Q3 2023 Broadstone Net Lease Inc Earnings Call
Hello, and welcome to broad stone net leases third quarter 2023 earnings call Conference call. My name is cole and I'll be the moderator for today's call. Please note that today's call is being recorded.
I'll now turn the call over to Mike Caruso, Senior Vice President of corporate strategy and Investor Relations at <unk>. Please go ahead.
Thank you operator, and thank you everyone for joining us today for <unk> third quarter 2023 earnings call on today's call you'll hear prepared remarks from CEO, Jon Marino, President and COO, Ryan Albano and CFO Kevin final.
All three will be available for the Q&A portion of this call.
Before we begin I would like to remind everyone that the following presentation contains forward looking statements, which are subject to risks and uncertainties that can cause actual results to differ materially due to a variety of factors. We caution you not to place undue reliance on these forward looking statements and refer you to our SEC filings, including our Form 10-K for the year ended December.
Remember 31 2022 for more detailed discussion of the risk factors that may cause such differences.
Any forward looking statements provided during this conference call are only made as of the date of this call I will now turn the call over to John.
Thank you, Mike and good morning, everyone.
In what continues to be a challenging and dynamic net lease and capital markets environment I am pleased to report another strong quarter of results.
As you've heard us say consistently throughout 2023, we believe are prudent and highly selective approach to capital allocation is the best path forward in our mission to maximize long term shareholder value.
Our third quarter results and slightly revised guidance for 2023 reflect that.
While we are maintaining our <unk> guidance range of $1 40 to $1 42 per share for the year, we are slightly adjusting our investment disposition and G&A guidance.
To come from Kevin on this.
Notwithstanding the difficult environment, our pipeline of potential investment opportunities continues to grow as we evaluated over $10 billion in potential new acquisitions.
Our third straight quarter of sourcing above average volumes, while sourcing and underwriting remained highly active the number of investment opportunities that met our buy box were minimal as interest rates expanded nearly 100 basis points throughout the quarter.
And the dislocation between public and private markets continued to widen with new investment cap rates lagging the pace of interest rate increases.
Of particular note.
We recently walked away from a large significant late stage investment opportunity as we could not agree on final pricing terms amidst the rapid increase in rates.
The lag we're seeing in cap rates and risk reward tradeoffs has been a persistent theme for this year and the recent run up in interest rates and treasuries only exacerbated that disconnect further.
Despite that.
We remain opportunistic in sourcing investment opportunities and are committed to the prudent patient and disciplined capital allocation strategy, we have employed throughout.
2023.
We continue to believe that strategy will be key to avoiding missteps in such an uncertain market and providing long term shareholder value.
Given the current investment environment and our <unk>.
Highly selective strategy, our third quarter results were driven by continued solid portfolio performance and incremental asset recycling during the first half of the year, our existing portfolio of 800 assets with 220 unique tenants cooperate across 54 different industries and our best in class diversification have positioned us to provide durable and consistent.
Cash flows across any market cycle.
We continue to view, our tenant and industry diversification is a key differentiator for <unk>, which when combined with top tier annual rent escalations of a weighted average 2% provide significant downside risk mitigation benefits, especially in difficult or uncertain markets like this one.
Our real estate portfolio, which is predominantly leased to industrial and defense of retail and restaurant tenants continues to perform exceptionally well.
As evidenced by 99, 9% rent collections during the third quarter and 99, 4% occupancy as of September 32023.
As of quarter end only two of our 800 properties were vacant and not subject to a lease we have seen corporate or site level improvements in many of our headline watch list tenants.
The main lingering issue on our portfolio continuing to be Green Valley Medical Center.
Similar to our update last quarter, the tenant continues to fail to meet certain milestones as defined by our agreement.
Based on the tenants lack of progress we are no longer anticipating operations to commence in Q4 of this year, while we have yet to receive rent that commenced on October one the tenant continues to maintain the property and cover carrying costs we.
We are closely monitoring their progress towards reopening the hospital, but we have also begun evaluating all potential alternatives and may look to bring a clear end to the outsized distraction that this single asset has caused our company for over a year.
As noted in my comments earlier, we had only a limited number of investments that meet our criteria during the quarter.
With the majority of investments driven by development fundings and revenue generating capex.
With current tenants and developers has created additional ways to add value and continues to supplement our more traditional investment sourcing efforts.
