Healthpeak Properties (DOC) 2 Nov 222022 Q3 Earnings call transcript

Company Profile

Participants

Andrew Johns	SVP, IR
Scott Brinker	CEO, President & Director
Peter Scott	CFO
Scott Bohn	Chief Development Officer & Co-Head, Life Science
Thomas Klaritch	COO
Austin Wurschmidt	KeyBanc Capital Markets
Stephen Sakwa	Evercore ISI
Juan Sanabria	BMO Capital Markets
Steven Valiquette	Barclays Bank
Michael Griffin	Citi
Ronald Kamdem	Morgan Stanley
David Rodgers	Robert W. Baird & Co.
Michael Carroll	RBC Capital Markets
Vikram Malhotra	Mizuho Securities
Richard Anderson	SMBC
Omotayo Okusanya	Crédit Suisse
Nicholas Yulico	Scotiabank
John Pawlowski	Green Street Advisors
Joshua Dennerlein	Bank of America Merrill Lynch

Call transcript

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Operator

Good morning, and welcome to the Healthpeak Properties, Inc.

Third Quarter Conference Call. [Operator Instructions]. Please note this event is being recorded. I would now like to turn the conference over to Andrew Johns, Senior Vice President, Investor Relations. ahead. go Please

Andrew Johns

Third conference Healthpeak's Financial Conference Results Welcome will Quarter contain Today's call certain Call. to XXXX forward-looking statements.

non-GAAP the directly is furnished a reasonable statements from our financial be Although are with cause actual comparable GAAP and believe the expectations differ measures reconciled Scott any may Reg in we materially on on any X-K the to forward-looking the expectations. call yesterday, in G of available an risk at uncertainties SEC financial based that call I'll and on exhibit and President press statements. Brinker. have Officer, our risks measures we A In measures The do SEC. our our requirements. subject We detailed will assumptions, the are forward-looking Chief now update and all in the results most factors exhibit our to the release duty also healthpeak.com. not with of Certain Executive undertake over discussion forward-looking turn filings risks is website our with reflected accordance to non-GAAP statements included in discussed to to

Scott Brinker

Third Good Quarter Thanks, to Call. welcome morning, Andrew. and Earnings Healthpeak's

Q&A. Joining our Chief and for Scott will are Development team me Bohn, Officer. Pete for remarks Chief today available be our prepared Scott, Financial Officer; The senior

want his contributions the over success. X energy of faced be detail. will behalf the cannot I a Board guidance future We Tom we teammates were best. significant, we needed same-store. full past as company, want his Pete thank strong your earnings the also the to First, attention were very every significant quarter for of for to support. market details. have to solid. Financial thank company provide a challenges I bring opportunity and backdrop on position for to years unique in and to results The both for third the their opportunity and bit and this the picked my tough conditions increased better I year for

years estate with to to Let's company part at to underlying us that back experience and I and creation focus And team enjoy We'll XX believe and want say Healthpeak. rewarding talk a about an and growth. businesses team heart, that shareholders the the now, I related future value entrepreneurial intense that the me. journey. immersing a look collegial produce was on activities be I will real earnings our support for of and from an the mindset returns our are important I for be both strong portfolio. want

for key side-by-side decisions this past team several was the all strategy, and years. our the in As

changes. focus maximize and the don't These creation minimizing on to So risk. we aligned the expect while We'll major expertise and life modern with where businesses scale have economy. office, both are high-margin medical any are science value that

innovation, Relations Adam Development do sector Bohn There's and one important so continue acquired demand of for more expect year with to Our so. unique cost-effective real for communication also in no U.S. estate as Meanwhile, have will been Tom. science, established of more Klaritch We'll for to us. the per Pete excited as world I'm Scott convenient real having continue grow the decade function CIO. team, Bohn and Officer, Miller in The have as is There's and their together. billion that enjoy success value their inch record They our that taking been a Life and business. of our the Co-Heads CFO and the for our for a implemented. care been accelerating has in markets disciplined from Counsel in working Scott is Science. on and Scott $XXX drug square stepped excited Life over health succession plan strong public-private more will as spent talented MOB now demand buildings. decade continuity local than to to team developed for of asset X the and and than and a medical partnership leads need now know Jeff come the decades track cycle knowledgeable ages. the and and past the research approach will we especially a support virtuous continue will billion and of our see we as that on $XX drive running our years Mike running will Tom MOBs, sold, base. we long-term valued into have been our even biotech has highly our an transparent driver than is has local markets. dedicated the more transaction as in of support creativity the served a from Science Mabry of population to that a we human and Board's tenant at ever. do role will role bigger HCN. streamline and is estate. health, strong execution every continue him going the X member you've role critical is office to Investor Chief that than in forward portfolios the expect General a of capital be Dorris for to thoughtful having

remain ground. vital the This connected past continue Johnston. operational to real drives value, well Alonso expertise such estate process years has of best-in-class play The finance, years. our me. will existing business so and will me in niche tax and of as to the the Our We that seeing strategy. X which accounting, members a where worked to sectors part remain Shawn critical will leadership, with we're allowed report functions to segments what procedure on tightly past continue X out and executive includes built tenured support and like Lisa We've HR the team

plan to balance investment-grade own I market, team more carry into the We sheet trends of savings G&A turned liquidity. my and and in the competitive given prioritize spend understanding the strong to remain near-term fact, expect we'll and streamlined forward. that a have out even Pete that a We management opportunities. and assessing time do In advantage committed team.

XXXX estate peaked. Moving XX% accretive to through XX from or allocation. we were XX% not aggressive strategic our grew the development In in Life acquisitions NOI capital new Very and past purposefully, particular, values development before real today on we starts Science acquisitions well in highly to of months.

sheet commitments manageable. great result, a in the is funding As balance and shape, our are

equity time in assets at sell issue wrong cycle. to the need no or have dilutive to the We

to fact, on when advancing In is offense. we're markets start science across that end, the position X to To to in a markets. we're which best all of life be time reopen, the entitlements opportunistic our go capital

have can't next at in second commence But ready benefit development having though opportunities. to the source timing. the market medical and the from the life local control we will always half XXXX, science time. a scale of proceed expect any relationships to to wave have we decision deep and to Both conditions office on We of depend market, in

plan. is So need my a funding view flexible that we

and more preference At to operators including that XXX%, always time, is private pension isn't and own sovereigns funds, to but premier equity partner approach accretive consistent large assets available. capital same there Our with at flows, Healthpeak. like raise and looking the prices public are

So capital will and planning capital but always be benefiting the consider appropriate, with shareholders. dynamic in peak when third-party of our goal

from our to within going core X appreciate convenience also expect example bigger forward, on-campus our An being but bit the still medical we box certain That We off-campus benefited to said, play provided little is by concentration. in have buildings. where a segments. we office,

provided strong dogmatic to health system off-campus in and assets So be a affiliation. approach we'll less open-minded our

We local synergies between some also X additional of partners R&D our market. in see doing the system segments potential the their as are medical health for

to CCRC Turning portfolio. the

in You trade reduced strong of XX% our Brookdale and dramatically us CCRCs. strategic triple net full operating gave That portfolio XXXX, might partner concentration that we traded for their a senior when LCS. the in in the recall housing control interest we

life focused medical science office. priorities are allocation capital Our and on

carry for So attractive sets, one seniors. another the in with company assets CCRC learn creative best to skill to opportunistic that a In with supply both the fundamentals, for and and Pete create has balance growth I've CEOs it growth. demand position. forward To be sheet. cover an of the fortunate and wrap and up, and is Turn to we'll My external concentrated excellence. under interim, and favorable financial high-quality results unique for own to been internal goal about operational Florida, destination our best-in-class business we

