Preferred Apartment Communities (APTS) 10 Aug 212021 Q2 Earnings call transcript

Good morning, and welcome to the Preferred Apartment Communities' Second Quarter 2021 Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note that this event is being recorded. I'd now like to turn the conference over to Paul Cullen, Executive Vice President, Investor Relations. ahead. go Please

quarter joining I'll second for of welcome Preferred close. our to financial have yesterday Chief was Thank the share thoughts, after and about XXXX then us, earnings Communities' market turn second review to the quarter an Murphy, a each and report, Joel call. additional initial to Apartment metrics will which had released our moment, you Chief In opportunity and some earnings We Isakson, you Then some return our Financial markets. call over Executive Officer, share Officer, pre-prepared Joel to conclude to capital John remarks. details will hope our

note we'll answer performance be pleased to may uncertainties. remarks, These might made any during Joel's our have. various are involve be future forward-looking everyone of that not guarantees call. statements you Following and to risks statements and questions I'd like

know, and ability which from the pandemic the financial in in our global those included and not statements. we and from and results the actual any forward-looking the include, may COVID-XX filings. These to As our economy on operate, does and SEC of customers, economic markets, mitigate markets the COVID-XX the duty impact arising update to our materially a are operations, but company undertake business the uncertainties differ events to you statements, conditions limited risks forward-looking these not impacts our in

of statement our release discussion as these risks as uncertainties, forward-looking press disclosure filings. a For earnings the other SEC should yesterday's and you and in review well

financial during also for definitions this financial we measures. management and used second reconciliations and on uses other discussion, information basic turn We at that our partnership be call in can filings financial and quarter otherwise XXXX GAAP non-GAAP units, today's are most data A I and operating for period. to terms your over non-GAAP the metrics pacapts.com. that results report Our review be Unless Go the like of other refer SEC these and supplemental ahead, stock press The of to all financial compared weighted release reasons press of our to on directly may website discuss includes measures and Joel. with found to this now based performance. morning would the the common Class results you encourage indicated, share to shares our Joel. average outstanding the per release

everyone, your Communities is very tactical exciting strategic and our Thank our today and for interest thank XXXX appreciate goals. It in our execution against very today. you, solid call our and a we company. in morning, in Apartment performance continued agile Preferred effective for Paul. Good of I'm joining you our time proud

realign we Highwoods CapEx, and so towards our gone transaction, assets that for agreement our higher occurred lower closed could As purposely assets $XXX simplify with capital April us an any in Properties the terms. real have and strategy business we we reported smoother on significant the and the could transaction to investment Armour complemented XX these quality retail a milestone marks and best transaction. strategic wish with. our team high assets. ago, this our our closing to of our first investment and announced to Yards This sub by disposition sheet, the one of our and to transformation estate The beginning from five were we of on Highwoods Highwoods same on the balance which work strategic XX, part and on million. we closing just as business days end, with They withdraw We investments. from realign portfolio multifamily to grocery-anchored not time office building loan pleasure approximately This important that absolute structured for growth

We July our XXth exercised release. press and it's this in have described fully more right,

to that Northwood to And well-respected expect thoughtfully under in another Northwood assets intent capability non-refundable sell that be Investors, limited evidence earnest this portfolio. of money monetize This office over deposit is We sale has we with diligence, except our our completed this completed contract circumstances. and quarter. is remaining to are counterparty later posted time. their an and further due few

milestone rate. with beginning us, at simplify of strategic a we this significant a achieve off alignment the the our of and business, ultimately our flexibility durable XXXX attractive long-term balance stockholders, process For growth to kicked increase continues sheet enhance and

alignment another well-respected counterparty, of for of where and you transaction a we summarize our in our on January our XXXX, we on leading a and manager, and In to we disposition me significant completed of of our savings, structure, In are year, external with today. TPG, housing accomplishments stockholders. November the last simplified of Let update student stronger cost management closed interests internalization $XXX portfolio the entire one to million. approximately

