Brixmor Property (BRX) 4 Aug 202020 Q2 Earnings call transcript

Greetings and welcome to the Brixmor Property Group Second Quarter 2020 Earnings Conference Call. At this time, all participants are in listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to your host Stacy Slater. Stacy. ahead go Please

as Chief Brian Angela Horgan, and Executive as and call. and all be Vice Executive call With Chief President; Jim operator, second today President joining quarter and President Officer well Taylor, Investment and available and Officer conference me Executive who Q&A. Executive President will Chief thank Mark Officer; you, Financial Vice Officer; Finnegan, Vice for Chief you Revenue Brixmor's are Aman, Thank on the for

Before any remind available our the measures we we statements. measures. reconciliations Relations are obligation no information that comments refer differ SEC and risks regarding certain everyone measures today website. certain our and the on that to to in our inherent are use filings on may let to materially. portion and Also, statements GAAP and actual of Further of begin, Investor today We me described in and results non-GAAP our some uncertainties of earnings subject are these to assume release financial our supplemental disclosure may of contain based these forward-looking update as will assumptions forward-looking results future

you questions the on we the of number person. Given participants to two kindly limit ask per call, or that your one

to have If pleasure regarding Jim introduce At my the additional it's Taylor. questions this you quarter, please time, recap.

I quarter are and you that thanks safe second joining call. of trust well. Stacy you Thanks to of your and each each our and families for

tenants saw of as closure mid-April, during height crisis. response expense our portfolio alleviate the the XX% of targeted jumped sacrificing tenancy burdens closed remained of early deferment COVID-XX tenants how teams We've service is government of I Yet feedback levels, levels. and revenue team accessing terms with CAM both curbside assistance uses, have PPP for received open, and and for action categories that concentrated our relief do tenants more remarks other seen our and At that from and in heavily the to durability we in areas tenant additional resilience stating close, by a XX% to me traffic been our our recovery versus universally the are into in similar this with reductions bars, of had and of in remain programs. regional and evident already are in California. Today, my orders by pickup took. than for we've pleased tenants begin in forced signage our corresponding such a by Let performance approximately in approach drop in partnership positive levels and our last in those traffic we was XX% March without am re-closure like impacted which year. some closed of and entertainment orders as open restaurants, Tenants jurisdictions in

For we last getting basket higher those larger feedback of versus tenants positive that reopened, rates conversion including reports and year. are largely sizes have

unexpectedly but on positive been memberships. For gym gym, hold are in many seeing also new following trends have operators reopening, kept memberships the

For capacity to restaurants levels is restrictions. those outdoor up seating drive-thru recovering indoor or business while reduced are that with pick seeing due dining dining, have well,

standpoint, or uncollected July week. color collected the another for base but abatements second a quarter rent rent that as million week, to we have base deferral compare proved June But our reserve in been took industry another July of week tenant quarter. XX. other Angela in as with we connection favorably on where base underscore granted provide last rent out our also That equates of or approach quarter, as of our majority I of on XX.X% abatements tell $X and words, X.X%. the rent $XX will believe of a deferred broader reopening collectibility of we've the As and over that, those we collected XXth story. points to quarter during they we've balanced. base to performance our we've extensions only the appropriate rent statistics XX.X% abatements in From agreements in more and of limited were that and the into rates of turn. collection Of our and X.X% last basis part community-centered our given of or addressed entered quality few which XX last recognized of a recent upon XX% rent for of In XX% second of a of of momentum minutes. reserve the and our our abated believe collections and million, we've portfolio, only collection which rent

crisis. Our the during balanced continues business plan deliver even to

Excluding our X.X% uncollectible, revenues deemed with same-store have would in plan. NOI been line

new XX%, at pipeline new average of of at this spread a this not over leases that at an over of leases leases signed feet million of of $XX square signed, the also an $XX have highest with We And are quarter cash-on-cash over square generated have feet rent and of million ABR but XXX,XXX commenced. average new is in per foot crisis. million that, its level X.X vibrant tenants $XX at during years, last several

poised will, the that which model with for As we are business crisis recovery strong a this a it on capitalizes abates, disruption.

not of is failures, point been of to in for are the terms have in been the one tenant of crisis has crisis? that crisis but movie because continue fallout outcomes all of plan, economic questions through balanced business this of must confidence theaters our The spite But, positioned that about wide the will the What no outperform, these duration revealed immutable for just Where tenants underscore forced be teams the to and this is restaurant will us, reset impacts. that of Brixmor knows course, truths Of it. disruption truth re-close? have Will how management responsible answers to its relatively questions, this our modest occupancy and persist recover? in to of overall and range scenarios. potential which rather ever the there be of and some prepare a themselves

you've rent as matters. First, me basis heard say before,

spreads bit the benefit rolling moderate from levels, three significantly to While five next still below-market a expect rents we to from historical over we years.

