PGRE - Earnings call transcript Q1 2024

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Operator

Good day, ladies and gentlemen. Thank you for standing by. Welcome to the Paramount Group First Quarter 2024 Earnings Conference Call. [Operator Instructions] Please note that this conference call is being recorded today, May 2, 2024. I will now turn the call over to Tom Hennessy, Vice President of Business Development and Investor Relations. Thank you.

begin. may You

Thomas Hennessy

and operator, everyone. Thank good you, morning,

found we our first I information, Investors were can section like at Paramount Financial and www.pgre.com. would to everyone which be Both yesterday. website point of to released the quarter the supplemental heading Results Before the begin, under Group XXXX at the release earnings

within the federal of of comments Some meaning our will the be laws. forward-looking statements securities

expect. or Therefore, results as other usually risks identified impact our by use will, Forward-looking our interpreting to to expect, such SEC risks we relying you could filings should and future materially for operating that phrases on could results detailed statements, uncertainties are in financial the which and what numerous similar them. of the subject to a condition. We are that of words you exercise from should refer and more cause caution discussion differ actual

over substitute will Estate. our the believe discuss the call to to remarks, During Officer not which useful Officer we Financial Chief open as measures in our to Chief for the comparable most and of the supplemental Executive prepared Paes, These our information. Hosting operating be earnings the we Treasurer; XXXX call be Behler, a Brindley, evaluating measure Operating have GAAP. should and accordance President considered opening first Officer, Vice release I Executive of Mr. call Chairman, today, we GAAP that, will our Head we Management isolation can Albert. and available will call, some the performance. Wilbur quarter Chief Albert the is Peter company; in directly and these Real of provide President, or company's and questions. With then turn financial will non-GAAP measures, A reconciliation with results measures in in

Albert Behler

for thank Thank you you, all joining today. And us Tom.

are as share $X.XX off start in excited share the since core which it XXXX. last Though for to are reported progress per Yesterday, above hasn't spoke, strong we our quarter, $X.XX we we we first to been long of a consensus. FFO was

of quarter quarter From had the fourth our for quarter into an operational as of the terrific the momentum perspective, we feet. well. XXXX in since carried XXXX. XXXX about had represents we and in executed first this To first leasing a it We square of XXX,XXX put strongest of leasing leases further standpoint, quarter

continue occupancy. in showed and We XXXX make Avenue Sixth the Sixth to corridor. availability XXXX leased our in uptick progress Both on Sixth an

the measure This, lease XX,XXX-square-foot Sixth driven strong portfolio basis Paramount Sixth full in course, meaningful to thrilled at any with XXXX We continue increase the leased While Citizens add Bank. to with ability environments. Citizens most Bank roster. The XX.X% continue of we fair quarter to saw of tenant strength activity Class the and and market. in of continues of up New share market York leasing to signed that in improve, types The high-quality are different a our assets than to quarter to XXXX welcome leased, by are the activity leases A the that by outperform the was XXX in pick is during the this we more our operating all occupancy. and their increase to testament point a we new our

to Our robust situated attract tenant continue locations prime demand. class-leading in buildings

employees. ability Paramount experience headquarters becoming at broader of be to of strategic differentiator offerings York to Club official our Din and of our on quickly by to and also buzz amenities the our in Michelin opening our Fung Broadway. an New the in and level activity This star-rated has leasing office to on-site York in portfolio. anticipated, quality market work broader we attract plaza positioning York Avenue. exclusively Tai remain to clients encouraged undoubtedly this quarter the of excitement the the throughout are Tenants XXXX We exclusive about tenants our by carefully Club Cube our continue availabilities. Today, office for opening, slated across announced is Club of providing tenants a leasing in a the market and iconic the happier. is Paramount offering execute is members-only under their aided our open the curated drive top-tier New key portfolio leverage and XXXX Glass club activity the couldn't for and highly that Sixth XXXX in to will our suite Paramount New ability created at portfolio. Adding retain we that confident unique the tenants, the the elevated of to enhances at our

and attracting not in good as starting and the certainly is same New at is become While vibrant. The news in market that the the carry our more will high-quality located, Francisco York, pace day to assets are amenitized San centrally tenants. modernized, that

