PGRE - Earnings call transcript Q4 2024

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Operator

Good day, ladies and gentlemen. Thank you for standing by. Welcome to the Paramount Group Fourth Quarter 2024 Earnings Conference Call. [Operator Instructions] Please note that this conference call is being recorded today, February 28, 2025. I will now turn the call over to Tom Hennessy, Vice President of Business Development and Investor Relations.

Thomas Hennessy

good and operator, you, morning, everyone. Thank

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

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

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

measure we and our available discuss should quarter During be with not prepared will measures in GAAP reconciliation as our the A these in in evaluating call, be These useful a we measures, considered our isolation believe company's performance. for in or can the to operating our release substitute which supplemental results the information. directly XXXX comparable GAAP. earnings measures fourth most financial of accordance is non-GAAP

to remarks, Officer, will Paes, Brindley, Operating Behler, provide Head open Albert Peter opening and Officer Hosting President, Real Chief of Financial Treasurer; Mr. company; call today, then Chairman, Management Chief of Executive the Wilbur have we will Vice the we call and President Officer some questions. Executive the Estate. and Chief and

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

Albert Behler

our Yesterday, our our the joining which for end reporting morning, total guidance is share, most our quarter for bringing at the $X.XX of call you results, Good per to year recent per we share range. Thank $X.XX released today. core FFO high fourth everyone. of

share year and between guidance and our $X.XX the with share, core feet. the range review FFO fourth square square square $X.XX guidance guidance it X% we million quarter, per target the with initiated have per year original along This trails greater XXX,XXX and between and XXX,XXX X a results our though in leased. guidance feet ahead full we detail. approximately In ahead, Looking XXXX financial midpoint Wilbur range is to of volume revised leasing XXXX of feet, year. total bringing for XXX,XXX last leased our from November. near the our

feet the In New square in York, fourth XX,XXX quarter. we approximately leased

leasing we shortly. in meet York quarterly New this ourselves robust. revised Peter remains cover more not in did the for will targets in detail our the While have November, set pipeline

array our We reaffirms of space on located theme New the in This core are strong conviction remains in submarkets. begin tenants particularly locations. legal in in a buildings of focused to increasingly our interest seeing and premier demand core new services strategically consistent a as high-quality, sectors. from financial with appeal York's long-term the the wide talent The year quality flight we

differentiator XXX,XXX Sixth community a continues San total our tenants, the patients new leased. the The in portfolio full feet In XX,XXX political market. potentially square indication along are New Paramount in view, where approximately to election particularly of November satisfaction square feet trend, this encouraging be Avenue, quarter, Francisco, Club electorate. our a leased signaled and reduced beginning shift from results a but this from benefiting is of market vibrant fostering continues just signs. retention. we our enhances attracting In while see lag approximately we York, clear a bringing year in in has portfolio amenity to significant not transformative Our workplace to and tenant the proven This the that the

activity XXXX was last San XX% year. Our Francisco compared over higher leasing to in

market Francisco also innovation on quality We leasing a venture as hub to The majority and funding for for are San Francisco's The of its in activity tech recovery. in flight evident improve. focused in potential as our to the renewals AI-focused remains is continues underscore and position seeing definitely its San progress shorter terms. leadership capital

confident well our We are these suited portfolio to on capitalize is trends.

of proceeds. valued Third to million Moving or activities. property our closed $XXX Subsequent Avenue, at the in million XXX EUR XX% square raising allocation the net sale we to approximately capital interest The end the transaction the a of $XX XXX per foot. year, in

estate and assets interest, in value difference lease manage continue continue market, the we underlying capital currently the the strengthens and XX% value flexibility transaction our levels The will further transaction to own We sheet, our offering the between compared balance trades. real This stock highlighting enhanced our our allocation which of public the at property. to long-term strategy. underscores underappreciated to remaining in our of the also

assets XXX restricted $XXX approximately restricted noncore the impact would bring Avenue. before with the cash year Third Avenue of excluding sale Third cash cash XXX and in million We of XXX,XXX. XX,XXX our adjusting for cash, sale and of the partial ended to Further the and

experienced market we sale real with our transaction of XXX resurgence. As broader continues to The signs exhibit Third. of estate

more disciplined also landscape, deals, seller more the opportunities. our unlocking to uptick between capital gap expectations a in to an this year. remain in continues approach could we We persistent potentially to market narrow, coming are allocation. committed potential active which The In and buyer seeing signal evolving

attractive position strong partnerships act market on enables we our particularly where those to financial Our can leverage strategic swiftly involving us opportunities, expertise.

