Brixmor Property (BRX) 30 Jul 242024 Q2 Earnings call transcript

Welcome to the Brixmor Property Group Second Quarter 2024 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded.

I would now like to turn the call over to Stacy Slater, SVP of Investor Relations and Capital Markets. Thank you.

You may begin.

thank for and quarter Brixmor's operator, call. conference you, you joining all Second Thank the are Officer; call Executive on Chief me With today Finnegan, Executive President and Financial Gallagher, Officer. Officer; Jim President Chief Steve Operating and Vice and Brian Chief Taylor, Q&A. Vice for Horgan, be Executive Officer, also and President Mark Investment Chief will available

inherent as Before we may everyone assumptions forward-looking to in that statements remind are contain statements. future filings, on and of and certain uncertainties no any update some materially. results begin, that let risks subject SEC our may forward-looking to obligation are described We me today our and based actual comments assume differ

will in the Investor regarding to and these we measures. measures on today of the financial supplemental GAAP disclosure reconciliations non-GAAP Further our are results website. earnings of Also, our information our release available to these refer Relations certain use measures of portion and

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

If you please re-queue. regarding questions have quarter, the additional

it's pleasure to Taylor. this my At introduce Jim time,

Stacy, everyone. good morning, and Thanks,

results continued Before promotions. our on put, well-deserved begin Kevin and and Brian, to execution, Helane their to I'd Simply done. well by speaking congratulating like Steven,

and matters people team that tenant continues cultural that a our out. in a plan. industry, blessed team we quarter company, in the as balanced we As value-added foundational with to matter At are outperformance great but real Brixmor, is execute more. estate great even the quarter our best deliver

effect capitalize embedded portfolio and of opportunity. and the quarter. record again, renewal our new we spreads transformation occupancy flywheel the record to Once mark-to-market on and ability Speaking in highlighting our the records, achieved of

$XX.XX. a rents place average our of we versus in foot fact, In $XX.XX average of

visibility million next over we not excellent signed Importantly, of several million. commenced continued while as those paying ABR, expectations, an quarter, rent top the our commence ahead leases Again, growth commenced replenished but providing $XX on $XX line of ABR to the additional in quarters. also

growth top margins, X.X% that largely same-store drove of quarter increased year balance growth our by performance in drove FFO CAM operating the line exclude growth. of same-store penetration in of growth, most as driven fixed and revenue the when Overall, quarter the in growth the in of on line you nearly of delivered debt extinguishment. X% prior that bottom gain That turn, occupancy

Even with range raise year $X.XX of will midpoint. to at bad prior detail and this recoveries in moment, expectations higher to to of guidance a levels of of the increase FFO as an Steve lower led further a outperformance $X.XX, $X.XX debt us our

delivering over to reinvestment the front, million incremental $XX we On year. full putting excellent make an return the $XXX to on us track deliver continue progress, X%, for million of at

of reinvestment called 'XX restaurant an also for 'XX Brian XX Naperville in projects, and $XXX district We to beyond. deliver that visibility Orlando, projects provide million commenced in pre-leased million outparcel second including us underway Pointe These exciting our in and with will to million at continue $XXX discuss will that plan we further. phase $XXX other a excellent Block and

during immediately an closed ownership, into a $XX in that identified on one highly Island we Long adjacent groceries we've the million recycling On to several is barely rents. box month the existing quarter our front, capital just And of backfill accretive at a centers. to acquisition empty

we moment, to that XX% of grocery-anchored our grocery other opportunities over and Brian highlight overall continue grow to these percentage organically will With in a ABR.

manner and value unlocks a cap yield and in compression huge that Importantly through rate.

leverage our Further, to fast-growing to with $XXX coastal of our pipeline Carolina's Market and acquisition in also closed in million on platform. over forward we Fresh build value-added mass markets our in acquisition critical Head, best-in-class end, The Hilton our core Shoppes that continues builds quarter a opportunities market. acquisition the Following further on to cluster the

debt-to-EBITDA Finally, fund continue to liquidity several strategy report X.Xx have impact we we sheet for the of our I'm brought balance of our balanced to business and next as years. of the $X.X demonstrate pleased to billion strength the down to our that and over

not balanced In also importantly fronts, continues to our continued but value-added only sum, business deliver all plan for us on outperformance. positions

that, Brian the turn results. I'll call With a more discussion operating to Brian? of over detailed for our

signs quarter tenants are our a of the as only pleased attracting Jim, unmatched operators continued to no morning, of not and demand down. high-quality are Brixmor our by team to good of portfolio outstanding and demonstrate from transformation but operating rents Thanks, of be everyone. the of platform. the shows we wide well-capitalized the achieving strength slowing I'm the The we range report Brixmor delivered results in another centers

