ROIC - Earnings call transcript Q3 2017 | Retail Opportunity Investments Corp.

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Operator

Welcome to Retail Opportunity Investments 2017 Third Quarter conference call. Participants are currently in a listen-only mode.

Following the company’s prepared comments, the call will be opened up for your questions. Please note that certain matters discussed in this call today constitute forward-looking statements within the meaning of the federal securities laws.

Although the company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, the company can give no assurance that these expectations will be achieved. by known cause risks, materially actual results or involve factors and from statements and expressed may statements which results implied forward-looking and uncertainties unknown other future expectations. Such forward-looking such to differ Information the filings regarding Commission, its with in report annual Exchange company’s most and such recent factors Securities on described and including risks is the Form XX-K. and company’s more refer to the and such risks with information results. the SEC for as the filings to factors company’s encouraged well are financial Participants operational regarding as regarding filings can company’s be The website. found on its

to Now I Mr. would company’s the Chief Officer. like introduce Stuart Tanz, Executive

Stuart Tanz

Good morning everyone.

with Schoebel, Haines, our Michael our today Officer. Rich Operating and Officer, Here Chief me Chief is Financial

to Year the acquisitions, growth report pleased We centers post had to are solid track that portfolio. company and terrific have nine year to of date, of million strong our completed $XXX quarter, we performance. another shopping to grocery-anchored another adding putting on us

XX portfolio With foot these our acquisitions, mark. new surpassed has million square the now

in the to grocers in operators, located diversified, XXXX, Natural PCC grocery the two in nine in nine in Angeles market, organic of shopping two Orange and industry as anchored by that Importantly, now in grocery-anchored specialty Kroger. the San a shopping Included we we we The is supermarket. is with latest Of are the balanced diverse Safeway acquisitions productive acquired one in the located as XFC Pacific from Grocery one mix geographically Francisco-northern U.S. centers Los Seattle, the market, established, grocers property shopping residential far like that Trader the Joe’s, heart thus and are for number by relocating. County. with our which is is Northwest Markets, value according destination to the ranked and Outlet California leaders, top in in in acquired grow data census the being people center of just highly Along a to ranging week established with like a geographically bureau as centers anchored a continue terrific a one last nine and property the located acquired four well three have and well we are such centers in manner. the located five an city California Seattle operators in in Kroger community portfolio Portland, our

$XX thus also Beyond acquired grocery-anchored far shopping the another County. million, located that for we Orange have $XXX million we center great have XXXX, in under contract in currently

with Seattle the is residential densely Orange acquisition, new community affluent XXX,XXX of household over a center people of income a and a this As base $XXX,XXX. our area County ideally heart trade in with population populated, located of

issuance of closed through in the of we the ago. center pending funding part on ROIC Additionally, is of the the acquisition equity. roughly property weeks are transactions County million The instead two shopping seller few common the from coming $X seller but Orange the from million that a $X we of not

goal seller $XX.XX the ROIC on were coast, currency cash also exchange XXXX two a of execute to property stated will not our the outlook currency transaction, of Once XXXX the a take Orange that meeting reach our pending the total did they year. on activity had total located which acquisition on our million property and based the two that have addition Through strength took goals In County of our of $X strong XX%. and west to addition with million a a the if $XX share, keen in however, properties, meet, in are at rate the our properties. acquire; the to on surpass, business we leasing. our the value of to acquisition lieu portfolio wanted seller we not forward. meeting of ROIC third think the that lease very also terms we track for they of ROIC operations of maintained Along The XXXX, for the a not going $XX taking we objective a $XXX regarding that we fact million to on first for XXXX, of million, nine was currency speaks of close sale months in

of the level. with on which our that terms we strong year of at first occupancy, today each the year. XXXX achieving on in double row post above a XX%, third to maintaining are of releasing increase quarter, finishing high nine track in new in As putting to an year months XXXX, third we achieved we months space the a two we in finish increase be Through XX% a fourth of Along track growth rent on year on including year, digit with our our same sit XX% another also here spreads. at XX% leases, post would left consecutive our track to have increase are very us

X.X% on terms year thus of growth. another far. we in nine to center of to increase same NOI, Additionally Year of XXXX, date first through months track we are again have achieved the post a

center year a take rent our towards previously, of As occupancy anticipating new that growth we accelerate. number would have such been and end, discussed same NOI commence would we paying tenants have

represent to same taken fourth same achieved, We center at in many for third strong a quarter, these of center recently expect or tenants report growth consecutive full year occupancy NOI NOI our posting that the growth which, could X% X% have are pleased if of higher. here would of our year we reach whereby XXXX new

through the our over Michael to turn Mike? you financial Haines Now take to call I’ll results.

