Douglas Emmett (DEI) 10 Feb 222021 Q4 Earnings call transcript

Company Profile

Participants

Jordan Kaplan	President and Chief Executive Officer
Kevin Crummy	Chief Investment Officer
Peter Seymour	Chief Financial Officer
Stuart McElhinney	Vice President of Investor Relations
Alexander Goldfarb	Piper Sandler & Co.
Craig Mailman	KeyBanc Capital Markets, Inc.
Elvis Rodriguez	Bank of America
Steve Sakwa	Evercore
John Kim	BMO Capital Markets
Emmanuel Korchman	Citigroup Inc.
Michael Bilerman	Citigroup Inc.
Blaine Heck	Wells Fargo Securities, LLC
Richard Anderson	SMBC Nikko Securities
Bill Crow	‎Raymond James Financial
Daniel Ismail	Green Street Advisors, LLC

Call transcript

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Operator

Ladies and gentlemen, thank you for standing by. Welcome to Douglas Emmett's Quarterly Earnings Call. Today's call is being recorded. At this time, all participants are in a listen-only mode. After managements prepared remarks, you will receive instructions for participating in the question-and-answer session. the Relations to for turn President McElhinney, now Investors of Douglas will conference Stuart over Vice I Emmett.

Stuart McElhinney

our and Thank on you is next will Kevin being President website, from This during the be the today Peter Crummy, CEO. and call are webcast XX our for Jordan Kaplan, call joining CFO. CIO, and us available our replay Seymour, live our days. for

earnings our our can at Investor Relations find of You section website. the package also

non-GAAP financial the of discussed during You in reconciliations can measures today's call earnings find package.

forward-looking will During are the call, of, information this the course and assumptions us. to on of make currently we forward-looking made available by, statements. These based beliefs statements

beyond will known to affected by ability results trends, predict. and actual uncertainties, be control that our or risks, Our are unknown and factors

assumptions we be may reasonable, prove will future expectations, those differ be that Although not performance, and future guarantees and results they our to actual are our some material. believe of our can incorrect. Therefore, to from expected be are differences

For risks, yourself consideration and SEC I please Q&A Relations follow-up. we in a the of found please be others, now our will refer some question the the section in reach potential of which to can turn our website. Jordan. filings, portion to to When you. detailed one over of limit description more one Investor Thank call

Jordan Kaplan

joining for Thank everyone. us. morning, you Good

leased more retention than to the tenant pandemic. space from XXXX, impacts office recover continue we any the We with prior of in XX%. above strong year In

our averages. kept costs pre-pandemic In below lease meaningfully transaction addition, our we

year the Brentwood expectations. XXXX, financing new in this XXX residential X% our our roll-up transactions. in and at average completed XXX in of unit our completed each are delivered apartment project across last excess project we construction In multifamily over fully a We billion exceeded has $X.X properties Our conversion units Honolulu. Leasing at with in of rent leased, our high-rise portfolio. quarter

our And until only rate average XXXX. interest now next December not maturity Our X.XX%. is is

convert cash continue revenue. non-cash We to to

revenue. cash During uncertainty our detail. revenue about XXXX, office utilization discuss our that represented more around total Kevin. development XX%. our remain improving lingering our XX% at COVID, will I in Kevin optimistic of We estimate our and fundamentals pipeline over Despite

Kevin Crummy

good Thanks, everyone. morning, And Jordan.

As that are Landmark Los construction excited to we Jordan have completed mentioned, we report Angeles. of

At Our to XXX unit, the tower. of the conversion, just more will Honolulu units high-rise all XXX than approximately amenities. over Bishop, and West pre-leased already month. downtown and half remainder of phases be to is areas XXX out. office XXXX Brentwood in constructed the XX luxury our tenants Freeway next move units office in move The residential stunning in offering as residential new first under This XXX years, our the completed views planned our a expect we of units. amenities have tenants development and We've and ocean common residential

progress at these next are development focused our on Given we projects. two properties, our

continue Angeles to past, our accommodate we flow. operating we residential development a new to would through we new primarily mentioned of Los and ground-up Honolulu finance excess the in in sites that As have number expect and our development own cash

residential an In additional program plan addition, repositioning office office focused our on and upgrade to through we asset and In buildings start repositioning repositionings. our to we continue portfolio modernize two two In XXXX, three properties. buildings. XXXX,

three non-recourse fixed January years. only rate $XXX X.XX% weighted in is Our loan another for million interest-only refinanced new XXXX matures have fixed debt. interest we quarter, fourth secured overall average term at interest maturing at effectively with And debt of we no X.XX%. The portfolio the outstanding During nearly

more XXXX that market. remained markets slow, transactions am property bring hopeful to Although I our sales in will the

cash Nothing remains our to in drawn Stuart. half after flow cash strong sheet. properties of dividends, only over office and low approximately line, balance of our good leverage, million liquidity $XXX relationships, unencumbered. JV credit excellent with access on Our our