Our quarter to XX.X%. leasing with us shop shops again anchor allowed achieve in small once the consecutive for to records and small sequentially activity quarter overall during the growing occupancy XXth

leases, as pair are results our growth leases, levels Jim the also occupancy new record new renewal which over highlighted. the Record in renewal to rental in with also rates team we across both growth which evident enabling and push comparable higher to of quarter our renewal XX% XX% was in executed XXX our leases achieved in

with new North As along Boot Greensboro, encouraging HomeGoods, online Wayfair retailer as more store results another lease these yet that footprint. tenants is physical company's the a having encouraging Carolina, House, we with deliver Barn, in ULTA, with. even and Rally importance first of them are, Tenants the recognizing the are what's like Skechers

in-place the speed once Market have below-market in during quarter a leases Farmers location can rent, capitalize close backfill our at and We grocery-anchored at also our Sprouts grow the to the on them. another in demonstrating we triple Knoxville, again that Tennessee team which our percentage adding Conn's to opportunity proactively continued to the

Houston few portfolio. at are historic well and Raleigh when boxes their these us the on to better in markets backfilling way among come is rents. time back tenants is with a The for are our at expected Conn's that higher box team the And spaces lows like to vacancy to at

we to Block Orlando time fall. and X highlighted, center excited million Block accretive most very to the as Companies on second online Briefly is later the includes open transformative grocery-anchored this $XXX a shopping of the great the Orlando suburbs complementing point XX market. XX component Pointe to in at at in And quarter, the Cordish partnership at of we bring live projects of restaurant by are Chicago. the in the what the of desirable of coming suburban Phase Chicago prepare with pre-leased the perfect led phase redevelopment tenants on in during one mix well-capitalized Jim on Pointe reinvestment expand

and demand, grow despite to we records which forward and encouraged in Looking continues the we legal by remain pipeline, of forward, depth to set the continue retailer the occupancy.

as to Our team us Steve on laser on converting rent-paying be future will growth. continues open highlight great quickly into gives further focused visibility tenants demand which this

broader the handing and Before the There the Helane team a Brixmor, as been Kevin Board business. Jim call be thank congratulate continued their never better team And at to the over the opportunity to as for to their him, Brixmor Steve, has Steve? support. and best well-deserved in time and for President work promotions. grateful well serve to would like with on I'm I to the as

portfolio. the of per on report reflecting and growth another FFO Thanks, pleased compelling share plan execution outlook, business I'm the NAREIT our improved to very was opportunity the quarter strength $X.XX Brian. Brixmor forward and contributed strong basis quarter, NOI growth to growth NOI build continued same-property by of reflecting XXX X.X%. occupancy driven rent spreads, quarter, Base second points the rates. strong growth same-property and improved in leasing retention growth in this within

reduced to build in tenant occupancy bills growth Chicago lower rates in expense to NOI due XXX market. and points property driven basis contributed net collection and basis expense, reimbursements contributed in the decrease by addition, Revenues In due growth tax uncollectible real XX disruption. to deemed estate higher primarily a points our

commenced our leased pool execution but million basis We despite of commencing the and with only $XX entire continued pleased which includes totaled $XX pool quarter. The Brixmor the base and decreased rent $X we team the of approximately annualized new are by spread of million million as net not size very with million, rent. build in point occupancy, XXX the quarter $XX a the signed ended between

the expect the and of vast commence commence assignment majority XX pool over next to We ABR not months.

annualized with and bonds quarter debt million EBITDA current June to we basis proceeds leaving billion, access X.Xx, had us flexibility bond markets. with X.XX% total we capital XXXX the the execute XX, on June and well $XXX positioned of liquidity balance was At matured From January offering. our repaid sheet opportunistically plan in a the a perspective, our our from of to our business that to $X.X on

rent as -- the XXX commenced X%, basis year. portfolio, in in of the strength from NOI increased pool but comprised a XXX design, of range forward have continued growth base half terms a the to In rent from our outlook, we rent contribution point base our accelerate to same-property of X.XX% to given growth of not commencements the second

Additionally, NAREIT the range prior to our uncollectible. tenants improvements year we for revenue $X.XX uncollectible outperformance to of same XX at have to quality per to property We a FFO expectation, XX in XXX revenue the the credit deemed raised NOI now points. In XXXX end basis with of conjunction of versus drive XX and of strong expect revenues guidance increase to $X.XX payment our the basis in to share. range the trends to our deemed points total continues

Brixmor team CFO the like would well supported me who way. and along Board I the opportunity to thank as larger for the the as Jim

I'll And operator turn with the call to the for that, over Q&A.