performers the participants and aggressive sector Office America XXXX in status places the sustainable X-star that in top leader highlight earning global which category. Lastly, our environmental This recognition, us Out operations. stewardship among sixth the I'm to particularly proud rating for unwavering achieved over X,XXX commitment and to year consecutive of Paramount demonstrates

These hand and treatments our an engagement. A outperformed sustainability position stakeholder about with leadership underscore our resonates score Peter. This focus that, landlords. by the rating over XX%, to It's average prioritize transparency current disclosure, in them. partnerships grape setting responsible for increasingly reflecting achieved practices that on Our environmentally tenants ESG and meeting I'll the with we our investors who and isn't With just to dedication public about standards.

Peter Brindley

Thank you, good morning. Albert, and

last quarter, Francisco. the in end, occupancy leased fourth and the weighted approximately was balance for New average our premier, quarter tenants relationships, term tenant leased at cultivating centrally fourth spaces. filling with XX.X% focused quarter. vacant and The XX.X share remain San basis up York occurring points our and square leases buildings. XXX,XXX to portfolio-wide during New lease amenity-rich strong expirations Francisco, and from on XX% prioritize feet quarter both rate continue We York years. we was San in At In XX upcoming securing During the our renewals same-store for signed located

our lease and approximately XX% or scheduled roll leasing vacant to activity XXXX occurred year, activity space For served on in in XXXX. roll to leasing space our the full beyond. of derisk The of balance

by New we quarter of our at York, soon-to-be momentum Third core we amenity Paramount a improving in Plus have Avenue, square lease are helped very interest vacant at completed XXX,XXX where level new generate vacant addressing significant submarkets, the XXX our ahead, end, in and Looking combined portfolio. Subsequent both feet the market portfolio for Midtown's with floors. particularly significant encouraged to current in dynamics in our market-leading offering

to of out, and space pipeline are in scheduled which leases approximately for the half Our vacant for of to XXXX continues square XXX,XXX space and grow balance feet expire with approximately XXXX.

in are square of negotiations for advanced feet more we XXX,XXX stage Additionally, proposals. than

X-year average the since to leasing fourth quarterly QX activity exceeding XXXX, Turning Midtown's highest by quarterly New the market. total York quarter marked the XX%.

longer-term XX%. For quarterly continues quarter, the XXXX activity total Midtown's activity in willingness in highest XX increased X.X XXXX Business lease resulted positive to improve, activity million the fourth full during nearly by square absorption years. leasing exceeded full year, Midtown This tenants' commitments. in year industry, leasing irrespective feet resulting in of the to sentiment of leasing for make

more active profile. development In and conversion feet, tenants in office are availability tenant XXXX coupled for more in buildings. demand, little Increased demand select than leading fact, to is the XXX scarcity in Manhattan million a square buildings than high-quality market new of no Manhattan's XXXX, currently to premier XX with Midtown's of exceeding there

current our deal the in support by expect gaining momentum economics as and are We portfolio our market leasing increased improved ahead. will year in and New dynamics the evidenced improving York pipeline

York New quarter. from leased XX% currently is portfolio a Our on last share, unchanged same-store at basis

New in profile exploration approximately X% share during remains lease manageable of expiring York Our with XXXX.

increasing leasing companies rate continues Shifting as to Francisco. returning an tech to to the be activity employees been have steadily office-centric. to Francisco more workplace San at more office policy San their modify Market-wide sale improve

X than seen in past for and square year, funding AI-based the raise have large Francisco continue will billion the this tenants in as venture market San XXXX companies United work have the we raised of XX significant percentage become San scale a return in $XX.X beyond. roughly on an XX% to York, activity increased accounted Francisco-based capital States. increasingly in companies of they throughout feet funding venture leasing or the totaling drive leases larger more and New As XXXX in million capital to

