondering, if you look at some of the northern markets, right, thinking of Tijuana, Ciudad Juarez, Monterrey, it's -- I've been surprised, I think it's been remarkable how stable rents have been even as vacancy numbers have increased for the market as a whole. I was wondering what do you attribute that to? And do you see any risk of that changing for the worse in the quarters to come?

Can you repeat the question, please just -- I think you broke up a bit.

Okay. No, I was just -- my question was, if you look at some -- if you look at Monterrey, Ciudad Juarez, what I think has been really interesting is market rents have stayed pretty stable even with rising vacancies. So I was wondering what do you attribute that to and whether you see a risk to that going forward?

That's -- okay. I got it. Thank you, Gordon. That's a good question. So we believe that what we experienced last year was a little bit somehow unexpected where we saw a slowdown at the beginning of the year. And you might remember January, U.S. President taking office, liberation date and the high uncertainty that we experienced made a lot of companies not making any decisions and not making any -- not leasing any space. Normally, in an environment where you have a slower demand, normally, you could see a reduction in rents.

However, in this case, there was the market was just stout. So there was not even a need to reduce rents by any of our competitors. So for that reason, what we think is that demand started coming up back, and it was not a matter of supply and demand. It was just a matter that there were no leases at the beginning. And suddenly, when they came back, we think that vacancy is actually not that high. And that's why we continue to see that replacement costs of several buildings continue to be high and returns have to be expected. Developers have been disciplined and the vacancy and occupancy and vacancies among most of the markets are at healthy numbers, even that they are somehow higher than before, but we were at record low levels -- but if you look at a longer period of time, we are still in a good numbers.

Going forward, I think that we will start to see more demand. We think that rents -- I don't see a major risk regarding rents, frankly. I think that rents will hold up well or maybe even increase. But in the end, I think that over the long term, we think that rents are still competitive. Companies are in Mexico for its competitive advantage, particularly on manufacturing. And in terms of logistics, these are cities that continue growing. Consumer habits are still changing and more consumers are adapting to e-commerce to logistics, more demand. So we're very optimistic and positive on most of the markets. So we don't see any potential risks on rents.

Your next question comes from the line of Pablo Ricalde of Itau.

I have a question on the development pipeline. So we finally see you like coming back into the build-to-suit projects with the Safran building. So maybe going forward, how should we think about the development pipeline of mix between build-to-suit and spec-to-suit building?

Great. Thank you, Pablo. So we will continue to see build-to-suits and spec buildings well balanced. We -- I think that what is more important is that now that we believe we are hitting a pivotal moment where we will continue to see more demand. We will continue our strategy on spec buildings. It has paid off well to have spec buildings and then turn them into somehow build-to-suit, we call them spec-to-suit because we're able to pre-lease the buildings and in the meantime, make final adjustments for the tenants. But importantly is that we are able to kick off or to start the buildings in advance and anticipate to potential demand.

However, we currently have some buildings in the market. So we have -- we want to have discipline. So as long as we continue to see demand and leasing coming up, I'm pretty sure that we will start with some other spec buildings. And build-to-suits, we are constantly looking for them. We recently closed an expansion with Safran. That's a good example. So I think that being close to our clients, close in the markets with the real estate community and broker community, I think that we're going to be able to continue to do both, particularly because the land acquisitions that we recently did is so well located that I'm sure that there's going to be many companies that would like to establish their operations in high-quality parks with great infrastructure with access to energy.

And I think that will be a huge benefit for companies going forward. This year will be very important to focus on the development execution, particularly to get all the infrastructure and organization of the land that we acquired in place and try to get ready so that when demand and projects continue to kick in, we have a -- we're already a step forward and take advantage of those opportunities. And I think that's what makes Vesta different.

We are an institutional portfolio manager, asset manager of industrial assets, but also we like to take advantage and capture the growth opportunities on the development front where we can continue to see returns at 10% or even higher return on cost and that vis-a-vis acquisition cap rates in the 6% range are -- we think that there's a lot of spread that we can capture on the development front on new buildings. And I think that's a huge benefit for companies wanting to establish operations in Mexico.

Our next question comes from Pablo Monsivais of Barclays.

Just a question on Aguascalientes. There's been some news that Nissan is planning to sell the COMPAS plant in Aguascalientes. And since you have big operations there and a considerable land bank, what's your take in this? And that divestment could impact a little bit the dynamics in that region or probably not if the taker is a company that is growing? Just want to pick your brain on that news flow.

Thank you, Pablo, for being on the call, and thank you for your question. Yes, there's a lot of speculation on what might happen with that particular COMPASS plant. I think that whatever happens, it's going to be very positive for the sector, particularly because it's a -- that plant, it's, I would say, brand new or state-of-the-art. It was developed together between Mercedes-Benz and Nissan. So it has a combination on German technology and Japanese innovation. So I think it was a fantastic project, which for whatever reason, didn't work out.

However, I think that, that's why it has a lot of interest from different players. So again, without getting too much into the speculation, we think that Aguascalientes is a fantastic city where companies have been successful. And I think that understanding that Mexico continues to be an attractive manufacturing front, I think that definitely somebody will benefit from that plant. And actually, we think that eventually that will bring new suppliers from a new company and Vesta will continue to be there.

I think that for Vesta, Aguascalientes is becoming every time a less relevant market. However, we think -- we believe in long-term relationships. We have good relationships with several suppliers in the auto industry. And for that reason, we think that there could be some good upside to the new plant -- or I'm sorry, to a potential buyer of the new plant.

Okay. And if I can squeeze another question there. Just want to understand, it is my understanding that your guidance for 2026 has a slightly lower margin versus 2025. What's the reason for that?

Pablo, this is Juan Sottil. As you know, the peso-dollar exchange rate is -- well, it's a little bit punitive to the company given the fact that we sell everything in dollars and all of our expenses mostly are in pesos, basically our employee cost. So it's going to be a difficult year. It's a year where we will continue a very strong discipline on cost control. We're very successful doing that last year. And we will continue to focus on cost control and being very mindful of the operation needs in terms of people and the location of those people. So it is a challenging year in terms of operating costs, but we will keep the discipline.

Next question comes from the line of Abraham Fuentes of Santander.

So I wonder if -- are you considering any asset recycling during 2026? And the second 1 will be what could we expect in terms of dividends also for this year.

This is Juan Sottil again. Thank you for the question. Look, asset recycle is something that we will continue to do. It is an opportunity that we will garner in our portfolio. We'll keep on the lookout. We scope our portfolio. We believe that we are in the best regions in Mexico. We believe that we have very successful buildings. But we also believe that recycling older buildings or buildings that have accrued a good stabilization status they represent an opportunity to sell them.

There's other players that like to buy those type of stabilized assets, and we will take advantage of that. So we will be on the lookout to sell buildings. That's an integral part of our development plan, of our growth plan, and we will be on the lookout. Regarding dividends, dividend is a part of our compensation to shareholders. We believe in total relative -- in total return.

Total return implies our effort to grow the company so that the market recognizes that in terms of appreciation of the stock price. And dividends are just an integral part of that total return. We will continue to pay dividends. We will continue to grow judiciously the dividend flow for the incoming year. You will see our dividend policy as soon as we have our shareholder meeting in the next month or so. So that's very much. I think you should consider.

If I may add, I think it's consistency on what we have done in the past, and that consistency will continue to be there going forward for dividends as well as for asset recycling.

Your next question comes from the line of David Soto of Scotiabank.

Just 2 quick ones. The first is related to your vacant buildings. Could you provide more detail about the marketing efforts and the current status of ongoing negotiations of those buildings? And what kind of tenants are interested on such assets? And the second question is related to your leasing spreads. During 2025, you reported double-digit leasing spreads. Is it reasonable to assume that this could be maintained during 2026 and which regions could have this double-digit leasing spreads?

Thank you, David, for your question. Maybe on the second one, I think that definitely, we will continue to see the upward trend on the leasing spreads, particularly because this is a bit of a -- it will continue to be an opportunity in the upcoming years as some of the leases continue to hit their maturities, and that's when we have the ability to catch up. So that's something that has happened last year, will continue this year and maybe even the upcoming years as long as some of these long-term leases that were done some years ago hit their maturity stages. And we think that, that's a great opportunity to -- and we've been very, very active on that front.

And then on your second question -- on your first question regarding vacant buildings, well, we are very confident that the pipeline is building up. We are very happy with the projects that we have developed. Just as mentioned before, just to give you an example, we have been getting awards on the Vesta Park Apodaca project, particularly in one building, Building 8, we got awarded the GRI Global Award of Industrial & Logistics Project of the Year. And I think that competing with other countries, with other developers across the globe, this is a very, very nice recognition and award.

And so we do our best to develop the best projects. And I think that eventually will turn out into having a higher benefit with companies that want to be in the best projects in the most dynamic markets. The buildings that we develop on top of the certain specifications on design, sustainability, innovation, these are very flexible buildings. So we can accommodate e-commerce clients as well as logistics as well as light manufacturing. So I think that strategy on spec buildings will be very helpful where we can be competitive in terms of cost in markets where we can have good access to labor, where we can have good infrastructure. So we -- for that reason, we are confident that the vacant buildings we have today are great buildings that will be leased up eventually.

Question comes from the line of Felipe Barragan.

So it's been a year -- a little over a year now that Claudia is in office. She announced an infrastructure program a few weeks ago. So I just want to get your sense if there's -- I mean comparing two years ago to where we're at today, what strides have you guys seen that are tangible on sort of getting permitting, electricity and whatnot for developments?

Great. Thank you for your question. We -- frankly, I think that there has been a lot of very proactiveness towards our industry and our business coming from the Claudia Sheinbaum administration. As you know, Claudia Sheinbaum has been the only President or the first President to include industrial parks as part of a long-term infrastructure plan. She has considered 100 projects to be developed. Well, many of those are actually Vesta's projects.

And we have been having great access to some of their economic development councils as well as corresponding secretaries to have the best permitting and licensing and support in order to make these projects work. I think that she has a very good understanding on the opportunity that Mexico has to develop together with the private sector, good industrial infrastructure that creates better jobs, better paid jobs, which is very important for her as for the welfare and in terms of support for the people.