Thomas question first line Markets. from has Todd Our with the come of Capital Instructions] [Operator KeyBanc

everyone on their Congrats promotions.

just changes capital acquisitions if company's C-suite we capital the in acquisitions. raising company's recently? at the the cost around I wanted in position either in some recycling given just question, and any of forward, to as wondering here I'm all the about given capital change improvement and/or and/or move of First view more the ask there's toward

-- Jim. think I it's Todd,

I the has that the opportunities seeing. we're change honestly, been, think big

company. that So particularly clustered transaction and our huge to we're our in core activity create And we the out to successfully think those value direct we're the markets can pleased always seeing there be what for market, with where in investments. going we're opportunistic we've

acquisition grows Market we presence our which in market. the Fresh further of example, For in Head, that Hilton Carolina mentioned coastal the

that pleased ability So with the we're opportunities them. we're and our execute to seeing on

acquisitions in acquirer And about that today? for year? Do half you being sort that second anticipate of you're you're the the net in can underwriting going a you seeing of the yield talk

what's Jim of appear in with more a the mentioned, Yes. few conversations really direct months. couple active upon finance to source Frankly, that Brixmor a of to we ramp market this as even debt is the venture is opportunistic more seeing certainly sellers we're more interested like side. folks that us with transactions or we're on joint quiet that over respect a external be last activity relying going about market to deals today the And Those active acquisition to always with to Look, acquisitions. kind acquisitions interesting aren't frankly, leading seeing market or, most capital deals. made really the much be pipeline year you're

do more bit half. we acquisitive be the expect So second to here a in

mentioned as in Xs. balanced bought the we be is yields, always respect our in over acquisitions. deals respect with the But allocation years, Jim we With high where on will has to to capital year-to-date, discipline the

at our realize type in opportunities think important cap our when look they rate whole to a range. about high perspective, X% that we so investor. in As same we are what's But going IRR the from also are cap recycling, yield, is forward you

selling those we IRRs We're pretty look assets between the spread at IRRs acquiring. and we for we're assets So we're seeing sold. on the what a that big

Okay. in versus of mentioned, terms going taxes sort think how lower onetime the quick, forward? of And recurring the in net about that Steve, property much nature lower as the what potentially that quarter related recoveries of was real taxes might more be to you in helpful. That's property we

Yes.

million the $X XXXX. related you the builds I about of think to of sort total is -- look when of it impact in arrears the way related Chicago think quarter, about

ultimately, And will us it's year of thing then the and with the allow So million cost I remember But aspect. in important to going those recur the in renewals push lowering recur our tenants forward. the our that that's on and to occupancy future. nonrecurring to think will sort rent is, about $X.X

in million That's annualized Okay. $X.X basis... quarter million helpful. or an $X.X in year the the

million. $X.X

$X.X the million in year.

Okay.

recovery only from occupancy would The up. benefiting moves we're higher occupancy, Todd. build our is, thing as Yes, also other highlight there our rates I

as So we the quarter tax you drive in build and the generate us should favorable from while better benefit to we margins. recover more expect did assessments, continue occupancy,

question next Dori the Our of Fargo. from Wells Kesten comes line with

those? G&A Can us you along of may sense with come any give a incremental that

efficiencies. other don't balance, look we as On incremental we expect for G&A

on where And out? Okay. backfill? note to or rent Conn's spreads shown of irregular and And just potential about then TI interest Big those may kind retailers and anything pencil have in to Lots, what timing spaces

Dori, this is Brian.

first, exposure that those sorry, the may of took And as rent. backfilling in open-air Sprouts able tripled about, back the I low in we continue tightest supply it a XX grocery Conn's environment and that as put were of in pretty are first to like the in apparel And in about space with that it's types seen. the segment, like Just to tenants points. relates to come the the the for these them we basis to proactively value talked us tenants boxes specialty that types segment, the we're Conn's back where expand we've us the

below spaces. a in those Lots been foot double, anchor signing over particularly, got We've not Big the And it relates leases foot. rents lot you a around we've just $X the year. -- expect level those are those to can a relates $XX to as significant of similar it but rents, past maybe amount a upside, big As signing been particular, we

terms again, it's get to the this encouraged the back them box in we're few box supply environment quickly a of to address very feel we we've lot as getting of So a back that ability we extent and our boxes year. not spaces seen

line with Our next of Craig come question from has Mailman the Citi.

know NOI like guys on ticked getting everyone, of on you -- I there. of I to to want go leased small on are Jim, questioning the shop. to end and again, back seems record your but every about you margins up for XX%, kind promotions. Todd's Congrats anchors it quarter, guys the just another occupancy

to shake year over think continues pipeline portfolio about? should portfolio fixed you do your normalized the appeals. some out X the margin next you a on what's some tax commences? guys better as think get pushed to level as Like CAM, Just outcomes grow, through Where NOI new good or for this you

Rather build than points few is as see you hundred going occupancy leased I a XXX as got and margin, you're point realize us continue build. of giving think to on out, a difference there you grows a a I guidance between specific our we've think room. And basis to point that, basis because

of percentage that the the by be which, you recovering as a going portfolio. and So is fixed we're that also CAM occupancy we in higher delivers, mentioned, obviously, to as augmented higher have increased penetration

I do to in growth see So expect continued margin.