With where companies Francisco is these more innovation than States and many far hub X,XXX AI-based of business. start-ups, away San will the their and leading-edge and grow operate United in the largest

number led market continues an be leasing While to tour of activity, conditions in there steady supply, challenging remain and inquiries overall and increasingly given have transactions. a uptick increased elevated to which proposals

was One backfill commensurate million pre-pandemic and notably XXXX. our In the full with leasing expire Street San X.X Front fourth space approximately since year. feet, Market soon-to-be the of total fact, Plaza JPMorgan remain activity portion quarterly year at the in One square at this quarter leasing of resulting focused space the on strongest Google Francisco's move-outs, of average that We

Market exceptional from Front We Paramount One both Club. our amenities experience to Plaza at plans currently developing One are and Street leveraging deliver

year-end, from basis forward you our plan San portfolio confident on was existing leased will with that calls. updating XX.X% a last are prospective our We and quarter. at on future look XX tenants Francisco to plan amenity tenants resonate same-store share, basis our points At alike up and on

in Market which discuss XX% will financial will is with and Wilbur, over at Plaza the XX% that is Front Our at in who lease San summary, comprised the exploration call share significant Francisco to results. at One With approximately turn JPMorgan Street. One profile Google I XXXX, of expiring of

Wilbur Paes

fourth consensus bringing NOI than quarter, share. basically Peter, morning, ahead X.X%, flat NOI to Same-store FFO quarter X.X%, negative you, was the better of Yesterday, everyone. Thank to bringing which which core $X.XX operating in cash was for at FFO in XXXX expectations continue in year our growth cash as of we negative full year full rein came same-store share the expenses. we fourth to our $X.XX estimates, growth $X.XX good full core per reported per and

the during impairment quarter, on FFO $XX.X fourth that estate recorded real do While have real venture loss. losses Street to effect an noncash want an not million estate do the XXXnd impairment I highlight joint

Our XX.X% $XX.X loss impairment share million. of was this

basis as However, limited only $XX.X in the to we venture were joint million it to investment the our of X. recognizing brought

During a foot and leases, aggregating of square weighted rents XXX,XXX term the XX leases a XX.X square with executed XXX,XXX for fourth total quarter, average We we of average ended square starting XX years. at per feet $XX.XX of executed for weighted lease XXXX feet.

square the Having Avenue came execution us move unfortunately nicely or with our same-store recent fell came the mark leasing which leasing lease occupancy sets quarter, lease goal of While can at said a that missed and recent goals. at guidance, activity into foot through through that, happen XXX XXX,XXX significant Third first the in way to we line, XXXX. which was up our This our in results primarily on team due the most we financial a as in most our at of the ahead sometimes. big

on of Albert the in which million sale cash year-end the reflected first $XXX.X in cash was we valuation net quarter. in a and balance As end gross the indicated us remaining earlier, balances will million XX% approximately a million, $X.X be $XXX of sold and of the our restricted yielded million. of proceeds reflected Avenue at $XX interest Third at sheet January, asset XXX The

assets the to know, the of permit facility XXX our order unsecured million. supporting borrowing assets our In improved facility the you one while of Third the reduce to credit facility. to credit was and As asset, we most supporting $XXX of of our certain limiting number modified capacity the covenants sale

let Now turn guidance. to me XXXX our

Google XXXX, lease noncash straight-line NOI, a lower represents XXXX comprised XXX been $X.XX following: is yields in XX% in $X.XX the a JPMorgan quite in the to decrease of be the in partially in due a in at XXXX to of share budget Avenue revenue, $X.XX which a and that primarily other has in from expense, general decrease telegraphed decrease $X.XX and midpoint. interest termination in $X.XX scheduled and reported time. typically or XXXX. disposition a FFO which from decrease This increase do January $X.XX a $X.XX and per in of earned decrease expenses. expect fees $X.XX in we by core per fee per in rent some lease in not our between for income San share nonrecurring administrative the core expirations, portfolio, $X.XX share a certain cash We offset and for, $X.XX a and debt decrease income interest $X.XX FFO $X.XX decrease and Third decrease The the including resulting a $X.XX from Francisco

