KW - Earnings call transcript Q1 2020 | Kennedy-Wilson Holdings, Inc.

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good morning, and welcome to the Kennedy-Wilson First Quarter 2020 Earnings Conference Call and Webcast. [Operator Instructions].

I would now like to turn the conference over to Daven Bhavsar, VP of Investor Relations. Please go ahead.

Daven Bhavsar

Thank you, and good morning. of and of today of Kennedy-Wilson. Kennedy-Wilson; Windisch, Vice Bhavsar, Chairman Bill Kennedy-Wilson; Daven Enbody, Executive CEO Justin and Mary President is joining Officer are us McMorrow, Matt Chief This Financial and of Kennedy-Wilson; Ricks, President call and be replay. webcast archived live be will for Today's will phone The by week by for replay will be webcast and X available for months. X Investor information. more Relations for website the see Please

adjusted non-GAAP call, financial to measures, net we income. EBITDA adjusted this On certain and will including refer

of description the Relations a is You items GAAP along measure of find can the first section which reconciliation a these website. earnings most financial Investor with our posted on release, comparable directly of quarter and our XXXX

forward-looking number during due may Statements this and information filings risks, Actual of include on call results Securities the this and and Exchange in to reports statements. Commission. indicated call other differ with factors a made forward-looking discussed uncertainties from may materially

Chairman would now Bill to call turn McMorrow. the I to like and CEO, our over

William McMorrow

but globe. crisis, our you others police this heartfelt services others. feel much, those firefighters, from families deepest us the I and their your sacrificing today. period many are And discuss Daven, and thanks everybody through and this joining you well in possible and health hope outstanding first call my in deserve highlights to way, quarter during to all before admiration. greater to and providing thank thanks which They I'd gratitude and extend help very like collections Mary time. as this know essential the and April, this challenging detail, really own on doing I the for safety care around as they are first of everybody, morning, officers well-being bravely responders, our I including good rent will discuss workers,

all parts challenges and continues the doing what global of I'd we're the first our better. on I'm across of never to has is our KW to healthy, team to created company pandemic has us, ensure all been While smoothly. report communication COVID-XX like for comment run unprecedented thankful that to the business

to our global hallmark X decades people a ability investment the grew from business, real into and we X Kennedy-Wilson XX estate in $XX,XXX company has beat. our been communications we capital a As office, In staff of our past over across that communicate business March, months out for rolled X remote lines. remotely the work all allowed missing a past a of to without global has plan

and finance frequency Board are with up-to-date ensure senior and team, management cash calls team, increased global latest daily page and team, developments. have our we've of management the same on the our that We asset the our all we our management on to meetings

to and which people and term. members certain we better legal, the company. thanks gratitude in company families of and the teams, to and months. our be all our like I'd together human contributions a continue backbone In the for accounting, communication very X constant our with their better we addition, I am gone our during will make resources, IT Board long through express have and tireless that insurance, tremendous past what their dialogue us for to form greatest employees, my

and EBITDA same-property growth good continued The quarter of With NOI million. on highlighted we $XX our that, asset net portfolio, for sales multifamily development on in construction quarter, and management our further investment strong progress in touch highlights on X% to growth the progress our adjusted of of our produced pipeline. million our income was platform, $XXX by

liquidity. it allocation all has at capital As it's always been about KW, preserving today, while

XX% capital, allocated XX% to with to XX% we of and quarter, the buybacks. CapEx In to acquisitions, $XX million share

$XXX over estate the We our side investment the of was of was million we real in been $XXX seller, acquisitions interest in net sold ownership our in ownership We have XX%. were completed which a in as investments quarter, million which the years. we quarter, the last On few XXX%.

in our we The that rate, asset to platform Pioneer nonperforming in the million in to Kingdom. investment as United sold unlevered asset the of largest XXXX continued adding plan, our space, the we X.X% including residential square Point, XXXX. into in saw feet our February this a QX We XX,XXX cap distribution asset only acquired this pleased multifamily loan strong XXXX. quarter at returned completed was XXX And growth amenity unit a report I'm $XXX asset in was KW. after which we and in management of value-add management

During an quarter, is to fee-bearing we XXXX. $X.X up XX% total our QX bringing capital, raised since This in the additional million $XXX billion.

