Taubman Centers (TCO) 26 Jul 192019 Q2 Earnings call transcript

Thank you for holding and welcome to the Taubman Centers' Second Quarter 2019 Earnings Conference Call. The call will begin with the prepared remarks and then we will open the lines to question.

On the call today will be Robert Taubman, Taubman Centers' Chairman President and Chief Executive Officer; Simon Leopold, Chief Financial Officer; and Ryan Hurren, Vice President, Investor Relations, Interim Chief Accounting Officer.

Now, I will turn the call over to Ryan for opening remarks.

Thank you, operator, and welcome, everyone, to our second quarter conference call.

this of we'll federal during within forward-looking know meaning the securities you conference make call, statements As laws. differ although These with statements results performance respect views may actual to future reflect events and our materially. current financial

Please see SEC our and discussion XX-K latest uncertainties a and underlying subsequent for statements. various filings reports including and of earnings yesterday's release our risks our forward-looking

on our this In will be link replay website. a of section of call the a Relations addition through Investor provided

non-GAAP comparable financial release, G. when discuss as measures During defined non-GAAP historical Regulation this also our our call, included SEC measures Reconciliations our and financial SEC by we'll earnings are information, in possible measures GAAP filings. these supplemental to to the financial

future investment after-tax of not to tax from income Non-GAAP the interest FFO performance depreciation Such and/or properties. the has EBITDA, net amortization, for NOI, of which may measures this corresponding estimates referenced on differ periods. our NOI, due future management and quantified non-GAAP call expense, all forward-looking measures may measured significantly some or and/or GAAP of expense, include

we remarks questions will to the for questions. call prepared We limit ask two. today's Following your up that you open

again. have queue you please up more If

Now, call to let over me Bobby. turn the

center Juan. with basis rents, drivers morning, primary good growth growth of Thanks, Ryan, last XX $X.XX this our Comp San better of quarter growth our released with FFO The We recoveries, lease second Yesterday, and were everyone. NOI proceeds cancellation and produced we results. lease adjusted expectations. earnings income, over solid up year. X% line was insurance excluding cancellation in points, up income higher-than-anticipated

of impact currency, was the NOI X.X%. Excluding growth

year-to-date. grow and portfolio significantly total of X.X% pace is X.X% XXXX. top a share at of X.X% on in in faster the growth rata NOI continues up pro to quarter This Our

growth San year Last in drove pro in Market the are factors. that Developments our rate. ability rata primary in grow The with Hawaii of are non-comparable the as Palm producing we question, are assets when and NOIs our centers XXX% solid Center Place At Asia and Juan to of mallers International best in along year owned our of Mall the numbers. stabilization addition time This a Beverly Gardens Beach well our as the growth

due was Average On this rent it per up square comp basis, average In X.X% rent NOI up weighted was X.X%. per our up foot comp NOI an XX.X%, quarter. foot X.X%. $XX.XX slightly square X.X%. our our occupancy frictional up China assets. centers, two an was to On XXth, primarily at center comp weighted basis June lower U.S. $XX.XX, was U.S. was vacancy year last At than

leased. half XXX% recaptured the first of year, are X% including CityOn.Zhengzhou between of large both Forever and X% of the the which XX we stores proactively GLA CityOn.Xi'an at In and two

APM and Great the international spaces brands in second Opel, XXX, like Bose, in Secret Victoria's Sephora, XX Forever will at Monaco, half be opening Nike, this year. centers of the these

was sales above year. merchandising last in tenants history and and both the centers. expect is centers in with space NOI line this be add the Lease of square XX%, of time year to accretive to meaningfully foot These will we'll comp for per which in we recent

Including comparable per trailing were up were XX-month sales, foot, up square XX-month centers' U.S. in to sales XX.X%. XX.X%. sales Turning the $XXX trailing $XXX Asia,

sales weighted NOI basis, On up were $XXX, an about XX%.

Tenant per now sales have our comparable all centers. in increased increased a quarter, square sales For X.X% XX row. in quarters portfolio the for foot

few a growth. impacted sales again factors Once

quarter. extent lesser added, than First, Easter Tesla's April's vehicle a but to last results. late benefited deliveries Also were

were account, the Taking centers our against comp year up a considerations were In at Tesla, good the into these by about produced offset reduced These still by strong growth partially we foreign unfavorable ago. sales tenants rates, growth from Asia X.X%. which X%. exchange U.S. our excluding

Fabletics, Aerie, shoes like Lululemon, to Ferragamo, individual electronics, and Louis perform Express, Apple, Eagle. Zara, was included Van and and The Fitch, well. quarter Microsoft, American H&M, Coach, Abercrombie consecutive the Choo, best apparel, performers continued importantly categories for Key Jimmy up seventh Vuitton, which &

with expect the XX Nevertheless, could we locations Last be year. very closings and by little impacted in could impacted. since quarter, retail has we of store stores disruption industry bankruptcy tenant persisting. points occupancy. to XX bankruptcies expected additional and been continues we XX that XX close, locations bankruptcies this those, Of There now be identified representing about basis

