Alexander's (ALX) 7 May 242024 Q1 Earnings call transcript

Good morning, and welcome to the Vornado Realty Trust First Quarter 2024 Earnings Call. My name is MJ and I will be your operator for today's call. This call is being recorded for replay purposes. [Operator Instructions]

I would now like to turn the call over to Steven Borenstein, Executive Vice President and Corporation Counsel. ahead. go Please

and these Realty most website, available under we Vornado filed quarter the call. financial the non-GAAP earnings quarterly documents well documents comparable Welcome call, our today's during discuss as are www.vno.com, our Trust's first our afternoon, supplemental Investor Securities with XX-Q certain issued on these packages included the supplement. and Commission. our earnings XX-Q quarter we Yesterday measures. financial measures These report GAAP measures as are to information of Form release, first Exchange on Reconciliations and earnings our directly and Relations section. to will in In financial Form release

may Form include Please materially XX-K today's be our Securities risks, refer be Commission, not may may for risks call actual filings The these statements, the from XX, uncertainties Please The may of including duty the accurate does our a aware a differ results and and that forward-looking statements variety call to due with and any this update date. deemed to statements factors. to of Exchange statements. other uncertainties. only regarding XXXX, made company ended more be as information December and information undertake these annual on forward-looking that time-sensitive report year for during

Chairman and Officer. Officer; today management Financial comments Executive from Steven for Chief call the Roth, Michael opening On and Franco, our and Chief President are

available Our senior questions. for and team also present is

to now turn Roth. will call over Steven I the

been We've busy. Steve, you, Thank everyone. morning, good and

Let's start with Bloomberg.

lease Bloomberg's XXXX. a headquarters foot the in the of February and on June public mixed-use Vornado separately million is month The owns are: office XXX $XXX XXXX, owned Lexington condo whose due tower, a Bloomberg next debt Alexander's, facts Avenue, XXX,XXX background condo reminder, Alexander's. of REIT. office expires XX.X% traded is by square global is As

XXXX. the extended XX-year we in renewed and to Yesterday, begin XXXX announced Bloomberg and February term February an lease we that through for us take

from So of XX term years now.

imagine, And looked you every must. in redeveloper tried town they they opportunity course, poach as Bloomberg. As at can a to of

that We chose with delighted they XXX to Lexington. are stay

creation is way, into don't of the design have the of what much building would fit-out original had par to. building Mike's But internal now input with as building. they we mine. the the significant He of course, as the are design in Bloomberg's built today. on By need The

the free more lease the subject the out then will yesterday's with The in rent conditions. rent was based of TIs than or up terms XXXX either concessions been XX% down of no filled and established have in in an appraisal the way market be form filings, adjusted and of on the tenant SEC rent rent net

for the refinancing lender, I leasing of or in We're am which the equity of are for say, I protective of paying cash such, process trappings even much not must but value. this excited market don't admittedly our about debt rate X% asset, all of but as the do with suites reserves, X% today's

the and As we the down We to maybe speak, off. is pay see. my pay debt personal shall favorite debt even

the One to XXXX, a and had lines. was reduced of last on through similar finalized renewal renewed second April $XXX with for Friday term separate lines we've XXXX. extended million, credit line been Now credit has X staggered with let's credit at billion our focus a credit but $X.XX maturities. the Traditionally, of amount line

drawdowns. repayment we dropped times, several these We very exceeded and have known out. generally lines use in our with XX% sparingly, banks a credit expected of for requirements As short-term source rarely

to guessing you date Avenue. Since on joint already much up our Avenue. XX% venture reported, Park all to partner We has own Now the XXX I'm Park pretty XXX of are significant details. the did pay here for leasing. rate extend but years, constant with What posting X loan no reserves keeping down, the of we senior the cash maturity for was future

analysts and well create win, dollar, a Park is big here. where recognize pretty on at out does a cancel the low loan there yet Avenue we By located X% a us have of million the wonderful that a warrant $X.XX quarter. We fact first-class in bet. DPO mezz the allowed commented loan the and space. much think but way, is are it's leasing on to it at vacancy which a realizing Prime and very Several very equity a cheap that value shortage gain already share, second the the $XX.X not a asset in we will This

to caps a rate continue sheet when to market, matures protect there swaps, is X% with no into interest and a place but our really We hide. X% loan balance

best-in-class continue our where for We prospect real helpful to platform in to good operating distress, the be lender. estate can

