Good day, and welcome to the Cousins Properties’ Second Quarter Conference Call. Today’s call is being recorded. At this time for opening remarks and introductions, I would like to turn the call over to Tripp Sullivan of Corporate Communications. Please go ahead sir.

Thank you. Certain matters that company will be discussing today are forward-looking statements within the meaning of federal securities laws. For example, the company may provide estimates about expected operating income from properties, as well as certain categories of expenses along with the expectations regarding leasing activity, development, acquisition, financing and disposition opportunities. The company will also provide information about the Texas acquisition, including matters related to the confirmation of the acquisition, the financing of the acquisition, and the effects of acquisition, including its impact on accretion and leverage. Such forward-looking statements are subject to uncertainties and risk and actual results may differ materially from these statements. Please refer to the company’s filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2012 and its current report on Form 8-K filed on July 29, 2013 for additional information regarding certain risks and uncertainties. Also, certain items that company may refer to today are considered non-GAAP financial measures within the meaning of Regulation G, as promulgated by the SEC. For these items, the comparable GAAP measures and related reconciliations may be found through the quarterly disclosures and supplemental SEC information links on the Investor Relations page of its website at www.cousinsproperties.com. And now, I’ll turn it over to Larry Gellerstedt.

Good morning everyone. I am here with Gregg Adzema, our Chief Financial Officer and Colin Connolly, our Chief Investment Officer. Thank you for joining us on such short notice. We have a lot of exciting things to discuss today and we look forward to getting everyone up its feet on all fronts. As I am sure you will understand we are under fairly tight time constraints today and I will ask during the Q&A that people limit their questions to one question and one follow-up, so that we can try to get to everybody and maintain our schedule. It was another solid quarter highlighted by the 816 acquisition and the commencement of Colorado Tower in Austin. We were also pleased with our leasing progress, particularly at Promenade and 2100 Ross. Our portfolio which finished the quarter at 90% occupied up from 87% one year ago continues to benefit from a sustained run of positive leasing momentum. Our same property net operating income, which increased 5.5% over the prior year in the office portfolio, is perhaps the best reflection of this progress. I will briefly provide some additional color on leasing and investment activity as well as our dispositions in the process. I will then finish with an overview of the strategy, and while the Texas Office Portfolio transaction presents such a compelling opportunity for Cousins. Leasing activity in our Texas portfolio, our current Texas portfolio remains strong across the board, while overall activity in deal terms continued to improve in Atlanta. Buckhead and North Point in Atlanta have been particularly vibrant year-to-date with Midtown not too far behind. Downtown, where activity is generally sluggish, remains the one exception. To give some additional context on why we are focused on Texas? I would like to give some additional context on why…

Thanks, Larry. Good morning everyone. Overall, we had a solid and productive second quarter. From an earnings perspective, FFO was $0.12 per share, $0.14 per share after adjusting for the $2.7 million non-cash cost associated with the early redemption of our 7.75% Series A cumulative preferred stock that I spoke of in the last quarterly conference call. Beyond earnings, I think the primary theme of the quarter can be wrapped up in three positive events. First, we achieved same property net operating income growth of 4.7% during the second quarter compared to the same period last year. It was 5.6% on a cash basis. And the most encouraging part was that this growth was driven by our office portfolio, where the same property cash NOI growth was 6%. Next, as Larry previously discussed, we acquired 816 Congress in the Austin, Texas CBD during the second quarter. Not only was this a strategic fit for us, we funded this acquisition predominantly with a common equity offering in April. During this offering, we also raised additional capital to redeem our Series A preferred stock that I referred to earlier. In total, we raised a $165 million in new equity. These transactions allowed us to both grow the company and improved the balance sheet at the same time. Finally, we commenced construction on Colorado Tower also in the Austin CBD during the second quarter. After initially having the landowner as the potential partner, we were able to agree on a ground lease purchase option structure that allowed us to develop this asset as a 100% owner. This means we will develop this asset on balance sheet without third-party construction debt. It’s a much simpler approach that provides us with all of the economics of the deal. With that, let me move on to…