Our team remains focused on these relationships along with establishing new partnerships further diversifying our business.
Despite the challenging lending environment. We have continued to have success selling select assets that either possessed a credit <unk> residual risk throughout the quarter.
These sales continued to provide benefits in both mitigating risks within our current portfolio. While also building dry powder to be accretively recycled when the time and investment are right.
The resiliency of our portfolio paired with our flexible and fortified balance sheet gives us great confidence as we navigate this higher for longer interest rate environment.
We ended the quarter at four nine times leverage on a net debt to annualized adjusted EBITDA or <unk> basis.
US ample liquidity and flexibility to deploy capital when an investment opportunity meets our criteria.
I've said this before and I'm sure I will say it again.
The decisions, we made throughout 2022 and year to date in 2023 continue to put us in a position to make decisions that we want to not decisions that we have to.
Which remains an important distinction in today's real estate market and.
In a higher for longer interest rate environment for the outsized growth of the post TFC years will be difficult to achieve.
Operational expertise financial flexibility solid portfolio performance and durable cash flows will be key to success and you have seen all four of those things from P&L throughout this year and you will continue to heading into 2024.
With that I'll turn the call over to Ryan who will provide an update on our portfolio.
Thanks, John and thank you all for joining us today.
As John noted our efforts in disposing select assets that either possessed a credit or residual risk remains successful throughout the quarter.
We sold two properties for gross proceeds of $62 3 million at a weighted average cash cap rate of six 2%.
Year to date inclusive of asset sales closed since quarter end, we have sold 11 properties for gross proceeds of $189 1 million.
At a weighted average cash cap rate of 6% on tentative properties.
We intend to continue to opportunistically execute on asset sales in the fourth quarter and into 2024.
On an external growth front price discovery in the transaction market persists.
Upward trajectory of Treasury yields continued to influence the capital allocation decisions of buyers at a more accelerated pace than the price expectations of sellers.
Adding to widening of bid ask spreads and an overall decline of the transaction volume in the broader market.
As John highlighted we remain focused in our efforts of sourcing the right investments and highly selective in the pursuit of opportunities as the market continues its price discovery.
Our investment activity during the quarter consisted entirely of fundings related to UNFI and incremental revenue generating capex.
UNFI, our previously announced $204 $8 million build to suit transaction remains on track to open in the third quarter of 2024 with rent commencing no later than October of next year.
Year to date, we have funded approximately $58 $4 million and expect to fund an additional 37 5 million throughout the remainder of the year.
We will continue to look at similar opportunities to partner with developers in this capital constrained environment, while remaining highly selective and cautious as the macro environment evolves.
From a watch list standpoint, similar to last quarter, we still do not see any notable overarching somatic trends across our portfolio.
Specific assets, such as Red Lobster, Carvana and Green Valley Medical Center remains a key focus.
While we recognize that red lobster continues to evaluate ways to improve the company's overall operating performance site level performance across our sites continues to improve.
We remain focused on these assets and will look to confirm these trends over the next several quarters beginning the Thai unions third quarter results, which will be released next week.
And through ongoing corporate and site level financial reports.
As for Carvana, we remain confident in our investments defensive positioning driven by both the mission critical nature of our industrial sites as well as the longer term fundamentals in the sub market in which they are located.
As we highlighted last quarter, we are encouraged by the steps. They took during the second quarter to increase the company's financial flexibility and its planned path forward.
With that I will turn the call over to Kevin for commentary on our financial results for the quarter.
Thank you Bryan turning to our financial results during the quarter, we generated <unk> of $70 million or <unk> 36 per share an increase of one 3% in per share results quarter over quarter.
Results were largely driven by same store portfolio growth and incremental asset recycling in the first half of the year.
Additionally, we incurred $7 $9 million of cash G&A and tracked slightly better than planned.
We once again ended the quarter in a strong financial position despite no capital markets activity.
Our success in disposing of selective assets allowed us to further reduce the balance on our revolver by $49 million in the quarter, resulting in more than $925 million of remaining capacity.
From a leverage perspective.
We ended the quarter at four nine times down slightly from five times at the end of last quarter.
Given the current market dynamics. It is worth reminding everyone again that are mostly fixed rate debt capital structure has insulated us from the surge in interest rates and the higher for longer expectations.