We accelerate. to expect these opportunities

the part palpable. should very to more own, retail space the than and New is much of the by control locations It accelerating and dominate gold on is knock-on best noted wide New prime margin. effect that in City have the on brands we space The retail anyone luxury be prime else a rush York York,

our Square of to seem the ago, years have to values JV commentators noted the pricing so. X Avenue Some have that seem Fifth retail sale would Times it and recovered

only huge my XXX frozen million out square strongly and tenant starts York horizon, shareholders' non-prime contrarian up couldn't in market to on a none be optimistic I more a space, you no I shrinking, annual and developer case the we also smaller i.e., much note compete made bull supply, And believe office requirements foot picking square continue basically the about cancel the really the in future. I million market. that new feet, vacancies letter when while the that XXX New has with

our Great things Come PENN take in look. and by District. a are happening

at optimistic. Our here be team couldn't Vornado more

to Michael. over Now

Thank you, everyone. Steve, and good morning,

previously last items due from we were the quarter down to As financial year that the expected, results for forecasted.

$X.XX higher net $X.XX to interest last first offset compared was by for This a no lower year's FFO from NOI decrease First driven per partially share primarily of G&A per expense quarter, decrease by and is lower move as outs, expense. $X.XX. share quarter comparable adjusted

provided our our have release We supplement. quarter-over-quarter earnings financial in a bridge in

However, due from expirations. same-store to the business, New was X.X%, NOI down aforementioned York primarily cash

As XXXX of share per of we projected of expense indicated $X.XX XXX the call, Avenue. interest our to our last XXXX known earnings higher to in primarily we Broadway, FFO vacancies the Americas, FFO from expect $X.XX at down due about Avenue our primarily at Park impact net be of per and XXX properties, comparable of certain XXXX comparable share,

be per share. of impact to expirations $X.XX XXXX to roughly the $X.XX in these anticipate We

We vacancies these the PENN up expect chunk sometime the we of won't a to lease-up this have We earnings from be trend this XXXX. as in down. impact then but other income until earnings begin of and GAAP leases temporary rates expect as from and comes to already as space leased online increase good

of New continues turning show York leasing signs market office strengthening. to Now The to markets.

upward, conditions While large office with new the set bit the market, dominate improvement the sublease strong of tenant a continues a best-in-class space transit to are requirements to trend in in leasing These quarter is activity healthy took continue number is a New our located for hubs York the the in in year-end, deals product already amenitized table space which continues continued tier and a and in leasing fall, the first of and works. dynamics of to experiencing best-of-class pipeline supply of close renovated upper portfolio. we X. to Overall, there backlog breather from

submarkets. Overall, financial are as both across The sectors concessions asking rents stable, are services but high rising legal mode. and the in are growth drive continuing leasing to all top-tier even properties in the remain stubbornly activity

to tech again of first after being downsizing. a space. We in life is lease big of pause chunks when And the they are our also on couple years sector of they seeing grow, experience or the signs of tend

and Avenue are the Midtown side outperforming Sixth in only but new also The not strong, Madison activity on Midtown as Avenue, Avenue, in Fifth leasing West Park Avenue, Corridor. is on markets

demand On the at pace. continues side, West tenant

Hudson you the see from Avenue walk why. will you River, If Seventh to

last Turning more completed deals, we first given completing muted our deal a square transactions stood slew feet leases million leasing our XXXX of X.X December a now with of market-leading and where large that the process. in expect of pipeline year to activity. quarter finishing After in a negotiation

square was The project some at with Major a $XX we've shows In were the the mainly been looking at now the their we until healthy terrifically. locations XXX,XXX leased and premium wowed they square with PENN feet X. complete toured had headquarters core the of our square foot, time, the foot reflecting the the overall properties. what when in the late The Soccer market Midtown in building of district. MLS done first in lease our XXX,XXX League PENN quarter, X and for per quality and process new highlight by really is in quarter

