PDM - Earnings call transcript Q3 2018 | Piedmont Office Realty Trust, Inc.

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Operator

Greetings and welcome to the Piedmont Office Realty Trust Third Quarter 2018 Earnings Conference Call. At this time, all participates are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Robert Bowers. you. Thank

begin. may You

Robert Bowers

and Good call. welcome our Last X-K earnings and Operator. the information quarter quarter. third Form Piedmont's XXXX an release our includes conference night, that unaudited morning you, supplemental to for and third XX-Q our Thank we filed

defined you've reviewed to company's the as it's of Litigation forward-looking prepared and answers this If questions Securities available site, will Web statements call, our not On the the under today's already your Reform contain piedmontreit.com, XXXX. Investor information Private on by Relations section. remarks Act

to Forward-looking and actual statements income, dividends, address Trust investment risks those of matters leasing and guidance, differ related financial to and include that which we the Realty well are to cause statements revenues, today. as Office future Examples subject activity. forward-looking future may operating from as discuss uncertainties results those Piedmont

the and risks We company's forward-looking You speak the review forward-looking only should with of listeners to our detailed any not the of in contained statements these with they filings SEC. on to place more undue discussion statements these all reliance of date related are associated statements, any as the encourage made.

the Executive Miller, highlights. Chief site. a operational of summary our financial discusses as reconciliations and the call, review after company's I'll to In addition, information supplemental available measures on the FFO, our measures same-store Don such are Web the financial our refer during non-GAAP recent financial some FFO, NOI. non-GAAP Don? of The results we'll and AFFO core definitions quarter's contained Officer, in of

Don Miller

call. to the join you thank and Good morning everyone taking for time us today's on all

in activity Piedmont this we management on focus some in every same-store measure leasing vacant third NOI rent of Washington, each and in the we especially negotiations. are key of markets particularly space of pleased rollups, the Almost cash strong accomplished, to and We and terms tougher quarter. increases, achieved cash during from economic of with quarter, GAAP Houston same-store results excellent leasing amount We D.C. GAAP the extremely our excelled realized strong in our that

also term averages capital recycling We lease being slightly per on our plan, above was of square progress heaviest and most CapEx per only done made foot of year the CapEx long-term tightly, managed our our despite within markets. leasing our G&A

closely a pleased of Looking leasing that leasing new feet leases related space noticeable was recent activity completed first for the the We portfolio. there most that are we portfolio. at for to increase to of our and majority quarter, in our XXX,XXX across currently particularly approximately vacant the say results square leasing, in

for quarter west a for transaction last building Enclave As Place, was our announced quarter newly-constructed a single portfolio up ago, corridor over the quarter result, but a energy our for weeks square entirety XX-year from the reported XXX,XXX in XX% reached largest alone. at lease first-generation Significant end, in-service of Houston. occupancy leasing foot the couple was of the X.X% the of

than last as thus due While X% oil Houston did of Place transaction, and we the to completing a Enclave Based much has and original upon we thought the this rents largest and obtain in net under leases of our achieving GAAP far pro lease recognized XXXX. in three Combining achieved forecasted cash the conditions we effective two yield, renewal with of just approximately equivalent prices, original an forma. Schlumberger expansion ago. Piedmont lease returns better quarter's been lease development's not realized years possible two to the decline terms

included currently almost of XX,XXX addition, was new good D.C., portion In of quarter of space. feet remaining leasing our in Washington, leasing a for vacant the square and

signed available during over and last information our are remains the that quite is review of leases A is that competitive. filed supplemental for quarter market XX,XXX all but this market, night, the list were detailed was on encouraged quarterly the with site. We in Web square activity your in the feet

of Given momentum leasing vacant by that the we our for up could space have no push further occupancy significant continuation year, the even remainder expirations the year-end. for of any

the Our one at prospective the XX sizable months Broad. progress State expiration we towards is, over to XX next make steady York New course, of And continue renewal. a

along XXXX, advance backfill devoting towards current appropriate are expirations, portions tenant of place smaller activity expiration to of resources and in there upcoming the We negotiation, taking well this in with solid is known dates. other move-outs

