First Industrial Realty Trust (FR) 21 Jul 222022 Q2 Earnings call transcript

Good day, and welcome to the First Industrial Second Quarter Results Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Art Harmon, VP of Investor Relations and Marketing. Please go ahead.

Thank you, Samara. to welcome and everyone, our call. Hello,

discuss updated guidance we our second our and results XXXX for quarter Before the year.

Let federal statements differ our our as XXXX. provide. described expectations, statements other sensitive me call assume may be cause statements of of to today's and from estimates may or Actual include that other XX, no remind could our We filings. July time forward-looking SEC statements plans prospects. and defined update securities date, based are by in forward-looking These laws. on management's accurate may as everyone we Today's the statements information results which and and materially our obligation our factors XX-K are only this

a today's under of tab. discussed earnings and reconciliation supplemental report release measures financial are call firstindustrial.com the filing earnings SEC our available find release. supplemental in our non-GAAP at and Investors You The report, in can our

Vice the President Peter Walter, for your of Our call call Officer; Jojo Investment Senior up Chief we'll Peter Operations; it Executive will on our Chief open our Scott after begin Executive by which Financial questions. with Baccile, and Musil, Officer; and and today Vice remarks Also of Schneider, Chris and Yap, Schultz, Bob Capital President Senior President; Management. Vice Officer; Markets are President Asset Chief

Peter. to Now over turn let call the me

Art, all today. you for thank Thank and us you, joining

square EA Scott successes Net line several vacancy FFO X.X%, Phoenix leasing continues our XX square in included absorption market Our guidance, a increase completions Joint million to culminated which shortly. new feet. in have and CBRE large reported quarter second national low. share team industrial at new XX feet, which U.S. an land per was discuss million of delivered all-time great another in which Venture, significant with exhibit strong the The fundamentals. sale our quarter, will in

measured but are the with our Lehigh And especially submarkets, supply-constrained XX% quarter We tenant In levels where backfilled been last an in construction the focused. only of at we expiration, we key earnings our captured finished Valley, in meet generally coastal, rate a few has increasing of we largest rental to XXXX square are where XX.X%. that occupancy demand, a a New the portfolio, since XXX,XXX rate footer increase downtime. a signed call, remaining days cash few with our rollovers. we

new taken continued rental on our Currently, we overall to XX% our rollovers. is strong new change and XX%. overall XXXX renewal yesterday, increases our also We rate cash leasing. care rental and had achieve Through rate on of renewal of leasing

this to expect for higher For our expectations is the change rates X note be at full that last year, also points the we up to gap the XX% midpoint XX%, rental I'll now than cash quarter. XX%. percentage population

already care largest we've XXXX, X taken of our at lease expirations. Looking

first and The of Kenosha increase months run the in is expiration cash in XX%. building a of of submarket X rate a this renewed Chicago. advance foot lease XXX,XXX square We

rate change square second located XX%. a we rental of that at foot The Minneapolis tenant inked XXX,XXX cash is in a

on the As in markets XXXX the largest United in XXX,XXX first Empire, our The feet the market. Inland of States. square located of strongest is well today, in in-place the one is property which expiration for rent is below quarter this

since soon, be Central the successes The square in XXX completed like at First X.X leased I building would to footer on to in to a an our our We last development. is million taking and occupancy call. tenant will highlight e-commerce September. Moving few major Pennsylvania retailer. Park

achieved October. exceeded commencement XX%. underwriting with The rates our in leased footer also upon rental by XXX,XXX square in We initial Jersey our New completion approximately

phase of First signed first XX% leased. XXX,XXX square at lease project foot Park bringing We the another Miami, to also that

starts. development new to on Moving

the to started square spoke X in addition more buildings. about call, Inland last facility XX,XXX we that Empire on the foot our we In

First Central building is sister square Park XXX foot in Our Pennsylvania. XXX,XXX the largest at