So in the end, I think that there's a strong alignment, there's good support. And I think that for them having companies that are institutional and well organized like Vesta is also a good recognition to our sector. Through the Mexican Association of Industrial Parks which I happen to be at the Board, and I was previously a President, we have also a very close contact and very good access to the government agencies so that the presidency is successful, the country is successful and we developers contribute a lot to that success.

Your next question comes from the line of [indiscernible] of GBM.

Congratulations on your results. I just have one question. How are you thinking about the pace of developments in 2026, given the current occupancy levels and broader market uncertainty?

Thank you for your question, Pablo. Well, I think that Vesta will continue monitoring the markets and defining where we can start projects. I think a good example for that is Guadalajara, where we recently started 2 spec buildings end of last year. The reason of that being that we have leased up our existing buildings. We see -- we continue to see strong demand, and we want to anticipate to that particular demand. So we have -- in order to how do we -- the way we monitor it is through the real estate community, the broker community as well as our existing clients.

So I think that, that same example will be used for the rest of the market. We think that there are some good success stories in Juarez, in Tijuana, where we were able to lease up the second half of last year. That's going to be helpful in order to eventually start new buildings. And the same for Monterrey. Well, Monterrey, we did that large acquisition on the Apodaca on the new land next to the airport in the Apodaca corridor.

So we will kick start with the infrastructure. And eventually, when we see leasing -- some closings on the leasing front on the current project, we will pick up with new projects. So we are definitely going to be more active than 2025, but we would like to continue being cautious and disciplined and in line to whatever we see a potential demand and not being oversupplying the market. And actually, as you know, development front and development cycles are long.

I think that being able to acquire land last year and this year focus on infrastructure and some new buildings will put us in a great spot for 2027 to start generating income on those projects. And eventually, our main focus will continue to be the 2030 Route. So we're optimistic. We see the market positively, and we think we have the capabilities to pick up some good development projects throughout the year.

Your next question comes from the line of Federico [indiscernible].

Congrats for the results. Two questions in particular. For [indiscernible] in capital allocation, you used the buyback last year. I assume that you will cancel that this year and extend the maturity of the debt, et cetera. But thinking in the long-term strategic book of 2030, what do you find in terms of acquisition of land development, et cetera, et cetera, not on consolidated basis, is thinking more in regional basis. That are the 2 questions. Sorry, and the last one, Juan, what is the Mexican peso that are using for the budget and the guidance for this year?

Well, look, the Mexican peso is surprisingly strong. So we made our forecast at MXN 17.50, but we have been -- that has been proving a little bit too short. Again, the theme of the year in terms of the administration is cost control. And we will be keen on continuing to do that as the peso is very strong compared to the previous years. Now in terms of capital allocation, look, I think that we have acquired about 90% of the land that the plan requires. So I don't think that this year, we will -- I mean, there's always opportunistic acquisitions. Mexico is one an important market where we will continue to look for important land.

But the bulk of the land we have, this is a year of, as Lorenzo has said, infrastructure investments. These great plots of land need to be made shovel-ready, and we are prepared to do that. We have to be ready for the upcoming demand, which we can see on our pipeline. So capital allocation will be mostly focused on making the land shovel-ready, opportunistic investments in land in places like Mexico City. And as I said before, if there's opportunities to sell part of the portfolio, we will. So that's just keeping Vesta running as a smooth company and taking every opportunity to provide good results that the market will recognize.

Congrats again for the results.

Thank you.

There are no further questions. I'd now like to turn the call back over to Mr. Berho for his concluding remarks. Please go ahead, sir.

Thank you, everyone, for joining us today. As we look ahead, we are confident in the opportunity and equally confident in our ability to execute with prudence across cycles. If the next strong economic phase accelerates into 2027, as we believe it will, Vesta is uniquely positioned to capture that growth responsibly and at scale as supply has moderated and pipeline conversations point to improving visibility over the next 12 to 24 months. Thank you all, and have a nice day.

Thank you for attending today's call. You may now disconnect. Goodbye.

Greetings, ladies and gentlemen. Welcome to the Vesta Third Quarter 2025 Earnings Conference Call. [Operator Instructions] And as a reminder, this call is being recorded. It is now my pleasure to introduce your host, Fernanda Bettinger, Vesta's Investor Relations Officer. Please go ahead.

Good morning, everyone, and welcome to our review of third quarter 2025 earnings results. Presenting today with me is Lorenzo Dominique Berho, Chief Executive Officer; and Juan Sottil, our Chief Financial Officer. The earnings release detailing our third quarter 2025 results was released yesterday after market closed and is available on Vesta's IR website, along with our supplemental package.

It's important to note that on today's call, management remarks and answers to your questions may contain forward-looking statements. Forward-looking statements address matters that are subject to risks and uncertainties that may cause actual results to differ. For more information on these risk factors, please review our public filings. Vesta assumes no obligation to update any forward-looking statements in the future.

Additionally, note that all figures were prepared in accordance with IFRS, which differs in certain significant respects from U.S. GAAP. All information should be read in conjunction with and is qualified in its entirety by reference to our financial statements. Including the notes thereto and are stated in U.S. dollars unless otherwise noted.

I'll now turn the call over to Lorenzo Berho.

Good morning, everyone, and thank you for joining us today. While we entered the year facing macro uncertainty and slower market activity, I'm pleased to note we're now seeing encouraging signs of improvement as clients start to make decisions. Leasing momentum is returning. Tenant demand is intensifying and the fundamentals behind Mexico's industrial real estate market remain intact. We are particularly encouraged by the uptick we're seeing in leasing absorption, a signal that companies are regaining confidence and moving forward with their long-term commitments.

Third quarter was a solid quarter for Vesta. We delivered strong operational execution in a market which has begun to normalize from earlier year softness, as I have described. Vesta's rental revenues increased, supported in part by the rent-generating buildings we delivered last quarter and will continue to drive revenue growth through the end of the year. Our retention rate remains high and rents on rollovers continue to trend upward, demonstrating both the quality of our assets and the strength of our tenant relationships.

Meanwhile, our stabilized portfolio continues to perform well. Total income for the third quarter reached $72.4 million, which is a 13.7% year-over-year increase. And total income, excluding energy, reached $69.9 million, a 14.5% increase. We delivered an adjusted NOI margin and adjusted EBITDA margin of 94.4% and 85.3%, respectively, for the third quarter 2025. Let me now walk you through leasing activity and market conditions across our core regions.

Total leasing activity for third quarter 2025 reached 1.7 million square feet, 597,000 square feet in new leases with new and existing tenants and 1.1 million square feet represented renewals with an average age of 6 years and a trailing last 12 months weighted average spread of 12.4%.

Vesta's third quarter 2025 total portfolio occupancy, therefore, reached 89.7%, while stabilized and same-store occupancy reached 94.3% and 94.8%, respectively. As expected, our overall portfolio occupancy dipped slightly during the third quarter, primarily due to the delivery of new buildings currently in the lease-up phase as a result of the robust development pipeline we executed throughout the year.

We're confident that absorption will follow, and this positions us exceptionally well to capture the demand we anticipate later this year and into 2026, given improving demand indicators, which I'll touch upon today. Let me share some color on what we're seeing across our markets. In Monterrey, we completed construction of our Apodaca park with 3 new state-of-the-art facilities now in the marketing phase. We're seeing strong interest, particularly from advanced manufacturing and logistics companies.

We will be highly selective in determining our future tenants given the quality of our parks and Monterrey's role as a key near-shoring destination. Apodaca stands out as Monterrey's most strategic submarket, offering direct access to major industrial corridors and proximity to the Monterrey International Airport. And after the quarter closed on October 2025, we announced that we have acquired 330 acres of land in Monterrey in the high-demand Monterrey-Apodaca Airport Highway corridor.

The site benefits from strategic location next to the Monterrey International Airport and Nuevo León’s Research and Technology Innovation Park, offering exceptional connectivity and direct access to a highly skilled labor pool. The deal included attractive 24-month seller financing, providing flexible capital deployment. And importantly, with this acquisition, Vesta's land bank is nearly complete to deliver on the Vesta Route 2030.

In Ciudad Juarez, we saw early signs of a market turnaround in the third quarter. According to CBRE, overall vacancy contracted by 130 basis points and Class A vacancy retreated by 190 basis points for this market.

This was underpinned by 1.3 million square feet of net absorption during the quarter. Vesta secured a lease with a global electronics company of 500,000 square feet during the quarter, a transaction which boosted third quarter absorption and reinforced the vacancy decline in this market. Juarez continues to draw international manufacturers, especially in electronics and high-precision goods.

We believe the third quarter marks an inflection point in Juarez's industrial recovery and Vesta is well positioned to capture the next cycle of demand. In Tijuana, we're seeing slower recovery with market dynamics still adjusting to a recent influx of supply in this market. High vacancy is a result of a wave of spec deliveries that enter the Tijuana market. That said, there are early signs of reactivation. CBRE highlights that 67% of leasing demand continues to come from manufacturing users, which reinforces Tijuana's ongoing strategic relevance in the broader nearshoring landscape.

Vesta has been actively engaging with a strong pipeline of tenants in the region, which give us confidence that dynamics are improving. Tijuana is a constrained market with limited land availability and physical barriers that make long-term overbuilding less likely. These fundamentals, combined with recovering demand should gradually support rebalancing as the year progresses. And while Tijuana's pace of recovery is lower than in markets like Juarez or Monterrey, Vesta's competitive position remains strong.

Our portfolio benefits from institutional grade quality, reliable infrastructure and access to key logistic corridors. As always, we will approach this market with discipline and a long-term view grounded in data and in a deep local understanding of our markets. We have seen sustained strength in Guadalajara and Mexico City. Both markets stand out not only for their debt in scale, but for the diverse tenant basis and consistently high retention, which is underpinning our overall portfolio.