Michael Haines

Thanks Stuart.

XXXX, $XX as third of $XX income quarter net million total million of for the of of XXXX. For the share quarter per to for shareholders XXXX the and compared was operating common as September diluted revenues in to equating million, $X.X per for to the $XX $XX the attributable to diluted in in or compared million three income Net quarter months $X.X XXXX. XX, $X.XX revenues ended third total and operating share million $X.XX had income million third income company in

first In operations third the third million our was quarter representing $X.XX terms million increased funds per from operating million of $XXX and Net for to the per-share to revenues the With income million $XXX $XX.X for of nine total per XXXX. XXXX, of first FFO for income months diluted income performance million FFO or over nine million the share compared months of nine the $XX.X XXXX. XXXX. of increase to XXXX. of quarter for total of XX.X% million $X.XX On months XXXX diluted or revenues the quarter as XXXX, to quarter respect of for compared of net in total third an FFO XXXX of the of third months company to compared $XX.X as had basis, of a financial and the the share of for as million operating for first $XX per in nine $XX.X income $XX first $X.XX totaled diluted share,

diluted the FFO $X.XX total months for In for had or as million to of per of XXXX total million per $XX in nine first $X.XX $XXX months share XXXX. terms nine of share FFO, or company first of diluted compared the the FFO

outstanding, the had total with debt billion XX.X%. capital to of Turning company approximately roughly a total to $X.X market the a September ratio cap company’s billion at XX debt balance of market of equating $X.X sheet, to

the In of third recast terms successfully initiatives, during term loan. credit we our financing quarter line and

and $XXX the million our to the capacity line loan, of extended to we be approximately to extended we date four years $XXX could feature accordion five $XXX XXXX. credit $X.X maturity maturity credit line Specifically, billion, date on million, now to respect to to from our the XXXX. with the years from approximately increased which to unsecured million the from term we With increased now

interest our term additional with Importantly, that on we we rate $XXX $XXX million entire million have fixed existing totaling loan. effectively million our agreements the together entered interest swaps, swap rate of $XXX now into

XX-year private of notes, the to we senior of lower a we unsecured are in proceeds million the Additionally, also use $XXX of balance. which line credit stages fixed final placement our rate completing to plan

taking placement year account approximately swaps, end. total into close to end debt this note Accordingly, rates fixed expect with expect will we at our new of We that private the XX% these together before be year rate. fixed

towards our to Lastly, the into year. of account in currently stated us recent the and terms to $X.XX which our operating previously put end mid full financing between for share, high diluted be expect all quarter initiatives, we acquisition, and fourth per FFO, of taking range for would the of $X.XX FFO

discuss I’ll COO, the property Rich over to Now call operations. our Schoebel, to Rich? turn

Richard Schoebel

Thanks Mike.

scheduled already putting was strong new for leased than more the to year track again As annual track us space, set leasing on to feet to Stuart to double originally potentially the Year front. entire year, a post to track highlighted, volume. putting leasing have on are to million that as in the well amount of X company on as of date, on lease another record we very we close once us overall expire the of terms space for square

high leasing our ability to portfolio. continues occupancy Our ongoing our across activity to maintain drive strong

just Breaking anchor strong leased high at are at working have space, our that taking in at year flow we end XXX% at at rate XX that always XX% or for we very we take leased. but we with a and that and consistently is every As year work that Along row higher strong hard pride a pride September Bear track which also at our hard between XXXX Stuart level in increase level. XX% shop something our are quarters at on at XX%, XX not working finish lease cash at a portfolio down now, and maintaining hard to discussed, opportunity. space very high fourth occupancy space shop our very mind stood was to with consecutive been occupancy, anchor a and our in.