Peter Scott

Thanks, Scott. results. with our Starting financial

segments was growth and continued of FFO In and third For the XX%. of Life occupancy with solid as a portfolio economic quarter backdrop, deliver X.X%, challenging an same-store reported our a adjusted growth operating $X.XX total excellent Despite very more the Sciences, X.X%. same-store of results. we rate per to share we finished quarter,

Our renewals a cash mark-to-market positive on XX%. was

tenant exceeded our strong Science collections and industry results bit. and rate rent Bohn on in expand remained fundamentals Our will XX%. Scott Life at XX% retention a

during far leasing fantastic had XX sequential XXX,XXX million points. to occupancy feet increase quarter feet leases, of have the a by We approximately Turning of square commenced we another This quarter of XX%, new with Also, medical X.X of strongest of quarter, year-to-date. square experienced We growth X.X%. finished was basis leases. of office. total same-store third we including with the

focus, on-campus our tenant rate XX%. high our remains given at expect, retention would you As very

combination growth be our contributed the same-store at did percent medical is campus can NOI a quarter, for X% percent Same-store quarter hospital lumpy the Our benefit out CCRCs. Dallas. rent. Medical rent segment to third results and with forecast. to of This City X.X%. trophy the Finishing exceeded The revenues contributes office very rent which third same-store the performance. strong challenging over from and at more and increased forecast, our it quarter base of a In

quarter a point amortization the and were care at NREF Our results is This of our IL, third IAM again units occupancy quarter XXX of COVID. for our and quarterly $XX by driven our memory $XX strongest increase gains million. rent AL were outpacing since receipts units. the in in once Cash occupancy million, basis

revenue are negatively line which legacy insurance. in impacted expense top settlement including pressures labor, September, While our challenge, have and this food encouraging, a trends insurance quarter. did results of $XXX,XXX remain onetime We

elevated under relative year, remains Last historical highs In addition, from results. to levels. earlier labor item while are financial this challenges the easing it experienced

declared damage. For and We share. of dividend importantly, most of at Thankfully, the third experience our any life Hurricane of staff of our our assets. loss no some or was on modest property injuries or the update to Board there A impact per residents $X.XX did a Ian. quarter, quick major

added of $X deductibles, adjusted back to Healthpeak to factoring the to CCRC on exposure the all We approximately at anticipate which impacted have lower been insurance properties in policy, our per the do be our impacted temporarily We maximum when and as occupancy expect quarter. FFO by hurricane. coverage sales and has this properties million NREF

I into cover guidance bit. this the factored will for our have We segment, revised in which a

Turning to balance sheet quarter our with EBITDA course our turned The a to advantage. to our markets more net Xx. couple third ended range have The clearly sheet. of balance a key good of statistics. volatile XXXX. to of the target over X.Xx is X.Xx, of the news below A capital continues be competitive We debt

ample no few have pipeline. complete bonds us development sheet reduces substantially risk. redevelopment active A our of with XXXX, provides to maturing liquidity, important assumptions. which billion And which balance have $X.X capital We until and markets we runway

million we ago, loans. days $XXX draw of First, drew down delayed the full X term

rate swapped initial As we a X.X% loans interest to through reminder, term a fixed maturities. these

net settling equity anticipate these blended equity of X reduce from of million forwards to floating debt rate transactions proceeds forwards be was The year-end. price remaining these $XXX we used per Second, gross balances. issuance The share. approximate substantially our the will at

Turning guidance. our now XXXX to

$X.XX, our tightened the by to as have the $X.XX to guidance to We are guidance range increasing FFO adjusted midpoint $X.XX. we $X.XX of and

the XXXX driving midpoint to and Additionally, We guidance basis transition. details our guidance of and in XX by by Life follows: to guidance. Page midpoint supplemental Scott the benefit the G&A FFO of guidance basis The points. related we midpoint the basis of our as midpoint components we XXX me in our range let guidance same-store same-store $X.XX medical turn call to tightened our see from XX the a additional office XXX of increasing major by of we to X.X%. our same-store guidance X.X% same-store increase management about points, Science With our refer are have our are to by basis savings increased reduced guidance points. blended increased points, our for the XX Please We the we that, over to Bohn. CCRC on

Scott Bohn

We the with start I'll feet a Pete. Point. foot of XX% Life foot included new the front a square square advantage Thanks, coming our form portfolio, leases quarter the of square over with Phase portfolio. XXX,XXX across great XXX,XXX XXX,XXX This on lease leasing renewals. versus executed with an in I on had Science lease Oyster update and at leases

ability Additionally, for competitive existing we following and and was It's growth subtenant Oyster less XX,XXX Pointe in Point executed an provide have was an which of one at tenant very expiration tenant, X that foot square size. building will important tripled note lease Amgen's we building. full lease fast-growing maturities Grand few growing our with highlight go from with year-end science Grand that The to Vantage Pointe the a them of end pathways redevelopment existing a year local square in The to existing lease lease XX,XXX XXXX. our life than direct These these space, The again scale the lease deals is benefit we ago. to at portfolio lease XXXX. with an in the advantage put through foot companies. of

great space especially and San LOIs San back and our lease of off In perspective. In a over start spaces. Francisco, a foot we Amgen Boston leases rollover well-positioned in lease they successful we've or rolling portfolios of Pointe a executed Boston, minimal we have XXX,XXX with our have South In and leases to at activity and the as other previously execution us Diego up expirations Grand are Our window. only in strong rollover lease in XXXX San Diego, within to are XX% the redevelopment XXXX. come been mentioned backfilling that from square

favorable have confident Francisco, ability we the demand are South in market While and supply perspective, do we from we leasing in view most a some to that to San execute. so as our do

X.X from within South space XX% In portfolio San recent million portfolio. year, of X our we alone, tenants done in new the Of Additionally, tenants. feet existing our XX% continue square of to we this has years, base. existing with done significant capture have leasing growth leased million Francisco been square development nearly has the of feet tenant with

Our resilient our with historical collections opportunity Life to in mark-to-market with over the and remains XX% net credit portfolio quite favorable the at continues for across be tenant Science line quarter, XX%, profile averages.

high by credit strengthened tenant XXX,XXX as at started Callan as a Francisco, for billion later Diego, This the foot lease which feet Point full was result lease Vantage San quarter, XXX,XXX further to billion. building, by for Pfizer and Bristol-Myers which for deals. a executed Development, acquired our Turning mid-'XX, take at credit large $X.X In was at in our the we square and Global completed $X.X Ridge Therapeutics, which a is square deliver to a set acquired Blood Squibb. square profile San foot of M&A was grew tenant some Therapeutics, XX,XXX In [indiscernible] South

we've San million with market Now low demand square rents active and active mid-single rental of to million San mid-single in rent X approximately feet. rents growth year-to-date are digits Diego are demand demand the up square active for up is feet. and X.X square South approximately In in rates looking with Market mid-single seen million digits X Boston digits of the feet year Francisco, up supply. new at demand.

capture record rates. so over with are pre-pandemic single-digit While when markets and the demand continue remained relationships due have tenant the and their the few low to incumbent outsized the are landlords entrants to come that other match. percentages leasing of years, highs numbers Even unable to scale Healthpeak off science life line comparing tightened, markets in more having when new they levels vacancy past to activity the and will the strong

have projects the projects increases interest on being supply infeasible. levered made and that development we're a hold of or the side, On rate seeing more conversion higher result many significant and ground-up put costs potentially delayed as economically impactful

tracks than clusters X today and lower within competitive our X-plus and over ongoing we was next supply is it team the proposed discussed, ago. project we're months every our years As tracking the

