STAG - Earnings call 4 2023 | STAG Industrial, Inc.

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Operator

Greetings, and welcome to the STAG Industrial Fourth Quarter 2023 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Steve Xiarhos, Investor Relations. Thank you, Xiarhos.

You may begin.

Steve Xiarhos

Thank you. conference the Industrial's results. quarter STAG to call fourth covering XXXX Welcome

company's the addition distributed supplemental unaudited the release the information www.stagindustrial.com we on In press an yesterday, to Relations Investor section. have posted presentation website, under quarterly

and XXXX. the contain questions as in remarks statements Litigation Securities to the your On today's Private prepared Reform answers call, defined company's will forward-looking Act of

of cause those are disposition address to other risks G&A, Examples may matters discussed and collections, that rent from differ that NOI, subject leasing and statements guidance, of actual statements volumes, forecasts to other economic Forward-looking uncertainties results same-store and include core trends forward-looking today. and matters. industry prospects, retention FFO, rates and acquisition

discussion I filings encourage package company's of supplemental related the contained available the forward-looking with non-GAAP the the all definitions company's in statements measures listeners these to and detailed information and on more to the SEC in reconciliations contained review website. the

reminder, management's a statements represent to any forward-looking of no assumes estimates obligation forward-looking today. statements. Industrial update As STAG as

our On Crooker, hear and are is Also of Estate Chase, with today focus. you Executive Officer; our to will Financial available from questions Operations, here us Bill Matts Steve Officer. the Investment answer of Chief areas Kimball, today's Officer; our Mike Chief to and EVP call, who Pinard, Real Chief specific

turn over call to the now I'll Bill.

William Crooker

the call Good fourth Thank STAG earnings and to quarter you, Steve. morning, welcome everybody, Industrial. for

the are XXXX quarter year and forward and results. We look to telling you have fourth you about pleased to us join full

rent were by rent same-store for digits. These company. our We was NOI single same-store we years and leasing market XXXX public spreads portfolio growth growth portfolio. produced a record best and was spreads one operational the our XXXX market driven as of record high continued in NOI. leasing cash had growth

growth non-coastal markets XXXX. normalization, rent markets experienced a national, in On has coastal outperformed market generally degree of

especially in a which strong, by remains including manufacturing consumer prints in to health e-commerce, tailwinds, indicating have and intact. XX% Recent boom been requirements, Secular domestic contributed retail sales nearshoring have XXXX. that in grew onshoring,

the highest are Some the Minneapolis the strong last in markets U.S., year. rent of and for including that Detroit, growth experienced presence Greenville, space we have some These of Chicago, markets in. a largest manufacturing

While STAG manufacturing this to demand for to is distribution drive direct minimal has facilities. exposure manufacturing increased plants, further activity warehouse expected

XXXX deliveries X% totaled stock. approximately of

While ended quarter's the being X.X%. -- vacancy above is last the existing last at expectations supply a absorbed year rate, healthy at year

nationally approximately year-over-year While supply remains declined by QX have a basis XX% as on of elevated, XXXX. of new starts construction

rent In addition, be peak the still year-end. forecasts market mid-single to for to half XXXX with to are the expect the Vacancy the and term, will continue normalization rates around but expect of in just expected for occur portfolio to of stock. for We to near digits we in likely XXXX our deliveries decrease sometime X.X% XXXX, in second growth XXXX. rise

in cash We and leasing to of XXXX. XX% report XX% and are proud spreads straight-line

million square today, leasing XX% leasing at or accomplish XX.X%. X feet to XXXX of of expect As in achieved approximately cash have of spreads we we

development. and Moving to acquisitions

As hold the for discussed transaction on call, put rates part of spiking XXXX. our the market back latter last interest on

of and X.X%, X quarter X.X% for of This straight-line Our acquisition volume cash $XX.X totaled the million. and rates fourth consisted with cap respectively. buildings