In have addition, closures. XXX Charlie's, announced chain-wide Charming Dressbarn and

close, of consistent about have with XX We approximately be expect these of occupancy with points This our points stores for basis XXX we total, to representing now year-end. all we roughly and will which year. expectations backfilled the XX occupancy, guidance six locations is basis In by three tenants. believe

for lease concepts. with centers sources up brands, we space, merchandising of new improve more to productive Digitally-native As continues space. coworking and demand and the our the and food growing evolve of remain luxury,

Louis Gucci centers. Aerie, at at City Palatine Green had Paseo, Hills Hills at Recent and Golden as Hills Fabletics, number Veneta at as Vuitton Bottega well Gucci names a Casper, and El Green and Short include Goose Creek, and of

now fact, dozen centers. in digitally-native we over brands our two In have

Rack the May, Hills Country store At Great next Nordstrom we Detroit, here In Crossing, XX,XXX a will in coworking upscale join lease after of operator open square-foot signed Club last Plaza Kansas industries committing Lakes in Short a announced spring. City just to suburb quarter.

floor. Beverly for center This NAREIT Beverly's you're concept great Saison of Angler in fall. Francisco you addition three-Michelin-starred Chef visit with restaurants to San team At We our opened founder be the this the a month. of Center, encourage LA when from last in seafood-driven tremendous a collection reviews will on to new the first Josh's unique

call turn to Simon. the that, with over So I'll

I'll per the up X AFFO last you, year. Blackstone was Bobby, the these Adjusting that supplemental. this $X.XX begin morning, shareholder $X.XX, with of by items, variances page good related deal everybody. quarter the includes $X.XXX are result year-over-year for $X.XX, and of for Thank for the pending quarter, the FFO to to reviewing transactions. costs share listed on two of FFO and compared was share $X.XXX associated activism costs per second

due up higher canceled this of per were income was minimal the $X.XXX at year last had Our termination quarter foot; we minimum the a whereas from received termination in national year-over-year income Lease rents restaurant AFFO We recoveries to variances $X.XX. second the up net single up quarter, $X.XX. payments include rents average following: large concept. square footwear location

was $X.XXX, as higher and to expenses operating as due were lease redevelopments. reduced change unfavorable on to the due Other expense rates $X.XXX, developments Interest and by well accounting. borrowings interest in unfavorable capitalized largely

The The the of three component in an as Mall interruption centers which Though of variance Juan, all centers, the non-comparable Mall Beverly, Mall San Gardens release. positive $X.XXX. contributors, this highlighted of we our were the Juan proceeds Next, earnings include were aggregate of Beach business in San Palm and was at largest

that receiving Lastly, our non-operating shares dividend Simon the income no in fact income liquidation following longer was the from Property the unfavorable, to we're largely due $X.XXX Group quarter. first

I'd rates restated, the on for with currency our so of like on period the in year-over-year Next, of rates exchange are have touch accordance GAAP. not results. in Quarterly rate are the results that quarter impact quickly to results average our Every exchange translated impact. centers exchange foreign an fluctuations at Asia

impacted our XX center basis has basis points by points In our growth. center XX quarter has to and this year-to-date. basis year, XXX trend growth That rates NOI comp reversed this added XXXX, comp negatively points favorable NOI FX and

on corporate has at the been taxes a impact rate average our currency Further, and stated the expenses, favorable we NOI offset While has NOI of on on business. had big the growth about this as the effect on NOI centers by unfavorable effect year, own expense while XXX%. FFO center to XX% our is is comp these interest related negligible impact Asia

disclosed rates our quarterly foreign Page on and exchange As of a the in of NOI XX reminder, impact reconciliations our supplemental. XX we

This on an Now which Blackstone associated impact be guidance the found can of on X continues and exclude of guidance transactions remaining page the refinancings. supplemental. to update the the

$X.XX of bottom $X.XX, We an the now the adjusted to expect in to $X.XX share per of to range increase range. the of FFO be

Year-to-date comp comp to NOI We X.X%. has expect excluding NOI about FX impact growth center growth the X%. been our continue our of to be center

Our been our year-to-date as said basis growth this original bringing year-to-date If our impact an we points from at guidance could guidance has X.X%. NOI points the XX growth continues trend basis unfavorable of to contemplated impact risk. XX rate FX but be

today. adverse will place similar outcomes remainder we given we year the at time for this reserves what last sufficient be year tenant know these in have as the that We had we believe of for and

continue. assuming also trends tenant current we're will sales Finally

Before turning price the of to to call stock the Bobby, briefly want comment I our on today. back over

than For of NAV the in been price. is has number years recognition now investment our that community greater there a share our significantly a

price value have preferred price at market quote. for as yield share XXXX are of and well end the our rest applying That's than share is and getting XX for call including on X, $XX earnings fewer our debt represents November means as used free quote share the today's a portfolio total of much with at a stock. said in as whole our rates "our cap the On that That we investors cap today X%." that at a analysts as dividend least excess as of assets of about assets, our this

very to an estimates for just we analysis. in updated sales XX upon amongst growing today's have NAV for So assets of the include and you and our share $XX allocating debt today's of of the assets which call, interest equivalent the appropriate roughly NOI. level rest price cap free company is assets, many that which of using built rates means this anywhere market get in are and the with preparing Today which of best two

has a increased a been also that XX years. dividend has never X.X%, in dividend times You're reduced above getting XX the last and

average have is With to double multiple at which our Bobby. NAV times is are a about times. at multiple XX nearly today I'll on turn lease back trading about it and premium an which that to XX current Finally AFFO

