Q3 2023 Choice Properties Real Estate Investment Trust Earnings Call
Good morning, and welcome to the choice properties Real estate investment Trust third quarter 2023 earnings Conference call today's call is being recorded.
After the Speakers' remarks, there'll be a question and answer session.
I would now like to hand, the conference over to your first speaker today, Aaron Johnson Vice President of Finance. Please go ahead.
Thank you good morning, welcome to choice properties Q3, 2023 conference calls I'm sure.
And here this morning by real Diamond, President and Chief Executive Officer, Mario by our Sato, Chief Financial Officer, and an erratic Chief operating officer, Graeme will start the call today by providing a brief recap of our third quarter performance.
Kind of update our transaction and development activity in the corner.
And I will discuss our operational results followed by Mario who will conclude the call with a review of our financial results before we open the lines for Q&A.
Before we begin today's call I would like to remind you that by discussing our financial and operating performance and are responding to your questions. We may make forward looking statements, including statements regarding choice properties, Jack and strategies to achieve those objectives as well as statements with respect to management's beliefs plans estimates intentions outlet.
And similar statements concerning anticipated future events or circumstances performance foreign sections that are not historical facts. These statements are based on our current estimates and assumptions and are subject to risks and uncertainties that could cause actual results to differ materially from conclusions in these forward looking statements.
Additional information on the material events that can impact our financial results and estimates on the assumptions that were made in applying in making these statements can be found in our recently filed Q3 2023 financial statements and MD&A, which are available on our website and on SEDAR and with that I'll turn the call over to Ralph.
Thank you Darrin Hello, Brian Thank you for being here today.
I'm happy to report that performance in the third quarter was strong.
<unk> to deliver stable and consistent cash flow was reflected in our results as we remained near full occupancy we delivered strong same asset cash NOI growth and year over year <unk> growth.
Core business backed by a strong balance sheet is generating stable cash flows. This stability is a testament to the quality of our retail properties, which are anchored by grocery stores and cater to essential needs as well as strong demand for our well located generic industrial assets.
Despite the economic uncertainty and ongoing market volatility business fundamentals across our three strategic asset classes remains exceptionally strong.
S based retail tenants remain resilient with robust leasing Tibet, many retailers are actively seeking to expand their presence.
Presence, especially in non urban markets in industrial we're experiencing robust tenant demand and significant increases in rents upon lease renewals.
This will drive.
Should cash flow credits.
These leases rollout of that.
And our mixed use and residential portfolio. The lack of supply continues to support rental rate growth in our residential assets.
As we address the impact of higher interest rates on our business, our disciplined approach to financial management and industry, leading balance sheet continued to be exceptionally valuable. This is reflected through the quality of our credit we demonstrated once again.
In the quarter ability to mitigate interest rate risk and maintain a balanced tenure that at attractive all in rates.
Okay.
Although devaluations also reflect a conservative financial approach.
We've always had a policy of evaluating the impact of macroeconomic conditions on our values.
And we were deliberate and thoughtful in adjusting our portfolio cap rates in response to the higher rate environment that began in the second quarter of 2022, we are confident in our current valuation and the current elevated rate environment, we consistently trade at a narrow discount to <unk> as compared to <unk>.
Here's trade to theirs and beyond that we have a compelling growth story and a tremendous opportunity to drive higher net income property portfolio and our development pipeline.
Rising interest rates have impacted the transactions market, which continues to be challenging. Despite this our team continues to demonstrate their ability to execute on our capital recycling program, finding the rot private buyers to execute on deals at reasonable pricing.
We remain focused on having a balanced program and on track to find our 2023 acquisitions with dispositions.
<unk> III dispositions have been focused on completing our exit from office.
Asset class and continuing to dispose of other assets that are considered non strategic to our portfolio acquisitions, primarily relate to high quality assets from loblaw.
We had minimal transaction activity in the quarter, we completed two smaller transactions, including acquisition of a retail property with a sharp best direct model and a lot Mark and Hamilton subsequent to the quarter, we completed $93 million up dispositions, including one retail asset two industrial assets and one office property.
The retail as it was at 360000 square foot secondary market power center with a Standalone Loblaw superstore, located and Moncton, New Brunswick. This asset sold for $61 6 million and included $10 million BTB at an interest rate of six 5% maturing one year post closing.
