Good morning, and welcome to the Fourth Quarter and Fiscal Full Year 2016 Investors Real Estate Trust Conference Call. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Steven Swett. Please go ahead.

Thank you, and good morning. IRET's Form 10-K was filed with the SEC yesterday after the close. Additionally, our earnings release and supplemental disclosure package have been posted on our website at www.iret.com and filed yesterday on Form 8-K. Before we begin our remarks this morning, I want to remind you that during the call, we will be making forward-looking statements, which are predictions, projections or other statements about future events. These statements are based on current expectations and assumptions that are subject to risks and uncertainties. Actual results may materially differ because of factors discussed in yesterday's Form 10-K and the comments made during this conference call and in the risk factors sections of our annual and quarterly reports and other filings with the SEC. Investors Real Estate Trust does not undertake any duty to update any forward-looking statements. Please note that our conference call today will contain references to financial measures, such as funds from operations, or FFO and net operating income, or NOI, that are non-GAAP measures. Reconciliations of non-GAAP financial measures are contained in yesterday's press release, and definitions of such non-GAAP financial measures can be found in our most recent supplemental operating and financial data, both of which are available in the Investor Relations section on our website at www.iret.com. With me today from management are Tim Mihalick, IRET's President and Chief Executive Officer; and Ted Holmes, Executive Vice President and Chief Financial Officer. I will now turn the call over to Tim.