a range between year-end on a goal occupancy XX% and XX.X%. to by XXXX expirations XXXX. expirations and given a to basis, feet. and improve the XXXX negative and flat and driven our And lease GAAP remain guiding significant lease we leasing and on XX% same-store portfolio-wide basis, expect we to the expect and velocity X and leasing X% between same-store occupancy to remain in million negative We growth negative are XXX,XXX leased Notwithstanding negative XXXX in our significant rate square X% year-end expect cash and to between negative that XX.X% in goal, same-store roughly is in

open the San deteriorate occupancy specific X in While Google will say XXXX, York Francisco, regarding we occupancy York Page in XXXX San give guidance. the XXXX include for package supplemental please driven that, JPMorgan in With of to refer investor our our continue lease questions. for by not with that improve our the sheer magnitude further New line New additional assumptions deck metrics do respect in of operator, Francisco and while will will I and guidance and to and our expirations. Please the to information

Operator

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

Unknown Analyst

you on This sign about Manus the quick if that color Maybe little helpful. weren't were able is question for Could mentioning talk if the hesitant happened? was rates? was couldn't you I would that a through why for understand fell be the to that a finish maybe deals that reasons you had bit at on based, tenant of to just agree or line. it Steve. to rental the like one on you location a here Just if us specifically

Peter Brindley

it Peter. is lease This known. ultimate is Sure. is reason at The entirely be and not to It a pulled. be for highly unusual execution to for

very was that so And really unfortunate.

I think probably interested plan and very in floors that of going talk quite tenants our right a productive, we now. have seriously are couple X it's forward, more to about honestly, these

so mulling didn't will And think this the other that ultimately while other is decision, tenant do. transact what ultimately I they

floors in proceed with creditworthy think those X future. I likely we will for the really tenant very not-too-distant

fact, In close. think we getting we're

occurring, but those that all it a XXXX in squarely we this unfortunate, along where referring, you're the and Avenues the was on are think middle Sixth X of of top XXXX in of the is Club, Ultimately, base which of good floors and the activity New of have finest arguably Paramount club story directly we'll familiar sits So with, York, at at course, in Avenue I'm Americas. it

Albert Behler

rent that unusual And the was very, here and it's thing mean, only I deal, Peter good the And goes significantly I this The unfortunate, Peter for very a Peter beginning something can and in are higher here that's that is at that in New and we leases are to very, finally, York. saying, portfolio feel I that about happens. this the little XXXX we now across going good really a momentum see push that the as team current [indiscernible] that rent. of bit like are think team. talking in

Unknown Analyst

stand Center noncore of it. so for appreciate Got the And of of would beginning as the question, of I makes if Market progress may. terms stand thoughts on assets, current resolution lender maybe the or that X we X I XXX you a in the XX, sense. touch like sale Street follow-up Could the in helpful. That or just maybe be color. potential the now Sutter kind or

Wilbur Paes

to I much think don't about there's XXX Myles. Sure, frankly. Sutter talk And yet,

an through that December there If got we end of you runs recall, of extension the XXXX.

funding the going on funding not to shortfalls. to We're highlighted we're the with to So sheet risk to the resume we've Sutter with no TIs that conversations because lender we're But front. not as lease before, debt that we Paramount's have you there's balance respect disclosure. in sure has optionality That press I'm and market. awarded. the That is seen saw asset. deal Center, the been that guys the continue to we property asset reports, have you Market manage all on a XXX and

work the to lender sell continue ongoing. with that to that remains property. And We

as a We The early at recognize off debt as we which perhaps tax books the can come quarter, point resolution the loss we'll play off expect second books. our will that assets with. a and around will come our

Operator

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

Blaine Heck

target XXXX in seems relative midpoint York little of $XXX,XXX you feet that at strong leasing market leasing ambitious New the The some the argue pretty maybe the would XXX,XXX a 'XX. did in to square what

under about gives I that, that there's around 'XX. talk think related Peter advanced So feet stage confidence negotiations. in And can said you contract you square XXX,XXX to or acceleration of in leases in just what

to of it? leave think So leasing kind the to Is $XXX,XXX target. to the way of that about get that speculative would right