CBRE reports that the Guadalajara industrial market maintained a healthy 2.8% vacancy rate in the third quarter. Despite new deliveries, importantly, Guadalajara, is a key recipient of foreign direct investment, particularly in advanced manufacturing sectors like electronics, automotive and aerospace. In Mexico City, industrial fundamentals have remained remarkably strong as can be expected. CBRE reports record absorption year-to-date at the highest absorption in the last 5 years, driven by pre-leasing and long-term renewals.

Vacancy remains low at just 2%, supported by steady demand from logistics and e-commerce tenants. More broadly, we're seeing that activity has stabilized in the automotive sector, and our tenants in the sector have continued to renew leases and deepen their long-term commitments. Mexico is deeply integrated into the supply chain that supports the North American automotive industry. We believe it's virtually impossible to decouple. In fact, we're seeing continued and growing integration across the region as manufacturers double down on resilient near proximity production strategies.

At the same time, we're seeing a shift in momentum toward other high-value manufacturing segments with strength in electronics, scientific equipment and industrial machinery. Mexico has now overtaken China as the largest exporter of electrical and electronic equipment to the United States. Companies are investing ahead of current demand, which reinforces the importance of being ready when they're ready through land acquisitions, as I have described, but also energy supply.

The Mexican Association of Industrial Parks recently announced that the federal government is advancing targeted initiatives to support industrial parks, particularly to meet the growing energy needs of new facilities and industries. We're confident in our ongoing collaboration with both federal authorities and energy regulators. As new energy legislation takes shape, we believe industrial parks, in particular, will stand to benefit. The proposed framework includes provisions for energy generation through public-private collaboration, which we see as a positive step toward enhancing reliability and long-term capacity for industrial users.

This enables us to serve even energy-constrained regions without compromising on service or delivery. Juan will discuss our financial strategy and related capital deployment, but let me make just a few related comments. During the third quarter, we successfully completed a senior unsecured notes offering that enhances our liquidity position, extends our maturity profile and gives us the financial flexibility to fund future growth under attractive conditions.

This also enables us to refinance upcoming maturities without disruption, supporting both stability and expansion. Vesta's capital allocation has remained conservative and focused. We currently have only one project under construction, a direct result of our cautious approach at the start of the year in response to low absorption. That discipline is now enabling us to move with confidence as we prepare for new development starts for the end of 2025 and beginning of 2026.

We are prioritizing markets where tenant demand is most visible, and we'll continue to direct capital toward land and infrastructure readiness, ensuring our growth is tied to quality, timing and market visibility. Asset recycling is a key part of our capital allocation strategy, enabling us to monetize stabilized assets and reinvest in higher growth opportunities. During the third quarter, Vesta sold an 80,604 square feet building in Ciudad Juarez for $5.5 million, an approximately 10% premium to appraised value aligned with Vesta's strategy to opportunistically recycle assets.

Considering our progress this quarter, we revised Vesta's full year 2025 guidance. Juan will discuss in more detail. In closing, our third quarter results underscore a clear and consistent message for Vesta. Resilience and solid fundamentals ensure Vesta is well positioned for what's ahead. This quarter also reaffirms our ability to execute on Route 2030, our long-term vision to build a scaled, diversified industrial platform serving the most important corridors in Mexico. With that, let me turn our conversation over to Juan to review Vesta's financial results in more detail. Juan?

Thank you, Lorenzo. Good day, everyone. Let me begin by highlighting our strong financial results for the third quarter. As a result, Vesta has revised our full 2025 guidance. We now expect our EBITDA margin to reach 84.5% by year's end, up from our prior guidance of 83.5%, underscoring our continuous focus on expense control and on delivering strong results. We expect to solidly achieve revenue growth between 10% and 11% for our full year with an adjusted NOI margin of around 94.5%. Now let me walk you through our third quarter results.

Starting with our top line, total revenues were up 13.7% year-over-year, reaching $72.4 million, primarily driven by rental income from new leases and inflationary adjustments across our rented portfolio. As per our current mix, 89.4% of third quarter rental revenues were denominated in U.S. dollars, slightly up from 89.2% in the third quarter of 2024. On the profitability front, adjusted net operating income increased 14.7% to $66.1 million. Our adjusted NOI margin remains strong at 94.4%, up 16 basis points from the prior year, reflecting higher operating leverage as revenue growth outpaced costs.

Adjusted EBITDA totaled $59.7 million, a 15% increase year-over-year with a margin expansion of 34 basis points to 85.3%, driven by a lower proportion of administrative expenses in relation to revenue during the third quarter 2025. Vesta's FFO, excluding current tax, increased 16.5% year-over-year to $47.4 million compared to $40.7 million in the third quarter 2024, while FFO increased 20.1% to $0.055. We closed the quarter with pretax income of $52.4 million compared to $62.7 million in 2024.

The decrease was primarily due to lower gains on revaluation of investment properties as well as lower interest income, reflecting a reduced cash position during the period. Turning to our capital structure. On September 30, 2025, we successfully completed a $500 million senior unsecured notes at a 5.5% interest rate due in 2033, further strengthening our balance sheet, enhancing financial flexibility and advancing our goal for a fully unsecured capital structure. The notes received a BBB-/Positive rating from both Standard & Poor's Global Ratings and Fitch Ratings.

The proceeds were used to prepay the existing debt and shortly after quarter's end, on October 9, we repaid in full our Metlife II credit facility and related incremental facility for $150 million and $26.6 million, respectively. As a result, we ended the quarter with $587 million in cash and cash equivalents and a total debt of $1.45 billion as of September 30, 2025.

Our net debt-to-EBITDA ratio increased to 4x, and our loan-to-value ratio was 31%, which temporarily reflects the outstanding balance of the facilities that were repaid shortly after quarter's end. On capital allocation, Loren has noted that we sold an 80,000 square foot building at a 10% premium to appraisal value in Ciudad Juarez during the quarter, consistent with our strategy of opportunistically recycling of assets.

At the same time, we continue to strengthen our land results, as Loren mentioned before, with the acquisition of 330 acres of land in Monterrey. Moreover, reflecting our balanced approach to capital allocation, on October 15, 2025, we paid a cash dividend for the third quarter of $0.38 per ordinary shares. This concludes our third quarter 2025 review. Operator, could you please open the floor for questions.

[Operator Instructions] Our first question comes from the line of Juan Ponce with Bradesco BBI.

It seems clear that demand signals are going in the right direction. When do you think -- when you think about your long-term development pipeline, are you comfortable accelerating Route 2030 projects in the first half of 2026? Or do you think it is prudent to move slower ahead of the USMCA review in June? I ask because although vacancies have declined a bit in some of the northern markets, Tijuana still remains elevated. So I just want to get your thoughts on how you're thinking about this growth.

Thank you, Juan, very much for your question. Definitely, we have seen positive demand signals pretty much across most of the markets. I would probably like to highlight that Mexico City and Guadalajara have remained very solid throughout the whole year with vacancy rates at record low levels and still strong demand, mainly coming from sectors such as logistics, e-commerce and electronics, but also other markets have also shown some positive signals.

Now how does that translate into our long-term plan? Well, as you know, we analyze carefully market-by-market, and that's when we analyze internally at the investment committee, where do we want to resume and start new operations and new development. As you could see this quarter, even that we have had a slower year on construction starts, we were able to start -- we did resume in Guadalajara with one building.

And over the rest of the year, 2025, we will continue to start in other markets where we have recently acquired land and when we think there's already strong demand so that we can continue developing. I wouldn't think -- I think that we should still focus on the mid- to long-term plan for the 2030 Route. And we will be analyzing carefully the progress on demand from next year.

We will analyze carefully the trends on different sectors. We definitely think that in relative terms, Mexico is still very well positioned for many global companies. But as you stated, we'll have the USMCA review next year where other countries are getting tariffs. So we will analyze carefully. And with that, I think that we will resume whenever needed.

And just as a follow-up, these positive demand signals, are they coming from existing tenants or companies that already have operations in Mexico? Or are you seeing this already from new tenants?

That's a good question. I think it's both. I think it's existing tenants, but also new tenants. And we've seen more visits from companies from all over, from North America, from Asia, from Europe. And actually -- and interestingly, it's coming from -- also from different industries, not only the traditional industries such as auto industry, but also -- which is strong and integrating supply chains, but also coming particularly from industries like electronic sector, which is growing rapidly. It's also coming in the aerospace sector, for example, and of course, logistics, which continues to be quite strong.

Your next question comes from the line of Pablo Ricalde with Itaú

Congrats on the results. I have 2 questions, maybe one for [indiscernible] the first one is on the leasing activity that have been seen in October. I don't know if you can provide an update if you have leased some of the industrial parks that were vacant in September. That's my first question. And the other one is coming on the balance sheet. I don't know if you can provide what are you thinking in terms of net debt to EBITDA by year-end given all the lands which you are acquiring.

Pablo, thank you. Juan, why don't you -- okay, let me elaborate on the first question and then you give more detail on the net debt to EBITDA for the year-end. I didn't understand quite the question from -- we're getting a little bit of back noise, Pablo, but I think it was related to leasing. We were able to lease up a few buildings, one of them for our logistics operation for the electronic sector in Ciudad Juarez.

Also, we were able to lease up in the Bajio region as well as Tijuana in food and beverage, logistics and auto industry. We think that this is -- we think that eventually, over the next quarters, we will continue to see this particular industry striving, and we're getting more absorption for -- in different -- actually in different regions. Again, we see the pipeline picking up pretty much across the board.

And I think that Vesta has good quality buildings in the right locations, brand-new buildings. And I think that's key when it comes to clients looking for space. Remember that many of our buildings already have energy, which is another key advantage. And for that reason, even that there might be also some competition, we think that Vesta is very well positioned in the right locations, brand-new buildings and the right utilities and infrastructure required to establish operations in light manufacturing and logistics. So we are very positive on the next quarter, end of the year, and we hope to see a good recovery for 2026, too.

Okay. As for the balance sheet, let me say that what you see in our leverage today is just a result of the issuance of the bond and the interim period between the issuance and the payment of the liabilities. So leverage will come down as we pay down the -- as the Metlife liabilities are reflected on our balance sheet. And then net debt to EBITDA as well as leverage will come down to what our good objectives, not that the ratios that we show right now are particularly worrisome. I mean we are exactly where we need to be. We have a strong balance sheet, and we can continue to -- I mean, we have ample borrowing capacity. So...