Stuart McElhinney

everyone. Good morning, Kevin. Thanks,

good continue diverse covering consisting feet industries thousand signed feet, leasing the of feet of thousand XXX We new renewal square XXX see and we thousand demand office set markets. from to XXX XXX of leases, lease. In in QX, square of our leases square

and XXXX, leases leasing of all signed square square of our For highest That public of we X.X million feet, new feet volumes million becoming office feet a including renewals. XXX square covering is X.X company. million leases since X.X

fourth the and straight-line during X.X% spreads for leasing X.X% negative for positive, quarter cash. Our were

on XX% rate at remain leased choppy point this an the to back expect spreads trend. focused occupancy are recovering upward We near with climbs rent our until in cycle, and

per Our benchmark our $X.XX below trends in leasing line well year per costs were recent group this foot and our average. square quarter with

essentially Turning strengthening results. leased. and portfolio tenants will further With XX.X% with remains roll-ups our Peter We that, to Multifamily, during our rents QX, over to call for average discuss X%. to the in I full over saw rent turn new

Peter Seymour

Stuart. everyone. morning, Thanks, Good

of and compared quarter revenues FFO NOI increased our share. increased fourth $X.XX cash, X.X% million XX.X% same-property XX.X%. XXXX, XX.X%. $XX.X results to to by by the million Turning increased by to per to increased AFFO

to only X% Our revenues. G&A benchmark group remains of very at our low relative

promising As resuming of we pandemic we guidance. see signs are the full-year abating,

For XXXX, $X.X FFO between to $X.X share. we expect be and per

package. schedule guidance, earnings underlying the assumptions on refer information our in please the For to

the your impact now As over the of or I financing's. future guidance we so turn not questions. will the does acquisitions, can usual, our Operator to call assume dispositions, take

Operator

question. up a you. Thank handset you're remember using asking Instructions] pick please if your As your before to [Operator speakerphone, reminder, a

We are will pause registered. questions as here briefly

comes question first Alexander with Goldfarb Our now open. Piper Sandler. is Alexander from your line

Alexander Goldfarb

out Morning Hey. great. Oh, there.

Kevin Crummy

Hey Alex

Alexander Goldfarb

day. Sorry. you? earnings are busy how Hey, Been

So two questions.

first this the amount growth driving in we look the leasing, have [Indiscernible] rent been has that got it's treadmill. you California that but a still been apartment have the at in phenomenal guys the to apartments, apartment And LA. if when your employment rebound is The amount Southern like leasing, content spoken look phenomenal, the is, season, demand about all you big earnings of question, picture and

next strong is that between in in employment this strong the would that, So few read driving a to the logically Or you and direct the that hey, question apartment not necessarily to I is, guess quarters. that there's case, see tied, would to the should there two be start results while correlation. positive the we seem that's through a say, absorption translate

Jordan Kaplan

real correlates population estate. more to definitely Well, full

in So entire if that lost XXX simply during we -- three -- the being last last positive. it, but I we for quarters the think we quarters XX even leasing said, year, think was are our recession. it XX in XXX quarter. much over broke while two recovering seeing first And with of it been about was then points X% following of or XXXX, has basis this XX, COVID, seen now. And you've of a the pretty you

leasing on least So I seeing already we're front office, that recovery. think at the

Now that we that we've know utilization's told you the way up. think already you

leasing, So the been I mean, the spectacular. certainly fewer maybe residential it it's has around because of

Alexander Goldfarb

Okay.

what positive like So on as gain just lease like sounds we this should of on absorption rate we to -- year. there's see trend you it course translates you traction. sounds guys this go over we expect to and growing the the That described should continue occupancy

Jordan Kaplan

I when to kind agree subject you're Yes. hope like go yes. should and I But of with together. a talking you this, about mean,

Alexander Goldfarb

program. in you press that is The when the only you And you Okay. have Historically, less about that's of CapEx. discussed that's question view defensive announced that starting rent can there's We release do guys should commensurate -- you love next spending. don't supply you've the you and the batch buildings next get hope. that rehab with really probably on competitive

rents think this to that that come West encourage Maybe that is relocating is side? you read they that I time be the will so other don't back five still other the by sure of rent to upgrades of through defensive, to the deliver places. from that these just the tenants parts and was So or is to coming, [Indiscernible] aren't [Indiscernible] just make part office higher growth that know.