Thank you, Gregg and thank you all for participating in today’s call. Greenway Plaza consisted 10 office buildings and a small retail component and all into those 4.4 million square feet over 52 acres. It is a very unique asset and that it’s effectively a standalone submarket centrally located between Houston’s other leading urban submarkets, which are the Central Business District to the East and the Galleria to the West. The property also benefits from its close proximity to River Oaks, which is one of Houston’s most affluent residential neighborhoods and home to many of the city’s corporate decision-makers. Greenway Plaza was one of the Houston’s first mix use projects, and today it blends a cohesive campus-like feel with the market leading amenities and conveniences that tenants expect in an urban setting. The project is currently 92% leased to a high quality roster of large corporate users from primarily the energy sector as well as financial services firms and other leading real estate companies. Occidental and Invesco both A rated by S&P anchored the portfolio and account for approximately 26% of the total rentable square footage. Both tenets have more than 10 years of remaining lease term with Occidental’s next expiration in 2026 and Invesco’s in 2023. Across the entire Greenway portfolio there is approximately 6.4 years of weighted average lease term which offers a nice balance of stability and some near term opportunity to rollup in place rents which are approximately 90% fully marketed in our estimation. On a go forward basis, we believe that Greenway Plaza will continue to benefit from a loyal customer base that has a demonstrative legacy of organic growth. As an example Occidental, Invesco and Transocean have all been tenants at Greenway since the 1980’s and collectively have grown by almost 1.4 million square…

Okay, so we will open it up for questions and we’ll let operator start. Let them come through.

Thank you. (Operator Instructions) And our first question comes from Brendan Maiorana of Wells Fargo. Please go ahead sir.

Thanks, good morning. Colin, good enough to give some of the yields on a gap and cash basis, looking at Greenway Plaza I was just kind of interested in the outlook of how quickly you guys think you can sort of get your – or where you think you can get cash yields over the next few years because if I look at it looks like the occupancy is fairly high at 92% and I think you mentioned there are some large tenants that have some steps in rents, but it doesn’t look like there is a huge amount of role in the near-term. So, where do you think you kind of get that cash yield over the next say, three years or so?

Hey, Brendon, it’s Colin and again appreciate your participation this morning. I don’t know that we can kind of get into the specifics of kind of what our projected yields are over the coming years. I guess I’d try to provide a little bit of color and visibility to you as I mentioned there are several very significant tenants within the portfolio that you have contractual step-ups in their rent to market that will kick in over the next few years. So, you really don’t actually even need expirations to get a pretty meaningful pick up in yield but again there are also some near-term expirations one of the largest tenants, but we feel that those are below market and again if we got confidence in the strength of the Houston market and our ability to work for those existing tenants to move them up to markets as well. And again the building is 92% leased as were seeing in Huston today and certainly with our Post Oak investment we do believe we’ve got the ability to drive occupancy further from where it is today.

Okay, that’s helpful. And then may be just a follow-up on that, can you provide a sense of again at Greenway are there any near-term or longer term costs that you think may need to go into that asset to bring it up to kind of the way that Cousins typically likes to run their assets?

Sure. I think we were – we have tracked these Greenway assets for quite some time and as I think we actually got into there mid-year, we were pleased and not at all surprised that the condition that were in which is in very good shape. These assets have obviously been owned by the joint venture between Crescent Real Estate and Barclays for the last several years again very well capitalized owner. And prior to that they were in the public arena owned by Crescent Real Estate equities which was one of our competitor REIT. So, they have been owned for quite some time by very large institutional oriented owners and as our team spends significant time on these assets I think our view is that the condition today, the systems, the back end house they are very similar to our existing portfolio and how we manage and take care of our assets.

Okay, thanks. I will get back in line.

Thank you. And our next question comes from Dave Rodgers of Baird. Please go ahead.

Yeah, hey good morning guys. Thanks for question – taking the question. I guess maybe Larry talk a little bit maybe how the Crescent transaction came above maybe any another trigger points that were out to negotiations and any remaining hurdles. And then if you could maybe give a little more detail on your two and your four rollovers at Greenway? Thanks.