XXXX. Next, and offerings, environment. I'll debt tenants which life is partnerships enter seen as levels well year first match half R&D year through capital via earlier. already number last lending pace was to seen and during is a tenants of private spending billion, than R&D our full the mentioned funding $XX surpassed on VC pharma offerings science and the equity biopharma some touch third challenge as XXXX XXXX placements. as to license the or has We've the spending as of the into X% and We've half year ever. XXXX raised agreements is first full of on higher also secondary large highest Public transactions, M&A with pace year on I quarter year the

Now turning to development.

are an Our developments $X to pre-leased fully time million All stabilized, and NOI are GMP, new in of out City with effectively incremental certain X.X%. of $XX passed the budget bought science XX% the on densities billion in and approximately locking blended active projects. our plan Once life continue cash of yield higher yields. ability land. expect to The plan a including these parts we on the developments from includes our was develop in San the by In Vantage under city, South general general Council progress October. Francisco,

to market foot build is the of we with San construction million square in nearly zoning, feet allowing to the South upwards our X.X #X square us X.X With bring completion, square under Vantage the feet, balance on to revised will share which, our of project that Phase XXX,XXX currently million upon Francisco. total coupled entitle expect project our for I

recently increases price has above-average to escalations calm. overall extreme the on prior The discussed the have costs. that in below seeing is down but update volatility year-over-year XX% we numbers Lastly, on the to beginning back pricing year-over-year, low We're construction some teens well come seen materials, an quarters. market

cost Looking next forward, to the to XX expect increases over months. be to see more range the we X% X% in

levels, times unpredictable on and materials We continue chain ensure and time to job done mechanical long supply up, times, while demand growth, items see to normalized have caused economic teams being lead minimal With wrap for for procuring the to our continued Science well-positioned an projects has excellent operator, let's challenges are strong maturities, overall Q&A. our our generators across early that, to long near-term focus at these mark-to-market given markets on lead portfolio portfolio. strong and, To extremely return like but the and the budget. delivered managing post equipment, internal to and core more backdrop the remains on line Life open up opportunities

Operator

first question from Markets. KeyBanc Austin our Capital And Instructions]. [Operator with will Wurschmidt come

Austin Wurschmidt

I on Life off questions to kick wanted Science. with

guys time, the about a years? mean You over strong, the coming on bit. seen talked what And and shaking front same hold. I'm And market you at you've demand the few for remaining in out see of rents next it put sort certainly projects balance curious just that the pipeline but could on supply how

Scott Bohn

Austin, Bohn. one. Scott Sure, I can take that

and in So or with is When back Boston X years. I probably most look you we me, but XXX% off the each XX,XXX perspective, next leased individually, I square the in X portfolio other think at has historical. years. line the demand feet the this record is -- the there a our obviously from highs as demand down space, excuse and think maturities past come of no the But market with noted, out highs, over few

about from million bit but peak, square down million Francisco, X Diego, X really million here supply-demand I the it's foot, coming other the X So versus X that large square to really seen we've that feet a is In we the square year. got about markets. San of deals the demand San ratio, this favorable feet mean, market. executed balance down were those quite X.X of earlier strong. our quite good feel

solid respect With getting levels on demand, pretty we we seeing hold. again. where to the feel compared put are about So supply, things looking at to are historical projects

projects, interest are some new on the remarks, prepared -- an making the rates having entrants in as mentioned are certainly people them impact I and on are infeasible projects well. the of putting levered As hold

market some think XX% well supply there will to perform that across So leased What over I very next we we question rent, we was But you overall, very XX the these our that months, the the those were was sorry? will decline. XX asked in of portfolio portfolio minimal previously mean the forecasting the markets. think last rollover. on

Austin Wurschmidt

Correct.

stack then coming in of to backdrop And maybe that rent more And Just seen does just the how market that, sublease on market for supply-demand up on sort up? thought growth? sets add what's how terms increase in space to the your if you've recently? any of

Scott Bohn

Yes.

from submarket. in all low mean, the market rent mid-single depending digits So a to been markets the on year-to-date, perspective, I X have

So we're there. seeing rent still growth

as Some is smaller the of from in coming of outlay from landlords in coming the to capital these far that less [indiscernible] cash some initial additional ones deal. some looking are as tenants, especially

as the So there's bands up the the driving which is capital the of out effectively of bit rents a in but is Boston's across that space allocation market. some from [indiscernible] landlord, X% a of little some the lot we're still outer in -- market fringe But higher, well. board. additional

very to lease. space So little

continue to the they mid- time. pace upper across Boston pick on there I up From high feel been the that San to really will torrid of versus little with were space rent well-positioned at X seen to and come all market kind San rollover a rollover have that Francisco Again, of we more teens very virtually there's think back we markets, through sublease XXXX. the think in in sublease when Diego. in no perspective, normalized digits market grow, levels not albeit and we over more So the XXXX 'XX single

as impact come that sublease been the space. the partial very out to market of minimal lot has well of seen So space us. we've A

really -- market for versus or of XXX,XXX subleasing square the they're X less somebody bowing the as And to been it's feet that's square with So coming feet, an market cash has maybe space tenants going X the -- out them preservation XX,XXX market for full years. extending more example, sublease the and runway a full-term under. their cash on putting out

think ride the I leased, XX% not in sublease out to impactful market think And us. -- with any been near-term. it's I we -- space our comes it's that for hasn't greatly again, can that

Austin Wurschmidt

then helpful life capital premium me for taking last where and just of trades about pipeline you're today the one then the are you've development that got risk cost how rates just seeing is I'm And of That's where to kind curious the science cap place, is versus appropriate for you're and your extent thinking currently? today attractiveness of the

Scott Brinker

I'll Brinker one answer Scott Austin, today. rate That's hard here. take cap acquisition question. the a to

was just But each precise just just can life their the a a buildings hard too in signed. building. that lease it's whether important, a the general, quality think I building is even of so profile, tenant maybe mark-to-market, it's near mark-to-market dramatic right? versus have to the different that the impact more unique, be the with XXX% the trade deal submarket, science because

So like the perspective market look IRR just kind we the stabilized of paid look from what at versus foot an the like. current rents yield always might per that price we to to understand look more

know on have to science in it be of from cap of we have does rate XXX increased. with on, life space, a impacted Obviously, pension dialogue quality it's the we the all full equity, private less won't with in interest sure, last that whether approach like conversations super pretty you today least And unless the products. kind And months. But REITs, active the capital feel last in tenants for dynamics. goes given ongoing that an the So in obviously, forever, in points the chaos of investors number funds, list just is most say higher don't understanding misleading that those unlevered submarkets have space. have X IRR different is reported try maybe and at anybody we them. no the good that of in angles and the all I'd It fringe of but surprise I a all can have basis in buildings that the markets. more still with there's been

So our us, returns On for on our locked each cost for that's like $X billion Harder to project is well is GMP given look on what current pretty development, And our it's . view unique. like, comment contracts return cap at pipeline future rates. and a pre-leasing. in of least on

progress But making are realistically, good until won't X of the markets. have all kind of the timeline. entitlements permitting of any core second across It's on We of half our we expected on them done 'XX.

we is of at sufficient. look of versus cap time, we better capital from until and a And X we'll acquisition know round a next better exactly get cost of market our rents our development have what pricing, have we'll can XX if rates perspective. return sense So like would build that and much how we'll just like see to now, decide look from the to and months what versus premium

little it's early for returns. So on a comment development us to

Operator

question Our ISI. come Steve next with Evercore will Sakwa from

Stephen Sakwa

understood. just opportunistic comment, with about you'd wanted a Scott, position. you I I said made be opening CCRCs your in When sure to you you talked comment, this make

make sort wanted pricing you the was So just Or that what sure, potentially right? that could over of saying? time mean I does you if to were CCRCs misread did exit I into

Scott Brinker

Yes.