At our quarterly meeting our board of Directors approved a 28, 5% dividend per common share and op unit.
This is a one 8% increase compared to last quarter and a three 6% increase over the dividend declared in the fourth quarter of 2022.
This quarter's increase marks our sixth semiannual dividend increase since our IPO and is payable to holders as of December 29 2023.
On or before January 12, 2024.
The dividend remains well covered and aligns with our targeted payout ratio in the mid to high 70% range and represents an attractive dividend yield relative to many of our peers.
Finally, we are maintaining our 2023 per share guidance today with an <unk> range of $1 40 to $1 42 per share.
We've been navigating this year with a focus on strong operating performance and self financing our capital deployment.
As John alluded to in his comments, we are revising our investment volume and between 300 $500 million.
To up to $250 million for the full year 2023.
Brian talked about our success on the disposition front. We're also revising our total disposition volume from between 150 and $200 million to approximately $200 million.
Finally, G&A has been well controlled throughout the year and as a result, we are revising cash G&A from between 32% and $34 million to between 31 and $33 million.
Please reference last night's earnings release for additional detail and we will now open the call up for questions.
Thank you.
Like to queue for a question. Please press star followed by one on your telephone keypad.
If for any reason you'd like to remove that question. Please press star followed by two <unk>.
Again to queue for a question. Please press star one we'll pause here briefly ask questions are registered.
Our first question comes from Mitch Germain with JMP Securities. Your line is now open.
Thanks for taking my questions I appreciate it guys nice quarter.
This is the second quarter in a row, where we've seen a bit more of industrial.
On the disposition front and I'm curious is it I know that you guys have talked about.
Specific assets and what the requirements are for.
For you to sell but is it also a little bit where the demand is in the market for sales.
Yes, it's a little comment a little combi.
Thanks for joining Mitch we certainly have continued our trend this year of looking at dispositions, where we continue to have either credit or lease rollover risk and so we're looking to do risk mitigation at the same time they are trying to generate proceeds.
And to hit the old cliche in many cases real estate is a local game and so when we're looking at where we have an opportunity to sell something particularly when more than 50% of our portfolio is made up of industrial assets theres going to be some industrial assets that make their way into it there still continues to be some good demand for those assets and where we've got some concerns we're happy to move some of those along.
Great and.
John the runway. So if I think about obviously you guys have fantastic balance sheet lots of liquidity, but if im thinking about your funding.
Growth heading into <unk> in 2024.
How much of a you still have a pretty decent runway in terms of the ability to sell properties in this market.
Yeah, Yeah, we feel pretty confident about it.
Our current view and you can call it conservative, but our view is that 24 is going to look a lot like 23.
We're not anticipating that the equity market is going to turn it away, where we're going to be raising significant amounts of equity capital. If at all so we will continue to look to self fund and control we can control and so we've got ample pipeline of opportunities that we're evaluating on the disposition front.
All the things that are in the same vein if we looked at this year looking at some incremental reductions in health care exposure and.
And so we'll continue to do that and prepare ourselves for another run at 24 like we did for 'twenty three.
Got you it seems like you've got some frustration regarding green valley needle, where do we hit.
A certain head where you start to evaluate alternatives there.
We're already there.
Green Valley as I said in my prepared remarks has been the single largest distraction that we've had as a company over the last year.
Where we stand today, we have 800 properties and the large majority of my time and almost every conversation I've had externally has been focused on one of them.
We have been absolutely hopeful and supportive of our operator and trying to get them up and running we will continue to do that.
But at the same time this has been an outsized distraction, it's 8% of our ABR. So its immaterial overall, we did not include any rent and our 23 guide we will not be including any rents in our 'twenty forgot.
So it doesn't have a material impact on how we're thinking about financial results for this year or for next year and it's time to look at all the options we have to clean that up as we can.
Is it a labor issue.
There's a host of things related to that particular asset.
Both the market itself.
As well as sort of structural problems that you would see if youre looking at that type of hospitals throughout the country.
We're lucky to have a member of our board of directors serve as one of our regional Ceos for one of the largest hospital systems in the country and speaking with her about the difficulties that sort of regional community hospitals like Green Valley are experiencing throughout the country and the number of ones that are shut down even in the last 12 months has been very helpful for us understanding the sort of <unk>.
Ask profile of this asset.
Helping confirm our view of where we need to take them.
Thank you much success guys I appreciate it.