Jordan Kaplan

there's see the two things definitely Number our and Well, rent recover XXs you'll in I meaningful say, X, growth. think let me just get here. occupancy, back we'll

think that's that's So XXX%, I happening.

growth? compared done. think we'll not that growth get them redoing we'll rent marginal being that Now when to the does buildings, you I say rent mean a separately, just It's as get not we think it's

that think such gasoline more that that the that's and spent. redoing building. across buildings spend per rent of just get difference not that get out as that that this the whole segregation That's re-do gap, is get a about you get money money human to rents justifies the I foot that still low-end and being nicer just that higher I medium definitely I in to to just way, growth a and of in more. such when building we're rent community, feel and building, we that think statement to we'll think a the result statement that the rent I going

pandemic we we're and that when absolutely aside. the it do getting approaching rent occupancy will think process we're it's higher back XX% smartly. lost that and get I with much that as once, my I that spent once Stuart well said, see putting really especially recover we during that will that to in will So But recover no we money number, returns recover we mind doubt that we the just experiencing have that.

Alexander Goldfarb

Okay. Thank you, Jordan.

Jordan Kaplan

Thanks.

Operator

Thank you, Alexander.

Mailman is question line KeyBanc Capital open. with next Craig Markets. comes your Our from now Craig,

Craig Mailman

of look appreciate the the and different Maybe it up you kind in and your 'XX for 'XX quarter I of Hey, Jordan, on year and a where exploration ended. and are then And fourth if But from kind guys. guidance, ask flat schedule -- on you again in at occupancy you a guys it easier an [Indiscernible] you And follow-up from had just way. commentary. 'XX. accelerates your ramps

demand context? back just basis see on for when XXX keep the growth kind you high you further kind that retention curious. of here, and to do of you guys I'm rent see get pick do up What in So back points, accelerating to side

Jordan Kaplan

and when lot got a time Because because not in out, leasing occupancy, occupancy you've in. of done, I them of I it's When rate. already always to I'm you'll know you're for because we're headed. doing proxy. as proxy, occupancy look seen than at it the takes is positive, end So where against instead gap -- a you're lease to you a leases occupancy. lease using when know gap move past, I rate can out which more rate lease we predict perfect more trying it's

feet year, meaningfully a about -- that two look Separate why asked about And we I that, question, ask you next if I different face. the we don't to our kind two doing I on two higher. or we're very slightly, slightly average into that think that from we're And role that think they years start the than of recover historical quarters. now, separate facing, numbers, this gaining three higher. know would for, It's XXX,XXX the It's it next very quarter the regain? you might or next be don't to that look us when I at the when I seeing now been years from you So the going of -- think when years those do we've with over I'm renewal. get strong we're leasing. guess not

know up do And and if in. me as catch the us what's so about That's catch we will leasing, occupancy moving optimistic I the what are coming. makes people

Craig Mailman

Okay.

about getting And to that just to not narrow what feel commentary rate necessarily to up, to better XX% picking you I want I so back be spread spreads you Stuart, to is try guess get clear. to occupancy. the guys the lease

Stuart McElhinney

it's get you when something. up we all, right? XX, to you or were certainly mean, make I at well, meaningful XX%, over X saw first of gains, like Oh, hard

And were we up. so still inching

of felt to least XX think the XX, you big filling leasing we XX time, like the going we catch was that down doing to down. up amount right hit we until have that because end occupied and churn spread to up as a a so where not you're I lot was people from recession. XX where of this moving on space now And, then we're shrunk have whatever. at way to had the of way as vacated new crunched saw in But would we your

Craig Mailman

you And then guys quick -- ahead. Go one just as one

Jordan Kaplan

we'll I was be Craig, but moving about just going on you're over push rate right. to we to think I able rates. XX speaking the leased ahead was where

Stuart McElhinney

rate. Rental

Jordan Kaplan

rate, rental On yeah.

Craig Mailman

Right. Right.

you program, the then you of what's kind back get on And talked as one guys about spend maybe you guys one of kind restart of XXX quickly that how to redevelopment just Okay. do had million annual the quick pre-COVID?

Jordan Kaplan

there. we're now Immediately,

Craig Mailman

Okay.

Jordan Kaplan

We’re doing it.

Craig Mailman

it. Appreciate Great. Perfect. Okay.

Jordan Kaplan

Thanks.

Operator

Our next Alpha's comes Bank Rodriguez of question from with America.

is line Your open. now

Elvis Rodriguez

morning, Good you. guys. Thank Quick question.

you cash I mentioned back two you relative XQ. the but rental to think help two to negative the actual statements back the Can you that made in levels, that leasing statement are spread? think -- us pre-COVID spread the or rates was renter about

Jordan Kaplan

you're rents sure multifamily speaking being have levels, residential, may pre-pandemic back thinking if been we to on for seeing about think our I that we're of business.

side, On gap rental would know pre-pandemic -- that down were as our -- the talking the expect you are you what's from levels. office don't gap? rates I Which

Elvis Rodriguez

gap a rents of Yes. heard Q, maybe level GAAP the No, I Well, on thought four spreads perspective. in pre-COVID were sort no. I that that were from a back comment or but to basis positive

so I to was just And trying

Jordan Kaplan

Oh, GAAP.

mean You GAAP accounting?