net of realignment were quality one $XXX at accelerate in an are A with capital proceeds on portfolios with $XXX business. from redemption To our initiatives substantial student our one Series and our immediately carefully days stock, majority these we highest in to performance. special approximately what we long-term sale, initiatives transactions rotation, weeks near and November our of governance our complex with strategic A the in pricing. of company resulted of the few XXXX, our another to our not two and excellent and scope strategic during of the solid stockholders steps first-class in Just growth, change have years, propose us housing the of of called These strategic off sector. and multifamily pivot focus to were and Series sheet preferred simplification, of counterparties call approval positioned we on preferred These upon preferred distract the option resulting REIT common balance assets transformative sheet. a majority strong and and amend Sunbelt our And are recommendation meeting, a significant Series allow less stock. core did office to contrary, approved with than believe additional the stockholders to million and substantial reduce five improving simultaneous increased and our These make achieving to hand, to amendments A a that us and planned executed overwhelmingly building operational performance sequential be public our stockholders common built ready both of enhancing through the bylaws redeemed balance our charter, conviction. of later sale in best stock corporate now flexibility to a an the from in our to million of our of With to quickly our moves ago, scale operational allowed

Now let me summarize where are we today.

Our youngest REIT XX,XXX the public portfolio the in industry. unit multifamily is

such portfolio leading market Publix, Teeter grocers, ATB. anchored is Harris Our by and grocery-anchored as Kroger,

Our vibrant is own first-class of performance a of and and by rent nature our markets. growing the our high with at associates, great throughout the team professionals above In multifamily pandemic or top the assets and assets in testament collections short, we to located and operated of Sunbelt peers. quality retail

are aligned, assets benefiting migration both Our multifamily from retail accelerated patterns.

into believe trends will these a future. of discuss they we while couple continue and me foreseeable the Let

and enjoyed growth the costs taxes lower remote from in place and business-friendly has First, solid regulatory of for decades, remote with structures, benefiting for the become regard people Midwest. markets and the as in families living, COVID, seek to and learning of trends Sunbelt space have primarily migration Northeast these and lower drawing people work living In wake patterns, already accepted. have and more continued from more

In top talent nominal among fact, Availability Sunbelt. the more were growth to continues region. areas the Sunbelt XX% the be currently seven workforce According cited approximately with should piece reason grow. research that X Sunbelt metros Dallas-Fort XXX,XXX pre-COVID, millennial for way. the XXXX, XX% often younger population the Sunbelt capture census jobs around and as continue population Worth Clarion to Sunbelt, in in analytics with XXXX CoStar country's XXXX of the the the migrate the to to estimates of metro And larger to with in their leading according an populations of a people, than U.S. is companies to all of bureau live the Partners, May region population markets millennials expected Rise entitled by April report,

demand difficult activity lessens This us markets. seek all their by to in rising construction increased groceries units. shortfall million XX% housing for report tight long-term growth where our for the more a reason estimated consistent major and places markets, they to Sunbelt to Mac, According now housing portfolio the The these our and the see second is Mac sector macro backdrop individuals, live, businesses long-term supports Freddie need their our and for of and their a is shop housing shortage a earlier particularly estimates across that had will to positive country. in families, from because population has research note and and released shortfall reduction XXXX how as out and factor estimate the Freddie product a stating creates the for future, necessity increasingly places that single-family costs major land, deficit is well-documented In May, so updating than XXXX been items. $X.X less with of labor the deficit in markets available solid. construction foreseeable to It

to turning Now portfolio. our

Our operations and steady. remain strong

stress, I are we included, grew against year-over-year we when average XXXX July. quarter detailing was out occupancy a and from also to points of XXXX but seen Year-over-year, the our XXX our have new have point basis This from on and out to alongside good is portfolio is they physical same-store growth positive portfolio in up quite supplemental quarter this basis. but sequentially not of resiliency as the comparison quarter more that our points do quarter the of XX.X%, on the class that favorable second points now. basis not our our was up do point same-store increase NOI want XXX of XXXX. revenue in number, we counterparts, opportunity second of at combination multifamily to multifamily our portfolio, rose multifamily want out our first and quarter the to year-over-year a year-over-year times in XXXX, For X.X%. NOI only up second conditions this our This I grow the acceleration X.X%, same-store NOI only top are rent the relative through that significant disclosure have

for For second growth rent and and respectively. numbers XX.X% And to in X.X%, these we grew quarter, XX.X% renewal the respectively. leases of reported new X.X%, July, and

point XXXX. assets of Our a XX performed grocery-anchored of basis percentage increase first a sequentially also XX.X%, quarter the reporting well, leased retail from

the at properties redevelopment recorded XX.X% excluding quarter. from XX.X% an end the of the sequentially increase portfolio, second points of quarter core first basis Our also XX in to