Looking ahead, globally, high-quality currently environment investors we the and to financial expect in we are key our given interest investing rate real low partners other in estate. continue

allow to this As will management continue growing us a result, our investment platform.

partners the our secured we debt as With public our September, investments XXXX platform, Last estate. we real high-quality in are in and where primarily relaunched by a investing in going estate-related result also unlevered alongside We debt in investments $X take over these of debt. great typically acquired and X% recurring management in we've or billion to real fees. originated recession, XX% interest

fees, $XXX investor. million last unlevered In are returns that are we our completed When on where investment in X% you in a we've management the double-digit include earning purchases, our completed months, we loan $XXX X capital. April, loan million we including

attention turned At quarter end, we to quickly April. our

I'd context years to two you Before on Mary collections this we how like rent a and type began of debt. give model own preparing leasing, for little ago discusses April

started on of strength, liquidity we've I'm levels risks. to Our from hand past unforeseen say earnings that most grateful in a position history. had calls in the armed with to our have order to higher year we described the cash our ever plan keep any mitigate of

gains adding also KW. many We and approximately the sold harvested seller of of to sales has have January real these Since noncore disposal liquidity assets. constantly have our of net share X of billion by estate XXXX, Kennedy-Wilson's $X we was hotel been billion a included and which being past million $XXX $X.X years. assets, to These

More in power. year. further October million the Industries separate million in $XXX of Security sheet affiliate, assets it last the that platform, Eldridge's This platform strengthened was with Benefit, in Eldridge our billion recently, asset total investment date. by to acquired expansion purchase coincided $XXX of our increasing account preferred balance investment the In of $X.X with equity approximately we've to

credit we of $X.X total of quarter have million million and billion a line cash of an of for $XXX dry end, As on the worth of $XXX availability of our powder. additional

mentioned with of in the our that quarter for extended year line during volatile our was period, while improving option also credit We fifth for the of middle pricing. more years the this X

discretionary include we $XXX powder. our have When the currently X total $X.X available of have you within cash billion million in discretionary of -- dry funds, a

Additionally, who well with Kennedy-Wilson. with we partnering are dollars have strategic partners of liquidity of positioned in interest billions and strong several a

for very maturity favorable $XXX million maturing the next $XX maturing million with remainder debt year profile this Our remains and of year.

All of nonrecourse are our the debt property-level year secured through next maturities financings.

are position debt and of we great maturities. liquidity ample having financial limited both So in

and portfolio, As may by you which type, know, a by by estate maintained dominated always is product diversified multifamily office. both we and geography have real

the our we To and collections our an commercial turn President, call on April Ricks. stand like over where provide to update rent leasing to Mary on you activities, I'd on in

Mary Ricks

are on you Thanks, all to Bill. well. the and and start your echoing everyone families and of like to hope our call doing I'd by sentiments, thank employees your

X and classes together our our our annual XX% mentioned, which Bill XX% April of NOI office, account globally As asset of largest are estimated for and multifamily rents.

enhanced we portfolio and of of have XX,XXX our resident where high-quality communities, consists units Our offering a variety amenities. globally totaled experience through multifamily tenant

totaled $X,XXX, rents highs going occupied, our quarter close As us and was April. XX% solid ground average of and to putting end, all-time portfolio on into

rent as good result, May. multifamily rent have difficult collection in rent saw totaled I'm happy in time. in saw Ireland, XX%. performed market our during the we of collections and very rate a XX% saw start in XX%. And XX%. portfolio, management In collections on-site collections Thus, a we that we to well and Our portfolio, rent senior across affordable U.S. vintage teams the our high board, and April this very report extremely have housing, of April collections in of levels apartment rent And saw

weighted quarter of a occupied X.X years. globally of lease Our with as office was term portfolio XX% end, average

global XX in credit Street, of top Italian office XX% Microsoft, to governments name to like few. Google, of Bank collections our and KPMG, pleased Indeed XX%. collected report companies tenants office the in State Costco, quality a U.K. am from April and rent top include I tenants, total, Our the were April strong Ireland, XX we rent that and

the XX%. at were office in regionally, Looking rent collections U.S.,

our XX% Our we tenants of top XX and XX% of office portfolio, account we variable of collected the for collected rent. In rents. Europe, office XX%

rent creditworthy and on tenants XX XX%. and office of proud for We're tenant top top collection was the our account tenants leases. portfolio in at XX very to fortunate Europe for our have large of XX% base long-term Our