high-growth the both below submarket. at square within in offers proximity XXX,XXX location and its building well cap as vacancy In infill within foot of Reno, as million a mark-to-market years I-XX, a XX% market of weighted X.X%. load of Reno, reported with building spark building front the to benefits average term for a a $XX X.X close opportunity lease rents, low approximately Nevada, from October, central the rate STAG closed on a Located submarket

closed newly cap STAG stabilization. square rate developed October, of X.X% feet at vacant, million upon on in a totaling spec for Also building, $XX.X XXX,XXX one

we one this development South As to frontage in on also $XX.X Carolina, for acquired located transaction, Spartanburg asset with part in buildings million. on direct the visibility County, of are I-XX. The well adjacent

to both the deal market rent source a failed and below-market on closing, perform, diligence the assets buyer allowing downtime. able the to to the another to opportunity immediately building, STAG ability signed a at lease STAG's off completed lease staring building full our after and a underwritten STAG us was basis. exceed buy after negotiate gave to

There's building, the XXXX. second second good has in construction activity date square XXX,XXX foot the completion on of quarter which an expected

Including and have X our leasing projects Southeastern of in million in and space is Greer. substantial U.S. completion performing shell the our office and located the to in in across work half a over of Activity out XXX,XXX the of amount and I-XX foot South achieved X.X the XXXX. Greenville, market. Inland project, manufacturing square development feet This facility, on airport, build anticipate the project building previous remains healthy, square X located project the we value-add next meaningful activity Port, BMW Carolina first we Spartanburg, We

The low well foot sizes this in date square high third construction, stabilization The XXXX. estimated buildings development feet under in approximately vacancy XXXX project with in align a entry with project Florida. to is of and market. These demand are suite delivery our X-building, Tampa, QX barrier XXX,XXX square XX,XXX

to XXXX. heading appears start in The market a positive direction acquisition we be as

fourth have We the XXXX. entire more of and deals underwritten quarter January in

more discovery market be still While there price XXXX. acquisition stable to in is a expect made, we some

for and With that, it Matts, guidance the to will who results I turn over will cover XXXX. remaining our

Matts Pinard

good and year, per totaled compared available distribution the of of increase Thank to XXXX. Cash for in for million X.X%. increase a everyone. for an $X.XX $X.XX XXXX, and X.X% you, the was quarter as share $XXX.X year-over-year Core FFO Bill, morning,

free moderate, debt of repayment, cash messaging, incremental other million This dividend dividends XX% the flow year-end past XX% retained previous investment after purposes. approximately year-end These from available opportunities, general our at ratio are payout and to corporate to with at we for XXXX paid. Consistent continues declining $XX XXXX. year, dollars

Liquidity rate Leverage available EBITDA equal the low in issued adjusted ATM end range, to the $XXX with forward of proceeds annualized below fourth to at net our stood inclusive X.Xx. run quarter. million remains at year-end, guide of debt

During which we was the the for square the and leasing feet, and generated quarter, cash XX% Retention million leases and spreads for X.X XX.X% totaling respectively. straight-line XX commenced year. of XX.X% XX.X%, quarter

in When adjusted of adjusted for downtime was retention backfills, for minimal XXXX. instances XX.X% immediate

XX declined in basis basis outperforming our of initial a Average decline. XXXX, same-store occupancy point XX expectations points

on of X.X a under of in Moving to capital share market $XX.X of shares to activity. a million our issued $XX.X $XX, forward ATM average resulting approximately proceeds of basis fourth quarter, price approximately we program end, a issued at gross forward gross proceeds million. In gross quarter gross in $XX.XX basis under a resulting the Subsequent we on ATM XXX,XXX at million. share program price shares

million acquisition we to match As $XX of equity approximately pipeline. development equity able our of be forward at used be fund have to to fund today, The our proceeds will discretion.

minimal maturing debt maturities coming up year, in are placement million There this note $XX with XXXX. a private

basis annual XX our record the quarter for for and STAG. experienced points loss points. NOI of below XX grew of another initial well representing year, for X.X% XXXX, cash growth credit in same-store guidance Same-store basis the NOI X.X% We cash