The two industrial properties located in Dartmouth, Nova Scotia, which sold for $11 6 million consistent with our retail portfolio. We continually review our industrial portfolio and determined that these assets did not align with our strategy of holding high quality generic properties in key markets.
Finally, we completed the disposition of our last office asset in Calgary, Alberta for $20 million. This transaction marks a successful exit from offices in Africa.
This is a significant milestone for our team as it was completed in a very challenging transaction environment for office assets.
Turning to our developments, we completed three commercial projects in the quarter to retail it densification and an approximately 300000 square foot industrial development in Edmonton.
This industrial transfer represents the final phase of a six building projects at Horizon business Park.
Subsequent to the quarter. We also achieved several other significant development milestones at a residential project in Ottawa, Ontario.
Which is named element partial occupancy permits have been issued with initial occupancy commencing on October 15th the remaining occupancy permits anticipated before the end of the year and the building is currently 40% leased.
And residential project in brands in Ontario, condo owners began taking possession in October we anticipate a two thirds of condo purchases will take possession in the fourth quarter with the remainder in the first quarter of 2020 full for the rental portion of the project. The schedule has been delayed sloppy with initial occupancy expected in the first quarter of 2020.
<unk>.
We transferred 353000 square foot industrial building in Surrey, BC to income producing with a tenant taking occupancy I know they have been affect the yield on this development was approximately 10, 5% a significant premium to a high quality industrial would trade in the greater Vancouver market.
A choice Calvin business talk we signed a lease for an additional 625000 square feet with a leading logistics provider. The building has been designed to be carbon zero ready and will be a generic 40 foot clear height distribution facility that is functional for a wide range of use is construction is expected is expected to commence when sites.
Servicing is complete near the end of 2024.
We continue to drive cash flow and NAV growth thrown development program, while our development team continues to work on zoning entitlements for future residential projects given the current environment. We are prioritizing capital allocation to our commercial development project as they continue to provide attractive returns even in the current environment with that I'd like to.
I hand, it over to Anna to provide more color on our operational results.
Thank you Ralph and good morning, everyone.
Our portfolio continues to perform exceptionally well.
Activity is strong and our tenants continue to demonstrate their resilience.
Demand for space has never been stronger.
<unk> population, coupled with a reinvigorated appetite for in person shopping continue to drive rental rate growth and strong occupancy for our necessity based retail assets.
The industrial sector continues to outperform all other asset classes.
Both supply and consistent demand continues to be a tailwind for rental rate growth, particularly in major markets, where approximately 85% of our portfolio is located.
We are also seeing a similar trend in our mixed use and residential assets with higher occupancy and leasing spreads compared to last quarter.
Our portfolio remains at near full occupancy at 97, 7% up 30 basis points compared to last quarter with strong rental rate growth across our three strategic asset classes.
During the quarter, we had approximately $4 1 million square feet of leases expire.
Tenant retention of 98% renewing four 1 million square feet at an average spread of seven 5%.
And we completed 259000 square feet of new leasing that commenced in the quarter.
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Hello.
<unk> will begin again and I apologize to those who.
Couldn't hear our remarks earlier, who are on the webcast. We will work to ensure that the transcript is available as soon as possible and I will just continue from where I left off thank you.
We experienced positive absorption of 173000 square feet, which was driven by two industrial leases that I will speak to shortly.
In our approximately 44 million square foot necessity based retail portfolio occupancy remained unchanged at 97.7%.
We completed 3.7 million square feet of retail renewals in the quarter, resulting in tenant retention of 98, 5%.
Long term renewals were completed at branch, 7.3% above expiring.
3.1 million square feet of lease renewals wherewith loblaw banners completed at an average rent of 6.8% above the expiring rent excluding loblaw. Our other renewals were completed at branch, 10.1% above express expiry with strong rental rate growth.
Seen across all property types.
In the quarter, we also completed 59000 square feet of newly phone.
In addition to our leasing activity in the quarter, we generated $6.2 million in lease surrender revenue.
We continue to work to accommodate retailers growth plans by relocating and right sizing existing tenants at our centers, enabling us to increase rents drive asset value as well as enhance the tenant mix at our centers with minimal downtime on our space.
The lease surrender income earned is an example of this work.
In the third quarter, we earned $4.8 million from the termination of an approximately 99000 square foot third party tenant lease in Calgary, Alberta. The tenant had previously ceased operations and after securing replacement tenants, we proactively negotiated an early lease surrender.