The our million. April rent retail due portfolio totaled from $X.X

We have XX% with million collected outstanding. $X.X

utilize increases moderate retail government retail in available figures. We the to expect smaller expect various relief them programs therefore, that to the and tenants are collection eventually

in industrial outstanding. Finally, which we $XXX,XXX due we of portfolio the have U.K. have a $XXX,XXX rent in small of with April,

of industrial and portfolio, $X.X only have our across rent in So April. million we retail outstanding

of collections share ahead, rent their collecting In as in global our April to pay quarterly note robust like April. rents us I'd touch in our in in our total, start on and a look due tenants of office XX% much activity. like we our to across of majority gave we rents. of May rents the advance June And portfolio. our head collected April I'd also European in Thus, that leasing

data extensions encouraging We and across our leasing commercial and renewals complete portfolio. see continue as to pursue we lease

continues and today new to to the that portfolio. our of companies costs. This attract corporates positioned to be for mindful our with retain leasing looking and activity is high-quality priced even proved assets, out continue existing throughout portfolio office space Our well occupancy given tenants well-located attractively be

April. so reviews XX transactions and across and million. we've XX,XXX in square term lease a transactions had commercial completed feet weighted lease lease average of renewals,on income lease far in square Globally, extensions, of $X.X year, incremental this feet which includes resulted years These X.X XXX,XXX

again, communities feet been tenants, another for of thus, rolling portfolio, In for currently assets secure have new for the XXXX. our of tenants leases our sign as largest in online. rate Irish requirements. well to our of strength week, and sign them April out our will have June. legals, the and our to as technology U.S. leases encouraging Irish plans portfolio apply tenants from By multifamily tours to XXX market of our And virtually. by XX% virtual leases prospective XX in multifamily And have of lease the XXX% U.S. were long-term these new long-term We multifamily portfolio next to end allowing confidence of of and XXX,XXX X% properties very a take are April, their roll many completed our of end assets. a across We square we with in this the U.S. space transactions. our our capability completed in out XXX% looking increase

virtual promising new And exciting traction so technology. this we seen early have in

turn With that, Bill. I'd to back like over the call to

William McMorrow

Mary. Thanks,

Now construction funded projects has major Most our initiatives I'd update projects. you focus equity Kennedy-Wilson. like our of been construction a fully by on lease near-term on the already to with for

-- And Virtually development are and enjoy we XX-XX partners. leasing construction X ownership major be million expected multifamily in hotel. XXXX and our square in our include square XX% completed are joint development leasing and feet strategic of commercial a units, Our ventures portfolio. to with initiatives by capital and our total, projects currently X.X all X,XXX

spend the We for commitments $XX of to in our remainder of approximately for cash CapEx million only and million XXXX. to million expect $XX $XX QX

Dublin, currently in later reopen construction to As it developments relates we this our expect month. to

all acquired final is of X, excited it Soon acres completed Phases apartment will thereafter, of land. total which XX% largest phase, X, be Clancy X.X developed occupied. are XXXX, make finish of Phase at to X time and XXX Quay which undeveloped the to Clancy units, end Ireland, we the Phase XXX units. We had community with finish June. are originally now and XXX by of currently on the a will units track we which in totals the which X And in complete, are which

Kildare and The feet. Quay XXX,XXX two Dublin Hanover square office construction projects, total

expect Irish the are on Leisureplex Crossing to track XXXX. in Grange, longer-term remaining currently all next Coopers we the year. developments, and X We finish The complete are projects, to construction

is at the is QX for Pointe disruption. completion for In make XXXX. Santa date the Construction XXX Rosewood with Boise, and River to our in and California and and all minimal we completion developments third which XXXX, Northern Rosa Santa Clara of on Clara, Idaho, U.S., together progress the continue of total quarter has The Rosewood, Rosa date continued units. of

are new progress XXX have we great making or we with in existing construction X,XXX in as to in platform acquired by adding XX% the vintage to land are the X,XXX units of end where the the XXXX, to units housing acquired units developments, total, grow XX,XXX lease-up portfolio increase units track In also representing the an we pipeline. currently X stabilized we sites on XXXX. under the our on since X,XXX in and quarter We're units another of

