Armada Hoffler Properties (AHH) 9 May 242024 Q1 Earnings call transcript

Good morning, ladies and gentlemen, and welcome to the Armada Hoffler First Quarter 2024 Earnings Conference Call. [Operator Instructions] Following the presentation, we will conduct a question-and-answer session. [Operator Instructions] This call is being recorded on Thursday, May 9, 2024. I would now like to turn the conference over to Chelsea Forrest, Director of Corporate Communications and Investor Relations. Please go ahead.

you Call Armada and thank XXXX First and Conference Earnings Webcast. morning, for Hoffler's joining Quarter Good

On the Shawn call is COO. Lou this morning, in CEO; Barnes-Smith, addition Matthew CFO; and Tibbetts, and Haddad, President to myself,

provided XXXX. press the conclusion supplemental were the this of through our in call the The along be replay available replay X, morning. package announcing call quarter distributed our release. earnings, The release press shortly access with A will this are numbers of to first after earnings June the

For those will presentation, of the herein who subsequent listen rebroadcast and of initial as be not to remarks we this the the today, are XXXX, call. to that remind X, updated May you earnings made

including performance impact program, the and our statements on outlook. call, as position, this our and our During related guidance liquidity well of and as pipeline, portfolio the portfolio, our statements, future our of development acquisitions construction business, mezzanine dispositions, performance we may our forward-looking our activities our to financing comments make

a or cautioned forward-looking of many assumptions and control. that of are statements assumptions upon beyond beliefs, account management's into which change taking of events all difficult known expectations, our currently any are may as expectations and are available. possible generally These is that and factors, are beliefs, predict not based Listeners and result which information to

the current expectations, in that have and in advise morning and cause disclosure that we factors differ we These from actual furnished and with can risk or disclosed this uncertainties our to to the distributed risks release to filed forward-looking we review SEC. results listeners press our statement documents the materially

FFO most which our certain FFO. not limited GAAP also package, and armadahoffler.com. the measures of website well included to non-GAAP as is non-GAAP but these comparable quarterly available including, the supplemental at financial metrics, discuss as measures normalized are in will reconciliations Definitions We to, on

call to the I'll now over Lou. turn

for you and joining us today. morning, Good thank Chelsea. Thanks,

As at another our release, earnings was you from it quarter strong can here Hoffler. see Armada

metrics. properties us produce our portfolio earnings higher We continue the new guidance operating see online, our gives robust offsets success rates. combined from This, with headwinds operational to interest confidence in as our coming

details projections rest and year, to quarter Matt reiterate give for take the long-standing regard allocation. on the a and I'll of to you Before the our the strategy with capital Shawn minute

gives management As is active the of than largest This holder most different that perspective strong a teams stake. equity to creates REIT XX% know, most investors dilution. you with and us company's of alignment aversion with a a external management

long seen While important is to unacceptable market way discount. recycle over portfolio is equity when growth, prices at stock valuation. an common goal efficient is well trades at implied market's important above the the the us most assets This growth you capital Armada that of have activity term Hoffler an numerous raise and component capital an

embedded environment such raised a couple significant profits. as current equity be necessary the just next over months, X will by capital any is new many assets of properties The online as primarily a coming selling XX circumstance. with With

relatively these a earnings. produce to and expect We amount transactions be neutral to cash of substantial to

comfortable recognize portfolio We growing quality NOI with and through remain properties. new the we But assets, leverage stabilization of that the will are trophy these elevated at levels.

have underwriting in the market are developments, initial selection. our about expertise and the We extensive the confident of quality we

the Matt Shawn couple now highlight metrics to over update. of the quarterly for a to call I'll the turn before business

and morning, Lou. with you, thank Starting earnings. Good

same period FFO last diluted reported over $X.XX of quarter of per $X.XX increase a and XX% FFO XXXX, we normalized share diluted share, first of year. per the For representing the

year-over-year ratio both NOI year-over-year a dividend growing XX% last quarter of our supports same payout growth. same-store year the due ability a XX% well-covered which and period earnings drive $X.XX growth, to a These for with increased to first consistent property share of combination to demonstrate over AFFO. the increased and of increases and diluted per acquisition-based AFFO X.X%

my I'll provide guidance more details on performance in expectations relates to as remarks. it our later

remain deploy metrics commitments last the estate with sheet of balance Point our projects. and financial as tranches we quarter concluding Harbor development financing consistent on Our real our