Miami, Our expand will investment investment with is X.X%. estimated new our square $XX X.X%. with there of yield investment $XX a building XX,XXX million and Park At projected foot yield a we of projected an with of estimated million First

foot in few handful the million buildings million California, and an an for land of land that $XX X.X continue upward of future land cash expected a feet quarter, the acquisition represents investments and million we Inland XX,XXX feet and quarter. overall development assumed costs square last million, additional of today which Thus the X Northern Southern an a project XX book of market million. construction be for are with investment, growth second sites, a investment average South also of Seattle. with quarter compared to Including Overall, in process positioned of today's billion an adjustment the based $X.X of targeted Lastly, markets, far feet. the leased investment front quarter, comprised a plus represents to support in started these X.X%, well XX,XXX our Empire Infill California, basis. yield buildings third Florida accommodate were a coastal starts, $XX in with of corridor the developments in This were of The margin which We on can total margin XX estimated XX%. small and cap approximately busy square square basis balance in the site of new XXX yesterday. on acquired X.X%. development million investing yield on Miami potential approximately in at total This a California estimated of a is rate Southern in square all projected reflects calculation during and these points an totaled $XX of $XXX including XX% we as Northern sheet to our and we

$XXX center sale the to XXX million. We data completed active Lastly, with successfully acres of Joint XXX in of we've a Venture been proceeds for our Camelback Phoenix. user

promote the $XXX million. tax before approximately was and Our share gain of

the JV features I'll which hearty land, desirable of the to XXX totaled with and frontage. a just team share that, of $XX continue turn entire owns acres successes, First Industrial shareholder with all Our long-term all thank and date work highway still value. many for of And drive million, contributions venture you over to you to as of your it to I'll hard significant conclude Scott.

Peter. Thanks,

fully recap our XQ to Let share per the share from funds XXXX. compared per operations $X.XX me in results quarter. NAREIT for were $X.XX diluted

quarter, X.X%, in slightly our primarily lower renewal free and and rates NOI bumps was same-store cash growth occupancy, on in rental rate for leases, rent. embedded increases new termination Our rental excluding the average by higher fees, driven leasing,

during for quarter, noted, was the As of basis approximately were were renewals, feet to occupancy in-service million X.X million commenced. square square XXX Tenant Peter our these, quarter retention X.X the points million we X.X compared Summarizing finished acquisitions Of XXX,XXX new, and lease-up. with with up of developments XXXX. leases XX.X%. leasing activity were footage and XQ XX.X%, by

to side. on capital Moving the

our loan. to off term As call, April a with million earnings a $XX X.XX% we used on mortgage years. $XXX we loan of were our $XXX on closed a primarily and million term Proceeds X.X refinance pay last announced tenure million, loan in

the of loan unencumbered. of The of term credit end interest XX.X% second XX interest this from to quarter, the at points, our effective As into swaps XX of The the the million entered basis rate once existing on we portfolio loan the spread of rate in a SOFR, an basis is interest has In is SOFR new of points. new second rate entire effectively plus quarter, swaps loan expire. year, rate plus prior our adjustment a fix X.XX%. $XXX fixed the October term

on earnings last evening. to XXXX per guidance Moving release updated our our

to midpoint $X.XX XX.X $X.XX, our of growth an before the fourth a $X.XX building earlier which on the interest lease-up in NOI in earnings share will $X.XX portfolio, foot is Our occur basis capitalized Baltimore the in an Post assumes our XX.XX%; basis-point development share our the anticipated includes of is at in XXX,XXX for call. X.XX%, June announced midpoint. the guidance lease-up square basis in-service assumptions completed developments, in increase quarter occupancy prior the guidance increase The a fees follows: quarter. primarily and Same-store as This our to X.XX% Guidance guidance FFO service in XX% prior of compared our and end cash to newly developments of costs range of is to to starts. to an with and NAREIT XX are at midpoint points Old for related per compared of Key due per increase termination at now the XXXX call. to XX. earnings construction Road to due increase under our increase

discussed, interest, of reflect at of midpoint. we For to than other and million, guidance previously million the guidance impact the excludes is year guidance to our last G&A $X.XX than And $XX XXXX, does the the acquisitions $X.XX future future starts, share our new quarter. expect range or or increase an equity. debt impact about repayments, potential higher capitalize of any development debt sales, of also of $XXX,XXX not now per repurchases issuances, $XX the any Other issuance full

to over it turn me Peter. Let back

Scott. Thanks,

markets under We continue activity plan. to seeing construction. our focus are good executing and strong, The leasing properties at on development our we're prospect

serve additional land our we holdings. positioned through I In to earlier, sheet as addition, mentioned are well customer on-balance demand

will we prudent to that, move of As proper growth. continue for remain and with allocating Operator, risk in open capital profitable emphasize in markets, it up in questions. unsettled forward management capital the pursuit we these please

question. we'll [Operator take our Instructions]. And first

McGinniss Greg is This Scotiabank. at

Just two me. for quick questions

margins falling the point XX First XXX%. to cap Is that one from assumed XX% rate? development on increase is basis in just

change in Yes. the That's calculation.