Peter leasing approximately quarter, the signed XX XXX,XXX-square-foot additional including KPMG pipeline. During short-term XXX,XXX Second feet of provide at color square will Street. with this on leases, extension a we and our

$XXX testament sponsorship. call, we asset and modification million by This quarter, is the X Market million loan reduced million and terrific and paydown we of quality a loan modified As the was last the One the at during and to extended a by result $XXX commitment in Francisco. Plaza of mortgage loan San joint to $XXX the The venture. a years following was on the the touched existing previous extended

we and XXXX. is quarter, on to May This set Street. a resolution in mature with modified loan the group lending now reached XX Wall extended The

allows greater financial will and will standards discuss appropriate Wall plan. the to us in partners the redeveloped runway assets XX term of will execute redeveloped our in financing to business standard the extended redefine today's the our district. be the detail, Wilbur While and

website our out buyers replace muted, the transaction which building. is dynamic the ample into also underway, prospective redeveloped encourage pick market the information and It existing will base has remains have sidelines bid-ask that the of to We begin the and Pedersen glass white the new facade I though Kohn for grand kept believe The to for XXX-foot-high the a the light will the feature sellers fully in designed coming to vertical green and podium a has by narrow. regarding will volume check new begun still to broader market. will allow year more up. to on redevelopment The The assets, environment of been you deals floors a project. Shifting spreads and that Fox wall. as staircase the ahead on facade natural become many environment have additional

in assets to market which longer coming could rates an distressed as foresee around expected. we interest opportunities be the compelling present than bit Additionally, may a acquisition increase elevated

and allocating together opportunities capital poised remain investment with We our deep leveraging disciplined in towards growth will and, and external third-parties, approach. market judicious only expertise

sustainability. to Turning

proud totaling STAR is have consecutive XXXX office the our from to the our ENERGY square of feet. been and testament a of commitment of EPA efforts million portfolio, announce XX.X Energy the to are our sustainability we year. for Year across XXX% awarded the STAR ENERGY that labels achieve Partner Award This to third We the Department to and

real costs that Executing a environmental is mission estate on impact owner. our operating initiatives responsible core and reduce our as to

this collaborate sustainability with the efforts. ENERGY our us Our who both exemplifies benefiting tenants STAR participation on company program the these in commitment, and

importance confident XXXX quarter and and us heading. Upholding of of performance elevate ESG in priority we tenant paramount tenant the for are executing strategy ESG are and a key portfolio. In will practices this our strong across continue create us remain the excited gets as direction to our and long-term base. shareholders experience about our our to strategic closing, value on the we principles

are Our the Class A gateway markets resilient. coastal buildings which we and in operate

Peter. the I over call will With to that, turn

Peter Brindley

good Thanks, morning. and Albert,

weighted first signed the approximately with first was the average and in in approximately feet San years. XXX,XXX feet leased feet Francisco. quarter, we During term approximately leases of quarter square square XXX,XXX during New X.X square York XXX,XXX The

Our of Bank XX-year New Americas we lease by an with was the XX,XXX-square-foot for activity at Citizens York Avenue term. highlighted initial XXXX signed the

trend existing Paramount with the are increasing tenants, a tenants we with addition seeing Citizens In York firms portfolio, New number to particularly to York, New expanded Bank welcoming we in law several of an largely quarter a a lease growing lease driven Francisco, and AI-based with XXXXX-square-foot with extension we company. completed companies. first KPMG the and was our financial completed In XXX,XXX-square-foot we service San leasing by

and by two We evidenced continue execute as to well-regarded our well-capitalized quarter to centrally run first best-in-class, owners. performance. choosing buildings amenity-rich markets, prioritize business our Tenants continue solid pursue in located, plan, our on highest-quality by assets to the

positioned portfolio to on capitalize trends. uniquely is pronounced these Our

in focused our over a the tenants, our is and with As leasing growing. delivering existing vacant several years next service on pipeline We space expirations tenants our result, remain renewing portfolio. to exceptional

square XXX,XXX leases have for space. for or advanced-stage a portion we feet, which good vacant and than in is of vacant negotiation a more soon-to-be proposals Currently,

various the pipeline square grow continues stages. our at to XXX,XXX Beyond feet, ongoing with negotiations

same-store rate our XX.X%, end, quarter portfolio-wide year-over-year. occupancy was and including noncore basis down basis down quarter from points At XXX last XXX assets, at leased points share,

feet we year-end. expirations X.X% of expiring annualized lease with are rent our manageable XXX,XXX share approximately As ahead, at look remaining or square by