Our hall ago we've space are park everything new first we spectacular. people. X are the by event open. responding is positively way, weeks pavilion to hosted attended and By just the event done to come. truly And our still rooftop, town XXX Tenants and that what's

tenants and across X proposals sectors. negotiating a of of with pipeline have significant a busy are variety We PENN industry

the million leases significant to another feet street different in leasing million but proposals this in strong forward-looking with stages. vacancy, lease also our of X just out almost renewal the pipeline is of In feet not and Bloomberg activity current on of addition addressing feet only we X.X completed, of square Much XXX,XXX expirations. is negotiation

such Avenue to and on we the when due occupancy discussed the decline XXX call, fourth foreshadowed XXXX properties move-outs As as Park. known QX quarter at an

[ XXXX expirations properties we to pleased reach on and care of XXXX horizon in of are half the We ]. activity more the already with these have report that taken and

The Turning to market continues to retail. recover. retail leasing

discussed on their there commitment that energized and rates pay are demonstrated locations. to blockbuster December further dollar other levels be best our Prada's the and call, submarkets Vacancy in willing and below in market to XXXX long-term are sales the works. retail in for we last occurred most Manhattan deals to and are rumored Fifth has the Caring's in potential now top retailers Manhattan As Avenue prepandemic

Our leasing almost has up couple meaningfully activity of picked quarters assets with last the retail our significant seeing in interest. all

Square renewal per dollar assets this Time in we our portfolio leases to year. PENN As quarter, over in completed one since evidence the million of achieved signing many highest in addition rebound pre-COVID, long-term rent the at of annual an the we've $XX our important at District,

Turning to markets now. capital the

are financing lease office still term. continue we weighted challenging, office, to Unsecured to assets quality The to for CMBS reopen long market average on with lending begun the selectively While tighten. for metrics for see markets at spreads some conservative stability remain starting products. bond has high-quality

the us. sidelines much mode, said, The generally coupons few office given more This market come still is all to in maturities Banks in retail. on workout and pain high-quality create being more the for opportunities That of open for remain there's will next are volume high. and lenders years. the for

We and to been on very have capital continue markets front. be the active

the extending our In also soon. extensions XXX recent Seventh, we other to to we XXXX XXX in of addition expect Park complete are process which on the and maturities,

as their the just Finally recast Steve to for liquidity challenges through revolver It of environment. days our XXXX this Completing support. our and million. We mature finalized of highlights mentioned, for and also we few our over ago, significant refinancing any thank them key scheduled support with runway deal portion in $XXX years. importantly, continued few challenging solidified a a of in was the this XXXX that gives banks next key the us to

in and $X.X good billion, $X.X cash strong credit the very restricted strong new shape current $X.XX size, forma Pro facilities. billion liquidity. is billion and for billion liquidity remains with sheet of including our undrawn our balance under $X.X cash a Our revolver revolving

I'll turn Q&A. it the With operator to that, for over

from first ISI. Sakwa [Operator Instructions] Evercore Today's Steve with question comes

a you to the geared vacancy how X how geared could much our And up And for, of little much in I made bit And on much rollovers? for Michael, PENN is I comments of guess, you help earmarked think X.X pipeline? maybe wondering if us million about the in development? was kind is follow the how future just square the through portfolio? maybe that current is just feet

Glen, you want the that? do to take on lead

Sure.

it's have a coming just to and space to a much today. in say available expirations -- off PENN coming we tenants on like coming it's portfolio, of we mix lease. say us X of just you PENN We're pipeline PENN expiration PENN at the Major healthy outbound I'd Bloomberg proposals did is and would balanced seeing of our with expirations a League heels week. in early I addition, what very where seeing described. surge the the Soccer We're both the this in So attacking X renew mix buildings And very, -- across otherwise.

of a guess you provided as this from earnings information Michael, the I occupancy of And Okay. back to lost drag I -- some follow-up, go kind the to guess, year. just -- on the

hit Just sort you're which to the took the be 'XX $X.XX hit and from $X.XX quantifying released know to some of clear, will in been the has this of interest beyond. $X.XX and and if now you vacate, expense rebound known maybe from I

kind You're there's 'XX level? bit number of say, $X.XX that of that might offsets up of and drag the we from, positive sort as about take year then sort suggesting other a this that think little $X

Yes.

