Howard Hughes (HHH) 9 May 232023 Q1 Earnings call transcript

Good morning, and welcome to The Howard Hughes Corporation's First Quarter 2023 Earnings Call. [Operator Instructions]

I'd now like to turn the conference over to Eric Holcomb, Senior Vice President of Investor Relations. Please go ahead, Sir.

Good morning, and welcome to The Howard Hughes Corporation's first quarter 2023 earnings call. David Chief Executive Striph, Financial Operations. are President; Jay Head today Olea, Carlos Officer me O'Reilly, Officer; Chief Cross, of With and Dave

we today earnings first financial financial quarter you in press release of the to where today Before most to are non-GAAP supplemental measures. present Certain measures the can relation made forward-looking supplemental earnings company's statements would package. package our discuss website, GAAP reconciliations The you discussed be our will our and howardhughes.com, direct both download within and of I begin, directly tense statements laws. the their securities release that are that to that in not like meaning comparable or federal the expectations include

believes see in these Although disclaimer forward-looking cause based SEC could give that statements are we reflected in that factors Please reasonable that in filings no forward-looking material and first assurance earnings the our for between achieved. forward-looking the actual expectations upon factors results. be differences and press such assumptions, release can quarter statements the statement risk our will the expectations company

unless not to are duty update forward-looking by We any law. statements under required

David the turn over that, will I With now to O'Reilly. our call CEO,

a financial development Q&A. by finally, in Thank and with On and recap morning, first Seaport. for of our results cover who Ward Communities Planned will our you, our our quarter segment our going everyone call. will assets, Master Striph projects review highlights start before Eric. Carlos Jay, our cover the operating Good will update Dave followed quarter Village call am earnings and to welcome to today, the I and

with to asset a our growth. results our the which perform I year-over-year MPC start unique to that results prove first Considering reporting both and report to am the favorable portfolio of numerous ability latter the further our its continue cycles. market quarter headwinds segments financial the pleased in assets, of market part had operating exemplify throughout XXXX, year, with strong various resiliency to of

EBT continued sale aided and strong by the to Bridgeland. XXX in land commercial builder prior residential year, MPC per Compared our increased acre, acre price in participation a price X%, sizable strength

operating delivered increase, year-over-year of when a Our the dispositions. million, of $XX asset NOI assets X% impact excluding

At drew we the equity Ward at Seaport, to units contracted the losses of days XX is seven improved closed seasonality. five Building significantly and now Village, Tin on deficiencies reduced and week, despite sell which open the a sale homes and winter

a rising with positive home and new to our sentiment fourth the sales quarter. During the in shift we buyer experienced home MPCs quarter, XXX% compared XXXX

sales, While translate into did not land residential going for home immediately which forward. acreage, sales this builder it points favorably the higher interest land to did improve new

of reduction, to improvement. $XX price MPC which per EBT, we modest $XXX,XXX. fewer a $XX million our performance X% sales, reflected growth impacted sold. which Looking continued by delivered This acre, $X land acres rose totaled to million, segment, year-over-year primarily million at was MPC a residential in due residential XX%

over carried into home MPCs. value new our also of in rising acreage, sales The residential our

revenue quarter, the payment participation the new in reduction remains a receive we on implied the million, from the $XX first despite home the rose, X% are based homes new at builder increase decline of value our value. implied price new sold, strong year-over-year has land As sales. When X% value increased. a the In a homes builder also in land the participation

with XX quarter Bridgeland delivered another region, than average acre. acres at Houston more sold residential of $XXX,XXX our an price excellent In per

price continued in of $XX million $XX quarter. sale, land Brisbane the XXX million revenue. of EBT which also builder strong on generated over significant a participation, We closed With acre reported nearly commercial

Woodlands, of which Woodland price $XXX,XXX million in a Hills, five Lake sell to continued of per quarter. $X.X of per In In at the we nearly revenue the only Woodlands, generated lots acres at Isle sold million acre. These the record however, lots $XX we on sold, custom land Aria acre. at were

reported Much the of another acres phase quarter. million, XX custom million summit, custom which Turning and for we earnings land of in the strong selling sites. EBT $XX to of XX price in $XX home results at totalling commence of Summerland, we the were lots participation, two, the builder these includes first

