CXP - Earnings call transcript Q3 2019 | Columbia Property Trust, Inc.

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Operator

Good afternoon and welcome to the Columbia Property Trust Third Quarter 2019 Conference Call. [Operator Instructions] Please note that this event is being recorded. I would now like to turn the call over to Matt Stover, Director of Investor Relations. Please go ahead, sir.

Matt Stover

Thank you. welcome Conference Third Call. and Property XXXX everyone, Investor Trust afternoon, to Quarter our Columbia Good

Executive Chief On Nelson of Chief Fleming, Mills, call our President President the with and Executive me senior management Officer; other Officer; and Financial today team. are Vice members and Jim

filed supplemental Form file investor this XX-Q this time results XX-K. in of of relations audio our Our quarterly the our released X-K. cause anticipated, our actual are with be operating events this can forward-looking discussed expected tomorrow. website an statements available afternoon, this which were materially of XXXX on including the call by Form section on results SEC and found We those our and to SEC factors regarding And could the differ and and package, Statements from number on on call be involve with those will the Risk afternoon. of and A future today's results section other risks Factors made uncertainties. replay

conference any beliefs; discussed made undertakes are and expectations, no assumptions time. available well to at as our information obligation update current statements based to this Columbia on on us Forward-looking call. as this information

certain During found financial Reconciliations measures this in data. non-GAAP can our also call, we to will discuss be measures. financial comparable GAAP supplemental financial

Nelson over Mills. I that, to the turn With call will

Nelson Mills

team. reported the strategy, another entire our everyone, Welcome, our Matt. hard and of work from and thank afternoon, you results you, portfolio of we us. quarter, Thank success quality joining reflecting for strong the of the our the This

attractive, in within of the portfolios entire the one most created to office modernized gateway high sector. entry barrier best-positioned have neighborhoods markets. We feature some We desirable the located properties in of

our taken also for shareholders. to We enhance value steps ability key to create our have strategic

require to Today's rental attractive these increases continued companies ideally high functional most experience structural and qualities. and They dynamic evidenced by rates. inspire and retain attract, as with strong and in workforce. occupancy forward-looking properties a demand, features are to Our substantial located, energetic

this in we the of quarter of You and after can quality same-store tenant results evidence roster our see in continue to quarter. generate the

maintain we to selection approach proactive and investment Columbia, a disciplined leasing. capital At very but allocation,

further but looking it's operating strengthen in generate you full to on and ahead platform, action on operating for approach, with focus are display walk portfolio asset while a over opportunities and of these flow growing the like has most our and Jim to we to been our discuss key always and we decisive the will years, improve through several first, shortly, disciplined our clearly a decisions our visible This opportunities. We take and our value. And to results recent I'd which last capture financial opportunities. maintain highlight net strategy growth cash tenets

our creation Our X primary have investment measured as we excellence. shareholders and and operational by in for value key disciplined management goal and cash growth, capital flow is NAV drivers:

to has strategy thoughtfully been capital better and investment growth over time Our recycle opportunities. to

exit maximize more and to of diligently very capital after some the into competitive been along way. has the disposed with value redeployed than $X submarkets noncore of most demand repositioning of assets in We billion have supply tight strong the markets and them That country. select

submarkets to pay those more within the for continue properties choices off and right the we made Choosing shareholders. have is even important, our

portfolio development opportunities. One at sales And sale Francisco with million exciting XXX we into including York, our ground-up growth now that New Lindbergh $XXX Atlanta Glenlake completed net the within the can property high-quality mix our multiple in Three strong One of names new the assets nearly strategy. opportunity selling These with new sales earlier generated blue legacy located tenants, of have now not and market our deploy after well-established know, This did Atlanta exit combined have of this now San a interest we year, and you Washington, chip Broadway. XX% of and is Center. of positioned growth attracting As fit D.C. is The from us proceeds such our opportunities.

As a Park, Union of next is location located transportation York's to ideal an reminder, live-work-play Broadway to one XXX adjacent active New most Square hubs.

