- Earnings call transcript Q3 2022

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Operator

Good day and thank you for standing by. Welcome to the Kite Realty Group's Third Quarter 2022 Earnings Conference Call. At this time, all participants are in listen only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. to McCarthy, conference Corporate Senior Communications. like speaker to Marketing now Bryan today, Vice would hand over the your and I President of go Please ahead.

Bryan McCarthy

third Welcome Thank Kite afternoon, and call. everyone. you, Realty good Group's quarter earnings to

that materially Some assumptions based from subject inherent these of of Actual uncertainties. are on risks and statements. are and forward-looking events results today's contain to comments statements future may differ

results. our our refer most financial adversely information Form affect that the a SEC these performance about filings, available please results, measures. earnings reconciliation more remarks including For Today's non-GAAP for release can measures see recent non-GAAP XX-K. our financial also to the company's certain our website to on of press factors include yesterday's Please GAAP

me Chairman Vice and call and President President Senior Relations, now Officer, Tyler call over Chief and are Henshaw. Officer, and President I Chief will to the Fear; Chief Buell; Markets Kite; Financial Officer, and Tom the Senior Executive turn On Operating Accounting Vice President, Investor Officer, John. Capital Heath John with and McGowan; Executive Chief Vice today Dave

John Kite

Thanks everyone. Bryan. Good morning

highly mark So, one-year wanted to to dive results, anniversary quarterly I before a moment of into we take our strong successful our merger. the

and first NOI total second operating the best-in-class in going quantum year-over-year first platform value, as margin, outperformed as and generated growth, year, XX net incredible first transaction, past to ABR a first quality across in by a KRG of and the ranked both debt While in of the total signed-not-open strength outset, preferred we We forward of NOI. as total this blended in we our G&A first to in year-over-year we cash same-store recovery metric. enterprise the second spreads, portfolio, coming top the second knew every our significantly in Sunbelt; from over Due EBITDA; of expectations. leasing in internal leap open-air our percentage a peers in percentage plus rank year-to-date in in year-to-date FFO meaningful from second was Of revenue. be high to decrease a production GLA; NOI ratio, an and of percentage external percentage

specifically We percentage the in attention numbers we're industry. and I've value. liquidity to the into as operate results. giving compare fourth call also that total best to we've I we and enterprise in higher with ranked metrics are to of our a stack than listed ability credit wanted When much The before up our diving demonstrated sector, across you remarkable for our

Turning consensus to our representing year. $X.XX, per share FFO over beating a fantastic increase estimates of by period generated KRG share XX% per adjusted as the comparable $X.XX, and last results,

is which spreads quarter XX.X%. bolstered an high of leasing strong The that To of and alone. that portfolio context, X.X put all-time was in total square blended quarter, this X% leases comparable in million X.X% the provide nearly our performance. this X.X% quarter suffice say, will and been guidance details Our We and year-to-date. of of discuss we're for around was streak leases same-property our our more growth outperformance results has driver XXX the KRG's The metrics, the to of continuing primary but components outstanding signed by GLA volume for renewal cash new NOI leasing representing Heath feet company. is these for

XX.X%. comparable renewals new and cash Excluding were non-option option spreads renewals, for blended

achieve like of to important and to on renewal been we've first just for We are and leases comparable strong. highlight cylinders. metrics. over three offer quarters capital non-option The year-to-date, XX.X%. and us million firing cash available For feet our some vacancy X.X new the of leasing best additional blended three color efforts continues portfolio provide our on new adjusted remains retention To the Comparable been leased on at have XX%. square spectacular spreads team XX%. comparable spreads has renewal return KRG XXXX, all risk demand for leases ratio and XX% I'd Leasing returns of retailer under

on leasing In robust addition signed-not-open environment, we're to making the excellent $XX our delivering progress million pipeline.

page as decreased by of and rent pipeline rent presentation. continue commenced, moderately our $X can come NOI sequentially as the Our XX million online internal new to Tenants to the commencements investor commence found budget for leases moderately outpaced be timing -- ahead rent signed. on of our

ability on-budget a our bode our intensity rent, supply as pipeline we team's within the we space. growth and spaces a to NOI organization. continue chain to to have The world to signed-not-open lease for trajectory, Our tenants in and that testament continues additional deliver constrained commence on-time is well

levels million the $XX presentation. Leasing our active would of nine portion coming of online years. to an balance to NOI As a signed-not-open the opportunity, over $XX pre-pandemic the a page the investor is reminder, of near-term million growth on as the additional next of portfolio equate of only shown NOI few and our developments