I It's performing correct. exactly think well. pretty like We that you heard business.

estate. good We have real

and operating we've partner, a manage We good really have internal it. got good to a team

it. to perfect realize fit for a So the same not hold we're time, Healthpeak. it's happy we At

then an to about is view that. our there sense shareholders, made have for opportunity any we'd if So was point, that open-minded be our at

is isn't evaluate. great the So up sales on us, anything for point Obviously, ended continue it's with business XXXX today XXXX. obviously. something not cash. for we'll That Shop a market we time sale, lost that the $X on to of billion and is exiting but to it But in sell not

were done it's cash, or in a were lot done creative more asset those but of way, those whether of for some And a swaps otherwise.

story So have that I think a investors in create in the see how you're excited about. about going that be the more a to open-minded is that us and we utilize really to assets plan can broader creative business get point hopefully

that Steve? help, does So

Stephen Sakwa

that Yes, guess be I probably some sell mean I would I challenging it do. it without to redeploy taking dilution. and

I you're X.X%. development rates pushing -- put X%, I north those into you if maybe of So even been could it have guess XX%. of I cap -- kind at suspect believe would that

Scott Brinker

assets mean for done return We was unusually They to an cash. it then, when it's like triple those But for assets. strong swap It hard Yes. XXXX. we really net got wasn't even asset I we feel often. say. bought don't in trade

rates bit but for cap sure of as in there's that hard where upside So say portfolio quite it's are, to well. a

Yes, So rate it's business decided kind sell would of for. to what sell it. we cap that unclear

So overinterpret more you was to the if was exit ever redeploy. I a It open-minded and would there want opportunity be and don't yes, comment. to opportunistic we good that

Stephen Sakwa

the you the the which entitlements bigger, wave I the not And round really of before more of frame are priorities about of and you're start which just that spent bunch developments, getting in entitlements some realize trying for of for overcome able projects and being maybe of Okay. time to anything the the Can a you maybe second of kind in challenges markets, projects? of talking next getting us next of half. and out sort where entitlements terms near-term some to

Scott Brinker

go Scott add in let that Development might needed. I Scott? can and Yes Officer, through as Chief I run then where and our

Scott Bohn

the owning in through which being that and stakeholders, in a participate the we to the Alewife a various together working City Council we're the with hope Boston, core We're process in have to entitlement on group working on in perspective, all Sure. present markets. going group we put working Steve, Council entitlements City Obviously, where project early collectively going XXXX. X so revised there on. from our proposal

the on a well working our So process is that Area, as mentioned of there. we're Towers entitlements, out our In but I earlier going in Bay very there. that project couple as projects different Brisbane Vantage well

to City that that with with we think have so we revised more got Council, achieve approved into we'll the And general by able what plan much project. clarity the be

San project Diego hope all as entitling there we're are well going well. and XXXX And half I in as some So entitlements we've that's one of well. done that first very

Operator

come Sanabria Markets. Our question BMO Juan next will from Capital with

Juan Sanabria

made, [indiscernible] bit science or and just more you you'd opportunity market could little life And the big the an about entertain university-based I beginning maybe MOBs be. to at look that between comment on intersection opportunities? how Scott, and if wanted a

Scott Brinker

I would by the markets for have greatest depth demand the the say question. Thanks core of X that One, Yes. far.

We have scale to a the and the competitive relationships have advantage.

R&D. that that's got could us time, land entitlements big is R&D hard more. on a We to precise an be near-term year number, of lost It's be sure. we've that significant, priority progressing. but So it's about At obviously. same our enormous talked billion with $XXX And the It business. not on for a bank it's

for-profit not-for-profit the as clinical center or we considering #X with lot partners local So the especially lot office they're some that And trials, a level that in least systems, their doing the businesses. X academic plan being research priority, happening, couple to because more have system system could on with et are quarter, and out but we of a Not own. always And but our create the much their at we're big open-minded be three ways of types. to partnering a health and we campus. synergies are that they're #X markets would past health of business a reach long-standing even MOBs and have doing a lot have we systems, had, more between of on the R&D tend the cetera, medical them our of

not sets an road. down would a like proven at bunch going of as going business. from in of year, a core $XX way. successful or to not opportunity it that relates both of our opportunity skill and that X It university up the the we a very unique today's view see markets. businesses I'm It's sure lot forward. NIH funding as capital that making that's a but a an do R&D, the in utilize to commitments, new it doing the certainly, end we're it universities, is we to is And billion be the we'll not So if

same underlying the in certainly very interesting do So done it's on the what the into same core an and But biotech it's research marketing not medical capital it as X well. pharma. business that flows and we that's capitalizes exactly to markets

So yes, is one I too. mean interesting, that

Juan Sanabria

life know don't -- have that just companies biotech you or but of have exposure versus your drugs? I split the have Great. sense science nonmarketed And if in this, any then would you between rough do the marketed

Scott Brinker

market, I your asking? versus in trials are a product understand that might many correctly, well. as But question comment having you're what I If on ask Bohn Scott is to you're the how if clinical asking

Juan Sanabria

Correct. Much eloquent. more

Scott Brinker

trials know quite a have XX% around X%. do than may I with it's but hand? in on that Scott believe that product I less kind you know market, correct preclinical of the is Yes, low, Bohn, are me. Bohn off percentage

Scott Bohn

so you as are About deemed of Yes, of have And then tenants not our about, what in -- X% exclusively only tenants our as of pre-revenue, that's a you preclinical. right. market. which revenues, having typically product about are the XX% XX% mentioned, is

Scott Brinker

Yes.

Operator

come Rich from SMBC. Our next with question Anderson will

Richard Anderson

My now? apologies. me hear Can you

Scott Brinker

Yes.

Richard Anderson

Great. Okay.

types on of build gratification see long-term is years lot recent very no congrats looking So XX, XX if assets full Scott, span the sure the themselves to major market. immediate you CCRCs. major. positively about open-minded the to -- I'm that stock perhaps well talked the interesting my projects future. as on your of you word investments, question not perhaps and being in a and out. those mentality up forward And there everyone, My align changes, of mentioned question changes impacted there outset, opportunistic while by more tied is operative to the first the with

entitlement you talking it that feel more about? sometimes wag immediate I'm could you that? flow tail but Or dog, cash do type offense, the at about our of well, you sort go on opportunities on some balance go curious advantage becomes Do effort the offense. that that a you think yourselves the when a might see of is say, how did say just market real-time point, of you're you let you sheet development it you should So not more through and prefers competitive be stock the

Scott Brinker

like of have but we Hopefully, phases Yes. time you XX for attractive in been that model. You It's accretion, life where it's envision a might X%, for environment. them you're and have at mentioned, that are successful we combination of years quite plus in an at waiting for final of so usually and do wait the pipeline but both us, science years to X%, to it's do both. market the you're when harder MOBs initial making minus was for We accretion, But long a least I the a life MOB campus the shareholders it acquisitions not some as XX development. for scenario right? kind an at pricing in projects. or it's lead mean money lot incremental. But science of

So didn't at will that, like. things opportunity exist on will like a love like you create unclear hard the environment it's But least year and balance the we'd immediate but active months see. that feel and to accretion, next be over our It us expertise. It's opportunities like But companies changed. mean, the have XX utilizing maybe didn't operational able to to I good to X feels in see there's more scale with very to XXXX we'll are or sheets pretty those probably see have we does front. what capital strong XXXX, acquisition it going an and next and be to access look that chance predict.