We is this substantial before attractive design at completed. location prime attractive that very efficient are confident rates construction and building's leasing command well and will

very XXX Tribeca. has heart supply. of at residential addition, one located contract high-end This office an is modern In neighborhoods, that redevelopment under we're in of property exciting in a submarket also on Manhattan's Church the limited project Street attractive most

to vision at Church tenants interest impressive office Broadway, XXX rental will XXX like that, Our space strong is from rates. top boutique for create desirable highly attract

leased being and XX% continue to value we the opportunities find to today, flows cash across portfolio. Despite grow unlock

the Our XXX quarter at Suisse making highly quarter, XXX include our West Credit quarter third talented of leased XXth Tech XXX,XXX Chelsea feet almost during it signed renewals Pasadena. and and California, this in leases Street productive motivated square the during year. Notable team in at most leasing Tetra

we highest in cash on As re-leasing a basis. GAAP and Jim spreads of our a will moment, also both a generated year rate discuss the

While our overemphasize much has and portfolio attention repositioning tremendous over the can't few drawn success. our last transaction years, the of activity we leasing

in than rollup our average rents. leased years, X million more markets in square XX% we core at an past the feet Over X have

to step Finally, a I Columbia. strategic for key highlight want

be by expected of at pipeline in which The D.C. $XX.XX year-end, to Real per $XXX As to capabilities, enhance New relationships and complementary significantly shares entered Boston. announced integration are close into this will agreement The with share. opportunities week, last valued York, is and of CXP will we Estate to funded largely Management. acquisition, Columbia's platform Normandy an million acquire very have excited

will G&A. to revenue capture minimal substantial that should Within corporate the Columbia impact accretive modestly acquisition, with be on our streams FFO,

already X Street. XXX team. XXXX, and hand-in-hand Normandy with a is projects, and a we're working leading XXX in forces them natural estate respect Founded Church And and operationally on both with culturally. development Joining Broadway operator is to real with fit Normandy management development

We're these The an us we together access accomplished of will very potential. Investment of and senior well teams, as the Gavin expanded our and join Normandy our our Finn execution capital, to and a long-term welcome platform, establish who Evans Gronning, team. enhance X Teti, deeper Wentworth, Officer; competitive brings greater Chief also team bringing to within and Columbia, talented force growth will will Board acquisition including our to expect to who strengths Jeff D.C. Directors; leadership pleased which all and New York Now join our who become as markets. Paul

quarter financial and has Columbia another impressive results. operational just of summary. produced In

value-add back hard core our value to our growth team. further positioning pipeline the have history we'll drivers to We creation add of have prospects. drive work course, we've projects that the embedded growth And through broadest in talented unique platform our and a new capable our existing our properties, to in of strategic of It soon our success: comes our of for and, shareholders. the investment accomplished the all most strategy

more We shareholder continue of look to repurchase shares. opportunities even potential including our you our I discounted to the enhance progress. forward own value, updated keep seek on to

the results detail updated With to for call year. our to to that, our and now Jim over outlook I share on provide the additional will turn

Jim Fleming

year; and per strong everyone a and in cash to us XXX,XXX growth And appreciate including a feet couple we our basis. full produced X% Nelson. of Again a and our year quarter, the and on today. to Despite the at same-store be a for putting XX% able during XXX third of the continues at Thanks, share, basis leases in year of for the we limited rollover, this quarter, New XXth XX% highest Street joining meet very expectation lease XX%. normalized high X.X%, XXXX spreads, Columbia. vacancy in level York low San square we right to NOI our $X.XX saw XXX California And West quarter, team leasing call in FFO of was line key on Francisco. Street GAAP to

As achieving NOI key and growth renewal higher on rates of future in driver is FFO. you replacement both and a know, leases rental

the sheet further Lindbergh strong and has Center. balance benefited last month remains Our of from sale

is EBITDA XX, As X.Xx, at down X.Xx which from March. of X.Xx had debt-to-adjusted in June in September we and net

from small have real except net And have XXXX, XX% XXX March. we until Broadway, debt-to-gross to XX% improved June unencumbered $X billion Our a on more maturities assets XX%, than and we down loan in debt in estate construction properties. no for and also of

to substantial strength as move with strategy. capital our gives deploy us financial we Our ahead

We continue seek to and key projects in our will attractive redevelopment value-add markets. development

shares, In we which we ability addition, a own compelling as been now see announced has that repurchase the Normandy value. to our have publicly, transaction the

options always You active August newly all repurchased the our in can that in into at us more this acting . to put regard, against effect investment and balancing opportunistically authorization hand utilizing but was expect be

to updated our outlook XXXX. for Turning

originally the range anticipated for financial the are Lindbergh. anticipated" sale to again of continued and FFO We than strong performance our raising once normalized due "later

original range raised was the second raising the $X.XX first the Our we quarter. range year are today, full and after we to from which again $X.XX quarter again $X.XX, And after including to X% guidance of $X.XX, XX% XX%. growth rest leased NOI $X.XX to unchanged, cash up to year-end same-store The remain XX% to of estimates percentage $X.XX. to our and of