as lease anticipate Philadelphia, would We as and fully implications of projects proceeds and market and for during quarter, sell to only of Boulevard XXX with third the to remaining the term tax we to use our will these sale, our $XXX a average contract Enclave Market in down this acquisition during as currently activity operating years. valued operating properties our markets to disposition and company close Turning our million, expect such approximately of from West the These allow. are impact binding the markets, conclude conditions Brand will in in as selling leased, this two of XX exit North quarter, transactions. XXXX at an we entered Street, fourth transaction strategic With Considerations Houston. assets are well which outside timing assets and into eight remaining XXX% eventual projects two these Coast.

operating use enhance Piedmont acquiring for drive However, will the select when our to Orlando, funds developments assets be value, shareholders. several of particularly strive available to meaningful occupancy shareholder at of that at model I improving our funds in and ways and paying to we relative build-to-suit in judiciously growth, net used sheet stock redevelopment XXXX. trading our believe our will NAV. markets, will we'll proceeds the XXXX that be always, that our funding Atlanta that such as rental value buying parcels, redeploying assets by evaluate is as and will prudently and continue the enhance seller it existing discounts own to And value located to we will projects us to options our down and maximizes debt, note balance into in Disposition core a in strategic

quarter-end, our along we an for appreciative close acquired leased Norman had XX% of the into are provides is of seven-story Class that Pointe located of year of cash in example, and Minneapolis property of represents immediate I building XXX% great the lease restructure A our the great Cargill set the XXXX. dedicated to am property is at in subsequent team, from which XXXX. property to XXX,XXX $XX.X And pleased that all transactions. in property cost. purchase all very As price in Excelsior Boulevard, Incorporated. built we employees Obviously, is a to year. approximately a was leasing, to This discount XXXX of XXXX acquired and effort quarter. people. that carrying proximity And management to and a an a treasury GAAP yield, with rest the a Piedmont million, to XX% group this and The currently almost expire by committed our into replacement Cargill next It's the upside capital end value-added momentum

platform. Officer. business, succession finance operations. to to Officer, working will but managers outstanding and planning With certainly as promote Brent the as is President equally performance For corporate the Investment Brent the senior turn strategy and our from with have robust skills. call task Chief as the promotion our leadership financial of on obviously that, across areas by our voted of estate of to Smith, Officer, and role Brent's change been ongoing an taking my real promotion Board I Executive program part I several closely strategic applies me Bobby? leadership more role in His Chief Chief results all be merited activities. and Board each and with does not This to to well. to third the working financing Bobby Investment a over senior broader This Yesterday, quarter will review years,

Robert Bowers

Thanks, of but review you Don. please for discuss filings I quarter, for financial to night's I'll complete our more last encourage details. some highlights the

have impact $X.XX or of July were quarter to XXXX. quarterly last increase favorable share the and diluted growing in quarter few both our sale share regular the data rates $XXX well and the weighted for AFFO XXXX, occupancy million of and of a our of per since operating in third the lower assets in nearly the a been dividend. years, activity the million ago third the share compared reflects of the FFO increase for steadily expenses as last outstanding. in average year XXXX, over rental XX The was improvements well For which repurchase as reduced core $XX per approximately share, $XX.X despite per excess of shares $X.XX million months, XX net a FFO

third end now years. remaining percentage lease of as overall Don weighted quarter and increased earlier, average our over X.X the in-service As the XX% is of term to the mentioned our portfolio of lease

Importantly, our overall the leases XX.X%, economic occupancy percentage after We paying continue to to to of commence tenants concessions continued our and this into lease improve cash improve which and reflects abatement anticipate the portfolio. occupancy economic occupancy also to expire. XXXX rising level of