this cost a In last focused average tenants the the three key rolling we've fact, And the rent are, months been well anchor anchor $X, signing of and focus. our over next course, below the rents is on profitability, occupancy as space on is over years store through increasingly crisis. XX average

and the money. still to have basis We these compete for tenants make

are again, the appropriate relocate to demand. to and said as platform evolve. to well-positioned in our national their accelerated prototypes basis has this compete I've models get as tenants, crisis increasingly that successful low before, rent given We are This willing evolution. for only size Second, store to

favor a of Fourth, been BOPIS occupancy customers. now proximity types obsolete convenient centers fleeing who our provide. open many the are and the customer not in the profitable coming consider open consumer. of the having their growing air number and serve mile would realizing superior within is tenants costs, of formats, ago, finding They importance struck of to two tenants visibility by that us ways to in are pickup and last product curbside how are We've air are product retailers, retail there Third lower to the that years SAS.

demand, for not have only center hybrid of Sixth, also being that centers. these of to we of during of flexibility COVID. lots and drives occurs seeing because our resilience of well-located after will non-essential community channels. serves. and tenants within enhances We have a within durability cash Fifth, possible expect of the last are tenants, funnel provides we we to accommodate multiple an ample in appropriate centers and parking the that cycles. relevance accommodate the at models disruption in importance towards retail which the the micro much mix retail, and flow fulfillment the mile COVID it of and convergence flexibility to persist broadest shift our these to inevitably And It using the essential as having consumer, the tenant

these several business seeing these high COVID. right durable be drivers particularly which will And forward. impacting all same pipeline, very that Finally, our believe we strengths, we reflected going as underlying forward year our of are leasing strengths again despite of a at in our now, business is

forward, for income better we've quarter Looking represent space we've adequately expect low increased Accordingly, we more a tenant and reserves standpoint. up point to accrual taken basis. do a the of tenant should failures concepts. second tenants rate opening from increase, to failures the relevant the cash taken believe, expectations number these We of this year-to-date and an versus in of reflected

cover to growth the in primarily adequate extinguishment on While still the debt this we ensuring capital to adequate of reduced is emerge crisis. focused taken we dividend. we've the that FFO on this due as reported side on We remain quarter, loss reserves our the other have

with this respect puts the is to capitalize fourth the And decision in reinstate third next to favorable dividend our as quarter fully of on allows Our to ensure quarter allows dividend year. a position the us deductions funded pipeline basis. reinvestment us that as to on year's possible. us It best leverage-neutral tax suspension fully allowable in it the

entire be conclude want comments a we external mentioned growth my like most team, I'd beyond quarter, who opportunities position the through be time by in at have don't to when quarter, Brixmor to to after crisis outperform. raise will to equity believe, continue As to and thanking last a we quarter compelling.

of us serve. towards Thank being the communities you. actions the of purpose Angela? drive we our Your center

and Jim, morning. good Thanks,

rent XX. of portfolio, disclosure believe XX When the our To its its parts, second is to and to collections its for based the geographic COVID-XX we navigate second Our rent environment. impact on buckets tenant of with platform the page on and illustrate rent statements, including attractive coupled customers of our provided the abatement package, which additional as results underscore granularity quarter component on the base, this supplemental diversification. current we strength result the measurable deferral basis, significant agreements a the of quarter or into June asset base positioned and uniquely have proximity executed financial of

and Subsequent unaddressed as and a end, recognized and are to of base cash have base negotiation. unaddressed build All or to was million abatement accrued accrued you but rent current income summarize and as relates July modification, To billed agreements the which accounted to XX. rent during the million consistent in not collections was their rent of Leaving $XXX the through XX recognized of for portfolio, current $XXX million, are were $X.X the under income to only million modification $XX see, as base as are June to the XX.X% XX.X% not June lease XX. accrued as or of it based subject disclosure, that by reducing million the new as million lease during for period. million was well subject agreements agreements and term, additional As deferral treatment, agreements XX as the additional agreements or $X of separated for for uncollected, deferral to quarter, million All lease we Cash our of statement rent were base agreements deferral quarter statement $XXX abatement in resulting due collected the million. $XX.X which deferral accrued relief total of during of quarter other $XX.X at million, deferral June flowing period. $XX.X million second executed that and in our FASB. with extension deferral was concurrent accrued will of generally $XX.X was of rent on abatements $X.X base executed, accounting rent the of provided totaled billed

a period of balances. related uncollectible, quarter, recognized rent in the $XX.X related prior period recoveries to deemed $XX of approximately total and to of $X During comprised current we revenue million base million million AR

XX%, $XX the related a of XX% amount of million represents amounts end, a amounts June and reserve highlighted, as base the uncollected XX% or XX, to unaddressed deferral executed collections of subsequent represents of unaddressed and cash not recognized, to negotiation. rent XX% $XX.X but uncollected the the Jim the reserve As on million Based on comprised over deferred total but quarter agreements of reserve XX% on rent. uncollected under and and

In rental also collectibility in addition, reversal straight-line of analysis million of accrued resulted the our previously revenue. of $XX.X