Enabling us to reposition that space into three separate units achieved higher rents and increase traffic to the shopping center.
We also earned $1.4 million related to a partial surrender of space at our Mississauga, Ontario, Loblaw grocery store the <unk>.
Most restore underway size optimization and the surrendered space was back felt by a new tenant at a higher rank.
So as an example of how our team is and will continue to collaborate with loblaw little forward.
Turning to our industrial portfolio occupancy increased by 100 basis points quarter over quarter, primarily due to the backfill of 122000 square feet in the GTA, which I discussed on last quarter's call.
We chose not to renew the existing tenant in the second quarter in order to accommodate the neighboring tenants expansion requirement. They took off piquancy of the space. This quarter at an average rent that was 170% greater than the previous expiring rent.
The balance of the positive absorption was primarily related to 35000 square feet of new leasing in Calgary.
We had 381000 square feet of industrial leases in Alberta, and Atlantic, Canada expire in the quarter.
No new leases in Ontario expired this quarter.
We renewed 364000 square feet at Brent, 11% above expiring and achieved tenant retention of 95, 5%.
We continue to see strong demand across our entire industrial portfolio.
With occupancy and Atlantic Canada at 97%.
And 96% in Alberta, enabling us to grow rental revenue in all industrial markets not just Ontario.
The industrial asset class continues to experience elevated demand and tight supply in key markets, such as Toronto, where the availability rate is sub 2% versus the national average of 2.5% providing good support for continued rental rate growth.
We have significant embedded value in our industrial portfolio as our current national average in place industrial rank is $8.67 per square foot and our average in place rent in the GTA is $8.53 per square foot.
We continue to transact at rents well above current in place rent and believe that well located new generation distribution space will continue its upward trajectory.
I'll now pass the call over to Mario to discuss our financial performance.
And thank you and good morning, everyone. We're pleased with our financial results for the third quarter, we delivered solid and consistent operating performance. Despite the impact of higher interest rates continue to have on our earnings.
We also continued to demonstrate our commitment to prudent financial management to our financial activities.
Starting with funds from operations are reported as a bulk of the third quarter was $181 million or 25 cents per unit.
Included in the bulk of the quarter were lease render income of $6 2 million, which added discussed and a $1 8 million charge related to severance and other onetime employee compensation expenses.
On a per unit diluted basis, our second quarter Footfall 25 cents per unit.
That's an increase of approximately 4.6% from the third quarter of 2022.
Strong see massive NOI in lease rental income.
Were offset by higher interest expense driven by an elevated rate environment and higher G&A expenses, driven by business growth in a competitive talent market.
On a normalized basis, when adjusting for lease surrender income and severance costs <unk> increased by two 1%.
Occupancy remained strong at 97, 7% and was up 30 basis points from last quarter, which contributed to our strong operating results.
Massive cash NOI increased by $10 million or four 4% compared to the third quarter of 2022.
By asset class retail fantastic cash NOI increased by $6 3 million or three 4%. The increase was primarily driven by leasing related activity, including contractual rent steps and higher base rents on renewals and new leases plus higher capital and operating cost recoveries.
We expect retail C method and a wide cabin.
Retail same as cash in Hawaii to trend down over time to the range of 2% to 5% as we start to lap the impact of higher occupancy rental rate growth and interest on capital recoveries.
Industrial same asset cash NOI increased by approximately $3 3 million or nine 1%. This increase was primarily due to higher rental rates for both renewals and new leases completed as well as higher recoveries.
Mixed use residential see massive cash NOI increased by approximately $500000 or six 8%. This.
This increase was driven by improved residential occupancy and other revenues.
Now turning to our balance sheet, our eye for snap increased to $13.69 per unit, an increase of $25 million over the last quarter.
NAV growth was driven by earnings growth of $44 million and fair value gains of 26 million on investment properties. This was partially offset by a fair value adjustment on our investment in Allied property units, a $45 million, where we are required under <unk> to mark to market as investment to its trading price as of September 30th.
Okay.
As a team we've always focused on taking a conservative approach to valuations and are continually assessing the impact of a higher for longer interest rate environment on our valuations as Rob mentioned, we made it we made an approximately 40 basis point adjustment to our overall cap rate in the second quarter from 22, and we continue to assess our cap rates and make adjustments.
Accordingly.
And the court quarter, our fair value gains in the quarter were modest and mainly reflect the impact of rental rate growth.