For end of the year, Juan, are -- is it -- are we going to be a net debt to EBITDA close to, what, 25% loan-to-value and net debt to EBITDA below 4.6 maybe?

4% -- around 4x.

Your next question comes from the line of Francisco Chávez with BBVA.

Question is regarding the improvement in guidance for EBITDA margin. How sustainable is this new margin? And what can we expect once you resume the start-up of new projects?

Well, look, we have been -- this year -- as we have pointed out beforehand, this year have -- we have focused a lot in maintaining a low-cost base and of course, the growth in our revenues have helped us a lot maintaining quite an attractive EBITDA margin. As we continue to grow the company, EBITDA will continue to be strong. And I think that EBITDA will continue to be in the 83%, 85% level as we continue to grow.

And maybe related to the development question, I think that we have the appropriate -- remember that we are a vertically integrated company with -- where we have -- management is internalized. So we have the right headcount to run the operations for the existing portfolio as well as the development part of the portfolio.

So since we are in -- developing in the same markets where we already have presence, we do not foresee any major increases in costs. Actually, the opposite. I think that going forward, we will become even more efficient and benefit from being an internally managed company and vertically integrated. And for that reason, we even think that operational margins will continue to be playing in our favor.

Your next question comes from the line of Adrian Huerta with JPMorgan.

Congrats on the results and also on the land acquisitions. Just going back to the first question on demand. What else can you share with us in terms of how quick the recovery could come, meaning tenants looking and willing to sign contracts. Is there a backlog or is there a backlog of companies that you've been talking to that they basically have said that once there's more clarity on the USMCA, they will be coming. Anything else that you can share with us on that to give us an understanding of how quick these companies could start signing new contracts?

Thank you for your question. And I think that -- I mean this has been a very -- this has been a transition year. And as you remember, early in the year, we see a major slowdown in terms of new absorption and many of the companies were pencils down, not only in Mexico, but also in the U.S., for example. There was a lot of uncertainty. And for that reason, we understand that companies were just not making any decisions.

However, the year has evolved differently, and we are definitely seeing a major backlog on companies that want to establish operations in the North American region. And for that reason, we're in constant communication with potential clients. We're actually making -- we're traveling to other regions of the world. We've had people currently in the U.S., in Canada, in Europe, even in Asia, in China and in Taiwan, been participating in conferences and trying to understand what -- how companies are analyzing their manufacturing global footprint.

However, all of the companies make decisions based on different drivers. Some of them are making them based on the technology -- the new technology revolution based on AI, and that's why we've seen electronic sector jumping so rapidly, even despite of uncertainty on tariffs. But there might be others, for example, auto industry that are just waiting to see what the final end game might be.

However, I think, that companies want to be still in the most dynamic economic region in the world, and Mexico is playing a very important role in North America. We just -- we're seeing every quarter and every year just new numbers regarding exports to the U.S., our trade balances with the U.S., particularly some countries diminishing their positioning and trade participation with the U.S. So for that reason, we are confident that -- we think that we will continue to thrive as a main partner to the U.S. And for that reason, many of the industries that we already have had since NAFTA will continue to be well positioned.

Understood, Loren. And if I may add just another quick question. So we should expect some new construction to start over the next 2 quarters. And regarding the land acquisitions, we shouldn't expect much to happen in the next 2 to 4 quarters?

Sure. Well, we are -- as we have stated before, when we need to accelerate the development, we do, but when we need to slow down, we also do. So right now, I think that we're just being very cautious on where we start. We will continue to monitor demand in each of the markets. So yes, we'll have some starts for the end of the year. And next year, we'll analyze carefully.

And the good thing is that we currently have been able to acquire land throughout the year that will position us very well for the mid- to long term. We were able to buy land throughout this year in the strategic markets, and I will repeat the land that we have recently acquired, which was in Guadalajara where we started the building next to our site. We bought a second site in Guadalajara, which will be helpful for the Route 2030 strategy. We also bought land in Ciudad Juarez, in Mexico City, in Monterrey, in San Nicolás which is -- has more attributes for last mile and e-commerce. And recently, the one in Apodaca, which is going to position us with probably the best piece of land in Monterrey. And I think that's going to be incredibly helpful for the Route 2030 strategy, and that will continue positioning Vesta as a leader developer in the market of Monterrey.

So with the land that we have already acquired that we will start doing improve -- and also in Tijuana, sorry for that. We're doing the improvements. We're doing the earthworks, putting the utilities, energy and everything so that eventually we can resume and develop whenever we see demand getting stronger. So we already have, as of today, let's say, approximately 90% of the land required to fulfill the 2030 strategy.

Your next question comes from the line of Alejandra Obregon with Morgan Stanley.

Congratulations on the numbers. My question is on the energy front. You have now the land and you were talking about the utilities. I was just wondering if you can talk about how the electricity part is playing out. The new government announced 5 packages for industrial real estate, utilities, plants. So I was wondering if you think that will help your plans going forward? And then also your investment in associates line appears to be gaining traction. So just wondering if you can talk about this energy investment and how should we be thinking of it forward -- going forward?

Alejandra, thank you very much for your question. Definitely, being able to anticipate to the energy requirements for our clients has been key. And that's why we have followed very carefully the different alternatives that we can provide for our clients in the different regions. We think that the government is in the right track -- on the right track to keep on supporting investment or foreign investment in manufacturing, and they are -- and we have been working close by with them so that together with the association of industrial parks, so that industrial parks can have the right packages, the right incentives and the right amount of energy so that we can continue attracting investments.

So we're very positive on the work that the government has done with providing these packages and the support. And I think Vesta is a key example on how things can be established in order for companies to -- in order to anticipate we start the feasibilities and the processes to engage on energy when -- as soon as we start to buy the land. So when we develop the parks and the buildings, at the same time, we are investing in the energy infrastructure so that when companies do the ramp-up of operations, there's already some energy in place.

We know it takes time, but I think that we have had great results by getting some energy, and that's why our parks have already the energy, and we are very -- we're confident that, that's going to be a huge benefit now that demand will continue to pick up. Regarding -- and regarding your question on associates and energy, that's basically some renewable energy investments that we have recently done. We just closed one in Monterrey, and I think that's going to be also key to continue focusing on solar panels, renewable energies in all of the buildings that we have had in line with our 2030 Route to comply with a certain amount of renewable energies in our portfolio.

Your next question comes from the line of Jorel Guilloty with Goldman Sachs.

I have 2 quick ones. So I don't want to belabor the point on development, but just I wanted to get a sense of what are the more quantitative indicators that you look at when you make a decision to launch a development. So I mean is it the occupancy trends you see in your own portfolio? Is it the occupancy or net absorption trends you see in the market? Is it an increase in leads that you might get from external brokers or your own internal commercial team?

So I just wanted to get a sense just like put numbers to this, like what exactly do you look at when you make a decision of going forward with a new project like what you announced with Guadalajara? And then the other question is around leasing spreads. So looking at the LTM leasing spreads, we saw that there was a slight decline. So it was 13.7% in 2Q '25. It was 12.4% in 3Q '25. So I just want to get a sense of what drove this? What -- is it lower rents in a certain market in order to drive occupancy. So I just wanted to get a sense of where these lower leasing spreads or leasing spread trends are coming from.

Thank you, Jorel, and thank you very much for being on the call. I think that Vesta has a very unique investment approach. First of all, we already have more than 43 million square feet of industrial buildings that we have developed in the last 25 years. And that, together with outstanding clients where, as mentioned before, we have -- we do not rely on external brokers for our property management, we do it internally. So we have firsthand information from our clients.

We have firsthand information from the sector. And remember that also as part of our strategy to have a local leadership and regional marketing officers in each of the markets where we operate. So that's why we have, again, firsthand information of what's going on, what are the main drivers of demand. And that's why we rely on our own data and analysis when it comes to making a decision on how to invest and when to invest.

Of course, sometimes we listen to third parties, but I think that it's more -- the secret sauce is pretty much inside of the Vesta offices as to when to start and where to start, and it has been quite successful. Guadalajara -- the example in Guadalajara, well, this is the third expansion we do to the Guadalajara Vesta Park. As a reminder, we have as clients, Amazon, we have Mercado Libre, we have O'Reilly, we have DSV Logistics, and we have Foxconn as our main clients inside of that park.

So we have a close connection with them. And by being close to them, we understand where the trends are heading. And that's why we believe that starting new buildings when you're close to great companies that tend to grow, we think that it's -- that's kind of the bread and butter of Vesta, and I think we're going to be very successful, and we will continue to follow that trend in other projects in other regions where we have recently acquired land.

And regarding your leasing spread question on the last 12 months, it's -- I think that it's not a material drop. I think that eventually going forward, it's more maybe on the -- they should be hovering. I think that the trend is actually upwards if you look at the last 4 quarters. And I think that as long as we continue to see the spreads being on an upward trend in the low teens, high double digit or double-digit numbers, I think that, that's going to be quite attractive and appealing.

The important thing is to have this as a sustainable number going forward, which is exactly we think. Vesta's current portfolio is -- has a good opportunity to catch up in terms of leasing spreads, and that's what we can see even with a 12% spread on the trailing 12 months, which is way higher than inflation. And remember that most of our leases are -- is above inflation and most -- and all of our leases are linked to inflation, which adjust annually. And in many cases, we're able to catch up. That's why if you look at today's CPI numbers close to 3%, considering a 12.4%, that's material.

A quick follow-up, if I may. So just based on the development pipeline and how you get to the decision to launch, you mentioned conversations with existing tenants. Does that imply that future launches could be for these existing tenants for them to expand? Or is it more that you get color on the demand from them and that gives you the confidence to go forward with a new development?

Well, I can only tell you that more than 60% of our growth comes from existing tenants. So we like to grow with existing tenants, particularly because they are outstanding companies. So that's why we continue to develop close to them. And if there's an opportunity to grow with them, it's fine. But if we continue to find other great companies that need to open up operations in Mexico, we will continue to do so. And I think that for that reason, we focus a lot in trying to be close with good companies and keep and support their growth and become the real estate partner in Mexico. And I think that has played out well in the past, and we think that, that will continue playing out well in the future.