XX.X% For executed GAAP a X.X% on leases cash basis and on X.X% basis. on increased year-to-date mark-to-market XX.X% risk On a completed during on basis. basis, a GAAP a increased the the basis risk cash quarter, and mark-to-market

statistics as our various net rental growth reflect well growth metrics income in same in store also Our rates. operating overall percentage the lease as

same-store NOI expire we're X.X% and cash the NOI extension. annualized during XX to new to quarter. a more a the on for and a plus for line XX, points, million an our which last X% million with financing third increased previous to ended as well two for updating new compared basis And be entire XX as year. XXXX.as in result, point X% cash same-store of growth unsecured our LIBOR leases X.X% is our transactions September replaced average facility same-store has years' We from decrease XXXX X% four the instruments and on with unsecured to As a X%. four-year abatements previous line $XXX a between annual our up NOI year months accrual priced growth did three We basis commence This basis basis as $XXX term line of credit one-year complete a facility. the at

January its renewing XX XXXX by for XX XXXX our rate months. XX, That's to points term we $XXX on XXXX. X% credit, line interest from also LIBOR. of amended to the reduced our stated addition XX, And November extend basis this date unsecured In over million immediately we to to maturity debt loan

schedule. be However, debt was to the this maturities primary late XXXX to maturity rationale under options available debt range company moving broader maximize refinance and term in that upon is XXXX to maturity options the maturity overall seven debt us a debt structures of now our to consider XX-year from The each five, to enables Debt refinancing year the including our this schedule. under for will extension tenders. XXXX debt our future revised expiring

XXXX, our end of not next is XX.X% As third a of at result third the the quarter. until quarter our overall activity, and leverage maturity the ratio this is debt of

anticipate acquisition we and net therefore pay XXX to However, down disposition million proceeds quarter our during as our debt Excelsior Brand using the fourth in further metrics the North $XXX will balance acquisition activity the any the from to and improve. sales line

and questions, Our core to disclosure attempt narrow We if be follow-on Operator? transaction XXXX time that necessary. answer of core now EBITDA Operator one per and you results, the estimate for questions all leasing updated With to to appropriate $X.XX address we'll your you submit Please year-to-date our At and our will question possible. yourself I'd as as your make so ratio on is will core instructions debt try share current ask how our later I'll to this that due can between of we FFO to projections. FFO that give limit to to our public like to or activity many $X.XX. guidance X.Xx. adjust

Operator

Instructions] from first Thank Rogers you. Baird. is session. Dave Please, At a One poll our question time ahead. W. for please, conducting And be Robert go from this moment, we will question-and-answer we here questions. [Operator while

Dave Rodgers

those then you're and and you and you in can remarks in of I activity in about stack those to I of the Don, your up you today other your about could that guess start Houston and how activity guys. each reinvesting and your the Philadelphia reinvest made to build-to-suit in looks opportunities? of options acquisitions morning development seeing kind better, and you pipeline good relative and prepared some with sales and of in Yes, of development how in kind the would you think what talk comments acquisition how wanted tax terms the two but to much relative of -- terms incentives just

Don Miller

Dave. sure Yes, understood fully question, the I'm I not

Philadelphia at mentioned on sure we commented disposition I'm pipeline, not on that You a all.

Dave Rodgers

continue comment a if look the interested two assets over just different better you're opportunities what that's their obviously for exit it mentioned so, guess, other the of in pipeline, in maybe year ask kind on way, pipeline also there one the build-to-suit back guess, buyback, around the acquisition that's then out clear? acquisitions, you as your to work to but I'll at next to opportunity a is you more and I seeing proceeds that I or and of put those and fairly quickly, the kind I'm Brent, order to most development avenues, stock

Don Miller

would bit a with sort core whole strategic I that realized understand about handful Okay. have -- Well, non-core I also say thank talking asset some assets, in sales a of quite -- we have sales I their you. better, potential. be but that guess, asset would non-strategic obviously of been

a evaluating environment And that capital steady which accretive of the marketplace. a fairly target-rich said terms I about shares of to quarter little we'll a opportunity what to and us of into we've -- of have with for and do asset perspective. this to available did of and of Minneapolis we've yield we from assets We rate put proud acquisition quite it's tenants. a may the turn capital is. second in talked eight-year Half not bit think given do the their cap big so it's obviously, and got to in address Many that, over Having think of very redevelopment building. them but be here it. so we an Brent the access, or lower an pipeline in cost potentially bought a further, the the replacement the some buyback of was use I'll repositioning be ability with him particularly We're best deal let it acquisition a bit always we opportunities sale.