we're results. continues our for Columbia, third be pleased In summary. year with to a quarter and strong XXXX

result about excited high metrics which again acquisition in will XXXX recent XXXX NOI be provide to FFO We but our achieve XXXX Nelson ranges accretive upcoming solid on in cash our despite we to noncore of for our per and modestly next same-store our the and other dispositions. this can believe share. We're guidance normalized digits, we we as also explained, FFO call, transaction will continue will growth expect single Normandy, FFO

will disciplined believe platform. record, combination this However, capabilities be we relationships real as move value creation while year, opportunities larger we underwriting. And we next come of platform focused find maintaining into to the the and on from forward balance value and sheet from track our strong a will leveraging the

be and take your I Nelson that, With questions. would pleased now to

Operator

comes line Kim from with Instructions] Capital John of Your Markets. first the [Operator question BMO

John Kim

an where may that provide the it's could as occupancy quarter, soon I'm you a I Madison. probably still does but XXX WeWork, in stands last you with today? that's update And this situation if if project wondering call and start as Wondering that I tough the think on know mentioned case.

Nelson Mills

for John, the Yes. thanks question.

space and yes, country, case commenced. So that is summer, all with XX,XXX utilized and next occupancy feet about building news X They're WeWork would the is process we we're well Cash the space. have the along WeWork are highly told the believed build-out by, It's, a space. will locations the think that building a Madison, the that's all a are situations, as those the will subsidiaries in originally of each the with be ready lease whether in all process. in California. flow changes, in of under Both construction, They around occupy reminder, be the of months. On out just WeWork D.C. WeWork. clear under and likely in XXX in We monitoring working with We X case. of few we're June. actively. this begins entirely not has quick that do

are speaking stacked up. in confident told,we're some very are companies WeWork, with they at their are their either that ability We new and tenants. told have of space plenty that with they senior And or occupy the demand people enterprise we to of

what doing work. what that's told. That's So they're we're the being

no to keeping occupancy on believe we're eye have a there, that we have We full it. reason but won't close

John Kim

with with C, is plan existing Is your relationship that a status the given you're your to plan just there keep preference actively even Or considering? B, them? quo

Nelson Mills

credit I would If that under think right confident space, where terms. deal legal that's not our good be property, a great is. a confident were is. and being, what very reason, focus good Well, they'll building, paying a We've attracted the fine, If as think. We're struck And of outcome. building ability a demand. fault, good South in first the with which got property. desire it. any we work the we have they struck to XX-year time it's alternative They're good And place. good options be very that first Midtown They're their lease, for great enhancement and and continue but the for some the we've long the why to they're rate. and our a the It's an the us we current changes the would tenant in discussed they high We have out past in we're way, to property. the that then as all, use just for is either it's that, tenant. They're in it investors

John Kim

Okay.

to the you to discuss you're prepared Will switching assets business, know you Just to private what I that including looking equity can can will Coast? it more under it Can Coast, bit about you well, to you're East on as how far sourcing funds the they be they in Normandy. as a plan discuss, transactions kind talked grow management the but or you And on remarks, other little of looking looking be the side, as truly the acquire? kind be markets your at of West raise?

Nelson Mills

Yes.

has and the and they Normandy's York, Funds quite have business So things focus there. they good there, Boston have a are New D.C., active. been reputation Northeast are currently funds. X good And IV Corridor. of lot At the core and Funds III their a going on of

has several acquiring They are funds. GP the interests years years, each have We run. in those several to

have Those also funds pay well. as other longer-lived the those investors well. and in income And we'll, will and collect at those for look, projects project funds. the managing direct various fees obviously as are manager; so, which those level, invest streams as investors fees And in we step

very In management. a has very X peak fees, companies that. fees. is third-party so are addition And And successful We're Really we're that story, to leasing have about their in. developed. various business property and at stepping together. that, healthy, There management, vibrant Normandy we're they there it's a property merging very development it's excited

and All Most we we durable. together quite has, the reputation the forward our reason, forever. mentioned, the the streams to those of the Jim the are together. real and ability income not create platform and merger as this them just And value team will last what renew but go decide continue, for and our talent, real reason of to complement was company may the