On the under commitments active remaining, $XX development just future with capital limited million. four front, we projects of have

As primarily our dedicated we've mentioned, near-term to capital leasing. is outlay

to our development team entitled In efforts, continues our of leasing to bank. land the value our further addition enhance

million outperformed win phase square multifamily commercial We considering establishing rates commercial feet Loudoun. In feet at units X.X convert land first and significant our project, rezoning Loudoun entitled vision rents the of multifamily pro for took One X.X of units forma to materially square fact, is huge for X,XXX our we in to recently multifamily the at absorption GLA. per of receive a and square approval GLA million the a One Adding step adjacent foot.

the our allowing a $X.XX of KRG. as FFO to to of reminder, at things us all guidance share just the is evaluate to increase range best $X.XX our the definitely also use $X.XX, best the highest will at of team's raise discussed great operational We're we'll We've the into points adjusted estate increase of bank continue midpoint. XXXX to I've I'll to our an X%, range real for XXXX a a call per past KRG in basis Heath. NOI and culmination produce to excellence. of our proud prudently in to and we of the land adjusted extremely way midpoint. each XX I'm parcel determine risk come long results. returns now raising a showcase X% our the to dedication As turn the a and same-property the efforts strong year relentless The and

Heath Fear

Good us morning and today. you for thank joining

one-year the the able anniversary team I am of in what As been merger, we marked accomplish. has our awe of to

KRG of unparalleled All in it four past but initiatives positive the for would this the not is my of sheer Looking the be is boldness that a change years change people. the further career. and little velocity our evident past, witnessed into our at tenacity I've possible, of over

are We our our response sector to execution kept. all leading the the course of XXXX, of of over these promises XXXX, and are of COVID that's our business stakeholders and what exactly transformational fulfilling in efforts XXXX, focus XXXX, the merger integration in in we've intense in the Project promises done. the

Here's his we John one until noted promised for more, the we credit to work in all appropriate get remarks. tirelessly, progress the

of expectations, growth by results, an increased as recoveries. X.X% this levels higher net KRG our the on points this budget. bumps leasing driven generated stance basis. initial grew and per continued occupancy being Due contractual outperformance XXX share basis Turning NOI by adjusted this of to an and Same-property versus our quarter and to quarter, to beat our XXX rent basis with in our our $X.XX points third overdraft internal quarter attributable our increase to results for

same-store basis to to increased our of in points quarter. with safe same-store for line expected growth is be the it midpoint, XX is that guidance our was assume year this Given to at balance the the X.X% largely to

between merger the attributable of leasing the form of overage range $X.XX million $X.XX are guidance increase $X.X From retention to $X.XX, NAREIT offset is to a FFO $X quarter. as higher and million we we as as is FFO and we've of rate. don't costs approximately guidance our adjusted the this which a anticipate third outperformance, earlier, point noted at to increase of prior estimated a which through to $X.X same-property collections the FFO John further from $X.XX higher lowered NOI As any forward, midpoint. adjusted in raising periods by is rent, variance million,

is of at our midpoint our year the from regarding assumption of guidance, activity our The at impact as-adjusted Furthermore, X% to other transaction full kept in the attributable assumptions accretive. FFO revenues. the our flat change neutral $X.XX debt we to $X.XX bad of

As to toward XXXX, our presentation. five you refer of look investor page please

position discuss that XXXX. have a in we of internal the to our assist While FFO not guidance our of outlook, into modeling XXXX you in components highlighted will we're some

front, sheet On a we the very had active balance quarter.

which is our to debt with net stands EBITDA Our long-term in X.X times, target. line of

term $XXX important note rate in our line maturities upsized issued this previously the our dry $XXX all and $X.X XXXX. loan past and interest is fixed we with to powder seven-year and to of our credit As capacity, satisfy we credit unsecured we It's X.X%. have a billion million quarter, of currently announced undrawn of line by enough million that at through

goal to maturing fixed unsecured stabilizes. income retire proceeds As mentioned market is on prior calls, with from issuances our the debt once

within an the which end, aggregate was XX-year entered the to million. XX-year Subsequent quarter X.XX% generating last a to hit at for X.X%, of enough rate time, to at starting We million. two were cash-settled December, the fortunate XX-year of disclosed, X.XX%, instruments total both swaps notional previously As $XX swap amount forward we we lock-in equivalent $XXX approximately proceeds treasury.