Your next question comes from the line of André Mazini with Citi. And since we have no response from Mr. Mazini, we are moving on to the next question from Francisco Suarez with Scotiabank. No response again, moving on to the next question. Next question is from Anton Mortenkotter with GBM.

Congrats on the results. We've been hearing that some private developers under pressure to deploy committed capital are starting to buy stabilized assets rather than take on new spec projects given the softer demand backdrop. Are you seeing that trend as well? And would you think that this environment actually plays to your advantage, I mean, being able to preserve liquidity and deploy when demand dynamics are more favorable?

Anton, thank you very much for your questions. Well, I think that one of the greatest benefits of this industry is that there's still plenty of liquidity in the market. And that plays very well to our favor, and we are seeing players in the private markets that are willing to take acquisitions of stabilized assets. We recently made an asset sale, for example. It's not very large, but I think it signals that there's appetite also for owners to get buildings and also from -- on the institutional front.

However, I think that our focus will continue to be on the development front, particularly because at the cost that we are buying land, we are investing in infrastructure, and we invest on brand new buildings. We think that development yields that continue to be in the 10% ranges vis-a-vis building cap rates or acquisition cap rates in the 6% to 7%, there are still huge spread investment opportunities, and that's why we will continue to focus on -- in terms of capital allocation to the highest returns, the ones that create the most value.

And I think liquidity, it generates value for all of us. We have seen that not only coming from private markets. We recently saw a transaction being an IPO of FIBRA in the industrial sector being launched at -- also at compelling cap rates. And we think that, that sets the -- it sets valuation standards, and it sets a tone into what we might be expecting going forward in terms of valuation, Vesta -- so -- for Vesta, that's why we think that there has a good opportunity to reprice, particularly given the major discount we are still trading to net asset value.

So those are great references and that gives us also the opportunity in some cases that if we want to buyback stock, we have a buyback program in place. So when we have -- when we see that there's a major discount to net asset value, we will continue to be using it, as we have done in the past and create value for shareholders.

[Operator Instructions] The next question comes from the line of [indiscernible].

Congratulations on the results. I have a couple of questions. The first one is a follow-up on lease spreads. I mean we did see like a small decline quarter-on-quarter, but they're still really above 2024 levels where they were around like 7%, 8%. Do you think like going forward into the fourth quarter and next year, you will be able to sustain this double-digit increase? And the second question is on same-store portfolio occupancy. Could you give us like a little bit of color on why the occupancy in Tijuana dropped from like 97% in the second quarter to 85.6%?

Great. Thank you, [ Elena, ] for your question. Yes, and I will start maybe with the second one. The second one, we saw a slight drop in the same-store occupancy given the fact that we addition new buildings to the same store. And actually, these were buildings that are currently -- we're in the marketing stage. They're still vacant. These are 2 buildings in Tijuana mega region, which are large and one of them in -- I think, in Ciudad Juarez.

But I think that's why we saw that major -- that slight drop. However, since these are new buildings and we are in marketing stage, we are confident that, that particular decrease might not affect or it's something that will -- eventually will be able to recover. And then on your -- on your first question, well, I think that we will continue to see a sustained growth in terms of leasing spreads in the double digits, probably. I think so, particularly because we've seen that market rents have held steady in most of the markets, which is very positive. And that's why renewals have come at a major increase in -- and leasing spread in most of the markets, and we've been able to capture value from that. And that will be -- that will continue to be the trend going forward to capture leasing spreads on top of inflation. And that we're very optimistic on that.

Your next question comes from the line of Alan Macias with Bank of America.

Just can you share the cap rate of the building you sold recently? And are you seeing more demand or more offers for -- to buy buildings? And the second question is, what are you seeing in the trend in real estate taxes and insurance costs? Any indication what the government will be looking for tax increases next year?

Thank you, Alan. Let me work first on your second question. So currently, we have secured our insurance costs for the next, I think, it's a couple of years or 18 months. So we have not seen any major adjustments for the moment. Eventually, when we get back to renegotiate that, we will eventually see. And we have not seen any major adjustments in real estate taxes. Now more importantly, even that we burden part of the cost, remember that we transfer part of that cost to our tenants.

These are -- in most of the cases, we have triple net leases, and that's a cost that can be absorbed by tenants. And even with that, we believe that it's not a major cost still to their total production cost to many of our tenants. So the rent together with some of the operation costs, it's still very competitive vis-a-vis other regions. In some of the cases, rent and some of the real estate-related costs represent only 7% to 9% of total production costs or in terms of logistics, total operation cost. That's still a very competitive number.

So even that we will continue to look into reducing costs. I think that all-in-all, that could well be absorbed by tenants, and they will continue to be competitive. Secondly, to your third question regarding I'm sorry, the cap rate. Sorry, yes. Well, first, yes, we will continue to do asset sales. And this is a good example of an asset, which was a vintage asset that we acquired, I think it was more than 15 years ago. This was not developed by Vesta.

And I think -- and the cap rate to in-place rent was 6.2%. And it was a $68 per square foot as a sale and a premium to a price of almost 10% but again, I think this is a good example because we -- there are some vintage assets that eventually we would like to sell and crystallize value from asset sales, sell at a premium and focus on capital allocation and allocate that capital to higher return investments, new buildings, for example, in terms of development and through that close the cycle on investment.

The next question comes from the line of Francisco Suarez with Scotiabank.

Congrats on the great quarter. The question that I have is on Mexico City, it's -- why La Villa has taken so long to lease up? Is there any difference compared to what we saw on Punta Norte? And the second question that I have is related with the overall trend behind, for instance, concessions in the market, say, 3 months of rent or step-up considerations or any CapEx. Has anything changed when you renew leases or offer new leases to new clients to what has been the case in...

Thank you very much for being on the call. La Villa, it's an outstanding project. It's a smaller building compared to Punta Norte. Punta Norte is a major fulfillment center for e-commerce. And I think on that one, it was a very unique opportunity for a larger e-commerce player to -- and for us to have a long-term lease in U.S. dollars. And I think that that's why that one was very, very particular. La Villa, it's the last mile. It's smaller. We have been having some potential clients. However, as maybe we are -- we have waited to finalize and find the right tenant to it.

Even that it takes -- it took -- it has taken maybe a bit longer even than expected. The positive to that is that we have seen rents grow in the region. So even some downtime in terms of rents, we are going to be able to capitalize through a better rent going forward with a better client. So we're positive that -- we're optimistic about being able to lease that building up. And I think that eventually, at some point coming into next year, we are -- I'm pretty sure that that's going to be well leased.

Actually, we are -- we -- Mexico City has had very strong dynamics. And actually, we recently acquired land last quarter, second quarter. And hopefully, we can start construction again soon. And then regarding concessions, well, I think this one plays out differently market-by-market, tenant-by-tenant. Remember that we do have -- when we establish a lease, we establish a relationship with the tenant. So our focus continues to be long-term leases in U.S. dollars with investment-grade, high-grade companies that we believe can add value to the buildings.

And that's why there's always things to negotiate. There could be some concessions sometimes for -- in terms of rent. But in other cases, we get things in exchange to that. So I think that on that, we will continue to be creative but trying to collect rent as soon as possible and keep on focusing on the total return of the asset, not necessarily an immediate income. One of the things that we have stated in the past, and I think plays out even more today is that we rather have a vacant building than a lousy client just because they will be paying out rent. And I think we will maintain that discipline even if it takes a bit longer.

Yes, I love that. So no changes in your underwriting policies. Good to hear.

Your next question comes from the line of André Mazini with Citigroup.

Sorry for my connection issue. So my question is around your land strategy on a high-level basis, of course, now you have probably more than 90% of the land to reach the 2030 growth plan. So how do you think about maybe a trade-off, if there is one, a risk return trade-off. On the one hand, I think you don't want to have like a huge land bank because, of course, land does not generate cash flows, right, by definition. But on the other hand, if it's too little of a land bank, your growth plan would be jeopardized. So how do you think about that trade-off of having the exact -- the kind of the optimal land bank in order to not jeopardize cash flows, but not to jeopardize growth plans as well?

Thank you, André. And that's -- I think that's a key question to Vesta's overall strategy, and that's why for us, it's key to have a strategy going forward. And we are pretty much relying on how successful we have been in the past. Remember that when we established Level 3 strategy, we focus also on investing in certain regions and certain markets. We were able to invest over the Level 3 strategy, approximately $1.1 billion in development in Guadalajara, Monterrey, Mexico City, Tijuana, Juarez and some other markets in the Bajio. And it was very successful.

And -- but the only way -- and we were able to achieve on that period returns in excess of 10% in U.S. dollars. And that -- you can see all of that in our Investor Day presentation, and I'm actually looking at Page 22, where we were able to make returns of 10% in Mexico City, 10.1% in Monterrey, 10.5% in Guadalajara vis-a-vis relevant transactions in those markets between 6% and 6.7%, which we believe that will continue to be a huge opportunity for -- in our investment strategy going forward, where we, again, anticipate on buying land, focus on the right markets and eventually we will be able to develop a -- we identified $1.7 billion investment for the Route 2030 strategy.

And the markets where we will continue to focus is, the 3 main markets being Monterrey, Guadalajara, Mexico City, Juarez, Tijuana and Querétaro. So I think that there's really very few companies that have a strategy going forward that have the land -- the right amount of land. I agree with you, it's more an art than a science how much land we should use. But I think that today being well capitalized and being global in the market [Technical Difficulty] Monterrey, recent land acquisition, it's the right approach so that we can secure land, put infrastructure in place and be ready when demand might comeback. These are going to be very successful projects and [Technical Difficulty] so that you can see [Technical Difficulty] yourself. And again, I think that is unique in the type of [Technical Difficulty].

And it seems that we have no further questions for today. I would now like to turn the call back over to Mr. Berho for closing remarks.

