Brandywine Realty Trust (BDN) 21 Oct 222022 Q3 Earnings call transcript

Good day. And welcome to the Brandywine Realty Trust Third Quarter 2022 Earnings Call. [Operator Instructions] As a reminder, this call may be recorded. I will now like to turn the call over Jerry Sweeney, President and CEO.

You may begin.

you. thank Michelle, morning, our good thank for you Happy quarter everyone XXXX in third earnings participating Friday, and call. Chief our On today's Executive President Tom Operations; our Executive Financial Vice George are Dan President and Wirth, Vice and our call with Vice me President today Accounting Palazzo; Officer, Officer. Chief Johnstone, of certain during the our beginning, the federal of meaning securities may constitute to Prior call information discussed law. within forward-looking statements

assurance assumptions, that reflected estimates these are we in be cannot reasonable give anticipated Although, we believe achieved. the based statements will results on

further could SEC. For the release impact anticipated results, reports most information as recent quarterly with well file press our our that on factors we and annual that please as our reference

an Dan, update after our plan. today's And George additional for business Tom, on Tom So will during review provide call 'XX that I I questions. any and are and available third results, quarter

existing however, hold as select leasing macroenvironment, starts and unless development the to at 'XX on certainly of are low 'XX posts approval on continue impacted fears operating protection front. back our increases and on recessionary improvement interest the focus we capital we to inflation, uncertainty, operating forward on budget and financing fully Looking certainly will The market our will The the positioned on our well operating and leases, they margin And we changed of the pleased pre-leased, efforts, certainly and capital increases margin evidenced remain expense are by quarter operating from traction. operating that more continue portfolio, landscape. significantly rate, have enter cycle, and XX% until target. rollover, development while record us the we our stability planning plans are future pipeline program,

acquisitions, Thursday we're to higher XX% in our office in operating days, will attendance, see interest day to conversation. refinancing continues now of the and the physical XX% experiencing peak Pennsylvania might we During continue you days. XX% course overall, the Hybrid Tuesday and we work interest most from in of tour lease during management levels, closer and high programs those in potential Tom We with On of being most tenants. every high experience day. review environments to standpoint, suburbs. markets, our deal From XX% the common quality several the attendance and high expect, to an I remains executions. that in our that a rate accelerated the also terminated quarter, of as And order negotiations all occupancy through XX%

In our fact, XX% from deals of from XX% lower in tenants which to operating new portfolio amenitized from up the looking upgrade quarter last quality, less pipeline are buildings. is

XXX,XXX XXX,XXX third of square leases. including of quarter, new the we leases, feet During square exited feet

rate posted XX.X% also a of and rental a We GAAP basis. on basis, cash mark-to-market X.X% on

quarter XX% year remains And XX% XX% XX%. the University on NOI portfolio XX.X% full quarter square of the occupied a range Philadelphia it cash and on Pennsylvania our Absorption It's City, XX.X% where in that basis, further CBD combined XXX,XXX below its was for XX% mark-to-market our Austin and a we And X% Our XX% slightly and leased. leased noting covered which suburbs and markets, the worth occupied. GAAP feet. was to retention basis. to ended XX%

feet, estimate. X.X We of we revenue the and million range and XXX% spec which in our Market X.X% share, is or XX third exposure $XX primarily the REITs. portfolio US already to which per office million post million XXXX or also XX% revenue executed. is square approximately Further, the anticipated range above estimates, annual X.X% stable $X.XX million of higher are curve us million to of improved out Average The forward and $X.XX a gain REITs ranking midpoint achieved. is that $XX exposure XXXX. reach did basis. out $XX was through is maturity beat due The FFO daily out rollover through of into ranks represents a X.X which remains We with Our formation. range continue XX to those on efforts XXXX operating consensus than Street lower results, on to combination interest costs, of third speculative

XXX sales. EBITDA, for decreased share interest rate exceeding Based due per the to our primarily consensus higher the and range our at third activity are be range rate quarter, the current to leasing XXXX our combined to our at the estimates X.X of upper at based the development environment on X.X the of on And we're and any while net So keeping potential basis. to FFO unchanged unstable of debt we XXX of year. impact a to end end projected EBITDA quarter to on X.Xx activity,

X.X and projects. by on venture operating focuses joint metric portfolio development core range to X and active Our our eliminating of EBITDA redevelopment of