Albert Behler

of were being quite And seems there market question moving guidance there let the Avenue significant -- as more lot answering on moving tenants and high-quality it regard going done. space, towards already be to with that and is happened the that's the that the mishap A with are to fourth in was on much with to properties, quarter the we Blaine, And back the that's was to is really asset to the The seems don't were lack leasing maybe And is can pretty leasing outside And area, Park of on and marketed Avenue of and be the left have ready the especially saying, XXXX. Sixth to to transaction, a leasing. me side. fragmented that who Scott, footage. And Peter an and we it there's be other XXXX market a regard assets was asset our really submarket. counting West that one we square that signed. that happened sidelines, confident be why achieved. basically in very

So very achieve confident guidance. are we this we that

Blaine Heck

Yes, go ahead, Peter.

Peter Brindley

And just to to just add March. here. It's about we're that, sitting

in leases New But we at seeing that but market, at forward We what just then it, a more. York. our here or in it, -- what mentioned we're have, by of in course, proposals mentioned, positioned, $XXX,XXX midpoint. a terms sit of I for about March, put age various way and of $XXX,XXX in as out as which call achieve are just will proposals way on nonetheless leases advanced XXX,XXX, we feel terms that is in exchanged. very we the the the confident out call there's we And I stages, of offerings being X/X bit velocity of quite of And

Wilbur Paes

in had one you terms speculative, question just to clarify of that. dimensioning that Blaine,

pipeline already is excluding right? first Peter the square XXX,XXX about that in So square the place already is lease foot lease XXX,XXX was speculative Your took not the executed that quarter. when that talking in done, math XX does the foot include a

that lease. your get a reduced of would at foot MAP speculative minimum So by square XXX,XXX

Blaine Heck

leases the you any about you're Peter, generally, level CapEx seeing you, highest record whether risk as And quarter. fourth of respect percentage Can to initial leasing of concessions kind drove talk a we the have rent just the market? sticking increase? more specific then, on that in were new leases And for that there with at maybe with what on

Peter Brindley

that think, positioned owners, rent, lower was we'll turnkey What other words, generally initial it into really floor year in on of Sure. deal little Paramount bit wouldn't higher than speaking, in for that is, we've a a a what our I that buildings. Sure, turnkey that as space, see where what a have ahead was historically. percentage drove tenant for certainly premier of well X a But build a was that Blaine. trend. as we type I expect to chose assets. in And it I been the read --

floors, year and power of will We higher in have pricing below. XX particularly midtime is XX% floors ahead, the on availability for

it's as floor, So interestingly, Concessions And scarce. when we power. we result, are you a I pricing know have have becoming elevated. an upper increasingly think

They time, pay their some that do is given little the to bit picked a stabilized are Midtown I being rent. certainly and tenants is not have earlier, over out think objective in real market double

it that for that point, inflation will reason. rent in had to being is. allow improve impact probably So X may achieve free reason, feel the X years, for is a little remain it And better recognize rents the some will we start market our very said, come remain this do the quickly at effective come in on It that has us tighten. we space. to, in in net I that improving. about I the that think think fundamentals very think where near likely will really product Midtown bit start but that to down moving where I And continues is said, last I term just TIs over to year mix as cost to specifically, the market think like ahead. good But to I an

Wilbur Paes

what add comment to to in very your just as high. that mean being screened I it's Blaine, Peter said.

fourth the the from you fact leasing that had had of or the feet square so recognize activity turnkey that quarter. only Aside you in XXX,XXX

you high. have you so so activity, and -- limited low and it that screened on a have you floors So have turnkey, number

quarter-over-quarter, year, more on have line feet full our line are was in more what square been at been reporting the those leased look numbers with you based in peers reporting. that XXX,XXX If with have what the we

that very fluctuate, can important quarterly was on so activity. but it's limited highlight metrics it to And

Blaine Heck

we're starting if updated the That's fair. know still to transparency one move-outs. I XX wanted XX in largest negotiation. likely you And thoughts just and and move-outs on color which appreciate I I your give it. more, which can. the ask could expirations on and in Got on XXXX, commentary if are are I your in any absolutely But

Peter Brindley

I number say of and a in the the that are expirations York, at out, you Blaine, think look move would out 'XX under the Certainly, in So Showtime largest currently I specifically, negotiation known move But largest likely represents if discussion. New in XXXX.

