PEI - Earnings call transcript Q3 2018 | Pennsylvania Real Estate Investment Trust

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Operator

Good morning. My name is Heidi, and I will be your conference operator today. At this time, I would like to welcome everyone to the PREIT Third Quarter 2018 Earnings Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. you. Thank Instructions] [Operator Vice and Senior begin you your conference. President, Crowell, Communications, Strategy may Heather

Heather Crowell

morning, you and us Good you. Thank thank third XXXX on all quarter earnings call. PREIT’s joining for

events measures statements we and to make securities call, and will discussed. included PREIT are measures These to the Company’s are other subject trends I’ll call or of set PREIT’s Joe relate other documents beliefs, statements has and meaning filings. Chairman management makes to on over call results. not be filed of XX, affect such the undertaking reconciliations Coradino. matters CEO; uncertainties risks this makes McCadden, SEC. and are of to the and with Joe During that Coradino, GAAP earnings that laws. certain forward-looking these are any release Members accurate no of its of non-GAAP turn PREIT measures within forth that the such in Bob will future in be federal today comparable only SEC update might Statements our PREIT projections, risks the and expectations, XXXX and certain might the now historical today, Descriptions to statement. facts CFO. today as October Also

Joe Coradino

the again Thanks, difficult Heather they and good find sometimes Halloween benefits of unpopular. reaping making everyone. morning, ourselves and happy when were We decisions

of three Today, and that well will completed, to productivity program malls questioned our sold ramp low all beginning sit of decision NOI of did to many second allow lower XXXX. anchor retail same moves level created. projects a that bold once of to are have XX over quality of the for of we resulted testimony frequently dozen a all And rates our replacements experienced as which the in earnings. vacant. be Early in our portfolio were at us disposition of the half made these started anchor is and environment. closings, this cap assets contrast, the curve have almost productivity NOI planned we Our changing we ahead the our we in on, dilution rapidly spoken in with which are same-store of we we’ve In before sell solid

decision time that here made have in and sit this understanding pursue the short-term well also only when so country. We We this address for stores available anchors, department the eventually that report were did to struggling and spaces would there XXX reports big-box we in a to tenants result four at proactively could disruption. of we replacement proudly store today Sear over

substantially we’ve industry stream. of continue we quality outside anchor in doing with We warranted. take are with replacing results portfolio so users terms generally about rent, risk the stores our with better our action are notably the not to driving profile. Putting it’s growth we’re us stores credit, paradigm. as NAV substantially that bold and doing relatively roster the and are space, traditional paying appreciate, our a our and our indicated Today, Clearly, about can the projects reduced department these times and it completed earnings our of But optimism department more of the and of excited downside is the that XX sales underperforming incorporate the just XX you of associated unaffected improved evolves opportunities. users mall three diverse

e.l.f. Cherry In Boston of fast native talked expansion nearly our of which have a XXXX, just six years, three XXX,XXX square Cosmetics going. XXs few peers Forever have differentiated about brands digitally Hill where boldly retail our the restaurants, Hill, uses only for in As feet with portfolio. XX, unique of signed Peloton, and our mall includes future gone four at openings. pop-ups, we September That incubator and have wealth we to offerings fashion of are culture new Mall,

forget head are generally locked construction costs cost In rising issues tackling on. Let’s not environment, our ancillary these a of in. the benefits are

supply, We was head. have secured turned tenants before demand its the equilibrium on

Our attractive to portfolio new is tenants.

by for two executing year leases evidenced right, the the double, amount third space last in we As that’s of times did quarter.

renewals the year-to-date, X% on spreads point prior rents over year. increased of driving renewal improvement XXX basis We’re with a average

record per the are same-store by year-to-date. six $XXX notably, Our square consumers quarter driven up wholly-owned shopping malls, repositioning highs at undergoing anchor X.X% of centers excluding And the properties most foot, for was reaching with to appealing X.X% organic NOI sales growth. nearly our and

Looking the Foods and Five HomeGoods, at and at we Mall Goods/Field City at and Moorestown Wine future, XXXX. Goods, opened Sporting a past see Mall. Valley Stream Five Burlington. the and at year, HomeSense we’ve anchor at Viewmont Sporting HomeGoods Below and following at Spirits & Capital Belk Fine Exton. Dick’s to Mall. If the Dick’s Mall, PA Mall. Magnolia Whole at we Tilt bright Below look and replacements.