on track initiatives. As Stuart another strong to we rent are growth noted, of our releasing year through post

quarter, our square new achieving cash increase space we a base included bringing on space, basis. feet, Specifically XX XX% portfolio XXX,XXX totaling rent a into feet XXX,XXX of leased in square which comparative in the third tenants

a XXXX, of far, during terms renewed in XX% renewal space activity, the base of Through total and leased, the the With shop focused anchor average renewals first of of on XXX,XXX have an our X.X% feet, months nine leased XXX% new predominantly In of year feet achieving increase a cash space. blended XXX,XXX achieving increase new on square quarter increase activity we tenants thus been year. XX square about third this XX% the on bulk we rent. totaling on for has on our a fully leases leasing

are relocating example nearly tenants, to shop tenants to space markets stores space significant some most mind, work often our new as across tenants. in full retailers, heart spaces, shop lease of expand we in small to rent those our notwithstanding national ideally are and to is speaks into like our achieving proactive well, elbow of our involves to of creative, regional where spaces looking creative Bear variety that establish new the including and being our are our for These having which properties order be on underlying a in still strong the last, to the for Given situated. affluent communities combine portfolio. increases, part, specifically accommodate activity hard demand

Again, expiration bulk year lease and schedule half primarily contacted proactively the XXXX, well activity, exercising relates of have renewal leasing year been or in markets the this advance options, we XX to anchor of by in been to next strength month looking scheduled think actual expire, and anchor of speaks anchor renewal of the portfolio. has it next of already dates. volumes it our those, at we exercise this tenants current two, expiration leases the their as As to the to in seeking about here options our

flow of given economic leasing in continues the be Lastly, portfolio. activity meaningful growth, our embedded space and and the spread our ongoing growth and rent cash to build lease of between all indicative

basis. rent third quarter, the spread roughly stood X.X%, of on at of cash $X.X annual start about a the at representing million the additional Specifically

account During spread approximately million. incremental in into of started third million September $X.X XX paying our that of X.X%, activity third quarter, of together quarter, million the the $XXX,XXX was third million rent, leasing $X.X representing the tenants with Taking the quarter. was as approximately which the $X.X during received representing $X.X

the turn to Stuart. back I’ll Now call over

Stuart Tanz

Rich. Thanks,

quarter, $XXX fourth for summarize $XXX Just to in which acquisition we our to quickly we’ve the to works and have total acquisitions currently year close pending million. the what the expect in $XX million closed already million the will here of bring soon,

$X the over the turn in that center NOI quarter, In are which track on same in should year. accelerate based growth on additional million of fourth leasing, annual we’re at terms our in occupancy flow tenants taking cash here for

capital. We busy had underway also final on will expect solid of In debt and for million short, we’ve $XXX new quarter productive complete equity company. to year and close that another very a the

expect the row commenced towards achieve center Additionally to our a for mid a range, we achieving operations our end dating as of single to full FFO high to when stated, shopping every year. growth we Mike as in year year FFO back the REIT of eighth representing

are encompassing because to portfolio Looking demographic and continue million going well track the shopping that not strength are capitalizing owning XX most taking three, set grocery-anchored heights to country, coast. our properties including of XXXX, and important feet protected, constrained over we to also our together, among only believe shopping they’re and building the on positioned to square markets San firmly acquiring, of two, steadily apart, strong from in highly their markets successfully continue which Diego center among the our ahead today coast we the strengths grocery-anchored record because in one, value All the the three that our spanning at Seattle; we but west company economic intend us core west and centers U.S.; XX supply attributes: best forward. on XX-year totals operating which new

for will Operator? call open questions. the we Now up your

Operator

of is Raymond [Operator instructions] from Our of James. line Mings question the first Collin

is open. line Your

Collin Mings

Hey, guys. morning

you can debt quarter? bad me, recognized the question expense on from the expand in First

Michael Haines

Mike. Collin, it’s Hey

our I as business. being kind Our that third as bad because fluctuates as if we next from was quarter, of debt describe the well to to the ties of directly something line is one tenant specific that something course expense during outside nothing the normal in quarter see horizon. it quarter activity of on There would the

If of a you more consistent on at you’ll look see pattern. a it yearly basis,

Collin Mings

kind just activity, or particular, there you’re is point, in nothing your something horizon, that so Okay, the on of about? normal to concerned

Michael Haines

of course business. Ordinary

look bit end on it last makes comparative was of from unusual what quarter the think a that low I little the is year $XX,XXX.