Midtown to public continues pursue most increasingly for surpassed markets. estate the Midtown's in transportation. real XX.X% since quarter. down in X-year to elevated average approximately to demand XXXX. Midtown the year activity tenants Sublease strongest the the of Midtown proximity as in quarterly at QX X.XX set high second has quarter submarkets million first core Availability Turning slightly steadily from feet, excluding to square February Midtown's The decline, absorption start XX% close highest-quality the in consecutive our was XXXX. quarter and and with within negative during the was improving the remains renewals, Midtown profile first been evident leasing in activity

our belief our our York in today. unmatched where from Avenue room, podcast, to portfolio top-tier in of the our in the are are the lounge, wine center hosting a our offered Tour to launch growing in York has project opportunities tastings wellness This and conveniences the our in atrium Paramount and Club in attracting and choose. tenants of of retaining and a enriching in portfolio. the the prospects thrive and demand existing for and classes we portfolio. conference, which Paris some community, Americas, not experiencing members-only just is to York members activity The tenants high-quality continues XXXX recording isolation. experiences. a in accelerate, New Membership bar New watching connect at serves been can that enjoy Paramount enterprises game A central which embodies Club Olympics tailwind New Dining as market-leading the assets hub of opened

leased XX York currently basis same-store a points New at is quarter-over-quarter XX.X% and both basis on portfolio year-over-year. share, Our down

X.X approximately York expiring square feet the to manageable, XX.X% square our XXX,XXX of the rent quarterly approximately the expiration above Francisco. is XX.X% average preceding XX-year lease San Francisco share year in Our recorded with focus overall at or year-end. Shifting the quarterly during quarter, profile million average New annualized first but of X.X% by period. feet during and below pandemic leasing San

demand entities, availability, necessary become market increasingly build large which has demand has market the Many by larger return part requirements fundamentals. to the coupled Francisco has requirements feet, grown San to of the been and for been are requirements of This healthier to particularly to companies. of the San absorption funded pipeline in Francisco. X more AI is it in Tenant early-stage which have XXXX. the since Francisco-based with QX emergence AI-based will highest newly an AI million than San contribute These driven for percentage increase the space, these square of

in challenges San with for Francisco potential. high-growth premier a market, talent Despite tech hotbed remains the

is to continues positioned market in capture the as share recovery well outsized high-quality Our portfolio Francisco.

quarter-over-quarter, basis points year-over-year. XXX share, quarter same-store a was Francisco down our XXX leased portfolio XX.X% points At down basis basis at on San end,

progress. With our share to ahead, X.X% approximately on annualized feet portfolio will over Looking you firing Francisco the that Wilbur, to by I We San results. who the square updating look call turn will discuss our rent summary, at financial for year-end. of has XX,XXX forward

Wilbur Paes

good Thank morning, you, Peter, everyone. and

the we core and year's growth on first of cash X.X% to portfolio basis, GAAP a the prior The was share, and from $X.XX by lease which expirations expense. $X.XX quarter. interest estimates negative Wall driven prior on Yesterday, higher reported FFO quarter due the year below Street above consensus X.X% scheduled per first in basis of is $X.XX and $X.XX same-store a decline primarily

Francisco cash our York while a The X.X% on of Looking up was same-store San X.X% X.X% a basis portfolio GAAP down each portfolio cash results a businesses. down GAAP on of and operating the down New basis was and basis, X.X% a on the basis. at on

a of cash at During the Mark-to-markets completed space and square a starting XX.X% first basis and was feet weighted X.X negative weighted square years. X.X% on square negative for of rent second-generation foot average we on feet basis. of a lease on XX,XXX average quarter, $XX.XX of XXX,XXX leasing GAAP per a term

short-term XX.X% The lease negative mark-to-market in KPMG portfolio. at was Francisco Street by the San renewal GAAP driven XX our Second

recall, lease valued was XXXX, in may was and acquired the required GAAP. prior acquisition, back you at the asset be time As this with fair accordance in of to

straight-line So fair adjustment. essentially, three value rent the of FAS a XXX FAS a value a was cash include and GAAP rent, rent GAAP rent not XXX does prior The adjustment. components: comprised the current adjustment fair