EBT a meaningful this expect the development We phase of Summerlin's as progresses. year impact new have will on

infrastructure mass Teravalis in newest West thousand to Phoenix Finally, to groundwork and lots. contract Valley, installing needed the our of first continue grading Floreo, and community residential the for we lay

contracted expect to the continue year. We of half in these be second lots the to

the Looking at and Bridgeland, which compared fourth to more previously a the XXX% XXX% sequential of mentioned, we improvement new attributable which increase sharp to home XXX selling quarter, homes. sold experienced doubled Summerland, recovery homes in we experienced was number fourth quarter. The a of sales, the total as than

as homeowners historically attributed rates as attracting sell their These a new rates. mortgage low contributing to buyers. resale available mortgage reluctant asset, well incentives, with be can homes builder biggest stabilizing many increases of home to is Also home lack their

available according Association makes to the of of US norms home a inventory. more than the Builders, the Home National bit to new currently in up about evidence, third of historical This XX%. one As construction little the compares

depleted to our the in in turn XX% spec buyers quarter. inventories fourth quarter cancellations new cancellations and from home declined. alone, to MPCs have quickly XX% the first With significantly to forced many have declined home In construction,

combined in increased. starts home of When purchases a negotiations acres March, have new decline year-over-year residential for with in XX% new

meet residential improved demand. will purchase to builders the As to need a result, the home in lots new anticipate sustained coming as land sales quarters we

Building sales achieved day seasonality. the the operations foot seven per week at traffic to Seaport, throughout over quarter, Shifting strong Tin despite first winter with normal the we the in

remain the in and the $X.X Although considerable quarters. that increased elevated from improved path loss continue We confident sequentially financial equity to are total expenses and joint improvement million. we million on coming venture by costs, experience a anticipate this losses startup employee we $X.X for of right

the Overall first growth million XX% the for we've Seaport, $XX in year-over-year reported generating in revenue quarter, sales.

Tin million, improved $X.X the joint primarily Building, unconsolidated from the losses to which relates of million. $X.X NOI losses ventures Seaport, Excluding

the that, review assets. to of hand David over the With performance Striph operating our I'll call to

Thank the you, strong In year on morning. David. assets million we operating segment, delivering a total Good started $XX note, our of NOI.

Excluding the NOI assets in increased divested XXXX, in year-over-year growth we meaningful multi-family total retail and that our retail with portfolios. office, X%

in leasing continued overall types. experienced also portfolio sequential of favorable percentages We three leasing with core improvement our the each in across momentum property

quarter significant XXXX million by million. strong the some at offset most year-over-year occupancy expirations increased generated assets and year-over-year at tenant The recoveries and first improvement NOI seen This was XX% rent primarily in several of well $XX which of in woodlands. activity, lease in in lower improvement various Downtown our a These office $X.X tenant The increases lease result of resulted portfolio, were One or was that abatement, bankruptcy the expirations Columbia. at as Hughes as Landing properties partially a Woodlands, reflected in

quarter, square in and outperform expanded XXX,XXX Summerland. square the we new office XX,XXX or feet Downtown to XX,XXX XX,XXX the in continued During market, feet, Woodlands, square Columbia leases; in square feet feet executing the including totalling approximately

quality and subside anytime environments to highly leasing strong flight do seeking heightened their demand amenitized seeing not a for soon. the from exemplifies see employees, we This companies, performance to we are trend clearly expect

a was leased. year. was and retail, XX% increase NOI base Downtown first the $XX improvement quarter tenant This the Summerland, related stronger sales to finished reflecting compared million In XX% and perform to growth prior which well continued primarily retail to in quarter a exceptionally

tenant increased and occupancy improved Woodlands Ward recoveries experienced also and Village. We in the