number I I'd than think we hundred few have give more not a a rather basis room. specific points you guidance. for of

just And of leases in intentional Craig, team I our has eliminating CAM been carve-outs. would our caps, very improving CAM add, eliminating clauses in terms

understanding we and at deploying with that the been You good across mentioned growing intentional been been We've very as shop CAM. a both have that We've that the across at properties. small fixed where We've we've been -- well is anchors. trajectory X% of portfolio. expense where those

been is base rent helping on doing we're everything really of terms which front, to well. very margins CAM the improving our in as those addition clauses, in intentional So with team has

is I sitting we we don't look some And think about last we thing are ability large do hit folks they lot topics Brian of of have on. to owners is margin from Craig, as at we that a would acquisitions whole -- the who buy those add not when institutional like the are, acquisitions,

that So we also side. a of in the buy we acquisition piece growth think that's the deals on

for you're kind on of you -- softly that high of prices then guys is guys pipeline and of with of buyers have marketed all the are the kind are am fully the maybe or deals. buyer who Is market compete on that's going bigger acquisition reading I not into better to where of get kind That's recently? gotten Jim. more less been paying you the guys to deals, net have kind the recently It maybe off correctly other cash marketed people or that sounds more opportunities of like just of or and helpful. worth And some and sticking side Mark the

and of marketed mix to off-market. deals continue see We a

point, on, growth by our in markets pleased advantaged that meet are our the Mark's think this liquidity given the position. buyer that is we're I And that gives hurdles. and we're pipeline presence a in in capital given focused overall an the us environment that preferred though, markets that return our we opportunities also seeing of just we're

Our the next questions from of McGinniss with Scotiabank. Greg come line

pressure that in handling when tenant up? facing you healthy, art, goods remains still certain obviously they are and some how tenants renewing quite home So pet Are expirations are category? categories office leasing but and those supply. Or like come you there

this Greg, an on I individual mean, look at these basis. is we Brian.

Our instance, are There considerably. supply positive our X-wall supply still overall doing that in our EBITDA that are office exposure portfolio. -- are office well very for dropped locations has

think that So locations Staples we've of in renew, doing some those of back proactively do we've Grocers been the folks other likes of you and Ross the and backfill about particular but lot a with taken and with. if that some business of

going So pet we're this in number a we see we to then very at got be do of think it's spaces continue category able higher upgrade lot to store our the rents. center And tenants have a going that in be to to particularly continue well. where locations demand. be And weaker to environment, I We've specific. really anchor those any to on of really side, opportunistic do where

very $X, those over We've at them signing in rent the at next to low on expiring terms got basis have $XX. close expiring few we're what's also spaces and years. a of We rents

the any in it category, the to depends on we see going really tenants we're do where use to upgrade. weaker So opportunity but situation,

information you backfilling not are How be productivity, about of specific how or data? them or boxes, placer go their a you get you to you going proactively filling? evaluating or kind they're do And kind that might location sales need so if higher about of deciding from for risk do

We lot get tenants. smarter. mean of the our the certainly portfolio, get a for I be helped majority That's both. we we and sales traffic get all do for us

the get thing is with is that's we'll side, and we've account don't trust of reported conversations of other that's across those tenants, our The the relationships we the platform, team got in number get where conversations our national often tenant, where sales, even great our and on volumes particularly our built. because with a

renewals So you're tools our or whether traffic, adding coming the related we other of sales from we about, again, to we up these shows also that's as well. the do and volumes trust getting talking get some to bulk with the able today. have but we're when not where relationships some that's that utilize Placer then those leases we're of that whether in And that really retailers tools also sales we where tenants. sales the reporting have We're get

in see environment as us space a to great due. for And We're it supply-demand allows it outcome optimal the drive in comes spreads. that the you

the see spreads as renewal as spread. new the in well You leasing it

taking we're to quality, numbers. continue So to using also upgrade growth, portfolio in the organic and tenant only the drive we're and it's opportunity not this upgrade it true to

of sales just are that Okay. on? Brian, box stores final the store or what percentage many one of is, the And how stores individual getting you point big on

size grocers We for of all of and across about almost XX% get the We sales ranges. from our today. all get portfolio XX% that's it

that particular reporting have are add has that today. we've reporting up. the been of percentage as sales But number come improved anchor able So I to as tenants sales don't renewals again,

grow. to and very expect about So intentional to that, we've that been continue I

understand accountable alluded is where isn't accounts And held sales required. our team as Brian reporting to, national to productivity

for a only terms a underlying supplement of productivity, renewal. not the when proxy with tenant also which good the how you you Placer economics AI the So you you sales understand have in helps of pretty which great but upon drive health that best is view, traffic, the data

Sandler. the come with Alexander questions next of Our from Goldfarb Piper line

one guess, questions, question I X one follow-up. and Just

the on to area. food their for going especially -- news It's common in back out pushback. consumer McDonald's the other, a of sort tenants, On the clearly, been with theme

their not portfolio. an concerned talking really of changes and Are you Or within in on any -- a and update bit this consumer little retailers and you're your patterns? reallocating people what seeing these leasing? overall, purchase are in just different Just affecting the retail way it's categories really each shopping that business across about is affects

by decision is driven leasing not long-term performance. a and The certainly decision quarterly

to As looking retailers their are at stores. committed 'XX out 'XX, and they're pipelines and the to the beyond

actually As traffic very and in And improve we it execute our to look how do are opening being major strategy. they're within hearing terms continues those The at that. pleased where contrary. their get our as at store our from in we we real-time very our posture traffic filled centers tenants, tenants we're really with aggressive to centers of are and a still quite trying to the to tenants plans they're data,