So if from the the been rent, FAS mark-to-markets GAAP you negative exclude adjustment the have were XXX value to prior X.X%. would fair

XX the more and active Street. the We our had previously very a extended million Wall One loan front. Plaza recently, at at and, the sheet. Turning to on loan We balance quarter announced $XXX modified financing Market

have In out average in fact, their of X.X debt and $X.X over small and over billion environment. X modified we maturities over markets capital weighted years, feat extended this months, pushed challenging the maturing no by past

Wall, will XX SOFT $XXX modified B-Note remaining XXXX. will At at but accrue million The interest the X% plans for notes and XXX, the and the pay, the to at The plus a A a by B-Note bifurcated invest to which the XX%. asset only the approximately reposition of joint million PIK interest earned A-Note to is our PIK extended fees The to is current A-Note asset, prior loan million and $XXX any was entirety May was on maturity B-Note, management, the is and accrue be of PIK. is while and and $XXX joint approximately development invested both subordinate share, venture. million. interest The the venture B the equity X% $XX.X will to into

year-end, cash down ended quarter by Plaza. restricted of million is our Our $XX.X with driven share, which and One strong. of Market from the the loan remains liquidity position cash $XXX We at share at million paydown

million of under our have bringing revolver, full We billion. total approximately $XXX the to liquidity undrawn capacity $X.X

both the weighted fixed of was next floating outstanding interest due and we rate include years. average of which debt average average a rate interest XX% come at and the These course, remaining debt debt of of X average X.X%, assets X.XX% is end our and designated quarter at has X%. a weighted the weighted has as maturity weighted Our $X.X billion and a X.X of a XX% of rate the figures, noncore, interest months. of on within XX is

on maturity debt Excluding debt average the until debt the no weighted years. noncore maturing the years XXXX the remaining increases X.X assets, we X.X of have from and to

In helpful. have investors assets, Sutter Market additional operating our supplemental provided effort deck. hope X and The find financial throughout help additional and the in to as you assets these light an of Center impact performance. designation investor disclosures we disclosures additional and disclosures XXX provided the evaluate of our We noncore the on of are package

first our our for including our the underlying of outlook assumptions. guidance, year, updated the remainder of results we on as Based guidance. the to have quarter as some Turning well

our We feet. XXX,XXX guidance to feet leasing the at have XXX,XXX a midpoint range square XX,XXX increased to of square by

$X.XX largely increase or that, midpoint. fee have operations growth at our NOI driven to per questions. share basis a please and share by The $X.XX between NOI FFO cash share higher We core income. With per core portfolio and points increased for per and assumptions open the and $X.XX increased range our FFO have midpoint. in lines other the was guidance $X.XX the same-store And same-store by lastly, at midpoint the operator, better-than-expected at we by XX

Operator

question the Evercore with of ISI. first [Operator Sakwa Steve comes line Instructions] The from

Steve Sakwa

the on the pipeline, the leasing and just expirations. Maybe starting with Peter,

help move-outs occupancy in some of year upcoming guess, the, to expirations. you that kind the the you end this Or through And think can on that? that the the in I stuff of us Just year? of pipeline, leased some downdraft maybe that in still known that of think cover kind the is order do there's by signed get

Peter Brindley

say of large of that is significant be percentage move-out. of start percentage XXXX known is specifically But XXX,XXX-square-foot referenced, move-out the Chance XX That's XXX,XXX Steve, Clifford and XXnd talked of of We've New our lease XX% at that of I'll of in square to a pipeline happy it in amount York. vacant the New in known significant roughly will space, expirations. the is West That I'm I just Street a that about York based Clifford vacated by on space shy feet. a Chance.

of We have the made significant JPMorgan point, it's this also San and talked in tenants to are in At working too mitigate relates up tell. blocks expirations that Francisco. about San relationships XX% I've Roughly in as course, XXXX in the fact very But our Francisco those Google. very of role San to our to risk. got we've are larger lease of good We, we're soon with mentioned, of past some it that and expirations. our hard Francisco, enjoy the as