weather year. built and economic say confident as have conditions. our news fixed next rate gloom. starting feel we we will leverage XX proceeds off sheet the anxiety profile, in extremely and for interest over with the With all and the accounting an to late liquidity in conversations been be amortized XXXX. next associated that dominated like to the intent on our based expense by realizing balance We offset The to For our future, issue our debt purposes into is unsecured years headed

it regarding However, us we negative extent are helps At is XXXX point, prepared. to this prepare. the fully speculation useful

the today. for better joining remarks. Thank questions. Please to is everyone prepared Our you for Operator, concludes this call time for the that potential lie our opportunities ahead. line planning open spent the

Operator

you. Markets. question Todd Instructions] Thomas Capital Please Our question. your with from Thank KeyBanc [Operator with first proceed comes

Todd Thomas

$X.XX guidance seem at down there Heath maybe term you third Didn't the -- just quarter can provide And a Good questions in pretty of the fourth we non-recurring revised the as look detail third that midpoint the really the guidance. the you around maybe could was revised if fee step the in minimal. curious to $X.XX us around help guidance of thanks. from down was income like the of quarter move forward? for lease bit quarter. Hi, anything little -- Couple bridge morning.

Heath Fear

so. absolutely that's Yes,

there a land $X.XX was all, was the of there a nearly First is which in game, quarter. sale

these things but Again, item. that's So, one-time recur, they're sort a of unpredictable.

in said on. repeat and our hope can't it's page we to I'm also We specialty we able be fees outperformance to fourth some our we bank on quarter that are of decelerating. And overage this development had quarter, that something five, rent investor deck, the into nice the into and while

So, that things I that a deceleration were, happened the some but again, third recurring quarter. on unpredictable based like in it's slight said,

John Kite

I think I'd Todd. just add it's a range that,

you So, we're range. a giving

this so And outperformed. far we've year,

of So, end range, top we would we'll hope see. but the to not midpoint, be the in that

said, unpredictable there's it's a range. a Heath As but things, couple

Todd Thomas

the those the so that deck. XXXX Okay, provided that -- see slide income, to appreciate yes, in the you with regard I that and in considerations

appropriate forward? in I should going of that relative million that to $X.X to income, mean $X.X range about how million? be we thinking So, terms fee an moderates what what's of consider

Heath Fear

question really with into next may a a third-party year. some the allows or on a issue In that maybe more visibility that not That's February, on Todd. will that. sitting we're commence it project And great is --

and into So, we'll a have fees phase there's the additional development year. in back sign existing trailing or project, have then in of potential something half the else up of XXXX. off the And we the some sort that

But though maybe thinking I or can than visibility will fees as -- half number. into be However, other be in we next so where purposes, going those about you have less maybe projects February, another to started. not we've probably your going little a tell started and it's got less that year, it for right whether in of is or we'll even again, terms more project and the half

John Kite

Yes. now we're in on first the right phase. working And it

to final But to the for hoping take like said, continuous are that we'll Heath point. wait information. we So,

Todd Thomas

the Okay, regarding the change accretion investments that? completed $X.XX that year, in the during what increase guidance, to driver got then And of was it. from that and were the

Heath Fear

acquirer net the year, $XX balance At of don't point we're think year, this this anything million for the to else the in we're Todd, at we we're and going close point.

to net So, just and that were slightly fact dispositions acquisitions works out acquire. the that that -- the the the math It's were just that in based on early year $X.XX.

Todd Thomas

Great. Thank right. All you. Okay.

John Kite

Thanks.