X% compared At quarter sequential year retail stabilized XX% and to improvement. increase leased, the prior a our end, portfolio a representing X% was

a Our driven also by the This XX% of NOI XXXX place insurance delivering rent growth. was in Houston result of in increased revenue X% primarily rental as portfolio million performed quarter or well recoveries the related multi-family a growth freeze the well in as region, year-over-year. $XX to as

our Downtown Marlow with improvements by stages finished are multi-family Bridgeland in Downtown leased sequential early XX% partially Starling leased. expected Summerland initial Overall, These losses Marlow Starling Columbia. experienced Both in XX% strong properties XX% already quarter Columbia, and our the leased lease-up. multi-family with at of from which latest in gains at assets were developments, have Bridgeland and and stabilized demand the offset

share in first the quarter. our reduction unconsolidated in Summerland in investment our which from almost million of the XX% of was result the ventures lower Hospital, NOI distributions $X from entirely totaled declined This Finally, cash quarter. first annual

call will over the our I turn now Cross. Jay to President,

its welcome progress Thanks family In Summerlin, residence located good and on our we to first Bridgeland, everyone. multifamily for expected late a Tanager construction, slated next is in first in downtown quarter. development good XXX-unit Wingspan, in make the under year. Echo, completed which projects be our to which including quarter, Dave, is to complex continue single rent the morning, first

Summerland with building of XX,XXX square Lake square downtown more construction meaningful office, to of completed stabilized in yield cost Columbia, $XX XXXX office Together, office South expected an expected and story NOI a these XXXX. a be late foot four South started three complex, which medical, are projects in to XXX,XXX approximately generate medical foot in on than X%. million

during to continue Seaport, more becomes June, following court work you site information term. an the XXX allowed its we XXXX work Water appellate hearing apprised Street interim pending We'll full at order, at March, resumed keep which Looking remediation for during a as available.

celebrated the a during pre-sold on the Victoria construction Place Ulana, condo XX% off and we're of Place is Together Village, the projects the the Ward first we have making XXX% Ward construction underway. late Ulana XX% with started now topping we construction pre-sold; Park Village, At Park where pre-sold. recently Victoria progress XXXX three Village, in tower. and of which which commenced Ward great quarter,

Kō'ula, Condo Ulana quarter units steady a pre combined XX the Park with the were contracted in sales and Ward Village. at

already $X.X quarter of after projects of months four is yet of not and XXXX between These was XXXX. expected construction generate end future revenue just are billion started pre-sales. combined pre-sold XX% which nearly Kō'ula, six As to

closed sold remaining, At XX was on $X Kō'ula was with Kō'ula, the end During of units the remaining. of units four the just revenue XX we XX% quarter, 'A'ali'i million. also sold combined and quarter, at and 'A'ali'i XX% unit of at units generating the one with sale

year first Village, with residences. our the year, XXXX. project is early This late announced plans XXX in this which encompass we our the next quarter, XXth will project expected in currently in Ward completion pre-sales develop commence Finally, to condo to Launiu,

like CFO, our overview to I financial now our high a hand Carlos call results. over provide the Olea, would who level of to

MPCs you, participation aided Thank first In morning, produced price residential the price and our of EBT commercial builder acre, and everyone. million sales. land per $XX good strong quarter, Jay, by

assets retail NOI growth Our $XX year-over-year delivered multi-family. with million in and office, of operating

this position, represented a this Excluding increase. X% year-over-year

of revenue condo units, we condo generated margins. reported million At $X gross XX% five we which million up some At XX% close Ward Seaport, Village, at of year-over-year. $XX the revenue

the As and week. continued but generate to improvement expected, losses, Tin days in the anticipate improved spring with fourth continues $X.X summer marketplace now they compared open the million the equity a Building to quarter, ahead. months seven We

Lastly, $XX we of reported million. cash G&A

and remain as guidance Given year full we these our positive outlined in release. quarter the confident expectations reiterate earnings results, our XXXX for first full about year the

the million our end development pipeline. Shifting well South before which to we the projects to sheet, quarter, pending current equity contribution us balance of first deploy our million with $XX was ended positioned At office. fund construction million for the $XXX cash, the leaves into Summerlin quarter to of financing the the a remaining is $XXX anticipated capital

the million of approximately later. due XXXX debt end perspective, $XXX had and or maturities billion only XXXX with From outstanding we a XX% quarter the of in $X.X through at

on is Additionally, significantly risk. Village. a interest With for to financing respect our of mitigates million our new debt, Ulana either in Ward to in construction XXX% closed the fixed, one swapped rate we new quarter, or $XXX a which capped debt rate, fixed loan

closing With the to call for over now back I to would like that, David turn remarks.