We are page activity, those how looking on continue portfolio. at velocity encouraging quarter. remained XX to during a more metrics noted our And this our accurate of believe of core leasing manage measure the is And third we SIP.

leasing feet XXXX. a pipeline X.X XX%, X.X total the levels and portfolio X.X mentioned that up square quarter, pipeline feet XX% foot feet development from Our conversion XX% during advanced second of the XXX,XXX rate and in are million on Also, from square of up the increased line stage square project last quarter in in pipeline with was as quarter, feet square broken is The on fourth up down looking square last XXX,XXX to on existing project. lease square over I between deal the deal leasing pre-pandemic the approximately quarter negotiations. operating XXX,XXX is of The the curve. prospects new X.X development quality foot million with feet, move X.X pipeline from quarter million square million million portfolio,

targeted improved four days equal accelerate continue and timeline. now the deal is to tenants line any is anticipate $XXX by other at line over credit. million side that Cycle development available XXXX. million $XXX the having we quarter our additional absent of their With past have to availability of of looking end pre-pandemic This good liquidity $XXX sources, financing at million an decision dividends. and and our levels. And Another under Time spend currently We median

per well payout covered with term Our dividend there $X.XX near know share We is a is focus maturity. ratio. on a XX%

will and during Tom I So our address comments. them

grade maturity refinance pursuing dated this confident investment maturity other bond actively explore We're several however, also have to shorter February a of and secured bond $XXX portfolio million flexible We in investment options property in options, and have wholly market more including bank million and two We we through -- this February sources. of balance continue non-recourse bond financing $XXX in in 'XX. do in joint We're could unsecured financing grade XXXX. financings and owned market. and loans October our sheet institutional only matures until ventures maturing that XXXX. traditional bond with the maturity our bond other is next This

underway are extension sources We and well. for with as already discussions those exploring financing loans other

place. where on leverage XX% The a yield first income an our million in with very financing joint commerce is venture debt a over is low on square $XXX loan

are exploring well sources. already financing an extension, in as the other lender as We existing discussions for with

and the a assess we as And capital well. efforts discussion The second to underway is in forward continue From in maturity spend. are framework August standpoint, allocation venture joint there of refinancing capital XXXX.

pipeline, suit to build rates. opportunities., the on other we as existing addition, of leased additional In for part fully than development I the opportunity of more at an earlier, process. all pending are ongoing are as our clarity starts on certainly looking million $XXX mentioned And debt cost and set, sale of and hold, properties more leasing capital on discovery marketing future development price cap our

and ESOP, on XXX requirements our Yards obligation XX% on We wholly remaining terminated the note since spend joint development funded. and on our $XX uptown total for you that underway are and Brandywine fully is Schuylkill equity pipeline, you'll are on includes remaining million, acquisitions improvements When net two as remaining potential on that Block also all development our $XX of $XXX tenant million venture which end. our XXXX-market defined quarter A owned look projects project and page ATX now million had at we leased Colorado, West, funding our

King to quarter the optima leased We also press the of XXX serve release our XXX% project. commencement will our project Road Prussia fourth This is their part of of We announced and in North as anticipate the 'XX. of project foot headquarters. as square XXX,XXX American stabilizing

spend forward finance to is construction we -- cost on are help that to on included project. $XX above loan million quarter fund $XXX already in which on our end as We this And the to this million project left of only based XX% total have a again in loan proceeding obligation.

noted the different well expressing having of King feet these feet. in XX Road is our of project leased $XX XX% companies. included already on doing our Radnor signed for this project And square $XXX million extremely is now needs that square remaining space. Labs In number B current additional XXX schedule. XXX,XXX spend City, at forward The million of looking this over is leases spent quarter. University a Our XX,XXX companies again, pipeline to is in on project Prussia and A totals are leased,

underway addition, floor on calls, floor was time demand. tenant plan progresses. currently XX,XXX So previous approximately up for totaling an through budget XXX,XXX space noted of square vacated expected active add another XXXX, continue nine, last on to as a to on being building On existing looking tower space pipeline, our and just incubator remain capable square feasibility science delivering. from existing we feet, do feet on The project including at this is feet to Schuylkill quarter. totaling of XX,XXX square life another which meet convert QX residential JFK have is feet in remains square an XXXX construction studies XX,XXX success, to Yards, And pipeline by life shy as We science

representatives. we now tours fact, their nearing In done for completion, tack the over XXX prospects and with have superstructure hard