Operator

Thank you. question And Craig with from comes Mailman our Citi. next

open. now Your line is

Craig Mailman

Thanks guys.

the RPI underwriting or the to a of, get the maybe performance topper just kind market of curious walk you Was a a Could be the Just through kind just portfolio, the maybe trying books kind versus portfolio? on of relative legacy here. to of could of guess much how experience it? that kind benchmark wring your in on any I'm continue I if for you that guys the of to of disconnects growth, between performance continue value to year? out to at

John Kite

comments think I our we year to in that now. the the performance trying expectations. terms pointing you and full Hey, in absolutely a -- And started of out above I just terms the that But guidance, at question. Craig, try if in -- the exceeded were I'll midpoint, understand to year, of we're just that mean, we look end XX% our where I'm

gone portfolio. each it's And quarter I has the asking. also So, as of in each been has topline along, quarter they've mean, that's leasing our well, rents, pretty across you're if the grown balanced what total terms that

centers pipeline, on right? on So, our at different as occupancy terms overall, in in the that we at position the categories. of we've types of elements property own. timing year is run we about the And know, underwriting So, cash I talked we that it's outperformed look And that and those we that we properties at each it's you from because in we capital, we about between, really neighborhood of room important these I we're there's the we with lifestyle and this different to the really the community company these really significantly think thing point two quarter. sheet, that XX%, of returns and now mean, I to and estimates north have able And all while generate we're up. than of a have -- any fact and one look use, that returns rent mean, of don't a totality I talked lease balance our particular driving don't and the think, good that those coming flow. right signed-not-open actually balance the independently, outperformed and on mixed think our I fact centers our the other end, FFO

but be So question, you in were exactly that may what feel not looking for right how we that's now. the

Craig Mailman

about just No, more maybe it this of The sort much did be of trying been was And is I forward? upside? way maybe outperformance thought a guidance to I'm just get [Indiscernible] to by of as of understood outperformance into from RPIA to bit from I not you getting guess just I guys this willing portfolio? may trying I weirdly, juice than are a legacy may XX% going How from that raise at versus guys have underwrite there year. was a you we as little is That's a quite at, Street? by what XXXX, head RPAI it kind

John Kite

doubt has no, the appreciate fact really And that. yes, for step so that in I you're is opportunity acquired to squeeze there's portfolio out that platform, I was no the to combined the Yes, of operating it orange, this our across there speak. portfolio. And and And that misunderstood. more shined right, us think in

you that one room the of in And highest mean, NOI, the NOI I of into percentages looking set think more up in space the It's same the year signed-not-open terms a of kind of end. continues. have I we've again, as of very we total, way you've think yes, run. to why So, when have it your we percentage got

Craig Mailman

looking of retention? were assume, just how the could know, That's talk experience that a maybe And you quarters, the of you in couple a on I despite good then helpful. increases? you versus those had And And some renewal that the just quarter, space guys higher XXXX? you in had new, rent over guys to leasing up tenants about of is in pretty last step kind stay really

John Kite

to want you hit Tom, Sure, that?

Tom McGowan

Yes, ability helped space. overall that generators really there's fact have the the a of demand of would now about and of the is to right And position that demand part both I new say our as amount have. secure us what a outpacing terms question have truly no limited in we maintain in We're we tenancy. that

we to generate has and we're situation able So, we're returns manner. pipelines to here look to like that the in the strong this at for basis us that are But at and reporting numbers cautious been first proceed not all be we fourth quarter, being generate And slowdowns. that that But forward hoping today. where for continues. you a point. are if our indications, We'll the showing able

Craig Mailman

maybe And game could Heath, And it? -- be of many just derivative over? to assume to missed [ph], the probably one ratable. just going amortization how look If Is way the more Okay. I that that's I for on it's in slip I at amortized when just years

Heath Fear

It a XX-year swap. was

amortization a will over and term XXXX. it's start in So, XX-year that

Craig Mailman

much. Great. Thanks so

John Kite

Thanks.

Operator

Thank you.

with Our comes of Bank Jeff next from question America. Spector

now is open. line Your

Jeff Spector

great question morning. appreciate good first again, the and all versus your my I Hi, presentation metrics just, the the greatly guess comparing comments peers.

disconnect pinpoint few it size trying these delivering gap? on to type think much your to What multiple is, that you it a are numbers of center just is close say you're maybe a of demographics? let's So, thoughts? average Is consistently the where too what just focus, quarters are

John Kite

we to wish the I mean, that. specific Hey Jeff. Yes, knew look, I answer

is that. out job then fix disconnection lay to our and the think to I work

I when mean, at a we picture, more major would -- look part complex size, of merger in company at does the a a I it doubles when instinctually, total say year ago, think a it than in the I world. time

an a that at people And to -- priced clearly, get wanted me a I shopping wanted clearly as shown of stacks but best show people you're looking there understand this center to need to think to was way. them. air we I in company lot that And now just in the story. business, it's open think we've up of see one -- clearly, opposite

three-mile over demographics our about Sunbelt. So, when I can't three-mile Jeff. the population in We're XXX,XXX. you you both and exactly The mean, are I tell household demographics, strong. are income talk average

We a you no of anchored mixture have good grocery properties.