honest lot XX margins, We While the of to markets points. felt on are the was trades. points, of prudent and average it to like estimations few data across conservative about a there bump our be in very there cap intellectually aren't rate basis our

calculation, that of And point like that factored completion basis upon X-year or something? that is the line XX when Or time a into the development? is is

assets rates for of where our That's have estimate of markets these cash we each new the in flowing cap developments.

disposition, was what have? And expectation still kind of land of with the look to the for the always you Okay. plan disposition, the for rest that And the then then land, it? with another JV on the that user was is

which sales do that plan now has PV-XXX, build-to-suits, do Camelback executed the So development. to same to is plans for and users, always our to same go the ahead in to been was identify have as speculative potential our we and

the the very, on the acres. of pleased all XXX with above, very So we're execution sale of that and

So is this opportunity pass just too good yourself? up developing to instead of of an

at really always portion the intended users, sell entire of develop some other to intended to never ourselves. to a We least site. site We the

our And question. next we'll take

just it Pete, lower? mean, the exit from that I to any I you guess, can rents Mike on assumed these you're development RBC. calculation? Carroll did describe, any guess, changes the of you adjust is or that Was higher I the you cap? going receive This did margin properties, other to

you do cover to want that? Jojo,

of things. on sure. was a our based primary the The Sure, primary developments. our terms the costs. There Mike, change forma change very couple forma developments, driver. in That pro pro exit construction on on was cap little was

the than from quarter, X%. fact, very NOI, in was And quarter there have pool rents slight less this same In reflected from margin. but offset -- is because last the to total what's increase slight increased, in the a

again in exit the the cap. So change primary driver was

near-term completions? on vacant. completed that I I are the narrow are you the prepared there's developments of process what's mean on I mean in Okay. buildings are that the activity down strong. still the know specific the be guys expected about third progress in know the pretty those assets? you that remarks quarter X can that leasing to that kind -- Great. highlighted in-process to I

Peter it's Schultz. Mike,

X we X, first full in So activity of the Nashville, decent users. is building see where to a the from continue

activity building That quarter. is is an third interest we're we building the near what those is buildings full in and buildings will completion, partial be in from The other see which done users. one market, Both typically both in seeing the now, uptick Denver. as of

up. the rents So good about we have limited to to go choices very Jojo? tenants continue feel and as continue that continue to

Yes.

that inquiries well. building full half And both out, the proposals this For year we scheduled but of be first users, building building third in in deal, have have is yet. for to as multiple is lease which no quarter Seattle, to and completed and we report

update Okay. there? an just me. Post I you last what's Old on Great. the Road? then guess, us And for update give Can

Sure, Mike. It's Peter again. Schultz

my go consistent with full Similar earlier to choices discussions date comments, several lease the with comments in building all quarter, continue trading with have trading as guidance. to our lease So well. that in market rents The to we're prospects. they're users. that X up is comments limited fourth We're we're in tenants anticipated X, the and with commencement continue

our next question. take We'll

from Ki Bin Truist is Kim This Securities.

changes go Can quarters maybe have noticed, back What for or may to interest of today space? ago? in wanted to talk of new versus activity topics. those any Just you any, you about tenant it like a some terms if couple of looks leasing

Ki Bin. Bin. Schultz, Ki Yes, Peter it's

So activity on the new country, to across continues our across be sizes particularly solid, space buildings.