Simon. quarter. had Thanks We very another productive

and great opened earnings Nashville meet in expectations. a of in our Palm the U.S.. assets high-quality in Mall elevating are the continue fastest-growing in allowing Hills expansion in our Green asset the in another markets environment best acquisition one We've Florida. grow completed Our of Gardens mall to to the the in the We Beach us volatile quality of

open year. Asia in with late on also of during we're year. of to is this In with the remain second next components And new South close Blackstone, to in half all which enhanced progressing on joint we schedule Asia the track Korea development well venture our

We continue our our our grow to improve company. the and necessary make balance to sheet decisions portfolio, strengthen

take to [Operator Instructions] questions. you your happy Jerome we're there? Now are

Your from from Instructions] question McGinniss Greg [Operator comes Scotiabank. first

live. are You now

to pieces guidance all Simon FFO with adjusted exactly morning. good moving on I'm zero-in trying the the Hey, just on going what's there.

well as quarter. You've got expected that the insurance and also than interruption comments uncollectible you've business details appreciated last on higher of got that reversal rent. be versus some the would Then

So what much to I'm items? line that? that just trying that that figure FFO two impact the was the year how changed How of from much line -- full those from item from out impact

maybe put this year before let's proceeds. our insurance got which would Well jump interruption have in left of business the the We $X the proceeds of bigger we million of of for million the guidance. expected year. the talk first into the picture that $X sort into of about million remainder We $X quarter

about $X.X quarter. second received actually million the We in

the that $X So about and but more, think you $X.X way total is goes about outperformance right We had million. any million the at $X.X expect of would million our into versus I in guidance AFFO. versus don't

Then expense say We would we in raise a had take proceeds that half the us our half were terms at the accounting, $X.XX hurts to about second end in XXXX. the to which AFFO in of $X.XX the is The clearly had when the up part than the of allowed million that second higher half. midpoint lower the and I'd by that's of there from in first The we our total per share, which And $X.XX in in expectations. XXXX that's than in looking in range expected. predominant and reported stand-alone that. we year change general, lease bottom general $X.XX half. of better $X good we're interest last share versus year, means the there per difference

potential have to outcomes see environment. In higher We're some push as but to retail well. reserves see pretty the really there that also portfolio potential to we in volatile felt us some but the of assuming now. negatives negative are to that range, pertain health, we'll tenant are way. in the place needed it's the our Tenant right the we that to going in We address incorporated like sales back we stay we about year, could have that negatives all good to believe appropriate The that. be half positives end of

cancel I assuming at income We're in lease year our million share we're $XX for million but think now. now there also we're $X.X at right right not the about

get So drag worst going on we're clear but have not to the could all it's not of It's world it to problem be AFFO. the our that. a in

the huge are pie terms reversal, it now In be. of right to we it's as where debt a bad where piece to the of we not relates expect

due Yeah. San Greg, quick past a Juan. sign insurance flip to balances The flip upon methodology cleaned primarily new any happens had the up. debt under due this unexpected. on receded resolution the assessment business is on Ryan. bad for the to accounts bit there of at more finalization potential in collectability insurance that several a Both Real is of the was given little not the with the claim the – that methodology We were old interruption that and period was It quarter. each that.

it's So us. a – no not surprise to

the Okay. talking then points. Appreciate it I that. of trailing about the was basis number just a of a bit a just total short-term on you down call rent the think mentioned X% question driving release deals, split in XX-month here, follow-up and XXX little small And

do into next related more of negative be deals were deals So curious, over exactly these Or heading I'm what kind the to? expect you year? territory? just of these Could

the for merchandising in portfolio We important which for all make especially quality have in given us and to centers we're they going manage said improving are before, volatility. We it's and of small an it those any reiterate. NOI for occupancy continue to are quarter but choices. for to can Spreads our a output relatively really

There stat. that to average and a we about of we important of growth X% have small which We – spreads. think average is said X% you more the hurt rather X% people is or this. XX% that deals rent means that producing really point continue to opened a rent about leases than are number stat That about the signed less

If about you then add that you XX%. weight NOI

healthy. So it's

not It's We're are we're in with the centers still short-term that some the generally doing portfolio. helping in with us merchandising. and them doing NOI helping strongest us deals it's the

say small at to But if portfolio number short-term go stat. to going up with spreads to one those relatively do a we're it's So hard continue to of is all that. it Exactly factors. really deals start these look are it, small that you that weighing down

Thank right. you. All Appreciate it.