Rich. do So we're certainly trying to prepare ourselves available, if those become situations

Richard Anderson

you housing the But there. your a but Or is doesn't that we Brookdale it is feel has PEAK second way question past a wrong kind fit in point that former or in where there's changed REIT just through say don't happen wheelhouse, focal with a that the doesn't generally, business, does X has senior about your in the way SHOP if process, Is fit a fit well fair it's is wrong into the senior model well incrementally business enough. it? Okay. into model? or just that like perhaps PEAK. then And something more went Do that was it mind you think the anything changed -- years since X of with anything that housing what over just get the with point? your perhaps Fair we okay? it to So the doesn't on

Scott Brinker

question. that's Yes, a complicated

the to but we the senior dog life the and capital didn't out team, about office, in wagging portfolio advantage that's have the build had takes still the didn't the and a true, medical time. felt we scale, in fair by housing, we trying tail way. markets, analogy. really talked But the You competitive We're it and like We probably have that's science strong a in portfolio.

overnight. that do don't You

takes course a don't time. That in You lot of the that of even year. the do

down have was time. the chose ultimately of even a path. Certainly, a it's we more in time process time. we're -- ever So to It lasted industry see probably we go than out, turns going COVID and did mean COVID, expected. have we would that an to just been doing that, long I difficult difficult as Dream different the it a more

thought we play plenty investors But pricing into it that our really the led out, senior as we -- we there's we good good it time on we got well. to exit. good some maybe of got feel housing at ways in So and as really like turns thinking that for companies, out, turns got as pricing and

our story wouldn't read ultimately is investors? the It a senior to really that's rewards housing negative So had much on what we mean, view going just feel to help stock that and we're do price is here I into do trying do that. some didn't create that was I to was marketable just shareholders, we like we that us a so business. have

Operator

come with Griffin will Citi. question next Michael from Our

Michael Griffin

that TIs terms on be in needs, spatial anything Bohn, any would in conversations you you're current there that? going curious and Maybe maybe to color concessions great. or for both I'm in have having Science second. of sort of they're tenants, terms prospective like in the back for changes noticed additional with a asking of Life what Any

Scott Bohn

for would Sure. estate larger their I say, less if Michael, mentioned, Scott less coming and capital allocating are as from more they frankly, of I capital out it's anything, improvement perspective. of towards pocket real just a Bohn. TIs, looking

day X cash. rent a higher having are us put and in to think pay they that So I the willing

I are deposits even getting credit we're requiring think making But space there. as and look and improvements biggest protecting on financials ourselves reusable that be would their we highly I I of in sure pipeline the capital also the development underwriting drug stringent security and more letters at that think on that mean, also higher and by those of change.

think but terms, yet, I the it's for us haven't shorter that are seen date mainly people so give having we in to pushing to TI.

Michael Griffin

for terms? pushing you it think do be people is would shorter that Why

Scott Bohn

a Just bring just capital, up Board. to lease the package number headline a full about when smaller talking you're

Michael Griffin

described the I mean, and Got opportunity. curious, great on a an location you. That's And helpful. you A+ it's redev, as it Pointe Grand I'm

an understand capital sense I is partners. venture -- like you why have the be does it relationships seems to JV your with But there that like make I is So there opportunity for upside this. joint versus just if this it wholly guess, owned?

Scott Brinker

able that's to price the upside paid, portion Even I which a it high X that a to that time, stabilized good was ago, is months return. we felt the X X of underwritten X Yes. be from was we now. in to -- there the like but could that good mean Xs, to project, being upside. And were mid- at years project ultimately, or capture was

to way did feel happy So position time potentially redevelopment the It that does for help capital need well. addition be felt preferred to as all that they and that will up, to fees it's move. that that we value got Healthpeak us. XX% of together, the add the we you a project, we'll But along it a some a partner own we long waterfall great of promotes solid spend like when alongside we and paying of the kind us one it's adequate for offset the gave sovereign are like wealth that for was in in and

is potentially like the could free There's looking fantastic right? we be upside. some forward And was forward. a a for to up Healthpeak for this think is helpful as give But relationship We we it's So one. an a mentioned, felt of grow that lot and no new trade-off, to did existing confidence good lunch. we side a it trade always easier a partner partner buyer it factors as and I have all establish It's a that's in company than well. move we what that

Operator

Barclays. Our with Steven come Valiquette question from next will

Steven Valiquette

X of offer both us, my and to science construction -- markets. weeks And couple life the a new data science for were a out big industry like future a for titles. lot dynamics markets, but life it's trade the supply-demand the to on of related with across Scotts lockstep congrats ago, there specifically demand. across a X it office, the punch of guess me the Let There some things. coming the line, roles I interesting few seemed conference was pretty in

So no there a was real soon. expectation of anytime supply/demand imbalance negative

major question, want X as view on that correlation. guess the that just the question to for here. science But markets shared I And you life the you that probably and second the topic then really, share supply-demand across as first related far Something confirm construction view. I

strong most not as And guess other message, that's the can what Francisco you for quite just simplify single reinforce the San variable positive for in the of Francisco rank Just I your X you ranking the X like the this just best Healthpeak for the currently. San South market, Healthpeak of markets? market everyone to maybe in critical life forced still in just is own science big X as sounded

Scott Brinker

low products, relates with is I big if to strong, it of that vacancy, development our delivered Brinker. good the it's local Scott probably as But single Scott mean, scale, the I pipeline relationships feel pre-leased. have especially including the incumbents and would by with host, the lot being pipeline. say purpose-built I the a that all markets I'll it's comment ask Steve, it, and digit, Yes. the and as to they're Bohn X then well. start comparing I'll them,

we the it coming just mentioned has we Scott it, others. in declined into number entrants, tenants, South with relative overall X surprise I think new There's of But occupancy specific up bit years, the supply-demand tenants. do about. #X supply most San the development comfortable We'll share. I'm of fringed the redevelopment relationships therefore, that It some a been leased also across of conversions, market helps just how dynamic markets, coming the the online. if existing it supply us of to is have Bohn less That's to new or And relates product, office much sure huge given largest see. wouldn't market Francisco. a coming XX% our the maybe and some market and little not the feel those more that by But as advantage.

role on pipeline, over amount today. best question into huge get a more in that supply/demand all right? us, money go the asked, they period the So it that San of the All rate that the development the we maybe why then broadly, our South business about then X almost too incumbent, the capital make market a about of to and something where one of we and demand supply. to to in upside the rental competitive and that underappreciated business, impact we growth the it on the having advantage Even true. occupancy good players helpful I be like mindful levels past and capitalized like were was it were And the out we which in the of to huge the first do as but and in and is my our though the markets We certainly sudden, would that was beneficiary think it started We be maybe of experienced were and be demand and and you in might but come. at we XX% with to comes, rates. were basically XXXX fundamentals feel plays business been Francisco of incumbent can sky, returns, for decades for might stay a have worried rate of the all occupancy down. we no grows past demand time a solid to it like and sector thinking months, to investors always business with the about new XX is new side. we've The growth, coming huge rental really the of pre-leasing forever, the to a largest that and lot -- wave for And business, concerned of a we investors XX things never supply business kind that large think was by life the of how of lay the investment to are that thought didn't going more science just supply a

we you a make potential threat. Today, as saw objectively say new debt So business years been to spot for is of some of feel pretty have everybody better the raising acquisitions, fundamentals we at day, about lot we've now outlook that is At at starts, defensive XX probably debt financing the months, supply/demand today late get, than to hard a a been see market X money, outweighs at that in capital to development actually today peak, building. XX just actually have everybody's point, better the And business end than the allocating able supply right, super X canceled, XXXX, projects years X from to we delayed, like no might in the feel X out that months really returns capital we the no last over with that it, where we that is might would least call new easy, sense, to X, be ago. looking not demand. might being

And thereafter essentially in little to then lot we our XXXX development our years a ready of markets, So spot. across we hopefully, we're very don't actually maturities in like deliver, position fundamentals slows wave over exposure X lease when market feel good a and call to down whole it, we'll in the a with favorable X XXXX, are And of a be next if a have the next bit. have spot.

some thoughts on approaching marketplace. broader maybe we're how So the

Operator

Our Yulico next come will from with Nick question Scotiabank.