Stabilized EBITDA to debt portfolio ratio stabilized service reporting with X.Xx is portfolio coverage debt at our X.Xx.

of cost mature derivatives just until remains XXXX. average fixed weighted X% Our debt October our of of above in a portion

the calls matures. on pipeline and our previous remain will earlier until earnings by mentioned As Lou, current leverage elevated development

ratio to a debt coverage we to total is today this value XX% the debt enterprise eventually to expect corresponding with range. about X.X X.Xx and Our XX%, the range in service bring into

to to our table category respect the in separately. on With Page each package financial through of guidance, financial X guidance comparison walk performance supplemental I'll in our

quarter, $XXX,XXX NOI Strong reported range. property savings expected. of additional retenanting property the above of commercial multifamily year, approximately $X throughout with the better For coupled will an midpoint million the previously NOI than stated the expense add onetime NOI

quarter, the to million line midpoint remains segment and X lower quarter profit expectations. $XX.XX our X with the segment be Construction Construction year, $X.X consistent the quarter quarterly quarter range we in X. reported The and with in this expect profit for The in guidance at of quarter and for million X

X was of Quarter our the timing expect we expense to marginally trends G&A G&A recorded million variances. midpoint expense and the Our stated guidance $X.X above previously for always high, range. achieve and our to quarter due

income deposits. quarter Interest more roughly reported higher X than due interest overnight $XXX,XXX on for to expected

year, range reduced by partners' our projects $X.X of interest For real one our income to exit due million than financing intent have to estate the the we sooner anticipated.

guidance line expectations. in reported our quarter the for expense Interest with

interest We $X forecasted. have, to previously range due than rates expense higher million, primarily interest increased midpoint by our however,

the on activity capital the real for strategic assets remainder longer refinancings, of one based our estate realization capital equity any dispositions from of expected no of year. markets Finally, and projects, are financing the we material of modeling

aggregate, taken result share. per $X.XX guidance to share details our $X.XX remaining NFFO at These in in per diluted share per range

made financial package. I everyone's Shawn, couple updates to to over to would like we supplemental a to pass attention I the Before bring have of

On a presenting metrics we Page are XX, revisualized assist added valuable profile dashboard company's performance. the new respectively. and believe details have that on a and There of profile, a our credit of will range with you several portfolio Page company's pages metrics your and performance. These X evaluation XX we represent

to Over Shawn.

and ensure thank for in $X.XX unchanged you to all range on and quarter. to Thanks, joining revisiting us not is to Matt, guidance is we all what like XXXX by included review our what of to the aligned are out start guidance $X.XX. would I our that

you Matt through the walk gone what over. add to just color will has I components high-level to

any current aggressive conditions, and the market refers activity, we across the significant material discounted As is finding Lou to for change deep given capital first but removal said, equity relatively just bid several to price our an our and that multifamily what not of markets. are be also the of stock

the asset Our through later assumptions now in sourced year. reflect an disposition primarily capital being

a modeling fall our Specifically, of multifamily in disposition the cap attractive we is asset more currently at equity. the rates pricing significantly are where the market than

value, consistent ahead NOI first Our Across is component performing our we and all guidance of prove slightly remains it. with XX% through quarter. of evidenced expectation This intend shareholders sectors, is well Therefore, the by occupancy. to of the quarter. own embedded as our last the portfolio

loaded an to be That perspective year reasons. front X for expect earnings the said, from you should

and ultimately then higher profit the in in First, quarters, will profit. the of year the the construction and a third for construction will first of at half stream midpoint fourth targeted reduce component be our $XX.XX of resulting gross million income

such Southern The of the second relates occurs realized earnings Post to fact lease-up the cost development Georgia. a in be XXXX, our benefit Southern guidance our not Roswell, that Post associated carry a while in leasing XXXX. is mixed-use will up development, Unchanged with in positive through