but And much, before calendars on Day, in to information be please open for lines the More coming which in and Thank York September your weeks coming you I we of Wednesday, next Q&A, us. announce our mark Carlos. will want the date held the join months, will to X. Investor New up so be

final a thoughts. few just Now

intact. year started within particularly remains the guidance solid on we performance, assets full segments. With First, this our MPC and footing, financial operating our year

improved we availability, new lot shrinking demand With throughout in growth ramp home Next, limited are sentiment and for residential segment. out inventory a and for to see positive the land expect MPC new sales homebuilder as our homes, up sales we increasing corresponding spec year. significant go

highest continue achieve to advance the a this allocate finally, And we risk-adjusted laser pipeline, are to appropriately development our we to focus our capital ensure with but returns. we doing

of Howard future All for and what well of Hughes, for ahead. we bodes lies this the are excited

Operator, line portion let's call. you that, our with Q&A open question? Now start please the first for the can the of

our which this Paolone with will will [Operator come first take we time, JPMorgan. Anthony Instructions] At from question,

land you that talk to My corporate well. what's at what quarter area? and those sites, first to and I commercial if sort fourth of happen or does Bridgeland, the some, the sale going question relates in to to the also Can just relocation overall think, likely as did any you those sort be of are to

by Bridgeland. that I and will question. to terms Tony, think were X help Bridgeland within sold is love distribution that a site want developing And would an we modestly There the those large-scale that center. is you. recently. we've sites to close job adjacent Thank One that sold landowner that in creation industrial a of I live in

bound corporate from information the that, going to of top. think that that in meaningful it, but is you is believe is me, tremendous user catalyst. we're The a other once be activity that and talk tell But confidentiality a about jobs to speaking more who user terms and meaningful that's location beyond now it we bring I'm going I'd right love to to able be I'll is. side by to a that,

like that will Okay. this ahead fairly this soon? something is on Is start years or move built something to start Or out? get to

we're and No. they've process, that their they expect This need done this getting entitlement and final design start year. their work they'll was they're near-term will construction a -- and and through approval I that hopeful

second XQ, Phoenix. It from then acreage. like changes West some question looked lots to I pricing those mean on pretty and on changed And dramatically there's you Okay. the

wondering what's Just happening there.

absolutely. Yes,

for and way and spaces. lots was planning right open retention. residential we're $XXX,XXX finalize per per and we and $XXX,XXX and basically And laying which parks, our mapping with the model, land, price and non-saleable of So land Teravalis parks we included streets acre which reported, that previously original land for Foreo as done out water

lots revising now includes for account per the only our which to be to reported sold to We're residential net salable acre price land, in the builders calculation. the

these amount in think factor to relative can modest I Is the there, just Another builders. but sell acres think gone where we that's factors. of we other it's to the up of $XXX,XXX net even gross modestly last in acreage. prices year we are $XXX,XXX the relative the acres, fourth despite salable new and saw headwinds at the to representative quarter. These the not And

Okay.

for kind of adjusting real simplistically, change just or up change so the that, And like just no down? all was

our would modestly, difference The I non-saleable is the say of what the out expectation couple pay up that percent majority driven acres. of a taking would modestly higher. change in by kind of very of homebuilders is

Okay. quarter. a In portfolio, of Got did it. one. you last the bit just And office the leasing in then

rest what still to expirations kind the of this trying trend think do rest occupancy Just offset? Does the Or the occupancy up? of year? or through year. move-outs Or to of office happens

in that our I that some improvement. assets positive look, in specifically at some X,XXX else in and continue property Look, Well, of our here new crystal see think Woodlands trophy we'll Tony. my of very assets optimistic And we'll I'm going you're test good ball, and goes I Colombia to see the feel Summerlin increases. that as positive the everything if in expected, better to

away been steps these because and the of from better. would we several Woodlands year, part that's With negative that tenant it's that back the to bankruptcy X was had something a bankruptcy, predict on it forward saw despite quarters, results impact much a a here that. results have we decent-sized X default of have last very or past difficult positive would And the that over step or in bankruptcy kind said, what other