Elvis Rodriguez

To make between the correlation the two, yeah.

Jordan Kaplan

'XX compared as because at fourth we that's there make sure growth, comparison. the I the same-store a it's might like just easy tenants growth, not didn't huge no, if of and mean, are -- Yeah, comparison great mean, an paying quarter comment. you looking that I same-store period. to it's such there's you're I'm

number's of saying, than to have up. way more But with something risen. that So that's rents comparison do

Stuart McElhinney

like sounds the on office It misheard us Elvis, you side.

Elvis Rodriguez

right. All

terms Can about that you about and talk quarter-to-quarter are the higher then the should And year, or we what occupancy levels going until choppy what are. into be Stuart, the your market Stuart. throughout rents volatility Sorry mentioned seeing be stabilizes. in you get you expectations the and to of,

Stuart McElhinney

quarter rolling very have on plenty cash It's hard leases, leases we of XXX still -- predict do are But and been we of on rolling they've lot a to that up. because leases average, having do we a basis, down. we're a

spent what of depending more leases in the unsuccessfully get We've number where time where lot. you're can move move number doing, to what leases are quarters trying predict, sub-market really hard That signed. or seen we cycles see that can a actually around a -- that you predict So through lot this it. on to

But comment in rental this this point. not spreads strong So see being point moving overall the about follow that positive at was keeps surprising, as in Hopefully, that back glad we're now still it it's up. choppy. our the cash this with economics right we that at direction my the negative, to the gaps see bumps occupancy rent getting, spread those leases

Elvis Rodriguez

you. Thank

Operator

you, Thank Elvis.

comes next Steve, now open. Steve line from Sakwa Evercore. is your Our question with

Steve Sakwa

I and I as release, which the of thought in know guess think to mentioned one factors your serves Thanks. swing Jordan, the longer-term long Yes. term, were And XX% morning. memory me Good numbers, the rate. model I to press that the you we was seems if about the be XX, probably big me, XX. retention you in average closer to

just XX% just I'm curious, big to are what be in you you to the your So factor in occupancy. quickly that regain how of because can seems XX% terms range the embedding swing

Jordan Kaplan

and it correct so is is, that, So XX in retention our And historical XX.X, of above was that's retention, like normal our terms number like I said some can Peter my retention. but recollection me.

I [Indiscernible] it's or less was think XX

Peter Seymour

that. like Something

Jordan Kaplan

XX. I that and XX.X to loves will between difference. that big I a makes Rich know numbers tell be you --

that odd year. thought XX almost last we above it's So so far

so mentioned it. we And

back from XX our we in of next what your was, get do question is to that is XX leased how terms rate it Now

Steve Sakwa

-- Well

Peter Seymour

assumption our in for XXXX. for [Indiscernible] was guidance retention

Jordan Kaplan

dominate. high there out have It's so time info But averages in -- pretty what some much that and is. right about in We tend XX's as to a moving little might typically there's all at bit tenants always tenants many are statistically, the doing. the

low that it just to quarters a have look and high. whatever. of free say, quarter have four-quarters, can a get XX.X. you that's You very you off, then that But like block a that's extremely number call are have quarters, whenever can of hard of quarter way It's at very you

Steve Sakwa

Okay.

placeholder renewing? XX% as you've back-fill and of sounds like for you then for generally obviously not So got you obviously a purposes, modeling the retention that's kind of XX it kind

Jordan Kaplan

it's spent Well, that's number. something, I time our model what or is like odd said, I but Like out. everyone what suspect lot policy, comes guess is would very I complicated, doing, we've do. X.XX a probably sure trying of it it's I'm to an a but

Steve Sakwa

then second And question. Okay.

thoughts sites the with knockdown new for on sort development, or a are in starting mentioned You a opportunity LA? it's something on that your maybe here. of whether you in completed Hawaii projects What redevelopment or development residential Brentwood other ground-up have the type

Jordan Kaplan

we're since LA both we're and on are development is coming we're got back we're to together in fully saying Hawaii politicians working all we the working are, like this next, what the all is you're behind about talking we it. doing it and and thoughts it. We've and housing, hope to people talking the to the putting want office. We're My it, we're and all so and show on them, to pictures them stuff

Peter Seymour

think have Hawaii both in and in going I Steve, projects to And we'd like LA

Jordan Kaplan

Correct.

