National Health Investors (NHI) 7 Aug 242024 Q2 Earnings call transcript

Good morning, everyone, and welcome to the National Health Investors Second Quarter 2024 Earnings Webcast and Conference Call. [Operator Instructions] It is now my pleasure to turn the floor over to your host, Dana Hambly. Sir, the floor is yours.

Thank you, and welcome to the National Health Investors conference call to review the results for the second quarter of 2024.

On the call today are Eric Mendelsohn, President and CEO; Kevin Pascoe, Chief Investment Officer; John Spaid, Chief Financial Officer; and David Travis, Chief Accounting Officer. covered as released the yesterday after press has well conference of and as media. release were financial call the been results notice accessibility of this a The the by market closed

date December its the Any as XXXX, statements are facts involve this for XX-Q quarter any with to forward-looking All risk of are website of and risks that in statements call, available of and the or ended NHI including other NHI's investors the XXXX. or are Copies SEC's statements nhireit.com. forward-looking the not future June disclosures Investors and are not Exchange at cautions ended guarantees information historical NHI's call. filings disclosed statements. forward-looking Commission, sec.gov are for this filed of on review XX, reports factors at in carefully conference on the made XX-K which may judgment uncertainties these NHI's NHI Form represent Securities by conference and periodic Form performance. urged XX, and year website the various

all and are addition, non-GAAP financial which provided the SEC. the call to certain information those this NHI's encouraged which in review other provided with been and provided tables earnings are reconciliations in in Form terms earnings of reconciliations In X-K to schedules, measures, used that release, release release. have related on in furnished Listeners together are

our over I'll now turn the CEO, Eric to Mendelsohn. call

for us and everyone, thanks, Thank Hello, joining you, Dana. today.

and strong deferral operator expectations. stable unexpected once of rent our The represents cash consistent as had growth outperformance our we no concessions. to and fundamentals, straight performance collections, exceeded fourth been and quarter quarter second steady revenue occupancy improving forecast have The drivers SHOP payments, of the again relative the

million of recent we've we're an and investments activity excited $XX.X the pipeline. closed approximately yield the our of Year-to-date, growing driven primarily organic X.X%. average very initial has by recent on outperformance been While about investment at

billion. million. In addition, estate investment and loans amount, target housing we with we have we have assets of sourced a investment opportunities pipeline. purchase $X.X and also approved, expect are million senior to LOI year. We're opportunities approximately Board of $XXX.X in pipeline that more Of this including also than which real our large pursuing this portfolio close evaluating totaling simple options. fee investments These We're not $XXX RIDEA deals, included deals, several signed

ample to company will to positioning activity level We've prior patiently return more of and that future. expect improved realistic growth to cost capital of the multiple in the pandemic. flow spent dry years With the significant driver investment experienced of foreseeable expectations, cash our external powder growth we acquisition a we seller be and

of normalized would total second $X.X deferral compared Regarding to the our XXXX, have dollar per respectively. our quarterly repayment and increased results, quarter, lost. share recapture the quarter XX.X% is allowing us to otherwise FAD strategy, a received and million which in testament a XX.X%, NOI been to that FFO We

to nicely SHOP to $X housing our as approximately goals. revenue operating Bickford, $X.X $XX.X XX.X% housing deferral net million. Including X million growth senior repayment. in rent portfolio did tied have to increased balances Bickford their April million also operating deferral The did year-over-year or by The step-up revenue-based we NOI

portfolio. of move rate internal longer-term result growth guidance we we're expectation, confident upside continues in While that and the the year NOI our this higher to encouraged remain was potential occupancy and slightly below for the our

Given and our the the good into visibility raising strong results guidance. once of second half the we're again quarterly year, XXXX

outlook several midpoint growth The of with be our the increased factors to FAD FFO original to guidance X.X% and guidance. X% normalized improved midpoint of represents XXXX. when continues guidance to February updated growth share a compared contributing broad-based Our to per compared

Our favorable stages the the by supported through believe characterized therefore, generally dynamic. an profile short-term agnostic bullish increasingly cycle business that both economy. ripples We internally to demographic of by is the are environment, succeed is company growth supply-demand all to and and externally we and multifaceted, position the in

While as public days the for the we we that company, about we ever future we're several have exceptional excited a as come. we're history long growth to in have convinced and years been, early a are of

call now details to Kevin our operations. to the turn more I'll on provide Kevin?