NOI year-to-date straight-line acknowledge were tenants. of deemed basis, revenue, to quarter, revenues of X%. nonessential approximately as in growth totaled uncollectible also a per in rental reminder XXX income basis and $XX.X million. the negative second COVID-XX taken deemed was points quarter and reversals same-property adjusted, straight-line reversals and total share certain NAREIT uncollectible first totaled was the on watch-list impact a revenues On As rental $X.XX the FFO

quarter per addition $X.XX million $X.XX loss repurchase uncollectible income to of revenue related share As debt deemed per in of $X.XX and on discussed, XXX basis straight-line X,XXX per deemed and a and reflects shares basis during from contribution the legal reversal, and net unsecured a $X.XX from litigation from basis rental non-routine of expenses. of other revenue growth recoveries. per contribution uncollectible, which share NAREIT extinguishment of notes reflects FFO point outweighed the rent point NOI Same-property share $XXX XXX base detraction point of to

service burden on many have and the lessen leakage manage we levels back discretionary adjusted As across the to proactively company net expenses portfolio tenants. cut recovery expense for operating and impacted the on

to proceeds used $XXX $XXX of repurchased $XXX unsecured hand existing We sheet. to bonds Turning under million and on million balance of notes. revolver our the million and the unsecured XX-year repay cash raised during quarter second and XXXX the

of capital transactions, total billion of by have we of no of cash liquidity $X.X million As the million substantial any and funding revolver. our under significant hand the XXXX. and levels our until current is of Based utilizing profile platform on expenditures, liquidity in the fully light improved that during fact without operations on recurring $X.X quarter made these in This we adjustments result maturities billion availability over the collection rent are particularly a of to have we the of $XXX comprised available $XXX and liquidity. our debt operating

XX% XX% and after rates cash collection as July XX. quarter XX.X% the course maintenance collection realized approximately before or XX.X% approximately second is breakeven respectively below leasing rate the and normal CapEx well CapEx, and Our in of July,

many ample a While prepared. strong fully such current to we position the for are cost liquidity pleased environment, unknowns mindful challenges of also with the navigate must to are we which in we the inherent base be in remain

this turn in to believe Board productivity attributes demonstrate positioned accretively reinvesting the and centers ensure we our We we that And post continue portfolio will crisis. call stronger with retailer to believe strong measurable and the define and is shopping will Directors better business platform. success suspension emerge the of rent I and the operator which place to community platforms has crisis that of for result, on a with of well-located low it plan, our best continued from and As over order In focuses temporary dividend. long-term our the has these in neighborhood a will that Q&A. portfolio

question-and-answer time go Christy Instructions] This question from you. [Operator Thank session. we will be conducting Citibank. Please ahead. a The McElroy, is first

Hi. Good you. morning, guys. Thank

cadence be lockdowns in should how I we understand about QX of, or leasing to as environment? Just retailers sort QX, call would relative in today. where volume in through talk in the regard of it And demand new categories guess, this you're the today. would think to the of through gone coming to about Can from helpful sort you executing new specific you out terms is we've of, that leases activity

Brian we what of lot next a sign of several it of the of some question But leasing have continue in. we're with. have bring new flavor us predict this are confidence the Tough Christy, significant quality pipeline volumes. given quarter leases to because that that next that frankly signing quarters the a the the forward pretty give But I over you tenants tenants at accretive deals will we quarter. for of appreciate size the versus Brian? certainly and that highlights I'll to let we

terms during in performed some Yes. crisis. the that to during saw well tenants themes Thanks, Jim. relative Christy, have categories, of quarter we And the

the we quarter. grocery, signed in the in gross leases Northeast off during two First

more just three that more in were right added the have expecting legal behind that the during that pipeline we're and now to period through. We come

slowed Chipotle, the from specific we In plans XX% square to haven't of leasing up Chase leases active actually to BofA. if importantly, opening signed mentioned terms Below, who of terms and X.X large really you lease more end in his it down it's tenants, Dollar the look and feet. in negotiations during Again, have year at who with continued at as growth many of And the we Bank be tenants our and pipeline, Tree, Five million remarks crisis. Jim added have

what are expect the those hard of a during terms we signed many slowed starting negotiations to get to we that of definitely In and shake out quarter but had to predict. see bit,

circumstances, was what expect to we're where really the the I our But it from centers. are shopping historically. quarter We be with it continued considering to the team in be able demand on execute and think, during demonstrates the to down pleased we

your about take the to thinking that? your lot position how position. in There's you potential of you and uncertainty, advantage think markets your early. buy know to do I and just and willingness the ability of a still in liquidity in for dislocation then And transaction it's capital but today? about Are a

we're so And suspend It decision to we part it's of that that Well, of today continue capital. importantly, have we're a referred flow why careful to covering was these fact perspective some with and dividend. even part tough Angela the of reserves. the from to the do the liquidity with cash being

the do we our market, Mark? going property to points. and but pick forward, dislocation expect as be So significant patient we we're look in

transaction the start you've Yeah, said mean, case pandemic. think it I Jim, and the the slow I market that's we're been of well. a seeing today pretty since