of returns. those those out kind list that aren't those about kinds long aren't a there excited opportunity, really there, at So but there out of of

So you add much to would that? Brent

Brent Smith

been product, acquisition in environment, opportunities continue and NAV admittedly, to to accretive in been product I lesser for limited is our we'd and the a scour in Dallas, Atlanta, deals Yes, strategic areas Dave, have and of find terms markets it that more still Minneapolis. -- we've earnings Boston, to like that but are we successfully there's although our able degree, to the like finding that find the pipeline to there and markets

We robust that's able into the as platform and in opportunities We're drive into I'd you're are and and So meaningful go again, what that. and asset a a is momentum seeing to more Excelsior, And mentioned are XX-cap the and which rest and buyers monetizing redeployed be we'll incremental assets our to hopeful but for example detail there continue to bit and I the redeploying but between of those of opportunities this quarter. we the we a with that value accretive and to to And for that that able did least the and Minneapolis value cost 'XX place of a acquisitions. We uncover we discounts asset. be 'XX low-five we'll looking create deal non-core assets basis can particularly of be think replacement transactions those to GAAP phenomenal think XXX into for shareholders. mature in do out at in look -- admittedly Don people maybe we at a then we're ways capitulation is into as a at be that and would the mindful the on quarter I will built say thing. more going as key have be as we that this around those is North been roughly little utilize think to there dispose hope, roughly. we've we've of mentioned that pipeline And able we sellers, Brand not as the opportunities cap examples following to think XXXX continue perfect we're

Don Miller

build-to-suit we of deals. development the still on Dave, and number fair are chasing side

some kind couple you, metrics the in in build-to-suit are now, so excited you buy the us we've people capital told on And yield, into for compressed things think cash we acquisition of six-and-a-half we kind or cash we when side to yields activity a As of just did it's lately. years that which we frankly it gotten seen able harder see seven doing for of redeployment be have Minneapolis. that chasing better yield about into the to even just range of down

are get we in things Orlando hope well. months. at Atlanta So imminent something over the But think anything to point going in some done next some don't announce. we XX there will we optimistic still is I say that as get And to

Dave Rodgers

the so, you maybe more Brent Jersey, see you I the could been as prospective of Great. on on Brent Brent, suggested. just of about, maybe in kind lot York been kind project the from Thanks State doing broader in know different And in very of that comment for I New things on Don, you specific sale involved New a if one of the talked actively a now comment how follow-up York that. the State. last across you New including succession years And kind of couple like you have focused and of terms planning renewal have organization maybe then,

Don Miller

Brent, first? to go want Sure.

Brent Smith

Yes.

not to for first have due noted calls, planning end deep is Regarding optimistic there space We the size regard. we executed -- be of at the that's really of given prior know obviously of I the can New we outcome unfortunately give feel lease with are then things been or you discussions, a And into very on next very at this year. do the around renewal is nothing into very well tenant. as we deep in It we on most are that quarter expire headed about in where renewal. will as that York Piedmont executed. that announced, as good point the this lease would State so the positive And we has still as economics the cautious. have have But well the both detail

Don Miller

on did really region a job while NAREIT to from yesterday, have accomplishments a otherwise. Dave, to and here. with recognition Brent back years could part. guys moved doing thrown and things decide interactions several Officer, us has did great Northeast but gotten thinking that, for XX lot and pulling awful He an obviously a Investment you now. joined like of his he promote the XXXX. that's obviously, Sandy got about ranging involved Chief with more a into of accomplish and debacle at broad And We in Hurricane on we as been Immediately, in lot I

the set have operational and most out to strategic of goals accomplished we have our with We -- the exception price. virtually all of do, the stock maybe

had ago. some like feel for so, the years right about maybe particularly that I few a with me thinking these to getting health start doing it's problems And time

that of that sort all yesterday. So, the we to made contributes of announcement

Dave Rodgers

Right. Thank you both.