a I highly performance. review development, office, leasing will expect We the XXXX moments, of anticipated however, handsomely that from is few will which do, retail well and benefit this results multifamily. progressing the across asset's In

of intent partner our to And anticipated. assets in a pursue portfolio financing the one sooner finally, our sale than of the estate real has signaled

second of As XXXX. we income forecasting a interest reduction a result, the half for are in

that our interest result A sale and also capital returning in accrued would mid-summer. in on project,

that anticipated, partners we are pleased are would we sale an our less income transaction. contemplating have than interest early Although slightly previously

in asset the The this our sale the potential financing be on deep strength target program This partner's markets. demonstrates apartment to at a cap real thought of strength and a our investments. pre-stabilized collective space, our a rate the capability in equity execute mid-X in of demonstrates market oversupplied class estate sale of ability to preferred project our successful

to expect deploy the preferred portion do into We the equity partners. capital opportunity return investment another same a with of

high-growth attractive the very a in investment is targeting are located quarter. southeast commence in entitled and market. should another fully project fourth We This

and We XXXX, XXXX. interest which anticipate of in income XXXX in into and year a portion a provide offsetting some will and XXXX this interest income funding in balance

of was on WeWork WeWork not touch projections. specifically XXXX I'll December with income annual income what the was associated of removed $X as reminder, Approximately and as Now in guidance. Atlanta in guidance, in a never XXXX, included million XX, included the was location

property. this remainder While to reasonable leasing able retain of rent. will it activity WeWork of and the significant we floors discounted renegotiate Durham to WeWork affect set a materially location, be both for XXXX unlikely The in the keeps and is beyond. space the receive terms opportunity will vacant XXXX, a were on remaining for year in Durham will that a

representing is market rent only X% than less now the return of than space. ABR will going XXXX, currently to one In remaining vacate and of WeWork to floors XXXX. lease, in and This X.X% the less our portfolio WeWork on

consistent fundamentals rents time properties, increased spend realized through value In space walking our leasing creation market-leading occupancy our some across me activity, re-leasing statistics. is through commercial and sector. and Let the

of daily XX In the including XXX XX.X%, feet spreads commercial addition a XX% extensions through first the re-leasing we options new at total square while commercial over quarter. of occupancy XXX,XXX to of maintaining and for leases, signed management overall tenants, an of

the XX feet total and The Office Retail a The of re-leasing average that X at property years is XX.X%. key with to for segment renewals values. average new lease re-leasing lease is spread XX.X%. leases X.X XX,XXX of a proactive The relationship segment believe executed tenant XX,XXX for an The maturities. of average signed NOI X renewals minimal short-term total was management commercial portfolio feet. spread maturity and maximizing square lease of weighted We

XX% The projections over our at multifamily occupancy. portfolio beat

to of year. expect the level sustain throughout We this performance

and the their in Our therefore, leasing multifamily partners management management submarkets, are XXs. respective sustained in rates property resulting strong occupancy high team asset in experts firms with who

superior The of above peer results success relative level office product to the set. at of in result direct location a of our ecosystems. the end assets produce is the broader well mixed-use XX%, occupancy This continues high of

space demand properties provide office tenants who investment-grade top-tier our the mixed-use in environments. amenities in newer anything from prefer buildings, walkable place markets create generally of respective XX% market. their else We are has our our which and intentionally that over

of class underpin our no in a In in Harbor Point This the strategy growth Post each future market competition. themselves in continues with Southern office notably projects. most most development to cases, our properties are real and of company,

to results. continues business produce construction Our record

backlog, working the results the included a $XXX targeted quarter While first yielded million consistent in through with current our guidance. XXXX projections profit

that continue opportunities using capabilities demonstrate firms our to partner and data allow our opportunities. underwriting The collect on development us execute market construction for to identify and internal of construction expertise and further our