from Looking we've years to current in sixth at that like I've gone period, of experienced in savings September marks and of bubble, to Kennedy-Wilson. recent, fallout to the XXXX collapse crisis a recession. career, ahead, most context I'd great course, rate crisis 'XX tragic corrections through XX% the events what put XXXX, starting the had and the The which this prime loan dot-com interest XX XXXX these the crisis, economic with inflation, major last XXXX the my the of the of XX, high and economic XXXX

dislocation led In XXXX, in in the did Brexit And XXXX. to XX% first of public led XXXX. caused in we already $X.X on of and IPO the In the recession, Japan the IPO of great each the these during went that the A in of we of to entered Kennedy-Wilson on Stock second billion for And In by history we Stock Europe year remaining mobilized. office closed we time, later, the the launched Japan of our Exchange. real XXXX, the Tokyo which own, in estate after that London XXXX, summer first fund we ultimately largest we IPO NYSE. that business. Exchange Kennedy-Wilson the acquired management opened XXXX, in October not our Kennedy-Wilson Kennedy-Wilson, the moments,

a and But an know eventually we all has crisis that end. beginning each

extremely timing have the different. people successfully partners; no have Challenging While time. a currently venture you is and over joint difficult of will recurring same be predict, long long liquidity, excess components: period times key of that flow; together X to the working is this cash team one that been important strong

all we to grateful I'm X. have Today, say

best-in-class We developments have will a very real high-quality years. over with we estate that X next portfolio the finish

well themselves capitalized had significant liquidity. have the partners have going we've liquidity We most alongside since us who public, we and have very

through proven has opportunity. a track of senior We have decades that and during periods cycles management the team investing record a team together experience of has working many of

to a experience where of to Todd We to our addition also of continue investment we benefit tap Todd of recent is from of Board most honored in Directors. Board was able and billion. company under are management Chairman Boehly, joined having the Todd Co-Founder Industries, Board, our leadership who knowledge. The assets extensive have Eldridge his I'm with $XX and on our to diversified March,

leverage I challenges, undoubtedly plan relationship positioned time, to deal network XXXX extensive into opportunities. same our believe well the unknown also we at we present and while new sourcing uncovering financially, will While are experience

together for is and I'm this a of confident challenge, any emerge that we'll ready company. team out stronger Kennedy-Wilson

questions. So that, it Daven, like to with up any I'd open to

Operator

[Operator Instructions].

comes with First from JPMorgan. question Paolone today Anthony

Anthony Paolone

of change this? first given look where all My what thought years, -- go just track everything question out property cap your and seen over values have coming what's bigger on or record you like your in process picture, rates the

William McMorrow

of months is mean whole answer question. I frame I ago. this and would started this Well, in get see as anybody everybody Yes. process. directly, this saying location is because to I've pandemic, knows only at early company, your think in that investor we to then process question start two this an we're I the got whole early that before think I I where that by I'll kind least

lag And so there's you're always when a and up actually time when ready between opportunities show invest. to

later But was about think when recession, we our recession we're great following about the what in and trip to very, And our is say were in XXXX, there today that the XX first would when the during starting it Ireland, we very we during in months in when than great made you investment there. made you different happened I we sense. first think Kennedy-Wilson, at that went what spot a

I of as own our went liquidity, through, have We then. had than back already more we

partners, those many had capital lot partners of we capital actually period during a time more had financial but their And issues. of that own

whether relationships the or our years Japan, And in with so the as flow. all to XX cultivating extensive Europe had operation been and over mentioned. the or of financial the for financial have years, that institutions we States spend new time we the core a that we've on over always I lot last United of partners deal world worked here third-party at in it's in And XX-plus create has

And it do I business from you of most counterparty. think that do. do that -- we're we we to what what we In I reliable the exactly you hear say financial institutions would believe is we're words, other what going would with extremely

the thing management your Europe. we through through And the have in all through great experience question say before whether gone the was went the answer all it would the or of that have the that States now in team is people I I that last the company United have we going exact recession, in today,

can't of so in experience you time. means this discount And what period

investment said Japan the last Tony, last the I over happened long think I actually this an least time believe that as platform a rate X of months. couple of before interest to having ultra-low these and in as close I've perspective going at in that environment to stay far period for years, having for events a in XX now on were global I years, calls of think, that been -- and now, for a we

that time, of asset low have rates. to going period to in days XX you're stretch ultimately people you cap have you're interest by over invest in long going And my one at a not are X of going look so that be the will when looking followed at classes lower to months, or various tenure, -- rates

where, time -- to there's reserves. but a of knows, banks going here as so the period And major taken well be have everybody