So, I we And out remarks. the importantly, was what boxes. I outperformed. my in checked we've more And flat outperformed. we've mean, opening just laid that out

estate, it's when real have outperformance, not this why of do So, you the the quality not in of best understand business teams and one combination we reflected.

Jeff Spector

Fair signed-but-not-opened. comments. just question, then the is My John. second on Thanks,

Just anchors, if I least, risks? over what months, kind the signed on around the you there of think out particular are leases and openings -- is any the opening the next the your expected years? lay guess, you at where in to chart compared these -- income risks coming about XX the

Tom McGowan

we're parts relates I to thing, have this out say in will happen. takes long we're China, pre-sourced it part our make to construction to trying has the will one that I a whatever mechanical been components for figure to out tremendously And we're and we units. switchgear, for for figure different sourcing you going we're looking tell it a a that Well, that mentality of backgrounds, group this doing and time,

of amount issues. that to of experience, team think hit with But goes got on these how assured this on a tremendous that lot a there's deal make has can sure I be to work So, you days. we

have it. underground service We out not it. we're get a XXX-amp power figuring right to while. going have we're in to how building And power to a for permanent And has that now

to So, the the does. it's we're this that's And you will And battle. figure it what I OSR that's, tell But going mentality. that's out. but -- that. team

of deliver the the ability confidence So, in day. we have our to end at

John Kite

you we've in what year, on-time I ahead schedule. at we've bottom-line, we've year, this though, of if look been mean, done Jeff, fact, delivered this

continuing we to a this particularly So, this because is, we this other have is referring construction own I in of have, reason lot company, that our think because in the have that's strength complicated how what another was when days, It in it's construction that the it Tom's peers a started. coming. we'll background, have we to problems XX don't rents do world, you any when XX company company year don't XXXX. a anticipate the to problem, do have it's next days, a And And that started. whatever, frankly,

maybe people pretty investor as month that It's we we our out and presentation means, signed-not-open matter don't in, accurate. good this rents So, lay that's what believe a in understand as it it's which of can coming. coming we and that idea that

Tom McGowan

to Our hit bottom-line. the job try is

Jeff Spector

to where No, the question, there for in anchors, I comments. out? back the get are again, could we thank guess you the clarify on still any anchor that particular, that still clauses

John Kite

Generally, last it's really got cure, on built that. I -- you're anchors you is but time remember rare. mean, nuance construction, out. risk would time. to I a you've general, Each you've It possible? landlord, different. Every and possible, deal Of obviously once that's cetera. of -- We cannot talking But very categorize built you've under big it the rare. for would it course, in be over is can't in it. general, got mean, backing like et some you're has something it's when in lease be not got the all

Tom McGowan

It happened has last guess. I within decade, not the

John Kite

missing you of lot question, rare. are glad very a So, think there upside Jeff. is I'm up, for I that us. a people bring But potential that If

Jeff Spector

Great. Thank you.

John Kite

Thank you.

Operator

comes Wes And Baird. our next you. from Thank question with Golladay

is now open. line Your

Wes Golladay

the lift Hey, venture And I'm at you're of getting everyone. you're the going zoning joint yourself the more or residential Loudon. platform? if curious going morning, just congratulations the good to do of new on to

John Kite

parcel like mean, like I this, every analyze we to Wes, about, we're we're think talked that analyze going to we own. I land going

the in generally situation. the -- mentioned these can look we we've highest return we think in on from the to at capital past, any what's I get our perspective of particular like is what

just going be. rezoning the relative yet within that think the land significant The determined the a has multi-family. what's point on haven't value in the to mean, I we're we exactly to we weeks. last will few is what market I particular in trying make got that structure So bump

we'll we going the whatever one at step value just KRG. to do, So take But a maximize that we're for time.