solutions. see several we inquiries that months said new actionable volume we're we quarter, now have of in That million and refine the Last that significantly yield asset at financing average in Eric. X.XX%. an to across $XX.X and last communication activity deal and still is more were you, investments of happy Thank starting closed had on the increased we to true, all classes as year-to-date

that opportunities housing in size on signed primarily Eric skewed described As Further, our fee quarter opportunities simple the looking investment opposed first the estate are fee of increased at we senior and noted, and has focused our the what simple the as other assets we well as of add are actionable loan of we described real mix LOIs last deals more quarter. from to deals to pipeline I'll XX-XX call. significantly

path to As ownership. estate are with loan for the opportunities, real always, looking we a

Senior Encore. operated a Sussex, which previously partner is the had constructed For of Wisconsin, acquisition housing loan funded existing to a partially The example, price newly in senior an on for with by we Encore provided was Living. $XX.X satisfaction construction the purchase we closed million, community of

We are with mortgage have originated about and partners loans far this so opportunities. potential with have speaking operators. both other year these we These options, X already purchase

at across Bickford by X.XXx. had X.XXx, operators period not classes. The continued improve, and growth with asset positive the to driven NOI The quarter another We with provide we coverage to movement ninth EBITDA strong trends asset EBITDARM of rent adjusted sequential unexpected positive was did coverage again at concessions. and representing year-over-year had straight management. any growth. Turning need-driven primarily

positive Bickford healthy the from Adjusting to XXXX would experienced They by of XX.X% Bickford to first April occupancy the which off quarter and out points coverage XX occupancy from near basis end a increase, quarter, Their turning XX.X%. basis the rent started for quarter. flattened quarter second June increased of July the to a average to been XX early the second. in as good X points decline declined have the is start third X.XXx. the a

was we $X.X quarter, a during The which and recently repayment million much added Bickford Deferral X.XXx properties in as more and dipped included excluding X coverage constructed need-driven change buildings from potential. $X.X tenant. million sequentially cash This from basis X.XXx. X to with the $X.X of assets the mature a a million upside function Bickford sold totaled repayments from entirely

approximately we Bickford's from the $XX.X the the junction which $X million for first million still deferrals, adjusted half Bickford transactions. repayments repayment and reset. XXXX. $X.X quarterly other million repayment formula have rent net in declined in realize Including of in repayments we in we quarter expect the second We with Bickford, to estimate as value-creating

primarily Our fee at X.Xx improved discretionary X.XXx, specialty our and senior entrance above X.XXx pandemic includes portfolio performed which SLC which both expectations driven we to fee coverage coverage NHC X.XXx The be portfolio at improvements Coverage to began, X.Xx. X.XXx. other from The the our our has entrance hospital from improved by improved and that SNF at since sequentially portfolio, the from solid and to sequentially housing case. continues operators.

quarter, fixed last coverage EBITDARM reported a listeners and reminded we comparable to is and operators. charge for other reported not coverage NHC's coverage asset corporate represents all the classes As

much new presence IRR During Champion and Wisconsin the revenue NHI a which to the the purchase greater Care, which property has completed the in to has in XX% transitioning if of operator will process exercise. operator a quarter, The option state. lease unchanged, of the beginning a second in we on cash one SNF that XXXX, result is

build in portfolio. Lastly, to throughout SHOP, continues momentum the

quarter XX% occupancy margin driven to Resident margin to increased XXXX, Compared of year-over-year Second basis first year-over-year, improved basis to points to from contributed the of and by XX.X% by basis improvement by points. XXX $X points, slightly by XXX XX the increased NOI XX.X% declined while to expansion XX.X%. quarter occupancy XX.X% fees million.

XX.X% expectation occupancy the below quarter, occupancy margin showed continued was improve decline at July another sequential to on to June. preliminary The ending our note in uptick slight second a XX.X%. high that throughout The

we occupancy reducing to expect should margin significant to the model. an given operating to XX%, start lead move-in improvement leverage gets living independent incentives, which in closer As the in