Collin Mings

Stuart, very but facilitating forward, active cost several last Then over market, about still years. think the fair. we just that’s the has moving key your your in clearly on of as clearly growth been Okay, equity acquisition external

the on over rising to, has pressure the relative and for a Just ago, price deals levered how appetite it? given the or metrics year say, changed of stock your kind last year, has

Stuart Tanz

the We for continue to look opportunities as we in past. have

continuing are as to we We have. be as selective

watch probably to go things being continue performance really and of it our it’s as market we’ll watching the go in stock relates patient balance dispositions and think we’ll the sheet. into ’XX, to issuing now but right I equity some the accelerate terms and we just how see of as

Collin Mings

on just Okay, outlined the Stuart, Can far last and into update quarter? your then one that just and maybe us accelerating me, XXXX. as one you comment transactions the as from planned last just on you dispositions

Stuart Tanz

are Those we other additional forward second. but speak portfolio. at, to terms we proceeding and might assets pruning look of dispositions, continuing to There are that are look the at Sure. this of in nothing

Collin Mings

All right, over. it guys. I’ll turn Thanks

Operator

Thank you.

Our from McElroy next is Christy Citi. question of

is open. line Your

Christy McElroy

morning Good Stuart, wanted (indiscernible). I just to everyone.

Stuart Tanz

You know you. what, having We’re problems Christy? hearing

Christy McElroy

(Indiscernible)

Stuart Tanz

garbled. it’s No, all

Christy McElroy

that? about How

Stuart Tanz

That’s much better, thank you.

Christy McElroy

no problem. Okay,

X%? How of your like achieving to ramp tenants now sounds same NOI number? lot of in that looking realistic, that your which and year you expecting last of of leases in, and confident sort X% same baked that NOI store in we are in in X% inherent in should That more already comments think what’s had the to that’s regarding ramp to said QX store a end were spread begun see comments bogey You for I full pretty about already late commence you just it sort year, So us big is be a next that many think growth you in have reaching represents and for QX, about the QX to lease quarter still quarter. a growth. commencing so what move at given

Stuart Tanz

same looked growth. we’ve the store mean, at I Well

robust that, That’s as the bit about for are number in not that making of the I should third getting of as as the in now our but delayed in it Some tenants the sort same good quarter, what these of late the store opened we good articulated confident call, opened, have year. is a portfolio. some the drove were that are been with pretty now in we we are news open think feel some here today of that sitting anchors NOI

are good of terms we’ll continue in pretty fourth that continue percentage relates terms other deterioration sitting the rents, any is so the quarter as as very make quarter number. that that don’t in the to strong sales The thing we it to fourth here be and monitor we we’re there well, see to news that of so confident today

look we guiding the we’re hard as benefit you not at we and over really--you done run and in all rate finally looks full reaping ’XX benefits of get importantly strong so leasing of repositioning this terms last again, quite all of ’XX, full know, we’ve More a work, our year. but a ’XX, yet the are

Christy McElroy

a store back how spread mean, obviously about same that’s comments, going modeling or just a seems be from of wider, following growth. perspective, peers, structural Where is that, year lot always up your--that driver I what spread, if is big NOI that missed realistic should we going it expect thinking because level that of a on end, that in a and a to for sorry inherent I of so it sort do just XXXX, today? if to something it has it, wider many commence I’m you that than your there’s what’s your lot you a into will lease to So like just wider be tended be to wondering be narrowing?

Stuart Tanz

way offense portfolio, Well, that’s terms in we’ve big the of very leasing. our so driven playing really been in a what’s

I if terms over you Mike, want think to rolling articulated, on year. to to As for double Rich the the that, lease was know we’re what of spread? I don’t in add track just

Michael Haines

of always by starts and I as place, number time. June as I expect gap anchor that to going gap, from narrow end, of know further. will naturally over be though. to it’s spaces, narrowed narrow Well, There level even take think today, don’t actually should that just where the I be is that year some repositioning that and to the going

Richard Schoebel

the your answer at was in, the from depends down it about but it that on is question, though, To signing $X.X within end also at of leases we’re the coming quarter. quarter the X.X, million, so

Christy McElroy

those Then a perhaps are disruption, market buyers private with grocery real noise grocery Okay. risk last business. the competitive deals? around underwriting more concerns filter some talked obviously in bit the landscape you at any Are of a grocery about into lot of of just perception the into all lastly, seeing there you all quarter, but pressures that (indiscernible)

Stuart Tanz

at all. not No,

Christy McElroy

Interesting.

for it That’s me, thank Okay. you.

Operator

Thank you.

Thomas is question from next of Our Markets. Keybanc Capital Todd

open. is line Your

Todd Thomas

morning. good Hi,

just just recent in sticking of seeing if you the and and acquisitions, terms the change news was into bringing some just just market, on sellers ’XX, the I wondering wondering headlines heading forward if grocery, with the to surrounding product could you’re I Just grocery Christy’s any given of pipeline industry. just was here, question light going shed some on in

Stuart Tanz

and always, bit to guidance call; going as early in be continues on a it’s next for general, very target we’re conference pipeline to set forth provide our a to ’XX, but strong. Well, the obviously

Todd Thomas

go Okay. I wondering--sorry, was ahead?