Thank you, everyone, for joining us today. Vesta's focus has been on ensuring we're well positioned to capture resurging demand. We are entering the final quarter of 2025 with a strong balance sheet, high-value operating portfolio and the strategic priority to continue executing on our long-term Route 2030 growth plan ahead of what we expect to be a strong 2026. Thank you.

Ladies and gentlemen, this concludes today's conference. You may now disconnect your lines. We thank you for your participation.

Greetings, ladies and gentlemen. Welcome to the Vesta's Second Quarter 2025 Earnings Conference Call. [Operator Instructions] And as a reminder, this call is being recorded.

It is now my pleasure to introduce your host, Fernanda Bettinger, Vesta's Investor Relations Officer. Please go ahead.

Good morning, everyone, and welcome to our review of Vesta's second quarter earnings results. Presenting here with me is Lorenzo Dominique Berho, Chief Executive Officer; Juan Sottil, our Chief Financial Officer. The earnings release detailing our second quarter 2025 results was released yesterday after market close and is available on Vesta's IR website along with our supplemental package. It's important to note that on today's call, management remarks and answers to your questions may contain forward-looking statements. Forward-looking statements address matters that are subject to risks and uncertainties that may cause actual results to differ.

For more information on these risk factors, please review our public filings. This assumes no obligation to update any forward-looking statements in the future. Additionally, note that all the figures were prepared in accordance with IFRS, which differs in certain significant respect from U.S. GAAP. All information should be read in conjunction with and is qualified in its entirety by reference to our financial statements including the notes thereto and are stated in U.S. dollars unless otherwise noted.

I will now turn the call over to Lorenzo Berho.

Good morning and thank you for joining today's call. Speaking to you now at the midpoint of 2025, the macro volatility and related uncertainty that I have described in prior quarters has continued, defined by shifting trade dynamics, tariff vagueness and muted investment decisions made by global corporations. The landscape we're navigating has been one of caution with softened new leasing momentum and tentative client decisions. Despite these pressures, Vesta's operating results again delivered resilient performance for the second quarter, grounded in disciplined execution that's tied to our long-term growth strategy. The current environment enables us to focus on extracting value from our core operations, noting that Vesta's portfolio ended the quarter at 95.5% stabilized occupancy with rents indexed to inflation and the sustained growth, recurring income and long-term maturity profile of Vesta's high-quality portfolio.

Let me walk you through some highlights for the second quarter. New leasing activity continues at a slower pace for our overall industry. Nevertheless, we ended the quarter with 1.8 million square feet of total leasing activity, including 411,000 square feet in new contracts with both existing and new tenants for Vesta. While this number is below Vesta's average as tenants remain in a wait-and-see mode, particularly those in export-linked markets, it reflects a sequential increase from first quarter new leasing activity. Renewals and re-leasing activity was among the highest we have experienced in the first half of the year, which confirms the resilience of this portfolio despite current economic dynamics. In the second quarter 2025, we closed 1.4 million square feet with an average lease term of approximately 5 years.

Our strong retention rates of 84% are a testament to Vesta's close tenant relationships and our team's proactive management. Importantly, we successfully continued to increase rents with some mark-to-market rent adjustments in the range of 20% to 30% as we bring legacy rents in line with current market levels. Our tracking 12-month spread for the second quarter reached 13.7%, another very important increase in our mark-to-market portfolio strategy. This uplift reflects not only the quality of our portfolio, but also again underscores the long-standing relationships we have built with our tenants who continue to choose Vesta as a long-term partner.

To provide some additional color, during the second quarter, we completed Vesta Park Apodaca, building 6 and 7, which will enter the lease-up period, while Apodaca 8 remains under construction. We expect these premium buildings both located in Monterrey to be well positioned in this highly desirable location. Vesta's dual exposure to domestic consumption and global manufacturing is also a source of strength. We are focusing on completing existing projects and strategically expanding our land bank in line with Route 2030. Specifically, we acquired 128.4 acres in Guadalajara with a buildable area of 2.3 million square feet, strengthening our position in one of Mexico's key corridors.

We also finalized the 20.2 acre acquisition in Monterrey, which we announced last quarter, adding another 450,000 square feet of buildable capacity in this critical northern market. Our approach, therefore, remains clear. We're focused on our long-term vision, managing our assets with discipline and executing a strategy led by tenant retention, strategic positioning and intrinsic value of our existing operating portfolio, which today is at 95.5% stabilized occupancy with rents indexed to inflation. For Vesta, this year's emphasis is reinforcing the strength of our foundation so we can scale confidently when environment normalizes.

That includes accelerating energy infrastructure planning, streamlining permitting and ensuring our parks are positioned to meet the evolving tenant demand. Being ahead of the curve operationally is how we differentiate, especially in slower cycles. These principles have guided us through past cycles. And they continue to anchor our strategy as we position the company for future growth. Along these lines, as Juan will discuss shortly, we maintained discipline related to costs. achieving efficiencies in both operating and administrative expenses, which supported our margin performance and help preserve capital strength. Our financial position remains solid with strong liquidity and conservative leverage.

That gives us the optionality to move when the time is right. To reiterate, despite the volatility, we view the current slowdown in leasing as a temporary deceleration, not a structural change. Companies are exercising caution, not canceling plans. Importantly, our portfolio and operational model represents an important competitive advantage. Tenant diversification, strong market presence and the flexibility we have based on our C corp structure. Critically, being a C Corp enables us to be uniquely agile, both when returning money to shareholders and reinvesting into the business without the rigidity of external distribution mandates.

This flexibility has become a key advantage in an environment where patient strategic capital matters most. Recent deliveries of income-producing properties pre-leased buildings are expected to contribute to revenues in the second half of 2025 also with continued operating efficiencies, which would support full year margins. Vesta, therefore, expects to achieve its stated 2025 guidance and remains focused on the company's route 2030 long-term strategy while navigating on the current uncertainty. In closing, 2025 is proving to be a transitional year for the sector marked by caution and extended decision cycles.

But Vesta remains focused, grounded and forward-looking. We have navigated through multiple cycles. And what has always set Vesta apart is our ability to stay disciplined, remain close to our tenants and make smart long-term decisions even in the face of short-term uncertainty. Trade policy stabilization and continued manufacturing resilience all point to a more constructive environment for the years ahead and future negotiations will maintain Mexico in a solid position. Mexico is increasingly well positioned to benefit from industrial realignment and Vesta intends to lead in that process.

Let me turn our conversation over to Juan to review Vesta's financial results in more detail. Juan?

Thank you, Lorenzo. Good day, everyone. Let me walk you through our second quarter results, starting with our top line. Total revenues were up 6.8% year-over-year, reaching $67 million, primarily driven by rental income from new leases and inflationary adjustments across our rental portfolio. In terms of the current mix, 89.4% of our second quarter rental revenues were denominated in U.S. dollars, an increase from 88% in the second quarter of 2024. On the profitability front, adjusted net operating income increased 7.2% to $61.8 million.

Our adjusted NOI margin remained strong at 94.5%, down just 7 basis points from the prior year, reflecting a slight increase in costs related to rental income-generating properties, including real estate taxes, insurance and other property-related expenses. Adjusted EBITDA came in at $55 million, a 9% increase year-over-year, emerging expansion of 137 basis points to 84.1%, this was largely due to tighter control over administrative expenses, underscoring our continuing focus on cost discipline.

We closed the quarter with a pretax income of $54.5 million compared to $131.8 million in 2024. This decrease was mainly due to lower gains on valuation of investment properties as well as a reduced interest income due to a lower average cash position during the period. Vesta's FFO, excluding current tax increased to $43.1 million this quarter from $38.2 million in the second quarter 2024, a 12.9% increase year-over-year.

Turning to our capital structure. We ended the quarter with $65.2 million in cash and cash equivalents. Total debt increased to $900 million as of June 30, 2025, primarily reflecting the $100 million drawdown in April from the $345 million syndicated loan secured in December 2024. Our net debt to EBITDA stood at 4x and our loan-to-value ratio was 22.4%, maintaining a healthy leverage position. On capital allocation, as Lorenzo mentioned, we prioritize deploying capital towards completing ongoing development and acquiring land investors core market.

During the quarter, we acquired 128.4 acres of land in Guadalajara, and we finalized the acquisition of 20.2 acres in Monterrey. These investments reflect our long-term vision, enhancing our strategic footprint and preparing us to meet future demand, as Lorenzo has mentioned. Finally, and also subsequent to quarter's end, on July 15, 2025, we paid a cash dividend for the second quarter, equivalent to $0.38 per ordinary shares.

This concludes our second quarter 2025 review. Operator, could you please open the floor for questions.

[Operator Instructions] Your first question comes from the line of Juan Ponce with Bradesco BBI.

If you can give us a sense of how you're seeing the development pipeline progress ahead of the USMCA review which we believe could unlock some pent-up demand in the issuing markets. And if you can tie your comment with what we're seeing per CBRE regarding rising vacancy in these northern markets but stable rent levels.

Thank you very much for your questions. Yes, we have seen that even that there has been an uptick in vacancy in some markets such as Tijuana, Ciudad Juarez, Monterrey, we are positively surprised on how well rents have maintained. And actually, in some cases, rents have an increase in the high single digits in some of these markets, which means that there is still pent-up demand that we believe that as long as we start seeing more clarity on those negotiations, we will continue to have a better momentum on lease-up stage. On that regard, I think that Vesta has carefully selected the markets where we want to develop and anticipate for that pent-up demand, which will eventually get back and look for the best locations, the best assets.

And we believe that the Vesta parks are incredibly well located. We have the infrastructure. We have energy, which is very important as a key advantage. And that's when we think that markets such as Tijuana, Ciudad Juarez and even Monterrey will be a huge support of the leasing -- lease-up property portfolio of Vesta. We currently have approximately 2 million square feet on a lease-up stage in different regions, and we see a pipeline building up. We currently have been cautious on new starts on development. And as we have always said, we like to accelerate when needed, push the brakes when needed and drive carefully under short-term uncertainties, and we'll benefit on the longer term. Thank you.

Your next question comes from the line of Pablo Monsivais with Barclays.