triple trying the we given -- that the green leases. net pretty some to today the of figure sheets on But NOI and it's really issue where rate and with in main seller. cap to out terms seeing between is smaller to buyer are comment So early cap assets rates liquidity sits

interesting liquidity And Jim I normally liquidity centers and improve over as perspective So strongest acquisitions out think do. they did the we trend see years And we'll I agree showing I better community that time with the over think what's assets next with for where some be grocery the great our while you can we lumpy, is I said, it's performance. over what past see than of think from we'll the going the drive so really opportunities couple exciting going of find years. that's to we're to couple

you. Thank

important I there think disruption. of have is environment what's really Christy, that national the because we And, this is lot a platform in

own in competitive still a we give that one-off insights the tenancy, owners. us So of into core think our that's a I advantage market lot have a by

Thanks much, guys. so

You bet.

from ahead sir. [ph]. Next Thomas, James Please Todd Raymond go question is

KeyBanc. It's fine. Good morning. That's

question. First

When point of and at talked a the of collection the have You do And reopened I churn then about reopen? sense have you begin about Do have for you deferrals a forward Jim leasing think to paying at to being when the might ability recapture the combination to to a more level? normalized July. talked about take recover yet point non-rent you or strength the to XX% this those you've had in space tenants that for that how pipeline. that metric long and get not now

a of Well, seen it's tenant because interesting failures yet. you haven't lot

play timing likely some the over that the of see will of out quarters. and We will couple next

demand strength, how XX% going quarters going we're yet imagine, we want to crisis this think going be disruption to every fully as dislocation is what such differential of take negotiate. not. open. while open important extraordinarily space. this In important number And question see our may we an couple could in of through I is behind them are seeing part so open. in makes out. And you that to this to recover specific the believe give subsequent related through and and Todd, the from And how terms an think to in positioned timing, our moved their who when have and And typically question benefit but approach rents that make do, have terms aren't excess of substantial play it's a up But of think portfolio. thing, of want in that when that rent to have XX% don't I again to collection the healthy to beginning end determine tenants you that's we they powerful basis is really they to what because we are how businesses then happen And of that those is at we pleased. that where is is We're you But I money tenants to or we're quarter tenants to the place. we

Okay. I comments. don't if I it in missed the know

on terms all are So expect for at you and would to that collections trend at of August you to July? able how where relative to comment you're in

commenting in much But we're think going to not We're I be line. now. that on pretty

grocery And are you sure maybe your comments can Okay. then much fulfillment. what's if last on or micro how just in pipeline one have? How but not fulfillment was the directed one. at I'm exposure implementing mentioned portfolio? retail Brixmor's Jim describe that micro across you particular more you in broadly, tenants And today?

the Yeah. really I appreciate how And fulfillment, think as dedicating how their within are space the tenants the they're box. they're about boxes we micro their it's changing, question. and using how

presence, adjacencies had lot work. mile to The a e-commerce larger strategy It's is have models, a of competitive at was a good is this serve There addition it, with really And unmet tenants because within last a curbside it, around think already driver demand. or shown advantage. fulfill retailers I didn't reason that that doing. of retailers, position, that of need to our across that the lot certain frustration, some is, I for a country the we're incremental we're that the pickup helping tenants, And way our think centers. a currently business early is consumer. where demand highlighted has the number delivery but, of the who of have still. crisis bricks-and-mortar it's of what in The I And to fully at looking last an In discussions mile. they're them of but early, doing the as

also And to shopping and customers, parts But be it. to efficiently, of their use they so centers and grocery to but And that more creatively it served. they're of more adjacencies more And want their you see more it's a footprint obviously, broadly. competitive big as expecting advantage. about, think a we that's mentioned serve other driver how thinking we're

channels, As offer additional to ability for channel compete tenants pretty I new is we think tenants that a thing. the powerful or

you. Thank Okay.

welcome. You're

Evercore Please is go question ISI. ahead, Khanal, sir. Samir from Next

Jim, Good with any your areas everyone. centers? guess, foot Hi. seeing morning have seen in wave, collections in California, I Florida, or virus of sort the second of in the Texas sort differences traffic or like you're you

We haven't yet. But it's something that It's close we're monitoring once. to real close closely. again. It's difficult even for a business to them for harder

that is will We're a it's the little focused essential uses what segment they yet we're have margin pandemic. uses on because remain re-closed, smaller if of I much the that's that it. key a And impacts to about to those some be. in think largely part they re-close, have of to lot our or where the about relates still forced sure We're And open, any we're it. it. though bringing tenants demonstrated crisis. But even jurisdictions there the tenants concerned that so make we're of of can But the That's talking yet a course other as point, of We what of impacts, it's well watching in as see to hybrid early of this tenants determine, measures. through some on it early now centers want that are those Samir, the side as successful dramatic been other traffic to safely have to portfolio. as open, a have operate