Michael Haines

your question of was--? second again The part

Todd Thomas

the product you’ve If bringing in change sellers grocery any seen to market.

Stuart Tanz

on terms to the in quite acceleration off to mean, sector. given more haven’t the but seen grocery I that market the the there relates store No. be it than strong, we we in overall out market, noise of centers, primarily market flow hear as anchored an continues deal grocery

Todd Thomas

portfolio’s mentioned that that XX you Stuart, Then size here. over now square mark, foot crossed Okay. the million the that you’ve

still - company level handle manageable for the way, size is means ROIC of you that the the in with the this where you portfolio’s attention? to for the or platform do what expand same feel to curious and Just team needs that reaching some

Stuart Tanz

it’s It’s grocery still had so primarily sold mean, very when XXX we’re all company, portfolio. certainly offence. XX Pan Pacific manageable. feet we and being the shopping the Again, continue to well have portfolio really--it’s anchored, and at the centers, XX% we so about the day we ability drives million that leased, I when feeling play good every to leased, blocking value, the with tackling really square you’re and

Todd Thomas

Okay, sheet. the on then a for Mike question balance

about some the in You the talked quarter. activity of

leverage, reload ’XX. about for Just strategy of sort balance, finance line reduce curious acquisitions the the to permanently here heading and into

Michael Haines

for financing and the the placement obviously term out our revolver we’re in (indiscernible) I initiatives put further and that’s stagger of $XX So through out equity going currently pushed schedule, million closed we a the to various that maturity revolver XXXX. and the equity. to mentioned the and the to (indiscernible) We other issued of raising evaluating relieve just loans finalization opportunities we’re private

leverage now of definitive very level discuss today. mindful as but to We’re our well, nothing right

Todd Thomas

expected the you Did range or comment that private placement? around on Okay. size

Michael Haines

is $XXX transaction. The private a placement million

Todd Thomas

Okay, right, All you. thank great.

Operator

Thank you.

question next Wes from Golladay Markets. RBC of Capital Our is

is Your open. line

Wes Golladay

Good morning, guys.

growth the tailwind leases at the it kind XXX next pick-up blocks of quarter there regarding on going just date, from commentary points you’re Looking those a I’m mentioned was have a from the a going been about but paying recovery should year, XQ drag wondering on to when last I’m lower, basis commencing, ratio you’re to work and the that - see year and little bit for of get a delay recoveries. bit tenants NOI to wondering you building just

Stuart Tanz

view think and to vary will think quarter, is new I I of some quarter my that acquisitions-- Well,

Michael Haines

their way the process. work property (indiscernible) which Certain through related to bills and taxes billing eventually

Stuart Tanz

That too.

Wes Golladay

guess a to that or NOI for that lag? year a is of still we I be a all--the expect lift basis drag, bit be to point going there XXX growth, with little should next So

Stuart Tanz

look when really is In and terms that periods XX at the days. time lift, of of every haven’t basis XXX unusual fluctuated a you our rates it’s mean, of not points short to--I much, recovery hard

going a roll In next that. that--we don’t we we give to as into are many recovery I’m assuming can have turn triple gross either leases more opportunity probably rates that that year, roll our that better they are to or these, leases, recover recoveries get that of of an where bit the stay maybe that us terms continue will or are to

Wes Golladay

I calculation, yes recovery I a if The but sorry, The points Okay, my to XX%, - you XXX points. date, points you on basis down misspoke. NOI on lift, XXX actually maybe was is get ratio basis was down thinking so drag to just impact the XXX and got based was the just that that. more year trying would of get towards a bit the timing little basis

Stuart Tanz

issue has again, you it buy is fluctuates timing that different the NOI, more center overall doing. an and this recovery acquisitions quarter quarter a again, to recoveries Yes, we’re so every really versus to that’s issue; why this of amount the as shopping relates of with

Wes Golladay

noticeable year? drive any do have leases market thing at other looking you next results, outsized then could that will and below be the that Okay,

Richard Schoebel

No, our--Mike, don’t think I not to so?

Michael Haines

Well, I the portfolio spreads be footage the lift terms expect generally we what normal in releasing to is that’s think square speaking, lease consistent rolling-- as with roll, across

Stuart Tanz

Right.