Thank you, Steve, and good morning, everyone. Welcome to our Fiscal Fourth Quarter and Full Year Earnings Conference Call. This morning, I'll begin with an overview of our operating and fiscal results for the quarter and full year. I will then update you on our strategic repositioning efforts, including our announcement earlier this month to move towards a pure-play multifamily REIT. After that, Ted Holmes, our CFO, will provide a more detailed review of our quarterly and full year results, an update on our transaction activity, summarize our balance sheet and capital allocations strategy and, finally, provide an overview of our guidance for 2017. We will then open the call for your questions. Our fourth quarter and full year results demonstrate the value of our ongoing effort to reposition our portfolio into a more focused growth-oriented and scalable platform, which we believe is the best path for long-term value creation for our shareholders. While our overall core results are down from the prior quarter and year, our cash flows are stronger and more predictable and, we believe, provide us a better base from which to grow results in the future. Yesterday, we reported FFO of $19.2 million or $0.14 per share and unit for the quarter ended April 30, 2016. We continue to show top line growth, as our total revenue was $48.5 million, which was an increase of $3.4 million or 7.5% compared to the same period 1 year ago. For the full fiscal year ended April 30, 2016, we reported FFO of $103.9 million or $0.76 per share and unit. Additionally, total revenue for the year was $188.3 million, which was an increase of $9 million or 5% compared to the prior year. Within our multifamily same-store portfolio, as anticipated, our same-store NOI decreased by $550,000 or 3.8% in the fourth quarter as compared to the same period of the prior year and decreased by $2.9 million or 5% for the full year compared to fiscal year 2015. Ted will discuss our same-store results in more detail, but I'd like to note that excluding the energy-impacted markets in western North Dakota, which accounts for just 8.4% of our multifamily same-store NOI, our portfolio generated solid growth of 4.8% in the fourth quarter, which was a strong acceleration from the 3.1% we reported in the fiscal third quarter. Looking ahead, we will continue to monitor conditions in our oil-impacted markets, but the remainder of the Upper Midwest has a thriving economy with the lowest unemployment of any U.S. region and a favorable business climate that supports growth across many industries, including health care, technology, financial services and manufacturing. With construction activity slowing down on a macro level, we expect healthy fundamentals to continue for the foreseeable future. While we may experience some variance quarter-to-quarter in our multifamily same-store results, over time, the delivery and lease up of our high-quality multifamily developments as well as our accretive acquisitions, which are operating at attractive margins, should eventually contribute to stronger and more stable portfolio and same-store NOI growth. Additionally, we continue to improve upon operations as we scale our platform and utilize new technology. As we have discussed, we are under way with the implementation of our rent optimization program, which we believe will allow us to drive revenue as we better capture demand and more efficiently time expirations within our market. We plan to roll out this program to our entire portfolio throughout fiscal year 2017. Additionally, we are in the process of implementing a RUBS program, which we believe will meaningfully reduce volatility quarter-to-quarter in our operating results. Based on our portfolio review, we believe we can implement a RUBS program in about 85% of our multifamily units. Currently, the penetration of our RUBS program is about 48% of these potential units, and we expect it to be rolled out to substantially all the planned units by the end of the third quarter fiscal 2017. Turning to transaction activity. We continue to make great progress on executing on our strategic transformation. During the fourth quarter, we disposed of $31.8 million of non-core assets, bringing our total gross proceeds from asset sales to $490 million in the last 24 months. We continue to redeploy these proceeds into attractive multifamily acquisitions as well as completion of our development pipeline. During the fourth quarter, we purchased a 4-property portfolio in Rochester, Minnesota for $71.8 million. Over the last 9 months, we have deployed a total of $194 million of capital into new and/or leading multifamily properties, including $137 million of acquisitions and $57 million into new developments. Further, based on the progress we have made to date, we announced the continuing evolution of our strategic plan to become a pure-play multifamily REIT. We intend to dispose of the remainder of our non-core properties, which includes 33 medical office buildings, 34 senior care facilities and 7 industrial properties. As sales occur, we expect to utilize proceeds to fund additional investments in multifamily properties, reduce leverage and pursue other capital allocation opportunities. Let me discuss in more detail why I believe this is the right strategy for IRET at this time. First, the transformation into a pure-play multifamily REIT will simplify our strategy and produce a more stable income stream with better long-term potential growth for NOI and FFO. Multifamily has demonstrated a consistent track record over many cycles of steady demand, strong growth and premium valuations compared to alternative property types. IRET is committed to being the premier owner operator within the upper Midwestern states, and I believe we can grow IRET while we produce earnings, growth and appreciation for our shareholders. Second, this builds on our own history as a company as we have demonstrated a track record of developing, managing and acquiring multifamily assets in the Upper Midwest. We have a unique opportunity to use our market knowledge and industry relationships as the only REIT operator in these core markets. And our access to institutional capital gives us a strong competitive advantage over local private investors. Further, the multifamily sector offers unique and proven opportunities to achieve economies of scale and implement best practices to further expand operating margins, which, again, provides an advantage over local operators. With our platform in place and key initiatives under way, such as LRO, RUBS and value-add, we believe we are well on our way to driving margins higher. Third, current market pricing for our high-quality market-leading healthcare and industrial properties remains strong. We are extremely pleased with the value we have been able to unlock through most of the $490 million of sales we have completed in the last 24 months, and we believe now is the time to move ahead to complete the evolution of the company. While we are not providing expectations at this time for timing or pricing, we will communicate our progress as we move forward. In closing, I am pleased with the progress during the past 18 months as we execute on our strategic transformation. Certainly, as I have discussed throughout our strategic transformation, these changes will not come without some disruption in near-term cash flow. However, the executive team and the Board of Trustees fully believe that our transformation to a pure-play multifamily platform will produce a company with a more stable, faster-growing, more highly valued income stream that will ultimately produce attractive returns for our shareholders. We will continue to update you on our progress and accomplishments in the coming quarters. Thank you. And I would now like to turn the call over to Ted Holmes, IRET's CFO.