$XX.X is million As equity fully funded. commitment I noted earlier, our

funded, the our equity has partners also investment is loan fully funding Our of and first commenced. construction

range package from supplemental in the of XXX,XXX we is X leasing the about life step a budget. building pipeline at Schuylkill about quarter plan additional of of on the feet our which dedicated will as life And square A, year. second next not our Block is on XXXX. cost project our development, and XXX,XXX it's we the on quarter be and announcement until obtaining another third by funding On required another in Construction loans plan, project our is a loan on And do loan addition of in completed quarter, 'XX project, to and execution construction early have foot of loan Yards, square we schedule that that close know XX% feet. Uptown we science $XXX of you on XXXX-market a develop construction is budget that That time science in the also noted ATX square is those totaling did million can during million. As space. construction on

feet. the is On component, which XXX,XXX office square

at that we flexibility land bases product do per life units demand. timing Our When X Yards feet. is particularly to with and pipeline, X.X feet give approvals, phrase science Uptown take can X,XXX million to ATX pipeline adjust we XX.X total is Of us key forward X overlay square about flexibility, can of a Schuylkill feet as know million FAR million leasing multifamily our over evidenced further and square build. is, pipeline We diversity. is the the to meet million of look at development low market a you square and that our mix by degree space,

as low the land base of evidence per FAR. As

did capital venture. an specify You volume will of did not note in gain toward property at on contribution components, joint does we while 'XX land dispositions. looking business not the million and that other record our $X.X land our statements plan $X And

have as on this active been We well. front

assets price expect parcels we As market close to we assets have do discovery. We of in as of have firm mentioned, 'XX. to land during did million sell do to approximately the non-core we that I $XXX $XXX million continuing sale agreements We in under of 'XX yearend. over select for do anticipate prior

of also next fund reduce We these for that development results. select Tom expect now our provide and property be generated further overview leverage, quarters look from existing higher used of the joint opportunities. will of dollars certainly that will occur financial activities over our pipeline growth ventures four to and yielding sales an will our

Jerry. you, Thank

Our million $X.XX and per third estimates. quarter diluted share million per share, or totaled $X.XX net or FFO income totaled $X.XX $XX.X above $XX.X consensus diluted cents

we our forecast and above timing slightly several second quarter, of the had consensus quarter regarding quarter numbers. third third being than Interest and was capital of So million the expense lower general forecasts. primarily below due results observation $X.X guidance were variances is interest rates to to our our those spend,

totaled forecasted venture. $X.X a not have and higher our quarter full changed million Portfolio guidance guidance. the Land gains year second our million. above Market above our $XX was approximately of of We million joint operating on formation income gain Street due to were XXXX $XX

debt were second respectively, and quarter which quarter and were to forecast. X.X X.X, third service Our line the coverage interest results similar in with ratios

third end guidance range. net of above EBITDA debt-to- slightly Our quarter X.X high and X.X X.X was to our

Jerry our XXXX guidance unchanged. remained As mentioned,

to sales While mitigate in and rate asset expense increased our exposure we expected the line credit rates, will sequential consensus, approximately will our quarter, about of hedging there were interest our interest of through results lower do that fourth believe of floating ahead rate some dollars cautious balance. $X.X and opportunities remain interest be totaling floating

fourth the absorption approximate to the be higher of have following Property quarter than as income general we incrementally and quarter XX.X operating Looking level will interest will $XX.X primarily XXXX, million, increase due fourth to we anticipate the assumptions. third will the $X million. rates net increase capitalized expense interest slight higher anticipated approximate will quarter. interest during and to Total the a

of unconsolidated FFO total G&A ventures $X fourth for contribution will our the million $X.X joint dollars Our will and quarter million. be from

increase refinance total and financing, in bonds, million current Our can for Refinancing 'XX. of the to the liquidity tax we Net forecast our we approximate our $X With in and regards a bond. maturing believe liquidity. term quarter. income fee $XXX the we activity, dated net and future to are we quarter to with market options provision assessing gain our and fees will expect $XXX,XXX. fourth them that will bonds million February We shorter be other on as $X.X million the management for