Michael Haines

that across portfolio, lot going are below market of you’ve --because turn. to a got the leases

Wes Golladay

Okay, you. thank

Operator

Thank you.

question of Bank Craig of next Our Schmidt from is America.

open. is line Your

Craig Schmidt

then XX% California. Pacific looks just maybe wonder is versus the be this this of Pacific Thank market Northwest description you, to about your in think Northwest where growing, on could good some Currently you I your and the going, transaction be ABR. exposure morning. if

Stuart Tanz

the into our at looking in depending the future, are on portfolio diversified. Sure. keeping but growing the acquisitions focused Northwest portfolio geographically Pacific we importantly more Again, on

changed rates continued is to--cap and the In terms have that of thing the Northwest, has part market it in of quarter the and head valuations west acquisition up cap down have coast. head of rates to to last really--the Pacific that that continue sort is from continued or one valuations

the seen really the California time dominant Northwest affluent centers cap since on in areas. in of operating we’ve in drug-anchored shopping grocery, west for rates fact, In approach never first the terms Pacific coast,

today relates we on both as to of Pacific in are the We growth. thing one that some of gaining still valuation interesting that’s don’t that what’s in the best that growth parts locations seeing now. par dynamic actually as demographic more one most right of Pacific changed most--with it the the is it terms with the almost so and the So is see relates of some of really It to U.S. Northwest. traction Northwest California, changing and income is is

Craig Schmidt

growth rental seeing in would faster they’re versus revenue you or the Are similar? spreads you Northwest California, or say

Richard Schoebel

varies property I it really and terms fairly in market property, the depends was set, similar. that think lease they’re know, that’s to of--you rent, when the expiring Again, but rent on that from to region region.

Craig Schmidt

Okay, you. thank

Operator

Thank you.

next is Advisors. Capital question Green Street from Tibone of Our Vince

line Your is open.

Vince Tibone

anything the in any to on cost, Good the Crossroads you morning. lines? point along more Are timeline, Can densification general process, general at you provide of opportunity rough Seattle? entitlement those details able give a sense this at

Richard Schoebel

Sure.

continuing we have we Crossroads. along what Phase the Phase up to and call So at X X move

of The to estimated to break terms senior an ground track XX-month to Phase he within is In progress regards project. days, city, to recently XX and have Phase has the with begin on taking X, XX senior our Then housing paperwork pre-application that’s we housing X, next developer and submitted to the timeline. is to in shape the that begin--have just construction occurring. we XX XXXX, expect so

Vince Tibone

ownership the owned? portfolio, that just to to in be party or and going clarify, senior housing you Great, having third is are

Richard Schoebel

party third it’s owned. No,

feet retail a We’re we’ll back square the few essentially getting and floor. leasing end build to thousand of development, ground actually on ground up him the the to

Vince Tibone

lenders now equity That’s talk bid private Foods that me deal? still but It have great. from you cautious the there is One - Amazon-Whole Okay, seems about helpful. for more any the following can more strong, pretty the centers? financing grocery-anchored market become

Stuart Tanz

lending. haven’t Mike, our can mean-- perspective I the mean, you really in answer much terms question. I of Well, seen probably we from

Michael Haines

more work know-- But on typically side. you we No, unsecured the

Vince Tibone

meant on I me, you’d maybe Typically buyers, private their get be--you properties, the excuse competing know, financing. to private are Sorry, side. ability people your markets other against

Stuart Tanz

out different stepping those I centers we’re the buying. spend of I assets think for shopping a I those of you’re that’s that when looking don’t at the markets. mean, Not we but you’re type at--when time think for conversation, looking primary markets, looking in

Michael Haines

the primary to the get because likely of financing Right, markets for the demand still so are going product.

Stuart Tanz

But terms and trading gotten I are where mean, it perspective, and is where interesting large, are that trading Vince. that it’s equities so of know, in has bonds quite interesting bifurcation from fixed--you

Vince Tibone

I’ve yes, got. that’s helpful. all Thank Okay, you, that’s

Operator

Thank you.