As portfolio. the mentioned healthy by Bill, we across continue to dynamics see

rental to incurred X.XX%, guidance in growth area. is by NOI average the range X.XX% same-store for XXXX escalators weighted Our a cash X.X%

We retention to expect XX% in area. XX% the

year. Cash are leasing leasing square renewal XX and to be XX% and million between spreads new to XX% the for feet expected projected XX to million of

of approximately mentioned, of Bill leasing spreads XXXX has XX% the As with been date. leasing our accomplished XX.X% addressed, to aggregate cash projected

on website. include detailed guidance to FFO Our and per Components in of share. guidance section our XX core per can XXXX which share our Page available supplemental between be is of Relations of Investor range the $X.XX found $X.XX package,

the to expect and cash XX Average expected portfolio between be is by We occupancy for to NOI same-store decline points. same-store year. basis X.XX% growth X.XX%

G&A adjusted in $XXX to will between leasing $XX and cash debt Xx a Cash to XX% range rate to net of spreads million be XX%. X.Xx. and to expected $XX Acquisition million. $XX Disposition is we $XXX volume EBITDA guidance of $XXX expect range and to million be a million. rate run And to with finally, million between between X% annualized million, guidance volume between a X.X%. capitalization be is

I turn now will back it over to Bill.

William Crooker

their you, for I to team XXXX continued and Thank work achievement goals. thank of our hard our Matts. want

extremely Our is team continues and environments. to platform. sustained drive value operating in well acquisition positioned all through our growth macro STAG for

to back With operator that, turn the it questions. will for I

Operator

the be conducting a Mailman comes question [Operator will with from line of now question-and-answer first Instructions] Our Citi. We Craig session.

Craig Mailman

market sentiment this getting I like to the a on we've earnings times on want positive the season acquisition acquisition that few the back to commentary on Bill, circle your market. margin. seems more It just heard

in have guidance. wide a pretty guys You range

what maybe going maybe today So And of thing drag have delays I'm closer and curious just and sort as on timing under about contract you we timing just that? potential on visibility kind kind same on of to the think of dispositions, the or potential of LOI that's redeployment.

Difficulty] [Technical

Operator

line. please Ladies and gentlemen, the remain on

resume please line. the Your Again, conference momentarily. will on stay

will resume Your conference a in moment.

William Crooker

Hello?

Craig Mailman

Hi. Can you me? guys hear

William Crooker

Yes.

don't there. Sorry. what I know happened

Craig Mailman

You question? Did over? to want No hear start you worries. me my

William Crooker

Thank this question. lot acquisition more market you. time your a we this year. did heard in I last No, we've confidence at said, had Yes. than the I year,

XX% of to to developments, value at sits XX% consists pipeline Our redevelopments, XX% Pipeline about add. $X.X billion. XX% XX%, portfolios,

than it is guidance, than We're typical we more I did do wider than little year. We transactions. last year. respect said, in QX we underwrote January bit the a With all acquisition more XXXX. confidence have more of to Like a transactions did we underwriting

us today. we be than more in being But uncertainty some just to last the said, expecting that gives deals back-end seeing all year. given did confidence lot market. It we're a With of weighted, are we acquisitions the more more

Craig Mailman

you under do LOI have kind or anything this to going close contract point? of And at

William Crooker

the wait Not put sellers of right year are to out until at sellers last year. deals the brokers were now. brokers advising end to -- the start happened of market to What and

have we a underwriting So been lot.

deals, price agreement close the think and I agreement, we're got get then negotiate on price you you the to contract to but some close. to got

of takes that months. couple all a So

nothing or year. as just So today hit of the agreement deals the today, really the LOI at start price market under

Nicholas Joseph

Nick It's Craig. Joseph, here with

more. Just one

like? point? You if And the impacting product on of range of obviously how high would the kind mentioned at touch I wondering the that fits you most digits. market what look and your at was that just markets price in into and just probably supply end given higher then low can rent growth mid-single the is that, the