We recorded gains in our retail asset class, primarily related to contractual rent steps renewals and updated market leasing assumptions and our industrial asset class fair value gains from rent steps and updated market leasing assumptions rosset by cap rate expansion on certain industrial assets with limited rental rate growth and longer weighted average lease terms.
And our mixed use and residential portfolio, we recorded a loss in the quarter driven by the sale of Altea Center. Our final office property sold subsequent to the quarter and general cap rate expansion on our remaining office properties.
We completed several financing transactions in the quarter with.
With strong demand from language blenders translating into relatively low credit spreads we are able to fund our remaining capital requirements in 2023 at a reasonable cost, placing a 10.5 year senior unsecured debenture of $350 million at an interest rate just under five 7%.
As mentioned last quarter, we repaid the $200 million series B unsecured debenture upon maturity in July 5th using proceeds drawn on our credit facility and this debenture at an interest rate of four 9%.
We continue to be conservative with our balance sheet management and discipline and maintaining our balanced 10 year ladder.
In the last 16 months, we have issued $1 4 billion of 10 year unsecured debentures at an average rate of five 6% demonstrating the quality of our credit and the opportunity to both take advantage of a flat long term yield curve.
Create flexibility at the shorter end of our debt ladder with room now at three seven and 10 years for 2020 for refinancing.
Also in the quarter, we obtained $152 million, a Siemens sea insured mortgages at 4.13% for our bricks in east Liberty residential properties and proceeds were used to repay the construction loans on these assets.
So in the quarter and a solid financial position strong debt metrics and ample liquidity our debt to EBITDA ratio is 7.4 times, we have $1 5 billion available credit.
With social supported by approximately $12 billion of unencumbered properties.
As we look ahead to 2024, we have $200 million of unsecured debentures coming due in February and $550 million in September.
With repayment of our ally be T. B at the end of this year plus our cash balances we have sufficient proceeds to camera February maturity, and therefore don't expect a need to gordian secured market until the third quarter of 2024.
So overall this is once again, a very solid quarter, we continue to see the stability of our retail portfolio the growth potential and strong industrial fundamentals reflected in our results more than offsetting the impact from higher interest rates. We also continue to actively manage our portfolio throughout the year and opportunistically capitalize on vacant tenant space in store downhill.
<unk>.
As a result based on our year to date operating and financial performance, including certain nonrecurring items, we've updated our 2023 outlook and where we expect to deliver 4% to 5% year over year growth in CNS and in Hawaii.
An annual F. A full per unit is expected to be between 99 cents and the dollar, reflecting a 3% to 4% year over year growth.
Our revised outlook does not contemplate any potential impact of the special distribution recently communicated by Allied properties.
With that rail and Aaron and I will be glad to answer your questions.
Thank you if he would like to ask a question. Please press Star then one on your telephone keypad.
Our first question is from <unk> Gupta with Scotiabank. Your line is open.
Thank you and good morning.
So just on the re JD lease Expiries next year sliding almost 1.2 million square feet coming due.
What are your expectations in terms of income spreads it looks like you've been achieving almost 10% in the last couple of quarters. So in that context.
Hi, Himanshu.
We are we expect the spreads next year to be consistent with what we've achieved this quarter and that sort of 8% to 12% range.
With respect to the Expiries and that would be.
Inclusive of Lala.
Got it and are you expecting any occupancy slippage adult club in Occupancies.
It's almost like effectively follows occupancy lagged on the portfolio so any slippage expected.
We don't expect any material slippage demand is very strong and tenants are looking to add new stores, but they actually can't find space Theyre actually feeling quite squeeze in the in the market, So and Theres very little new development.
We do have.
All in one space that we have in Alberta that we referenced its about 100000 square feet.
The space that we received about 4.6 million dollar termination.
No penalty. So we've received that revenue upfront and so we're devising that space. So we will have a little bit of downtime as we.
You know demise the space and then the new tenants fixture, so that'll be a momentary dropping her occupancy.
That youll see.
Next quarter.
Go ahead.
And then.
And then on the same store NOI growth.
Again, you know with the Davidians segment, so if you do 10% spread.
And if you know occupancy remains flat.
Would the NOI in our same store NOI shakeups, something like Tudou in hospice went or like a bit higher than that Mario.
Yeah, So again lapping a really strong year yet.
We're gonna give our outlook or promote with next quarter, but yet between 2% to 3% is good we'd look at it.