I process, going term, extremely rates this what be stay -- in the I'm dislocation where out to stay there's there's so rates a period believe to time is a cap going to will create low the the sensitive, one, low. opportunities financial institutions. that's although of are But sensitive long And and to here going are of which

And -- a the, I all there people -- to there's coming that estate. news we from say time, even at a of and see strong for desire economic in this lot liquidity of still invest terrible with there's every still direction, would real

we've base, one very I that's really to outward things communication constant in our internal should in the things said, see the our with been to And we've we've reaching communication, or directionally. addition in our our going we X think where of partners, them shareholder months, partners. with been assessing last to that whether have been major

of both account partners business would that and look that major when through separate in have all not you we've of with, tell that of the all we our I separate that funds names did just companies have really capability. we partners, household you platforms, our account got our insurance it's

So but during to of you've be these -- period got patient times.

jumping the just market. can't You into start

see give wanted It cap longer you're question. you I hope to term, low see you're going I compression. little I rates, over background. to long-winded, that specifically, was but rate I going the with to answered interest think But a So

Operator

with from Evercore. next comes Sheila question The McGrath

Sheila McGrath

on mention you Pioneer you see opportunities. I investment bit get did wanted the little information Point loan do more Because that disposition. some a to

ended the a can loan you in own? to us, How opportunity to just investment think terms that up of I IRR remind loan was Kennedy-Wilson? If that

William McMorrow

to the do you All Sheila right. take and through on that history Mary, everyone want transaction?

Mary Ricks

you a deal That so Sure. period the and that in that deal. remember buying was really the that And to a get from bought were loan was to was that -- came we we and X Sheila, from we in market. partially German asset, debt. a right closed a of Europe were where at had lot off did rid that, time it's completely that of X just asset. the was was bank towers, rented. That X deal German bank,

did And and team you past. is to has we took complex, lenders was been title have somewhat so we know, I a asset, what as our the but much background the in think, lot of which of

how and in something an to taking in So debt opportunity terms of that that's of title the then estate, know terms set, real to buying do. we

offering and put ground opened to did multifamily multifamily on we're took which a the best-in-class KW so to and to and we unique whole signature, of really went sure needed of floor, we we improvements block little bit is sort U.K. tower, a European kind estate and real title a asset make do whatever amenity And the the class. and ahead other the then

on. did we team we place will up, put well very, the it well. stabilized, very it buyer our all a and we lease of And job. and in and did and went think was as a do then So well, great amenities sold and up next I it ahead the let And

it's a asset. good really So

you the it have The specific was have mid-XXs, Yes, would I low I KW. to mean probably back an number. to excellent -- I saw get in the to you on But the think the IRR been for I'd rate. cap return have IRR mean

Sheila McGrath

comment paying I home bigger rent you as And WeWork and with your just thoughts as picture update plans office London on And could everybody property? wondered, now? Great. on right Okay. your on the far sector at the maybe Bill, any

William McMorrow

the of But which Mary very, Yes. going WeWork, big going space. second. obviously like I to tech office now see let a at Sheila remotely talking that time, all the in bubble they discussion XXXX, a concerned, as remember were for that to yesterday, tech about far of to Yes. diminished how is I working a the that everybody you're they when office on in all portfolio that a very remotely. going going work our having were And part and lot the including listened of on accounting office all is world need small -- happened. is that What firms, as I'm there's in going was to talk about

own And it's work I contact at human you've to when -- got distractions. it's that to our one other social we've be of home can't is not lot the of company, period the that had that be two in things logistically, think that and the to fact all got sensitive this home the And to the families of is I space need in that underestimated to school. younger company we've at know and time for now going a things office have relate younger easy in kids aren't that

actually And in its a then own so of distractions that that can and finding house. presents you place your set work

so would be of I I the belief to there'll extended -- anything. it's there'll my is amount over say little topic, but long be And of bit not discussions term, think going that a this to really

amount tremendous there And office overbuilding that a been also markets the in we're not think has that I of do in.