Okay. a the the gap small of versus boost a And increase shop we get just the follow-up just because guys. looking XX,XXX to but more sense a bigger shop increase the of feet? basis is impact in Just with your a as the feet. to impact shops over occupancy economics And how have Steve, the XXX leasing wider basis under small much you that presumably, lucrative for think about advantageous smaller the FFO you it's yet XX,XXX give to from the earnings to not the from to signed is, more square can that's a XXX should in and occupancy point then from your increases. shop, at trying square sort point commenced, believe the

pay a think anchor exact mean side. to that I can are quantify a on going contribution you than your have would rent but input, right? I higher The and higher the shop I is general thesis recoveries Yes. know don't tenants correct, to smaller I the

shop. when at we're the you on rents small achieving look the And and both the that anchors average follows through

$XX that point not Your that a is correct signed part there's million but that's rent. of commenced multiplier of greater

Goldman Sachs. Burrows the from come questions next Our line with of Instructions] Caitlin [Operator

another occupancy on of impact improvements. pickup just Maybe the

is in quite the quarter You occupancy about snow talked still good had and pipeline the in pickup how large. a build

the pace of So and we or what's near- maybe quarter? accelerate your build of even Can from openings for medium-term occupancy? continue commencements to saw expectations sort in rent the what

Caitlin, Brian. this is

normally the late of as those of in You continue to of we occupancy kind the happening back openings fourth would build higher the third, quarter, particularly to bulk in year with expect half have trend the anchors.

on next have we And the depending a balance encouraged with even demand very those on be at the size the these to continues you of shops. end just number very a to in and we into get closures we depth billed coming fact may leased the of Now spread we if head online see occupancy in as dip build, of be store pipeline raising the as despite that But just normal the and illegal pipeline We'd would And get levels. particularly strong. a to into the few occupancy again, about that. the that shops between trajectory we're the and year-end year. back, We're the course of small the year. start talked

So -- you as expect trajectory the but the we the balance year. rise overall, through to that go to see should of

Got it.

Okay. And pricing. one just another then on

related the I I time, long and been do for can there today strong very not leases was new a options that a renewal side, anything you level. eventual do signed future? record the Or term? is anything really limit can The from your in the have and have spreads the more quarter options? you strong. may is is guess to on of it near you they kind pricing of or So impact to drag also may And is very lease option the this mean,

and and fewer been our we've executing we've giving to focus as plan been on successful, the began, Brian we that. Since been has options, very do team

only that. fewer otherwise so that's occurs you execute the giving And fewer and not giving portfolio. situations time across required. where and something but It's really options not over options And options as that impact how fewer you they're

too, incremental Caitlin, I would And progress. we're just that add, making

those XX.X% say, where right? to to In tenants To from, You options or number option anchor in increases anchor past -- X our maybe anchor them option, pushing were eliminating maybe only point, an team XX%. give and the this with to Jim's you're XX%, environment X. of is have

The almost we've into primarily California that much And no tenants. other giving we've parts done had our something options is thing national Jim's with concept the other the that introduced market to tenants. those where phenomenon on. local we've value pretty point, country fair was is with very to it's a of We're team give focused

If were Gerstenhaber. question. and committee here a of leasing, you that in sit on to a asking Friday our He's David head

As you something So while. reduce you doing focused option? into on, Can do have that deals to going something give options? we've come committees, it's a those been continue we're but to to remain for

BMO Our from Markets. line with of the next Sanabria Juan questions come Capital

or the half. the Just with us a question just second are driving what's second slower guidance in the regards Obviously, color to the key range? And around variables same-store some give details NOI half? Can the guidance. you what there's a slowdown assumed within implied

in see year, to NOI it guidance Brian was starting commenced basis half think when same-property base to that XXX is XXX Yes, the see really what of largely of of talking not to up our XXX that got think ramp you signed contribution, and rent to contribution NOI to pool. basis growth NOI. growth. on sort point point the you I the was dependent first right? within first implied about same-property ultimately, gross you'll in base rent, the And think for the going about same-property about be you the is the thing the Because just And

of benefit revenues tax timing first XX points. that call from was our Obviously, We half in of expecting a expect estate the as we real on get of XX basis back be year did the to of as percentage a the back of total year, to XX and that we to rate headwind bad points. a talked last half that, we're to run collections what quarter the just debt the basis be total to

base that a that of line. rent in sort the of and acceleration deceleration the the lot bad debt you're think is offsetting I So seeing