We're with now better Going quite New for we square In that Midtown leasing most for seems feet, is in to X/X feel X would tenants a really in user our we of of the be first time. in quarter. velocity in to XXX,XXX Manhattan, the the I have specifically XX% accelerating, the are a active minute, some specifically, deeper, of Manhattan, the if excess been roughly feet, about activity than for the in in in little market but growing. say, in approaching first it the in feet encouraging. pipeline you of markets levels. submarkets Midtown core just not delve major leases the quarter. really we've a And excess out, productive, the XXX,XXX of it's accounting seen we demand accounted XX in Midtown the of which square have, back XXXX Midtown, seeing very York XXXX, million Interestingly, pipeline And on square has pipeline and about par Manhattan,

So we positioned. feel very we're like well

feels strong. the to We're I and that that expirations focused pipeline mentioned on the 'XX, you 'XX in up Our exploration into are big 'XX, that very big just now of profile. and roll blocks ones make the

Steve Sakwa

the the X mention you have anything banks? maturities the of assets plan or on, deemed the is still sort of give Wilbur, right with noncore. those much back there Is just kind did assets on that you could the moving keys that that us upcoming in hand Albert you at point, Maybe this the terms of Or at it to your discussions pretty time? that

Albert Behler

parents. Steve, the let that our we've sheet. And the family. everybody our Well, say -- said family again, me last consider on balance don't consider basically on have from assets it call, like from a sheet, we the X, the I I come of a debt know any portfolio you same got balance I'll and

Some developed assets. develop nicely our the of that with that's some and them didn't same well, others and

So so parents, you only that's being. the time for our can your assets how expect we and much treat from

Wilbur Paes

if go Yes. been X Steve, add, the I'd only hand and these say, goal wanted we to assets is thing just look, back. have never think impaired. dimension to is Maybe I that I What the the keys

owe We are that sheet. optionality. preserve maintaining shareholders, that try We our balance and owe as to ourselves. investment, have while We the lost to our going we to that of strength to much

discuss to there forward. way continue is see the if lender we to a to move think I So with

before preserve income think a REITs fee we solution, fight If optionality and only On risk cash us live I XXX balance flow literally, that optionality. our the helps where we day helps come as loan sheet that is another probably of executed no Sutter, us optionality. that side, there preserve can I a that one an think to to we're with the up and on

to evaluate So we're going that.

knee-deep and discussions. in continue We

it preserve we that whether I shareholder think some on before next optionality of capital. quarter, to should being type mindful asset is the back more the handing have keys of being resolution, while able or some

Albert Behler

of of rates. are And are our favorable And really do the helped with relationships. last negotiated team that our and that's partners, I straightforward with very marketplace. the we I good has Steve, shows, forward that's we full where what got think we going again, they that's, that what information. And we us and in I think, all transactions very going at we the to debt couple in as to extensions And providers, interest And have the be what well. like get think, respect

Steve Sakwa

Last question me. for

on Francisco the Just San transaction York are Albert, in picking I past. looking New I'm in you focused sort know mentioned distress things up. market of you've the curious, other and you markets in been opportunities? at solely and

lens Or markets? and New up to D.C., at So Boston Francisco you would open or are again, York? you exclusively the looking other San

Albert Behler

York. we being, For Francisco the New are looking San and at time

had and have We mezz D.C., there. market offer that. will think write-down don't or seem fund an San see that investments, on doesn't Washington, in office all and early, New being. still the I attractive and Francisco be we for are but opportunities will investments to D.C. we opportunities And the mezzanine We at time focus there, York

Operator

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

Jing Xian Tan

to Sutter. wanted XXX on I clarify

mentioned outcome the quarters? few a Is that an there any expecting You you're plays out risk next more this few weeks. for in

Wilbur Paes

don't have Right debt is is that now, we to accrete all The cash about there and partners. is principal still where is know balance. nonrecourse. to our what maturing I shortfalls flowing by think loan I When us the no we have mean risk. what risk Camille, you a risk,

Paramount's Paramount's Paramount balance effectively the from favorable similar is extend outcome would we then books assets the it sheet. have The our are a contribution comes off tremendously continue possible to no outcome because limiting is So back. which and asset debt there I goes this to optionality to balance while the delevered there preserves is And in that does, its for a if sheet, to risk potentially is any these Paramount or Paramount's right earnings and and shareholders risk structure, in shareholders outcomes because no think its scenario it se per we in now.