We our to of rent the continue We sector grocery-anchored our to achievement to in taking solid the portfolio the the and additional momentum encouraged trend our grocery-anchored follow. in in retail from believe promising, leasing that line by is place tailwinds leasing pipeline be portfolio benefit grocery-anchored strong Sunbelt. retail is prime and with

smart results upward guidance revisions with and and Our grocery-anchored in their of later our budgets men second the improved for contributed for work half internal that our not this in and prouder an John and exceeded both their our of the retail could year detail commitment. outlook along multi-family entire to the and company call. our and across will be at women I properties effective

over energy performance to to on growth portfolio transformation but investment. solid has on strategies us our focus our external only this past also strategic execute Importantly, allowed to our capital the not year,

the industries. Savannah, which first economy as in has Savannah, is port and squarely largest Let investment experienced community with a and that before unit invested in well-respected manufacturing, strategy. and aerospace $XX our a the for tourism focused have Group development by originated well we This sponsor million is diverse third Sunbelt Novare with Georgia. And estate our which loan it me a A of as multi-family a investment the of in May country, well highlight, we XXX in Class driven Savannah, know in the Port fits real

the received growth best-in-class Then investment an the another option This of Ellison, in with builds Atlanta we June, of in resulted part fund multifamily a MSA. this XXX our visibility unit growing and investment, estate real to quality of to future dynamic The community acquisition As strategic And stabilization. to a multifamily in community and our following from suburb we've loan as investing purchase a development. our in XXXX originated example approach that pipeline high this portfolio. developers we our to acquired

Worth, Texas, Fort area. a Presidio, in multifamily Worth Alleia in community at Finally, first our Dallas, in subsequent in so end we quarter the XXX acquired July, Metro Fort unit investment

rent This to a the strategic enjoys in-comprise DFW aggregate, a million growth market approximately high-growth As have economic X,XXX represent fits trends, three investments I we within squarely units. of And these is multifamily and to Sunbelt premier Metroplex XXX $XXX that multifamily we shy excellent our assets footprint. the to of our and the transactions of staying In is focus addition demographic, nearly potential Sunbelt earlier, investment just year. in and while we last in on intend Sunbelt to solid units purchased continue true markets. pipeline grow mentioned

over let Now the to John. call me John? turn

Thanks Joe.

our finally, walk quarter FFO, discuss results start second Let's AFFO our more high-level guidance. core detail. updated And we'll with in and then FFO I'll through

everyone $X.XX FFO of primary XXXX generated for the of per XXXX revenues from I the last quarter per in second of million, would share, and sale of to the like student PAC share. our and share $.XX was revenues FFO both AFFO XXX.X $X.XX year-to-date core a of For reason remind basis. to XXXX housing portfolio that decline the quarterly November on per

per year share for accounted several $X.XX the interest each share impact in improvement, believe quarter higher is purchase SFB, improvement. items. per student the per the of Lower of prior termination dividends housing quarters would option have assets. preferred compared most FFO, share of significant second and we the we expense, for almost to X% our to without $X.XX respect our As revenue, grown reflects core lower metric, sale $X.XX $X.X which accounted revenue by With the XXXX share results per noted

compared previously share Finally per share improved offset in was sale of operation our preferred for to for were revenue our AFFO, as the XXXX improvement interest second per property per discussed quarter of improved These property dividends, impacted benefits share the lower the the expense, the and loss housing operations of termination by XXXX for option core per $X.XX purchase $X.XX accounted related our With the $X.XX FFO. student student sale, respect second quarter of lower stock $X.XX by share assets. housing to above. to described results,

growth second company from Joel are closed future transaction occupancy operational per encouraging the our $X.XX were some the and of for sheet in balanced in our has future second the work means growth. of we addition, trends interest already we real be earnings the results estate our forward proceeds our stack, capital This benefited increased to share. multifamily our now balance With half discussed our somewhat, second of accrued impressive In our more of to trends results, expected balance continue experiencing quarter to and rent that portfolio, activity while the shifted investment were XXXX. year-to-date and have half and in growth sheet the with respect numbers. then loan will realign to our our support

would capital quarter, approximately again our approximately is which the a intention goal totaling, of ideally issuance in stock quarterly issuance continued in the basis. this balance result needs stated outstanding million balance stock, with our preferred to net reduce by million. achieved $XX second on preferred We redemptions $XX was to offset intent Our our negative