Our next Chris from question Securities. Capital of Lucas One is

Your open. line is

Chris Lucas

guys. morning good Hey,

susceptible of Just at the vagaries set Mike, notes replacing, XX-year pricing at the pricing financing, quick on market two the looking on you’re follow-ups. the this the unsecured is to you that are still on point? that or

Michael Haines

in We’re terms. of actually the right the finalizing middle

to but specifics unable release going time, soon details. as issue the the We’re as that, a to we’re press at finalize we on this comment with

Chris Lucas

about Okay, wondering the some thank the up lined specifics more said are sales when have process Where you deals think that quarter asset or maybe where for you million. finalize? last are you’d do Stuart, $XX.X guess Then I at--do and two closing is to sit, expect I’m really I stage, that if can still does you’d just sales NOI dispositions, we at you. - you on dates? give you

Stuart Tanz

ahead moving both nicely. very They’re

expedite. going residential properties both both I we’re we redeveloped be know, think which the properties, will--you last We they're to through mentioned entitlement are as quarter, process, helping to being sold as and

So both of entitlement pretty we’re closed, are these deals late in process. moving to in forward expecting good the a ’XX because and at get pace XXXX

Chris Lucas

thanks. helpful. you, That’s okay. Thank all have, you, Got I that’s very

Operator

you. Thank

question Our is from Hoglund Jefferies. George next of

line is open. Your

George Hoglund

guys. morning Good

what little it Just deal to expense, know more it I can you how going bit it bad fluctuate of with many but on quarter, can to and the tenants had debt maybe quarter type categories just was? back comment a to

Michael Haines

and variances I It’s so properties, of that small through portfolios. drove one didn’t skimmed there’s out. the see tenant I necessarily that. across all stood just It’s really all property any nothing across really

Stuart Tanz

mean, X,XXX I so tenants, you’ve got does-- it

Richard Schoebel

and a we’re at there’s Yes, we saying, owe into dive no--as over that, every else. collectability. they that’s that is category something terms our process what or single trouble the and tenant high specific in there’s deep but no seeing of level Mike’s look in a It’s trend

Michael Haines

portfolio. Right . in (Indiscernible) necessarily the

George Hoglund

of monitoring? sort there watch tenants in or change be, Okay, has anything and you’re that’s in of was terms what next to my the any then question going list been notable

Stuart Tanz

No.

Richard Schoebel

No.

George Hoglund

growth, have of commencements Then else some--a last that bit that a there couple maybe later a in little expected. rent on same one weighed would kind store guys bit in started the little to of than terms you anything one store Okay. growth? the had quarter same alluded - Was of NOI NOI

Stuart Tanz

a of of No, them one opened it’s should really that but couple be nothing now or anchor spaces and ended up other one open, up--they’re the any is yesterday of shortly, particular. that

George Hoglund

for right. all color. Okay, the Thanks

Stuart Tanz

have that benefit of fourth anchor spaces late in the been in not really obviously, spaces the the a quarter It’s full we’re quarter. getting other, delivered with third of combination that some the

George Hoglund

Okay, thanks.

Operator

Thank you.

Our next Donnelly of Wells Jeff from Fargo. question is

is Your line open.

Jeff Donnelly

guys. Morning

past how fair was the of do next spreads is of you agree a much about XXXX, space next year that’s not with versus a and shop in year, rents characterization, at your year, whether expiration that wondering I maybe that you that small implying spreads accelerate the could and effectively for they Is Just or versus to been schedule. than I date this renewals faster sort rents year? on questions. expiring than think could market gap I’m as look couple releasing rents and wondering wider leasing accelerate achieved shop it’s your growing because your that are for if the thinking year

Richard Schoebel

are when again given in past, that leases to think But on see the something that we’ve to in sometimes number grow. year hard over rate as and yes, which mentioned rolling have as the rent continuing like last control what that it specific we that, in run don’t at reset. was a it’s general predict given you and I is Yes,

some coming good that we are some expect that up lifts in. significant to have have leases We

Jeff Donnelly

view? or about with the How you either your feel at will, national is generally level you discussions rhetoric do tenants, leverage day the major that does you sort press, or in day, I’m translate the at today? in negotiating level or just and of the the uncertainty if hear for worlds really if your two landlords a into local curious, it to

Richard Schoebel

really worlds view. two our It’s in

such everyone of have a on such renewal, there, the tenant a a our experience shot that’s conversation the here, we getting a of short but while the rent high in markets, markets. it’s our Given reduction years occupancy, at strong may when strength very throughout take demand properties out strong

worlds. is a of no, two tale it So really

Jeff Donnelly

notable given and are maybe focus or little any leases of that tenants treated I’m handling caught leases, distribution? broad-based been kind evolving bit, curious the there that such your how just on changes, just notable I major don’t omni-channel. if maybe maybe maybe mean Have rents but a in store-based as have attention changes have are sought, percentage