As and Pennsylvania, developments New remarks, in those pro well ahead we Jersey both you our of forma. heard of in completion, leased ahead of

want largest of we Our slowdown with add? It that rollover no the across months broad-based backfilled activity Lehigh of continues to Jojo, and we're anything and demand. to been measured you terms over consistent across be there's seeing in last the in in any the industry Valley, downtime with several level that's days, country. types

we've Yes. That's rent achieved. that reflective growth of our

of properties that but are actually one time, good that located, every we the multiple same of continue growth reasons on at our to we prospects achieve So space well the we have each is have. rent

so the And just that of strength market. the shows

And or has X X? that, maybe if year, last there you see to were on is down any Or with for X does that just X mean, to or prospects stick multiple prospects, given example, still X when prospects, X space? that ticked to

It's pretty the much same.

year. market same half you and last much if the year at look half or this first reports of the is of QX first same as the activity, fact, year QX the is In much the pretty pretty as on last QX

question. we'll next take our And

lot It's and discovery Rodgers good going for like seems the I understand cap, activity. wanted capital a hope a and dispositions maybe Baird. you're the well. all that's on to the plans actually do on year, fundraising sheet second opportunities? to both more I balance half of at Dave investments exit going market, of And terms itself? ask I if are and conservative raising, that? there's price new and presents It call. to the those you are ready seeing But get in of have flip aggressive executing side, with do on the in out you you opportunity the the obviously And

our $XXX are will to be a remains we It million at loaded, with guidance So respect price sales, in $XXX million. back-end period definitely to discovery. yes, of and

a few as market We offerings. see begin goes that will how we to the enter with

of but in are to pretty Our good feel we'll that price see. we expectations so continue discovery, are will some offers, we again, this period

markets on really business. hasn't -- really In Again, I between aggressive X or a kind think of or ground post The more terms being it's aggressive less or big and capital from in the the a on is what's business aggressive developments in changed lot. of new a don't and into early. the months opportunities, our disconnect happening has There stance month our news what's happening We're Amazon. changed. X whole

far, factored. so really not has And that

today But we're -- terms see our we'll to Dave. was in year. So stance different risk, than of it taking at as beginning prudent not going the is the we of remain go any

maybe, on follow-up construction. a then Jojo, And the Great.

changing? And mentioned level sequentially. mean, planned you But projection in given in terms can no some of hit, shortages brokerage Last construction are component But current of start this builds those real to terms seemed you supply of think talk construction? some the constraints really in start to of state environment? the components components. there that's houses. steel big about the under how there be the to see costs and from big some the finally the we supply I of numbers in can I there's and construction for out year, increase

Sure, closely. been very Good following that And we've question. sure.

for development, too. know, we're you in market As the

now, affect to tell back components I down Right -- of XX One can they lot -- they're you about that delivery I a little a in terms months. is months the bit bit. When period. were X in XX to advance. months little XX pulling came a thing, XX say about at steel back of So X pulled to

for conversely, increased. is But material some good that offset it us. components that was So actually by

is example, units, in a they've to In dot For rooftop some and some extended markets and cases, they levelers year. about actually industry switchgear HVAC, transformers, our have called or RTUs and extended.

lost offset that other of we delivery, whatever kind So of steel we it materials. on got the in

to prices the Industrial, talk going First that's do And just contractors, commitments. to industry. whole affect actively So we we our

In of terms our and development, do purchase own forward it's we as we with we can. commitments, just appropriate, work if as municipalities hard the

deliveries. changed. manage we our not that's deliveries have So how construction But

you the there. gave So I components

of whatever but quite in increased bit, lot releasing think development it's to of be Whatever deliveries terms on is of be a out to it's bit there, whole think market, have In the those. delayed. going -- also I announced or construction little whoever bit. whole in going little delayed there's construction, announced under a a today, the going we And a I

significant experiencing delays. are some And

All going right. Baccile, you. That's Peter sorry. helpful. Last one for back me, to

X leases what macro already a done where You made Do and some of inked takes you're comments you kind for you? of 'XX. have percentage you about number a that with 'XX had big

will that you. Chris cover for

Yes.

look stand, right we've increase at XX%. we a now, of XXXX, and of that's care we the about taken XX% cash at leases, So of rental

we'll And next Instructions]. [Operator our take question.