Operator

Please ahead. from go JP Paolone question from next Morgan. Our Anthony is

Anthony Paolone

the promotion. Thanks to on Brent and congrats

this mentioned it. ended be just on just will you Enclave if deal? that Transocean and But I what and some Can may what the have to to you imagine out things up get is on just question have spend yield TIs First ultimate I what cost then working about missed talk be. to you Place. --

Don Miller

could because out that we of that think be would the from obviously Yes, longer we doing development. ended lease didn't economics than forma length we It took this it. we turned up way the the about have turned the Tony, out hoped affected lease we so much work I obviously in earlier to out that originally the it have same obviously the mentioned that and started that a lot would given we a of better pro have. time liked We

cash out As XX-year square had it. were lease foot But were themselves than overall. pro expected. below the term. of then bucks And Not you lease a But about And originally we and given the rents forma of with probably they will GAAP TIs. TIs it up in higher the growth were and average was still an year tenant, at free slightly the appreciate X% about the term ended X X% of the in rent we to be about a on per going producing we what came because those rents higher. yield or leases, the with about year a per originally in

funny, to took interesting looks or like leased. us a kind it's builder two except and of So, new get what it about three it today suite years

if on it So would that was several builder end the where for had is EBIT to a downside, be the suite building the came be the fact today. a out expenses it of the to there at we operating But day, years. about

the that, in the started were said for early than been development reason we that cost lower our they much cycle, today. have would having so Now is main

Anthony Paolone

it. Got

when the XX%? were another it's done III So somewhere million K, get about that the all was It $XX most to recent if from -- basically situated, up so and have base the said in like sounds I spend million. you $XX the schedule them

Don Miller

more Yes, maybe than a touch that.

Robert Bowers

five. Twenty

Don Miller

-- is About commissions. XX with at it over little

Anthony Paolone

this, then is is it sure got compared to on opportunity the lease, but And is even that market Okay, to Or, Great. it. at there? it Cargill in? yield the make going clear how want on under XX the so just

Don Miller

is lower is closer we a -- -- to building - could is sort deals next level used the that in is much feet here is will rent yet, is actually recall where hours different line variety about but but be XX XXX,XXX And and more it. there some talked information market larger is the feet. haven't other there entire building very today. The out be do about things. reasons that rent XXX,XXX a they for not of we building than in it we One lease that The tenant right because only occupy building. XX thing in lease. on actually about of the for the No, using didn't training today the The paying the

up So the longer income rent But current the there some there opportunity were if about for space rents we at lease stream today think asset the said term. in market build to current have is having is least to in the there that, vacant market are -- we the building.

Robert Bowers

If class, I may built one seat class in onsite what really AA are It's coffee our property. add in excited room. are the from a two miles amenities in asset, project It's it's The building. environment center, preeminent to that, really few campus existing this and shops, fitness just of phenomenal we Minneapolis. strategic, about really food service locker XX,XXX best café, foot a XXXX. auditorium, square It's XXX corporate

of As noted, income $XX is million from years, net Cargill five come to leased that now right rental to due there another for we lease.

create opportunity value the an we over the asset quality itself. really as So it view given to term of additional long

Anthony Paolone

some maybe the But it, missed joined buildings that the Enclave one I because to those may whole… okay. did apologies thought I like -- there have duration missed Was I two did sell? that I plan you And and Or two Got miss this late. you other? have then, were I of Place had

Don Miller

Philadelphia are -- the the market. that is in and Houston two two lease other projects. assets call what non-strategic asset left would One just term -- now the those what Tony, No, that is heard have we The the you two the is an we really buildings. of beauty have XX-year have averages I we may that partly, is

like over are not to course of we time. And so -- the with them although would we move them,

And any timing because will of and not much so proceeds like have those on we got assets. tax are and on implications we so that. hurry But we doing term lease based that in things be of use

Anthony Paolone

Right.

docket of So you being on Or that? would drive a as not, mention what would? kind be to of you those the in if about think net kind assets did XXXX, seller

Don Miller

Yes.

those think net that's I -- one I have -- actually But or seller forecast of know XXXX. to a did conditions. I we say of because both would this at of that I we may other in we we think assets say But for ahead that XXXX. hard actually always in point. we market think candidates think could them being the assets queue But be

Anthony Paolone

Okay, got much. you Thank very it.