Thank you, Tim, and good morning, everyone. Today, I'll begin with our results for the quarter and year, then I will provide an update on our recent transaction activity, balance sheet and liquidity position. I will close with an overview of our guidance for fiscal year 2017, which we are providing for the first time. Then we will be happy to take your questions. Yesterday, we reported FFO of $19.2 million or $0.14 per share and unit for the fourth quarter ending April 30, 2016 as compared to $22 million or $0.17 per share and unit for the same period of the prior year. I would note that our fiscal fourth quarter 2016 FFO included a $3.4 million gain related to a bargain purchase adjustment, and net of this gain, our FFO was $0.12 per share. The decrease in FFO per share was primarily due to a decrease in property NOI due to the dispositions completed in the last 15 months, partially offset by the acquisitions made and developments completed. For the full fiscal year ended April 30, 2016, we reported FFO of $103.9 million or $0.76 per share and unit as compared to $86.6 million or $0.64 per share and unit for the prior year. Our fiscal year FFO increased primarily due to a $36.5 million gain recognized as a result of a transfer of mortgage debt to a loan servicer in the third quarter ending January 31, 2016, and the bargain purchase gain mentioned previously. Excluding these items, FFO for the fiscal year ending April 30, 2016, would have been $0.55 per share and unit. Our total revenue increased by $3.4 million or 7.5% for the 3 months ended April 30, 2016, compared to the same period of the prior year. Total revenues for the company increased by $9 million or 5% in the 12 months ended April 30, 2016, which can be attributed to development deliveries and acquisitions in our multifamily and healthcare portfolios offset by revenues related to assets disposed of during the fiscal year. It is worth noting that during the fiscal year period, our total debt outstanding decreased by $123 million. Turning to our multifamily same-store results. Our fourth quarter same-store multifamily revenue decreased by 1.7% year-over-year, which was primarily due to continued weakness in our energy-impacted markets. Operating expenses were up 1%, resulting in a 3.8% decrease in multifamily same-store NOI. If we exclude, however, the results from Minot and Williston, North Dakota, which are our energy-impacted markets and account for only 8.4% of our multifamily same-store NOI, our revenues increased 3.2% and our NOI was up 4.8% compared to the fourth quarter of 2015. For the full year 2016, multifamily same-store revenue decreased 0.5%. Property operating expenses increased 5.3% and NOI decreased 5% compared to the prior 12-month period. Again, if we exclude the energy-impacted markets of Minot and Williston, multifamily same-store revenue increased by 3% for the year. Property operating expenses increased 4.9% and NOI increased 1.4% compared to the prior 12-month period. Going forward, we expect our operating costs to normalize as we condense the portfolio platform and our operating margins expand as we add recent acquisitions and development completions to our same-store pool. Turning to our value-add program, through which we believe we can improve the competitive position of our portfolio and achieve attractive returns on our capital. For the full fiscal year 2016, we spent approximately $3.5 million on this program, achieving average rental increases on re-lease, which were about 11% above the prior rent, representing an 11% return on this capital. Going forward, as we have said in the past, we expect to spend approximately $3.5 million per quarter, capturing a return on capital of roughly 8% to 10%, with unit work commenced on lease expirations. As of April 30, 2016, we have 539 units currently in this program, with 349 leased and complete, 190 units under construction, with an additional 1,500 units identified to enter the program in fiscal 2017. During the fiscal fourth quarter, we made meaningful progress on our strategy to dispose of non-core assets, acquire multifamily assets, complete and lease up our development pipeline and grow our same-store multifamily NOI. We acquired a multifamily portfolio comprised of 393 units at 4 properties located in Rochester, Minnesota for a total purchase price of $71.8 million. These high-quality luxury townhomes are a strong addition to our platform, and this acquisition solidifies our presence as one of the largest apartment owners and operators in the growing Rochester market. We did sell 8 student housing properties, one healthcare property, one retail property and one unimproved parcel for total proceeds of $31.8 million during the quarter. As we have announced, we intend to sell the remainder of our nonmultifamily assets and recycle proceeds towards multifamily assets in our core markets. At the end of fiscal year 2016, we did classify our entire senior housing portfolio as held for sale. Additionally, we continue to derisk our portfolio as we deliver on our development pipeline. In the fourth quarter, we delivered 2 multifamily development projects at a total cost of $74.6 million. For the full fiscal year, we delivered 7 projects totaling $211.9 million of development costs, of which $152 million was multifamily assets comprised of 4 properties and 774 units. As we have noted in the past, the completion of projects on our development pipeline results in a near-term drag as units are delivered and interest costs are expensed rather than capitalized. Ultimately, however, as these properties stabilize, we have seen the full benefit of our investment to the bottom line, with returns on stabilized developments ranging from 6% to 10%. Turning to our balance sheet. As of April 30, 2016, we had $66.7 million of cash on hand and $82.5 million of availability on our line of credit for a total liquidity of $149.2 million to fund our growth initiatives. At quarter end, our weighted average interest rate on our mortgaged debt was 4.54% and our weighted average term to maturity was 6.5 years. Additionally, at quarter end, our leverage ratio was 48% of gross assets at cost, which continue to keep leverage below 50%, and our maturity schedule in the coming years is manageable, with $130 million and $46 million of debt due for repayment in fiscal years 2017 and 2018, respectively. We intend to utilize a portion of our disposition proceeds to reduce debt, and we are committed to growing our unencumbered asset pool and eventually obtain an unsecured line of credit with a longer-term goal of achieving an investment grade rating. Moving on. On June 2, our Board of Trustees declared a regular quarterly distribution of $0.13 per share and unit payable on July 1, 2016, to common shareholders and unitholders of record at the close of business on June 15, 2016. This will be IRET's 181st consecutive distribution. The board will continue to review the distribution policy on a regular basis. Finally, in an effort to enhance our disclosure, we are introducing FFO guidance for the fiscal year ending April 30, 2017, in the range of $0.48 to $0.54 per share and unit. Please note that this guidance reflects our view of current market conditions and does not incorporate the impact of any acquisition, development, disposition or capital markets activity, including potential transactions discussed as part of the company's strategic initiatives. Further, this guidance assumes same-store multifamily NOI growth of between 2% to 4% for the fiscal year. In addition, G&A expense of between $13.3 million and $13.7 million for the fiscal year, which includes approximately $2 million expected to be accrued under the company's incentive compensation program and which was not earned in fiscal 2016. As transactions are completed, we expect that we will update our guidance as appropriate. Thank you all for joining us today. And with that, I will turn the call back to Tim.