Woodland have of Mall. Willow that Meeting traffic. balance worth repurposing have We It’s projects and fruition Grove Plymouth noting to Moorestown the at Mall, we in replaced just occupied replacing approximately Park Macy’s space coming of the model, anchor the by at XX% Mall, XX% previously Moorestown of

we to months, with open to shell XX% tenants over have as X/XX/XX. on and in also near on project of we Fashion just Macerich core set schedule District construction, open over completion committed commencing our are and XX We

List, Macy’s These of step to the pleased and merchandise high our Growth and retailer the will continued receive were Hill recognized another stores experience. and we improvement, quality portfolio As were to further by testimony XX Town stores as of overall as and in anchor upgrades have Center. two Cherry toward our potential shopping Springfield XX on

average lease as will anchors of backlog. the to growth receiving, rent executed the addition significant coming eight co-tenancy the with online result we In along obvious occupancy were embedded growth times from we requirements benefit recognize a of satisfying at

Viewmont puts of us the in to experienced with along Malls, in up City sales position and a $XXX traffic at we XXXX. in in We expect second that referenced that the eclipse half occupancy and NOI ramp Capital and improvement Moorestown the have at

have successfully of quality and through remerchandise. disposition addressed the We the improving portfolio

continue strategy. evaluated capital of ongoing. in has several additional asset based to have that do accordance invest transferred careful appropriateness in servicer. We allocation in being on Valley with in Mall the either. anxious to been Wisconsin, our additional which investing capital We Valley, at not the Wyoming is That process not to invest are assets special this vacant capital View with we’re capital plan anchors three LaCrosse, additional Similarly to

XXXX, pursue our to capital investment. require We commitments, that options have continue a maintain and non-recourse but mortgage coming don’t on in this optionality we due

identified keep densification reviewed these $XX raise we’ve to over be these good to redevelopment capital We For prospects. in case all cost investment. Sears is remaining. intents tremendous already forecast what rent a They’re million. Through in of to considering with be opportunities impact to the list less to And and these as of a well carefully to we the purposes, or requirements, immaterial is like at. located noted, fund and we’ve than our markets prospects us rent of identified worst estimate to opportunities liquidation $XXX robust Sears scenario. X.X% our as capital co-tenancy approximately we gross have four And – asset we’ve proven sales, doing view potential million. future annual primary to we redevelop

our discussions having on As the and opportunities concentrated with opportunities a D.C. to and we’re in first these each. result deal early of properties and we densify markets, at in pursuing properties a advance closing hotels. anticipate have XXX in for and portfolio November, additional and actively units And Philly are XXX these multifamily between significant multifamily two currently multifamily

agreements purchase the moving near-term. hotels We’re and sale also for engaged in and negotiations in several anticipate to

when here repurposed credit I great quickly properties offer before where have customer that anchor we going confident turn with want we it to excited offer we’re have have that products, that customer we Bob, reiterate our moved. really I we’ve vacant boxes with better consumer, our our have densification unique Now how a over and tenants we’re and and to have opportunities closer about the We’ve great of in shareholders talk our I’ll With in could haven’t resourceful about place, change for. to results Philadelphia resilient ask our victories Bob most to quarterly are the they will and District getting outlook. It Philadelphia. it that, a easy, Fashion and and to team been we opening But and hasn’t been turn retailing over pattern obvious. it

Bob McCadden

Thanks, Joe.

benefits point and store reflected the for the our from the operating We’re co-tenancy prior department bankruptcies third from results. backfilling we’re in period impact Residual portfolio of inflection starting our and platform. drag store of an of lower the on progress and to closings, reaching our actions benefit but departments recaptures quarter, performance results rents quarter significant see We’ve vacancies, made improved operating replacements through on reflect those were proactive a our resulting transformation. of

long-term have a pipeline that reflect been along metrics portfolio in strengthening business of improvements with fundamental made sales in leases portfolio spreads executed resulting future record robust leasing and occupancy. for Our our

me provide guidance. our results our Before and with our an operating on plans, spending review update start I capital let earnings

as of the revising of of the maintaining and for fourth and first operating to issued adjusted months midpoint XXXX We’re GAAP to our estimate for narrowing our and expectations results earnings range effect previously give the the of FFO quarter. while FFO nine guidance,

$X.XX and as $X.XX FFO is be $X.XX. For $X.XX diluted to expected expected attributable between adjusted common net between year, and per to $X.XX, and to while the $X.XX shareholders full expected be to is is share. loss be FFO between

is issued full one quarter guidance guidance assumes quarter to our Our lower of a the the range including towards to fees a termination in two end termination lower fees of percent. previously end, at year assumed

at share helps additional part to a last also the quarter offset Exton in unanticipated Mall includes of gain as of our approximately experienced as closings diminution per densification of our in land initiatives. the Our parcel announced guidance $X.XX a and developer sale This previously the of Square rent from year was progressed. as result multifamily a some included to guidance

due this seize and wasn’t the associated incorporated matured. transaction, until it into with fully As to guidance transaction reentitlement the continued diligence

in early November. We that expect to close in transaction

evaluate this low materialize. fluid high as is of them sector, and end range we know, call and out define moving they the pieces you the and the a As that highly guidance

investors helpful performance and press our Before that included disclosures trust With useful forth transition, period. bring set portfolio operating to your of I our wanted release. drivers business we we find our made financial additional our I these we to will in the from transformation. We to disclosures you understanding would tables, thought analysts period with some be key in FFO your into results, to additional our to that to get it attention