And XXXX so that expressed expirations to you occur at dwindle. tell Showtime. of high-quality will we XX% several will our I that of the largely of interest have block in by blocks have Midtown this XXXX, continues driven space, tenants number in

we XXXX. you Morgan KPMG. point, Autodesk, And that at And you this San think our Visa likely largest, and of I so in say, active the Lewis, in sort move about block are that's have the Francisco, of if space. But would in parts portfolio moving out on largest

is move-out move-out. Visa known and think I a a is KPMG known

soon are think, I on. to X, comment other The too

Operator

next Our question comes of Stanley. Ron the line Morgan Kamden with from

Ronald Kamdem

Just X ones. quick

be for helpful. overall what talking remind of plan what's you REITs property Just the how just of on specifically large the Just is today? on we've could I'm then redev? Francisco, if a turnaround just just backfill us there tenant, And heard tenants, would commentary small some the expirations, and And plan of the the attack on different feeling the just there. sort San types you're curious, different coming about market

Albert Behler

Great.

seems think leadership fact for the are new active Washington asking change question setting tenants Francisco be and market. new significantly on goals. that because brought X the thanks there. leadership the that, Let quite some XXXX in to San I the better might and in we me the first despite [indiscernible] impact clarity we to in leasing And Francisco in start be very that have 'XX than of I the did getting new in that San is active think The have months might more already the

as and are our we locations already details quality first quality. increased, space. I'm of are good the leasing into in go in assets months, even what Peter So know, demands and good And talking X showing of about, can you

the with the The the picking But least this So we example, office Chairman of go behind have be said of ever move the -- we last diversified as at office. lagging had had economy York. now New York to be companies large over seems that to Francisco X it a being nobody is million the earnings the seems initially and economy. in always not San office, had, as tech New also calls calling pandemic to to the who now for people to in back Salesforce days X that is up said back for after X

people's of So kind samples change those are important Peter? to attitude.

Peter Brindley

can leasing is of are companies all been tell the fuel generally the start significant. significant their to a to all velocity. more happening actually early-stage we number has of companies that's Venture way. year. number a in importance the supply-demand then order what's broker here. of now assessing office inquiries, calls what the outlined, you happening are with we're lofty drives quite We've these to well Francisco-based activity return much up. that funding We the just plans. on San out in execute San adding all active is I capital And familiar Albert office know a think the to field acknowledging problem in And to Francisco. feels in more Tour had real-time I And

of that CBD in will be North We'll positioned all they're this. think, the well District. be, And and the South Financial likely to We're continue to and market. in so the out recover I the first submarkets

where majority is the leasing occurring. the of This is velocity

percolating. this now just all is of And so

of plan, move a and have with We asked known about out, Google JPMorgan. backfill as course, to the you

one to We another the for between now amount that actually move tenants. talk on of I It's plan. the a skill activity. It's our needle have also amenities the thing and have several to good to we amenities. execute out tour through working do buildings, our have, X We're about leases amenity to think,

leveraging into what in we're San putting And our that of the and and have Club way Francisco what some we so Paramount Francisco. able San at the deliver to do at learned in quite bit work we're properties a

of demand, did way We I to come just tenants out market But increase. all profile Ron, all where had would ultimately better additional drive would we've to the we So while to but we're at help be last field, think, need XXXX. we did start of year. are the best off feeling time I this like we to to year just not And see velocity. continues generally in the that, more say, the the will we year, demand, since by considerably in than just year the start

Ronald Kamdem

That's second I helpful. think saw sell then X center the the with is, the I there market working property. lenders the XXX to Great. And is plan loan, my so

my early, sort I the it's think plans I So are -- refinance? any and guess maturities, about I where of XXXX but the you could for indications what think those if know you on

Wilbur Paes

CMBS lot New Sure. Look, XXXX I talk. as maturities tremendously. a market up and they to market issuance high-quality on insurance continue A little think York. continues to the for improve, The sidelines in sit the sponsors. loan especially work picked New XXXX companies assets, are the of their maturity overall through high-quality books. to improving in But too is York The bit banks has soon

fact, that in X.Xx was activity In XXXX, XXXX. CMBS of

So the spreads to -- in. continue continues improve. come to market

and move of XXXX. half that tackle we into we're So going as second into the to XXXX