the mentioned, days both financing and that our XXXX bond quarter million on line outstanding the proceeds between our sales, credit. on the Those we loan against assessing line in raising be credit. bonds the the floating pay at to will of combination assets that We and $XXX of in financing, this and several outstanding are and as unsecured $XXX However, off million anticipate future. XX will potential rate a balance secured allow of options used lower Jerry repay and to and the within in us February looking include next in our term balance to reduce form

activity the CAD Our costs And end be and range XX%. very fourth run quarter higher remains CAD capital rate XXXX payout capital to plan associated higher is leasing at the due our our is on ratio straightforward The XX% will primarily historical higher likely totals $XXX range. portfolios. to with million, the JV that our the early at above of

net $XX development million expect capital from in contributions equity at end We million approxiate about dividends $XX revenue and million and our availability. leaving above, maintain in of to the $XXX our each $XX in in line will joint the spend line $XX million $XXX and redevelopment. creating outlined and ventures. revenue and million approximately plan year, Based credit balance of on of the million

decrease. we EBITDA We debt X.X. how spend. our of will our future that in will anticipate will in interest We to liquidity, grow ratio also leverage. ratio capacity be incremental ratios that of and EBITDA top the our X.X have expect development we $XXX debt-to- our balance our main To we credit. will sales our coverage service our development fund our of leverage From our is line today's forward invest net our lower development elevated is the believe With asset net to expected of as due lower to stabilized, debt-to-EBITDA those and is pipeline, targeted We pay range do that X.X scope And redevelopment developments line the with XX%. approximate on credit, invest as and at projects. for million guidance will once and development that will impacting an be active variable our highlight coverage to to net timing well ratio the at XX% And primarily those are regards our these to current transitory. be end further to believe are X.X debt-to- ample

an on investment incremental invested these decrease as the of we our active end, low we million of outlined will have As million X.Xx we forecasted $XXX range. in investment back NOI cash page, are currently stated leverage projects little our development earnings, anticipate projects that confident the generating over our those that Once leverage provide increase development Xx achieving projects $XXX no are in time, to yields. a XXXX million quarter $XX into to stabilized, we represents

some As mentioned assets an to stabilized, net joint Until over the of above, the offset sales in call the debt-to-EBITDA at of ventures quarter, range I additional metric we turn with 'XX, included X.X that our and now development development 'XX. the to partially current Jerry. development plan end at and target will core active excludes have back our this we projects.

Hey, Tom. that about shape. prepared that to Thank wrap future are our you. in portfolio Well, solid the demand know up remains concerns We drivers. comments, there of kind

their right pipeline I that prepared is leasing this cycle, in by to inventory. in now for tenants the At we're looking additions upgrade. think for new upgrade continued what our point pay seeing they're of an

us posting only move rollover in our into good very predictable and certainly, mark-to-markets 'XX strong as accelerating capital shape. the metrics. uncertain annual still think leasing average is X.X% operating with And velocity, and spend, mean, we we're I puts very manageable more So looking we times. forward good through exposure

and for one delighted the really open well. family where end in to up floor started, we'll ask interest And the time in and Michelle, follow we questions. as of that to usual, all question yourself a do your as you you do we we that wish So up. limit we're

first question Instructions] Spahn comes with Brian from Evercore. [Operator Our

thanks. Hi,

So development maybe a projects I guess, office, in of from particular and pipelines. color some you these seeing could on spec more seeing traditional both Schuylkill leasing talked the much large spaces? specifically demand you're Uptown and are and bit the how you demand But users about Yards for life science you potential just the provide and ATX for activity

Good morning, to Brian. I'll south move north.

certainly in. George, chime a pipeline. I take to free think look we And our at feel

We have still development early very, in cycle our very is pipeline the for good. Uptown, that's very

building discussions close have continue. the full them evaluating users who to We several are project, and with

Of their course, to they tend size, fairly given be complicated.

So we're with tenants active we their couple who users. have floors range them and dialogue then whole a representatives, honestly range of in floor from to single a additional