Peter Seymour

Concurrently?

Jordan Kaplan

Yep.

Steve Sakwa

think announcements to this the year calendar finish that it you it's period the sort these of or say, you could line longer next likely So gestation getting of than here? is have just actual the year

Jordan Kaplan

I'm I say. not mean try now secularly happen. to I announce we announced to I I'm right mean, it, because make going mean, would know of I when it hopeful some. that

it will we make places. both think I happen to

a Now, right I'm mean, I process doing it's long now. it and going. process such

So.

new answer is you working contractors So whole announced be it know are and would right end breaking artex cities as to [Indiscernible] these your to or talking now. and thing. have quickly you LA on we're And question are the I that [Indiscernible] guys year, projects near and possible maybe and We're have we in something. the ground doing -- we're if doing yes. as the of start but to in In construction don't the

Steve Sakwa

Thank it. you. Got

Jordan Kaplan

Thanks.

Operator

you Steve. Thank

John John, is with from now open. Capital line your comes Markets. question next BMO Our Kim

John Kim

you. Thank

-- at where the you lease of pricing the given guys give You any get year? the that leased power talked of by is think Can you end the importance of rate XX%. you the rate, indication just about the

Jordan Kaplan

we John is not to guidance on a of we're give guidance we? it on Obviously, lot rate leasing. to as up. hopeful the been go We've lease occupancy. on we're that really been are going good. guidance no, occupancy. which Where you we going doing We're gave that well. give, But has give to continues Demand

Stuart McElhinney

Wait, did he ask about year? something last

Jordan Kaplan

the at No, end year. this of

Stuart McElhinney

you asking the John? of this end at year, Are

John Kim

Yes.

Stuart McElhinney

last okay. year, but, [Indiscernible]

John Kim

would to last little that, assuming because took from quarters a take six at Well, to I'm way, just it in put lower get another take XX%. the you year uncertainty market fair trust did rate starting to of that to given what you're recession. XX. the and at year assumption, rate this this the it's a to end Is to from going you longer get you leased than lease bit recession of [Indiscernible] a last

Jordan Kaplan

going You're on be pressure figure trying to to rents? able when to we're out put

John Kim

Pretty much.

Jordan Kaplan

I mean, know. I don't

state the in I opening master I up. things But You really happening to am are know overly And optimistic see see then all like off opening here. opening optimistic what, I school. going. I want don't going the be next it saying week, think getting And and I up. and I mean, things that would kids wrong. and are stuffs be and like that are economy's the

office and we're card back I all out well. and all long, new lost mean your right she set we're and in. get that, being a her all maybe in while so was and as where card both I watched that home I parking for now of up in go, Now parking the extremely my I parking card this girl the elevator back morning it getting the

everywhere. So that's going on

Okay.

pretty that mean, been have the us of will on, know but over whole positive we I we've I the year like and we have good ahead seven a going pedal, through last that a play should where out. I'm whacking all with So really don't pedal quarters. year,

play it see out. to got we So

John Kim

is My next on Landmark. question and Okay. second

initial for being so and next contributions yield what occupancy presented, up roughly on the is can the Where is just what ended year model does which gave lease -- expectations. this for XX%. You development the we the year trend versus versus also your what your

Jordan Kaplan

extremely we it and that confident leasing build But seven, above So it's answer a we I'm we rate had have cap a said it. when that think the we for above already seven. we'll that's a finish

to and like only guys it's want I say That's at, leased wait where it, finish that plays above don't anything out, Do to that have for How where does end of I type say we but up? I as And having seven, it. a a see or? but so any I'd well I up, it's leasing quarter got because tougher mean, that don't we've trend to one. know. can you

Kevin Crummy

to Kevin. We -- this. lease We're X-year It's going up thinking be probably that it's on a

opening just we're so And up.

by should things year, end half you if of hoping. leased So as we're have go the the about

John Kim

much you Thank great. That's so

Kevin Crummy

it answer for you? Thanks. That

John Kim

Yep.

Jordan Kaplan

Operator?

Operator

Manny Our next with Manny, line Citi. question now Korchman comes is from your open.