Yes.
Our next question is from Eric Gordon with BMO capital markets. Your line is now open.
Hey, guys good morning out there.
Maybe just starting with Green Valley.
Was.
Just given the fact that they didn't pay rent in October what is the expected drag on <unk> and then maybe could you just talk about some of the different options that you are currently evaluating as it relates to the asset.
Sure. Thanks for joining here no.
No impact on <unk>.
We had already built into our guide that they weren't going to be paying rent.
And they are covering all the carrying cost as well as maintaining the properties. So there is no leakage for us with respect to the asset right. Now so there is no impact on <unk>.
And from a sort of opportunity standpoint.
We still are working hard to try to get up and running and so there's a good chance that that's what happens.
And our focus on trying to minimize the distraction caused by the ask.
We have worked to engage local brokers to help us evaluate possible returning options as well as to sell the asset. So we're looking at all possible options here.
Okay, that's very helpful.
One on Carvana I know, we've talked in the past and you mentioned in your prepared remarks, how it's crucial to other operations.
Recently received a re rating and the stock's up 500% that year to date, but on the other hand car loan defaults are on the rise just given the weakening consumer how are you thinking about your exposure to the auto industry at this time.
Yes, I mean, it's great to see Carvana have the improvement that <unk> had this year it makes us feel better about it.
But we keep coming back to that as a real estate play at heart. It's 140 acres of graded industrial land and a great industrial submarket outside of Indianapolis that has a lot of potential uses to it.
So the residual value there was key to how we thought about making that investment and this is key to how we think about if there ever were to be something that happens with carvana, where either they go through a restructuring and they go through a liquidation we feel comfortable that we'll be in a pretty solid position to maintain the value.
Okay. That's helpful. And then one last one maybe just on the acquisitions under control, what's what's kind of the breakout there. The $76 1 million is there any developments in that pool and what is the expected pricing on those assets.
Sure the breakdown there is primarily leaning towards industrial.
I'd say, there and upwards. If you look further up the pipeline not under control there are certainly development opportunities that we're looking at.
But it's a predominantly industrial weighted with a little bit of.
Retail mixed in there as well.
And then in terms of economics, we're looking at things.
Certainly north of 7%.
Okay. That's helpful. Thanks, guys.
Our next question is from Spencer I'll away with Green Street. Your line is now open.
Thank you.
You talked about a widening bid ask spread can you guys just comment on the magnitude of the spread you're seeing currently and are there any property types or industries that stand out as having a larger one average bid ask spread.
Sure I'd say.
We've seen the bid ask spread probably wide now in some cases.
Why not maybe 25 bps, maybe even 50 bps, what I would say is there is certainly.
Yes.
Last bids on deals.
And those bids are a range in terms of what the economics are that.
Buyers are looking for I would say I've seen things probably about as wide as 200 basis points from top to bottom of the bed range. Obviously there are other terms involved.
That are at play that sort of drive some of that spread differential, but that's probably the widest I've seen it in quite a long time.
Okay. That's very helpful and then as you think.
What youre aflow growth would be next year absent any external growth.
Yes, I think I'd point, you towards the low single digit figure based on our embedded.
Bumps of 2%.
Run rate for us is in that low single digit growth.
Okay, great. Thanks.
Spencer I'll finish the question if you step forward a little bit more on run rate given unfi's impact when you when you think through that starting in October.
Tober next year that number takes a decent bit higher for 2005.
Thank you.
Our next question is from Keybanc, Kim with Truest. Your line is now open.
Hey, Thanks, Good morning, Jeff.
Just going back to Green Valley.
Can you just talk about how that how deep is that potential pool of different operators that can operate that hospital and secondly.
How is that nurses strike.
Indirectly or directly impacting potential operations there.
I'll take the second part first good morning, Kevin.
They are having.
Any sort of difficulty that you can imagine in terms of getting this thing up and running between the licensing process that they have to go through between looking at staffing pharmaceutical licenses.
Financing on these things and all sorts of stuff. So I wouldn't attribute the delay to any one particular thing certainly nurses strikes that are happening are helpful for the health care system generally and certainly arent helpful for.
Folks that are trying to get a new hospital up and off the ground, let's take the first part of the question this isn't huge.
Pool of potential operators that can come in there.
Between state licensing as well as population density and the way that the health care.