Given Brian, prospects building. But the right to smaller think availability the out shadow demand we're keeping started now, user in where larger the I of have we entertain yet on land, pipeline in some seeing floor. not a one tenants' what where to that. floors we figure We're we've see than want the

residential I activity superstructure daily leapfrogged November. the -- the six of seeing to I very up having system think mean, science The we're tours active then And the brokers. Yards. We tower. we of So thing levels life will eight have on the their wall up the side. And prospects, level daily is with to window for the out there. XXXX happy we at Schuylkill north end at the the same we're of with top

very the So there good. is pipeline

of feet. we're academic to that there on a little up as into coming growing XXX,XXX well. be and foot of range square demand from users on the XXXX early, graduate institutional of floor really XX,XXX floor, region then that. level from also single than XX,XXX thing science groundbreaking users couple of the square again, out the healthcare looking ranging But systems. there a Same companies less coming have the of to feet, a i.e. good just incubators And smaller we're in square number the multiple they pipeline to users the from as ranges XX,XXX space, established queue a life are the We bit a up is well at out a users companies, as number in more floor

And you guess well. you of in what you for assets transaction in say about terms the bid market talk can't spreads? impacts would Thanks. the on ask you funding just And around that development? touched it? as to sales I you're dispositions, Got today plans complete the additional And Could your maybe extent dividends? are additional thinking how what the seeing

think out we Yes, well, think have is spend frame the tried what funding $XXX we plan the we developments forward have underway framed of in around out or million. clearly I I terms that fairly future to committed development,

out. have that of to place So plenty capacity, with plans we fund our in fully

rate until the of and now, more where uncertainty use on we As But markets levels I rate and pricing climate be. get cap this the in than we're number putting those mentioned, more interest those given also right worse will out. importantly clarity hold on a where projects play is

that hopefully the part of answers your So question. second

of a of lot tending In where debt that are know. bit buy little to to seller and aspiration, between disconnect buyer a their return volatile expectations, so still and -- they the it's, buyers sales, not really speak, pricing models, frankly, upon the a late, all between is, asset a you're their and because equity of of that and terms debt as there's trades models been do had we more see saying occur, markets, based the

So the levels terms what that confusion price some, creating appropriate in of some are.

we're very tours. the to pleased with that number of have the I do as think, we well confidentiality signed a of get in to in general, have information, market, the number the as agreements for assets folks access

interest there's level high of of a there out in potential So terms buyers.

a good. the levels that quality the think on pool are. the of the a bit of pricing reasons based things levels unclear buying the I right one And quarters seeing seeing think I just But and metrics target originally XX% levels, seeing, now XX% are trade. debt couple We lot is where of why we're somewhere of that's to activity below, we're level pricing not are of think I pricing ago. the targeted a

Our Griffin Citi. next with Michael from question comes

disposition the there pools disposes? might these that proposed Do on up following relative in terms attractive that buyer Maybe question. of partner these transactions? you have kind a sense to of capital more targeted for one Thanks. of be And others is

two depends I money. foreign looking. range syndicators a the number in it It have from are -- are the they of right that gamut Yes, look, who in that investors down up there's institutional our in $XX to Michael, really investors, And and bidding have are there mean, runs million from pool value full now, to basically about marketplace $XX assets we range value. million in tier

So sizes the of of number out they're Certainly the it's mentioned, surprised lobby great walking are wide level investment think that we're pricing to equity the brokers us through because debt I are wide like of range we to make that comes time through kind be been after range earlier lot the on going And, there. So debt what's my these looks debt a tours. they fairly hired asset costs be. spending represent a think who I much where to as of on with of lending number in properties of pleasantly a sources, we've are the the should a we've as coming project? I the to question as for down people question, is investors up commitments, locking understand time sure outreaching the answer trade, spending

from X% getting I the under have exiting pretty rollover the to we be the we a be end properties I have that then project come And that And what testing cap a offers of mentioned in that across about pricing we're agreement, deemed lifecycle. mean, when rate. the to we the of to the by of we're those at year. good non-core were at range quite them market line, good stages they feel kind candidly remaining we finish position in of as respond assets market a So in. sub higher

ones are So stable. that more

have prospects, being the a for Jerry, refinancing debt, more do about And debt maybe of potential the maybe you've sense just it maturities Thanks. of longer? any there rate then term for shorter-term I you talked terming and upcoming it think out possibility is these? on and And

want you that? Tom, to Hey, take

Michael. Hi, Yes.