detail there. So look, your in sort terms of of

and There's that that I $X.XX sort that XXXX trying quarter. version as the We that's more a on. accurate, are could we've mentioned, to interest lot about that you some But of working backfilled right? and a have vacates positive. to reaffirmed lot XXX. think the of already we've last I and of number today. we $X.XX the The certainly $X.XX quarter things downside Like known think give talked this we're at make sort we're

you And of $X.XX. you exactly [ going sort the down you so to can't where it's look, take to But XX if think the gets $X.XX let's case, out. plus $X.XX come to tell I ] XX worst I say,

around. baseline. I beat objective there's think to lot a still that, is that's but a good our And moving

on Steve, let a that me on, just for second. tack

and mentioned, accurate just they're that numbers the year. I Michael that mean, for this you mentioned that So

like build see looks there an what almost on certain and Let's company's future the basis. from

of normal occupancy, start that XX%, whatever the number we you improves if that earnings rates a give earnings into that's interest our back enormously. to XX%, take brand re-renting When comes new. we kind adds settle also earnings. number, with online is get So PENN comes another vacancies and X down of stabilized online, some or $XXX now from big XX% our are million to If that that

has spectacular. pretty the So what think, And we potential earnings the being, for. shooting that's company of we're

looking basis, a we X be power the earning And X So month we're that. we're out, at about X, it quarter not extremely would are what number company's on pick looking years at excited okay?

The next Capital is BMO John question with from Markets. Kim

stores coming Prada. more purchase to Manhattan about also to either Michael, in your one of a prepared sector commentary? potentially similar in remarks, of referenced you to the Is commentary Or back market talked retailers you tech and looking market those see your their in X? flagship do Vornado involved

I best John. both, we've got it's categories. of town think some I in mean product the both in

I leasing in than other any the landlord we've more done tech city. think

in the all portfolio. have big We X our

with So an maintain players. dialogue those active all we

than the So becomes to sector I would share. we're tech expect active more get if again, going our fair that

XX the seeing pause a the days, pipeline, requirements. seen the sector And or more on and XX tech of we're think dormant last pretty terms in some in there, started last we've now significant cases, months, in small either space. pickup downsizing And I the for was some XX, real

some and will So turning of activity, we're those optimistic about think on sector we again. that to convert quite do

anybody, think the On the better know the retail in retail we've I best had given the past. We in side, you own the discussions city. than

Square. So We availability, [indiscernible]. if the Times first, -- call the given sides be of be own Avenue, that's can on second, you third to shrinking Fifth particularly leased. both We're want amount

both And and obviously submarkets, numbers been last purchases. There's what both and the and activity standpoint think leasing make retailers. again, we So obviously, don't has and are garner their I picked thriving is in but spirits our reflected see every up a standpoint. are worldwide retail those from level ground. seen transactions Kering's I significantly amongst rumored They we're the well announcements alive Manhattan Prada obviously doing, attention. you've portfolio, animal fertile the buying think of other question, the other right, retailer given sales And

So we there. mix in expect to the be

Avenue. since either is that you changed likelihood outlook The follow-up is environment years the my at interest What deal. has or point? the environment XXX you in Citadel the struck Park past a this your lot options the the exercise and or on And Okay. rate leasing X.X

deal public through But building, There's space. drawings, process Citadel. on the will the They get complete committed process. for a steam couple world-class time. obviously, ahead reappraise that always likelihood. as now, a We've approval we. process And year at the right it's we're Citadel's headquarters full markets approval started the a build the the to and public growing. to to of the They're we financial are want design

reported the is And starting Citadel for confirm can $XX you million? at rent

the rent, market. at -- sir, is which what we the into formulaic go upon that of depends at No, can't. a time the It's financing we time cost the we financing

question Michael with next The Griffin from is Citi.

Michael, comments wanted imagine maybe being if Park PENN market have stubbornly submarkets I on around that's the seems environment Avenue some properties District, the I there better off high. the concessions case at even West the how that seeing But the of improved? your to go to your or for back given like you side, look to are overall. you concessions

Glen, do to you that? want hit

foot Yes. new Yes, no somewhere between sure. is TIs $XXX and submarket the rent a the $XXX, XX-month, range. there's in on would somewhere you XX-month it's tell Glen. free matter leases, I

specific, as the think submarket really rent. to it I it's about relates

seeing you would in So an tightening some expect. the are is of uptick where in supply submarkets, we rent as