The development realize platform earnings we the into us of and X to of setting the guidance, to up continues expect with end XXXX. also projects through consistent this year, produce delivery embedded growth results

stabilization in leasing to in approach continue will of half experience the into cost mentioned XXXX. second earlier the I forecast lease-up as accelerate, we XXXX carry during we we as Although call, to

been has commercial of north As in the especially XX miles leasing due in demand trophy only space, Georgia, in I Downtown at Post new asset mentioned, the the soon-to-be Buckhead. strong this demonstrating Roswell, robust project, Southern

at running We are XX% the forma commercial levels. of pro space now rents ahead leased in

will limited apartments Similarly, momentum we apartment product slightly project bring and headquarters year. our and spring Rowe the we high-quality situated summer T. are workers approach approach on in submarket is anticipated the to this forma commenced. and among trophy The Global months. The underwriting thousands later build-to-suit supply the site. leased, Peninsula of is above recently looking expect given to we professional project assets and pro the well continue active as Price are The the move-in XX% and historically the rents of great move-ins as this

quality to tenants We experienced flight Point. top-tier by Harbor our at will ecosystem credit are looking continued be forward to the inhabiting that

market and come. also top high-rise Allied and to months will at be The the completion project the component Rowe nicely, is complements in apartment progressing parking apartment sits T. garage the This also building the XXX-unit nearing Price project. its of we

at are XXXX Its and views other we forward this Baltimore's and apartment amenities Point project virtually complementing trophy Street. our to look best,

any machine and We firm creation the is performance, provide NAV, future. if positioned believe quality, remains focus believe Finally, well steps equity will asset and a our take continued for to we market realize shareholders, we that to our our growth real on to given that asset estate our discount trading equity value at for stock necessary for sales undervalued. shareholder including value returns, is the

we Operator, session. are for ready the question-and-answer

first Your comes of the Janney. Stevenson question Instructions] [Operator with line Rob from

side. the about in thanks and ebbing Shawn, for guess thinking occupancy I one How portfolios detail. leasing be we the year? the question throughout the retail flowing and on should office

Are to new it terms it leases tit move-outs for tat dip going up? of signed is trade the to substantial back of in it consequence outs, bring that the cetera? and et relatively then of Is cause sort

as about be we thinking our year? should that throughout we model on work How the

Yes.

this In for Rob. you your for characterize term, tat. retail, thanks and XX,XXX it the for and as use here morning. There some to foot then -- being the XX,XXX move-outs. question, for some And I think are tit backfills. Thank would I --

We the space, we have activity lot of a which are about. in excited

I that loss WeWork of office, would say WeWork, Atlanta. in or of removal in the where intentional main occupancy, the at sitting least of is it the today, is driver that removal the

So XX,XXX there. there. activity Good feet we lost

not As down comments, said certain certainly we we'll there. I year, I'm in but that some have get done activity this the that

how that see we'll out. So plays

relatively So office. in we as should that view consistent the

it's little In a the multifamily space, misleading.

issues units, a units XX flood number in Due has to range. the in and the actually more XX, quarter. like to have that water North at XX We down Carolina. shrunk That of end down somewhere

So in been -- adjusted by would those denominator. kept occupancy we the the have way, occupancy adjusted the The XX.X%.

So good there. we're activity seeing

quarter results. actually in the We're trailing X seeing the improve over was trade-outs XX what

to So we're blended trade out X% there. closer up

So the And continued in multifamily we looking space. see strength to there. success we're forward

Okay.

remainder supplemental $X.XX the paying what You 'XX? Or were coming XX of the to is of previously to with of ABR the level the $X.XX of lease, million mentioned million reduced is WeWork, rent that ABR, one Page the -- the for agreement? the they

on, essentially level sir. Yes, end rent through reduced million $X.XX the the XXXX. the Spot is of

X.X% number was in that You so my of out drop top to $XXX the of that and XXXX, obviously will XX, will. ABR, see down will or comment, them if the drop which thousand you than less

Okay. to jump really reconstruction That's ready are able are to there to basically that vacate, to event to currently the they -- get year have in a they're be helpful. once going Or is to is you then it market signed, market And this or guys you on second floor that? done? somebody going go a later that

with cooperative a have We tenant. relationship the

able And market in so and we the are space. to reasonably get

essentially, then our your come will and have is to Jan space X. now. And back between that point, to to, yes, So hope good activity us

that X thinking complete likely anything And in 'XX? you're X back then those complete? or projects How Okay. the such up? have obviously Is once all stuff big 'XX of you start not the to early year. projects, supposed you Is years, later are guys X half environment new this teed starts about to

how How guys How once are development? should you be thinking -- completed? these development should X about about thinking we are we