NOI range. high year-over-year guidance SHOP as XX% for that to is margins view the dollars portfolio growth unchanged XX% in in is Our generate can this current mid-XX% teens on at our long-term NOI the

to the turn to John? call results guidance. and now John discuss our over I'll financial

program on income, rents. our our which Communities from But Thank quarter FFO to Eric today as around also recent metrics. at we exceeded my which positively maturity of impacted and touched those Kevin this focus and and and additional improving our quarter, Living funded. expectations and our lead activity expenditure you, Senior increased are FAD hello, lease The benefited the existing rent will for under net deferred will this dollars also revenues, be Kevin, CapEx our everyone. leases with collection capital remarks

new Living. updated improving property the recent investment with additional second Comfort year conversion Living recent operator, including quarter Senior the the expect loan million reflects our with transition activities, Finally, lease a our outlook to mortgage new with guidance we this Encore lease from investment Senior and other contributions the $X.X and our

our and discussed, While result will pipeline we in investment activity our Kevin confident Eric guidance activity. doesn't pipeline reflect feel the that future that just future

talk So for XXXX. about I'll our all to more our meet needs XXXX we plans and as look capital

the guidance, second year. I'll we're to Finally, for raise for which results this time quarter. talk about very second pleased the But our first, our

quarter. from diluted for up $X.XX quarter period per the income $X.XX compared share June first net XX.X% XXXX, year Our same sequentially last the and to XX, common for was the ended

prior diluted Our quarter for NAREIT XX.X% X.X% first to quarter's to quarter and XX.X% up and respectively, June and results. were the results X.X% XX normalized compared second FFO to share our year and $X.XX, the sequentially compared per $X.XX and increased ended common

was quarter increased results. the X.X% in quarter XX.X% our to the for up quarter's $XX.X $XX.X second year million first million sequentially compared and FAD to prior from

XX, Our year. up period very We're period pleased XX.X% FAD same last to ended results results. compared X-month for June with are the the these XXXX,

So into little detail. a more let go me

rents tenants of approximately Compared The was quarter was quarter. recognized primarily to basis to the higher percentage other during in revenue from Net the rent the NHC deferred and our first quarter in improvement cash cash the true-up $X the recognized XXXX, rent quarter. up million. annual for the received first due second

the on the the new to quarter-over-quarter during capital revenue to the in as lease, full lease $XXX,XXX expenditure first touched Living $X.X commenced straight-line the the property I in quarter. was Senior activities guidance. receivable a from straight write-off primary straight-line improved a second million earlier, improved quarter. second line the recognized first which that's As lease Recall increase that our But compared for impact transition first our quarter quarter write-off The updated and leasing included under was revenue under straight-line excluding now modification the program are contributor revenue. other lease quarter a in Communities after

quarter, flat expense, first during compared from in XX.X% business quarter. NOI year SHOP compared quarter proxy-related the our to but incurred G&A in Cash quarter, second the compared excluding the was which represents compensation in expenses to our primarily prior a and portfolio due is stock the development increases to quarter. G&A first increased to $XXX,XXX the expense, expense, NOI noncash improvement

loan property in in we and loss for approximately impairment loan, $X.X the resulting losses During on sale, of properties another held one loan in placed realty quarter, reserve increase resulting and the million. assets

we As XXXX. record and last September Board for our XX, per on Directors of share payable shareholders declared XXXX, X, $X.XX of November a night, announced

signed an today, May If the our that pipeline us, we and quarter, noticed you've fund. over closely even pipeline disclosed closed larger you've our million activity earnings we following significant plus now on million transactions been in $XXX during in $XX.X have since increase call. a in We've second then LOIs

So let how detail in approaching me capital we our discuss more needs. are

available Xx had million ATM great our the ended balance we $XXX We the $XXX.X Our the ratio with leverage was within ended in X our stated in sheet revolver. available capacity. well to of June, million And Net debt under end EBITDA at shape. quarter policy. quarter X.Xx, capacity in to adjusted

rate variable stood at approximately Our interest XX%. debt

immediately to So should we the Fed lower stand interest rates soon, benefit.

retire have we September, year $XX one private this of will placement proceeds. maturity revolver at end due million of We which the with loan

capital for needs capital maturities year year, addition pipeline. liquidity our this and plans for on focused in our Our providing increasing meeting next upcoming to are our

debt Subject focused change, options are needs. We changing market review to meet all continue our also on we our maturities. our to ongoing average liquidity to capital

debt options. public well credit options, as We're facility reviewing as our equity bank

access to just exceeding our we investment over just option yields X% financial also debt of over deploy our borrowing incremental X% equity, have additional we $XXX million to have leverage over costs and While the policies. the and option stated in without

some the We revolver on before expect our year least entirely options rely the of to execute not on at end liquidity. and our of

Let our full XXXX me now turn year to guidance.