Thanks, Greg.

of comes Your next McElroy with the line Citi. question from Christy

now You are live.

morning, Hey, good to wanted the question related follow-up to Simon more but specifically NOI everyone. same-store just growth. Greg's on

are a the sort FX talked you of but previously X%. point greater or had effect risk but basis about X% saying impact, XX You obviously now could be you're reiterating that the XX

X% be going for XX that. Or because impact year So it the the the no is I greater higher than kind seems to that higher? growth could Are rate ex-FX just attainable could like wanted full that reconcile FX to saying of is sort be you the bps? of core the be that longer

not Christy. Well, really things of either we're saying one those

of though. Let take me pieces sort in

are NOI where expect year it for on be We excluding comp right to we FX. the

Our the year guidance -- X%. about for about was is X%

tenants new Excluding half positives do actually for tenants the a the big much of second the and the in back of Hills rents expansion, including Xi'an first opening number the in Green see in at some X.X% a in of half Zhengzhou higher and FX We year. in half. rolling we're the

– incorporate don't having into point points drag I'm the be could if of drag the drag you'll we dollar be stronger about one basis it but sorry, our X%. on them. guidance, the If weaker we're basis We positives of on these we see year. factors half continue we by start a XX see basis did the a a XX – points see definitely number dollar would at to end-up a XX number. of levels a about don't And potentially potential offset for at is Those FX

So risk there. is a there

which including consider over's sales quarter. generally in always – assuming our to well that important fourth a be We lot most environment run the factors got we We're because of get sales environment continues positive. have other as you to is the

at comp that will on last have the we depending to reserves also we our address that see. It's $X.X even a year a half second believe the portfolio large growth. It's whole. pool still the as create it could million time drag to relatively is everybody, what NOI some portfolio to one least are is important of have We it's to sufficient We but year and this in tenant had a have do smaller that place at center be we're center and going than that to drag happens. in X% comp similar on reserves also small remind

a doesn't take the volatility. it So to lot change

sales think X% still stuff we basis a a lot the about. originally line, about But, out worse, lot XX there. be currency Christy, kinds shot context we still goes X%. is that about and even of get think the this than make currency good to stuff. currency. X% we X%. hard can can But planned, then with of think a very the us to hit, of we There's a of dose actually But very issues, for points noise of we But there's there's big tenants, make be the difficult more we there's bottom have in all talked continues to If will we we that at it even even

big pretty a to And Forever specifically, for mean, to with related that, exposure I it's XX, just regard you.

scenes? can rent more what expect adjustments? about Are be us a for about sense for but should they they they've actively the closing that going looking from about the any thinking sort China assets, from hired you XXXX talked And variable give talking a we that advisers, on XXXX they're resulting behind term? what's doing? in that Are stores? should impact we given maybe near this Is or of You

comment Well, generally don't let largest specific me that Christy, We we in XX tenant. portfolio. our Forever on that say, recognize is tenants do our

Europe their their did lots things and a portfolio The they that speculate points. majority are So There are can make very on maybe much we our China I have certainly of we are and in in to well. it Asia related worked of with frankly expect reports higher two that We published are and proactively few performing challenges to the and stores allowed did backfill we large -- much stores mention really that format stores. has better us much, rent. merchandising they

We Now that XX,XXX XX,XXX including of Mall opened our store XX a at locations, U.S. former brand-new XX do square that don't have any that last in Green of boxes seven an Mervyn square-foot feet. XX,XXX store example. a the out of the are couple have as between Hills -- stores we weeks, opened The and

We yes, reasonable and a But that see a So, is and NOI our what our this very our tenants. have situation. do to of fluid ranges outcomes all lot FFO is say, range for there's guidance of incorporate, believe I'll we'll uncertainty. a for tenant, it

color. it. for Thanks the Appreciate

Thanks, Christy.

with comes question Your Hill Morgan from Rich of Stanley. next the line

You live. are now

guys. follow up Hey, to Wanted just discussion on the about rents. good morning,

for X.XX about One the about consolidated was, looked like of things year-over-year that rent down from the the based was -- we're assets quarter growth it noticing X.X%.

But between you if short-term wondering, could give into the assets growth us leases. assets? the what's international that? NOI maybe U.S. and Maybe it's driving also, any the I'm insights So

Rich, Ryan. Hey, it's

we that explain our in -- we tenant issued credits we Juan. consolidated release result a things proceeds, as business the through of, but credits centers of, offset of tenant line are revenues the the of one the for is And have really, did interruption paid One through in press item. the quarter, ran some for where rental kind situation the the San

foot. consolidated per lowering the they effect have So of the square rent

specifically. seeing item line the that that's year-over-year consolidated, thing really so, biggest in decline you're for in And the

it. Got

San it's we shouldn't reflective It portfolio. thinking of by X.X% Is that that U.S. is And so, sounds Ryan? the Juan. negative like large just fair, that entire Mall driven of be the

so. think I

Yes.

fair. it I now. Rich an the happening anomaly center in think it it's is to The look at to right way is, really related what's

million then, related right? guys, transaction, Is it. I bit And I think income a $X.X And Because the to the saw little didn't that had a yet. maybe Blackstone question, including Got but that? think costs Blackstone expense. related we transaction million the what's tax of about to technical driving closed $X.X

Yes.

it's view now, them Simon. related separate million required it Rich, consists have transaction. charge the in the are transactions second both closed. under even So, of we're $X.X deal to essentially them Blackstone two costs items, as of recognize quarter, really GAAP though We both The the not to and

charge first The million fees. is, $X.X about professional for

relatively simple part. I think that's the

the is complicated, charge million but specifically. $X.X a deferred that, second to expense sale is version assets accrual related tax the the for China The more it's of simplified

expect those We upon would of that withholding closing tax a relatively amount the of paid be to deals. need small

really the If have for second part required the day deal is sort a at of a and in accounting of closings. the items tax deal the quarters, and It's timing a end closing of really a number of item serially time, number deal really deal this it Because of quarter is this ahead to been of record nature. point the a closed the issue at of over vast we're they in cost. single would