William Crooker

better lower Yes. of I I X wide the a are markets some of so mean markets. in it's some see expectations range is smaller then it's submarkets really market rent of -- markets we you're growth that have growth. other it Indianapolis, are would market, Dallas, rent operate where that the so the -- box and Columbus, market going boxes, big markets, the CBRE the say to Tier

So the in with XXXX and box activity dynamic very today, first-gen sizes, having that being exists other space really and still more persisted demand. in more leasing slow big

So you I bit markets, box slower, market it when is distribution think other versus markets look across are big a the rent markets. little of growth it's the the some -- really

Operator

next of the question comes with Advisors. from line Street Green Tibone Our Vince

Vince Tibone

acquisitions cap more your of the leasing being rate how discuss spread you're -- risk? leasing where recent what one is the few on in taking A just risk in value-add market between spread priced stabilized you typical are core today? is Basically, transaction to nature. the Could

William Crooker

in the the would demand I on depends it market, mean, on depends I say Vince, market, Yes. the velocity. typically, the it

to XX from anywhere points incremental see could basis return. XX of You

that we ultimately, a that to buyer opportunity. that acquired wanted QX, deal deal That seller with year-end. under a Greenville wasn't get The market, contract the one was the able The in another the deal before was closed unique in perform. buyer, to was

XXX higher acquired stabilized. have that So we that about we for was basis otherwise gotten we acquired if transaction. than return acquired That would points

that the a at that I actually was stabilized signed was was deal we a That What the remarks on mentioned our in yield the X.X%. lease prepared underwriting. X.X%.

that and a X% X.X% a X-year cap at in there So put effectively with tenant lease, deal, escalators negotiated diligence staring rate. lease bought a

finishing deals back going as And the move those risk. to increase of court the have or developments putting to to points -- that every you more original leasing some XX start and question, a some at expanding you situation XX to when look take docs have some So back compared to doing stabilized in as your But work, different. these that is basis component, value-add of the further parking type deal. return truck out things, in, you

Vince Tibone

core? that curious all about It's bucket acquisitions are And between a more in your And from helpful. opportunities Are buildings also in going risk do of seeing of versus a should really how one the acquisitions, we just potential nature perspective, value-add just forward? you just you terms target or 'XX in the mix sites split versus other. more have think

William Crooker

platform we across our about great the have What's is spectrum. Yes. invest ability to that

So something that last Tampa, well in mentioned like with we value to stabilized we're lease more as one to add, as developments value acquiring risk we're redevelopment, just where year the the deals. taking adding

the on at the returns. that capital we're risk-adjusted to depending deploy So opportunity, going best

just And to on lot stabilized volatility in the part I on cost. QX, weren't lot the was not QX of market. of stabilized of of of were a QX, I see more There and debt QX acquisitions there stabilized we're just those say And acquisitions and market, that 'XX. -- starting the the opportunities. a now mean,

to deals, some probably going and that some hopefully, we there'll to there's But more but way it of redevelopments more stabilized announced year. value-add be to some to is will weighted my these stabilized more So be last developments deals. guess be certainly split,

Operator

Our of Bill with next the comes from question Crow Raymond line James.

William Crow

the what Bill, fundamental opinion, is might couple in Are cap to figuring is at vacancy they rising of Are looking Or and this a that your they on concerns the and switch table after higher? their in causing missed of bringing kind rates? years? the quiet sellers rates last for drift they mentality? period what that they back bottom