You bet. Dave, thanks. This has really been a fantastic transaction for us and the history of it’s really interesting, so we in 2008, 2009 some of you may remember Cousin’s Properties was hired by at that time Morgan Stanley who was a owner of Crescent after it went private to do evaluation of the entire portfolio. And so during that process we really got a very deep look at every asset both in the office portfolio as well as the other diversified holdings that Cousin had. And so we been tracking these assets and as a matter of fact it’s interesting that a couple of the assets that were in that portfolio that Crescent spun out before this acquisition we’ve actually required being remaining 816 Congress and Post Oak, so we got to know those assets well during that process. And this process was really not a widely marketed process Barclays and Crescent given the size of the transaction and their desire for speed and certainty and no one could make an offer with any financing contingency, it was a very limited pool. And it was a very relatively short process which we were pleased with on both fronts. And at the end of the day certainty to close certainly, was as important as price as well as I think in this case, Crescent is a first operation. They really managed their assets well and take care of their customers well. And we were a very important part of this transaction from our perspective is the team of people that will be joining Cousins Properties that are currently on the Crescent team. Their property management people and leasing people really bring a fantastic depth and experience to bring to our Texas platform. And additionally we will be able to utilize those resources to some of the assets I mentioned earlier that they previously own that we are currently using third party management or leasing folks, we’ll have the opportunity to work at bringing those things in-house. So, it really is a combination I think in the lot of them that we wanted their people in addition to the financing and price things. I will let Colin address the role in terms of Greenway.

Sure. And I think you are looking at the investor presentation in year two say what’s primarily driving that is Exxon Mobil. And in year four that would primarily be driven by Transocean. I would – I guess point out to give a little bit of color there as I mentioned in my prepared remarks Transocean has been a tenant in Greenway Plaza since the 1980’s and I think really highlights the stickiness and wellness of the tenant base which really enjoys kind of a central location here in between CBD, the Galleria proximity to River Oaks. And but I think it’s actually often kind of overlooked here. You are also in very close proximity to the Texas Medical Center. In both cases and kind of both years, the tenants I just mentioned are called less than 50% of that expiration that you see others are made up of kind of smaller much smaller tenants but those would be the two big ones.

Gentlemen are you ready for the next question.

Yes, we are.

Thank you. (Operator Instructions) And our next question comes from Erin Aslakson of Stifel. Please go ahead.

Hi, good morning. Just I guess given the cyclicality historically of Houston I guess what is your outlook going forward in terms of that market?

We’ll, Erin one of the things that really has attracted us and why this Houston is center part of our strategic drive for the last three or four years. It’s really the shift and what’s going on in our country as a whole in terms of energy and Houston is not only oil but its gas and it’s all the engineering support that goes to support those industries. And in addition all the other forms of energy that alternative sources of energy. So, it’s really now become the global center for energy and the U.S. obviously is going through a revolutionary change in terms of our energy position relative to the rest of the world. So, we think that if you look at Houston in the last 10-year period it’s been a very strong performer throughout the cycle, it really did not get impacted in any significant way by the recession. And all projections are that it will continue to do well. And it’s not just totally dependent upon energy, its got one of the largest ports are there in the country, which with the widening of Panama Canal will continue to benefit. It’s got one of the most largest and most respected medical centers anywhere in the country that’s right near Greenway. So, not that any city is recession cycle proved, but we really think the prospects of Houston continue to be very strong and probably the strongest than any of the markets we currently are in.

Thank you.

And thank you. Our next question comes from Michael Knott, Green Street Advisors. Please go ahead.

Good morning guys John Bejjani here. So, a quick question just more strategically previously Larry you mentioned you’re kind of targeting desired concentrations around 40% in Texas, 40% Atlanta and then another 20% North Carolina. Would you say that basically that’s still the goal following this transaction or is there anything or is there transaction or anything else you see material impact that you are thinking?

No, it really hasn’t I mean we obviously if you look at the relative size of those markets, we think the concentration that we currently have in Texas is fantastic and appropriate. And we are just thrilled we have been able to source these opportunities. If you go through the opportunities this and this one in Post Oak really we are certainly not widely marketed and Post Oak was the market that allows us was a very limited process. And so we’ve been able to source some things in Texas that we think are extraordinarily compelling 2100 Ross also we did very creative deal the new tower in Houston. So, the only fully marketed deal is 816 Congress which we used to manage and so we know that asset well. So, we like the concentration, we also like Atlanta. Atlanta is really showing some very strong economic data in terms of job growth and projections expect to be in the top five in the country and it’s had some fantastic corporate relocations and just internal job growth. And we’d love to find some more stuff in Atlanta to add to our platform. North Carolina continues to be strong. We just did not found something that’s just right for us or that we were able to achieve the pricing that other people in the market were able to underwrite or on some assets there. So, I really like the blend of where we are and we’ll continue to be more opportunistically driven within those three markets then try to maintain a real tight balance with percentages.

Okay, that’s helpful. I guess on the funding front you mentioned non-core asset sales, so just a quick question given the rise in interest rates that we’ve seen lately. Are you seeing, are you expecting to see any impact on pricing for any of those assets.