Production system is in surrounding this area theres only a handful of players that could potentially have an interest in it and it may need to be something that you rethink the use of the physical space.
Or maybe it's getting cut up into a different direction.
Got multi tenants that are potentially being there or someone who thinks about using a portion of it. There is a whole lot that we have to think about and we're still in that learning phase so more to come.
And you have 18% of the portfolio dedicated to health care.
The nurses not impact operations through equity, but it does cause a higher benchmark for wages are you seeing kind of a follow through impact on perhaps the cost structure for your health care tenants.
None at the moment, but I think it's also important to dive into the particulars of what our health care portfolio is.
You can't paint with a broad brush in the 18% that we have about 7% of that is clinical and clinical assets would have nurses on staff and onsite and so maybe there's a little bit of a read through to those assets, but then the other 11% of our ABR is a variety of things, including what would.
Traditionally be considered med tail type assets plasma centers dialysis, we have a decent chunk that's committed to veterinary services.
Which wouldn't have those types of issues and then we also have some sort of more R&D type facilities that would be included.
And our health care bucket. So you can sort of look at it as a monolith and it's a fairly small percentage that we do have and there is not any.
To ensure that we have at the moment on that type of nurses strike issue.
Thank you.
Yes.
Our next question is from Michael Gorman with BTG. Your line is now open.
Yes. Thanks, Good morning, John maybe just stepping back for a second.
And talking about dividend policy, obviously, nice little increase in the quarter stocks, yielding about 8% in a market that seems to want to pay more attention to dividend yield, but given what we're seeing just generally in the cost of capital environment. How are you thinking about balancing continuing to kind of increase that payout to invest.
<unk> versus <unk>.
Retaining what is probably your cheapest cost of equity capital here. So how are you balancing out the payout versus retained cash flow for future growth.
Yes, good question Mike.
It's something we talked about a lot and.
When you look at the hard dollars. The total amount of increased dollars are going go out the door. As a result of this dividend increase is about $1 million. So it's not a huge amount.
But it is something it's $1 million that could be applied somewhere else from a capital allocation standpoint, where we came.
It came down on was that in the current environment as I sort of mentioned in my prepared remarks, the outsized growth that the net lease sector has experienced in the post <unk> world for that 15 year period or so.
Feels more and more difficult.
Not to say that it's not going to come back and it's unlikely but at the moment, we've gone through the entirety of 2023, we're looking at 24 and also I think a lot of our peers are looking at 'twenty four being very similar to 'twenty three and so in a period when youre not seeing the type of external growth and the outsized return expectations that come from that.
Which is fed by a low interest rate environment and much better cost of capital than what our industry is currently experiencing.
We turned and looked at Okay, then we need to do better as real estate operators and as I mentioned in my remarks.
Operational expertise financial flexibility solid portfolio performance and durable cash flows are going to be key to success in the short term and potentially longer term. If you don't see a significant change in cost of capital. So when we looked at that and we thought about how do we provide the best possible value for our shareholders and the highest possible total shareholder return continuing to provide them with solid dividend growth was a key part of that so that's where we came down on that decision.
No that makes sense and I agree and I'm curious as you think about 'twenty four and you look at the opportunity set.
Obviously as you mentioned <unk> got some skill sets here in terms of operations and redevelopment and development.
Understanding that the.
<unk>.
Cold storage facility is a pretty big lift through October are you seeing alternative opportunities to step into broken development step in on sort of mezz financing on properties you'd ultimately like.
To own at the end are you seeing any more unusual opportunities away from the regularly regular way acquisition market Thats pretty slow.
Yeah, no absolutely we are and Thats actually the place where we continue to see what we think are the best possible opportunities.
<unk> acquisition market has been slow to adjust to rising interest rates and treasuries and cost of capital reality for people that are on the buy side, particularly now that you are.
Seeing a full drop off of the P/e buyer in the 10 31 buyer there is a much smaller buyer pool than there was before and as Ryan talked about earlier that bid ask spread is still pretty high and sort of a traditional market, but where you see a lot of difficulty for folks right. Now is in those developments as in those sort of creative capital allocation decisions.
Where they are having difficulty finding their traditional sources of financing because the bank real estate lending market is completely seized up so that's a great opportunity for us to step in and provide them with a unique source of new capital.