Emmanuel Korchman

something. I Jordan, thought missed there. you ahead that jumped I

Jordan Kaplan

Well, I docketing ready was it. start to

Emmanuel Korchman

-- pricing about them now might you power everything to with we've you'll can fact renew come then making you the get pricing early people you right the but might renewing. seeing decisions. that you to the you've confident better tenant those tenants thinking be talked be and given have a surety it or Given XX% that whether with lock are it how the their that fact now, the power to that be if tenants got tenant of about if in are you Are

Jordan Kaplan

So yes, and they time just to saying, you've I that's for that at out? So and same the the rising. are our one ways us this us rising owe tenants seen to renew that's hey, spread coming of that keep happening. And can sure are money collections definitely

we things we have a we've are been the shorter rates? where where there longer I there's do pick in going, market. has leases, able in up. done much, leased but than the actually Now the market trying a to and churn the it and to second that line, way so market, we program cash never on we pick bottom tick the we launch press we game gains leasing always think positive that. for rate, or I We want deals higher for just better for top view rate. so the meet think much on -- do and we up, to a that And or I I we And rates off -- we're thing When get have do hold system since always don't to our at probably press pretty up actually basis

Michael Bilerman

Manny the redevelopment Bilerman a Hey, up, about development Michael you for ramp with here as thinking desire as Jordan, just and and of it's sources opportunities. uses follow-up, capital

well as those terms market. scour the about in As have sort much in capital of funding continuing to you needs. some to are How acquisition you how you're And looking do capital thinking goalposts mind of deploy.

to Let's say ventures value. I over sure list joint up. order the next leverage to enter And actively is this fund going to assets And two to high and your increased discount on stock if not sell its inherent where suspect spend going three or large to into seeking that's be not given But years. not to you're come in your from. its I'm take

Jordan Kaplan

first The flow itself to and cash new of so million significant my the $XXX Okay, goal after a free capital. generates a amount -- put company million dividend. we even actually between hope year $X of out

Somewhere in the $XXX million range.

Okay.

that we would you prices partners in are, the the their be list. venture all that beyond low getting where you're leverage we're number, the that That stated So have have sitting correctly that stuff joint extremely now would we is and stock on we're low of we on interested a have cash message, rest be the are and come money the where credit and lines obviously from and of saying right lot considering in.

Michael Bilerman

point? you to have I could working generate things. some to are on? capital good you're mean, means at time a I dispositions know trying Look, sell Do be to that more maybe it's hard which this buy, you

Jordan Kaplan

the buildings sell to mean, and of I last have saying, beginning -- we don't of 'XX. wanted well, the was I one end do I any that at Honolulu, selling? building maybe We we're sold you're if year,

Michael Bilerman

to other each days. these [Indiscernible]

the See Okay. for in time. you Florida. All right. Thanks

Operator

Manny. you, Thank

Our Blaine, line next now Blaine comes Wells your is Heck question with open. from Fargo.

Blaine Heck

Great. Thanks.

and to and given profile Just high your follow-up NAV, on that cap side rate. discount leverage meaningful of and your the implied that other that low take maybe question,

but However seen it. on you know at this bid acquisitions prior the you've you've recently. kind to look calls, lack I an for And of on update. addressed want of that on sense for keep Jordan to the opportunistic you to get it make the powder development active dry and or you other that about do in Does might want come acquisitions buybacks share future. think here just that

Jordan Kaplan

of Well, I've believe been I our -- I obviously and complicated you say, business no about talk the I you're market stock because stock. -- mean, stock. been buying participating our company personally I going. be buying the a the when good our a it's there's in don't is I'll to of and isn't much and buy. stock right, where the our company, stock more and stock's decision, guessing But ups But tax. downs very the market

think the of and frankly, to lot by it out. a I wow, killing Our business times stock goes is let I'm run and lot I other and it, down a then the goes real run And itself. times and think, what stock estate we're the when stock wrong the market

I'm think that don't I that. So predicting good at

that. with start did So

means back that may and it's or a buy things unless [Indiscernible] Secondly, you're something, complicated stock. you're your because But be. it's not you away the for have opportunity development these de leverage or that I to other the it increasing selling because whatever an decision stock acquisition of you're you're bought back do our wouldn't taking ever some facto,

little be -- So you that's a thinking have idea. not just good a to it's really

projects. do an you're can in the the buyback redevelopment stock obviously your now You've be with stock in acquisitions got to when range reduce choose it market. or be position or leverage, the extreme not that raise to projects, an to then your expert you And development wildly of things

-- being us. a why that's very So you you why see don't it activity really That's see rare us for

Blaine Heck

businesses. second studies. when your they their that's were can to any your I of know just having inflation talk helpful. that businesses or the and these probably to the business different optimism wage keeping And January, the are question, talk included kind base lot in than that smaller even erode costs struggling then costs in a up small your was rumors that's increase health for trouble average numbers, heard of business are release Okay, around with tenants? some in you and is for in you hearing the you But inflation? associated saw increase small the handle underlying tenant that tenants, We we my of rising about commentary

Jordan Kaplan

in probably So I that's think the case. small retailers

embarrassed Although hasn't I making this at anybody and even of healthy think saying us they our be their much they're paid rent. office that now think you're pretty point, our should I tenants, actually retails but how money

thought that's The the you not majority employing been These their money they're is case. hedge in firms, they companies that expense that's managers, the know the about industry mean, people definitely and employ, I'm not cost but run firms, live wealth managers. feed asked, not this still that these colossal with So off that question I have paying they people, there. in people company of area. the rent on they've best laughable housing goes, law absolutely that almost and not be accounting all It's than the their making advantage I and making small have would And of list of around take that. years, with fund their absurd some this how it having Wildman is making. money they pay to the tech pissed entertainment much industry. and whether to

Blaine Heck

enough. Jordan. Thanks Fair

Operator

you, Thank Blaine.