The – thus far, I think the sales that we’ve been doing, we have not seen an impact on them. And I think that’s really a combination of the tight product that was and the location it was as well as we took these assets to market really before the lightest little spike in interest rates. So, what impact it has on go forward sales, it will have to have some to the levered buyers and I’m sure that that we will see that, but we haven’t seen in any of that in our current asset sales that we mentioned.

Great, thanks guys.

Thanks for waking up early.

Thank you. And our next question is a follow-up from Brendan Maiorana of Wells Fargo. Please go ahead.

Thanks. Larry, you mentioned that you guys have been really good at harvesting value and it’s – when it’s presented itself. When you look at Greenway, I mean, there will still be about a third of the asset value of the new Cousins, but it’s a portfolio and I think historically it’s been a portfolio that’s probably difficult to breakup and may be something that you don’t want to breakup, how do you think about the long-term hold of Greenway and do you think that there are opportunities to harvest value in that portfolio maybe sometime in the more near-term versus maybe holding it very, very long-time?

Well, we really look at Greenway as a very much of a 20-year project in terms of the redevelopment opportunity and it was a real driver for us looking at it and I think probably distinguish the underwriting which we did. So, we don’t – we are not going in with an expectation that we are going to do a lot of new development right off with that, but we did as you’d expect Brendon just given our history we do in a fairly deep dive into what the development opportunities there are that Colin mentioned in his talk. And it’s not as complicated as it would look. Some of the buildings are relatively small, old or vintage buildings, but also the 2 million square feet that Colin mentioned a fair amount of those buildings 0.5 million square foot first couple of buildings. The pads had really become available just by building additional parking, then freeze up the space that currently is covered with parking for the future powers. And if you look at the cost of that since we didn’t attribute any value to the pads because of making those pads ready on a (FIR) basis are very much in line with what you’d go out and buy a site that like. So, we look at the new development aspect of Greenway more in that 5 to 10 to 15 year perspective, it is a very much part of our thought process in terms of looking at it. Colin, I’ll let you address some of the shorter term facts.

Sure, Brendon, it historically Greenway has held as a single asset. One of the things that really attracts us to Greenway is the optionality and embedded flexibility that’s within the portfolio. We obviously spend a lot of time during our diligence. Directionally, it’s a pretty straightforward simple process. Ultimately, if you did want to breakup Greenway and we could look at harvesting different buildings, I think we’ll go through and try to figure out what our master plan long-term, how we view that. We haven’t made any decisions, but again that kind of built in optionality both on how we work with certain assets whether as to redevelop those, keep as it is. And then also from the leasing perspective, I think that the flexibility has been just a tremendous advantage for Greenway having different buildings in close proximity to offer growth and expansion space in different price points. It really helps Greenway over the years.

Okay, that’s great color. And then just last follow-up from me, Larry, with Greenway and then Post Oak Houston is, I think it’s about 44% of your asset base now. And did I hear you correctly, no increase in G&A and I gather you are bringing on the Crescent folks into the Cousins fold, so are there longer term plans to maybe add some additional staff in Houston over time?

The percentage actually at Houston will be 37%, which will be Houston and Atlanta will be roughly the same in terms of our percentage ownership. And initially what we look forward to having in Houston is there is just a fantastic property management and very experienced leasing team and asset management team that’s been covering not only Houston, but Dallas and Austin and some other markets for Crescent. As you know, Crescent also over the years has been a developer. And so there are certainly development knowledge and expertise and history within the Crescent folks. So, we may also be able to add some development expertise in Texas as well that will be something we will determine a little bit more between now and closing, but the people, the platform, the experience of those people will be extremely beneficial to not just Houston, but just our entire Texas operation.

Sure. Okay, thank you.

Thanks Brendon.

Thank you. We have no further questions at this time. Mr. Gellerstedt, I will turn the call back over to you for any closing remarks.

Well, we very much appreciate everybody being here on short notice and at an early hour. This is something that we obviously are extraordinarily excited about. It’s one of the most compelling opportunities that I have seen in quite a while and we will be hard at work today doing the rest of the equity raise. And we look forward to talking to you all anytime today or in the future. Thanks so much.

Thank you, ladies and gentlemen. That does conclude the conference call for today. We thank you for your participation and ask that you please disconnect all lines. Thank you and have a good day.