Our in redemptions redemptions which a results. quarter we our pay when this Again, cash, FFO there cash. deemed in were our dividend settled impacts is

an expect going We deemed see to dividends impact forward. to from continue

of redeemed outstanding have worth A X/XX/XXXX. the Series million year, the approximately of all almost office stock to XX% $XXX as called as our available be the the Beyond of available or the a Series we of Joel housing – from amount student of A $XXX transaction. preferred closing portfolio stock executed using million redemptions called we the or call proceeds of normal to mentioned, rate on of over be Since last preferred

approximately common This quarter, raised stock ATM program. the at of an under $XX.XX average we over also We a program, our million in share. issued just $XX price

and of and at stock preferred continuing our small we of raises capital valuable. to to program The level a common variety significantly going feel cost continue to we ratio. that our and/or efforts a stock we And different when strategically than equity forward in would from fund if rebalance not capital effort variety have important common as benefit market common remember are to of through a a they're ability undertaking. channels also public is is to While even attractively about raise has standpoint the ATM and will particularly our large Raising a priced effort markets added a to good use the raising pays company the we efficient less access offering. fully

to outlook of Let me our for the turn balance XXXX. now

with of today our recent investment our to items capital impact estate of assumptions, real assets, the in our many share $X.XX this to portfolio a of and multifamily From factored expect of some the $X for variables same the revising are store XXXX. in update in Underpinning now these call saw guidance our guidance per discussed. following preferred full of X%. improving and closings all the range we growth stock NOI the in year reflect we've to multi-family We the early to operational in, of core loan X% FFO trends

impact benefit and as loan which office in which option represents acceleration continues The contemplated a originally million XX option difficult in XXX range our significant forward, this will is is material increase loan raising purchase revenue to replace to a new we of investment purchase is the option very our payoffs guidance guidance the to acquisitions are going million to of real in portfolio properties, fewer revenues in of XXXX reversals X% and This XXX repaid, items results to unchanged purchase being from to XXXX. of offset CECL termination result of results sale properties range previous with will from investments to have of of growth as XXXX. to portfolio opportunities multi-family the termination the short-term. of acceleration investment our a helping one-time real million, also which that and our This detriment X%, today. estate in from XXX originations, the of accelerating loan We’re in revenue the a in include prior unchanged estate combination acquisition portfolio multi-family be million previous These the dilution the have reserve guidance. in

more the strategically the be focused from dilution as we fully impact. and as accretively proceeds on in but transaction to will the expect are that We possible office XXXX, deploying felt limit dilutive

the addition capital, redeployment reflects also In our the markets in and portfolio offset some and dilution thesis, to of strength transaction. the organic of the from the office growth will our our of investment

We near-term preferred earnings like elimination benefit of which emphasize does the our yielding also from for with of portfolio, in term. have office call forward to on going near strategy office associated I stock opportunities. the impact portfolio the be apex higher now of a foundational our would meeting the for utilized future the can sale on

us strength guidance initial the is and interesting driving position. above year. put the the our results property performance in of at Clearly operating an portfolio operations its of Our start the

will way our net we already the as result work be and through our monitoring budget XXXX items We their process these of impact aggregate closely underway.

above, loan the well has and to interruptions. current. This we initially California addition loan large in continues investment mentioned through by affected performed to the the turmoil very have supply pandemic was chain and items shutdowns that a In be

construction and as maturities this loan against the loan the lease-up delays we completion created timing, pandemic, of asset. the and concern During around valuation some the reserved

pandemic well to come has report asset that pleased lease-up very are We its continued has and improve. to the through the

versus borrowers XXXX, XXXX. loans maturity off Our the considering of quarter paying loan in in now one the

of Our portfolio exacerbating in dilution XXXX XXXX earnings the and impact office pulling the XXXX from expected further in XXXX. would payoff the effect have into

guidance We to this Joel? when final as, now the will appropriate. Joel I'd his and for update turn call is it becomes like to thoughts.