If I'm doing my numbers correctly, perhaps by the third quarter of this year, you will have a little bit more than 1 million square feet to lease in Monterrey. However, this market has had the weakest net absorption since early 2024 compared to all main markets in Mexico. How confident are you that you can lease up these properties quickly? And how do you see Monterrey's competitive environment going forward?

First of all, regarding revenues, one of the interesting things about this year is that we have delivered several buildings in this quarter and last quarters that will start generating an important part of income in the second half of the year. We're talking about 1.8 million square feet approximately in places like Mexico City, places like Monterrey, Aguascalientes, and that's going to be a lot of income coming or starting to be generated in the second half. That's going to be very important for year all revenues for the company. And to your point on Monterrey, Monterrey actually had one of the strongest net absorptions throughout 2025. According to CBRE numbers, they had more than 4 million square feet in the first half.

This is definitely lower than other -- than previous years. But if we continue to see some positive net absorption in these markets and right now, when we are finishing new buildings, we think that we eventually are going to have some good companies taking up Vesta space, which, again, we think it's really the best parks in the region in the best locations, and we will benefit from having the best assets. Remember that Monterrey Vesta has zero vacancy, but the only ones that we have available are the ones that we have recently developed and have recently delivered or soon to be delivered. So we are very confident that Monterrey being the largest market, we having -- Vesta having the best presence will be good assets to be marketed and lease up soon.

Your next question comes from the line of Piero Trotta with Citibank.

I would like to know about the yield on cost on projects under construction. This yield on cost expanded 20 bps quarter-over-quarter to 10.8%. Can we expect this yield on cost getting higher going forward? And how do you see the construction cost scenario in Mexico? Hear from you would be great, thank you.

I'm sorry, I didn't understand the question. Which type of costs are you mentioning?

The yield on cost on projects under construction, the development. The yield on cost of the second quarter was 10.8% and I would like to know if it could get higher going forward. And just an update what you think about the construction costs in Mexico.

Okay. Sorry, I was -- now I get it clear. It's the yield on cost. So frankly, we are very -- we have very attractive yield on costs, which are above 10%. And that's a very important spread to stabilize assets. So even if sometimes depending on the project or the region, it could vary a little bit, but it's still in the double digits. And actually, in many of these markets, our objective is to get dollar leases. I think that what has been very remarkable is that recent transactions and what I mean recent is recent as this week, we have seen cap rates are still at very low levels with recent pricing of a new FIBRA pricing in the 7.5% range, FIBRA that generates mostly pesos. So if you think about it, being able to yield above 10% when stabilized assets in U.S. dollars are sub-7%, we believe that spread investment is still going to be key for developers like ours and strategic for Vesta.

So we think that those yields on costs will remain high and that will eventually benefit from our development strategy vis-a-vis acquisition strategy in lower cap rates. Secondly, we think that, I mean, construction costs have somewhat remained in the same levels. There have been some minor adjustments on cement and steel. And what is also important is the FX. But still with our estimated yield on cost, we believe that there is a lot of value to be generated from the development approach. So we will be careful and cautious on when to develop and where because now more than the cost, what is important is that lease-up periods are still in place so that we can be able to meet those returns. And if possible, in markets where we've seen rents increasing, of course, try to take that benefit on that right to and be able to increase returns as much as possible.

Your next question comes from the line of Pablo Ricalde with Itaú.

I have a question on your balance sheet regarding land acquisitions. I believe you will continue doing land acquisitions on the second half. How should we think of leverage by year-end, thinking of a lower EBITDA in 2025?

I'm sorry, can you repeat your question on EBITDA?

Yes, assuming like that maybe EBITDA will reach the bottom end of your guidance, and you will continue doing land acquisitions. How should we think of leverage as the debt-to-EBITDA target by year-end?

Okay. So net debt to EBITDA, thank you. Thank you, Pablo. So we have done very important land acquisitions in the past. More recently, the land acquisition in Guadalajara and the one that we did in Monterrey. So we have -- in the last, let's say, 12 months, we have been able to buy land in Mexico City, Ciudad Juarez, Monterrey and Guadalajara. This is going to be very helpful for our 2030 strategy. We are still might do a few more acquisitions in the second half.

However, we think that we are lining up very well to the development that we will start having eventually from 2026 onwards for our Route 2030. Our net debt to EBITDA, I don't have the exact number with us, but we are currently at very, very healthy levers in terms of leverage, loan-to-value, net debt to EBITDA, and we are very careful that even with the high capacity of leverage that the company has, we will be very mindful on the net debt-to-EBITDA ratios as well as loan to values so that they are not compromised. But I think that we are in a very attractive range. Maybe Juan or Fernanda, you have the exact numbers with you, but I don't think there will be a major increase.

Look, we have -- yes, exactly, Lorenzo. We have a very strong balance sheet. Currently, we have a net debt-to-EBITDA of 4x, 22.4% leverage ratio, a strong balance sheet, we can easily sustain the land acquisition strategy that Lorenzo has just pointed out. I'm not particularly worried. We have ample credit lines in place. So we can sustain the strategy set forth by Lorenzo at this point in time.

Your next question comes from the line of Antonio Hernandez with Actinver.

Just a quick one regarding what you mentioned in the press release that you're seeing an increase in leasing activity pipeline, expecting an acceleration towards year-end. If you could provide more color on which markets, are you seeing this? And how does this compare to your previous expectations?

Thank you. Well, first of all, I think that we all know that the start of the year was very slow when Trump -- President Trump took office and uncertainty was maybe at its highest together with volatility. Somewhat that has been lower in the recent months, particularly maybe right after Liberation Day. And as long as we continue to see more agreements in terms of tariffs between different countries in the U.S., we think that, that will trigger more companies to eventually look back into their plans for investment in manufacturing facilities in the right places, and that's where Mexico might benefit. We have seen a spike in number of visits of industrial parks in different regions, Tijuana, Monterrey, particularly Bajío and also the request for proposals. So that's how we mirror how much more pipeline or how much more activity we see.

And that's how eventually, decisions are made based on an analysis, and this is a very -- and it's a process, and this is a very important sign that companies are now looking back into their plans. Some of them were, let's say, paused or were just -- were freezed out. But now we are seeing a material number of visits, and we hope that, that will be helpful to be materialized in the next quarters -- I'm sorry, in the next half of the year. But we are very close with the broker community as well as government authorities, our own tenants and trying to keep a very tight communication and try to understand what their challenges are, what the opportunities. And with the information that we have been gathering from having that local presence, we feel confident that second half of the year will have more activity in terms of leasing and things will somehow level up.

Your next question comes from the line of Jorel Guilloty with Goldman Sachs.

I have two quick questions. One is on your leasing spreads. So we saw that there was a meaningful acceleration on a trailing 12-month basis, I believe it was above 13% and it's at least the highest we've seen since you started publishing those numbers. I was wondering if you can comment on what are your expectations for leasing spreads going forward. And then the second question is around your development pipeline. And I apologize if you answered this earlier, but it remained unchanged, so no new starts were added. And so I want to understand a little bit about your framework and how you think about development starts. So is the view here that development starts should remain muted until you see a meaningful increase in the lease-up of your existing property? In other words, I just want to understand what would be a trigger to start launching starts again? Those are my questions.

Thank you. Those are -- thank you for your questions. I think it's very important to highlight how resilient the portfolio of Vesta has been throughout these quarters. And I think a very -- a strong statement is the acceleration we have seen in renewal rates, trying to be able to mark-to-market many of the rents that are either expiring or just renewing in advance. And I think that number, it's real, it's very good. We have been increasing rents by 20%, 30% in certain markets. And that trend will continue in the upcoming quarters and even in the upcoming years, and that will generate and unlock a lot of value from the existing portfolio. So we're very positive also on the amount of -- the high retention rate that the company still has.

And maybe this is a positive signal, not only for Vesta, but also for the sector, where we continue to see companies committing to the long term, renewing their leases and even be able to increase rents. So that will continue to be the same situation going forward. And we are very disciplined and very proactive in working that out with our existing tenants. On your second question regarding development, we will definitely have starts in markets where we are fully leased like Guadalajara, where we recently acquired land just because we have a good pipeline, and the market is strong. And the reason why we have not started developments because we didn't have land.

We did it. And I think we are going to be benefiting from a strong momentum in that particular market in the electronics sector, e-commerce and logistics, which are key for us. Nevertheless, in other markets where we have recently developed, we have buildings to be leased up, we will be cautious that in order to start new buildings, we have to lease up the other ones. I think that discipline is something that we have had in the past, and we will continue to keep it that way. And we will benefit from that. And we think that we can anticipate when we had identified that there could be demand coming from existing clients, which actually remember that most of our growth comes from existing clients as well as new companies entering the market.

Your next question comes from the line of Francisco Suarez with Scotiabank.

The questions that I have are a follow-up on your land bank. Just to understand your -- the recent land purchases in Monterrey and Guadalajara, those are shovel-ready land. You have all the permits and everything, if you think -- because you mentioned that in markets like Guadalajara, you are more likely to start soon, isn't it, is what I understood on your past answer. And if you can also help me to understand why the revenues related with energy declined sequentially and year-over-year, that would be very helpful.

Thank you, Francisco, for your question. On your second question on energy, it's more -- remember that this is a pass-through mechanism. It has to do with the usage of our tenants. However, the income that we might have, it kind of matches the cost. So it really doesn't have a material impact if it increases or decreases because it's offset by the same amount almost by -- on the cost. On the land acquisitions, we are very careful and selective what type of land we buy. We regularly buy land that already has the use of land and some of the permits ready. However, there's always things to be done. There are always improvements to be done.

Sometimes it's more, sometimes it's less. But I think that these land acquisitions that we have done are similar to what we have done in the past where we -- that we might do the whole entitlement process and permitting and then we will start with the construction. So that's why it might take -- it doesn't need to take a lot of time, but it's a process to do the urbanization, earthworks, infrastructure. And -- but yes, the land that we acquired is ready to be developed soon. So we're very happy with the acquisitions and the opportunities.