will next Sandler. come with our Alexander question from Goldfarb Piper And

to on the housing, city are a One, you more hear that good good Yes. be continuing XXX, certainly way. hopefully, progress that goes would guys which right needs. definitely It of the addition

mortgages. point the given the But So builders homebuilders legacy surprise that adjusting David, are to general. like are seeing that down the build product embedded literally home price that work? that the you Not is are make question on mortgages they my are in given sales a curious, up, existing

of have the there just enough incentive really but customer. basically an of offering you the are today? same of Or the mortgages; higher is it reality from that and offering product incentives such they're just more that it's still that change builders buyers there's and building builders accepting buyers accepting of two, they're the they that offering to have And are the two, that is the combination don't what to

buyer the we've increase tell lot seen a mortgage are like upgrades What haven't seen to view rates. Alex. in builders would that of premiums going altogether. a product of I shrinking Yes. you have away higher without seen some doubt those the shift the buying is What acceptance rates dramatic that existed premiums homes, we before I a are that or is premiums, in the

are The offering incentives spur are helping that demand. the homebuilders

And sometimes have, situation. three the the buydowns in those mortgage, one, or and reluctantly, rate even lower homebuilder the term builders even the on prices albeit depending instances, certain And are homes. the of of for

I in over production XX incredibly inventory it's the the past only and, new as positive, the homes those all, in town has therefore, are especially think dried up, up. that gobbled getting all are game days resale

that inventory. down up close right to in The to that are that's fourth up meaningful in due their standing our in quarter that buyer therefore, pretty decrease fell cancellation inventory a the And specs. wants rate the away, that built so those coming spec high gobbled dramatically to homebuilders

quarter good in what and fourth the has guidance that in and with Summerlin some our a intact leaving in a superpads we'll pretty a we and we're land despite challenging rebound here interest our numbers, first that modest been great hit think and our feel seen And like has brought sales, we've back them Bridgeland I in quarter. I saw

Okay.

second aviators aviators. Oakland The to fact, mean land. well you on guys you guys As. is bought I'm the the a Oaklands market. known do have, the As What with but is this saw job question and does Obviously, in the probably this that recently within great the sure

if is ago, coming think years of my have impact Major out know the Summerlin leagues. the has they'd to that since the As there do was I comes the are a What contract a in, you view to understanding net buy But minor if the profitability Baseball changed. League and town? to Downtown aviators that

From aviators. for usually beneficial our think the it's perspective, not we just Alex,

Southern moving Valley Vegas Las organization the For an entire Summerlin, is Nevada, and the entire for incredible Vegas for to the positive of Oakland Las for Valley. Athletics nothing their short

We have an in side-by-side operate teams both agreed the let we've in Nevada. athletics agreement where Southern place with to

is this set the similar lower-priced where And option to in Silver with to the be to Vegas have our work going today up see MLB players Knights family-friendly, It's tomorrow's to knights. League way pretty Henderson Minor to Golden ballpark. really both be team, the organizations beneficial a you their

League AAA League drives get players very it team and team team the the And space Major street a at the we'll minor manners baseball that and to Astros the purchases. I interest right because Reiners, Pauls much Sugarland in place quickly. where being trends down league the Seattle has access sank, have As of not see there's to the the see, cowboys because only in they by population increases actually proven or more beneficial Like it's go But Minor higher the the teams and whether think, team for Minnesota the for price lot and a ticket there's their be a greater and that to strip. point tourism the this Tacoma down in St. the

Labor perennial to a Okay. little the to seem And in question. restaurant and getting your like down be business. seems better. to a issue be doesn't final levers feels it just Seaport

you look offering you're business your versus your there, As Jean-Georges guys now? and modeled guys originally experiencing at what down plan with F&B you what

you push an or originally talked about an seems it out the that issue else, guys lining the is or could that it's maybe line that still is something is always issue but versus more time what profitability more issue? penciled? you labor it of to Is labor be Or up of

Yes.