Markets. Capital KeyBanc Thomas, Todd It's

a there exercise as to you can I increase basis you that blended geographies, sounded the And on in follow markets across up exit just cap in average. development cap XX of went First, any differences the rates I'm again like discuss the rates pipeline. curious point were wanted It raising that just pipeline? whether was if through across or

probably is around XX highest basis a markets, right XX. averaging in coastal to the that's points, it's XX. XX than closer clearly the or to average, blended X it the range Yes, markets, is -- barrier But XX

seeing at that decision assets all sounds just more pricing? Can any you that like trends you comment seeing change for a today? maybe in And bit now. on right was just it a little market Okay. Are broadly price prudent then you're

Jojo, going thoughts on? give do you on what's your want to

that will to Yes, cap decline There ago, rates are very far of is tell trades of cap were it yes. in to is very market that right change. Sure. much quarters current pinpoint so difficult you for actually not couple I closed it's -- difference have in weeks, -- like a closing last much quarter now. so like the at X trades in the rates so there's it What where transactions

there's So about or have happened. a their in from the the lot hasn't been times, Sellers of lot changed marketplace, a it of talk not retrades deals. walk expectations

talk So market, too. there's the of lot a lot a but of surveyed there's huge we not that, retrades going when of on

right cap So visibility felt to rate. prudent. the again, what Peter lack was was it not thought to it of change now. back says, We imprudent We

So we're cap are was prudent those not adjust saying it more We right be rates. conservative. just thought the it to that to

The tremendous. rent remains opportunity growth

a And while. some that call so over rent of better price haircut the think taking first are and you're don't off the the keeping you it, this of I last a far relative may than growth quarter. period asset pricing at discovery the to, point, time, enjoying

some take for time could this this So to shake out.

to helpful. minimal as acquisitions had decreased the in That's you starts Should Okay. expect see sort bank quarter. land of of quarter it picked and the up then side just further? Or acquisition pricing land you're development decrease the terms as the land mostly you maybe was on And well? talk a the little land land we in timing? seeing bit about in And can what bank and

-- our in opportunities. active land across new looking teams remain country the for We remain

So that changed. really hasn't

higher. are our little Our we've everybody return told return bit expectations -- a

the X now. sheet supply call years mentioned, in We of it, have, as to we right balance X

of of the your was last So all kind remained same. the of What that question? part has

for acquisitions around guess, appetite land appetite. Just I so your hasn't Well, changed. the

land guess, pricing price and Just I trends. for

Yes.

prices. the happen rates happened higher for well as well-located think, it are up continue as I to up that days. valuable, often land, again, those values doesn't continue these to be entitled, rental But those support to to go to especially land most if go going which --

take our question. And we'll next

retailer you Powell a was foot Anthony seeing space see just demand the to do seek X.X in all comment any quarters million change on environment? few to the uncertain from behavior Or pretty the the positive, About tenants tenants headlines. given ago? as continue were in from Are they e-commerce you out of this leased Barclays. continue square

the the space. Schultz. Peter it's first moving I say continue Anthony, we're if as seeing Most is of about of -- to it Nobody Yes, not of half the first be all, growth the square net same another. one would to it's building foot year. half and from requirements, that XXX,XXX throughout was additions

be particularly they find commented solid for we we're the a as where around the the most and choices, earlier, have spaces, a of barrier demand, markets to we've continues times couple are said, few really country. in to very because Tenants building. So hurry part, in higher as

feel So bullish the we the side demand continue business for of to sure. pretty about

seeing of Amazon, you on activity sublease that terms the or Maybe an on in in update us anything give Amazon you're portfolio have you could currently? anything that like renewal activity or

spaces. We don't in below Amazon conversations -- having rents our with are we have aren't them, any with have spaces we do the the In market. any

welcome to but they very we be So some with our might conversations, happy spaces. seem

which market of in they're to they're very trying have spaces for that us that market, was the need they term the just few space terms ground. one and nature, believe maybe bigger the sublease. the be on would short what's that short that enough believe to Yes, than happening term. manage going soon to put they're in they Interesting much costs the headline to a In on again, broader all

that, I a I you. lot know don't of you... Peter, if data don't have for or than Jojo other So

our during time. of seen incremental It's in Peter. a is spaces this I'd other make The only thing add we've investments to couple

commitment. Amazon think reinforcing a their Jojo? overblown. this discussion the whole little is that We So

And the these in within Amazon a subleases of we're the happened of a the there markets scurry really this our That's in It If got investments. was haven't leased. focusing that the terms in even not by And markets strong Coast tell markets of parts leased we you in some West is can are. of submarket. on long. market X basically, And months how months. on, were it West, activity, particular any, and got subleasing we seen of focus within couple It that a a there announcing. was I

next question. our take we'll And

color This the industrial markets sheet, with big it I some Street. in debt to overall is provide is secured Vince for today? this market. part on Tibone transaction Green of important balance understand Could but your you is the a health the of