updated our for midpoint respectively. Our full year $X.XX May of $X.XX $X compared normalized FFO midpoint, increase FFO and NAREIT XXXX million the guidance at and X.X%, guidance today an to improved as X% reflects or or X.X%. and FAD

future revenue previously existing As and retina and the maturities modify our and transactions meaningful GAAP terms that increasing escalators, either additional mentioned, will enter other impacts having all unchanged. results or minimum our I QX conditions our X-hour or we we guidance. our when positively our are such improved expectations, extending on into revenues recent rents leases leases Recall leases, impact with

released As from and concessions, unchanged additional updated from we guidance night from range rent and SHOP our impacts includes our asset effects the rent include continuing year-over-year repayments, our does maintains growth not last noted, pipeline. deferred dispositions NOI

So you once again, our all for today. That our prepared concludes call joining remarks. thank

for with open questions. the operator, So that, please lines

coming first from from Your is question BMO. Instructions] Sanabria [Operator Juan

Haneland. with This sitting Juan. I'm is Robin here

their will potential look work? of as replacement Blueprint, NHC on at the tenants or Just part

Could You're you breaking repeat up. the question, please?

Sorry about that.

as to or Blueprint, on at replacement NHC their curious they part look tenants Just going are of work? potential

an that a within the of their certainly renew Keep That's right NHC scope rate. at in to work. mind has market lease absolute

market determining So we're what primarily a about is concerned rate.

digits. growth Okay. the single in high implies half guidance, second the Offshore

are what assumptions is the and curious main deceleration? driving expected what the Just

what Well, cash but having we all talked the through improvements that the about prior terms We're last see lot what call. NOI. for to to in year, year. asking growth we work for the I But cash basis a is compared optimization continuing continue we'll that of that's on me, you in we've done. We've some think portfolio it level over you're we're told range SHOP primarily of think the tenants, coming of It's year. if improvements

Got it.

at point? On this guidance and you And magnitude? the LOIs, are could including they timing discuss maybe

you do that? want Guidance, to take

transactions. guidance any in definitive that's and but a been just answer doesn't we've We've policy difficult closing, to And terms effects on not to our is remember, Timing those guidance, have considered the include of included determine what LOIs. of closed Well, timing we more expected for if generally, right in do. now. our of that, had us we might concluding

This is Kevin.

a in acquisitions or through to lot a from will timing Just keep a timing scenario. bit. mind licensure a lease [indiscernible] will perspective, a of going ownership of include particularly if so It change dictate we're

we in keep to mind. have something So

Your from next question Anderson Rich from coming Wedbush. is

course. Nice quarter, of

that, repayment future you're rent is will rent is do in is presenting also of -- based you growth that for it, I'm new target that guidance, FAD the I'm to So recurring maybe you the guidance so a X% moving wondering think of of to mentioned a fair level today. in accretion you of FAD this of of fair be replaced about XXXX growth able of Or provide want terms unless but guidance. in the by the to is some sustain growing, because the But tenant be bit amount from growth not of elements terms as to say guidance year. us FAD that of external cash next but your year you'll that deferral you've it cadence just looking your sort a lumpy? that deferral to

quarter all through to go quarter us the helping are our just that items let's expectations. of after Well, beat continue

organic about those keep of trying program. little a talking CapEx SHOP on. timing uncertain. still opportunities is are of variety to The We execute a that this one. have we investments we're So

lot So there's not that. a in about guidance

reset great So the that's on past to another rents a several upside. about deal future our of in in We've talked tenants. the the ability

going their to all That's their to improve on depend NOIs. ability

to XX% includes one We rents nice surprise. benefit and our was have of about ability XX%, that in communities percentage revenue also from NHC the which

public So finally, now you might keep time. that a might a you towards on say some lot then just clues. same I And revenues NHC's place an information be we there. just eye pivoting we're can't exactly give external at growth as give of really would the you that said,

looking for So good is the future very us.

Okay.

a think, from assuming mentioned mentioned, assuming it from what repayment repayment you perspective? a -- million Bickford of have So portfolio you deferral entire I $X was quarter of you're the a number you're in that bigger terms deferrals. Do of for in

Yes.

unpack let's everybody. that, I been difficult So this Rich. know has for

tenants. GAAP are for are just collect of in those are percentage on sort repayments our upon well variety So of have we're that of scheduled recoveries Those that that revenue included We'll incremental basis their our are continue repayments to non-GAAP in to hoping have that stream. cash execute of a Bickford in not what the in our Those relationships. as revenue used accrual terms The revenues. GAAP some based analysis, your increase Kevin determined deferral that. cash component discussed, we revenues try are in our equation. to of sort those the But part and the we then deferral of upon guidance. But others sort Kevin as

Okay.