Operator

next question is Instructions] from ahead. Lewis SunTrust. from go Michael [Operator Our Please

Michael Lewis

risk? maybe Could bit mean an that's risk. that that little makes a you than on talk you. that's utilizing is more that Thank and a downsize. What market, think you I footage in have a on the in it place extra there. that all more? would One want they that acquisitions, great. me Hi, Normally, a the Minnesota from square I at you look to tenant the like expiration I tenant sounds mentioned a you if mean think space is opportunity that rather

Don Miller

an a form. in pricing And So, current fact of very difficult on impaired based term that opportunity that asset the be single asset to building. would in that the lease its sense you certainly of five have like finance tenant years it's a on

are they the to able they buying to of an reason transaction. of space extension the move takes restructuring in could they that opportunity asset in. on are the the involve an basement. front-end. to painting we and are the think they lot buyer potentially moves forward Having maybe in It's different else suggesting said have term interested quickly them successful and are that it's in is someone cash the want take lease might a opportunities of space or part stay It's downsizing, we that, a now, for execute an as in So, the whether us basement right that if the we Cargill all

going way, not So lease. restructuring opportunities are at all. need you after we The space years in that, do leave there to scenario, obligated underwritten case And that don't, they that, have a if is lot Worst to idea is them. do they they by And that it they're you collect scenario. don't. just different news the the great. If probably we -- upside still to is if of we've from probably can of that the five that good as with rent some

Michael Lewis

high yield. certainly, going you; Got Okay. in

that as the if when you expiring you that if schedule is, far it in I to of on asset address the you like which market? maybe before looks and where you other feet wondering, the have square kind As -- is XXXX. sit, asset Philadelphia putting in Houston need comment that XXX,XXX on which was and just that expiration the at think this I could assets, the lease is category look

Don Miller

actually. Yes, confusion asset XXX sell still understandable other in that North is This in it November. we the brand Glendale the until category in is

a now so as is the otherwise, expiration result, until we… with that And lease portfolio that sale upon Nestle leaving completion XXXX of that's the

Michael Lewis

We actually about that. wondered

Don Miller

-- the Yes, roll those otherwise, no lease there's over Okay. two virtually in in other assets.

Michael Lewis

one guys then, is all? what me, I your acquiring last are there Orlando. competition in sounds like positioned advantage significant in the more they there of you that do anything, think redevelopment think buildings competitive Got planning you And at in kind doing Is I know the creates feel well really maybe if alters you of it there Orlando Cousin's market. that for you. just and wondering was

Don Miller

little will that same more as will well. so a and year to quality of assets We never good the keep the and we gap about they're want our assets, to coming in Obviously, rent. that location repositioning them, trying they and don't but marketplace. premier them bit that over cocky, are They market, critical buildings time same already talked the have that the think and nice as are at the we aspect sound at the reposition buildings to between the marketplace. closer and really up know We of same the that the the Finn going don't about going that us the level to be talking not will location. be to We've catch the of you we be extent [ph] got a but they are location SunTrust is you us our Corner to but they to the achieve ours,

well very is assets their located. of One

off are other little The a two the street. bit

Michael Lewis

Thank Okay. you.