Okay. it. Got

my questions. I think two that’s

So back the queue. I'll in get

Thank you, Rich.

with Your of next America. question Bank from comes Schmidt Craig

You are live. now

was any I international are you level you. wondering if Thank shoppers? the on travel Great. impact seeing of

seeing of talking little about regulations that say generally some in Florida all issue Los San We're a even in would the Hawaii all up. it given generally is yet as we China about I place not has in the and that on tourism Juan the in though -- issues seeing Angeles, that Hawaii but in in were travel, in are you're tourism If and shopper bit mainly not returned. putting tariff Chinese the are really U.S. the

but see as of kinds will on are of tourist to half then go hoping season year next to into the holiday of return first Puerto that this season there get begin well-publicized this issues we Juan, in all tourists and the there. for Rico we're the San So we

And I less you year this the next in will hear retail, of store the do similar? you or then, closings year state Great. to think but on be caution relative

they selectively has And headwinds. my complete desire Omni-channel be is footprints, to and tenants should really less. understood Well, of brick be and it all going awful three And it's be really been Great would these digital be of of four now very shifted. order brick of it this guess last footprints is stuff. their years guys said, There and in has to best want very sorting think never guess in to guys that and is had a mortar that. want have In narrative will an mortar and the the aren't locations. the be I stores, forward need big rare a they clear. that lot four them really to the in build are their store, like is to be and X,XXX raising all out focusing but so capital come where instances retailing the are new all legacy the again all and on years

it's or So seen my the guide is four three that been years. but worst, we've

you. Thank great. Okay,

from comes with line question next Your Sandler of O'Neill. Alexander Goldfarb the

live. You are now

Good there. out morning

questions. two So

First, land and with buildings.

continued of guys for cease-fire, for next then year. paid settlement, but that balance a like you a You out what be guys seems announcement be but settled you had the year, some there'll the seem -- was some they it telegraphed relaunched – like there expenses you you obviously, to then campaign put a an

with they one, they could -- approach? of: you new highlight sort to if bounce maybe So just are got their

of just And for cost the great getting level expense, because clearly with but to the it's obviously activist, shareholders. it's an then two, involved a lawyers,

of is So are And just for something this balance of And the curious year should budgeting? to for your impact what that we next you're the year? expect numbers? sort what thoughts

the let's first. expense piece Alex, take

quarter settlement included cost $XX to and that for million and reimbursement had this a So a million we land $X charge building. payment

knew in know, highlighted we quarter first when it's it us It's in our I investment proxy. which they why GAAP in to We the quarter it -- the our take take in the included these and community know, we is payment As which you that quarter. to about we it call. we requires last are expenses incurred, didn't had our

to addition That's of we $X in on charge payment, quarter. like. million and first $X the incurred for the in of million expenses fees professional $X the top a So million

as were cost some and the million the XXXX So taking two year retention little of together expect the midst average back We you some of expense a settlement, in a proxy million incurred do awards additional advisers. the contest. in bit of of in an amortized million to we finalized payments we've to add those compares annual when That to $XX the $X of date. out $XX.X in and XXXX, we

don't But expect to previous than we be in years. overall higher year, the the expense on

be but to date, to expenses, that really total in think tell bit to likely guide can remember think this the either. we be In on up is $XX at these million these started million, fact, choose to expenses end we I it'll because you $XX fluid, they a $XX We tend proactively don't lower. we'll XXXX million. since didn't we have

So Alex, what plans buildings huge money about let will me be. land is any I and can't add. make And amount a huge. of comments It

-- but you. amount So of money. with gigantic we a It's agree

know lot is. mentioned call And portfolios. stock you you industry and people Bobby back about in Okay. the NAV, yesterday Kimco Forbes talked second the where for that obviously you a in the Simon, there of the others And their talk is with in then, about coming where question. money is. stock

free get where given far about bunch malls seem the and guys What that NAV or are stuff of sold are looking to could the you Asia, at because inside thoughts private people people the market half the and seeking market talking hearing for as doesn't you of be of probably the to as is company a to something pay just of you going upside. of the clearly any but find

your very guys The negative. your from market you and it comfortable on numbers. for only the to your ability and retail seems sounds to closings tone like year But with the are the hear deliver guidance potential landscape

on what privately? something maybe your thoughts So, are doing

I'll Maybe over retail a jump It's XX% excellent an clearly clearly call the few run. last public about challenge been run CAGR. Look about good The as XX no had in that. first a a doubt it they we've have years for Alex. really years, There's landlord. last though company

you buy we be able we to that really good to key in price think to just done. an partnership a liquid have an advantages are getting we if were what public. think Gardens and I a that the is asset because interest deal, was excellent Beach units mean There in about Palm