Sources capital to debt point project-level It include raise opportunities be, decide remains at will to fund. of and equity as some those do we'll whether arise. another

take we doing could to direct those new care we'll, new Funds we'll then various or of and certainly That's there, certainly great And have be, project-by-project together. and with are play we're III raising possibility, and out. for going hopefully, have, go And projects financing. to a investors options the we going from capital IV

the was how looking So started not, together. Normandy really We, yes, could a to We're great sell their again, It partners on excited fit. not about company. very this we was together conclusion the more opportunity, as we of do putting us. together, few ago, the align that And months answer how the to best X a strategically companies. both can came companies the we was for discussion

So necessarily single. to this not we is that's point. got how That

still We're We're discipline have We directing going before, those dive shareholders team to looking efforts. a into Columbia at had bunch new management of but or headlong development projects. do the same an you've all the active opportunities, got that pipeline.

now think that's or So more, on be broader capital. we'll it. more do access it, but relationships, our weapons, have elevates disciplined really to and reason just we We to about more tools, it thoughtful and fronts, to continue many game the

John Kim

type looking of to do this value-add core-plus to redevelopments... your looking does more how Are you So acquisitions? stands? as more pipeline Are still impact do acquisition it you

Nelson Mills

Yes.

X actually or a looking We the to relatively of projects value-add do know, relatively at portfolio in X, the with that last projects. potential We overall certainly, those we've Normandy and of year are as development both Normandy. launched couple will we're projects you have with small

the D.C. have eye We Francisco we're market. in at, New assets also keep and San that looking on both D.C. some We York core, an core-plus even and

are risk we a of the probably and So shareholder at the on significantly more in more do more portion the plan add. no. are, our XX% can not at-risk, do expand at-risk more leased would dollars time, percentage portfolio. we At on value successful that the any investments. opportunistic cap XX% be to point our to we The of We our

Operator

comes Morgan Vikram next line from the question Your Malhotra Stanley. with of

Vikram Malhotra

clarify Can deferred? paid an Just maybe now on million? the on another how there's based that you the new Normandy. component question not, versus break up And or more metrics? what's between Could you structured payment the is if if what's $XXX just payment earnout into

Jim Fleming

was That's and the was and structured. a of the we this lot question, it was thought good Vikram, something gave that is Jim. part way deal very of a

everybody are This units. $XX.X million, these paid shares essentially They're same the that put closing. is to that's just the So $XX.XX. LP And at million $XX.X page. at other cash on is, $XXX of million

back Normandy shared, the X/X over way, the X-year team went with into going of and is X this upfront. that to are some of investor, we the that and idea X/X plus really to us. be And there into tie-in this where of other a and all other went held period. are it And vest the that be roughly is to that's Normandy. key vested with there should away, And original principals, wouldn't in for that The, come by right some members work vest one

been Normandy them some in is of have then who really them that with tie principals. Normandy to the to And former folks to going So X/X of align goes rest employees and shareholders.

substantial there's to was at and purpose. it for continuing that to So us, forward way tied a structured that's work going stake amount on

Nelson Mills

to that, And add to just yes.

Just to that, add to Vikram.

rest to their team mentioned, tied Jim employees tied vest join key senior these they're and is. of our over purchase portion are performance team, to our of retention just to as coming And price there compensated shareholders of the is our compensation like of years. that is Much over, management end, tied being in for, senior key will to is then senior As several can also important the of shares, employees. a

and a think built retention features there's alignment in. we lot of those So and all

Vikram Malhotra

given just of the versus relative separate of view NAV? your the here. of about you're to you on is us sort just buybacks stock way on question update then acquisitions buybacks And Can just thinking sort how the

Jim Fleming

in The is have it buying reason, so The this might, it really be couldn't some back a might, problem everyone we discuss. reason lawyers time. pending. shares to thought just, especially was which be Vikram. for had bought pending; not clear: transaction We just that we we Sure, shares with transaction and this we We, thought our us

to shares. new announced, It's so behind We authorization that's be forward we'll buy Now million renew August. and us. the free going in $XXX been did our with

we really we and shares NAV past. to price is versus bit have at the think a is that. company. even in the higher our do, do to reason The price we and we are And of it's level this free So compelling go this intrinsic value bought

to we business doing should And keep add value and expect do, we value strategic it's see so out to the out share really going and can there's I you clear think do we to we lay so and the clearly, able it And value, in going very we a be be we're where forward. the going of think there's want I, see stock value in value. it in us able some a that but market add repurchases. we're lot opportunistic, to get lay but some to not I'm wouldn't to now

Operator

of Your next McGrath Evercore. with line question from Sheila comes the

Sheila McGrath

wondering arrived how you of valuation was you $XXX at about Normandy, I how Nelson, you us also the help Yes. thought if share the $XX.XX could understand million and price.