Nicholas Yulico

it, up far to talk a discussions any done quarter leasing additional there. development Grand, third if activity in San see South Vantage along sort and intent the redevelopment -- other of Francisco for I or got any of to about on there's activity terms letters you're follow Pointe you your just or to of able wanted

Scott Bohn

Scott take Bohn, can that it's Nick, I one.

well Grand enough definitely, market -- Grand along, range foot certainly at as that activity at some of space looking I of well building big, it that larger well Pointe there's redevelopment the to the Vantage. as going So square the really announce think there's we're far Nothing requirements for Pointe in new within fits lot our kind the activity in But today. campus as second XX,XXX as a that assets. in

So but would activity, to announce there. good the fully, really say, I nothing today board across

Nicholas Yulico

And you there cash of line Okay. from have sure, make guess for still I dividend, have do debt Great. existing could you then on is to the you the venture, understand made I close lot a balance just Vantage million have the over of else joint the I about a there just next steps Pete. capital want But I plan development rate to there anything to left I next portfolio? the terms know inflow that basically in $XXX credit development plan be next the is Is free question basically pipeline. flow to year? the of after the exposure. mean, about some the but we year. floating should -- sheet, reduce a on you thinking fund which

coming talk a know don't dollar there's that? capital portfolio I number can if you into the So from about

Peter Scott

you that rate will we When development more debt as put a and projects the spend to will in deliver, have purely we Nick. of when sheet always is debt redevelopment exposure balance and about our floating floating that It's result debt just When exposure, Pete. place. rate look permanent some we have. think financing

for If to a around fixed on a I'll those forward. have loans, and equity rate end at you a then quarter. second. We at did think $X.X numbers we were floating the attractive term this our use those also about exposure, We just debt we fixed rate, which billion close swapped of very rate gross

all down just our way take line So to those the will that balance from million the of X. around impact $XXX

actually fund a from and So coming because redevelopment online. a our EBITDA would we that the levering spend numbers from have don't what to up I without of certainly in development debt have perspective the liquidity now projects net really perspective our right from the to say NOI balance we

fund comfortable of But currently. it something doesn't net to. a we to had the attention levels good that to and debt run going perspective. we I think frankly, We're for think a actually from on rate paying lever levels forward. lot up, volatility number number floating creates a line, that's if the But So it us everything up more go a that, comfortable the rate at just would we us are earnings take certainly, is would don't and our debt

think words it. would that prepared his a point, that So of Scott could the could include strategy about include doing our we're a may I'm additional strategy to the asset at the capital change or approaching sales. find other look of repeating Brinker's We've shape. sources or as in so. funded. certainly I based are upon But we fully flexible bond some market some we it. our of a right is year deal next in good great We sheet remarks. conditions got is we're to that how have sources funding think way It's And projects just now over thinking balance

Nicholas Yulico

I I about for next think early is that That's helpful, of Vantage Pete. terms any guess to capital inflow the mean, JV, next there just in on year?

Peter Scott

Yes.

Nicholas Yulico

payment does upfront an there likely? Is

Peter Scott

is that an on would less million monies on a It's we upfront transaction, flow payment. $XXX little that that when close in. one There than

asset there. So we sale. have there also held in source is And another a for

have noncore held additional monetize selectively lot time not more on needs to certainly do we But the We've spent a sources. or in talked lot past. of We bond sale, in We about a talking the minimize from a about will that. for this to look asset X But would whole that. perspective haven't assets. that expand

Operator

Our with next come Markets. question Michael will from Capital Carroll RBC

Michael Carroll

does talk a proceeds Can Is what's on reduced on overall that asset little by that that there? look has that's going like $XX bit the it about Just on million. held value? you for Pete, expected that you just sale, market that sale the just that reduced

Peter Scott

that just gone for rates cap wouldn't read Mike. have I Yes. since it into other than up in much held that, likely went sale. more We're factoring into that asset

lot And we've but little down so there's more on not a that. bit, to just a taken it whole add

Michael Carroll

makes mean, Or beginning more the you talk That in III given Okay. can good entitlement. falls you sense. guys and the do of did will bit I the of you and those a you of I start Phase some market can where job next projects? once we guess, JV development your a I a those about little highlighting starts? Vantage pretty on that before II you sites? little you bit entitlements see assume the those closes? should ground get actual of kind break that have year Meaning, pursuing where leeway know

Scott Brinker

they're Scott it's are million mentioned Vantage you feet big. phases, Brinker. I Michael, total. X.X when is talking in square III, both II Scott Phase now those and mean, separate and about

Phase call to III XXX,XXX range. II XXX,XXX foot roughly Phase equal and the in So

the would we on pull to put to just to by would would too We would we or not it's lot just early not a the earlier comment with it's according goes at actually to whether choose But be do that all plan. once. half in we market. permits all over to whether ready probably -- not trigger. my of if that's XXXX, or But of the So second proceed, time, point product

cap on decision Now a if we'll prepare doing in that be and ourselves, forward go construction that's choose rates to XXXX do other that make on drawings, all we're to half the and of the we'll work right? of the to We'll the to so. and demand. that in are supply relative capital based a bidding position things second so But the keep predevelopment decision, cost able acquisition that we including

Operator

question Stanley. Morgan come next will Our from Kamdem with Ronald

Ronald Kamdem

quick of the ones. on A changes. couple leadership Congrats

of the was $XX X-K I severance potentially had to through, said going recognized. think $XX like Just there a being million million

and comment changes? with Just new there other also of comments done in just sort is what is of then sort the -- broader Or going what's everything any And there? of can on this sort on is more place? that you on all leadership,

Peter Scott

Ronald, $XX result this our we quarter approximate that of we since leadership to of that this ago. $XX a in was that in previously weeks not That early announced as a happened here. couple million It's is million October. transition Pete disclosed, the numbers

transition numbers So to we that role. to leadership that we to you the should General With any did you Counsel promote fourth as regards will in Miller Jeff items our towards asked expect those. about, get other see quarter be that

see approximately number So will as we both it as Q, $XX fourth be as our will our $XX think and that quarter to disclosed incorporate about that we million Counsel's CEO's million, departure General previously $XX our and you'll in million, that the departure. well

Ronald Kamdem

it. Got

the -- point? So charge essentially your sort of that will come XQ so in is through

Peter Scott

Correct.

in the that fourth see You'll quarter.