William Crooker

ownership estate, is peers question, owners overall stock. so I'll the mean point own real highly ourselves the do top XX stat some the And and mean, to said we've that out fragmented. to public the want but a is I Yes. about I industrial XX% of owners, including answer I our the of before that XX% of only

can is there costs. capital where stable, comfort have some And rise assets of rates, coming reasons or rapid to confidence more sell you in either the buy lot price cost of comfort with interest capital, year wasn't were to interest into where generally volatility borrowing an back happened in there your was that's there's uncorrelated past of So coming that asset. But capital market. appropriate the for now cost what rates, in And in or your once costs a then you in. an the

back are I to somewhat stable versus think gives mean, going interest past has So today, yes. -- a market? miss sellers And the I they're that based a market. they is the top X the of that X where because that I the price, rates confidence mean, did been selling XX-year the months, at maybe, on not price over market

William Crow

asset the But construction that X.X%. to development that costs -- is the a I where developed one in of into the how the acquired, the guess, compare were does turned you newly the seller? -- cost X.X% that

William Crooker

know don't if have Steve, that? Mike, I you

Unknown Executive

cost, at get. was get that we given don't could that we Yes. foot what that to we new I mean yield development feel costs. into at the above a replacement brand price The we total pure building. was able square were typically was per have visibility But seller's a that it

William Crooker

Yes.

I -- had this the don't costs, I Bill, think but had to and a land. the land some seller basis perfect the in parcels in you mean, visibility have into also always lower transaction, opportunity seller develop other of their

we a their our good were make risk. was where And add taking on value. that's to without any some this return opportunity leasing investment them So to for able

that seller process. the then through land entitlement the market and obviously the fair was than and where of higher So purchased land initially value the went much permitting

William Crow

there. appreciate I I'll that. it All right. leave

Operator

of next line with Samir comes from Our Khanal question the Evercore.

Samir Khanal

internal number, I it credit here but Matts, still you're occupancy how talk same-store, on little on assumptions? is thinking about a mean just shifting I Maybe bit. to year, good loss is or guide guess, a slowing growth X% about through the the Bill the

William Crooker

of which we're occupancy, average me, XXXX. From fair average -- to think We Matts, loss. XX coming getting in of Yes. had occupancy, it's basis the look XX year average to it about mean, pool bps. an we a we basis wrong, XX guide correct on about guiding credit last -- That's we're year we when normally down I points points in XX I loss, to I'm you at what -- was credit in We bit XXXX. is online if of supply online, supply XXXX And last occupancy occupancy bps. think come guiding absorbed. in our same-store down -- incurred

We have coming XX% down But another year-over-year. development X.X% online of supply are in starts XXXX.

we should those But this same-store occupancy vacancy guiding points basis loss up down. national And the overall, of of like, tick of year, feel year. XX both our credit as come and to points average year, the going through to when XX the for pool. back start I get So are we overall, near to loss move we're in end rates basis

really by some leases strong guiding close for rollover XX% offset XX% XX%. almost We're to that's rents XX% And again. our to signed We today. XXXX at of

So feel in good guide at the pretty here. same-store coming about is initial our where we

Samir Khanal

to you close as sort XX% you that, your that on just side. the power conservative I guess signing of like anything XX% of -- a XX%. are driving guides I you I mean, pricing seeing to are material? you Or being guess then what's like a here? follow-up bit, kind mean, little are I said, and to

William Crooker

down properties, the submarket we the teeth properties submarkets. to of I we demand those mean, make our fit -- this the in when it of part here well. fit those is sure is basic really and goes thesis And buy

is of So high. rents demand assets, push those by really type having to because we're able

to when XX% and in XX%. for of leasing XX% 'XX, is XX%. of signed, spreads as is our guide is there's why but anticipated going forecasting back leases time have said, almost which we at XXXX forecasted, I which for, There those lot to we're But leases of now half be our the are between a

about And XX%. think one same up time point last I that yet brought we're is year, don't we XX%,

last in ahead were terms of we of So year where we're leasing.