Okay. the pipeline. Great. And then acquisitions on just

in think I comments. the mentioned $XXX prepared you million

Or assets. of Just curious of grocery-anchored kind of pipeline Are on curious centers? assets? the you're traditional to today? the on set more with they larger the kind what's opportunity neighborhood seeing regards types where smaller Just in

of in in is we the year That first part bought -- of first the pipeline assets are than the in what we Yes. year, was half because of larger smaller. half what the bought larger the

see look our targeting meat growth, of time. quite sit the So like for they really that and been a portfolio. for where we to strong footprint, have within there acquisitions are a of assets importantly, some it's assets truly lot our we the And bunch those ability drive

we're excited existing And we're to beyond about the seeing as the the frankly, continue dig to deals pipeline existing across try pipeline. out So in we opportunity country. the

And just a greedy I can little be if here. more one maybe

amount data sales comments You given the base about slowdown But solid Alex luxury retailer retailers, increased talked both foot comments cautious any by across traffic and your about sales. you in portfolio? that made and the seeing the being on having more retail of points from low-end retailer are

We're not.

Our Van questions come Compass with Dijkum from next Floris Point. of the line

Congrats on the new titles.

acquisitions? Head question or And about bit existing terms if acquisition you maybe what on little to Maybe like is you've just Hilton you're Are little what to that centers. talk in the So a value-add of bit following it complementary you a next up done more. switch targeting can seeing pricing? acquisitions, in pipeline. mostly infill Or

bear for our and But pipeline opportunities to are type bring can cetera. better us. at core densification, in we rent to really asset kind plus drive better outcomes handle value-added growth, I'll let the we NOI where looking Mark of broader et additional platform

is side, thing finding the what can understand not we where you're above-average type tenant we we center are, playing the within really that particular the cluster be core to and we're to we're we further our seeing understand infill markets demand core investments, -- us encouraging is that attractive So growth. rents in opportunities generate market on where believe but the

Yes.

acquisitions, I -- dispositions, assets at we're pipeline, think it that we're selling assets when it's the selling going we hope we're we're growth And to when when we're think said, much just earlier, will seeing also long-term IRR that those here. we're it's we maximize where buying which Jim. at I well said and look we I better about value forward. IRR looking versus really important. And selling, maximize contribute what thinking

presumably, cap the type And to are going be similar they and Great. acquisitions rates? those dispositions

our When cap we're done we today -- we talked last buying interesting. quarter, Xs. into blended about what look we as Xs our high the what it's the year-to-date, we've at for year-to-date is Yes, into sold rate

even think out will over I that time.

some I spreads, spreads. And my spending question on but noticed, great to of leasing achieve those you're maybe money follow-up obviously, -- lot a of new then Great.

some Maybe I lower? think even Conn's or square the you about I or boxes have could but those think some foot talk little Sprouts or some do this that's how past costs go down talk persist I $XXX in grocers going -- you other lease you're if other it bit with to costs to view? the boxes that of of calculated point quarter. Or a a has elevated do transitioning and leasing to suspect in long at that will your slow

ultimately just in you're That's certainly. will leasing Sprouts say more cost to it past you quickly. back took would versus coming was year and the see the and you were year. of Bath Bed Brian. seeing the record at of on very for are They're portfolio average, historicals, a in this team has foot. this of averaged remain you're $XX show about rents, box spending last I seeing, year a the consistent we've the that last effect the that bit that net terms terms where we've the backfills so we fact rent, in a getting of the level so fact leased foot What But because we we're for of We That's Floris, with we gave, effective CapEx, of $XXX tying much example it that elevated just spaces. the last a you the what our can this to I'd the leased back that quarter. space in done, TIs. around impact point off like somewhat it talked and there. the rents it the year not record net from that is a I'm

in very I'd of terms prudent say though, overall, just been we've have for we been where CapEx spending.

XXXX. down You down improvements of will made the see trending year off. the across reflective and that CapEx, last year-end, and down it It's we've was again the our leveling versus really be now by made maintenance we've changes that and portfolio that

our highlighted. going range occupancy terms both that these and bring year existing to end the in be strong of of age demand, We've conditions, at increases, and $XXX team of we to as demand getting age like as have the $XXX year. Jim HVAC. I be to roof, the that million on high continues more But are the tenants projects tenants take really spend. reinvestment to that leveraging to more million is this some of have of much those flexible Our that point, about the your being We're talked there a

the But costs our I because why of elevated the that of quickly. is So just so much team whole, has some you'd think moderate. expect on that to space leasing you're addressed somewhat seeing so

Our Instructions] from St. questions the line [Operator of come next Haendel

Juste with Mizuho.

to wanted to a Lots Big I for moment. go back

be to exposure heard how own be I bps Conn, directly You it's in what of they than on think stores And have of their may they of space curious some parties. hearing your XX we're boxes, at to APR. those you've I'm many might looking there portfolio. looking close XX third more subleasing that