Wes Golladay

it. but for And any I'm looking is the other of? guidance, not year, be next Got the there moving then that to look swap. discussed we we parts We should We fees. discussed as aware

the One lines? want other go the is, getting adjustments of to questions call we next anything any value into we're one-time non-cash as out fair there on may you is those be year, anything in Or that along nature? things

Heath Fear

forth them nothing happening the No. of in set We non-cash. all investor X on There's Page the presentation. occult

for So to outlook again, any expect non-cash XXXX, we our not we're don't but surprises. prepared give

Wes Golladay

it. Thanks, everyone. Got

John Kite

you. Thank

Operator

Thank for question. you. next Instructions] our [Operator One moment

Connor with question comes from Our Sandler. Mitchell Piper next

is line Your now open.

Connor Mitchell

taking morning. good at a Thanks my just for I looking big question. guess Hey, view. picture

retailers. are sales, positioning? retailers guys their see seem real and your it to changing range tougher like what demand of any estate they're to abilities on and we shop the correlation the So headlines their and maybe if people's to you impact with but of Does talking tenants inflation there's

John Kite

retail, this No. and in our I in strong which open-air A see point, an is results, base what I to our at ever we supply continue own. shrinking we this pointed we point, mean Class demand for as remarks think, out, not at

would the pointed I when platform. that I people retailer, space. in other physical There's now other calls, you are retail decisions retail, reasons investments lot these that be profitability conversations So looking the a in physical darn that of and And to generated pretty if you're this you on mentioned dealing that long correlations before generally second sense of in it's these estate we've continue are you're away. it's say space. been draw decisions, types our Sometimes conversations decade that of thinking right that make but to physical long-term real earnings in not with happen do their why money, about they're right? need decades, months, that are think the clear don't to quality a like is derivatives out necessarily

of combination kind And things the that be pretty one it in continues it strong. think is at month economy. terms I take great now, overall of us. we time really right for to But So a of

Connor Mitchell

then the Or guys I you're sticking Okay. guys focus growth IR it at mean, your That's versus of of but with looking guess narrow point staying just are big dispositions out the seven that on you more the you a theme, pointed in seems And your Sunbelt, in. markets regions you that of It kind I the just that down to the I different maybe being helpful. of out guess and are is the picture the also or some growth deck. markets further regions lot Sunbelt? highest -- in higher you are acquisitions in north. Sunbelt the

the So if market's touch you on could just guys update.

John Kite

the growth on markets, not our opportunities driving But decision-making, looking own out to and and that's we revenue that at own but Florida. at XX% be from focused we York, as we're increase air we the owns in you're Sunbelt to looking Seattle, rates such you only you're really past, I very XXX comes when but mean, And major of I've the cetera, yes, cash very would some definitely what's Sunbelt continue be that -- major on are we're of Chicago, quality real high estate have and properties et mean, extremely metros and the are kind Sure. been also definition. fortunate as New I flow, the in markets open in. Texas XX% enamored player that to pointed with that

markets and are That doesn't important mean very that that are that very, there two So important. those other you there markets in. we're can't that states deny aren't aren't other

think very to forward. is balance grow we'll appropriate going our see So where and we good, continue I

Connor Mitchell

the color. Appreciate you. Okay. Thank

Operator

Linda you. with And question Thank Jefferies. Tsai from final comes our

line is Your now open.

Linda Tsai

the like coming occupied thinking what Seems XXXX cushion. for not this bad year for online in is a and remind side about nice the you you're XXXX Hi. Could debt XXXX? the expectation us

Heath Fear

to like we that points as XXXX. a view assumption I sort question, we're as on of be we'll in year, wouldn't conservative for year, historical not our basis the be into approach, what my we're we February, based of conservative XXXX, pass very average better some XXX with is out take but a we this Yes, a this revenues. little where took of started the is have bit will on X% higher XXX of I'd think points, then than XXXX. maybe a the in looking approach next headwinds surprised conservative remarks, if seeing. just probably And basis And in

it's something we'll more it's going guidance. I But year that February, our us we So on for assumption. prudent think on lot remain to give again, to conservative be have in clarity full again, a our when

Linda Tsai

Helpful. guidance NOI momentum same-store XX same-store raising And nice basis XXXX? for points. then How it NOI about by growth preliminarily you thinking and are growth