the you I assume, where most stores of up in pushed guess, of this rent next here as do think been Brian should we have lease on still we that the Are out dates rent commencement looking in versus point? time spread that dates year Angela, we as stand follow-up the year? later commencement sort a today or holidays, for for open to for occupied about have, or at on tenants

want you Angela, to? do

XX% XX% X% the Sure. the and probably Samir, that piece today. leased a build commence and to referenced, -- that Hi, our rate Jim of in it, is spread that, XXXX, XXXX. $XX Between of course with XXXX. we makes about small during which between up And the Yeah. million of remainder expect into

over said of move significant do we reflect that expectations do commencements of for leases rent worked but XXXX, the them. And to we've time, number we the the this course a significant not spending with portion what's I year. But best capital based come it tenants on a So course relates commenced during to have should that expect the XXXX. into decisions, as of of year. online, made Those as

Thanks much. so

from The go Craig Bank ahead, America. of next Please question is sir. Schmidt,

I here terms in But of by the will you. in good resilience, closings, than are of had occupancy. very you've mean, you given a expect where Thank closing lower you do lease occupancy at increase the store permanent year-end, store quarter? -- be end second

is will what's, be result Craig, been on. impacted terms the tenants we tenant of our bankruptcy, declared do. that something for. certain expect, even crisis. in we minimally And And interesting rational in from that portfolio I made to the that full comment have failures this wave of seen in actual which haven't failures a we're But yet my of has remarks those think do that, it's parts is, capitalize the tenant different to in I position prepared store will think And closures. we're country, that there of levels good we

we have When think and related Great. then an do leasing in been could again? you start inflection quarter. And they increasing trending down by hit spreads point obviously

at things, keep than sector expect as we quarters. some that normal the want of place crisis, And leasing lease renewals spreads a you're the comment more had other to environment. you're I continue in albeit several spread that those I leads to that will to this the last XX% would bit. you and willing during negotiating tighter over the course, little a new of to perhaps we have not in on But deals tenants Brian cut maybe

do still a we money make to in. lot have Brian? of Importantly, room

Yes. above rents Jim it. that mentioned pipeline, I in you million Of opening Jim add the covered his Craig, in most are $XX legal remarks. of the box. would $X.X just

XXs here. low in over And our bit the moderate So see lease terms we're of place we renewals in a could growth rents. in already new

are As Jim those keeping short some renewals we part deferral are strategically mentioned, of agreements. of Many term.

term to So I'd this. bit. in in basis that been the we've see long can But pipeline in higher attract rent new able that really to expect moderate leasing you confident we're in a the leases And ability very to and even the portfolio. through rents that those number drive the the

Thank you. for Thank you that.

a We Ki from SunTrust. Kim question Bin have

Thanks, good morning.

How you? are

Jim. Good. Thanks,

thinking type in rent of low does environment, there's coming lower a know I'm more square matters this in don't saving high when And but in supply if much available here much rent loud just a bucks matter a locations, locations. rent of I'm foot really So rent a as options. of couple kind be of lot to at retailer, have where I out I going if that

And our volumes. location But leasing locations does of look the always Well, basis think I – matters. and assets quarter-out quarter-in matter. demonstrate I rent leasing And look leading sector forward pipeline. and we high yes, historically with think our we forward as

to spread, we're I get as I continue to believe several right? quarters that. which if If seeing this that numbers to locations to we're you work a portfolio the you going looking this going work longer money, at that you you've on you're to history to see to $XX, you're in given quarter that be capitalize and want capitalize have going the had capital through lower rent not $XX put continue If can think to you fact. great make look and to it's got as to forward of $XX rents. going on And the painful

they're are models, to be can that tenants going to key driven in to environment of be with that forecasting going forward rent. to their not the store by a sales improved think do just going sign and They're I going and to rent and be know tougher going any the even is profitable consideration. that particular So part they want

months? versus much reflecting being for And the just rate down of how reality maybe that a Thanks. because shut expenses sustainable just year-over-year. bit your a couple dropped lower of I'm run curious little Okay. of expenses a is

remarks, that service the I make did that of job the CAM of immediately I'm tenants, throttling expense really that changing Haig proud particularly burdens. Well, changing at I'm – team in the back to those had and really operations the property closed levels were scopes levels, it sure proud the lower mentioned

across it instances XX% to by the some reduced we So in board XX%.

traffic it the you up see do back we up level. we abate reopening to you expense savings continue will, tenants as as service at As the to normal centers, the picks the to if their assets bring have, they expect

an expense as decline making tenants possible. year-over-year sure intentional was as of the to our part response that burden low So very the had and

Jim. Thanks, Okay.

You bet.