to long over last, I the we're all -- emphasis so longer, more don't that go their we spaces functions. things respecting with private to have all don't on changing see see that the are when into the office been that office People open all, reconfiguring back at And amount to space X I work. any going to for expect And going see less while space have years, don't people in the say, reduction the I'd of have. maybe term, any I

market their it the going most social remotely, leave respect the of just to to and individual that to term, for fine to think think issues. far time, decide the long or in mind companies what markets. we're be office is period to are working own I to office the obviously new to going whole But a as employees good they want going have as in the do I distancing

the you our I say, recession today we're in recession. now establishing to all didn't lot great Western to big that or that the even have in other the United it is either United of markets extensive have the we back platforms the great States, platform Sheila, weren't when We we exist, throughout Mary, when the that And company Kingdom a in too would I before of didn't the think Ireland difference and which turn started.

somebody. XX business think But you have choose at you the -- areas, plus our the relates is our occupied XXX,XXX, probably WeWork, WeWork, And think office feet, square square of it including are space, in when million that's it apartment space XX,XXX isn't look X,XXX totality, square feet Mary, less of our by and I in than as when about share to just feet, units common it? than we there less XXX,XXX

Mary Ricks

which all it's Cal assets. less is, best the X That's is XX% London that Yes. It's a Sheila, tightest have best built referenced city, income, best-performing one we That And couple one add you the located the thousand then over and of very for by I WeWork of mean, that an is occupied WeWork. enterprise is of markets thing in It of the only in they submarket, honestly, X% which then it's own small. our the hundred Francisco, about X% so asset. Southbank in have is square fully of XXX some the taking of San feet. building London, past the than out of in one represents tenant would other just vacancy. office years. Rents And in of our increased space. best the significantly I

loan-to-own London. recall, did we you in we another that type transaction got that actually was That asset. If

in asset. very Our low basis is that

and in by working year. on later construction asset, WeWork's that be in on actually, in And is Southbank, this that and the of best-performing they London one right plan now particular submarkets. they're But to

William McMorrow

And of Is Sheila that -- too. Mary, XXX% April, correct? the they rent also paid in

Mary Ricks

Fully paid. Correct.

Sheila McGrath

all locations? their On

Mary Ricks

Correct.

Operator

[Operator Deutsche question Tom comes from Instructions]. Bank. Hennessy The with next

Thomas Hennessy

could on you've in I for been gets My about $X raising I tough any reputation reference, for opposite, new capital, get it make and doing in investing billion-plus you've the have guys been environment, from with do question had partners? a you or challenges that? essentially you Or mean, year. is that. is it special pace capital adding additional to fee-bearing other anticipate it to partners recessionary the guess, -- a sometimes make new you Do -- situations

William McMorrow

Yes. Yes.

that you I that had you Currently, and already inbounds we in with. obviously, with one. can that existing have or have do our existing world well, never business done frame this to from that partners companies business from in many have do capital flux. that we tell with think people everything I we today, is we business

out be sense the there, the in. like opportunities assumption money under that at I never us the capital pressure the the that to on so next it's there's fee-bearing said, invest during are Kennedy-Wilson, here X to to any opportunities we're invest years that But going there always we assumption opportunity. And growing like significantly right feel on we've see makes unless quite

clearly to opportunity. So the right be thing. is that be the The would to key There money available us. has

Thomas Hennessy

a dislocations mean net anticipate I -- do buyer That mean, ton in -- jump of here, with sense. have of we a before near obvious mentioned right what mean a it guess makes I on and in a waiting [indiscernible]. close follow-up that just you to seems But I months XXXX? there. XX made Ireland and your had you for you being I in with more term.

William McMorrow

I'm really, to own today is. And when acquisitions. like Pioneer debt one at we basically that cycle, acquired those buy there's It think, I every that to modest set debt debt Mary assets opportunities to depends debt some as the mentioned, would be And to that in the we sidestep then and principal was, it, continue just amount debt we opportunity own types the think tend acquisitions through there a a in the collect of you on the to we've done purchases, Point. about then you even what own. trying Europe, not three, described our really I of initial but two Sheila, amount. historically, of that buy this origination And guess, the loan generally,