Nelson Mills

our their mentioned exit. so earlier, cash you We can flow price, as various have heavily wasn't was bankers. at to sell have bankers. the They streams I yes. and mentioned Sheila, really I earlier streams, And Normandy a looking flow looked negotiated cash we it imagine.

durable than others. some mentioned more are I So

higher rate Some would cap than multiple others. a have

And so, price. negotiated it was a

We streams great very could There It's beyond as paid It's a with advisers we And on streams. fair with something were there's we the owners beginning largely from Our but the intangible of flow it talented But valuations feel companies. and us. very and multiple to team. very a other value add we there that. negotiated, was you on for looked multiple enterprise a did. valuation a management and cash that, Board are the fit Obviously, we those. like of of quality deal, multiples based from reasons Normandy bankers, obviously comparable but was to multiples lot again, at our with cash a that streams. involved flow but pleased

when So was shareholders, to we're several good investment. for going doing we're value process. heavily confident were we months that seriously And we that take very it negotiated got but our over

Sheila McGrath

offset on minimal incremental the G&A in G&A. the, streams fee said Great. mean impact Okay. you then comments, from there Do that your you incremental but this more that G&A. And is transaction, to than

Nelson Mills

more some right. have forth, a companies That's X there. of mean synergies trying very and so the similarities XXX operations together, were there were both over lot so people. terms efficient months had several you're platform. We and little putting conscious people. we platform And bit again and efficient in together and and companies a get putting and several XXX had that redundancies to eliminated They I and of X of on were of about planning, than sides, that positions structure so an structure to there

management, on were there putting some So income fund tied were people we're directly property X companies management. together. the that real of the bringing streams, there on, savings lot a projects, costs bringing incremental on And then development to are

the And to affect and are G&A. really allocated the don't so those corporate projects

we'll allocations, for give on increase to to doing reporting year think, straight-up very modest. modest the in which this will latest, G&A, provide very standard today. the going at we The later is next what guidance details more but incremental year only corporate be the or So we're just be

Sheila McGrath

wondering Okay. Great. level at And the XXX give us on update Broadway. could if an I you interest was

effort and is think marketing going. I that'll wondering how that next be year sometime just completed

Nelson Mills

expect side. the well, on quite tenant prospect And this of do a deliver that's to side late lot next on at interest year. that We property going point the

very of confident by rate terms going encouraged on choices meeting have in activity. there expectations we're good-quality of and and conversations very yet, the have on is we're or lot Still And a and, the anything not we're of offers our having level entertained not, These in it's of portions a substantial return. we're are the of to but who verge around just building. choose, nothing couple of tenants. inking we, already We of high-profile the on just we

something announce I but it's have confident we're a too-distant bit future. a know So not we'll in vague, to

Sheila McGrath

assuming for us you million Okay. $X understand did by from that, the that? to quarter. And amount costs, G&A decline sequentially help separate. did related in Jim quick on G&A more. just but Could Normandy that the I'm one one is or I million-some see $X away you

Jim Fleming

us the companies Sure, lumpy. most little Sheila. be probably G&A tends to and for It's a bit

We that stock but second have of one quarter. quarter. gets be director that grants higher various quarter are getting expectation in that, the course, would And just third there things. I'm cause the then than to third the weeds, in any into forfeited the

swings it a So little around bit.

see So up feel down We unusual but our it's on we're that. to to I'd this. I little a will not bump it about range. very meet track and bit quarter-to-quarter, good say say

In believe. end fact, the the we low towards of we're range, pushing

control. is that feel we G&A under So

Operator

Germain next the from [Operator Instructions] Your of with JMP comes Mitch question line Securities.

Mitch Germain

I again mention did is you market? Nelson, Boston hear a Is target that...

Nelson Mills

Yes.