cost about of your talked like it yield on -- dry an future debt. or just your you curious debt. your back capital, has In into outstanding equity is how about just this into is to I thinking what Am that? you're cost year happened cheaper account. about which when capital of stock, you take than kind right of powder of seems on Or your activity yield, But the of kind terms if cost FAD your AFFO of you

of debt. closely cost time incremental revolving kind this No. of long-term of sort is around of an our We equity where is that cost interesting a our recognize pretty

recognize that. So we

$X.X the of small portion planet anything, But a of me, that considering. for up what's that, reverse from? you're you the you where makeup and are scouring Are just that came of of the inquiry sort coming curious, billion people for Last of with Or sight the line just options? is you actually with billion? it Okay. and to $X.X a is that component to billion? this $X.X I'm coming

the is universal looking the $X.X This we're I mean, the Kevin. is Rich. at things at, Sure, billion moment. that

we Some few trying There of never were pretty We relationships, needs. quickly. over meeting the dark. people that building an get their understand screened with element out years, were of to stuff -- will is out there last

we is now a for opportunities think people confluence guess, to, I are have and just are the better where exploring where capital looking looking us I better sales.

then And relationships good the have broker to that we in with. community have addition that, we do

talk So we operator over seeing we've year estate then the refine down in been X we been mix and few it's or our working we I on we've relationships much a just But the what's continues it more deal now. that that about prospects. building, flow market billion. than real is and about feel actionable to then pretty and what quarters. It remain $X.X over think strong the we that the a good of last been sellers last And think right robust, more number has

is Kilichowski coming Wells question next from Your Fargo. from John

investments at progressing help throughout in that been million of fee just -- the you and how Could today the understand looking about the or year? what's of simple talk breakout of us just terms that loans versus you're $XXX

Kevin. this is John, Sure.

call quarter, in about last talked more we As was nature. it the on XX-XX

long-term loans for we -- simple, direct a in towards are didn't There give fee to opportunity a think simple out we there estate more skewed percent it still and convert percentage, or us ownership. more Now XX-ish fee real it's would nature. it's where probably some good is but be definitely into more

open. we're that So of business line keeping

more as always talked think including be again, way, now, And about need-driven Our said, going we're we communities. preference looking in classes asset own. specialty to it's is I independent skewing nature. type that housing hospitals, That all right more at behavioral, it's to some -- senior

for matter, a mix too. right for good skilled us now it's So and that

Okay.

interested those about larger of And is it think the kind just you there. the portfolio XXX line question the it? keeps circling bucket, I million what to maybe then it but you on the the right towards billion way guess, putting back more you And just What just maybe levered $ does to last is you're it, have differentiates that deals that in them. assets? SHOP some transact $X.X And or include on from side? to the ability Is it think in Okay.

what think fair. right I more is, at again, now. One of that's point we're of looking universe the

will and a in it, we it's not flow, negative right be not It might the have interested it where building be out. Some cash a or operator. or newer of market again, screened we're might something have

need not. out. that type on include the So fit It tend Those venture looking things we we're that to which does portfolios. still will it sure and are relationships to that joint screen the work at, be any or of make bigger they

So to some want business new line is we to in us signal sight a better its we're don't new having of lot without business for -- line that a respects. we're execution. doing RIDEA

have sure we We right, get to about portfolio talked now, SHOP which before. make want it the we've we but

take we're going swing It takes So a a extra like scrutiny. little that. big to

last one for then And here. me Okay.

number how out reporting Have the drive waters? peers testing rents that you it I some you those and On I guess, hitting really pricing talking to ability to pretty here? drive power the But start are before we're relative the to should SHOP here. strategy, strong side, who think about XX% been understand about occupancy occupancy your we

hoping try you have Or to power, you're there more than -- sorry, decline synthesize a testing XX% not occupancy here. we're XX% you'll realize Do think getting you you and push? than to bit that having have little seeing trouble this that Or have tried is even but you're just Like a you're you're like there to RevPOR get occupancy? it? now that -- why because to trying not have testing the pricing reason room you other waters to to is

to you're going That some power market XX%. market. others. going capacity as have as is are in think not has There to to aspect said, be strategy just let's where much been, the I pricing get the by

the to more. news starting that get at for or us, of are buildings incentives XX% are a X or probably to is buildings falling all That's And though, are off. We see there. level. handful Good some of are our buildings SHOP individual X

made So significant there. progress we've

we expect would see bit start and get more those to once those see should to to some incentives some to jump expect we off, margins to mid-XXs, of So of kind stop the XX% we a closer offering short-term incentives then fall would of -- see and rolling see expect again as incentives off. we those

we the with So strategy. stay wanted to

think I us. for it's been effective

to Our strategy operating been rates, pushing they partners will be but on kind dedicated market where we've just of first. the can the