States, different happen In that pay to quickly. cycle tasked be takes we interest, all then the for know, this going there's that surface ownership the a system pretty through as will there's first where borrowers receivership as we goes longer receivers many the opportunities believe side and the receivership tends the are Europe, on seek. United to protections basically, are debt in selling go to in especially can into equity And But with asset. system. it the don't people that their the That it

So capital -- that the will make sense. underlying investment that that there assuming definitely assumption grow are fee-bearing under opportunities the XXx

available find good safely it need and it have smart put just returns. be to places with We to enough us. risk-adjusted to to We

Operator

question Jamie Merrill of Bank Feldman The next from with Lynch. comes America

James Feldman

on levels. think then you leverage wanted just line. still of your draw on liquidity, your credit line if And -- you and have liquidity on your is about lot a thoughts the of I you did get to that that some

do if are found you Just to take how leverage the you how opportunities? think you about willing from you'd And perspective? be think about what high governors that

William McMorrow

Yes. Yes.

Okay.

to So Windish. Matt, that punt I'm question to going Matt

Matt Windisch

Yes. Sure.

two note years, So over if the that look our we're consolidated years. with the definitely are leverage. past down our where On they at today. last we've debt, two over reduced leverage we're you XX% levels, I'd comfortable

period time. proceeds Our equity, latter the used X% over two our the last we to being come down of million And debt towards look you pay all that maturing we preferred same then if of net raised have that at what $XXX And did down year, by the than nonrecourse. of less of next has debt we debt. half in of years, XX%

a remarks, as company. liquidity levels And as the Bill his we've we mentioned of had have in highest ever

business position. with particularly debt several basis on as that the debt opportunities acquire we an the And liquidity way over space that with very of at to not come feel in we're enough within the present have the to certainly and have. next think there may where extent to some the unlevered we a partners good We capital our leverage that doing themselves, quarters, likely we're assets opportunities, increasing that typically So and business. comfortable we do the the in are that

we very we're leverage up, certainly levels So years. couple up over our liquidity levels. the see I sum the with of next going don't and invest we And comfortable to it as capital guess leverage

James Feldman

high Do you'd have operating? you like of comfortable where end be a

Matt Windisch

we're now the to I think is we're at going where highest go.

James Feldman

Okay.

today? leverage higher to you want wouldn't are take when any than you So

Matt Windisch

Correct.

William McMorrow

Correct.

James Feldman

or think even pretty need you fully leased the Okay. about you out Do of think or feel portfolio, original underwriting? delays you leased delays? And then dates fully on dates any to unstabilized development, portfolio do development kind and as potential the you stabilization the based your push leasing on of construction confident

William McMorrow

the Well, California, places, And and we continue the states many starting and assets, I States, United Rosa Boise basically, in during Northern the as last work actually Santa reopen we you wasn't -- they're and of there were in couple Western allowed other do we all -- U.S., to to disruption the months. of as Utah in now the in to everything. multifamily know, side, had, particularly, on-site they're the vintage I much said, mean,

So we the big any timing see differences U.S. don't in

in United shut Kingdom the of they course, Europe, Ireland, In sites. and the

the distancing that May,with Now to of new sites and terms going the they're all construction reopening of all XXth Ireland has of announced on of guidelines work of that. allow the and in safety

the you, We that landscaping. be of It's move basically in. In which Clancy, the June. projects fully to finished have your the to move just have ever largest to and undertaken, So to you apartments finished is rent at one Ireland, of just we've mentioned going now. the that's exterior We furnished. finish completely furniture end really I

X% the the leasing encouraging the virtual that. of so it XXX that And of is goes. a that up leases the having We out and the extremely and to earlier XX% that has in pointed Mary virtual have leasing. think don't in compelling see thing we'll do us, being crystal about and real quite of month call been done of how to statistic. I But that virtually eye ball XXXX April, what been leasing April the in over was is That be those opener a any the has success on the stat

time States with to we lion's related we a only related property in had down that to make we that share we wanted close was in get the have And development. correct. pandemic wanted didn't to extra the and our things. that single sure at that United had that And that to before we The to sure It every strong property relate to fact that all. It hotel to make X the that wanted capital place loan venture of partner. did take construction It with very we buttoned construction we really a cost we the loan undertook the the in March. XX-XX

year. else intentionally out that almost running up everything is we now. And we're progressing time moved and a by and on so right But budget. But on

we're Grange X venture the of X design also Europe. Crossing well-capitalized and deals I joint doing the XX-XX projects, mentioned aren't in that yet process the the that actually, and a the architectural ones. biggest partners that's piece what X under in are venture And with multifamily doing, partner. completed, -- based enabling are are with we're big joint They're But those doing And a all projects it's those major Coopers office work is company major, venture with a both the they X insurance are there last then is in and the -- work. Ireland that of of construction. them, we're

the had a one construction on will assets the But be multifamily Clancy. in we've part delay assets, both right range. running time the that on the big, big that these and Ireland But XXXX are of those little in all are vintage pipeline market more rate three the with