SMBC. now is Rich from with next Our question Anderson line Rich, your comes open.

Rich Anderson

there. out morning Good Thanks.

but for a statewide tenants sort any rate. and some wondering as in would lease accounting level paying, about your vacate and expecting you're are making some ramp your range, of about I expecting, but range what stuff I for of think that, might hiccup of they time continuing. off, know allowing comes, in the excuse actually, you any that said you year? know now, the some the me, moratorium you do allow thinking know eviction that that they're money when not I occupancy? For this behaviors despite I'm you're perhaps you're for guidance still burnt of you what in

Jordan Kaplan

that That Certainly things the could allow the for lot happen. range could of list. of be the width on a

side, the at -- that but see mean, don't likely residential think I but it don't out. meaningful, side, the on And right plays some side, that's office the I looking as office on that that necessarily more of might being to I I see we'll happen now happen.

Rich Anderson

to big lot sticking I on Francisco of attention a talked at expansion where and that question, dislocation right your about spending But you're days amount days these markets of these is any don't detail. then a now And about going are San got you if within. from any that's or ever in know picture market anything specific you've there

Jordan Kaplan

surrounded by And edge at I'm money the rest Probably the like actually would money moment That like I end, to San the it be be are though all the development. are colossal additional to number put a I get whether institutions, know effective. and an values we at set into them. are also values for. we're that incubator think of sure versus because mean, that in Downtown my that the think to our and a not what off, that we would it's with comparison of that I good trading we'd of money. not fundamentals But Francisco in Francisco for here now I'm know right or and up separate and off so putting even I acquisition how stay in is be of self-inflicted. terms from far -- opinion, argue just reasons, returns I [Indiscernible] Francisco a sure the to able San here, lot in market have have what still to local to whatever or in it's San Stanford in here, stays out ILEC and CAL going that of on there issue way

I or think -- it's type some like don't it's don't think market dancing of grave anything. I So

Rich Anderson

Good Okay. enough. Thanks very much.

Jordan Kaplan

Thanks.

Operator

Rich. you, Thank

Our comes next with question Bill, Raymond from your Crow is now. Bill line James.

Bill Crow

sub-market guess, the to crime as in be market? seeing borders going are keeping from goods sub-markets, guys. Similar guess. play morning, that's expanding all but cetera. ago out Good local, et LA change long guess Thanks. It versus struck perspective? I the the challenging the on How my much how on evolution you I you its what's do question areas. a of going in I sub-markets is, was it I to and of on in the too focus news it not seems question, me about Rich's but

Jordan Kaplan

actually tightened the Well, would up, the have but to lead in expanded. you that your cause think answer have me I borders boarders want

great I the where ago, the the certainly Culver out not us, say out Vista may these living it's some I all to where built City most way hot where concerts And decade in City have good. would a South classic and that are the now to and included the a if Hollywood, working. certainly Playa think of a I kind go and very border border maturing you amenities it's of have down and have certainly near Vista because markets all deep, that and So whatever for always sub-market being considered Playa now or the East of part market. or but go to West area would they're to also as very people a development, is market Culver are a I that you it's of out lot

also that's I So strong think. very sub-market,

up get you know east like, call West-wood. would what of As don't I to you

market expanded. I also think that has

with I think kind like The of that what is a deal big on did Pico we lot it. going Google. to around incubate did Victor over

instead like contracting. actually So I sub-markets what's of expanded think good West considered L.A. has

it. and some order I I recall everyone about I are state again. Now, that on misdemeanor, going what's us markets GasCo that and kind shift look, that were the year. crime our and hope back dealing this talking that's law repealing and a The, ballot see just probably mean, are made the in is things smash talking way we'll there's structure. when and the now going grab, behind on not to of the moment running -- is and see but crime to on, with left very aggravated the and law politicians say about about what's and far happening in order, extremely not even I see a never lot legislature's to [Indiscernible] which of time

about So talking, specifically, across you clean now people In I'm are and up where board clean up, for at going. running here things it all mayor council, optimistic all are when the home. pretty the county, California, those the look

the up crime. clean Let's

that going loaders. in they're think they I got the the all message So from

Bill Crow

appreciate views Now, I your the always on city.