Thanks, Ted. Our entire team is focused on executing our strategic repositioning plan as we work to dispose of non-core assets and redeploy the proceeds towards accretive acquisitions and our value-add program. Ultimately, our goal is to become a pure-play multifamily REIT, offering us significant opportunities to expand our platform to drive improved efficiencies and operating margins and market-leading results. While some of these transactions may impact our near-term results, we are confident that we are creating a stronger and more stable income stream with significantly enhanced growth potential that can create meaningful long-term shareholder value. With that, I'd like to open the call up for questions. Operator?

[Operator Instructions] Our first question comes from Drew Babin of Robert W. Baird & Company.

I was hoping you could clarify the 2% to 4% same property NOI growth guidance. That includes the energy markets as well, correct?

Correct. And I'll let Ted touch on that for you, Drew.

That's correct, Drew.

Okay. And then would it be possible to break down what you expect to see in the energy markets as well some other markets in the Dakotas that are seeing some supply in terms of -- occupancy seems to have bottomed in North Dakota at the expense of rent growth. What dynamics do you expect kind of over the next 4 quarters there and what could that look like?

Drew, this is Ted. I do think we've seen a bottoming out in many of the markets from an occupancy standpoint, including, we think, Minot, Bismarck, Grand Forks. We're still trying to find a pulse on Williston itself, so there may be still some deteriorations there. But we think stabilization in that market may be anywhere from 70% to 75%, given our same-store property there. We do think that the balance of our markets will begin to see rent increases as now we've kind of bottomed out at where we think occupancy needs to go and rents can grow from here in, really, the balance of our markets, including, for that matter, Minot and Bismarck and Williston. Now from a comparative period standpoint, we may be still comparing ourselves on a quarterly basis to some very strong periods a year ago going forward for a little bit. But certainly, we're going to be going in the right direction going forward.

Okay. And then secondly, the assets held for sale, can you talk at all about the just projected timing of that? And I assume that what's already held for sale is likely in guidance for the year. If not, please correct me. But for modeling purposes, could those dispositions be assumed to be kind of spread out evenly throughout the year?

Yes, I'll let Ted touch on that again and update if that includes guidance.