Or those like is then rent of What's quarter, you there likelihood space move-outs color maybe renewing the big second that rent. Got this of of space? the you. some backfilling earlier? X% a The now looks on this the right And known high. lease in there's expirations That's just helpful. about or described pretty It one seems year. one overall the

spoke call. about comes Meta us pertaining last we It's in June to. the least That's our that on to earnings space you're that back the

terms or And of in space, the new it? demand potential like on what's of in backfilling looking

that this the on very feel backfilling asset that good good That's asset about we it. action feel South, Midtown have space. and described. We of space. our pipeline unique about the We good most in about It's part we've very

Van from Dijkum Floris is question with next The Point. Compass

actually, Rather than that's well. sort a Steve get opportunity the as and and ask details question get market Michael's on But the which into I the very is to presenting leasing, next be mature obviously -- on those wanted see over of $XXX to when on think, of view some be going the important are loans you the What do year. in the billion happening office I with itself, other next as well $XXX 'XX to the as unlikely obviously billion of refinanced.

so role And of a outlook see you some maybe where does assets? can Steve's in do tone -- in X the you in that some the on next the for have hope Vornado Do maybe -- buying bullishness play you cause situation? And that years?

the I the think there not are which all as markets rolling debt X like, next capital of So over support is to vast the that. years, of terms in majority significant we know, over, the refinancing

think one sponsor asset the the where what building Broadway quality recent depends a we've taken take and is sponsor to is debt example. back or would of be a like there's rolls XXXX buildings, there those assets, an with sale what something doesn't lenders of some forms. have happens asset, the of And future and or obsolete consensual of the it going like. a examples seen And few a have where a office so been some It the on that future older I looks its certainly

asset. where older a And is of think leverage just I a the Then there will sponsor whether won't. there's some those they they over a category where we'll fair buildings. or and re-tenant to cases, support lender some they see will, of cases, in think amount has the I again, on And that the future. the So either many capability in the assess wherewithal

back those talking strategy. winning and want for that in to quickly. they'll in about think Tenants go certainly into is assets that. the lenders them the know buildings. look to We're I a I operating fairly lenders general not And office Value space right? taking think deteriorates solutions, don't

work we provider. solutions with existing think lenders, do a going opportunity there's to be So to be

a operating have leading We platform.

I that value either We our residential could can one are And deploy from expect capabilities -- it the office or back be capital repurposed to that assets be to it be there. could be think in with up, buildings stabilize, leased potentially. that buckets. can of created It can could be be those

answer we the actively is are looking. So

play in that. We still at beginning stages. the think And expect to I we're

the transactions would presumably, it's utilize have your that I sets know in from some again it? way early But would get of of significant you which are have, if you plus right imagine, Your cash the X% for that assets. look financing were you you I have what to pay to to peers, apart would And returns... today part of in Is to returns your rates excess terms you to think like. theoretically about that awards, would of

that mean, going I in an Yes. the core is objective look, And right? is way, estate taking of to deploying and you're cash you I real the get that. right? risk of opportunity think for invest want to for by not returns, to not mean, heart, I faint is rewarded this is our generate

the need So attractive. to returns be

asset ultimate I yield But mentioned. on cap that and rates So a assets. yields, settle depends are stabilized where neighborhood the think the the I for nature particular little that think in of the no you yes, bit you question it think the required out

is, in -- particularly are know Maybe again, one your your were think, say are in rents is JV, sign would market you unique. that for if rent where Fifth as Square terms Time JV, rate have on in segment, -- space? do Avenue, rents market Square occupancy Avenue I sorry follow-up Fifth today? Great. you I you but you in to today Times retail which Fifth you your again, Where your of XX%, Avenue, highlight, your think And

year. think couple there to foot, Now And it's think square Xs, time tick situation. such was the $X,XXX, the a it's I neighborhood, of been $X,XXX a maybe now high there's higher. it that low I rents mid-Xs, that $X,XXX in were maybe given think guess, mid- on bottom the per it or that there's right? could we I a luxury, be into -- but scarcity in back transactions last depending at for signed indicates even the a realistically, And probably, I

a a So the paint asset command class. brush. right you too And scarce It's for broad Fifth far Avenue, rents the it's peak. very hard to not situation, can off that

the wrong retailers with For can configures asset it you that. think don't well, achieve

look, a rents So bit. continuing They're to that. recently, think have signed recovered we Obviously, recover. quite I I the evidence Times lease of Square is think,