I in a for think some refinancings of are but that the term at range five most it this deal a a potential, Again, get outstanding years. looking being or five-year of that out with them if that keeping the kind years, little for we're things than they we looking debt of than even five of are it, the shorter I years bond also at them five could we're them we're kind of earlier may think and targeting they we're at targeting that, point. instruments be refinance

to to but if trying us them out improve, can look things will, repay at some go options that earlier. window, allow that So that five-year potentially,

Our William next question comes James. from Crowe with Raymond

Great. Good morning. A couple of bigger picture questions here, Jerry.

of of if years the mid-Atlantic asking kind had of and what lot is perception and Philly, And future move the in being a of accept they was there's I'm ago, a challenged. of out today, been might that's downtown Philly Yorkers about New that it maybe change you to just the crown have drag jewel I think that ready you willing was the kind think was demand. tenants might perception five CBD to you went area, anything back and narrative the be on a safety like if the market that I a for change look of that, maybe market that

trajectory. a suburbs, years bringing to in move I a region portfolio actually city, Philadelphia making Hey, see lot migration to into of benefited a has certainly Philadelphia number Where progress pandemic, the major half during as And I the tone think were couple that has morning. plus city but lot into Yes. were growth of center course, well. to is of market. question. new look, of cities that on That a during dozen tenants the pandemic, really new the the last the Philadelphia mean, of in continued the think these we an Good also in Excellent our I slowed, changed. close we've to new amazing The pick of the economic in able Bill. up the companies Philadelphia. and of into

I you're lot other seeing think some concern and in of the safe clean repeated a cities. components is there about that

I think of there's a builds general as viewed is I by transitory. certainly the lot perception that. a focused tenants. concern of bit attention think being It's a But some on

the the the vitality range of IRS we the lab there great building, Regional million of you Pharmaceuticals get of And But and working city to the house of where directly shoots, program. here potential they're they're cell doing in communication as the that gene and a Philadelphia, I Philadelphia. when employees with be And that'll office both will across underway be of Roche growth doing, in they door, our close provide an a post whole as sector those Philadelphia, certainly Rail business manufacturing green the there's building, business certainly academically from the all from public through certainly discussions it's ensure over may the concerns. announced continued think up that transitory private anchored and provide We're methods from and for, with business, efforts the is lot them to what a to to recall, looking comes with fact, a research addressed. $XXX allay in in through Bill, readily I in all world. issues think like candor, Authority we we're them and the at the walk that the the therapy in parts improvement are people city outside. topic districts will are, some and that's of

acknowledge we transition investment university these discussions city. of not think including particularly in question that major think tenant of they your activity all I if So or Philadelphia know that their cities need to through. But our we of -- portends they're work well, don't answered business I that that readily type for issues but. of way

mean, your live it's helpful. it's we don't there, Yes, gee, beneficial I thoughts. to hear if

time next here, your days. that's attribute is, been you Recession. but a is very question couple my we've lease having lease agree of with absolutely been I expirations and question, a of second during like trapped over a opposite maturities? since smartass unfair? feels in of lease last Has the mark-to-market But I duration lot where So just of the crisis period and lot shorter we the like a kind a The you the with have feels term sweat? healthy there course, few short-term about no mean, And in twice be positive these lease environment premium just for it growth few Is years. would talked of Great exact that from of that's a of it you. financial years that remarks, prepared rents. the the XX ever It for enjoyed rollovers a industrial time where not

Yes, apologize. I Bill,

cutting in You keep and out.

which be So a asking there provide it's in is time NOI? rental lease looking direct, the just point at shorter we term you upside think of to we'll maturities more at intermediate

it's the enough actually hit XX last Yes, the The have about the near-term years attractive sorry mark-to-market just, time good It when was to want there thing it where that over term a we've lot been a near a you'd maturities? been of feels time that reception maturities? like never here. has is, question

But seen there it's It's do been sunshine. Well, think from sub market have moments that. of I rule. we been, a a think really haven't I pure standpoint, general

look example, term certainly here, us. portfolio to be portfolio, for our City has or leases able at our when significantly. move up to Radnor So doing very successful out for rates We're I University turned take bridge rental a

Northern our Texas. seen that them. that three-year of DC, number of doing into years had escalation were that A Maryland in leases We we Washington not have Austin, Virginia had good some ago, We moments build in market.