Mitch Germain

far. little activity, And about feel you a it's assumption more tough, that so Obviously there? deal been is that constructive is growing so maybe that, or an pretty

Nelson Mills

the yes. Yes, about know for Boston Mitch. I Thanks schizophrenic sometimes. a in. out. We're bit question, We're we sound

a, As in property, own there, there we Boston. at great property we've a as mentioned, you you XXX Huntington owned a a property, well-performing know,

considered San it like as much we on and very tight, fourth team kept years. Manhattan Francisco We a there opportunities It's today. actually a there, competitive the We've potential always a and more we've the liked Boston. market, have have, we We've but Francisco, not have market. Boston. on a San eye We over close built focus always do

history So tough. history, but given to it's there, we're track record, more our to. market competitive, and It's interest going a given relationships pay it's there, Normandy's attention

going actively imminent this there's I the but nothing get there. a think serious So about. more market is we're no, There's there's pipeline, nothing in to

Mitch Germain

then mean talking over like pretty you're of as deals a stock. years, stock it we've seems maybe in A, pipeline? And felt levels well. past because does buying serious towards a seen say deal couple about back but getting seen maybe serious a bit the change of had Or about these that the reluctance here we, you about to what buybacks? possibly before, the a Boston, about we've about why b, little getting, I you're Okay. you've more bit posture constructive acquire getting

Jim Fleming

Sure, so the the the why, really to into we go Mitch. and haven't has been kept got we've are pretty We That's market. free haven't this reason And just market. been the now of transaction. but sheet. to It's we able And pending it's been in market. good us meanwhile, explain been announced, a out balance

We sold debts And frame. stock properties the to And this can think see, have XX%. Atlanta big at two what a during trading worth. our it's, is noncore discount below time as and stand our you we it's

So there is it's address think value there, our job go to that. and I

other value of job capture is where Now value value capital-intensive can. to we we're be to we part and got we go may mind create strategically our to keep able estate. with in think where create real And situations I in a business, but

Nelson Mills

just Yes. to Mitch, And reiterate.

out. our shares are we buybacks use of, at we the shareholder value. thought quarters, a that reflective to material-enough substantially understand development any share this stay two a was had book this material, last in related way is was obviously transaction It wasn't the great of We entirely Over dollars. It's lack trading this. of to

going We we an said, see have Jim we'll aren't do and other stance to it balance As forward. but different a you'll to, do with a different, issue, opportunities. other see have scale factors

Mitch Germain

you have consider you're funds. seems Last how It of specific a like really getting, sounds may level like one you're leverage don't And you about, plan of but me. as a seems what Normandy transaction. talent acquire-to-hire interpreted as the I, like from organization. about to it it type more a of a suggesting kind from I like you

investments account little a the investment finalize community uncertainty, work more one expect separate as couple seems clearer You forward? plan over dislike of course so consider should months may transaction, think of you together we of next going mean of the to the as, you the I a to things of how is I intend

Nelson Mills

to Mitch: plan. Yes, is capital, Raising absolutely in clear, capital, private absolutely. be And

performance on fair with addition they’re under of, we and We and fund We Blackstone, side, have there. to we reputation excellent private that. in will this management Plus, They organization have want our managers, a Allianz powerhouse of so managers. to use investment capital Normandy, agnostic being that. great use grew also absolutely amount

The capital things club question are will that or around. whether just the basis. project-by-project a fund clarity Those or or private we'll provide it more be is a

getting the We're platform. to One we're that, opportunities ourselves the talking their Normandy things educate consents we're couple We're are and a extend doing future introducing we'll going to investors those further actually them. of to of of on us existing it's ourselves the months is relationships for the to investments. process to doing, what reason close, transaction. In to take the those

have our there own relationships, will we be relationships. And and new

absolutely, of that and we they've beyond major but and created. So to a have plan and it cumulation further yes, grow is renew do we that driver, a business a great talent, develop is this

possibly absolutely. totally about So together. as on to next come understand. understand uncertainty, later in deal XXXX this going before point to We yes, story something that than we and your We the that months. we're no pull but on More guidance couple and our the we this is get closed focus

Operator

from comes the question Lewis SunTrust. line with Your of next Michael

Michael Lewis

you when find costs, what the expect transaction detail. maybe of be, closes? And like you or us that, a deal additional out able but should what can to that $X.X that assume you tell share was Are give we more related, that might Normandy to then costs Sheila, million could little

Jim Fleming

$X.X Normandy. exact it, Yes, And Hey, bankruptcies, there it it's and be be, don't substantial will I though, it's think and number we Michael. of that more. a piece an lawyers have million. yet, it'll but is And

Nelson Mills

on about mentioned, more then longer near more close both good forward. we details the result near-term to the and we're modestly, transaction when there But growth the as impact that, accretive, term transaction we are announce come the and the that and on it's details Michael, excited about. term, then and More from come soon. something a very going We're opportunities to -- on we

Jim Fleming

Yes.