Jing Xian Tan

on that clarification. too? is Showtime's lease you the that, be out, going lease will but parent I that probability conversations Appreciate have started company. there's further a know bit And And lot any there? Okay. any with a extended,

Albert Behler

that's Camille, And want be our constantly Showtime and tenant our tenant-friendly, is communications to there large we very all say XXXX in talking, asset. our plans early think with property of one what leasing management But is consistently tenants. are that so a strengths, time. We the are there. I our communicating too to it's the are

We space, to have very other might good but XXXX additional to by potentially at have tenants too demand early it's who want details. go into any

Jing Xian Tan

finally, more And to of just the it. XX at short-term Got wanted lease get KPMG's color renewal on Second.

took on X longer for a Just you have further you do you details more or offered year. any lower why renewal they gotten lease? could think a And if conventions, rent

Peter Brindley

Camille, this enjoy and good relationship more know XX was months. It a was KPMG. year. with very a is than Peter. It We

and to to I we But think very both say was that acceptable were sides, the going a was this to how happy too once again, time deal plays soon being, it's make forward. out for the this deal.

Operator

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

Blaine Heck

Just wanted interesting near particular recently. in all consider that in future? to retail side, dispositions, revisit the given we've the Is the on seen would trades some relatively kind something of that you possibility of

Albert Behler

in are, as with market we the know, Well, you XXX.

vacancy have some We there.

new which the done combining store, a parts to of lease XXX the space neighboring the the XXX. in the job, lease a beautiful property wonderful under And currently part Winston, doing have rest construction. Harry XXX They're We with so terrific is of it will and currently retail a lease. for market of be is and

did are taking to a very rates, time we well retail And the retail. don't up the our with interest space in on significantly. is healthy like think really arena. our for There's coming about I comment in I because demand Rental retail regard favor. Fifth by to dispositions Avenue, coming

We have there's discussions but off talk at nothing about earnings call. and this on, to

Blaine Heck

ruled just extension. to had your move-out. like seem And something that didn't was potential quickly come impression the said It changed a a commentary known Showtime. back previously under had Great. Has that you been I there? out to guys

Just to sure you wanted heard I make correctly.

Albert Behler

of they last it's and relatively we heard for it's extension. don't will wanted I do by out, place, another rumors or just because taught experience And cases shrink year early. with they a or and business grow change No, on. example, many it My they and extend were their out mean change move there that M&A this in example, had me KPMG, whether in we corporations going wanted has mind sometimes couple know we another times, banks XX large moved mind that their to that months. within to have now different

So to tenant. that think it's early I give something definite too about

Blaine Heck

very Okay. with quarter. to can last what be they're commentary about just talk Got is leasing fair. you seems on you one, Peter, guys can It you. That's elevated seeing respect the little you're this concessions? if that to high, a them. afford Market did landlords even to pay

on at through TIs you're continued seeing that's plateaued this or talk whether those can maybe just and you upward pressure So dynamics point?

Peter Brindley

have slightly say It plateaued. would that elevated. I be Blaine, may concessions

on was you're the York gave first to quarter. I in completed New transaction think we what specifically against in the referring floor. the That second is concessions we

don't generally. based all And so that concessions much on rent vary

it for levels. elevated slightly quarter. historical They've case they at have that's gone the being that all So stable, remained things considered, But are be reason forward. I are not they but high, up and the the recently. to in going we think expect They

Operator

with Dylan the Burzinski comes Street. And Green the of next line question from

Dylan Burzinski

put from go to your makes think guys go wanted you and it to to of in some I at on the putting what for an of out to pull it guess, holistically comments simply another to actually out and looking before the existing acquisitions. are capital things sense just get you today? trigger to are back move-outs private to where to work it work today looking into where guys want portfolio the the kind guys the Just to Is of portfolio you going larger Or more pricing guys sort are market? opportunity? you some within of perspective hasn't gotten overall capital through