Okay.
My last question is side, obviously, you know ethical growth was pretty good you know better than what you were initially expecting.
Any called Sean.
Distribution increase next year I mean is that something you consider as a part of your capital allocation Glenn dental distribution.
Hmm H as you would know the distribution policy set by the board bed. What we've said historically is as we have growth we hope to share that.
With M unitholders.
And that's something we will communicate at the appropriate time.
Fair enough. Thank you Wiseman I'd come back.
Again, Please press Star then one on your cellphone keypad, if you'd like to ask a question.
The next question is from two Might've said with CIBC. Your line is open.
Thanks, Good morning.
To go over your industrial segment and see if you're seeing any differences in absorption and demand for large screen versus mid or small b and and Hal ranch, but its trending for each format.
Work high where we're still seeing very very strong demand.
No the market.
I guess I describe it as ceasing to be a hypermarket.
But there are still very very strong demand, especially for well located.
Facilities and I would say location is just as important for industrial users.
As base sizes, and given our portfolio is predominantly.
And make sure well.
Well serviced locations from a from the highway and transportation access perspective, we're not really seeing a slow down and we're seeing very high retention rates as well.
Okay.
And then I wanted to ask about your just thoughts on how you're approaching your development program certain of your peers are pulling back to various degrees and how should we think about your door productivity, maybe in the near to midterm.
Okay.
And.
Thanks for your question.
So Kevin I think choices unique in that as we've said historically, we can develop across the three different asset classes.
And we have lots of resident sorry, rentals, sorry, retail and certifications on the go we have a very significant.
Industrial development pipeline, which we are under construction of about 2.5.
<unk> feeds and we completing two residential projects and the team continues to advance future projects through the zoning bat and hopefully we will be in a position to announce construction.
Of another project and lastly, O need bank next year, and we do feel we need the interest rate environment to stabilize a little bit.
Okay makes sense.
And as lastly in your opening commentary you mentioned.
Tenants seeking expansions.
In non urban markets is this a notable shift from before is either for Steve or I guess, a typical expansion activity and if you can just.
Give some color on the markets and what you see as a major driver.
Yeah, I don't think it's a major I don't think its a shift at all it's something that we've been saying consistently for numerous years debt.
Grocery anchored center says performed very well, we population way people less and people live in are definitely in all areas, including the major market secondary market in tertiary markets and we've been seeing N and her team have been seeing very strong leasing demand from tenants on those centers regardless.
Of the area and we are seeing more activity in secondary markets at the moment.
Just given I would say maybe lack of available space in urban markets, but but it's we think it's it's one of our big competitive advantages having that national portfolio.
And I do any juice up some of it also is attributable to that sort of demographic shift as populations kind of move out of the urban core.
We have population growth in general which is good for all retail and then we have that growth also kind of extending out too.
Markets are further outside of the central business districts, but the major cities.
And retailers want to be where their customers are and theyre looking to increase store count and market share and so.
Many are looking to be in smaller markets than they historically have been T. J X is a great example, David states, they're looking to be in.
And in some of our a more tertiary markets.
Okay, so supportive or for future rent growth as well.
Thanks for the color I'll turn it back.
As a reminder, if you would like to ask a question Thats Star then one.
On your telephone keypad.
Our next question is from Sam Damiani with TD Cowen Your line is open.
Yes.
Thank you and good morning, everyone and congratulations on the great quarter and guidance raise.
It seems like everything is firing on all cylinders and good progress in virtually every strategic also it's a great quarter for for choice.
First question would for me would be a little bit of a follow on to I think somebody asked question just one on the development side with <unk>.
The economics of commercial development, a little bit more appealing today are you seeing.
Adjusted vacation, perhaps to build out the retail on the existing lands that are currently earmarked for <unk>.
Residential and Densification.
Please proceed switching back to retail sacrificing future residential growth.
Look Sam you know one of the things. We believe we are unique as we really take a long term focus to running our business and.
We have.
Many many retail sites for Egencia vacation, we have over 115.
Grocery I could start just for retail it densification and we're not going to pivot and make a short term decision.
An encumbered the land tab, where we could make.
Long term investments on a very stable asset class.
Okay. That's helpful and I guess, you mentioned potential construction start late next year, if interest rates stabilize from here if he could be a little more specific there like what else do you need to see to have the stars aligned for a rental residential project commenced construction for choice or late next year.