Rob, it's Lou.

expectation announcements only space. would coming thing that nice old of some will the up. of our Columbus Look the the we Village is embark So on on Bath really rest with redevelopment XXXX Bed the that for be

development. pencils launching have any to rates. are that be basis prices to what the XXX make spread, our on to not with And of that's where things a The to equity construction anything right that, would XXX company. point now, look interest we're a Beyond accretive seeing worthy spread we those of and

of or number is not right attainable I the office it's we're launch just there, to launching space. any that and of out want opportunities spread shouldn't office sectors appetite a Believe say would there's the not that not now, at. something any not, we it on now attainable. in Right build-to-suit just of

thinking come and you to that of out Okay. mezz that trying you last II? other expect is how going about forward? That's that one figure income ones? Just money is Solis out to City should Or the we one interest then helpful. for to me. the be Matt, lost Park this year, And

Rob, to to actual so believe competitive for We I'll forth. of so reasons, of let our on and number and identification question. that Matt in announce on partner of the defer me jump best for that property. on But probably a the piece second it's the

assumptions your are Yes, correct there.

exited will We on the from income interest reduce the interest property is when potentially that of program. expectation income

deploy in guidance, that through. But to for or all and to once, I money look straight that that not of a project it's in will in schedules at financing going just another bit time take some we to a of year. of later go will real would had new out go the we've those estate caution draw back As little

that of anticipate small potentially in So the the back we portion out going a quarter of final year.

this Appreciate time morning. the

Rob. lot, a Thanks

next Abramowitz Your line of comes question from Jefferies. from Peter the

Yes.

So you trade a I this quarter with I leases. multifamily last negative mid-single kind out, of think added in your and there new chart digits quarter and it's on noticed

just you the to what's any of embedded your year, inflection there, the are expectations sort the and rest trend of of for an sort whether guide? talk in Could of kind you visibility have about what the

being Yes, Peter. the for the positive. X.X% this Sure. morning, here blended was quarter, you Thank for

negative New while leases, renewals were to positive. your point, as were a X.X% about X.X%

about kind in and has seeing new renewals X.X%, the we're trailing to range. out a XX positive What X% about the That on X-plus in blended. up leases is the the X, trade then of since then negative shrunk are

improvement seeing there. we're So

kind of I X% about give occupancy, blended. should X% year XX% to think growth a take, or be of thinking trade-out we and

we're there. So seeing improve strength

headwinds, has the in Charlotte most the people there but know, supply market, the would seeing say, quarter, offsetting supply some in of some as in this Beach first Baltimore market. do market, and also lot in with some in challenges are the Richmond Virginia -- online, I A kind we strength are of to

So I improving yes, digits low and blended lease on driven stronger say, numbers. single new would you go-forward a probably by should renewals basis, see

on Got you. That's question helpful. multifamily. And another then

a about pretty strong on talked you disposition expecting. rate So the cap you're that

I the think happening. your I lot that the Southeast, asset your where lower of supply is is the think issues multifamily portfolio. than mentioned those of are in you've rest a occupancy And

of still seem just guess context cap rate I deep, it to attractive. pretty the would because is pretty pool trying pricing some the get is around the still that there capital

are and kind challenges. year it to pricing off buyers some through brushing or just sort of despite supply can the Is context simply of the you around just the the next how strong still get supply X? looking Or

Shawn but to there, what make said occupancy let that The dip want in I'll solely is what answer Peter, looks a I I in specifically, due insurance earlier. the properties occupancy, reiterate claims. sure those to down we like

maybe perhaps left wanted but in we accurate So and be the as possible. those shouldn't have, as we units we denominator to

those We expect lease back back come they right to online. up once

So We there got occupancy. dip in Shawn. really wasn't a

you're XX.X% Page to I the Peter, looks there. what in right The our to, units dip referring like it's not And on to think contributing Sunbelt XX. Yes, are again, there Southeast is that range. XX occupancy

given moving insurance Lou's should point, there's thought the thought forward, we we denominator. kind it of to keep So in we effort that an