Heath Fear

got It's We've obviously stacked pipeline. going a to be good. SNO

In quarter addition, last on going be fully annualized to turned well. that into we had leases are as XXXX that

at into outlook very, season to we're is it's in heading know budget that at here we're into, we're in point November this So strong February, a through in again, -- very looking of but at time, and more same-store next the and year. NOI assumptions heading all going relook -- we'll our our preliminary

Linda Tsai

much? why merge did so then And down did estimate, integration that why our go cost it. Got

Heath Fear

to less just of were trickle There we to those some some into and items going were they year. higher be had items of those items that next was some budgeted technology were, were, costly, conservatively again, than

just it's basically costs. technology again, So

Linda Tsai

Got it.

power, you the last you When from one, neighborhood, community, where most one look formats leasing for are different -- John. across competition the you seeing when retailers? mixed use Just

John Kite

think probably Lifestyle this Linda. has segment the out a ton it's year, mean, is Well, the that the think up competitive in board, I segment. I I pointed picked as we I past, mean, the across

there, real we've the So but strength real we've board. really seen across seen also strength

So I again, going the supply I'm just shrinking think, as pound person it, a we're world. one in table put to

an hear But did is this I I are and in we decisions, well. sensitive I the before, I have long-term I Adidas So limited a quality and tenants that. a around. as we center, the example, making they're maybe headwinds. we macro said, performing as for extremely idea that have that, I deal, sense really space, the these reality less of in they mean, moving little said it's mean, understand mean, is, power

list, Total think what mean, you can different I'm trying give properties of going a longer actually that I long Wine and the board pretty across they're what at the can you say. look Tom a doing is and I strong even list, it's types I give in. to You they're that

Linda Tsai

Got Thank you. it.

John Kite

Thanks, Linda.

Operator

you. an Lucas we from Thank additional with Capital have do Christopher And One. question

Christopher Lucas

out, and big you before just a touched started specific on do Ian? -- I it, quarter. bunch spike about to the right. of I I maintenance the in All Okay. worry if find that maybe anyway, but CapEx to not it, Was call. wanted missed the for

John Kite

Ian. was it not No,

to Ian. everybody definitely was ahead, not that Sorry, go But Tom.

Tom McGowan

Yes.

Chris. on go ahead, -- So the

Christopher Lucas

drove what to just big I was going spike? that say

Tom McGowan

Yes.

to So the out process. spike of a related some COVID the One couple is delayed coming items. we're of which of

supply this chain The during were capital was to really this we way we inflationary the had. best other to situation that one is trying what spend contemplate

some pricing moved out So them things because the of roof so being in down lots. parking brought high of we

And the everything make standards. the wanted to we were time sure I And spend met in of wanted buck. end we merger. is to sure make we best the final have the maneuvering think bang get portfolio our pushed the we going consistency Chris, thing, that create And things the us that through the throughout platform. for were this lot And we the portfolio some there really address a of through to spent the to that So year. then higher to really trying towards

overview, really a got the best an pricing that's but just we to timing in of hard and make work the it possible. lot going sure So was

John Kite

way, it free Chris, we say flow. I mean, another cash mean strong have I

Tom in said. we're So the investing as properties,

So I into these next cash and think to one don't reason properties, and free spend it's there's year, seasonal, a of will the X we particular flow. of invest continue But going and the good way. beauties having of that's in by some

Christopher Lucas

that have I got while next likelihood Okay. contribute deals this your you good year's strong is ABR? what Thank then pipeline so will of to at year, a sort for SNO you, And Tom, point next of you. the

Tom McGowan

I XXXX. open tank going have is a that projects we of into our the boxes still at nice upon continue to run terms in as looking lot based try be like as in. way. we but get signed nice we're so was we efficient gas I them a feel going possible these and those that have of lot. just comments to to to But a to growth in pushing very that pipeline up, then can't And of obviously, the going think coming But we're specific, many and as I in continue in see too my previous done list area. we in of came most

Christopher Lucas

all, delays? get Are Or to running at into commenced? that mostly your ability chain any you it impacting guys it, supply if permitting is

Tom McGowan

Chris, of last $X.X properties all We into million. were very damage were I up was fortunate around touring issues. Florida we to and week, end number ran a that in down the with

about good we those on fixed the of group them we're -- that, getting So as jumping already possible. is felt taking very and quickly and care as

of So I pretty that good overall, where we are mean, feel terms front. we I in whole think on