So views I there. to your wanted get

would the really and leverage. is Walter. for life I probably haven't the CMBS secured This now executions challenged, Bob seen I say lower up. still open debt in market markets that are company-type but market there very pretty at rates The and mid-Xs, are albeit open the back is right

So the the how on is year? be wide to might Or CMBS? on pricing deals pricing even that no this to point in earlier what is

a going data hasn't wider the is to Again, activity point been very it market, financing company life to You're of to. be because than just. they're point exactly lot challenging where that is,

talking they life in So using are what that How are financing most purchase? sometimes the run relationships? doing the buyers in massive that? into. not their you'll local I'm are bank codes, of the institutions more their about players Like local

those buyers are company just say, financing. I Well, transactions the that would activity, deal a getting would those lot their of local more market of where a seen life more seen bank regional have I haven't of hit, and you again, but say lot and is you

And question. we'll next take our

Mueller. about Sorry Mike that.

-- I it it? for been remaining, and to things Is was think Most XXX opportunistically quick keep plan Just acres develop over that Camelback answered. for other on But or in the sell time question. there it XXX, the JV. game at the have

frontage. Right the changed. freeway plan XXX have The Sure. hasn't acres now,

which's XXX. sites and And XXX, on All one-off, location. a amalgamation frontage, so the great if it's juncture of of the closest, the not sites XX of have to great, freeway closest

-- the and is involve to sales strategic the So really pursuits, those value higher and strategy creation that venture, mean a involve users best joint buildings a that example. use could that could user, for could also speculative still to same, for and

Mike. to facets value all but So could announce new be used of creation yet, there, nothing

Got to the are And it. expected Scott, the after-tax sale? what proceeds on be then,

it's me let quick, -- the Mike, about think going to be income taxes, haircut sales I off million, look supplemental about proceeds. real taxes $XX the are those at

question. take And next we'll our

something Rob Stevenson source or of variable term Scott, capital if it's debt other Janney. rate It's price of is is of incremental loan today? that net or debt? where where best a your And swaps

I at we're think continues tighter. to A still getting look April bank like from of Rob. to holding. bit companies market the this What the access of we a banks, little are be trying active. it market, year. best other in did It's to It's are lot hearing our spreads

So would at points XX a basis rating. be for us, that flat BBB

one our days what of we attractive got e-mail market ago, look at an capital. So to of couple I'd swap is -- from think the that's have the on site. Last I I a think debt X market point probably X.XX you X.XX capital. that you swapped at it time. of in to But to source years, think best continues be the bank if banks. I And were the

that stock that? how you high if give development Scott, are the or XXs, room still price? million JV-ing pullback on the be else, you It's you How financing think thinking guys in spend about dispositions, we Okay. the $XXX to And million there? XX $XXX you of enough the the don't should Do thinking pricing given something? about something then, does doing like about

Yes.

be care really of this with I We $XXX joint came of We in million that $XXX sales flow to our dividend. our development going on of have rest of spend think a taken we market. sale. the still Rob. CapEx We've of after That's from shape, and good got year. venture cash have lot for over hit that million in little the excess about the balance sheet. A cash can we're

if wanted loan still can we before, is And X bank term we to guidance XXX. mentioned as Our well. raise to the capital, other look I to as again, market

I think that would be our plan.

we'll And question. next our take

Ki Truist. is This again from Bin

underwriting on just broad you the looks philosophy what if share a pocket of quick weakness your should worsen, some lay was that in kind wondering your portfolio? underwriting thoughts the could where of philosophy. Just picture can macro And I question like? on

we In have increase underwriting, terms of our out return going requirements. that word we're put the to

always our have conservative We've requirements. increased been in We pretty Ki Bin. return our underwriting,