We Shivani Deutsche Please have from a Bank. ahead. question go Sood,

mentioned several that good times to now elevated. Hi, tenant you've morning. Jim you expect failure remain

that being So norm you're leases leases, especially with or signed how team's how for new smaller just new to regards in underwriting tenants? the incorporating are changed curious, that that's the

The is to approach It as a terms to really in in it. insightful well. makes capitalizes but community types data. they you are credit, that tenant focused highly, are and types what getting with of do There's connect about more of be try type going on the tenants that is center what we going that what smarter successful. And traffic, it Brian's more data help draw highly the you that we're of to bring underlying expect respond traffic highly company always tenants team that our serves. in that also bringing use And and to to of tenants smarter is you're on going

tenant levels see broad higher while shopping will space. uses not well be this funnel in centers. going concerned work of or wondering the bright so we're our potential about will the not backfill would that to And we're and failure, we We're how disruption of

in We're approach there. being more to taking. putting the and we're we're obviously to of capital that work terms more the disciplined that's sure going credit that make be is So to that

dispositions in those you terms then can pre-COVID? the quarter, And remind of in in progress were the two us

bid in was. that vacant One an was line with And shopping some we them the had of bids was sale center them one a opportunistic of that where seen pre-COVID. a had of highly we of

the color. for Thanks

You bet.

from Caitlin go Please Burrows, Goldman ahead. is Next Sachs. question

for This on is Julien Caitlin.

guess you? year-over-year think I the does for So basis trajectory feared. surprise And shop your better declined of and that is is guess outlook first XX points than sequentially occupancy small which going about bps I small forward? people occupancy of leased what XX increased kind I only shop

part and it failures. the tenant making doesn't goes it And to surprise point earlier Julian in was us. I Yes around

yet seen a And We come. haven't about backfill tenant could you they huge failures just comment will of we're thinking but number Brian demand. of maybe in terms how the

to tenants to that it we about four sign or leases spectrum mentioned and Yes. leases I during goes with. were But with did point. able talked signed One we the quarter. I really earlier that Julien the Jim's of had uses as many

seen tenant we happen do that yet. failures We year. expect through those go haven't We come through to the as

of But see cell users, the negotiation I behind and that if fast backfill. were be it we that to consumer down. surprising So expect terms food continue number to in mentioned tenants demand the I category. in uses actively active restaurant quick see in with wouldn't serve electronics it, other phone spectrum came

do failures moderate tenant So come the demand is there that through. but to expect we as

it. Got

guess I in going tenants? be sounds And shop expectation concentrated probably to tenant your so it small is for more the failures like

I and think format. both it be large would small

seen uses. relevance to bring believe that large for we I think more in relevant good occupancy takes the small better while high-level a that thing And of crisis through Net-net just we're and it as we But what a before seeing and that's to yet. can work earlier through that us to its portfolio. haven't concepts perspective a tenants. about going -- And from question your with already demise way accelerate we this we're shop the the play to both see we're losing tenants crisis. is anchor

so Thank it. Got you much.

You bet.

JPMorgan. Please Mike have Mueller, a go from ahead, sir. We question

quarter still low you Do hold big being about think the Jim Hi. write-off? you point quarter that talked would and second second straight-line you comment earnings quarter. charges debt the ignored a if true

which well really some the in I in not straight-line the And quarter, as the first referring And reserves second more that but write-off became reserves we crisis only remember we've combination quarter of both that we rates being. things to Angela? a ultimately think well up those with cash charge, I point. number failure the as going to tenants But as low think took was taken as debt we'll rent be the taken. to took the a the this excluding what apparent. a we've the Yes. is end of see we do basis, also

Yeah.

I think said, think that's well that's Jim. I –

I line not some based momentum talked on rent continuing think all that at considered, expect earlier looking the signed, commenced to and about top contribution. good I things but

operating course to over the the of think I approach Continued measured costs year.

that deemed do continue a into we rent as fourth I where to where overall. that ultimately number think positive going is recoveries and collection uncollectible So And quarter, forward to on depend be the lands the quarter then revenue is third contributor. move heavily ultimately plans

that's what eye on. an we'll be So keeping

Got it.

Thank was That Okay. it. you.

Thank you, Mike.

We Golladay, ahead. go Capital. have RBC a Wes Please question from

everyone. morning, to just seeing tenants with if more be outparcel for demand are willing drive-through good Hey, I'm more an curious, outparcels and capabilities? your if on you're the

We are. Brian?

have banks active Yes. it, been been with very the of again, dialogue tenants, mentioned, few very continue has And Bofa you we I very active. Chase Chipotle those a active. saw have to as

we've terms to that, agreements even expect to our things the in deferral been opportunities it's And those accelerate discussions. So that. program, one more able that, outparcel outparcel in of of unlock we the

we've what able of push demand unlock to that to be these we've because able conversations. of forward, seen the been to we So continue and many expect in

unaddressed are have signing of being negotiations actually opportunistic looking at and leases with you not that are that are maybe approximation doing with rent, and longer then the new that of actually are the of it. Okay. versus then And July an those between just you're into just tenants Got split do you tenants the XX% still that parlay struggling some paying?

Brian?