Operator

Our Blaine line Heck next Wells question comes of Fargo. the from with

Blaine Heck

Can capital equity cost bit investment? of debt driving expanded, you how that's of the today overall just or on and a importantly, your your of your about that more expectation? thinking gap Has returns probably talk and cost spread between what's required and little acquisition you're of the more about cost

Matts Pinard

Matts. Blaine, this is

can start I think debt. we the of cost with

on have You balance look sheet, there. our mix investment-grade at a we

and term We have mix loans a of primarily. placement private notes

the years. years, are X So those XX instruments tenures years, of X original

XX-year, at a particularly You recently, it bounced take the look around yesterday.

If originate XX-year. that's have a we in we previous the were the to area, granted, higher that that originated the today years, X% is to related what over a lot than of little X

If for retained look, after for cash begins paid. capital think this dividends the with really we funding year, it plan about allocation the 'XX, flow

As $XX million remarks, I my did we in retain last mentioned year. prepared

guidance. We proceeds We're expect to in dispositions do to year. to the retain have going same our well. deploy roughly have this as We asset those

important think I of we of unfunded us ATM. the forward And on have north then, That's what gross $XX. do is do at equity to price share million that's is a available $XX

that look to -- take under-levered then the at to a you take X.X. and range you X of So our balance compared sheet, a to it's

does on in So cost yes, right of what a XX our debt. now. And impact we we lot it with the need have movement of have an years,

Blaine Heck

guiding guess I or year? a Okay. above a little that is That to your Or flat you you push seems peers That's some confidence are that what growth this portfolio markets the better rent growth. giving growth and year. single-digit low be then that this might to guys just higher think helpful. your in of bit some are what's mid-single-digit or unique do And brokers you to projecting on rent number?

William Crooker

is buildings just some are buildings where XXX,XXX the prepared call -- really our mean, of it, is the vacancy above. the side Generally, to boxes, feet in things the square questions. we're submarkets in said and some where in generally previous I big remarks, I so fit now, And smaller well. But the on as vacancy compared and the our

demand. coming at drive way submarket, look you confident still years. -- strong lease on where demand to good some growth. when our boxes. the seeing and the buildings so seeing smaller rental the fit onshoring it's ability nearshoring And demand We're we the We're anticipating really then in the feel is, about And their

we Last year, came out. really out we forecasted of we well terms where in went and

we X%. high I we think digits the at we're this single starting north at mid-single or year to up year, of a ended at digits. it's the started year and little And mid- -- high,

a So and lot in ground-up analysis reviewing it we of confidence a it. have is a that team spends time of lot our

Operator

Our of next question of Bank from Camille line with Bonnel the comes America.

Jing Xian Tan

big the address half? to market? near-term weighted more outstanding XX% of you any XXXX? is expand you leasing have back in versus there Can How in on are any And much less that concentrations one

William Crooker

box. -- big over last demarcation No we're to I of of one why XX% kind small I close and leased square which box, this concentrations we've our which XX%, think, big mentioned any More call, our nothing is it's XX% is of feet, to on in is No spreads the for XXX,XXX amount back-end of too, the leasing market. just to line date. coming range weighted, in

more at year, Like -- this and But are because is. if back-end why XX%. it our we earlier, now time we're we're that range of said, about where I was XX% last it's is where it excited to today. that's weighted, close really So it's

good really activity on there's So that.

Jing Xian Tan

operations items your second lower than the to And a expecting. the cash sell question, in came for core you look distribution, and in for to available about very was to But bottom side we place. X% get my line as non-cash-related this for solid ended the adjust

So would FFO I growth about year? this how wondering CAD this we your the think And to was be similar guidance? in X% should

William Crooker

Yes.