XX We cut adjusted at way. down macro, adjusting that But XX.X% for holistically those when can high-level either again, units. we're

interest is at Lou to has us the due would the but capital. to strength, prudent for capital and said asset of location cap to alluded say we particular I is that And great asset our the -- our move I earlier or for and is in properties. in your as typical believe, -- types that as with this the been quality that as the of about probably us, those strength of the question To terms most rates yielding that harvesting -- due

That's back build-to-suits. ago then to one a me. And more office minute go for comment just helpful. about Lou's I want to

And wanting of have the you're kind on a hesitant those. tenants the of to the Or factor Is that costs? So the office about to and started won't hesitant is they it it get construction once not premium exposure? of then to just like more sounds pencil. rents they're kind more understand pay, little increase a deals

to credit would need engage really It's latter, We honor launch. make would the that Peter. a the to order in with tenant spread we Yes.

next that trophy Today, that are outside people number cap to buildings is normalized X. I or at the what rates of willing to expect change some will in not-too-distant go or the realm year pay. the to point. office future expect back I in

be right lookout. we'll So But the now, just pencil. don't they on

some played a just at far as don't year And to looking now. of we're the estate start we've stabilization not spread. play seen we going to X XX making companies that want as game years, we've real -- and That's a or saying game they're X and not for

That's more helpful. Any I of you. now? those where you. most are I Got And particular kind active requirements markets have while one guess right

in really mixed use. ecosystem of our It's

the can would you couple don't So here get that lot guess Point. shoehorn just in tenants a of activity occupied in in building. there's of we're Harbor XX% trying have still Beach, a got And We've into love Virginia tenants to in still Baltimore. We room. a to

But just launch. can't again, you

all Got it. for That's me.

line of Your of the question comes next Camille America. Bonnel with from Bank

to are route You dispositions capital today. had mentioned your raise preferred

bit just more. this expand a to I wanted on So

of you marketing how do if And kind interest What will assets, are big program be? sell? been? expect How looking assets has you this to started you

strong. as mentioned, tell to waiting assets is assets of where value we will a pull looking at we're on opinions trigger. we're that X, noncore -- at X, brokers' these decide -- We're So you I can the interest I most are we waiting few disposition. before that for

variety. we're But unsolicited on a Southeast just we everything in getting own in offers multifamily of about the

years is looking quality a to, and multiyear for a then that's as the current an viewing alluded it discount investor estate to hold. real operate pick environment at Shawn for quality everything up opportunity They're as for Again, come. to an

our to stands. we'll So where happen. announcements the growth going not-too-distant in markets that is making are activity And some on that still future be where

capital. it's kind a as cap might to by X result. and larger the rates online coming at, year next company way properties as said, be in as X, And looking we're any of raise the most or I the you substantially as far will subtraction But with at efficient many expect, maybe

balance how are any your with to on on And any plan updates near-term the maturities? address How going there you Okay. sheet. conversations shifting your And around to extensions? lenders are

Just of get trying profile across to doing your you're capital when exploration a debt far how sense your planning. you're looking

the of A initially. and back have limited. interest The them Yes. lot the loans couple have of slowly a lenders lenders coming looked term market from at syndicate, we've still to I we that When we it's to have capacity on say those are would conversations. to

It's very the first say a lending of it was I that but up has than in year. that there last the year eased when activity, probably better here would limited was

a have construction going to We we pay were we're extend. we small to that maturities maturity of able and couple off loan year at this had a that

good rate X-year X X-year we pulled a option on. relatively first the have extension options that at extension We

our much we sure concern So we yes, too it. the the nothing we're all us is partners available for really, debt into But to in as of may and get capital side contact with constant until the really make that need XXXX. when lending of of end

those Okay. opportunity idea is XXXX maturities, or about is to address And to when those you today? there think wait maturities the

think in terms looking of strategies seen I across how out. mixed far the you've REITs they're

Yes.