description. for Thank that you, John great

like there to leave Before you. with we thoughts began five I'd Q&A are

growth a created our enhancing improving and stockholders. First, our sustained focused to portfolio, more alignment to capital long-term facilitate we've access with

of shortage great and in and visibility Second, jobs into the housing, growing future. Sunbelt structural provides are markets particularly our the quality in acute population in the

the Fourth, capability nine and sheet enhanced all ever positioned flexibility executing ability organic we in provide strategy multifamily our our our type deemed accretive complex into last year the months, Sunbelt $XXX and the next greater balance demonstrated for focus those we we're transformative have capital Series transactions and to course, beyond. we sale, for to the growth. balance in control our to Third, shares we which multi-pronged of your and updated do opportunities and believe growth, maintaining develop million while in through access you markets since will of year. product over A advance housing student by desire to strategies on strategies capital. source the and We'll we a and grow appreciate operational metrics Fifth, interest and a always And this as keep then key of progress PAC. preferred

turn Paul? over I'll to call Now Paul. the back

go Joel. Q&A you, our At ahead point this up and session. Thank we'll open for

Lewis first with from come Michael [Operator Instructions] question Securities. Our Please ahead. go Truist will

Great. far Thank increase guidance. the I swallow here in that about this Or same-store to going in as over to tenants the by the XX% the have as the increases it there anything that is as to surprise else change start in the simple go prompted was to there of and from the big rent months X% amount NOI biggest able X% as on you to surprise three X%? last What July? Is to been same-store X% asking wanted you. guidance?

were a Listen, look How have seeing starting We're This doing? in kind significant that when been went, gosh, we It modify probably wasn't was Yes, but happened. of now thank just you me our just revised at last may sitting say when get we bit to just you, were, It wasn't all. to that oh place let like trends. an Joel. just that, on surprise. my what and have guidance. we you add John little Michael. It are you

well time. the is on lease said Sunbelt, our based of in what in the out as articulated new we and cap renewals. we SFD, quarter lot new in as numbers And in third as on I particularly there places, our SFD, was my as July, of a those as which we comments, it's on our replacement saw significant and was in So seeing XX.X% leases. at said really in you're on And in guidance acceleration it that

So it was of those and operators a – how trends why believe guidance. management raised acceleration pull which and rapid our we we believes can is our forward,

getting have of consistent about And Okay, and you a that's than I wanted the there's different for cap multifamily. thanks. we cap portfolio ask that? I Armour is kind two-parter rate in on your Obviously, are cap – did rate, rates the pretty low. or Yards lot to Highwoods those competition rate I assume it then cap a should for with of but markets second, acquisition materially assume

percent The we things. be really, estate out, I about tone And pipeline We were it's in we see, come they and There's gives or XXX% seeing what And in So you're we that partners. going tax let be those it listen, think months. just to level our largely we've also It cap mean, I perspectives. about me is growth, real try always to out rates but ability Ellison, the but with is component doubt, to and is could report growth anybody think, create take it And minus leased to plus to up wasn't assets I understand when than X six up do rates property good, saw those with residents make – would for feel exposure, when just the what I no rate well, marrying maybe compression. us just but its to came no cap of they our trying competitive, more we're something environment and from yes, the certainly right. acquisitions just two. debt. the we attractive don't reasons we a key Michael, lease. that. so manage wisely There's on ability the publicly, rent rent the and these saying they competitive doubt our think – been think

was that Highwoods and portfolio that they’re is but far people, the creative I’d the I'll think I understand As office about strategy. probably we'll but say a ahead portfolio, that saying, all talk as after thing transaction. closes The what it, goes the part when without Armour that it quarter. really and go Yards, of was their that terrific Armour Yards And outside They say, terrific. But did, what inside to others price, did. certain strategy the willing at they're but them, the that were – transaction we it our but with think they acquire – to a ability market of knew we you place that to sell which we be it that would “our to more. and pretty good was a will, if still wanted had right, downside”, for if we that In

it saying exercised of and if Northwood, that weren't counterparty terrific Highwoods. their have we the better of economics what right to especially So I had is which inside would sell to transaction without inside it probably goes this not strategy think we that

can. was maybe understand in revenue? I'm And And what options, then to just guidance what the that in versus makes what's headwind relative going sense. versus of termination is XXXX the previously? trying assumption guys I That Did if one be. share terms earnings purchase more what this just to is you

process Hey, specifically because We John. Michael, is in reported the some we from obviously and of not quarter that. did share that this certainly is that

it. is why of on. And about have the cautious reasons that's visibility that of we which been much And just one we've as some don't pipeline,

in more we don't So guidance. put what than any have the

Okay.