Michael Lewis

property these but anything fees management, Fair even those, development. say sense Maybe Okay. fee is more the you enough. versus investment are of there leasing, streams? not you're And versus quantifying could versus how much then maybe about a management of

at Just on a taking kind kind of you're of X. day here sense what of

Nelson Mills

other construction and Yes, management, leasing, prepared stratification as Well, future development, are platform, the aren't long-term I face, management And like from Michael, fees, durable fees, fund say significant. renewable of given Funds management details will to investment on provide the the business. asset quite they III on the funds, are management their the they're The I at relationships, term and the not are quite property opportunities core and so the funds. those. fees those we're as on not guess IV X while forth. long substantial

a So we rents we're as for also paying understand long same property. they're the as not properties, and durable did term multiple when pay on that we but not

all was taken to that account. So

in more we'll day We back but break So months. what sources we're yes, information to look hearing to X not what a that like provide of question that down of we in we and the forward on terms can revenues activities. earlier, what expect and couple only going Mitch's expect of platform

Jim Fleming

I or not got $X this. wouldn't billion know Michael, think, stretch. of have the business. our I more And curious. we're everybody to by is real bulk any business you of million to And $XXX is switching the in so estate, revenues this. our we in expect mean I to going fee this bulk a do really us of We're not And

that really does precisely for guidance a us are do what been accretive. is there forward, most course do relevant think I in provide position some modestly of year. except it's what's but yet to to for that it's say costs, as enough it significant So haven't the, that provide too personnel We we'll just accretive, more but clarity and we going next on

be it, stream, will we personnel the believe, fee really than substantially more the platform. think we costs. And we the So enhanced

So doing that, it. those are last really, motivation the mean one that for is I really

felt to relationships to bankers we the be felt of capital. it's were to track based again, investment fit by we and and was expecting big that the private. paid we stretch. streams do of our our and acquisition, done that record the to that it's, on that talent expand so get fee and transactions within the market, public the other the it the access course, platform and have the and So both part way okay And needed motivation feel any but in price that portfolio a about what that not And been was the for

Nelson Mills

accretive, when per basis. Michael, share modestly a And accretive, say we it's on that's

Jim Fleming

Yes.

Nelson Mills

transaction. So with in more the shares we are issuing connection a few

So it's producing enough shares. net net overall accretive, income be to cover that, those shares and modestly, all again to

it's of near-term short-, kind outcome. it's So a good

and this worlds. for best the term include hiring doing costs no just organically, As talent that revenues, both and going the but and out near would assembling which primary is but of is transaction, we've this the unlike reason said, not

great You a with the viable, renewable, talent. here, also business get a business real extendable

operational know So it's well. fit with group a cultural already on and we unique, a that that, very think the top very of we

those a all better to one. you reasons, than transactions, mergers much I for but are more mean, this know, logical, imagine that always fit it's these was difficult, these as hard So one

Michael Lewis

Got question. a NAV saying I to cap they're on these or a right aren't it. have the real pushed long been rate rates discounts by to wanted It's York just right. ask And not aren't lastly, then that the New investors or cap now NAVs time back

but You have any still do you kind the see Or pushback? private bought to so how really and movement public the of shares you past, market wide between I have assume respond difference of that rates? in a seen valuations, back you cap in kind

Nelson Mills

it renovated newly a estate, or real market opportunity, things capital a a competing there new product, pricing a And that weekly next New for like there has quality aggressively lot world basis product, that active. third York all. from is, estate. on. at a notes The both out we all We're no and the right out there's even very for renovated we're bit evidence round over on there bifurcated we Michael, chasing And product is of second vintage in go don't have is office that still now. real on of cooled elsewhere

a commodity well. trading as not our say quite Some up That'd in as view, from a is is view, product York cap I'd overall New interest. our to well in buyer's, properties. well from point of, quality appear And view. rates of maybe potential But the not, as seller. commodity buyer's more locations, standard particularly Or a holding and quality that's there's and for of much location be not be

Operator

of the Sheila McGrath next Evercore. with from Your question comes line

Sheila McGrath

Yes. in A we be follow-up. termination should Any that quick moveouts aware any known quarter? of? the And fees there were lease

Jim Fleming

Sheila, And to material but no, weren't fees. anticipating. we're not any there any there's there material that lease weren't I outs X, move termination any got to absolutely sure make ones. are there go material look

the floors course, rollover lease key a is are tenant mentioned our there. to The almost but another our Of was this in forward. Street building. limited and Red of, with we've of There very referred leases one both got XXth in Nelson top X going that couple we I Bull,

got we’ve very and substantial got think rollup. that renewed I that it's [indiscernible] through space

we Credit XXX it's did we floors space leased. lease rollup Our in at on was that back had And space very be substantial Suisse the also California, will X that renewed, at get a big floors that as get top to wish and but rollup. X We California we building. XXX more again

that. concerned pretty are we about not And I don't, So tight don't, now. we right we're