So, focused clearly, improving is remarks. prepared of portfolio in We about very sheet on share and talked it NAV our here that price growing We're we're quality in gap. NOI on the the very focused earnings. an there said, balance strengthening

decisions this nicely of we also bunch the X% the a growing Asia that and just that at we about. which We're And recently proved talked made of I the year. about about deal our acquisition year think far same Beach thus Blackstone NOI and Palm on including a

value in trading that will time as have share example highlight -- Over assets. decisions remarks today believe in prepared that to deep The help price is discount these on of the to NAV effect decisions used our our the the price really compared a gap. we and close meant good good positive I the

value everybody community. more recognition it's at We think important important about We highlight being price for to this the of compensated with it's than a think broader that that away a of it. yield in investment X.X% are investors that knows

widespread how us uncertainty our with I that of about right over to it to of be It's don't now performance the but it's we think the general winning quality retail we're the reality and specific doing it's today, is our seems forever. think in portfolio. but true reality going true

help balance advantage the to the real And grow and the about we've fix the do that's there's context to able we better company fighting and which some think good We think going that private. fight We're highlight. in so sort the make of sheet. portfolio been really

you. Okay. Thank

Sood with Shivani of Deutsche line the from Bank. comes question next Your

live. now You're

Hi. the quality that Thanks. We portfolio guys you in U.S. the recognize have highest

and negotiations are the conversations terms us occupancy what even be these tenants of willing is how leasing impacting of pay are to you it or give of where a in sense given may progressing? terms if vacancies Just can in

good and at and strong a XX% that occupancies of expectation occupancy. demand assets. good for portfolio there end especially our I as are we're really actually our our in the best of is year said range in pretty Well, pretty is that's And

food shopping centers. continue across-the-board luxury talked seeing And guys I to in very, are wants about mean food footprint. industry for want I the their the and native guys to demand is that luxury. best the from well co-working The -- our digitally guys very excellent very we're doing continues that now be to Food strong expand

the we're where point at It's our year -- on of this XX% So, finished complete. budgeted leasing.

tenants they into went X.X% So, low quarter. where we're look this with bankruptcies, very roughly our happy are. at you we bankruptcy. of year-to-date When in you were When think

ever the a for X% lot about be up tenants. the would it The basis years been question that seen not X.X%. we've to earlier X% worst do of is In statistic from think keeping out that year extrapolate been it's of as it. for -- the X% We've Craig's I anywhere you seen. XX we've XX now points the answering worst the and If

about out of XXX about XX% is going So, we closures which but of occupancy, that. comments the the we're in XX-store basis to backfill think about of said bankruptcies we we points expect

it. we're feel -- I good and seeing like there's we're So, demand

the rent at. growth in your time. cash to over flow that And cash thing see really grow. flow going are the typically to seeing It's we if which going is growth good And portfolio look average growth rent is we average you're key really

feel So, what better Shivani, think you suggested. than I we

Okay.

another Shivani question?

just just then thinking in the of GGP how Sorry. how talks Yes. And you envision just hold Brookfield at open terms end your regards switching with you Center can expected that that going might that to comment long-term this impact on the a center? Or with forward? to bit year of the of

expected expect we of facing the performance near the lagging less -- We center as than that is Well, rest is challenges of we clearly as the SoNo opening. we NOI. portfolio. its the are took and does X% If

have one less would if from But out. taking the income is exclude been overall comp center it we Our share NOI basis than growth X%. points that growth NOI our center of XX better just

focused that we're very situation a is it on. So

Thanks.

Caitlin from with Your next of question comes Sachs. the line Burrows Goldman

now are live. You

the Simon, dividend mentioned morning. remarks and you Good prepared Hi. the earlier in your dividend yield.

So increases? that I payout for does this room leave how was continued it And wondering topic just ratio in forward? And what be should on about dividend does management think dividend XXXX? going the

Well, we're to are I liquidity with say level your think front given current and for our you upcoming given the we at think want about right in when we're our midpoint I about but you dividends, at would XX%. needs. what general We're in capital now get year the of talk Board never our comfortable

You'll that the always kind we few grow ratio. and years expect sold remember we payout it to will were we lower of seven into before that Starwood than centers back

dividend did accounting at our We said big the So the just dividend everybody increased and higher bit in standard earlier like Board. of raise this don't little is of new of accounting I lower want the ratio FFO year never was a remind times. your get you really so that the cut we front our to slightly a piece lease We've because we've again day. it. And XX end with

at are comfortable we So where at level we're today. the

post-CapEx the you think from And when do still a post guess I XX% how on in it -- much XXXX so point? on you basis? you that think guess about it a I about think if increases do

pretty I a expect that to couple XXXX and be really we in Yes. said in point. mean cash getting free times you're of flow cash XXXX. that sparse free the potentially flow We've in

capital increase as in AFFO and we XXXX a development capital intended tenant in flow to well deal to the past. of our will pay our and do cash to starting we result and free grows are beyond end we're finish and from the Hills dividend terms year pen they've that Green the forward. that up that a no payout grow this day expect and spend have ratio at in start which we we liquidity that pay definitely today ample paying been do We Anseong going what our finish with to and like allowances As But feel the ransom dividends will to come cash of our ability of is grow of flows. lot down as pay really the as we

meant between and debt And policy our And in to time and the is that to times talked Blackstone we under reduce be stated remember the times EBITDA. debt is and X X to Xs. a long six somewhere be would we've like transaction

quarter. the So we're very to in At increase last focused on Board it felt the as time that. the did the same dividend very confident just

the occupancy Okay. backfills that the And second for side in Asia good think detail on you of half space maybe pretty think then Forever I how had I some and coming in gave you XX space. similar just U.S. the some

later You were backfills this talking some about year. coming

So I some give space. wondering refilling line in compare was users? that how rents if their could previous examples to U.S. to just who's you those of you And expect