James Feldman

a and Okay. with the kind West market Mountain unique of focus. And focus pretty then State footprint got Coast you've

going If concentrate your you other are footprint? Or you current go apartment resident to mean markets? Coast around a New of York the -- disruption in would on either other like U.S., to or I of or some or see the to commercial willing parts be side, East these you still

William McMorrow

unlikely. same important a never, just on asset time teams we're Look, in I underestimate the can't to front front of the call, also in, in types on. that to same the, I embedded endeavors is we're every got and planning money but that the own like key to -- with that acquisition ground. that relationships, markets say of key how of make sure think people doing that our the going the where kind team time work the would you've in is it's you The big hopefully, deep the I never very management And on these day. of all have a both we a are you're invest, capabilities on like in we're And

for to the our in, have say which So and I I basically of a, say, lack put in West our Western it, think time, Rockies Coast markets we're on is spend the United pioneer been investors. the we've the is way on the Ireland the screen would they well would west United we and going that Kingdom came to better before to became, markets a radar of we've footprint where been that States, going institutional I

West City that we've And Coast Denver. some markets last so platform on have so months. Rocky Seattle, gone Salt Lake states, Boise, Mountain and smaller and big the in XX a we on, other now And the here into in the

markets in have a opportunities already the of plenty in. that we footprint there's So

that. is. it's what have we question, your we the go think unlikely answer to But see to of I set So out opportunity

James Feldman

portfolio. tech finally, Okay. had then the you in some And exposure decent

with that terms office having the changing of Just tenants conversations be they of you're side, may from any needs? in space office how their planning anecdotes larger your or

William McMorrow

Yes.

what I high-quality it's was lot around properties. then changes. very, said very XX for our answering you're it things to XX think question credit And new tenants the get a of next months think in a that discussion going Sheila's over not earlier, a the or normal, any there'll we significant I to see think time. We're I that to period of it be I as sure, back is, fortunate longer whatever have normal

Seattle the Googles, to the anybody we call. Francisco And they're news market, are which so Microsofts doing well, have, this market -- I and in tenants obviously, dominant that and no on actually the on. some are all the in the tech of San the and so tenants, clearly the mean Dublin tenants

be So can over longer significant any changes Mary, space. term, people the how reconfigure change. see there don't, their in I And may

Mary Ricks

Right.

William McMorrow

XX that is of always office of the there be for happens term, XX lending to for part too, won't new for the any other which the think construction near months. I this, availability next And space

way And supply self-correcting don't... this has Mary, of But so any I that issues.

Mary Ricks

hearing new say work if what I Bill, well of in of a in of is, to you especially normal, sort are how plays return takes lot think tenants, from work we're And the I terms configured. obviously, our Yes, going was the our environments planning, will. portfolio significant to really

And to of facilitate to don't we and have social way elevators. things. have distancing, you XX-story people those kinds think our where technology, we enhanced rises take egress, to when said, queue high have hands-free the I Bill cleaning, properties, As ingress with

of well have I type very We itself today. plays think to a tenants' product, needs more which office low-rise

from to that of a lot And just they to our their space out. we're want hearing want spread more -- tenants now right people because take they

think So I and these I do to interesting, be portfolio very, very with our new going it's well think will normals.

Operator

Bill concludes McMorrow for This to any turn now like closing to back over our session. would question-and-answer remarks. I conference the

William McMorrow

everybody thank good it your and with support. we'll And close health these and on say talk this Well, for as as I on appreciate the I always call, out, I we soon. your families and safety. your I would say company you calls, in We interest wish

thank much. you very So

Operator

now presentation. concluded. has attending today's you Thank Conference for

You may disconnect. now

Kennedy-Wilson (KW) 10 May 202020 Q1 Earnings call transcript