Nelson Mills

have tenant place. and vacate. Sheila, is a we space of considering no couple a That need we a where situations tenant in have longer a much move that or do

good to left, tenants this good interest there's However, space. plenty come from of has rents. is, at the tenant The for rollups other the tenant but credit. is There's take term and lease

have, those. So of that months. some next those be report the news may There to we opportunities great advantage could and couple on are take

news. the be it's story but of good it won't needle move That'll good the a It's, just reaffirming attractiveness space. again the overall,

around leased, have the activity, to do we portfolio some that it's can upside a XX.X% find advantage you're but take when whole we of. difficult of So lot and of that

Sheila McGrath

just significant. I'm Just spreads on Okay. property? is us that, can quarter. this, if sorry driving They a one were the the detail spreads. tell us whether you just missed the in Great. give on I little And leasing specifically or but

Jim Fleming

there two, XXX was Street mentioned, Those other that XXth two around drivers. They and was each York lease. significant one so I a, and that XX,XXX were were then XX,XXX, California, the there feet, big Sheila, New in

Nelson Mills

It's Tetra Tech.

Jim Fleming

Tech. That Tetra was

property. at three the have Pasadena leases we So

was, were leasing the those between And of the that So that quarter. over was those, the those half three of in three. the done were

Operator

Your John line from next Markets. BMO Capital question of Kim with comes the

John Kim

follow-up. a Just

Just just been a a recent on it's transaction. follow-up Normandy because

this earnings And it forward? your what not growth wondering, growth NAV-accretive it's accelerate far year, next going So does having it's accretive do, but as deal. Does platform modestly an was earnings as I profile?

Nelson Mills

absolutely, Yes, I think, right.

that. as we've party, know, fees. you're very partnerships not Whether So, transaction, with Normandy. when just a this excited you And very activity with we've doing, partnering development about that some already excited about paying look we're you're or at, but through we're third done opportunity,

promote. You're paying

You're sharing profits.

other to do point view, that's And house so that just the that generate to fee from ways addition that, to streams, in of other to have capabilities fees, construction that, management capital.

competitive partners but the opportunities; compelling opportunities importantly, So to and us to to chance I that great investors Invesco attract be it addition the winning and Normandy's, does and who ability more Texas us. some investors Charlsters be it of for and pay us, those partners, I profitable for likes think make attract that Teachers opportunity to alongside, in of They make the more profitable. at does to ability think to will fees. the more more It have promote, gives the also alongside that those all us, a brings current table better other it of

our to going our our on continue to continue investors' with disciplined for are said, opportunities. we're increase; mentioned I at-risk our do provides We're us door does to capital. on investing part I but open of the to think profitability We'll and be disciplined and XX%, that, Now going and be XX% pour. creation not from earnings, the value we dollars. Like base that this to invested cap which

yes. So

John Kim

worth? use multiples what different you discuss to Well, can you fee different streams' the the value

Jim Fleming

really fee bankers. won't how with we this at next different you year, guidance company. for each some can we provide we point. stream. building fits We will that our with John, provide understand get this did What we into blocks as we'll look say it the I will evaluated at so type do, of

multiples the public with that private were holding other make had and both bankers. that and real to estate of were And durability, during this sure the looking were we looked on we diligence numbers the transactions, terms really private real and real year. in with we paid at been estate, In public at targets, up our

we it, all we about so say this can point. really but feel good that's And

Operator

no time. are the will questions Mills There turn at I for remarks. this Nelson to further closing call back

Nelson Mills

for updating forward, ongoing the participating; can provide look forward our future and everyone, soon we'll today. the thank be And about we're Well, to really really appreciate transaction. very more grateful in tell, Trust. you guidance And of on the do interest and your do more questions. you we rest joining value for to this XXXX. details and for recent Columbia are opportunities with questions, you, excited we you And able us great going as creation We and on Property year

you thank any time, Have your you questions. again out us anytime So see with soon. and we for a please reach hope to great to And evening.

Operator

for you Thank call. conference today's concludes this gentlemen, and Ladies participating.

disconnect. You may now

Columbia Property Trust (CXP) 26 Oct 192019 Q3 Earnings call transcript