These guys. examples, spaces. space mean I mentioned of it's to that these a Well, the guys they're ready some don't are mean I mean, in I lot but mentioned going the -- Fabletics now. want right digital I have I take it's really across-the-board. of I

that right a is And who so doing tenants well mentioned are doing we right example of H&M slew now. one whole fantastic is now.

we're -- year. I that that bunch through comfortable of we've but this back very to the we bankruptcies we're some going a we're give mean offline, So you can the gotten more space backfill specifics

line next the Michael of with comes Your JPMorgan. Mueller from question

now live. are You

hi. Yeah,

announce Anseong it Green you years you Hills. many So next expansions how starts five you so? underway sizable finished do new or the or Curious have think call you over could development

to say emphasize we're important focused clearly to below that to and closer and here. the can't does are us can. lot. and debt what on Blackstone balance the It to down can we strengthen to ways Mike, in by on And the It's for will want a transaction we much clearly it's down about we turn Simon looking eights half we very helps a sheet. if say low, to gets seven difficult it's start. EBITDA opportunistically I get eight, low

That's Plaza. Nordstrom's and Green huge bringing check, Hills Club Anseong doing into Country After done, a we are we not is that. but are

meet developments Asia high how can right in that many We hard identify to it's how are really to rates still many can we we our execute now. and say very looking for hurdle as

or can centers. in tenants put accretive at get where other back we of looking we allocate We're terms two out places places In capital. looking where to ways we'll We our at store are department figure might really place. a

a some up or like experts will some it's cases capital adaptive of who boxes those, ends our of that that. think the put note there. whatever do we in some I different in In capital address to department ways -- it will be will are being things is on of that place there in are important use which store cases partners lot gyms to reuse end some in to going hotels, by office, side up

of to what very lot very that in a focus and hard the specific now say identify options going a can there's hurdle. terms any be we So have right we but if Asia would it's forward, of be those new for that development really starts,

in XX Were -- assets your well free. comments the an on Got the that you NAV the it. those enterprise as the actual on of intro in as using versus value? two debt buy the And assets for then it's more get two so assets analysis overall of

other of Yes. There allocating on there one is debt would pro case, -- In it. mortgage. rata portion a the we're unsecured basis a in case to

So the that be debt those appropriate be assets. two yes would that's for there after would the -- NAV

assets provide shot you And they could are the since any those it. unidentified? XXXX two combined then for NOI Got

I it's our what share, but that, NOI of say providing meaningfully that at meaningfully shot our portfolio is less. will half than in less No

Got it.

Okay, thank you.

over two We lot you get a those out. NOI if cut more left

it. Got

thanks. Okay,

Citi. have do We follow-up Christine with from a Instructions] McElroy [Operator question

live. now You're

It's Christy. to And was with you. little two NAV more spend think a to sort differential can just went Simon, of XXXX. wondering Bilerman Michael just relative thank November from I here Great unpacking you time XX it I you said assets this assets. if

those improved at of effectively of $X.X over guess either two in cap just assets from standpoint lower $XX, at million $X.X top or assets the me something of Now equity $XX worth have with that the it's math, XX billion. the shift been because and rates XX equity much is million else other those dramatically XX only which months or NAV happened eight surprises $XXX billion effectively I would of shares, have

can reconcile help two things? So you just those

XX we are there you When concepts. talked different Well, liabilities. going on to slightly assets would put take out all about November, said of rate the basically back we cap a it

then all would So the preferred as the is getting value all assets free. you have for debt, the and from all you're the NOI pure remaining

debt NOI price. equivalent take out and Today's NAV the them that saying those is cap today's assets the assets, two to of the out you two to related remains example take was share

you then So very have those in rate on with XX that they is the then you remain as extremely would the And on have what substantial those assets well. a put cap liabilities left interest assets remaining substantial. that with to NAV depending

for if just moment we NAV at lower or stock two than consensus lower is half at $XX is of than NAV consensus right a guess I what people consensus at half two assets worth worth assets so the And $XX but Right. you're that here think than and the company. minimum effectively if of is NAV XX% $XX, greater are the a are those look is is implying NAV company

when that I you indication seller say think you. said what others acquired with as Gardens agree Palm we we've Beach did least think right. is $XX as -- the when accepted of got the NAV of a I will I what just NAV. the recent we there when at

is or consensus, I you like -- think about at that. it $XX $XX something however, look $XX today's or

at I today. approximately saying there. cap the rates get assets are think determine NAV are on order assets, least But worth in we to But, right to for those these two the what yeah, are got trading they think price the those everybody yes

Alex and Gardens. respect that color the to you appreciate the benefits and terms going you about of in you of talked Palm public gave Beach I And provides private being as the the idea I that

through or just them. let about which from hey give I team narrow that you you the investors, to was you gap? transaction, cheap went are guess, than metrics did trying potential the thinking as other me you management how positive. Asia new current investors and board I this So all know a telling we’re and and what else