We're just in the process of looking at those evaluating I'm trying to make sure that those fit within the net lease wrapper and will be something that is readily digestible by the market and not something too far afield.
Great and then just last one for me and Triangulating a few of the comments that you had in prepared remarks in prior questions.
You mentioned.
The deals kind of not fitting within the buy box.
Lastly from a cost of capital side, but then also with the dispositions kind of some credit risk or some tail risk on the tenant side.
I'm wondering if given what youre seeing on cost of capital if you've adjusted your tenant credit buy box in terms of what would actually make you comfortable in bringing new tenant credit onboard.
Sure I would say yes.
There is not a one size fits all.
In terms of how we're thinking about that today. However, we certainly have.
Adjusted the way that we're looking at and how how we're thinking about bringing potential new credits online.
In addition to that I'd say is that also goes for the real estate fundamentals I would say.
We always look for a balance between the two.
But we're in an environment, where we've got <unk>.
Pricing backing up and we've got <unk>.
<unk> strain across the market in general.
<unk>.
How long does that persist is a good question at this point. So we are certainly.
Written up the way that we're looking at things and I think you see that in terms of our selective now.
Great. Thanks for your time guys.
Okay.
Our next question is from Ronald Camden with Morgan Stanley. Your line is now open.
Hey, Good morning, you have Jenny answer wrong I just have two.
Quick one the first one is if I dig into our pipeline.
Q3 investments.
So in this higher rate environment for Q4.
You want to compare with Q3 are your Neil conversations going on right now still kind of interesting pace.
Every part of you rather want to wait until early 2020 for any color on the pipeline would be helpful.
Thank you.
Sure.
I sort of zoom out for a second.
Say that if you look at Q3 of this year versus Q3 of last year on an overall transaction closing basis for the market as a whole not just specifically is down about 66%. So I think that tells us pretty much everything you need to know from our perspective, we're looking at it being very selective we've had a lot of commentary around.
That as we look forward here, we're looking for prices to continue to adjust.
<unk>.
Late summer, we have seen 100 bps change in treasuries, so just the risk free rate alone.
Pushing the change in asset pricing or asset pricing expectations from a buyer perspective.
And we're being highly selective so I think what youre seeing is probably late Q3.
But we have a number of opportunities that we're looking at today.
That has either been broken in the past.
And we're looking at ways that they are good deals.
Just capital capital behind them is no longer there.
But they take time to sort of come through the finish line.
Makes sense the second I'll answer all your cap structure I hear you said youre not a planet planning to use ATM program.
Future debt.
You mentioned as well the cap rates are continuing to go up not only from acquisition for us.
So from the drought.
Curious if cap rates continue to go out like how do you measure whether you want a rather light.
So as we cycle the following acquisitions are.
Further ATM program as you can.
Talk about privilege now would be great. Thank you.
Yes, I think the heart of your question is on the source of funding I'd say, we've got a pretty big runway in front of us with where our balance sheet sits today and.
Set a baseline expectation on considering the leverage our disposition opportunities as we think about where we can redeploy that money.
As John has mentioned I think quarter after quarter. After quarter. There is there is not a world where we're thinking about it.
Equity at these levels.
Especially where the transaction environment currently sits from an opportunity set.
Sure.
Yes, I guess.
I'll ask another one just sort of a pipeline from do you think you will be focusing more on the industrial sector.
Yes, I would say when I look at our pipeline today and even further up from what we have under control I would say, it's weighted towards industrial and then with the second waiting towards retail.
Okay very helpful. Thank you very much that's helpful. Great question.
We have a follow up question from Keybanc, Ken with Truest. Your line is now open.
Thanks, just a quick one on the <unk>.
On the large development project you have for BNP.
Can you just remind us how you are treating the cost to funds that you're capitalizing cost and when do you start booking that income.
Given everything.
Associated with that development is hung up on the balance sheet. So youll see the asset grow both from the dogs, We fund, but also the interest associated with it and then when it comes online in October that's when I'll start hitting the P&L on both fronts.
Okay. Thank you.
Yes.
There are currently no further questions registered so I'll pass the conference back to the management team for any closing remarks.
Thanks, everybody for joining us today I appreciate all the questions and looking forward to seeing many of you in Los Angeles at NAREIT in a couple of weeks have a great rest of your day.
That concludes today's conference call. Thank you for your participation.
Now disconnect your line.
Yeah.
Thank you.