So of for gross I'm stabilized stabilized from performing [Indiscernible]. and one, profitability net well. any that are better going X and Fulton incredibly restaurants than And the we sign implied like that the And retail restaurant you the I down into to the earned rent more peer sales what's lease we think then the those question the of Fulton, restaurants the kind peer that the would if components: it's operations break on the between on did today.

I those of as it And margins, know and and labor but cash point I to costs. yes, labor flow it's those higher great profitable a was we're Manhattan. I'd fact, X leases, sign Lower because still only traffic Howard activation driving in very and could. But a is restaurants use, a if result not impacting the great are to In or coming good for peer

Now the Tin Building hand, in we're on the the period. ramp-up still other

up menus, bit recipes loyalty experience our over that build and ramp customer correct. We're and that as again. back them base Overstaffing get sure come wants still customer over to we a customer is to incredible finalizing make that

the coming it will is months remainder flow labor the that, X start cash it employers talking we're the we'll I dial would for highlight to the swung that back margin. tell in pendulum ledger and of you coming feels this hopefully get X Tin the rationalized little that that challenging, to level the about more Building accurate labor back like side kind better you're Over versus a throughout But months you And result a as year. a on drive and of ago point Alex. employees. from bit a And or the quarters, of

Kim John Capital with from Markets. question BMO next Our will come

MPC be into as And as back commentary would Just build think to translates wondering looking homebuilders that acre per inventory. price sales, sales? on when was about I higher you you any far forward? when talked David, on that going

Yes.

as perspective. indicator buying. had our that breaker of sales. a for basis, that And to on think is our for saw meaningful And a quarter-over-quarter sale home communities continue are dramatically. the future that sales we've So we land think increases home from to you I master that, best said we going in look, leading bodes what up future within is Do kind always home planned go well the price MPCs

a assumption I tough think to make. that's

think quarter, Do see price compressed, envision rates we strong I because we'll building velocity make acres. we past need per maintain see, we that growth. -- are like saw is these to double-digit this out and affordability we No, communities. sure mortgage higher in

maximum pricing can one an does of saw acres a new number the lot this a meaningful So a price number at price we absolute more at harm residents meaningful price with than we quarter. meaningful past good if like of lots, per of appropriate acre number

sales So to year. the really We price think of drive those or sales strong stay at this increase will And indicator this for level acres per hopefully, home the we're optimistic. land continue as will leading remainder modestly.

of our also that we lot million will listeners in Area $X.X quarter, community this price that of a reported that for custom the per average I the sales per of acre. is that company acre up highlight, had the overall in our for And impacted all the couple on Isle the Now takes Woodlands higher. John, for average and by we

continue number, of those X. than X was and percentage lot a per XX%, in exclude you less kind will. that residential strong. if And price up even seeing don't I very is X, sales, custom which that the the headline imagine you If is acre bit

Okay. That's helpful.

higher? are But Condo to softer? up off Can end deceleration the prices quarter. Or commentary fourth switching quarter this there? at the seems XX%. trended is pushing Is sales compared last to just getting to because XX.X% Village. on that you Just you like luxury sales provide what any quarter on Ward

sold we haven't but Look, started XXX% construction even I would yet. love to out, be

think to sell tempo XX not low we from is for delivering almost quarter to on XX there's the news becomes mid-XXs a great to we're months months we're only the harder it harder sell. that, building I exceptional. John, sales to a over units as have into going dwindles, a and have very of XX% your de when that to less left. handful inventory And also we units

that out I complete we at of be units when think and before between X% now So long clip building, we away if we we'll finish. quarter-over-quarter the

little the quarters, So by a every Look, quarter, spot we're to do launches the where we we're by that. that And sold get we going to to that entirely a you're XX% building. try a after by time on we complete. that just little of so then We chip sell almost subsequent excited over not launch. the away out

price of in And us, remind kind you end can towards units is sell typically do cycle? Or of the it you highest the the point between.

for Hawaii, you operations region and it I tell of diversity that of full across a of of I stacks, part our building as they the all Doug because all launch, like runs at would Bonnie, with who team percentage how of tracking in sales you get on building. tell the and the different we nationally, runs our sold they highlighted and and of sales our the to prices very, -- units pieces different you these heights who units establishes a And down percentage closely met very are revenue what towers. that would had Investor Day

start the we greatest see higher from demand. And there, can where prices we to drive