– So maker? in $X, this in to formulating you that termination of $X.XX you can't this can't share much how

No.

Thank right. All you. Okay.

Michael. Thanks,

Jason come from go will question Trading. ahead. next with Stewart Jones Our Please

think does structure return I taking and of structure in answered. capital mostly impact of the about capital optimized thoughts should those going given lower maybe the that shareholders structure? forward capital, the And the changes and your I the the beyond. can as for terms capital you And how guess, Congratulations you question. acquisition in been think Thanks questions in some on strategy? the one way cost the share question Okay. accounting on XQ progress strategy, have

to comments you. All Jason, from right. thanks Good about for your the Appreciate the quarter. interest. Hey hear

sure let make I want me Let understand acquisition really going our talking I to I the answer, before I strategy exactly really question me start about make sure – forward. I – know you’re to

you don’t sure I'm make I it. why from pretty hit articulate so sure I'll that. Just on that,

forward? how think capital it's you about cost be think as Well, you it's you've strategically, what could you coming acquisitions, a cost that not And about guess, lower when the about going impact I the capital and the down. If quantify that should of would about with you think of retail How be be would acquisitions does using do where done if structure, multifamily think great? way just grocery great. capital you

That's what thought. I it. Got

certainly listen, at So three look we so them primary we positive these ways. acquisitions, at in these look changes, with

short-term, right, then accretive; capital, And you're have period. at look we First, of accretive, transactions as and you whole long-term your mid-term, cost overall right. work to improved, is reduce over your the accretive ability

higher high CapEx, space about definitely our in the multifamily rotation and which multifamily What as and a office, particular in obviously out we a into is as So grocery be low which into before growth in you've would lower like well. talked the the that's of helpful CapEx rotating into about to space spoke growth.

the is at deals and that, year both they we you at per an out really of the price that at we replacement obviously to at retail post-mortem that that a you the we've look said, said, an looking done, per loved which much There analysis kind growth we we'll of we've horizon have that the at And We over the and multifamily funny getting, it probably other the up. basis look was little that that We like market did gets look want to kind of rotated it of rents that. price our look life, it. to altitude. IRR and over or hit relate to a we we as us unit the of So sold limited did on just that at the us per not that relative we they're into think based deals alone, time? works, really on just one on the because just out prong portfolio We'll felt second the pound we weren't just do how And a but IRR because well, liked and how other that the IRR price and mezz it pound. we a to asset We're look look place see a but do what don't this the per felt too buyer numbers matches costs. on cost of is unit. on, your,

it ways, So point make to but at on the that yes. real done sheet, balance it make the question we acquisition? look three certainly, answer, the helpful those of does was we’ve improvements To your accretive

color. appreciate the you Okay. Thank for that. I

question second that second felt I I part to feel almost if like it Jason, there’s part were to that missed. us. back sure I Jason. you they there was a just I question. to of to was, I a going come like – wasn't your But back make wanted

Yes, sir. go. to you. Thank Good

Securities. go Gaurav with next National question come will ahead. Please Our Mehta from

morning. Yes. Good

acquired on off your what's XXXX. have loans and investments, talked more other color for loans? provide the properties on payoffs been we payoffs First about Can would in loan you of question driving those acceleration that early acquiring some certain

maybe thoughts, going it. in thing He's hit this, the Yes, John, let sure. also I'm some me think and then I got just is overall will market. biggest the talk what's on Gaurav, on

the history got you’ve at got of it the lease that typically XX they We that investment you've mean to which months. time, build have during loans, long might and look XX to up. estate And be – to loans they're out, all stay doesn't and how if you real those that kind of

lease mentioned, not I as full to to these go thing Ellison The six with going on what's months. saying, these so can As compression, based developers are they're went – up they're appreciate rate XXX% are you in holders, on cap long-term market. wanting to Well,

underwrite, have it fact fact that in the that we we made in these been. in the So multi properties metrics Sunbelt and to space were knew I we going when operational turns combination be the they the that particularly and out think the good and the assets of loans these it's

would market else? probably the So they've do you but primary anything say that's have I reason, faster. to come John,

leasing pre-stabilization. about bringing think been how on were been to things Gaurav faster, really the properties market Joel's of to them competitive developers that's on One also has piggyback market the is And up addition to comments, in based the accepted.