One of them is adjacent. It's part of the Guadalajara project and the other one is going to be a new project. And then the one in Monterrey is -- again, it's urban infill where we will start -- when we kick ground, eventually, we will have to tear down a build -- an older building so that we can build a new one. So -- but it's part of the development process, and we are very excited about these opportunities that we have been able to find in a market where we can buy land at a better cost and create more value on the development process. These are highly desirable sites.

Your next question comes from the line of Abraham Fuentes with Santander.

I wonder if you could give us more color about the dynamics that you are seeing in Tijuana and Juarez in terms of absorption, vacancy and rents and how these trends could affect the performance of your portfolio going forward?

Well, Tijuana has experienced major rent growth in the last cycles, and that's why that has triggered more development. However, one of the -- there might be some major construction coming due in the next quarters. However, we still see that rents remain high. And eventually, the pipeline, we think that will pick up. We recently leased a couple of buildings in Tijuana with some of our existing tenants. So we see that there's activity from existing companies that are adjusting their supply chains. They're adjusting their production. Definitely, the tariffs adjustment globally has made companies also adjust their production. And I think that's how we are seeing the activity in markets like Tijuana, Ciudad Juarez also kind of felt a stable to positive rent growth.

And eventually -- and we saw some positive net absorption in the Ciudad Juarez market. There are some buildings available. However, the ones that will benefit the most are the ones that have the energy and have the utilities ready for companies to start operation, and that's where we think that Vesta has also an important advantage. So I think that second half is going to be very important to see how all these active users materialize their decisions. And we believe that Vesta is well positioned with good quality assets in the right locations and eventually we'll be able to close with good companies as we have done in the past.

Your next question comes from the line of Gordon Lee with BTG.

Just a couple of quick questions on thinking about your renewals over the next 18 months. I know that you mentioned in the release that roughly 5% of your leases will come due in the second half of the year. But I was wondering if you could remind us of what that number is for 2026. And what do you estimate the current gap in your stabilized portfolio to be between in-place rents and market rents?

Thank you, Gordon, for your questions. We currently have, I think, approximately 3% of GLA -- of total GLA, which is expiring this year. We have high expectations since we have a high retention rate that we're going to be able to renew many of these leases. And we think that if we -- the number that we saw this quarter of having rent increases in the 20%, 30% range for renewals, I think that, that will continue to be the same way in the second half. And going into 2026, approximately -- we might have approximately less than 4 million square feet to be renewed.

And we feel very -- we're confident that we're going to be able to -- whatever rents we have further from market to be able to close that gap, and that will generate a strong value. I don't know exactly how much it is for 2026. But I think that the trend that we have seen going upwards in the leasing and re-leasing activity will continue the same way going forward as rents continue to be high, and there's some legacy buildings that are expiring for -- are expiring in the next years. So that's going to be a huge benefit to unlock value on the existing portfolio.

And just to clarify, the 4 million square feet roughly that you mentioned for next year, is that GLA rolling over from your existing portfolio exclusively? Or are you also including the lease-up of new properties in that 4 million?

No, these are all properties that have a lease in place that is expiring next year. It doesn't contemplate the current vacant buildings. Vacant buildings are in the lease-up stage. That's different.

Your next question comes from the line of Alejandra Obregon with Morgan Stanley.

Mine is perhaps a little bit on your priorities when it comes to regional footprint. I mean, as you put together all the new land that you have acquired with what you have in stock, which markets do you think have more room for new starts, of course, when the time is right? Like you mentioned Guadalajara, but what are sort of your priorities as you put together all the external and internal factors, like which markets have more room, which ones are up in your list? I mean, as you can think of growth in the future.

Thank you, Alejandra. First of all, I think the priority for Vesta is to lease up vacant space because this is the one that will have an immediate impact on revenue. And I think that we have a clear marketing strategy so that we're going to be able to lease up to good companies at attractive and higher rates in markets such as Monterrey, Ciudad Juarez, Querétaro, and Tijuana, which is where we have most of the development activity or recent development activity. Eventually, the markets that we currently like the most are the ones where we recently acquired land, which -- that's Mexico City, Guadalajara. And eventually, when things get better, we can get back to other strategic markets for Vesta. But right now, I think in order to prioritize in the -- over the next quarters, I think it's mostly on the leasing activity. And eventually, we'll get to development.

Your next question comes from the line of Armando Rodriguez with Signum Research.

Congratulations on the operational numbers. Well, just a quick question regarding on your net income, if we -- can we have a sense of how much of this adjustment in the net income was explained by the exchange rate? That's my question.

Juan, can you elaborate on that, please?

Just to clarify, on my net income, what is the effect of exchange rate?

Yes. If we compare the net income to 2024, there's -- particularly on the earnings per share. On the earnings per share, we saw a significant adjustment. So I don't know if this is mainly explained by the exchange rate or maybe something other factors, financial factors that are not decide.

Well, let's go from the top. Remember that my -- basically, most of my properties are dollar-denominated properties, and we have actually increased that percentage on this particular quarter. Going down the income statement, most of our costs are peso related. And as the peso has appreciated, well, we have some pressure on margins, I guess. However, on the bottom line that you're referring to, most of the impact comes from the financial numbers, in particular, the loss that we had on revaluation of properties, which is a noncash item. But, however, on my bottom line, it does have an impact, which is why we emphasize pretax FFO. So that's why we -- the company has also emphasized that instead of looking at earnings per share, we should focus on pretax FFO because that doesn't suffer the impacts of the revaluation, which are volatile in nature.

Your next question comes from the line of [indiscernible] with GBM.

First of all, congratulations for your results. On my behalf, we have two questions. The first one would be with the nearly 120,000 square meters of inventory projects scheduled to deliver in August, could you provide more color on the expected leasing activity or financial impact in the second half of the year? And in another subject, with the operating cost up 5.3% compared to last year, mainly from taxes and insurance, do you see pressure in the second half of the year or some relief ahead?

Maybe to the first question, and then Juan, you can elaborate on the second one. We have -- the pipeline that we have under construction, which is basically projects in Querétaro and Monterrey that will be delivered in the next half of the year. We expect leasing activity to be between 3 months to, let's say, 12 months, and that's kind of how we do the underwriting. We think that these will be high-quality assets. And once the buildings are delivered, will be very attractive to be leased up and the marketing strategy is supported by bringing visits, taking clients, potential clients, and we feel comfortable on that underwriting assumption.

On the cost side, I think that as Lorenzo has emphasized, we're focusing on cost control. I think that we have been particularly successful this quarter and in fact, this first semester, controlling costs. On the quarter itself, increases in cost around 4.8%. Well, look, I think that we will maintain the discipline. We will meet our guidance in EBITDA and property costs as well. We have been quite conscious of them, and we have been containing them as much as possible. So I feel very comfortable on the cost structure of the company. We will continue to focus on savings, and we will be -- the second half of the year, I expect to have the same discipline.

Your next question comes from the line of Alan Macias with Bank of America.

Just if you can remind us of your exposure to manufacturing and to logistics and to e-commerce. And 5 years down the line, are you planning to have this breakdown change?

Sure. Thank you for your questions. We have identified long-term strategy towards our balance between light manufacturing and logistics. We currently are at -- maybe, Fernanda, you have the exact number, but let's say, maybe 55% manufacturing, 45% logistics, part of logistics is e-commerce, which is expanding. So we feel very comfortable that going forward, we will probably stay half and half just because we think that both sectors will be thriving. The type of facilities that we develop are very flexible to accommodate logistics, e-commerce, light manufacturing.

And I think that, that is key on the -- on our portfolio strategy. And more importantly -- or let's say, not more important, but also very important, it's not only the sector, but also the type of companies we do business with. We have long-term leases with outstanding companies. We are very disciplined in the type of global tenants that we do business with. These are companies with corporate guarantees, high credit rating, and that's very important to have in place. And then -- another important disciplined approach that Vesta has is our high number of dollar-denominated leases.

And we will continue to emphasize how important this is for Vesta. We believe over the long term that the dollar will continue to have more value than the peso. Financing cost on the dollar is more competitive, and we can continue to have very attractive spreads. And that's -- and for that reason, we think that, that's one of the main advantages on the company vis-a-vis our -- some of our peers who have the majority of their income in pesos and does not offset with the majority of their obligations, financial obligations and debt in U.S. dollars. So I think this discipline is key, and we will continue to have a well-balanced portfolio.

Your next question comes from the line of [ Octavio Arias ] with Signum.

This is from Signum Research. I have two questions. The first one is, as the market evolves, are you considering more vertical integrations to better serve tenants and capture more value? And have you seen any new or specific demand from tenants lately in the sector?

Can you elaborate more on vertical integration?

Yes, yes, like in-house projects or energy solutions for tenants?

Sure. Well, I think that Vesta -- one of the key differentiators that we have to other vehicles is that we are vertically integrated. We have the development platform in-house. We do not have external parties doing development or doing other things. However -- and that is something that we have highlighted over the years that we have a particular vertical integration in the structure. I think that the only other items that we might -- that we are considering is some services like renewable energies or solar panels and those sorts of things, which are very important.

But we also already have several of those features in our projects. In the end, what we want to do is serve better our tenants and make sure that we are enablers for them in all the real estate aspects needed, energy being one of them, some of the property management that we do also for them. And I think that, that's why in this particular situation, it's key to have a closer relationship with tenants and try to have the best service as possible as needed. So we will continue to evaluate alternatives that help us to provide that service.

My second question is with the current stabilized occupancy, is there any interest like in asset recycling or divesting mature properties to fund growth in your view.

Yes, that's a good point. We might have some asset recycling. It's part of the long-term strategy. We'll do it now every now and then. And at the moment, I think that the key priority is to lease up the lease-up properties, the vacant space or the project that we have recently developed. But every now and then we will continue to do some asset dispositions, too.

And it seems that we have no further questions for today. I would now like to turn the call over to Mr. Berho for his concluding remarks. Please go ahead, sir.

Thank you, and thank you, everyone, for joining us today. As we have noted, Vesta's strategy is focused, protect value, strengthen our base and prepare for what comes next. Our platform is healthy. Our assets are well positioned, and our team is aligned around execution. We continue to move forward with our 2030 strategy, supported by a flexible capital structure, a resilient portfolio and a clear view of long-term value. Thank you all.

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