Ronald Kamdem

Life Okay. Helpful. And I could quick then one on business. just the if sneak Sciences a

to year? high sort talked the at Or this about year going organic those that the just this pretty for growth about should anything we is you sort for of growth As X%. of levels, think we're if thinking Is sense? have there about MOB specific as unique rate of makes being those sort forward, the at businesses look long-term sort guidance of X%, you

Scott Brinker

with I and in the comment. the straightforward. will and run year exception. let This vary is upon range, a to mark-to-market. year probably Maybe year others exception, think depending business positive in that here roll that, an Brinker I'll rate Medical start lease exception, more Scott by is But more normalized and was it office then X% in X.X%

Xs, right? that assuming percent But inflation I it's might above point I'm the low in business average, I at escalators that escalator X%, triple MOBs The point, Life in I but net grows at complicated. comes and portfolio guess industry our same-store Now some inflation to with more a my leases. X-plus it's at mean, at science not is that are change X.X% is And forever, more X% more that's probably to levels. stays the growth. in a opinion. fixed normalized mostly average back

mark-to-market varies but And rate. look our year. it's when by So positive, you around portfolio, it then your at entire across baseline the XX% growth that's

mark-to-market upcoming of maturing don't we're to So opportunity do 'XX, more 'XX, just one is around leases. at in and terms likely and disclosure 'XX by in thing give NAREIT meeting clarity that year, the because the we have much

business, with probably for to some positive in Xs going whether the have our escalator same-store some rate So that a that's add that just XXX will it's things given for start basis of up be should will But the a tenants year straight-line on in is contractual to then But estimate decent were over pick that or rough it's a the of year. not next in it the the the of growth then you to points in flow that through the normalized it then to But then you're in redevelopment. it's to low of you debt, bad captured and But pretty lower, all because any to time. give down, average. that estimate us negative years that a just mark-to-market and via rent thereafter. year a opportunity, of move it's give X we if up could mark-to-market and number that mark-to-market range year, free just impact

kind And at number. things of make is same-store assumes high a produce So the all level difference. very keep can it that that obviously, those occupancy we to today that that the

Operator

Our will next with from of come Joshua Dennerlein question Bank America.

Joshua Dennerlein

is to you development of I've just growth investors most heard one remarks near-term with your wanted on balancing are longer comments how dated explore guess pipeline. growth I the about from of PEAK your and I growth? a priority. Scott, concerns the I is of thinking had earnings in your opening you on long-term is the think kind

around great hear be to of it'd -- thoughts this. Just your kind

Scott Brinker

Yes. we've find to got balance. right the Well,

tried I and creation say on going to focus an did that and So the I earnings -- say value related to hopefully, growth. there's activities be intense

us. right estate health is long-term both REIT, and like real done There's public a long-term I need right mandate. estate but care real works the certainly a decisions, it catches investor, eventually, least doesn't. There's at Having really part REIT. also with a as mindset, So XX And not certainly, years mean, what if balance. not lost we it's the on this public near-term what find you're to you. it feel I has to the up I've a there of seen be mindset, making

naturally right, where the earnings core it's in need growth. super is time, And particular, lost value long-term markets, in the mind. through the of Life investors. are to do development creation got in we us which cap at low. Sciences, keep least So X get and on create also that rates in most redevelopment, some creation value But for near-term to We've our businesses, most opportunity takes to not

sometimes So value the complicated. they're other that to creation it's be that, Grand of straightforward. earlier, asked there And times, and a there, a a that And It's balance. pretty good is long-term probably relatively going it's Pointe right. more redevelopment balance example the is question was that

for of off entire you create the as XXX%. it's development. selling XX% trying that not stake on you're alternative was an to that allowed growth the traded at maybe REIT, us investors traded, create to publicly to hold a also today, to earnings But earnings outcome If far preferable owning publicly

long-term short-term earnings well but to creation our is as each is going So a balance project mindset to unique, finding the value as be way both the impact.

Joshua Dennerlein

development I years on was XX $XX then million. on X page, color. the like Vantage What cost appreciate like by And noticed that it Okay. to complete I looks up looks that? total driving [indiscernible] up went it Phase

Scott Bohn

This is Sure. Scott Bohn.

completed, plan So full that's able an with service we be general being building clarity that amenities the square have project. in that the we When related is building scope of increase to building totality X.X to the there. more million the we're that to sized feet got amenity facility

Joshua Dennerlein

in the reflected not that's footage? But Okay. square

Scott Bohn

Correct.

Joshua Dennerlein

that or of revenue kind just Is generating Okay. an addition?

Scott Bohn

[indiscernible] footage will The rent Yes. be their overall the will pay return the campus on based build-out. on based that. tenants square There a on

Joshua Dennerlein

Okay.

maybe fair way the up or the is sounds Is same. went profile that the a costs like return it So to...

Scott Bohn

Correct.

Operator

Our with next Rodgers question Dave will from come Baird.

David Rodgers

life that had the of function doing of in the if intersection If more function happening? about and again, it. changed more off-campus. about science that's the said just -- a of wanted and clarity wanted mindset? I And Brinker, MOB missed a comment kind I perhaps earlier, development doing off-campus? What you on saw of just where was it to MOBs ask I your Scott opening I you whether

Scott Brinker

I real happy at about country, if XX% as take Klaritch office But ask look to around I'm on-campus. of well. of you the the that. to estate may it medical Tom is comment inventory

year, small it's So if pretty that new you every at look XX% number. also on-campus. XX%, it's And a supply built about gets the

more it's the care health provided our to end a given strong bit leading estate, is that well. of health when consumers within of that opportunities So it's an the some good choice, But up system is we really we We're It's lot a setting. market, you've got much. which market off-campus preference care, especially real view to helpful to own our There health going ignore on-campus not us that's affiliation. large if XX% on as is probably times system. very health a the sometimes. all need the off-campus And lost are convenient, certainly too

better still produce glad to be growth acquiring helped we're Klaritch, that we developing MOBs hope select or least you'd add off-campus a that? whether quite But and we group while there to going just them. now, forward, that It's in open-minded will at anything at continues. us is love estate. them peer we real the we're for a best XX%. balance. find We going -- So on-campus the we're I'm to same-store

Thomas Klaritch

really Yes. certain profile I on mean the depends of I've off-campus always building. like It properties. the

You want of lot the some a buildings to a go hospital services they outpatient to departments in get and drive that acuity on-campus. facility can the can A same those higher lot of patient tends services. get off-campus

a just Scott As said, it's more lot convenient.

like we that on-campus. of So has type project. Certainly, our core been always

we love nice lot we continue So a are there would involved. but of off-campus projects would to grow to that be there,

David Rodgers

Great. follow-up That's on buyback. helpful. And for then me just a stock maybe

stock leadership, the on with buyback. your Just change Scott, in view

a did aggressive. You bit quarter. little the It in wasn't

know, any don't that I future. go or in of might Pete Scott, kind thoughts the where on So

Peter Scott

can. I Yes,

think our our rate straightforward. any more it's the debt. than reducing preserve think floating that's pipeline to and We right buyback. going prioritize get development I prefer type now we cash for important pretty We and future from opportunities, our funding of could minimal active we're accretion to

Operator

Our will Malhotra from come question Mizuho. with next Vikram

Vikram Malhotra

specifically. first life one on maybe just sciences So

what update watch being X% bucket. talked I Can watch of down. that quarter, science at then within think X% you may you June to life think market? about the risks I And And stand? where sort last list the came your be list us just your NAREIT, are by

Scott Bohn

watch funding last business. the But watch quarter, XX% generally We're we in cycles, the since a Bohn. spaces, their The of list currently of and sub-X% M&A portfolio on our remaining funding Vikram, really a or size is come hasn't the off still course Scott line. those few over changed quarter, in had about it's events normal still with and in tenants to a the mark-to-market. following part it's levels, timing of historical of which come those on the the due some mainly list

at general coupled when who we screening. that balances, were There's look factors and balances, think low impacting our company-specific at list, cash are those looking top of are our assessment cash announcing we do I that -- other on impacting with we're groups or that's layoffs that a general criteria. are watch but analysis,

of to have me, the headline breakdown list. So short watch that on that not market is get in overall a don't change by you. the lot I in of can story number front I but

Vikram Malhotra

of in I'm investors even -- example, a get aspects you those mentioned balance terms I of Scott, just Great. just to -- of Okay. specific little maybe more tilting towards office revisiting like you want the excited. couple questions times one, with more And a to that So you'd sort changes risk? and medical growth more of in of the how some for wondering then some maybe get comments. maybe off-campus bit. more

data lower and own shown Your has off-campus retention. lower has growth

more just between if can of maybe achieve do can I'm of how sort just kind and growth quality? -- So that you long-term? near-term break balance out you you if versus And

Scott Brinker

Yes. it make when I we do mean, sense. markets capital would

and not any going assets, stock at bunch misinterpret So issue go to The we're of that were a right? $XX plan, don't and the sense. make buy to comments that's suggest made need economics out to

make Let just clear. that me

point and underwrite. to what us have is second we relative relationships reduce operating risk The expertise do allow other investors that to may

way that, our me, So is in risk to to key we do. able to than platform or advantage the and a the underwrite to need is general is offset marketplace the utilize different

So hopefully, that answers your question.