And that expect continue. we so to

next Street. with The Dylan question Burzinski from comes Green

I back guess just any there, going available Is lack into a the purely Or debt -- own? are to as things the to perspective just on of possibly point. this at a things sort go the out to is sort more guys so financing debt and of from looking side loan at today? you looking acquisition it from there equity given of desire

is a way the The debt. to building easiest buy through

obviously that's So target #X.

opportunities opportunities, think would this purely guys it. purely -- are other office? you focused Or sense? And you guys Got retail as then there guys about make you think also on that is are

buy and obviously. We're open to retail, obviously, office,

that So the those we specialize in. X are areas

and acquiring assets on broader is external growth the I past, just are opportunistically know a guys on then and guess, basis? assets. going growing out an you table? focused capital sort of And still that you more now allocation in company I Or have guys I question. guess floated the the on selling

right sale basically transactions that are significant in We X speak. of think, as fairly we various now I have, conversation stages

from question next Goldfarb Alexander with The Piper Sandler. comes

first, been. rents. it's what So amazing journey Michael, X hear questions And good the That's rebound really to street about retail a here. in

when the rents sliding that basically is the Q, on a cited question future the address. so the lease, So in the first that are will read Bloomberg are a Steve, there in we scale negotiation

It's take not the then will up the next. to and that's the be range that we that one as it's -- negotiation So slides though it in? the rent

I in said don't that's discount the you was how got you something know published a Alex, and still that rent. XX% there incorrect. that math

basically So that But of the is is, growth. maybe structured of way out very basic feet that's the XXX,XXX XXX,XXX the net. the is a on rent deal feet portion, small net. There's XX,XXX is it feet building

So net lease call bump and The has now a let's it a between XXXX. lease.

to the foot, when to $XXX so we get net rent a foot. the which into the up of basically end start, where is And a XXXX, grosses well we $XX

So that's starting point. the

-- extending first of a we lease X that expires. and years recognize we all, before before -- renewing you Now established are lease mature the the

And take -- and affect have contingency. so you -- unknown future the future to the

So be more was starting XX% the did frozen. commissions the expiry a for, that, tenant the we [indiscernible] market-based leasing that we can't market if what less. as be TIs what than But in concessions, rate concession. the and what tenant is there appraisal we color are is more there foot or did than the established is though The account of then lease it proper net would $XX XXXX, XX% taking those into And rent frozen. then from a the already established to

fair the be market, landlord established rent tenant way, fair rent was contemplates of was arbitration on that both a ] will way in zen think would a By nothing which [ very will There's clever the bottom and So market. we have a deal what certainty the It be rent. in handling as be on think this any and in clever. the reduction it the future. whatsoever we the deal a the is the

was incorrect. for -- apologies. and I That my you, getting Steve, that thank apologize

rent is your that's So that cited clarification it... the

second, accept apology. Wait generous very That's a I your of you.

Well, [ I mean ]. it

for correct? are that now million a that had quarter my the is the And rents the the is that's in that is So now $XX rent net. like gross, basically, characterized whereas are sounds Is terms the the I it characterized confusion way the end. as on queue

happy get confused. into you why I that I'm won't you were confused. admit just you that were

next Okay, for down originally rents Great. to you question The is on was question, to it $X.XX Sakwa's mentioned the Steve Michael, this $X.XX. that year

there Was Or not correctly? year? to or based some impact bed drove lease just unexpected? this to seems want and $X.XX be like was did that that stuff earnings -- what it Now there up move-outs, I driving was stuff surprised? out additional on Or I the what's fell further you. hear have that came what of down what understand --

more a Maybe there, Alex. confusion bit yes. Yes, little

we On was lot right? from about are known the that to to clarity that move-outs, out. off. We a And And were those the early mentioned that where reduction baked off on there's the the talked year. gave obviously, going hedges call, to. roll interest we knew an roll moving there it was a impact lot in But last cited with I going were. because in be those those what that would of