So your if any re-leasing curious to of limit from opportunity and yourself. that if and benefits those perhaps that you boxes get expect some you're back seeing I'm of to

Brian. Haeldel, this is

again and likes XX% relates we pandemic. to with the spaces. to Ross it our Lots, Aldi Lots on reduced leases here recaptured exposure We recently of since Big as the Big and Sprouts recently by just signed So prior

have did operator. great a use list. with are of We great one X with fitness the stores already leased, off-price on Two that initial were one a closure those

and back we get closures. that So store number will the as of don't stores announcing in to we it any relates color -- of have terms additional we anything look or the additional as timing

the though tightest than say ever the in is -- could Lots environment space I be back and we're boxes like Big seen. of in we've Philadelphia Dallas, supply box some markets we'd have What taking and we

in feel center We space. we center. that at we taking space for too, about to seeing by very look that those proactively we'll we but assess with demand want really the own So be ensure that destiny, control Bed good and we we'll prudent decisions the early about our opportunistic as Bath we're them as discussions, were well because

boxes the you third And re-leasing are of on parties? themselves to the anything hearing

Yes.

Bath. able I look, we see they leased -- were probably already our Bed England. we control get we're going of one And the in to value showed at think, again, we've boxes the We of that for same We were up do. to that auction. New

we'll assess already say, along. leased. And come they're were are already that I out, has stores closure just as been So -- that a list our would them on they X proactive. Again, of came look, team X already there

been and our as them potential we've hear really to be a feel relates when or capitalize of proactively opportunistic these we that space. closures in particularly So weakness and of getting ability of on confident store names, we'll ahead it recapturing number to potential

expect And were lease curious of Bed cash The if it. mentioned Bath? I'm impact you that any very then Bath of spreads in of a any Bath. just new the of flow anchor us from Bed remind high And the timing backfills. again follow-up, quarter. that the Bed you the included Got the

basis ultimately, this That's and have bulk on year. the part do starting we finished with just Baths all in have prior online. We're space really do include portfolio, the quarters that. of the that because quickly getting one is that or broad-based expect with addressing low not our country, saw it that quarter. been effectively to this And online in the already thrilled the opportunity tenant we've we're what where to started the leased team We how you cash shows any this. those and didn't I Bed next the come But with boxes we fairly those that it boxes. continue back the us we had was across one think just this rent to of we to Interestingly, expect flow. already really Well, to environment that is come

And right. the on congrats All promotion.

Thanks again.

next Jeff line Our from America. Bank of come of Spector with questions the

if at larger are just the and there look Center more leased the Andrew Jeff. is any set leased. what about Reale Market on And opportunities rate mark-to-market talk This you is Fresh about term shops? for What's expirations assets, the like? XX% near the West can opportunity at in X

Sure.

to you unlocking it's that the on adjacency if So site what And they to that an at at Center West out the X for behind plan the that really is figure you opportunity outparcel. villages. plan, -- looked wheel villages the overall X center include that's really when called

been under there. low it's couple here to at vacant the high managed respect Head, the opportunity there that drive So we you first Village box to ownership. and XXX% risk, one asset With village exciting Center sorry, occupied early behind is growth months we're but mentioned of the excited which what that's is an and of about steps I'm see is Hilton under-rented, -- in really west Center, very West and

Okay.

the and this to few also a You to pipeline projects more adding spoke redevelopment repositioning quarter.

be find opportunities. your easier to becoming if on any retouch set curious Just assets to opportunity Any it's types color how these helpful. and would that's of trending

brings. really the advantage Yes. our platform It's

As the viewing at and to lens a the through a opportunities have but value-added add reposition, necessary acquisitions. uses opportunity where team, we to we raise acquisition are really we investor look also of and rents them densify the

our amount in opportunity we've part nice significant our of the is harvested about successfully that a strategy existing portfolio. So

acquisitions we'll some expect in add next of to remains several we significant the that to continually a that opportunity reinvestment. Importantly, recent million think demonstrated we hundred opportunity as couple then execute South the we've I of And through more as of value demonstrate years. over amount Florida, these add incremental in

of from Khanal questions Samir ISI. Evercore come the next line with Our

XX months? mean list to for this you Conn's the think I that Lots X boxes. we tenant year. that I as I exposure does mean the guess, I into talked like, the Big sort next of boxes, look next watch about guess What the setup about

process by out off. move-outs our portfolio. that portfolio strong And management just the a coming low And rigorous record as of I'd ever can paid put saying in with you really as the base pandemic is that start financial the this off for paid see been. in credit We has underwriting team. it's of asset we

we've have You the Again, traffic. in off XX those of situations, can X see leased that it basis terms tenants we been renewal boxes. points. already as it low a driving growth of more relates We've better in because the one to we've are Conn's there very with drive got at specific paying that able exposure to

Raleigh, boxes are Houston The Atlanta markets. like and in great places which in are other

exposure Big Lots, And and it there to backfilling better higher been our tenants lowering we relates ultimately, with consistently have as them at rents.