Vikram Malhotra

more longer-term, trend? of then like does. at whether think on- this It it's trying Others And you years, where anticipate where or to mix of just Some about just off-campus eventually, your last X XX-XX. I'm to and XX-XX. peers X just one. years are

ends high-level a today, do up as where off? on Just view think and that you mix between

Scott Brinker

we're I to feet, it's at on-campus or on-campus. I XX% X% adjacent mean, still mean that's directly and million heavily weighted towards another square XX campus. X%

pretty a high that's level. So

an do awful number. acquisitions to materially to have and that We development move

off-campus, that the match still So long-term would and that are certainly with of moving Again, we it I think profiles the favorable still there expect estate. be own almost just have is XX% would . real to huge bucket on-campus inventory this right substantially properties that sense being make select growth to It's would to model. on-campus in forward.

Operator

will with Our from Green Pawlowski next question come John Street.

John Pawlowski

just systems Klaritch. Just There's you the one business Page with for Tom about financial the question that on in partner maybe health a MOB few solvency. XX concerned we're that

major understand office to medical and us portfolio? impact needs just you if an your reasonable in a what help could of So bankrupt would health to goes see be adjacent system retenanted, get hospital type occupancy

Thomas Klaritch

Yes, John.

of you our look, X more of affiliated with health at I to who under but by health occupancy great, systems maybe a Typically, them the the strategy owned But they're partner run. out the Those profitable. a transaction, from in we good get with we're the and that's And if X actual continue the great a system, those doesn't hospital guarantee certainly that underwriting want If But long system, they're there. or hospitals we be has market. operate in any matter And to going and we share, to they'll margins, market owns when Obviously, the them. in to monitor has good we been always underwrite perform some well. it system. sure anticipate hospitals different of the than health of the that, we wouldn't any drops or are make affiliated really the continue the we're top look hospital to for changes. really

John Pawlowski

dark, see But X- X-year community impact get does do near-term hold that in on a Could a near-term? to we the systems period we health go if a occupancy? you see

Thomas Klaritch

higher X we community get No, months, buildings bought and the the that perform we those or ago sometimes lease high averages. Their under master Every margins years Those financial they the when not did hospitals. at monitor we they X of hospitals end X are to to on bought all. at In than them. systems, corporate any we of Xx health them statements continue program. Xx CHS

drop wouldn't in needs So and we near-term to any those in anticipate communities, will long-term if those drop operate hospitals continue of facilities operations change those was or just a a in ownership. the there

Scott Brinker

lot that so as corporate specific just on John, point well, important is example the because -- these that's final of an of hospitals. profitability it's that I issue in Yes. use a have not one but is one CHS, that Their debt their they issue.

no the owns future to right, that any bankruptcy, imagine now to have they imagine debt. as level So future hold okay? not, not whoever have highly because that are These or using because these they're I whether the CHS hospitals profitable, it whatsoever corporate can that would insight to just -- problem, example. have that's in doing to your it's I or their in I'm in be would I was the on the everything are hospitals

that. So no we to have exposure

Operator

come Nikita question from Bely next Our will with JPMorgan.

Unidentified Analyst

Do you like one Dallas, portfolio you so? talked rent stats on redevelopment XX% for is, have other million any about I it? outside second pre-leasing the the significant pre-leasing where about percentage pipeline What of that's or And $XXX structures developments. City your the believe in Medical roughly

Thomas Klaritch

rent I'll is This percent Klaritch. Tom take question. the

question? other medical Scott, kind to Bohn, you Medical odd probably percent there And our to X leases you question? pre-leasing XX% rent take have take do or makes redevelopment office. out in us other of want want Scott We X structures do than the but XX%, they're of have portfolio rents. small Medical the the City very to City, percent on

Scott Bohn

Sure.

the I on not we're really the science some mentioned. -- some We've . had success want X readout We've certainly, And side, life pre-leasing leasing talk into good goes. Pointe are as activity pre-leased. got Grand I of We've buildings on. far you we TK, we're to any on about the then as So the on of know, MOB at if those that other don't going those working got the that side,

Thomas Klaritch

range. The always on to kind XX% pre-leasing been that projects the of in has XX%

see that. to continue We

If project, you into just look at the the we put program.

there's pre-leased, probably active always the HCA look potential LOI you and pre-leased, program, discussions. XX% some total But in at This now, quarter, it's that. and under another XX% if X% discussions or LOIs right it's behind

Scott Bohn

there. our one on Towers Point conversions is at then X doing XXX% -- got of are couple the pre-leased Point and just And in readouts pre-leased. well. When we're to X where Oyster And of X in Boston at we more couple follow We've campus XXX% that Francisco. Hayden, some X the there in San floors South more is Oyster pre-leased. Yes, at a Towers, of a as

Operator

Credit Suisse. question Okusanya Our Omotayo will from with next come

Omotayo Okusanya

ones quick for Two me.

of of the out news On tough just space in lot hospital a the coming general. MOB side, really

you're tough Just from curious they're the future very if systems the that kind hear what kind now. that's to starting kind rent? is Just of of push given whether fundamentals of impacting having ability for demand curious development, to hospital MOB impacting right

Scott Brinker

to pipeline, we costs speak commit those really and can few standpoint. us there before on anything. we're in we're a any But our development discussions I from Obviously, returns to Yes. hasn't HCA with quite been impact monitoring potential to about leasing a projects.

some for HCA significantly issues, really look example I'll quarter. be. you of we of operations. couple take the admissions years to leasing this is actually the above an -- past where wasn't the if the of lower Our result core as expected at Their year it actual And

actually surge the were year luckily, there didn't COVID X%. look where of And year. If a admissions because COVID back cases, year this year XQ result Delta you continue variant. in last was Obviously, of of to 'XX, last this XX% the that was only admissions their

were X.X%. So if their you admissions take out, basically that up core

CHS see So And as move up late health we of forward, results higher since anticipated, think, actually systems. see and to you they continued can of XX% than were I their about our week. we're that strong going announced last results, is out stock many the they with

Omotayo Okusanya

I pipeline It and remain But sounds commentary just the a kind you time? like quarter you then expecting versus comments in know And overlay development can did around side, optimistic pre-leasing I don't think just really just good whether overall helpful. that kind again, That's life grew of sciences provide on of any to the particular, over you're space. and that? soft just the about I Or it's how curious quarter-over-quarter. improve

Scott Bohn

right, has But we've that list space It's Scott the Bohn. pre-leasing. X Yes. you look developments, I mean I at any think there's I that only if available. of development mean maintained our XX%

X matter getting So it's that not lease of on a just building.

not available so And size a the there's spaces sample big within of portfolio. development

Operator

Scott question-and-answer conference remarks. I our the to back might line concludes like muted. be your turn This over Mr. session. closing would Brinker to any for Brinker,

Peter Scott

Pete. have but muted, think Scott's this I line been is might

of next seeing of our that after our look all for and tour call in meetings weeks to And really think I the and NAREIT at forward property concludes you today. that. at actually we couple

seeing Bye. much. you to very So Look thanks forward back.

Operator

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

disconnect. now may You

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