We going have in in. rate always the had from a residual cap step-up the

been we when that. do to Sometimes people concerned... lose opportunities, pretty who We've don't we lose

cut underwriting, credit, tenant I to sorry. tenant Sorry you. meant

on Tenant we've credit. always been focused very Yes, credit. very, tenant

We very of have quality who taking And is That we that our strong. changed. tenant in-house new analyzes an tenant portfolio hasn't every on. team, the consider

when guess, XXXX In been fact, X,XXX still a in one it the had and XXXX. of when agreements. it we just only XX in XXXX if our of factoid we I you tenants, deferral XXX% tested, was roughly want more would out had in rents look COVID And our we time at collected have lockdowns to

is job. tenant of great and your us, So important was credit team I does our What think question? the part to a last

if Just if Would macro picture the or? any? where should worsen, of that the be, pockets weakness could retailers be

higher the by. bigger Yes. these We say portfolio risk will is very where Clearly, we come side Bin. spent through one that demand pockets question. of to building we to the so would a market, of so last supply overall think land be, the reconfiguring is and barrier in Ki have one where cycle. it's well now do and a markets that in terms dozen the difficult our on the good Yes, side years Hard weakness

question. take we'll And next our

me? SMBC. Anderson you Can hear Rich here,

Yes.

Okay.

an growth ran assumption Do -- broad you absorption, some periods? of basis have a specifically question, completion. on past stats first changed assumption and a through national rent national have you vacancy, might from it how market So

market investments XX% go are the increased range, markets well, to whole year-to-date, to our X%, are when mean, for we are a more I Yes, like of the that look broadly, usually in rents and portfolio. say, course, have the Yes. That's how how would submarket. significantly but manage sub-XX% X%, XX% X%, that. And we it's there than into where our broad basically I we you're at But to market in there markets market U.S., execute, range.

been -- about industrial coastal XX% than significantly been are has overall. that But So mean, It's whole are markets year-to-date, markets market XX%. I strong. the more

discernible pretty you're unchanged mentioned news, Okay. today? what as far really the everything you is much And seeing no change, as Amazon since

Yes, you're correct.

my then Okay. And on question is specifically. Amazon second

the distribution that million Amazon Amazon. of But number the of be, we will and know of million square a feet comparison would that the square we're the XXXX, really to yes, I whatever XX is number of saying X. basis have amount I should against added, XXX don't be talking feet You XX that ultimately space argue million static giveback, about not that comparing

relates million and planning to reduction, million feet but growth the a not it feet it's So your of square your of as square reduction XX vision the XXX business.

and how curious the you to have given last years to growth point? from all a and that, decline think of year? any to this couple and a Or thought relative were kind ago perspective seeing X, but you of that. at of to what at them I'm about not relative others we So years big past couple the And them of growth impacting a underwriting from if relative your is

took million between they XXXX, most to In and the XX million tenants feet, active square combined. than more XX next equated that XX Sure.

their in that the The their improve reestablish of grow and working has footprints were took that player group rest hardly to space they and time So any competitive been positions. XXXX. over

retail in And and the additional they leasing, so gained general providers, share, and share is any taken third-party leasing taking up construction. has leasing. Bev area up for market who building in way wholesale, XXXX. terms are next, Nobody in which and big. up are that materials space by Manufacturing up in is was and in way is of Food logistics in space example, being their that

they was Amazon that in nobody flag that's up. and and most really active are, while now So was, picking XXXX, else the

-- eats the gap takes that point of you rightly out. that that care So

at look demand the currently as growth we forward, broad-based that's why requirements in industry Going higher-barrier it a exceed and what hasn't slowed. the the can rent very very, deliver, markets tenant where

accelerated. In fact, it's

Okay.

move. the should be So not Amazon it not broader to be industry to news, just a should the broaden extrapolated point,

opposite. it's fact, In the

sapping giveback the it? saying they're that up Is about the is You're providing. way to Amazon think that

the up is well. X Amazon say, year, next taking continue you as they're that, to More And XX to Amazon I up XX And mean, that than that giveback. lastly, year, much right? going taking took who's as they're So the in taken doesn't so faster have eventually. sense have taken and to lot ever. to sales a it growing growth make your long grow. It's their And that been they Every surprising company little rationalize bit your a to forever of begin does space space. than

So clearly, and space through we take period, once this they'll continue get that Amazon more continue up will over grow, to time. to

to session. additional for Peter closing At I time, the or conference back that And remarks. will this any Baccile today's turn question-and-answer concludes

well. to participating person Well, call months, the forward our of thanks in connecting today. many in you for be with operator, thank We look everyone to coming you, and on

This concludes for today's call. participation. Thank you your

may disconnect. You now