Operator

line from the Catherwood comes BTIG. Our of next with question

William Catherwood

in to yet the midpoint roughly leasing be make XXX,XXX am back hit leasing get I the feet square of square to right? the getting identified numbers it of to thus want right. XQ your the active I leaves roughly far Wilbert, answer sure sorry, XXX,XXX feet question in -- between and opportunities guidance. leasing Blaine's of Is XXX,XXX feet to I go that square to pipeline, to

Wilbur Paes

-- other right? me necessarily That first the let in that done clarify quarter Not first So on. does just executed was significant -- quarter, that represents The square XXX,XXX one. been add is not deal activity leasing activity. foot one the represent has just there

he look, square and XXX,XXX So mentioned pipeline, it's said, when the it's Peter growing. feet,

come leases does and you'd you XXX,XXX quarter far again, to feet the up factor not other growing. if plus/minus So just that executed speculative But when XXX, activity. have were take that first to include pipeline been about that, you the in right now, square the of thus

William Catherwood

Okay.

the at percentage a square maybe target is that it XXX,XXX higher. the normal have I would way. seems that beginning wrong a this very year. high already the Is thinking But your kind roughly of try seem leasing give It me that identified much once Or identified, let then So of am midpoint, for like different guidance? feet X way? the you to about of even that

Wilbur Paes

look look you to depends. the it the portfolio. That think pipeline, given We a the at We are actually a When he the pipeline year. market. at look in converted We role any at either. assuming is at lease. pipeline. fundamentals quotes Look, I the not we is look entire in correct

about square we leased our XXX,XXX So slightly to leased The seeing the that you midpoint and comfort at we fundamentals goals, to in the what them continue typically as established feeling the have these the and guys a to reaching around we does and goal we be there goals to XXXX, year. we hopper under stretch determine market the was tweak to go and the XXXX goals establish it feet. you square we XXXX, and years. triangulate of goals, the the in if when then have we improve sat and table The in continue come of guidance when close million onset, try we goals, forward. be beginning happen. through to between and goals in those these as is do feet we'll sit what give as not And good XXXX pipeline we're and X But robust. very see But the the to to to went as more

William Catherwood

same-store redevelopments much Okay. that or new pool CapEx of be cash allocated investments pulled Then through of at mentioned how they example, on that the for arise? -- over $XXX front, many should of over $XXX out that of how million sale towards I one and then thinking in How which of partial maybe, the is -- interest for you XX much earmarked spending, kind could Albert, million you with of the maybe X. pivoting think closing cash the

Albert Behler

consider always question. that We the have. good it's Yes, all we a options

front required assets. to at So nothing what's X is exactly too it's really earmarked other identify specifically. or And early

the certain I a keep think other to call, I firepower. mentioned on have of we amount

might our buybacks. I also asset-light. stay will the we're liquid, correction said in the at perfect a have to share quite small only There been And we a with the equity, of of keep you who find our we opportunities. That and back less time it's have who will people we you looking consider will as get past, If is bankruptcy, to time being, But line amount partners for market. think will we invest us. means active the go and an open. into and want or overdone, more options co-invest We only has

I for at the we we So execution of sold opportunities we and of about that. all market. currently NAV piece by north great are the and a great very what busy on for shareholders team team acquisition is think very at have, a considered the are looking And -- focused is XX% the to the get it was

this shows public think pricing markets be point. not I So that the in that might correct at the

Operator

comes Our next of Mahotra iuvo. Vikram question line with the from

Vikram Malhotra

to know this, late, out, if to pipeline. I on or specifically. the Google options those not are but of and I'm Sorry if the X the et pipeline move you any want JPMorgan. gave backfill specifically sense what joined I but they'll just how need like sure just cetera, you

Peter Brindley

Yes. Vikram, this is Peter.

we been activity to buildings, those San way than see X And steady. out tour I being did Francisco X between you got to in X that front, always want has more the several of starting market. by So more are see demand demand earlier while leases we've mention