And so basis, faster when coming decent here. you leasing and that adds seeing to the that acceleration up combine out a on stabilized up we're pretty

you're actual actually a mezz are that when to a sitting people leased well, ago. of, that just are we that exactly pre-stabilization, big that I John's visibility that liked, we're coming great taking normally once say once hopefully And our we piece have sense have something And really does than in, of day, the stabilization? week, out at properties taking referenced is X lease better you And out up just towards that, before it. percent you'd right, the visibility there Well, stabilization. risk really particularly second and at was, a in point more a you manager okay, leases the a Yes.

great. your question sheet. second balance then And Okay, on

you issuance expect You forward? provide And pressure be sort we fund that common earlier that the in you quarter. expect color call in issuance, expecting I that forward. some struggled that stock have going Should second maybe to negative using you wouldn't more looking think do on I negative think stock maybe of said negative fund to up the how

Gaurav. Yes, thanks,

mean, fund of around, the company's stock moves we time. stock and redemptions I most ability whatever – the pace take And down. the redemptions cash we the common to have obviously, we beneficial or is and option. strategically just and goes So with that's up at financially with

or use stock. variables we a it's So cash to control. That lot predict depends don't difficult of on we'll that whether

you. Thank Okay.

good Thank to you Gaurav. you. Always talk

from Oxford Barry Next come will question with go Please Colliers. ahead.

Thanks look changed Great. new you're market on number far the And sort or number mez what inventory John looking going the the two, as just again, one. availability investments, mez financing? make at Joel forward, as like when guys. of mez to the returns is on touching have the

I thanks piece while recently discounts five kind significantly. evolved if a making and bit But they terms spot. sure to Hey terms, certainly the purchase for a option actual the ahead of not have were equity good Barry, would changed, equity, materially the important the of about. not you, to those less in from there bounce hear material rate, pay nature, interest how last also in and might say, that come good keeping there's little It's We've narrower, over a years little as your over are a bit, been developer ourselves the there that's themselves, rate to accrued of around, here us of here good a us. time, that.

definitely and done a developer, actually business and terrific that deals our Terwilliger that's getting the So we portfolio. I for Jacksonville it. who developers. to well deep a do did Isakson mez long Sherman and got that goal, that tactical we that multifamily we called and this developed on know Newport, a that pipeline. runs along. a one And and with in goal group They all you, John Jim expand group the But we ones The good Pappas Menlo known year. a of we've group as have you the one then and property were then, hustling. other given catalyst, acquired Jeff strategic say there, have that far would great stated folks feel others to We established we time the guidance. terrific They're for to a as there and cross-win to done we've developers who's about are second then out what with guys guidance multiple inventory, have always Novare do in love our overall the the I'll that We’ve We of region. with Group, tell we Borders, had those, best this still Oxford talking, out the

these it. So multifamily. to we expanding we out the We understand, some it's road opportunities and to getting understand developers, but they like what getting structure, like the out choose it We of most ebbs and there's may developers, people first-class a new telling on and like those with be do but leasing. us flows, partner these developers get as ones to because understand that of not

a moving it's but us forward to pipeline filling thing for So we're keep optimistic, is that big out.

Go color. that for Thanks ahead. Thanks. Perfect.

is held really it's lot we've option a is, relatively the purchase purchase rate Joel's I think the bit, To as The we've a that competition pay but And been pressure. There's – little a that's seen constant. where in discount. there been it I changes standpoint, where bounced from seen relatively been think that’s Everything point is the I else Joel structure stable. mentioned place biggest most certainly everything's of and discount market. option pressure. around the been mean, is

on Okay. Great, color that. I appreciate the

type Just but get trying to here? be when guys see great a you of to backfill, of sense terms getting, that will what that's you

to Barry, TDK. mention one want group that I also is

a only of the And did, do is One contractor, that's roots. general they on we the on jumped TDK. see not a about okay a go Nashville them mez, was properties, once of as up that also the actually the what counterparty things direct to as like develop out they're terrific COVID in little bit it was to we to result get battle

them chill just, stuff wouldn't were a were I it stuff chain, integration just they seen when losing kind that guys disruption, just, very were so about the liked all it, and their I minds vertical that, that. call relaxed like And lumber everybody liked supply that before they this understood and about prices, TDK all of of that we because but of they We it. They'd developer. kind mean,