And on NOI sell a where gross same-store our on in this up for have cash there. for was came thing, was a which But I your one X.X%. and X.X%, side distribution, us. going think the just I'm guys for comment models not own at you number, comes, record So to CAD our year, available

you've got number $X.XX CapEx, that some NOI. to of anywhere consistent has CapEx from -- year, $X.XX Every in That pretty with nuances per cash with foot. So pretty but averaged seems square our terms consistent. in same-store

Going forward.

you of as it think about when NOI. of think it's around NOI, I X% a percentage

that number pretty consistent. So be should

So still CAD forward. going some strong we share growth I think per pretty CAD can drive and growth

Operator

question of line with from next Carroll comes the Our RBC. Michael

Michael Carroll

active I I a projects, in right set prepared that is the pursuing the XX% said mean, was, know remarks, I what, Bill guess, development Guess few here? of lot earlier developments. you now. STAG pipeline the believe a what's there opportunity I of

around I exact so you think you how not tied do what a of many number But I'm I lot how numbers, is Or XXXX? the pursue threw think sure you want to really activity? if to the you mean, do that was XXXX? projects. development pursue many can in in the

William Crooker

It's question, some I around lost information apologize of throw did if kind numbers, Mike. lot got of a so I there. a good

cost. of the billion. Our the a range XX% redevelopments. call pipeline Of wider Part includes billion developments, mix but $X.X value-add is of XX%, is it's that, to of sort range, $X.X land it, some pretty wide is only

$XX So if our $XX it's pipeline project, it's a in today. -- that's million million of

be We are almost We've we ready should and development. haven't And of -- the one that we've up right? we've just got complete that got now, are development specific X end starts, So on guided more by Port the that's XXX. then QX. here got projects, X wrapping Tampa acquired ongoing to the that

that as some parcels. some anything are evaluating for. there. some we're have we for opportunities opportunities anticipate in to be don't potentially there's some excess that And well, We underway. we we're those price right And agreement and the negotiating looking So our there'll year do own have now, subdivide land those portfolio of --

we that, not, insight have guide not into we know we We're projects. up let this to have XXXX. just giving initiative, we're certainly this But for at and these we point, comfortable those specific we'll projects, as of it. clarity into everyone you as guidance will more So ramp as more

Michael Carroll

before. does capacity in you remind portfolio? you you us on give to then Does you And leasing? on Okay. developments to what the provided Great. that to pursue believe I pursue limit developments get your us to of change starts? are within more that And So want that leased. of some limit can these process based more

William Crooker

of of I then way and some than we're on that some the as were And less do kind peers obviously, just cap. soft up rights in view our as We limits internally. delayed. case less tenant of that outstanding up it's developments, has it opportunity. out is Yes. The it we ramping depending project have it build-to-suit off mean, we certainly lease stabilized, the something that of gets bow a risky, that to is drops

tenant to not build-to-suit for guidance out the certainly to be we're impacts riskier to limited for of we'll right now, with internal rights bow more we the obviously, sort starts the a caps, have. soft Mike, a that. of we're So project, the But But will of caps than cap, right it the close providing close specifically. and now, capital something future little very more the bit any be in not

Operator

Our the Baird. with comes next from line of Thillman question Nick

Nicholas Thillman

basically composition here? bit be guys touching that that, portfolio Or the going dispositions just like as on concentrate and we that Tier trying are in you to basically just putting and are pipeline? for the market the the viewing a of just of kind acquisition -- to kind X little you the bulk is this of are or sources Maybe is just write-down more of of that non-CBRE kind

Matts Pinard

Matts. Nick, Yes. this is

guidance capital disposition noted, it dispositions. is non-core opportunistic between million, accurately mix our million you and of to a recycling So as $XXX $XX

good inquiries reverse Look, in to our those mandates, disclose. was cetera. it's it the mix they generally the and opportunistic, bottom think et on the real of a X%, the And corporate little view XX-XX. don't differently, on are flip of expectations, portfolio part always about think different the we'll the have side, roughly you users. from They kind estate XXXX, If just there's a extent we

reverse happen inquiries year. little unpredictable. every So They're a those single

called is the split history. that number. XX-XX reasonable, there think So a relatively our is unidentified given within opportunistic But I

William Crooker

properties. legacy those pointed And dispositions you correctly are X The Tier non-core out. primarily think were Nick, that non-CBRE I markets