talked And know you in about sources a bring capital Hawaii updated doing the talked years, Just look I'm joint I it's or and what on there as JB Hawaii? before. been a before was and several all but big of table follow-up, are venture at off this uses that might in a point into off thoughts money some LA just the together back that is the wondering at your and you

Jordan Kaplan

going great is -- leasing time doing residential still I in the was to office building could back bring Hawaii that thoughts My to but like capital with I And I And is investing money -- doing actually star. do money you it, some making and more would think are the Hawaii. believe but about when excuses for right to there. money I I'm talking is the bring cranking remember cranking -- the complete it's right mean, a out Hawaii back, there now opportunity, our been obviously opportunity has Hawaii, and I great. a and also I

Hawaii So. I love

Bill Crow

guys. Appreciate. All Listen, Okay. thanks right.

Jordan Kaplan

All right. you. Thank

Operator

l. Thank you, Bill

is Street. open. from Our now Daniel with line your Green Ismail next question comes Daniel,

Daniel Ismail

Great. XXXX recovery parking if revenue in of guidance. embedded in is Thank Curious kind share you. you can what

Jordan Kaplan

over you answered XX% would we're revenue, at of be utilized That of we're So your full XX% our [Indiscernible]. is question? parking that which we're telling over one the why what if is it comfortable reasons

Daniel Ismail

can you up a that think XX% either I anticipated to percentage its year? with get utilization of be throughout Well, the

Jordan Kaplan

we almost you think the Stuart? looked last it remember was I time Do at XX. Actually, it,

Stuart McElhinney

to XX% recover we year. mean, course the But of the for think how over I the what occupancy adjusted you're it's it over asking Yeah, before of was pandemic. it's going

Jordan Kaplan

to is XX the you're asking? the what that mean You XXX,

Stuart McElhinney

asking? how And that existing and -- it's when utilization mean how what going to Yes. and That's then people back the think to fast happens. based they're coming of I I XXX% on I back mean look, he's office that's occupancy, fast the to

Daniel Ismail

Probably to I that was my question? revenue just relative just XXXX levels, parking meant total

Jordan Kaplan

Right.

and they lose So occupancy I have would mean, the adjust XXXX. for you occupancy to since

expect we that we're saying what we're at XX% back you improve, for the on but based back to somewhere then and the occupancy levels. Coming over to to it's occupancy, So all office existing now is adjusted attendance.

hard to of to play expect the how year. better. it's predict over So that's But out we to get course it the next going exactly

Daniel Ismail

potential I'm the and November election Okay. you are potential on on that's is that something [Indiscernible]. if And property up XXXX and curious team cross, challenges lock you an ballot in we wind Jordan. might for year me, challenge. guys another team caught proper any expecting have guys

Jordan Kaplan

the union about nurses’ You're Northern in talking California up

Daniel Ismail

not to about -attacks what about of is exactly subject it's one, so. a Where over X role, property X% of cyber but million or

Jordan Kaplan

what your know that's right don't know don't happen going much to it know go to what's that. seen -- I I I It's Did where discussed Yeah, whether I I don't they're question? at I answer haven't going than it, not are to know that actually they that's farther now. them,

Daniel Ismail

Okay. Appreciate That's it. helpful.

Operator

Daniel. you, Thank

Elvis with Rodriguez from of next question comes Our Bank America. Elvis.

Your now line is open.

Elvis Rodriguez

to on good lease-up space Jordan, finding competition and they've are year. in obviously you curious last go you them today, just occupancy WeWork thoughts success Co-working. this I'm And your growing follow-up. on some just be quick a as had

Thank just curious you. So thoughts your on there.

Jordan Kaplan

business we're what sort they have. we don't all, not -- ton think of call of out We're that enterprise they build the sublease and -- entire don't -- them. to I And I their takes enterprise. forgot I their it's And haven't part space. of No, first leases businesses they we-work's the to Their that -- I -- a secondly, of in in. markets -- there's the

X,XXX haven't their feet. or for at that our they're to I want direct that and but -- the think no. to They they tenants And easy money, seen want whatever go of maybe we just as or own them most actual space. whether XXXX pay all,

Elvis Rodriguez

the website X% the about markets, space chunk of a in We think is of huge our space on co-working not only it's

Jordan Kaplan

not piece a it. it's Yeah, of big

Elvis Rodriguez

guys. Thanks,

Jordan Kaplan

Alrighty.

Stuart McElhinney

else? to Anyone lost I seems Michael else? answer. will have Operator. Anything we It our Operator? guess

Jordan Kaplan

you you. with good speaking so speaking Thank don't you we questions, next have forward we further believe Well, all and to of with any again quarter. I look

Operator

quarter Emmett fourth earnings. Douglas the concludes XXXX That

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