-- We're it was were. that impact we of numbers So the for this call. everybody's those quantifying benefit what on didn't quantify

think to I now to less. opposed May trying no around don't where a more put were. to there's it be that we're little as be on surprises, right, we more precision just So -- moves could number going that And look, in and that

general and known in trying just talked those been sit get have the about that. deals have the a particularly we made set a bulk of more just XXXX, XXX, announced. we of re-leasing quarter. But terms today, to lot I of precision But XXX between where lot that drive a to think we that last we've of Obviously, statement

question next Securities. Michael Truist The is with Lewis from

on the to re-leasing going known the on some move-outs. activity up just that question I'm of follow about

And on known $X.XX an square could you've that much of much to related that move-outs share drag. addressed? how just year? probably But share already -- could how So rate footage is I square you occupancy footage maybe triangulate this

that or Do that? I anyone want take to take

XXX, XXXX And XXX,XXX of of and X XXX Meta said XXXX it care At XXX call said space. have that we've XX% at pipeline the is of as the vacancy, bulk taken Americas. we Broadway, the So in role, number of have Avenue activity so with at remarks, XXX million feet. on current his Along we we as June. Park, rolling Michael in and the Broadway

that in So we're that's how that ones approaching big number. the are occupancy

occupancy occupancy. see And X we've take into as a account of our back expirations account then we we get we as 'XX, as of the next as in X transactions going complete months, we taken So expect into during we into may deals, that through to climb dip to more pipeline our XXXX.

second about MART. is my then THE question And

in given maybe THE about what some a the of with you you think stabilized of XXX%. occupancy kind So volatility be like asset. for map little always a the What down to to that that or MART? recent road quarter, stabilized look might bit And prepandemic, revenue XX.X% most may occupancy there's there? figure like Could XX% talk dips obviously kind was that

is now, But right market you Like do I'll So ones challenging asset. of one distress questions, I to the a the there's challenging of to wherewithal do obviously decent the would landlords Chicago there. country. in assets probably say the quite Glen, debt the start, that activity we more jump in. the have have not prior of lease bit our Many Chicago the on alluding situation some in office. given

have We on an no debt that it. has asset

the by strength and sponsorship, the think is the brokers and I the so helping known that's I us. well And think tenants,

just business X.X, We is we cetera. positive. conferencing, stage call which we the been amenities And put have what in finished that the again, MART reaction et of has second

fair get back it's think basis. comes there. I probably get But into and realistically, is $XXX back the market million XXs than up in more to when tough, income it's seeing the NOI $XX X get percent that. the the X. the maybe stabilized it we're cash think But is to take a share I neighborhood. fully that's going think And to objective years percent back probably our occupied, to online, income to million So XX-plus And to our I cannot dismiss occupancy get that

the growth as is, fair But right challenging a there. come said, now. of amount market there's I to So

Burrows with The is Caitlin question next Sachs. Goldman from

This is quarter spread benefited Can Julien leasing? ex-PENN on one. might what And on for from whether Caitlin. PENN One the quick comment that District in the have leasing spreads leases? been leasing the you

Yes.

this a quarter. the the soccer generation. first That's new lease, with answer that I think is the lease is in majorly PENN spreads, big X

So didn't affect spread. the

like occupancy to us you expiration talked -- tightened fact charge sounds it give swap the is it term, second going the gain fixed the bit benefit about Okay. big interest quarters from then the coverage Cal? from And I also a that Good to quarter. coverage and know metric you've one And covenant, debt looked a have in know. on longer the underway. maybe XXX can some you NOI. But of District given the I a PENN know that the coming over sales like sort sense there's trajectory of at

you're No, accurate. Yes.

predominantly the up. PENN the item big this I impact think XX on coming year this was swap was -- quarter increase the

from think this go think though, a that couple go things as that I the that material well. of a couldn't recollection, was forever. big was basis if But XX it quarter, was too But I I other bad points, one. item

put second quarter, place swap in that quarter, would XXX. in will, We increase. another kick accurate if Next an you're you

we as we to vision in charge covenants, will buffer forward, still up look increase. have fixed next XXX have income our again. [ on leases cushion will tighten quarters, tighten from rate ] continue it the sufficient online but swap we grow couple these that as But some little of over So then bit the of there. And number the a based comes will up