You try brought else do? Gardens, to you in going to are but Palm Beach what

at know, you've you of I Directors. I a driven activism, guess, where done just saying, at people And certain on. and X, -- but the at of -- forward? interest put sale further new thinking about go And the expect assets okay, sort current you're discussion recognize job remarkable is for is of I an should free, stock replenishing least Board your some the that Board? this I'm part, back that the to maybe by point? a are it in some of XX What company, you've lot want indication was, of buy split maybe in to as delever what investors

first it take I'll Bobby as then in Michael, to may well. and want jump

to previous portfolio, the continue thinking That's value what the cash that Board the we version of them. that We we ways on. Board, can engaged we engaged grow that can been with we're and but delever of in with well, ways flow. focused I'm ways as newer obviously create very can with have

basis to made good we continue on to time our we intrinsic to highlighted, still make closer about price of Board the have the value a regular share can we choices, things, decisions that to already own. think the with NAV right what places We we we're get think do that where that lot try over gap looking. should of It's and close as that we’ve a a conversation we

to for about capital for about an we And in sense will. We're that to opportunity we look it strategically way as we well. have there's think that us, opportunistic and if going asset, If at makes places us us we to the to we hurt doesn't sell that raise programmatic will. we're sell, a can way a and it be going sense that where, make

the in will front that, around don't Specifics of to decision want ultimately be any making. get Board I that

we're what think going can grow balance cash So like we're the huge portfolio to sheet -- and make better it doing, but I those flows, to and we a trying it, focal is make Gardens. don't did better the doing point about Palm we us can't really talk for Beach keep specifically with we

value the Obviously, with assumptions, the us view How investors. reaffirming $XX very NAV this in So about meant a that let reasonable NAV market, value of of consensus an we that. look that is add, the range Michael, that today's essence there is at said people was company. very There we lot We're to is inform can company. on me analysis in in consensus what believe today. being much that,

place the a Beach making is period a point at to by to a was that flexibility It we in in. to It joint decision. very with good decisions. recognize that center once be decision believe Blackstone good gave value certainly of decision wholesale. of some us strongly the retail, the good Blackstone built, is Anseong own in bringing allow in, make We through it think kind may project that good we not And else. the about a development was XX% Anseong decision. a in that venture partner will Palm find Garden a

our very going We're we're that Board. make the with thrilled Board with trying those with We're So have decisions. engaged keep today. we to to us

how meant to and the about and an thinking are importance. it's its again, we so, it's analysis, inform And show NAV

the you true your up lot So hadn't back, stock the to go are been those today. was it of today, appreciated higher very these were have getting would where sold different, transaction, scenarios, a been end the to back hindsight, Right. being where assets right? Starwood, some a on in even pricing have of market positive if rate probably to you assets, especially, those the if being time And looking at would for think ended cap right, though up relative you you trading, you two priced those I hadn't what-if assets

two think as splitting is So that to the that, there maybe, I doing portfolio, a like, sounds you makes is that you off is assets go, -- that to versus the or the about engineering asked selling sense? different venture hive Or trying relation joint is the parts question, asset asset of the it in XX in would more company Or there XX ways, today? probability? low very of the a portfolio route just financial

time at the with it. made we didn't were of that well First Starwood do all, like we criticized to transaction, that we say enough that I'd the

and And of so, view at market's would I at appreciate you be we find the were gap. time what very trying was to we and to complicated. that it We are the of But with the ways doing. the do of on idea having said sort skeptical we splitting this to that, bridge bringing meant look I look that analysis inform said, and right everything, at everything, was company, focused as up

and appreciate Right I all those comments.

time? cost, a When there to of did bit question. for you the a truce the part that pay and land have agreement of last with of was agreement a period of was buildings off to not Just non-disparagement little that sort

proxy saying at we're comfortable what said point, publicly the Michael. in this have We really and

So I don't think further to we're going than comment really that.

this it of bare public of the thing. all sort So market you settlements agreement? as us these things We're at a -- -- would type six least have break that doing together in year just let typically sort It's -- did just those just do months, part in of this you in usually we of put your Board. go months, one don't not typically nine as give

I said Michael. what to say, think, we we're going

the versus legal million $X of quarter, in this Is million? extra costs $XX the the that part

land buildings for the was costs. $XX total of their a quarter. That part of It to and was $X as million the payment reimbursing part them for million

million And relates $X what then? the to

different things, the the in situation Professional fees advisers, lot active proxy a contest of with threat one. but an particularly typical of with

terms this it's we slightly be probably last consistent $X frankly than will it year was earlier, million last year with years three out. is, said the pretty less before. or in taking what And the Michael the of as the spend And year,

That's $X.XX, unfortunately? $X.XX of NAV

others. impunity it encouraged battles of amount money with these huge a by is that occur that not and get sometimes It's

the all Have and thoughts I summer. rest the time. a Well, great appreciate of of

you, Michael. Thank

you. Thank

Jerome, are other questions? there

I'm time, any this not further showing At questions.

closing continue for remarks. may any You

Thank forward get Center at you when you look to Thank you very and look We all. LA you Beverly much to fall. everyone. seeing out Bye-bye. the in go

the joining a call. earnings Centers' you Have for quarter Taubman Thank great second conference day.

disconnect. may now You