So, we are those monitoring maturities. always

transition those this penalties we there unsecured limited as balance are know, loans. into on very very, prepayment As sheet, you

out would rates, go ahead could. and we refinance the of we those right and course, when or as at So terms extend

right utilize we will rich spreads appropriate yes, love Treasury some credit are We as at to continue at The we have taste said, take little on our the for the the action. still investment-grade would will and a rating. to appropriate But we the bit And point, our now. monitor. rates time,

right. And over forward retailers their retailers, though, that new the leasing quarters. plan. store few moving are We've activity been with has with past been hearing finally, the opening All slowing

And saying are insight certain prioritizing get to are what tenants they wanted just markets? So you? to on more

are any they a And prioritizing expectations. Well, of in the again, seen we haven't back certainly really certain markets, growth to markets. kind slowdown

our leased. is Remember, portfolio XX%

to we just whole The for actually -- them already mentioned, have isn't do much lot. there So multiple prospects that a that Shawn room all vacancies prospects. of

So that. not seeing we're

that what's But market people the really across not robust that? -- think you specific. board add we're to But to do that's seeing with want that's report sure in country. sales. Shawn, happening the rest again, I'm we of the sales the

to I'm that Yes, speaking, rooftops right? to just traffic kind well are add would that well-located that, and those I of as properties, immediate generally vicinity foot in back decisions driven tying by the as

and people So where ecosystems is to traffic, statistically, driving want where are our that's be located, business done.

good So I good we Lou's a ago. It's which And think a to X point, yes, bit thing. actually Camille, years than point, your activity. to up, say, is people signing we're seeing little seeing are different it was,

success continued space. good And and in that looking that to so about we forward feel

the Your line with from Raymond Bill James. comes question of Crow next

little notes, looking and back further. I old back some gone XXXX, I made just Lou, I'm it bit and sure through back a could to have

chances share button pause talking years, sell balance to on But about the those issue near at sheet during certainly the investments, mezz uncomfortable commitments, last X years, $XX et a hit to or been had you leverage. X And during cetera. equity levels we've new assets, of

So why are also certainly see It but sheet? it are reflects the we I talking be. dilution sub-$XX. disdain, still about the of levels leverage stock than price higher get should a balance I that

projects? difficult So just no ever to it -- good how we it a is say Or get down? do do back we

want something question, also, I have So been clear I And that Bill. up the might appreciate to a misunderstanding.

exclude is -- results. this from which This quarter, quarter, year it Change in exactly fair was it excluded negative, positive. value our was derivatives it. of core is why Last we

picks some So paper, fact I money, nobody we want up regarding derivative. some a the or make made to money on that sure made

way question, think debt because higher the on of always do to to side the other side, Bill, be size we much always efficient have our a leverage, far the we're I development is on company activity be to as higher the going as as has as your is with possible. simply of going most development that that kind

when them projects And those you deliver. you and then stabilize bring online ultimately,

is in So think we a debt way short-term sit I the the of marketplace. the reality

We stock and $XX $XX have delivered stock. with

assets rates. And at we're X.XX% continue that We have sold strategy. cap to going to operate

leverage Ultimately, range. preferred come that into to it bond we going market, ultimately see would Matt's plan X.Xx like where that in down with of will to the

core But leverage. portfolio again, will our full to going be always is simply development that be on because

of appreciate about. just When to years, think mean X we -- give So you that Is that. can I get X? think to us target kind do X.Xx? a

of I a you're mean, out. And we to think need couple economy that. participate the years in macro I again,

to spreads of like and in come normalization You'd a interest bit. little some rates see

But I've we're -- said outset, used the these the levels. to we're at as at comfortable

As an we've you XXXX, in Great XX% In portfolio all way occupancy. the gone the to recall, down our XX%. below all-time Recession That's went never probably Bill, low.

So income speculative of said, lower. lot would not -- be obviously, concerned about That like just it to it we sits. to to any where to to We're do We'd lower. cost. don't really going see have it concern market leverage the see a at the like

Haddad to I there further questions turn no are would Lou And to at time. closing remarks. it for like back this

another this much and and morning. just for have attention day. time we months. another great great quarter Thanks great quarter, a your in of care, forward It's look very and a to been couple Take

you conference And call. presenters. gentlemen, for Thank and you, this concludes Thank participating. ladies today's

now disconnect. may You