Albert Behler

portfolio work on parallel parallel. leasing work funds. things do our our We we and We with

the be not have sheet. amounts all opportunities PGRE's time. significant will back equity at that our over look we going business, funds Maybe our over and we investing we in to own balance currently So said capital, even from

very Our sheet us. and important balance to cash is

that have filled and in is with ventures. potentially joint we balance sheet We a debt-free would liquidity. do And it

relationships working have certain horizons XX relationships been And have over of those in have investment years. since, kind do we We that we on different that have. cases,

investments really by very, M&M Broadway. on We together was wanted made a very nice retail our this the pension large amount a outpacing an some a very We eyebrows we this equity store that asset But small the bought very, Paramount focus a they We with and We investment, that bought on return have while a core to fund equity put some ago. income, made raised investment. shareholders. fee not investment. into on

looking quality. we platform comes that deep opportunities for are to can we market. And where focusing our investing use value of these kind the the expertise of So more on and we're also in

not We interested people some because in a it's C cheap think affordable. class and are B as just other or opportunity that

well sure partners. and at human justify would our investment. sources to limited, is side by and that want the a And we can joint venture Paramount We that really shareholders do something are our make looking on we

Dylan Burzinski

sense or office your And looking partners to money for in put partners, today? IRR they're your work potential JV JV mean future a have they to unlevered if do I you discussions what in with achieve targets

Albert Behler

their XX%, sources capital on something XX% and where from. at they're of coming what neighborhood depending looking they're in the Yes, to

Operator

Instructions] Stanley. the of Ronald line [Operator comes with Kamdem question from Morgan next Our

Tamim Sarwary

Ron. This Tamim for is

your Just you at XX.X% occupancy XX.X% side, on the the I occupancy, in quarter. guys take if finished

a about the imply that guess Chance. whether talked just and Maybe absorption it's little kind some pretty the guys Francisco that bit see Chance does occupancy talk New you'd or portfolio where at about You I of incremental Clifford in coming vacating. absorption from, substantial guidance Clifford San in York?

Peter Brindley

Sure.

is achieve approximately this So the guidance, our which XXX,XXX order during speaking. occupancy We're Peter leasing square in year feet the XX.X%. of is increasing midpoint anticipating of to

to think, we areas more achieve expect occupancy York. toward be with I the New So weighted leasing, will that heavily which increasing

Americas the an be West where Street known to of opportunity the we active. Specifically, there XX it Avenue at XXXX Clifford XXnd certainly will of Certainly, happen with be Chance. is vacate

has in Third high Avenue, one has has very underperformed. the of a East been side, the availability It's rate. that been of Midtown quiet, submarkets course,

occupancy say be result, them. needs locations below XXX Third certain an there's building proximity Third along yet, it is an with occupancy. recent as it have one seen transportation, Avenue Not just interest there, but we public in to But recently, where increase a would being where a where close a I to has historically with buildings And level of renewed uptick, to have been. opportunity well

good very goal have us. chip guidance. I think, specifically exact occupancy opportunity are, square-foot our about in where, those we we that feel number, have again, our opportunities along So we Avenue away XXX,XXX, to once certainly, activity the some to properties an that for that's Sixth But at get to

Tamim Sarwary

I the look then New And mark-to-market quarter, at San sense. if Makes in in your York, negative Francisco. flat in

Just for the where trending pipeline mark-to-market you the do see for guys the remainder have, that the of year? you

Peter Brindley

floors on is of about the XX% Of interesting. availability in Midtown, that XX% below. XX and availability It's

pushing floors, to power is floors. the on of rent. availability, been Class of you I upper So would of have are to amount terms upper we the would have we say just of say, and transact, course, on very in but just we we power experiencing nearly don't the our pricing in able buildings and that given have and, some that what base A positive we floors, on submarkets developments trophy some do I pricing

positive on mark-to-market it's be So too without achieve a specific, as basis. opportunities, mark-to-market, there to really it relates to will believe, being but we case-by-case

Operator

turn are Albert any Behler there questions closing to no this the at would further back over comments. to for floor like I And time.

Albert Behler

look quarter update our Thank today our We report we providing guys on call. continued to progress you for us an when forward here you, second XXXX joining this Goodbye. on everyone, results.

Operator

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Paramount (PGRE) 2 May 242024 Q1 Earnings call transcript