Richard Schoebel

want by are center click our add about footprints to we going impact or it’s Yes, tenants innovate I and to type of impact a that needs. be that as are of scenarios, on contacted very couple have of stalls their trying change we having has layout, the up redoing some a so it the parking they on been getting pick really to store a rolled little to Primarily something that, the some out. consumers’ - and but like bigger think always retailers to whole internal seeing meet grocery the

Jeff Donnelly

Do to significant be increase to a grocery prototypical these that that’s assuming floor kind feet to want to it feet, not of because XX,XXX lot to going from space that goes stores, like into is someone’s or they’re you eat I’m handle the that? to it, of footprint or going of square of that footprint not aspect area something XX,XXX square going think

Richard Schoebel

to existing been with date been the approached has we’ve what footprint. Primarily reconfiguring

question. the we of in go, you’re terms I feet think expansion. and click the square really and X,XXX XX,XXX to and the approached have store of across take little When size on flexibility feet, depends put got the but not the in board you’ve grocer it a been in

Jeff Donnelly

they’re last Stuart. those, kind either market guess Just been retail earlier, or of pursued of do portfolios, those? think about hunting one How back you’ve acquisitions and There’s I of little had about know one, a now or of strategic much them guess in next year ago. call maybe them a one $X.X how know elephant market in that for asked where do the some larger. but I couple portfolios, How I think you billion year. about the more large potentially a to coming you your spectrum? you type even does I’ll some fall I are of these

Stuart Tanz

we great we’ve centers, speaking, estate, acquire market the look them; Well, but transactions, portfolio look the looks look we in terms many shopping be are or had generally all it things. opportunities terms same so one-off other estate at through deals - certainly at to the we real discipline in to the past and the real mark of applying like and to of always continue what in

as as to we’ll So been. continue opportunities, we’ve but at to selective look always going again we’re be

of it’s not in say, it’s growth, of--or importantly, doing terms bigger, as we in of growth More NOI building in about and our things terms smart getting about shareholders. terms NAV value

Jeff Donnelly

you, guys. thank Great,

Operator

Thank you.

of question Mueller next Morgan. Michael is from Our JP

Your line is open.

Michael Mueller

you’re in or maintenance notable wondering there prior you similar Hey, talk years, compared good you’re burden and bit if terms burden was up in this I and recent it in out you’re couple I the morning. TIs, more and seeing to year acquiring about and a Are capex thinking spending a a capex any property? acquisitions. trends less you what just a what thinking seeing just could change break about of guess as little going quarters at about also then levels, of

Stuart Tanz

I’ll talk capex. in about deal inside terms be trends of is in different to of But terms a and bit the of Rich portfolio. in terms I’ll acquisitions question Well, let then acquisitions, going address every just the

For beautiful. one just several look needs zero million Orange in just the - example, capex center spent dollars the seller making County the

maintaining that might deal terms different more always is sure because important The is trend we from capital in. sub-market or thing going looking every we one relates be to So a it’s make costs leasing that you it in like of so you’re tough that say. to our single of to assets best that the a as you to perspective, properties tell looks that bit what the operate in are capex, as

inside In seeing you’re terms Rich, capex? of trends the on the portfolio,

Richard Schoebel

box a again now splitting have space. I portfolio. just portfolio going in benefits an tenant Then you’re to anchor the the two outlays, any the in or to significant of bigger reap something that that capital a spends to once you’ll the existing dollar it’s I be think we’ve through news regardless Stuart is are good significant see forward use spends add terms that just currently don’t saying, capital going you’re leases, Yes, done, those worked that and the capital Those in portfolio but think was what tenants. retail our some of the what of we converting obviously along properties on our can is accommodate on in or when lines, of terms onto restaurant

Michael Mueller

helpful, That’s okay. thank it, Got you.

Operator

Mr. today. you, to I’d Thank session does and that Stuart turn call further the Tanz Q&A conclude our any remarks. for back for to like over

Stuart Tanz

like joining to I’d you us closing, In thank for today. all of

Rich If website. quarterly additional in package, supplement can you posted the on Also, Mike, is have directly. you find questions, me information please our which contact company’s or additional

NAREIT you again, see a attending and to are day few For there. annual everyone. great hope those in who Thanks we convention have Dallas in weeks, a

Operator

and and you have conference. conclude day. does you This today’s for disconnect. thank Ladies program today’s gentlemen, all Everyone in a great participating may

Retail Opportunity Investments (ROIC) 25 Oct 172017 Q3 Earnings call transcript