Yeah.

them. that bulk in to on We're tenants bring get XX% during just in be that that they out sit with out more have basically the their then, basically category reopening that's But really the is there that we it been for restrictions the to deals is signed reopening California, what's And down still think reopening, restaurant certainly, that's many them. don't at we'll number, it's in pushes in have those Jersey handshake to primarily of look in far place businesses If New entertainment expecting working XX%. of the to to the And touch table. what And we're XX%. there, here that Many out have yet. That clarity so when these challenge on some agreements with able seen in as have it's resolution. month. with those on the and clarity there remaining clarity that we where businesses. We're of we've you brings XX% fitness the and their number frankly a tenants

But so – be new there leases some it. doing. Got could you're

business You're wants – some doing new people

Yeah.

with been to In terms signed that have the have not paying not be not of new business, we leases clear, have any – we new tenants rent.

Great. Thank you much. very

question We Floris Point. ahead. from Dijkum, have a go Please van Compass

view in they – love are not transactions you you that. guys. in your see get assets cap now, go for up, And going on right in are cap your what are is do moving rates things I morning, what there the are Good be or of market guess or rates Jim many assets your Question, but looking Hi. some do to you on the type commentary on on that would stable, offense they when staying I'd for declining? for? also,

think we Mark tenant than to comment. for a underlying platform of it on opportunity us it's level actually issue – rates more issue given are. potential what of NOI I our But now, where the Right have an demand. that, cap and think national underwritten and I I going be source to visibility want disconnect given an much of huge is is

they environment, level, an NOI maybe have unable color? to platforms I as to can capitalize going that more get cap Mark that give certain back. But forward it's are So tenant we're space you think versus and on rate going really failures, some the for

Jim. Thanks, Sure.

direction. think marketplace on said we bit been earlier, cap comment pretty to has do the I slow. it's early As rate a

I some said, seeing shoots. are As we green

quarters. I think it's have over more we next early the little a so couple color some of

to past. our similar be we going we very drive in market, to what looked take it's looking to the can advantage to acquisition that platform going Where we of value. for As we're far the in can forward as assets be to find what

one some I or we'll San at in done look of couple go value-add had last the Clemente think those see deals this of the over like where down forward really environment. opportunities, as new we true you the one years of the Venice If more we've in we into

modifications? modification And that maybe as to a you've benefits way for result question quantify the of of been some me. those you Any follow-up able a can achieve

Brian the question. risk getting where on phenomenal that et sure outparcels great in exceeded value that of or circumstance we deferral will deferral, far we restrictions, part it. team value time every job a the terms that were of making granting were if and as credit a you And cetera It's that we have done additional the Brian? of lifted were taking in

able extension have number, really value you an about even if we in about think of value that these a place to aggregate tenants. with across X-year had the than more don't that's about. and Floris, do if It's portfolio think the we outparcel, we're talked Yes, a of you Chase a but number the Bank

that was is win-win getting of the the agreement that proud we're and part of the we're justifying of value cost team coming deferral these really and agreements Our the principle discussions a from the beginning of that strike see can tenants, it retailers. with you of able with come terms the a you opportunities new number we're new it that out outparcel see And in of deals will this. and our to to

in very agreement -- type doing. a we've it's been We're So of value. pleased that and this it's we're every getting

guys. Thanks

you. Thank

ahead. The is go Vince Street Advisors. Please question Green next from Tibone,

how I hit? changed color terms little morning. a availability since the pandemic share Could debt today? Maybe more Mark. have just loan question good Hey, you secured one for on have

user secured a not debt. of really we're Well mortgage

use continues slow grocery for we're market the where not a some at say majority six and place deals is that but aggressive I would be still again, as pretty it's some not on really line what financing we're isn't ago, quite with what experts experts a product you're market. still But strong. that in retail it's don't the to not you that But acre bright So of a is, it's really we're we're seeing very so hearing looked get as months something -- in. done we that's that often

of No trying lot secured potential read use mean rate your buyers through that debt. more cap know or value I because a I to the was moves.

read-through So like just is still in on provide XX% or -- of maybe to terms too it LTVs more XX% being -- LTVs? even or thing kind there any definitive quantify to is can today, more down for XX% dark any you COVID before too of

land. I you're still the think this to going anchor it's to and guess rates normally it's little -- more down but pretty see attractive see word leverage where the deals overall what comment to it's it, is you used I exactly But get I where in seeing to most at grocery where look become dark spectrum when you on we're financing conservative. it you think a and the can you get market very similar the early lenses risk that's

it of think do back what but is fair ultimately that view underwritten? in than gets a take of may to which are they impact out it's this being going point the before did conservative lease-up lenders I other to NOI risk to more and types LPV, Yes, environment

tenants structure Right. agreement thus have sense. discuss quick you with more I Totally and the One you me. deferral typical makes appreciate payback just period that one for color. Can of reached the far?

Angela?

sure. Yes,

some the average over impact over on a a spread deferrals, the between because you months see structured time been deferrals they've two as -- in and three which bit the months. an over some have been of of statement longer The example little that four financial period. -- period terms might In month cases, it's two

back expect are pay three months the four time XX% XXXX. two by of where But to total the So will deferrals we deferred average to has continuing of the all of rent be that months. for end paid on been period tenants substantially and

Perfect.