ourselves spaces. opportunity to leases So some these already we we about of announced. think that next can I the an into stores think use on position it got to how continue we And encouraging this that to as we've as year, it's see ultimately are they've to upgrade looking

And Okay. shifting I just Jim, guess, Got you. it. to over

saw picking the to acquisitions even You or It clearly your have like leases the maybe occupancy to mean, I guess you I the biggest go in the up, risk sector quarter. this continues strong. at portfolio spreads we time what's up looks are think. that

basis rent a in think where our given strong positioned execution. well our overall Should given and retailer any not doing we're we're and that in but because see given largely do, outperform times rent particularly I've is. seeing demand, the are positioned 'XX out to one think as basis slowdown in, . I where even made environment 'XX we're positioned for of a really business point well you many we're our again, of, that such it's that we're the slowdown a the transformation given portfolio to And of retailers rent which we we a basis. signs

any believe general beyond ahead cycles. given out really look risks as see don't we that, I trends I and positioned. So But we're even economic major well

to and our this need to proud next drive put external improvements us we've where balance continue fixed position debt how to capitalize we billion we our several to how also overall years. plan I'm income have we a in how term to continue out of our demand liquidity fund the and our for continue no for sheet in for paper balance capital to very business $X.X sheet, in environment of on EBITDA, handled

think of about, So rent I portfolio, capital reposition structure, the conservative you the an again, basis, when think it's all-weather upside, plan.

us economic I think it's one is. climate well the positions whatever particularly that

questions Our Linda line the from Jefferies. next of come Tsai with

Just run reverting to to XXXX? rate you bps XXX bad could with range the in the historical half, sit debt the bad XX closures taking where a for touch second higher from today, debt you

I certainly -- think one it could.

quality would the the don't I . bad I Steve overall in We give revenue the through frame the half portfolio think alluded But yet what second in improvement credit portfolio. of in against debt 'XX. amount on guidance it expect year, how want coming we've is uncollectible been the in and greater to improvement I within that's And pleased the to. terms of by as a performance. the do of deemed overall

few kind like portfolio, you in your then next expect the same-store of longer-term what's years? in given your would just the portfolio over And run rate overall the strength

achieve well percent in over growth we're range next positioned the same-store the that years. think several I to X-plus

Our next questions Mike Mueller come from the with of JPMorgan. line

but quick well? any opportunities are redevelopment sizable, Just pipeline as evaluating the a here. one We is you know ground-up development new

ground-up And development by approached certain been date, haven't We've to opportunities. been approached by We've developers. tenants penciled. they regarding

risk, the existing it lower assets. to opportunities doesn't reinvest a return, favorably compare got have and we just higher in to You've our

a while the of but difficult not returns, activity. development to just to only I also of ground-up because it's amount, do any take lower environment that meaningful and in risk see higher to which of a new going type it's So finance think because

of in So years. expect increase we've material I some, couple but don't a seen the next

Our Truist next questions Kim come Bin from the with Ki Securities. line of

Just a follow-ups. couple of

past the includes getting? to projects. has relatively projects batch or your that define landlord if work. that -- that trend yield And the it remind us you next over how has costs, at potential yields, does year? pipeline. stable? just construction yields You Can on -- that added and new Is you're rents you the if a X% the couple look increased of potential you redevelopment the second, redevelopment Or And of

That over cost. level return total Yes. project project costs rent is and the level the incremental the

of actually As we're we pressure the look the some We're environment those in pipeline, in strong upward demand positive because of seeing out seeing. returns.

As terms portfolio of ]. average you reinvestment from X% overall to [ growing in of of saw X% the an

we're seeing what by encouraged forward. we're So looking

of line Deutsche from the come questions next Okusanya Omotayo Bank. with Our

quick again, and whole of me to my Albertsons add September. the court with question accelerated the developments A own case kind Kroger, team. getting latest Let the congratulations on to

hearing, thinking exposure whether how X you grocers? curious you those what changes kind Just are guys of it your guys to about are

markets Albertsons, environment, great stores supply some of where markets a overlap have Southern We don't both none We This our and in more is really fact what's scenario. some to been were do divestiture list. that by that for on have were fleets Denver. tight the either encouraged reinvested outside like and . in We the have in news. much tightest feel of California we stores the Dallas We've we and have in Brian. the the are good about in supply very report initial Kroger that been of our got

stores our these have produce getting the portfolio. closely, higher really across $XXX very So from about been we over companies both we're foot feel I that mean grocers the but than to have would merger said be continue and volumes and watching believe a good for this that good sales a fleet.

So -- invested in that the really few over here they the years. have by we're fact last and encouraged been

you. Thank

like end to floor the over back of question-and-answer session. reached our turn closing for the remarks. have to We now Slater I'd Stacy

joining of for the everyone, summers. Thanks, us your rest Enjoy today.

teleconference. today's your conclude appreciate does This We you. Thank participation.

may your lines at rest You your time. day. disconnect of Enjoy the this