I would a very So usually down, the revenue units, or tight. up within lower of percentage say it's to or percentage of a but couple quarter, per of tend higher points track

is Okay. and down you Final growth, on any particularly improvement the the provide occupancy went year-over-year. commentary in office multifamily, on where question operating Can in same-store assets.

could on commentary wondering add if you was that. just I any So

signed different ton of representation really flow what great do. we'd I do line. three like We that pride all but bottom it's a segments, expenses We think a were to that. leases higher quarter The really, managed to rates. classes, in And this to is something well. the operating well, that we our more may operate we different them cash at and drove we we across And think Three we asset take

that expenses, And heck grinds it's deliver great work our into day kudos know to team desirable and complement to comes entire and of leasing operating day every country, higher I our is results. and a most rates showing assets that that's have the team these a this been our leasing like to driving every amount at it's that operating across experiences in huge tenant in thanks cut in our communities

onetime Was terms that same-store drove higher? or anything revenue expenses in there of that number

And modest deep ago, refunds I year see wasn't We had the a this a that year. that's experience We this of termination the quarter. slightly freeze, fee remainder higher the some drive insurance didn't think we'll there impact. we there real We will costs look, a It's tax everything. continue again buried never had it not to expenses. which major estate year in operating going sometimes to had throughout impacted you know, --

of just think I managing But that it's small a assets and there's well. number managing about really overall, them things.

will next BWS from question Financial. Hamed Khorsand with Our come

first properties was, you office few stabilized moved So question into more a NOI.

I'm So what just was forward, operating operating look only like from it efficiency understand mean does the going if trying the X% I company? to about margin.

If looking a stabilized structure. you're at operating

I'm more rate? properties operating expenses understand efficiencies you and stabilized when just your trying are in reaching do to how more So find a

you And about talk into the better our I is properties can a asset. the more efficiencies. we that I best we market, more drive that example and can multifamily think give the we introduced when

and Colombia staff multiple the As ability more and to the use in have properties. more each Woodlands Summerlin, that are adjacent cover build we we same assets to the other, immediately and

greater property to footage. efficiency. concentration submarkets management operating in a square amount really -- think tight the of our ability better organization by of results terms in having a have We And assets of over drives extend square I our

in like show Correct. up. this quarter. it I just up was start mean But seem it didn't it Does showing to

up, buildings I and period, that as we'll well. fall lease-up those The the efficiency a the properties line. mean during to which going headwind leased time. as rate, occupied stabilize. to And family increase office stabilize But over new bottom new they real long-term buildings look, time, period to be as to of see the it's we will -- hit will. benefit behoove occupancy is NOI margin as buildings true deliver, for and that same think the will negative a retail new that deliver for they're as it maturity, low have then the I us

winter. didn't York And during New mean QX, of have much I a

did So to for you? traffic any into roll QX weather And the that does momentum help you? as

better easy than an than but hard is better An and winter, is easy spring/summer winter even a winter. definitely fall

regardless headwinds good of definitely whether the throughout bad. there's or it's winter So

we think a did if we a than difficult bit better little more have would I winter. it were

experience And traffic Tin I come Building saw that we attract remainder continues folks to Seaport grow. that, PierXX. that to And think a the that out and throughout experience of and more year we're hopeful the come the continues helped

out find the is of people amazing District more and how lower and the south just more Seaport Manhattan is. As

there in year-over-year. Is Last here mean XX% I interest any given question. expense change up is your are? strategy your interest where rates

going trying the of environment. how this just you're So to I'm kind understand given to manage business

of our the cost rates we bar interest interest line. size and and but more higher bottom also set Part required to in of more rates company developments higher assets of debt the the financed increase conservatively the we've our with Look, and just added increase increasing line new year-over-year investments. higher. as an expense They capital need them on the and have returns on our top is that new increase not

and we continue and our we yes, can limit cap as swap to exposure. as much So hedge

Instructions] This again. operator is the [Operator

today's thank we them question-and-answer will everyone also We We very and attending and participation. quarter. presentation, you see all today's will actually the for here, we next for session your want conclude Thank much will conclude call. to

lines. You disconnect now may your