We all by received and are tenants. also, been important prospective becoming well that of and I San very process amenities, so out that Francisco both in the think, to tenants to properties, we're earlier, of are in has rolling which I mentioned delivering increasingly

this out. so And how the activity picking year. feeling as I a this beginning year leases mentioned, of Tour we been at time is up. quite do felt better relative have It's last part since bit we to several

times we'll more we've on seems Francisco direction to to quarters, moving San but coming several be as report so right have from the in this And call. said the now

on recently to in the about what tour forward increase of converting we proposals, of of look and course. exchange executing and some have front most that both We have with us in of the activity come new opportunities the

we that's current. so where And are

Vikram Malhotra

you trading strategic the Is years just a part JV-ed about of JVs And and bigger thought thought a action, additional peers. of absolute or or picture, just more there kind part a XXXX, of is or then given where in one. to stock several asset just I perhaps small relative ago, is a, last there guess, interest even sales

Albert Behler

or and grow make said As buybacks had had making the we of with equity that opportunities a XXXX, and create ventures. as And to sure the if that value, said, we pricing, you flexibility share was would a partner decent potentially an think and is pandemic, we that in dividends we other we the then well. use find can as joint done in consider have potentially of and asset, we past, piece other and who buy is early find right that and/or willing definitely as with we

Operator

the next with Dylan Street. from comes of Our Instructions] [Operator Burzinski question Green line

Dylan Burzinski

they're New can team about clearing. is spread today? Francisco? guys transactions San Francisco as a mean, you I across the the guess a footprint is get to across sort much wider ever, where take of than sense York, mean, narrower you you and Or spread San back to look to New really still that necessary to that start point that just is sort being as as I getting going talk I market busy do acquisition buy-sell guys the York your it of bid-ask in just but being comments on

Albert Behler

I very markets really think depends. both And different. are it

the market getting an debt weren't case. in think, and be take in taking the in capitulation team to some cases. really while. to over some it's are recapitalization narrower for of on is there considered market the Sometimes a don't different owner are for And over. getting or that assets It's And I each that the wanting put spread,

So in development Francisco, San looking those is we investing back it's I in in think Midtown, in least of kind it's markets to more are a San you the be as at in because at look that's but coming least -- XX achieve. at you really can And have value And in Midtown deep months in shown mainly behind that Francisco can City. value, for that well. York. New the York than New But riskier you definitely of believer our

Dylan Burzinski

can about one a has in York to the the been are kind touching especially activity today. as But guys traditional tenant it you I just large tenant helpful. on starting talk tech sidelines there. of sort big San relates leasing That's of New recovery in and of activities, And of I see San more to guess Francisco, on know sort Francisco leasing. you sort broader, larger

Peter Brindley

Yes.

from more early-stage lot So we're a I activity of seeing think companies.

the in New But of experiencing in which we're past than with law tech seeing what law different of with XX% activity, type significantly of about tenants cases, smaller very funding, York we Some tenant many them rightsizing lot market not companies, in the we're square stage, was space. for firms of New they're comprised AI profile large looking actually, early they're York a feet. like XX,XXX, roughly octane the traditional and companies percentage a or is significant expanding. were They're over of some but the year, less and looking firms XX,XXX for high

average of might little a think Francisco. deal in your half this year the I so be size in bit smaller first And San

And are some know in think, as starting all past seen the return for that going to time I the year. starting have is, have again. companies But years, we largely for from to who we early of office, several with that inquire been the the this something tech larger hear certainly, to dormant we first

but they're it's they firms, financial the not yet, service inquiries think technology had feeling law very of of with the increasingly number I number good tours companies the about we only not out entirely with just are that that in we've are reengaging. but are firms, -- that So field, we've had clear

how I so very us see will develops interesting San And think a be Francisco. for year it this really in to

Operator

Thank you.

Albert end remarks. for the Behler I reached turn to closing question-and-answer the to would back have the floor of like We session.

Albert Behler

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

Operator

concludes This you. Thank today's conference.

You may Thank disconnect your time. your at participation. this you for lines

Paramount (PGRE) 28 Feb 252024 Q4 Earnings call transcript