really we market sub for it's through. really we really, it, think at that try and it's us a as dynamic look So

take we'll levels, and is at plan look rollover based on take So a then a what our modulate forward our look that. marketing occupancy existing at the submarket by

tends challenges in get construction leases to escalation and dozen mechanism that tends really the capital the we've overwhelm One in of to bump. governors has quite recovery next had, years last candidly sometimes half be to shorter-term that the to desire pricing. the been the Because the

or there and lot suites, tenancies we have And we and tenants leasing, move that flexibility. track tenant has another renew, get our get that smaller we again, higher on, that we either do where that the but than tenant do as build do, actually moments provide of range, get normal we been to this rents in to a So out been record that of those three-to-five-year spec condition. talked we

hedge So of a us. for provide pure the I do structures, it's been inflation strategic us, I think lease our migrated we've leases very XX% objective. that a much for like tactical to, versus

escalations average to in high are the low twos threes. Our annual

part provides lease our look and rental plan. as So focus increases, do every at kind on annual take our average we of then year it which we terms, rate a business of

Our Advisors. Ismail Green next comes Street question with from Danny

mentioned is I to those Great, leasing those are going on do back there? earlier sub cap, or a dispositions, you. there an the you thank Jerry, to being response. believe six stabilized Maybe some

stabilized. the is One is residential And fairly other project.

for $XXX included I on is had is it this that block, earlier in market guys placed disposition year, assume you And that clarity, Got million? it. that not to that believe X,XXX safe

not is -- It that -- have the is in Danny, We that market. would still we that correct.

I talking to about earlier that high of why quality there. lock we we terms need a You volatility point financing. again, are amplifies couple talking away bid before more the the debt Day. in day recall, importantly, And back, summer the the Memorial launched buyers we in, coming of may of kind still But moved was to that that and with at right think

products a the comparing in. of the really So pricing I that kind then And to we're putting think marketplace, where will different back data types of from we sense in number the of kind following settle get that. to think we using we're approach then And of of what think a getting of is trading kind occurs asset's net it be of over discipline prices market sales. value as see versus these on some quarters a that several internal value asset of the present clearing the look that's next the as we from the holding standpoint think will I we where out will maintain And out.

last Got those mentioned potential developments. acquisitions on opportunities viewing just as for one to flat me is are of light quarter, as it. well terminating over announcing And our which numbers price, in a suite curious the XX% the now you guys repurchases. and the, I'm How few share then bill you cap share just rates this

on share table Yes, repurchases are the for certainly look, us.

think to near-term we of that want our toolkit fully make trying on liquidity focus the as we the refinancing near-term some say, we sure objectives table. addressing the I that's get And some fully to the additional across maturity. assets walking the away sales recognize and all part about that. And maturity deployment once they of of spoke certainly We achieved earlier. value I certainly

Jerry. thanks, Great,

make you. answered Okay, Thank thanks, I question. that sure your want to

next Our with Steve from question Evercore Sakwa ISI. comes

the back I Yes, a to whether of little obviously thanks. going Tom, it's And circle go I terms on fluid years. wanted and you're XX some morning, stuff. curves understand just the Good Jerry now to of X debt Right inverted. or in

expired you anything thinking treasuries, costs fixed So are a your tell but million debt obviously to term can guess then below think October? five is on you years, all the $XXX secondly, how And XX-year about loan where in just get trying would today. better the I about you be that in us there guys rate I'm spreads? handle

a Hi, couple those. of Steve. I'll answer

grade And a grade of credit little all flat pricing curve bonds, for take a if are investment rates us, And high not yield as high, And in you where number much I or an is, our not I right look But X% offset bit we look spread to at maybe at the the that's it market seven And we're difference there say when XX-year would where in of seven- getting and considering bonds, that's the in curve. say range of is terms pricing different. So of for inverted flat between think the think five-, for is change rates. on a a we either bonds take yield. a as look the, there's the be today. kind is, five example, open. you're a now. talking and I'd investment it quote bonds, and are bonds, at but a I that It's XX, comes bonds, net down would very

your I second think first of that's your question. part or

that at if The the a that second the one, you swap, swap a through of term now point you you're asking if loan, line of on I about that extended going to term float. this credit. million term term talking you're was we as did The about And part the think was loan -- loan swap, $XXX loan are October. have is

put not this a have it on We point. swap at

curve that, we a at We yield long-term we fixed that especially have with the are do looking done but at point. end, whether on want not we where a to at back swap put this the rate see to

back There no over the further Sweeney like closing are questions turn for Jerry remarks. I'd to to call

-- and look much Great. for our of the Well, in wish you for today. results updating holiday We Michelle, very business thank to you Thank all day. in fourth after quarter great plan forward first you season participating help a 'XX you on we great the our Have call. a year.

program. the concludes This

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