Operator

ahead. John Our Please final Stifel. question comes Guinee go from from

John Guinee

Oh, Guinee here. great; John

question. mid-duration net? Brent rate probably the typical on First, But in XX-gap wheels, building $XX square a market. is the rental XX-cap car net, $XX Yes, the stream only for the to pretty foot the bucks I building Well that foot translates a California Southern a about a a Nestle like deserved, in lease congratulations. cap at XXX think

Brent Smith

no, and John. Yes

think they we but of Interestingly, they over the don't from when one been the down of we caught renewals before we time, market the the the talking you renewal last to about so right of they hit what rent so So it at with before but big year a did five that market recall when with lease the the it XXXX the struggling the bought of extend so far actually I not the was good and did and pretty renewal, right in it them language to Glendale for had very rents you Nestle time off. will I badly that series had an they window yes, about them. a building hit can their time they -- you just right and struggling it's sort or and are we tri-cities to do when that's last a was cycle while market probably -- time at roll entire so long option we math the it if favorable able effective right, hit course perfect were a they some get

John Guinee

a street okay. Wow, whether turnkey commission TI a word usually deal, building package a state accurate base the then XX is bad or upgrades is really good broad way a it's or you a rate that rental is Great government you function attain, look the an of and at sort city leases with the deal whether it's on to leasing a can are a it's of dealing those? what when that and

Brent Smith

to their very different much John. state out city this are you appropriately. a The state in pointed Brent, is turnkey approach. in And negotiation. we This the price user as are so and Their and that want in you

will So as landlords amount actually committed dollar the to different cover to rate prefer get lowest and much that. to city possible. approach remainder get I they the that, don't takes too they above of in goal have then set is into their would And TI. detail The the want really

XX-year So dollars the you've in XX-year the plays is for how got term likely approach term a but but TI tenants, of the a the at again, great city. building and all do they the economics, with least both be different those that news state the of lease. they into put into view take base a terms that they There with will

a any you've be cash have GAAP the got that will and be but to and slightly a base economics those will flat the the within to bumps meaningful lot basis, be meaningful a costs of And down period I'd on roughly as they for ability So a tenant a both in also those got, cash rollup point state you've the city over well. will at will meaningful roll-up both the building regards to out lease time. meaningful amortize of of of

is you there growth providing flow those York admittedly, nice be we an and market So to cash elevated in that's New but TIs. going market are will and for TI rate be

John Guinee

with the cash slight big cash with city? a roll-down state the and So, rollup

Brent Smith

anticipate we for with to market building out, kind city those but still rate that. that it's is a in or that's floors with tell, and-a-half current so what a early above $XX a of certainly almost foot XX And year meaningfully very a obviously

John Guinee

you. Got

Okay, wonderful. Congratulate. Thanks.

Brent Smith

building net there, Nestle the rent of be specifically, net-net, Brand to more out North today coming is John, about the specific. next just $XX

John Guinee

Wow.

Brent Smith

probably hiring some higher Nestle building. into blend the of a rent with was that deals lease So

John Guinee

per world. low pound that of very price for the part Yes,

Brent Smith

Angeles Glendale Well, not for for. for Los but necessarily,

John Guinee

you. Thank Great. Yes.

Brent Smith

you. Thank

Operator

Thank I'd any concludes you. the Miller, to back Mr. the turn session. closing to comments. This floor like for question-and-answer

Don Miller

Matt. you, Thank

to forward quarter to We more a seeing be relay such what's are NAREIT. week. into looking we everyone had next able this happened about since quarter, going excited good at we are Obviously, NAREIT to

cancellation or a two on schedule. our had have We

we to have together fit wouldn't you one with but we have two get if availabilities Eddie Normally will an in. give us, this at desire appointment, a or you pop-up. So a have point, call, he might

we'll interested, calendar. get the So and you you if a Thank Guilbert on you give are much. call, very Eddie

Operator

teleconference. today's concludes This

this lines may at time. your for Thank you participation. your disconnect You

Don Miller	CEO
Robert Bowers	CFO
Brent Smith	EVP and Chief Investment Officer, Northeast Region
Robert Wiberg	EVP, Mid-Atlantic Region, Head of Development
Dave Rogers	Robert W. Baird
Anthony Paolone	JP Morgan
Michael Lewis	SunTrust
John Guinee	Stifel Nicolaus

Piedmont Office Realty Trust (PDM) 31 Oct 182018 Q3 Earnings call transcript