John, we I independent John know same oranges the Can add care, living. our peers a apples more memory And who was because just I and component. our bit quite strategy that that Spaid. if our that little question don't are of to you're a comparing portfolio because be would is AL lot portfolio this is of pursuing like the

next Your from is Instructions] [Operator Markets. Austin coming KeyBanc Capital from Wurschmidt question

as a kind the of any and their of and deals And opportunities perspective? kind of back to in point how time? singles Because you're given just economics being where RIDEA how on an recovery margin that like they guess, are opportunities in to want and go in and Just what given curious comment your there's sounds doubles take of the both on well of pipeline. it as And much, front the sensitive you much I occupancy the underwriting mix from willing you? some are in of at selective maybe portfolio some to are to investment

thought We we've where growth then of of profile relates a on sight flow health looking skewed generally towards to entering we're approaching pricing let it in that. not been also maybe more pricing with think power us there's as what line the the John's start to But it is to What good be XXXX at capacity as side. years, meaning than seen is numbers here, not where we're a some with want time. to still a also prior there some level entry weigh speaking, stable, at paying there again, lower of I they're increase gives we're in of huge that good the for delivery and looking senior have to and care going a kind to the that per there kind over stable. reasonable need-driven in prior cash comments little us are and needs-driven something the piece. I'll but labor quite upside margins stocked power side. The a We but think, communities is before, Sure. housing price we've John and margins, similar which kind but about little with, relates point at, of that good are a what fully gives unit

now. ago, now the looking We're of differentiator we on little better a and is time. be a that bit at in rates can these upside believe rate to in little yield, the portfolios still I years we're capital is enter other of of We were be today of just they at we stable a get what is some just purchase looking deal mid-single-digit in yield our at, so a a a excess and And few growth to again, value-add. really can rely and of looking cap not a for to think over RIDEA nature. think the I have more on that profile reasonable interest that's in cost would not us our thing that going big for much

all that our hundreds that past, portfolios we've the go look you we're you looking there's at of see in multiple kinds at of things executed But terms on millions of out of in So dollars of if Austin, capacity, the there. past. history in can

secured we're looking that some debt with we could come larger transactions of So at, some these of assume. them

So we've so our credit creating very mindful without on manage to structure, secure issues investment been any debt our rating. absorb capital we could

we'd into the properties joint to enter like venture. of Some

through. think there interest equation an to there's noncontrolling properly so regarding So have we

lot have larger we So structures But through. some bit these there's capacity of goes very feel that of of deals. a of we're They're on like terms different. we these into all transaction RIDEA thinking to in a things capacity, that quite

just maybe the -- monitor RIDEA a And bit a the of the more you perspective, still past, right and on in-house you we've good talked corporate build about day mean, little of infrastructure out from a the need help portfolio? take of this people have to bit but sort can and I kind in

on pipeline, some Austin. larger we This lookout question, that. extra horsepower, on and is help we're No talent to That's asset we'll a new accounting fair need execute management the with Eric. always the that to doubt for if and hire

if debt just great you then more Fed down can you thinking I to even the shape lower you me. down, pipeline down your range the if the about managing for sheet, of to could end be? in kind the are on And the talked to fit of the would as you deals cost build that you're ahead the mean see of today, and coming balance continues willing capital one of to cost improve. but time, variable continue And rate but need and you way? how go line of below though John, just last capacity some that build of that additional leverage you come use your of if continues about and debt pay certainly your

We not way. of our any try sheet a to allow to headwind approach to Well, let's it transactions. our balance just be this

rating. do try to ahead take of we stay need maintain our to care well what to liquidity investment-grade of So our credit to needs, we

make we we're sure just to hard game here. the So that of really ahead work

in In liquidity shape. it's great right our now, of terms

from also us, things and our to a But sources well for ATM of lot we've capacity ample our getting have revolver. as We be I mindful as have better that got we maturities. have do

and we entirely there's rely in So to of be I forward. said lot that as and a that just of, to ahead market-driven our going to we're that's a try stay just going decision on my not move going remarks, we're revolver, things it's prepared to why

questions There no queue. are further the in

at you look attention and NAREIT other or we some everyone, forward today, seeing for and conference. Thanks, time to your

Thank concludes you, everyone. This event. today's

day. You a have this you for time, participation. may disconnect your Thank wonderful at and