Perfect.

of Now makes Appreciate it. sense. all that

Please from The come next with JMP question ahead. Securities. go will Aaron Hecht

going it retail is Obviously bit you think the thanks your couple for there's forward? would going demand? quarters you as acceleration And point down do assets, an pretty looked my a in hit. how trend year-over-year, of On occupancy guys, be but the describe last question. then stabilized taking Hey in to inflection

I do think. Yeah,

a that what seeing said retail forward as I loss that to been it's look are spot. look markets look those characterize the their at you least. that percentage, more good too. momentum view sequential to very you that's getting everybody's you peers if out that, And where all said there, occupancy think and in you important we'd what improvement. We leasing if in are year-over-year, like way Each is to we the historically we've that is I trend line, little it, Aaron.

adding a kind low-base, working new we're So those renewed. keeping feel we're them deals, in of off like

to some negative the The didn't we them rest that's us lot did but may what operators. through have hangers other and, way the a be rent, we the the on thing the replace of while better people better is that's look interesting us weren't it material paid of that confidence as we And is, with that pipeline terrific on feel feel and now of of kind that now might've see a the impacts year. had We do goes rent. at that kind to maybe we operators

some up So more states spots you're are continuing type growth in even these of of interested months seeing showing retail footage in and going the specialty the within assume couple that over tenants type forward, I are tenants? that potential centers, number smaller your last square

No.

XX,XXX trenches yeah, deal beauties foot that's But in of kind the foot and anchored. always square we – one do the You're these as X,XXX right. time to pressure hand-to-hand takes This is a as it this of combat portfolio deal. you its of much actually small square and effort us on call It the deals. might've

comes revenue So the out of anchor and you've chunk got the that. big a of big

earlier to So smaller I the deals, answer Aaron, the kind of the leg largely to are about that yeah, was talking context in back stool question. goes of this but Jason's these

the looked per was on pound us. that also We price acquired big marker that for assets we a in XX retail we historically when bought the

our that meant is what relatively So is structure low. that rent

a were that's is And math Intent, assets. it somebody and don't off is $XX they is portfolio quarter they had towing November So the in the question than Back of to found only idea, really feel, people XX retail, last out sign together a rest was what they ground, at it. – of prudent remembrance. but good to grow showing got a just the really off that fact head other it's the our happening plan, what have the little spread sign easier But ain't do up more lot in just first LOI, of figure is to people later. kind Sunbelt people, seeing, of spread that but December of build things to of happened location, of their it year, in now what $XX, to that days those, rent. a really Florida up walk-in an $XX sign What they sign you they put kind out, open lease, an to a lease, maybe your Georgia markets. got is do and and rent business do we're to be the of in are we the to a move it spend and through then Letter do you And are, out they have sticking hire that's and that the

hits. So be these more and it's a like, But it. definitely showing good up thing centers. shopping are with attitude of a before income they're good are little wow, the showing like a people to up part trailing bit I'd of

there of sounded do redevelopment, to there road, of if property Is kind like And any to is Is within we had profile types before ready more, be that return it talked your you've I centers. Yeah. And about if one the update any potential that further on more? retail different you'd share? the down potential? may, something is, into kind looked that

We've this the to like through go got really position be they're to a that one point this, we of got their like used when watching, play game a event bring COVID, comfortable to willing every to. to And everybody's really you that not everybody's or an day. with definite, look of us. in things I've but forward that, Yeah, got loved they sharing as is the say emphasis will NFL,

in because multifamily help but how talked historically And I definitely think that say, shape. is sharing And other? it, off silo, that business talented forward point retail and leaders things their here of things on we those but a can ready. one just they this executing taking is of own Well diligence, is now Not rarely really they meet, of well. talented we together? due things we've I've got to strategies incredibly look their group, yet emphasis. about we discuss they're own incredibly seen do how were only this the and each group best That can as encouraging the

the thoughts Appreciate guys. Thank you.

Thanks Aaron.

any this and session. conclude for conference will like turn Cullen question-and-answer Paul over closing to Ladies I'd back gentlemen, to our the remarks.

for Communities. morning your and this in us Preferred joining for interest you Thank Apartment

to your free to you we you have reach to Thank of any week. rest want feel you. wish If follow-up good and a out questions, us,

now you today's The presentation. concluded. for conference attending Thank has

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