Christopher Lucas

one of in out the understand, trying those is portfolio opportunity in saw operating for to RPAI And that to all the nicely, I'm all at is of is just numbers one you record me I then metrics? my for rented at level. recovery come? guess, of now them is rates opportunity fully of bounced the on last up more margin, terms Or kinds there least a guys you

John Kite

we we room I and No, think where more have to we that -- push we've to there. don't get, gotten want Chris, don't

at to one had were know to so was top the XX% I close. the probably think historically and we of do was about very there's that maybe successful but that, as many head, RPI pointed but we with we've That's it's basically fixed cam, fixed I ways -- gone no the portfolio cam from them my past, off out of in XX%.

getting run how there's then also we price things. we way and just operate to the efficient in So more room more that and and there then

like hope think continue So press run. we we have I just that we'll we room percentages, to continue our still to to press lease good that,

excited I'm to the get back pre-COVID opportunity So to really about levels.

Christopher Lucas

guys. Appreciate it. Thank you,

John Kite

Thanks, Chris.

Operator

Paulina Street. comes with Green Thank you. our Schmidt from Rojas next And question

is Your now open. line

Paulina Rojas Schmidt

Good morning.

John Kite

Good morning.

Paulina Rojas Schmidt

reminder of further seeing risk consolidation The a the was Allisonville that in of program industry. merger

speaking, not how just mean way you grocer related deals? So think if any you tried incorporate in you And I in merger. that about to about this your risk, evaluate this broadly when listing decisions

John Kite

consolidation, particular is Look, as situation, by I our see to think this we that. industry portfolio portfolio. In risk always in your big trying to a looking potential any how in has think this don't affected through you're that

grocer is largest private Our extremely an is Publix, strong grocer. which independent

So a when in we particular, think, that see is portfolio honestly, And quite talk it's to in as the to people risk don't massive why comes the think grocery it a have property how misunderstand down to important about types. us. balanced sector, I this I misprice to it and that. And continue I

massive space. issue thing, fact we love still different players, into that we But issue have centers it in don't of it's the diversity an the our them. is in see other particular. associated far, so consolidation, have property a a with We when less types. in a probably not the than So, future have good risk the us the you cetera, so component of to huge the sort grocery and of and grocery XX% we or some value et types, But then get retailer of that's

Heath Fear

XX we just about Kroger Albertson X.X% Chicago And represents necessary three-mile for competing ABR, grocery is a operating we X are exposure a so so the one we also, they're not under the huge only overlap, overlaps, of have have flag, to which with each around And them And in in Paulina already did arguably Chicago numbers units, of study the are a in merger, Kroger, radius other. some our the area than world Albertsons, put there. specifically, already area. is the Dallas one the larger area and two same and one in XX

you this seen couple So us. the now of the good the merger. that we to attorney is going state generals are merger feel goes to if That's through, the very this challenging -- morning be have news a merger transparent may

of they've do we'll So to got done. it see, work bit a little to get

Paulina Rojas Schmidt

And I then store be long it process. have closing will portfolio? seems the is question, of other in a any it beyond you do Yes, know your

John Kite

Any we closing, no, Bed obviously Bath have mean, some that Baths have have -- lease we Bed I expirations.

that couple in potential I upon XXXX, there's of so them those two think a expirations, of lease And expire. them

component we that's not example, lower Baths The Buy strong Bath potentially But Bed real premature know close, very may of of the versus for estate company but candidly, unusual. we they any generally And that have no, are So rents. don't Baby, By closings. Bed there.

a good us. be very for could it So opportunity

Tom McGowan

the advisers sales, we studied that ones We talk And if natural are. Beyond are our Bath all of and have way our a We, you through & they where the than take in pretty consistently. our the their look course, go of stores other confident positioned, Bed terms feel expirations. at of stores to

but our specific terms a like we're stores themselves. of So eye, in the we position keeping close

Paulina Rojas Schmidt

Great. you. Thank

Tom McGowan

you. Thank

Operator

turn for CEO, Thank and the I remarks. Mr. you. This Q&A closing conference Chairman now to would back Kite, our like concludes session. John over to

John Kite

on it. joining to just for soon us forward everybody you thank Look I Well, at see want NAREIT. to

Operator

Thank This you concludes call. for today's conference participating.

You may now disconnect.

Kite Realty Group Trust (KRG) 3 Nov 222022 Q3 Earnings call transcript