Drew, the held for sale assets from a timing perspective, as we noted in our filings, we had a tenant exercise an option on 8 of the properties, senior housing properties that they have an option on. There's no guarantee that, that closes, but they have exercised and given notice of an option. And that is most likely a second quarter '17 event, but, again, no guarantees. The balance of the held for sale assets, really no gauge yet on timing. We've got a lot of work to do there to get those to a process that we can execute on the sale of those assets. So I really don't have a timing on those, but for potentially the one industrial asset. That one, we would expect if not the first quarter of '17, but the second quarter of '17, okay? And the assets mentioned in held for sale are in our guidance numbers. They're reflected in the range that we've given. So as those sales occur, we will need to be providing an update to you and others about where we think FFO will go. There's no guarantee these sales go through, so we left them in our guidance suggestion for now.

Okay. And then lastly, you talked about longer-term leverage targets and trying to get the investment grade rating down the road. Might we see a temporary increase in leverage just over the next few quarters in order to kind of keep cash flow relatively stable during the transition? Or do you -- would you expect the leverage ratio to kind of just trend down smoothly?

Drew, I think we'll see a flat leverage ratio over the next couple of quarters. And again, our goal, ultimately, is to bring that leverage target down. So I don't think you'll see an increase.

Drew, this is Ted. Just to point out that the goal of going to investment grade and unsecured, that's going to take some time, that takes deleveraging. And we've indicated that as a result of these strategic plan initiatives, our primary goal is to replace income and continue to evaluate our capital allocation strategy, but deleveraging is certainly part of what management wants to accomplish, but that's going to take more time than fiscal '17.

Our next question comes from Jim Lykins of D.A. Davidson.

First, with a follow up on that last guidance question. The assets held for sale that you said are in guidance, can you be a little more specific and tell us what the FFO impact would be?

Well, again, I think as those sales occur, if they occur -- when they occur. Not if, when they occur, we will be providing that update. I think it's a little premature. From a timing perspective, the FFO effect will not only be affected by the perfection of the sales, but the timing of the sales. So I think it's a little premature. The income today is in guidance. So we'll be making those adjustments when those sales occur. But the sales themselves are not in the guidance reflection. Does that make sense?

Yes, I got you now. The 2 development projects that just came online in North Dakota, I don't believe that the Grand Forks property is really impacted by the Bakken, but what about Jamestown? Can you talk about the impact from the Bakken and also how leasing is progressing since the end of the quarter at both properties?

Jim, this is Tim. The Jamestown property really is not Bakken impacted. We don't -- that's a little farther east in the state, so there's really not a big impact there. Leasing is continuing as we expected, not as strong as we had hoped, but we think long-term initiatives and some of the things we're implementing will bring that leasing up a little stronger. The other property -- go ahead. I was going to say, the same as on the other properties, as we look at it, we're seeing leasing, to some degree, moving forward in the other North Dakota property.

Okay. And one last question. The dividend is in the middle of your guidance range for the year. Could you just talk about the commitment to maintaining the current dividend level?

Jim, again, as we've talked about in the past, and I've said this on occasion, that the dividend is a decision that's made by the Board on a quarterly basis. So at this point, we will continue to present the information to the Board and let them make that decision quarterly.

[Operator Instructions] Our next question comes from Carol Kemple of Hilliard Lyons.

On the development pipeline, do you think once you finish these 2 apartment communities, you're going to step back from development for a while? Is that a good way we should look at it?

I would think so, Carol. I think our first choice going forward will be to search out acquisitions and hopefully find those and step back from development. As I mentioned in my remarks, we see construction on the macro level slow down. We think that will be a pullback for us also.

Okay. And then on the medical office and the industrial assets that you all wanted to sell, have you put those out to the market yet? Or where are you at on that?

We have not. We've not broadly marketed any of that but we will begin to undertake that and give some thoughts going forward.

This concludes our question-and-answer session. I'd like to turn the conference back over to management for any closing remarks.

Thank you, and thank you again for all of you spending some time with us this morning to get an update on where IRET is at. We're certainly excited about the future of the company as we complete and move forward with this transition, and believe that, again, we can become the premier REIT in the Upper Midwestern part of the United States. With that, have a happy Fourth of July, and thanks for taking your time.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect your lines.