Look again I think we're unique we have a very low land cost base very strong balance sheets.
Our biggest issue is that we don't have all that.
Appropriate approvals at terminus, 100%, but adopt so what we do is getting ready with our software and applications at working with construction.
Companies to make sure we can understand and lock in as much pricing as possible and then we'll be in a position to go.
And then we will only Gov. If the interest rate environment is stable and I think if we had visibility if it was today's environment, but weak visibility. There was is stable we would go.
But as I said, the biggest thing holding us back is probably.
Just as I say, we need a bit more planning work to happen and working was.
Construction manages apt to far less pricing et cetera.
Okay and that project that could start late next year is that global model.
So did the tuna would likely we'd hope to be in a position to start which are the nearest to be in a position to sort of golden mile and grateful Grosvenor and likely conclude announcer.
Next year, the construction likelihood or 90 significant construction wouldn't start until call. It two out of 20, Bob that assumes everything goes according to plan.
Okay.
Last question for me, it's just on that Loblaw.
Downsizing and immediate back filling in Mississauga that was interesting and great to see what.
Wonder if you'd be specify the square footage of the old store and the new store and do you see lots of more opportunities to do similar deals with loblaw going forward.
Hi, Sam I'm going to reflect on 100% correct, but the news the store footprint was just over 100000 square feet and then they surrendered about.
38030, 5000 square feet.
So I'll, let you do the math on what the new store sizes.
Yes.
Yes.
And we see lots more opportunities for those Ana in the in the portfolio.
You know there is demand from tenants and they come to us and we will continue to work with loblaw as these opportunities present themselves.
And I think that's it.
It's a benefit of the relationship we have and the uniqueness of our portfolio that we're able to capitalize on these opportunities pretty quickly. So I imagine there there will be others in the future.
Okay.
Thank you I'll turn it back.
The next question is from Tony Berg with RBC capital markets. Your line is open.
Thanks, Good morning, just regarding the $93 million as assets sold post <unk>.
After Q3 can you just comment maybe on the on the types of buyers there.
Maybe where pricing came in from a cap rate standpoint, or or even a range. If you can share that and then I'm also just curious if there is any color you can provide on the on the Altea Center sale.
Charlotte So.
I think the blended cap rates M handy.
But on the Altea Center sale.
<unk>.
The buyer is a private buyer they actually are going to use part of the space. Our understanding is called they have some interest in some other businesses. So they would move some of those oil businesses into the space bed Calgary office is a very very challenging.
Environment I did in my opening remarks, Tom in your property unfortunate messages given that the issues, we're having with the call, but I did speak to the three assets. We sold we sold we the Park Tower Center All T S.
With the two significant ones that we sold.
And then some small industrial there were two significant ones will lead that Ed Altice.
<unk>.
Just on memory the cap rates ranged from.
Six to altice as high as call. It a benign but altice is more sold on that on a price per foot.
Basis, and the larger retail asset was probably mid sevens.
Mid sevens for the for the retail Okay. That's helpful. Thanks for that.
And then just really one last one for me on the Loblaw lease renewals that.
And I think you mentioned in the quarter at a 757, 5% spread.
Would those leases also incorporate one 5% annual steps going forward and if you can just comment on the extension term is wide.
Okay. So just to clarify I think I saw in the quarter.
2003.
The leases expired in 2003, and so we reported that we did that renewal last year and so that had.
Average.
Got it.
Five year term it had an African place increase of.
Six 8%.
And then the 2024 renewals that we just disclosed.
Last quarter the increase there is seven 5%.
The increase though it's a.
That's the that's the that's the increase that it's flat over the over the term out to that five year extension.
Okay, Okay got it.
That is that's it for me thanks very much.
It appears that we have no further questions and again I would just say to apologize for the technical issues on our webcast. This morning collaborate complete recording.
Have you been will be posted onshore properties website later today.
And with that I'll turn it back to the presenters for any closing remarks.
Thank you Chris to summarize we're very pleased without third quarter operating performance and radian, a volatile economic environment.
With lots of pressure on the industry, we are really well positioned to execute on our street T J priorities and deliver strong and consistent operating performance. Thank you for your interest today your investment in choice and for joining us today.
Enjoy the rest of your day. Thank you.
Ladies and gentlemen, this concludes today's conference call. Thank you for participating you may now disconnect.
Please wait the conference will begin shortly.
Okay.
Yes.
Okay.
Okay.