The next with Scotiabank. Yulico Nick from question is

I just the wanted $X.XX, from vacancy. back to go this impact $X.XX year to

that to $X.XX year of So share up total NOI $XX of your last versus NOI about guess million adds billion. $XX million, I

somewhere So that's loss a it's X% math, like that correct. NOI on

look your parts So of about? that does X% I'm and not if had impact New all at quarter, talked in other Because vacancy you how obviously York, I expiring guess in the I expiring. wondering, -- fourth are just your there rent just the of besides moving some supplement, here you're you

what little were expirations a NOI X% loss year. number this to high bit the your relative So seems

in it's XXXX, and Park X little those of I positives, a to XXX are of There XXX and a think vast but may bit year. XX is drivers. December mean that like pure mean number. majority it. little be nutshell, bit the and simple. you tenant I sort it that's one last get of of negatives, But I The a expired main that there's

last move-outs, this a But -- we middle year. discussed. occurred is from which Meta, December we're through those just came we the that's So through in and it XX as period one where everywhere of it. various backfilling just known at the is stages probably there And we were some

a last I think to the Does of a then about And to occupancy year. of that to for a a way flattish of would this just the time sort this the be that. year, I'm year-over-year quarter Okay. that on when on quarter of based be get assuming year occupancy the flat wanted occupancy it's Michael, sort fourth it's and mean not occupancy? flat you're clear year-over-year talking average we about sort that by

And would happen up precision. Yes. of the think on will it timing pay end by you with that say year, can But [ know I again, the as not. of the certain Yes. opposed we fourth quarter I I to depends This end don't things. I numbers there. mean, by rough will January, ] what

that in but example, down So but -- that bit still going other how a more, still in first half we're think It's for have out. given, I plays it's the up. we'll works little have we pick like down to -- the and trend things But the can year, in the some just we see, to of occupancy, move-out there's now. see June, Meta it we

in we'll So total. out comes where see it

we as increased at time. meaningfully front look the it we think it think over I -- will line,

going to to event X down. a from could sort bring But where extraneous that's denominator. into there, being of are leasing an bring added we number standpoint next the the on We PENN numbers are the obviously, year. average that Depending

it So closer. we'll as get we evaluate

question next from with follow-up Lewis is a Michael The Truist.

have just more. I one

you Are units. left a You in X XXX was smaller value, units roughly if Central penthouse have wondering about million sold $XX at have have remaining just unit? you that. for you I or know don't South X condo similar Park about million. $XX the units a I maybe --

No. The less Basically, that view they're are much out. basically impaired, remaining job X sold lower is valuable. smaller, units so

is a Piper Goldfarb with Sandler. next The question follow-up Alexander from

with Steve, who would door the be this motivated you. great -- conversion always and Thank owner does new are existing maybe either willing. perhaps you contemplate assets would from incentives, for be eyed seem that that the open you've the a office to to portfolio for have is or assets to conversion

to the incentive package Just convert. passed seems they is pretty like for that office lucrative landlords

yes, the yes, answer is course. Alex, of

So a things. of couple there's

First of the all, or the that going price has a a neighborhood be building foot target somewhere the [ $XXX building to sub-$XXX converting, foot some the in of ]. you're

building. They're really -- building. distressed are office not distressed these they're So office

that. me Let leave at it

more, to you a So even the not. pricing more, pay pinch but and the maybe economics really don't allow probably

number step one. that's So

the if are is economics the C is, office these in obviously, X and target that those number B and are the Step those buildings building, the market. are

tell is So tenants out don't market A don't because are market, office look taken the deal are at that. they space conventional really really ever who A those the interested that buildings when of prime the in we

But dent the not A is conventional that So dent it residential the able an but to, residential industry, dent, make as buildings. convert the will big of It in on market for market. a effect demand the Class is, space. a number answer we and be a -- will will decent a a open marginal have

what It's be an that at to activity it looking we looking something they are. on that we're look the aggressively. and will anyway, capital are I'm we But returns people not at are some interesting think that. clearly, going at. it's pretty sure XXX% But

time. very you Thank no There much. further are this questions at

much. all We morning, to that. always you from Thank and Okay. this joining thank these and you appreciate we you anxious will so very calls, -- be learn us we for

excited see and Thank the next are We -- the quarter next you. the and we'll you about the in earnings call. future,

conference. for Ladies and today's you participation. your concludes this Thank gentlemen,

lines. now disconnect may your You