XXXX, fair so hit it back cash basis more cash not getting flows. to is a from most I'm would focusing the cash paid or the XXXX on of deferrals in say So

it will -- is likely majority XXXX. in the Yes, likely show up

that's fair. think I

Thanks. Great.

Vince. Thanks,

a Scotiabank. Greg McGinniss, go sir. question We Please ahead, have from

morning. good Hey,

of to. the Digging bit failures. the basis to what switching tenants mentioned to of So QX finally, from tenants a given comment tenant is contractual again cash in And I that rent now? Jim, of higher what is is of basis apologize actually What paid the that But need the reserve rent was shifted year? since has level can cash basis how of if expected I this you into you then percent And total basis much and a multi-parter. the beginning from And accounting been of and tenants? the over rent to level percent rent accounting cash me cash related tenants July? go cash

I need got It feels multi points. a I all part. break out exam to book the blue little bar like and question, make sure my

cash that the But basis. will over you For a you important those basis. tenants rent you in provides of accounting a don't what is what's I collect to to cash it basis. quarter, term XX% detail took the where the provide related to a reserves the the obviously, we that of see don't cash to we that the that is overall tenant prepared lease percentage that take probable balance think took we're tenancy on our on of

we and that assessments. be of do for account et basis. view can reserves accurate when to of made in way as detailed specific a additional reserves went sure make needed effort on proud move platform We and to the real were I'm entire Is that that you we and things a appropriate did team where as ID we and getting take analyses, of course as either taken. led tenant-by-tenant, the those quarter So it Angela that cetera, the future across liquidity where to we types possible Angela?

just reserve you out Greg. footnote reserve COVID talks this of break the in point cash against X, to specifically the the does supplemental questions which basis rent I XX, Yes. of added On page we mean, couple a about to embedded quarter. attributable there, like base the disclosure, I would the tenants. to the component taken

related million tenants, total taken for cash so reserve rent million $XX base to substantially basis the $XX.X of the all of the portfolio it. against So

tenants, more doubled cash rent attributable doubled a or terms of to little was actually second for the collection In base over XX% almost levels the that for just than and of July. it the quarter

in basis collections from So closer terms to you're up cash rent July. XX% of in tenants

And the about setting clarity. Okay. the quick Thanks just reserve. for follow-up talking a

So that be? in less it I'm books, reserve with seems curious need the set to reserve since just from QX you the more maybe collection the closing increased or when than if conservative you

across the in I cash reserved collections the exercise This entire all through I lease-by-lease across we're have Yes. process the I what's as in we tenants on terms to mean, be as that we we that the were the hard about subsequent tried fact these the as sure remarks, prepared portfolio. all that accurate could that Based sure and make quarter make complete of would just XX% we into say, that reserve. the we're and in to is occurred to knowledge on that sort on now brought based really And we the setting of in additional comments went amount, that now deferred Jim we worked of made a end this of process. described analysis outstanding. organization my

and appropriate those that's But still the again, significant reserve amounts I think, feels pretty based a environment. balanced on pending. certainly around current

Yes, Greg, XX%. that's X-X,

you. Thank Right.

bet. You

Tsai, Linda Jefferies. go question have We Please ahead. from a

and going sense helped loans to is much funds payments of degree Any your rental to PPP a of the source local have this forward? how which Hi. tenants

how tenancy it. particular. think, meaningful have our terms don't I our in across was We tenants of received of shop it in small specific many statistics actually

a tracking tenants is, I source of have. they to don't think seen. those income We And though of though going rent on it's huge thing which have the going do been concurrent rental course first we've forward. we be

to think the going I forward biggest source is reopening. businesses going income rental be of these

And reopened Brian those businesses remarks, in we substantially that collect amount yet. we yet So, are related said have alluded as reopened. fully haven't the that his XX% to to at to

better about impact in percentage you the And then just look if factored start the you and for of and as do And feeling how also you AFFO? then, would if your that dividend, deferrals outlook target you the of factored normalized ratio impacts deferral? would a yes Angela. level – what reinstate one in of Thanks. When

Yes. I mean thanks Linda.

target the ratio how But by the of I possible everything those the we terms including we're things of put ultimately collections. of is. decision. be in this the all can factors. encouraged platform in different on as it's will emerge able Board point as remarks, in about Jim you to ourselves deferrals, terms a board-level going position of some think, of is as portfolio. of to we're And And that. think crisis to I number about factors And and dividend terms depend our doing his in from a resiliency cash think we out the share on this prepared importantly, as the portfolio on what level of at and and specific we've a not right failures tenant the stronger call in a to certainly, better this talked a reinstate I'm a level this the strength when point said determine based prepared lot to across fully

Thanks.

for to the And Stacey? call and the gentlemen, like turn to of end the back would session. we've Slater I Stacy Ladies reached question-and-answer closing remarks.

talk Thanks soon. to everyone everyone. We'll

This concludes today's conference.

this may you your disconnect your for at time. lines You participation. Thank