Nicholas Thillman

you underwriting larger, they what helpful. on on box similar? smaller and little And a there properties pricing touched still maybe Or you're weakness guys maybe is between a are That's pricing in demand. maybe those seeing the just in versus a on pretty But basis, bit big stabilized like acquisitions kind and of the big products? differentiation for

William Crooker

got so to box going that's have that much I obviously, X-year could than to escalators, X.X% a mean, too. into that that's lease going a there's small trade is escalators. the much XX-year Mark-to-market, small differently has be You and and a goes right? pricing, X% Yes. box lease impactful a and

got If X-year leases. a that that historically think with X-year small in big to some boxes box box got market, I strong market the a close a you've pretty leasing big that's a been trades of has lease

really trade if got term, the and property, well it's the fits the submarket think -- going enough pretty it's to I It's building reasonably.

With are deals -- to deals just takes They're coming price out. We're on close. still these all come coming hearing time to that being for said, out. It deals some we're agreement. some

in closing. others of and of will it that deals as certainty more give to the these and So next months, be think couple all will are I vetted us where

Operator

Borden Eric BMO next Our line with of from Capital comes question Markets. the

Eric Borden

be of the is future the could Just funding disposition theme, the to Tier X markets sticking the portfolio of much that of for legacy portfolio non-core with how sources? non-CBRE left disposed use

William Crooker

Yes.

portfolio. quality and of our X% our that we we that disposition X Tier circa at point we is our portfolio generally look I want improve to for part like non-CBRE have that really of out to So not portfolio a But evaluating of something non-core are constantly is do the we do portfolio. that the is portion of

Eric Borden

provide of between Matts the the are the in into growth just Okay. a bridge of X% the FFO That's puts then midpoint some Could for just one potential the X.X%. guidance. Or And you and helpful. What there and guide? to implied there built maybe is conservative core any same-store on takes drags?

Matts Pinard

know, projected debt the And Number year. X% little grow Look, is we're G&A interest that's year absolutely. our are as a At one other to is midpoint And you to guidance, there going Yes, compared X G&A is expensive of drivers. then balances. more last have higher to expense. average this the and as now. G&A

the the The average roughly took out years, point do the look that and G&A, want you one is point if a scalability X on I X%. past growth at to

That's G&A what's in X%. part delta. grow bringing will that of So guidance

William Crooker

that Yes. Maybe store guide same-store to too, a number. is on really the one same is point that, cash other we

you to when core the number impact that number. about GAAP So a that's less. FFO, think typically, And is

Operator

[Operator Instructions] with Mueller JPMorgan. from Mike line Our question next comes of the

Michael Mueller

Pretty much everything been has answered.

completed returns development one are returns, where relative developments I taking lease-up one how kind they those risk, maybe So of underwriting different look? spending about the you're I not you're just or can guess, When buying mean, those but you're and it? different property Just capital how to to be though. a they thinking quick do the

William Crooker

Yes.

increase -- risk. to I mean, think way I process, additional entitlement all stabilized buying the go a land you're to with raw as permitting acquisition returns take and returns and see the linear, X-year -- it's buying projected a the going you not But the if you Mike. up through going through lease,

taken over being solely risk, years, on taking stabilized from not development -- and almost on We've, the now through on acquirer a we permitting have but entitlement taking risk. and moved

points, deal to when at XX return. the to just stabilized risk. about XX take And permitting basis to points another XX points if XX XX another think to that add the on were So XX I take basis it's risk, on of you basis a then and development lease-up you taking

becomes So additional -- risk additional all time. but and with that, it

Operator

would time. Mr. back no for Crooker, closing floor questions the to this turn comments. like I over further have we you to at

William Crooker

for want for for forward all to look the soon. seeing those Thank analysts I that just Valentine's questions, I thank care. all call. Take Happy and celebrate, to the you the you joining to Day. everybody

Operator

conclude and teleconference. this Ladies does today's gentlemen,

Thank your at a have may day. you your this You time. for disconnect lines participation, and wonderful

STAG Industrial (STAG) 14 Feb 242023 Q4 Earnings call transcript