NOI, X%, of growth the benefit in performance accounting to down $X.XX our period numbers. factors. compared reported the factor last comparative most year’s share a appeal tax for impacting share review let’s was our after was Now in of Thanks a assets quarter. sold. We prior $X.XX was as several reflecting FFO to significant adjusted multiyear $X.X impact a The third settled that a million of the

same-store If item, you was normalize NOI up that X%. growth

if same-store NOI the More year. the NOI undergoing for quarter our and exclude look and importantly, our up malls repositioning, is the properties wholly-owned from six anchor X.X% for performance currently you our in the at performance drag X.X%

our to our up sequentially occupancy points stores at XX.X%, an balance While outperform results XX and bankruptcies this left we beginning to their Total our was joint total see core will through improves XX When executed by are show as continue venture we’re points basis our occupancy year points to of factoring properties wholly-owned XXX and leases, non-anchor into in joint and the from non-anchor XX.X%. malls improvement XXXX. indications basis up the venture basis additional occupancy to in add properties basis would occupancy vacant that leased XXX at to properties, occupancy. to was points our operating

over openings quarter, additional $X.X our foot. revenues. additional an of have add to of million have square open Sales square will in which square and $X.X malls feet in the XXX,XXX revenues. open an portfolio. balance per will later future in October, leases NOI-weighted are square will in sales same-store our square increased square of We feet foot and at annualized per core together The this we of and per the foot XXXX XXX,XXX XXX,XXX feet contribute for annualized $XXX record opened space executed million to X.X% pipeline $XXX slated

income Interest renewals. final is the average JV In point during for the we the volume borrowings, being the of XXXX million, expense. leasing down was credits is quarter, year’s million XXXX. in increase quarter. weighted expense in spreads period Series of our quarter amortization to an small a share for $XXX,XXX lower credit which increase $X preferred average from day historic Our transaction these credits. our third at shop from first the XX.X% $X $XXX,XXX Average new The a generated. doubling third year of capitalized due increased of shares with result continues offset higher increase in of the preferred basis A over of offset large and XX to interest portfolio by were third recognized increase for the The including The X.X% to team redeeming quarter five-year of format recognized was by October XXXX. of partially as rates, were amounts income, strong was our share dividends in interest. renewal tenant last by wholly-owned of tax deliver quarter spaces over

$XX mortgage our the department replacement comments on million $XXX on year We program XXXX. this unsecured The anticipate XXXX. million extension of The additional balance considering loan matures Mall capital was available completed term non-recourse wrap an $XXX it plan. million View $XX our unsecured Valley loan options. has and from redevelopment that when our I’ll the July some in until and of spending obligations over earlier recast these of XXXX up credit million maturities Now with facility store extended

debt our doesn’t until next maturity that, Beyond XXXX. occur

liquidity. was period end leverage continue our swapped, $XXX ratio for of times payable of end debt-to-EBITDA basis, per quarter of At that, at of had with fixed XX% to and a we be And the we’ll payout On was rolling last up ratio in expectations, we for XX% debt fourth ratio or over announced it we XX%. in adjusted consecutive our $X.XX positioned and – our line bank at share a of XX.X%, XXX XX-month rates. our maintained with FFO through and well manage either million dividend FAD was was week, to the Our X.X open approximately September our net with rising the interest With available our December. payout questions.

Operator

comes line question ahead. first Citi. your go of Please And from Instructions] McElroy [Operator the with Christy

Christy McElroy

Hi, good morning, all.

for you that? Joe, from $XXX of time to your all Just the more multifamily about million the hotel Or and following rights is to frame that? developers? What’s comment the was the selling on raise. expect up, to And capital that there

Joe Coradino

the from few capital going non-income there the actually in well much will that it’s that those the sources. hotel bring some dollars. pretty – multifamily the which which land to a agreement be We today the is Certainly, outparcel is of are doing in number time Well, are some think sales begin ongoing. And the but of will order producing under as frame we as in it. parcels again, next much part and weeks, of properties raise income it are that are

Christy McElroy

an you’ve any or deals? upon just thinking about to know on provide update you the talking any partnerships hotel of whether ownership that be several And months just not been you’re I now. and expect Okay. mixed these then back following retain multifamily in about these used for developers, May and how

Joe Coradino

deal In them a our the close on as that war and have be early We’ll we’re as envisioning November, of will looking a sale, primarily one be at initial cash a at deal, said, I we’re bidding properties second to transactions, where sales. on going a actually and we in well.

more cases, would interest development, sheet, using begin As we’ll use to in the way, up it. and probably but as possibility putting to our land balance that direction deal we develop in a the in by we shore to feel others more comfortable of the move into maintain old the our and

Christy McElroy

disclosure the do release, at looking same-store. to components the press new changes Okay. we and And which then just Page of XX appreciate, sort on of the Bob, the of

X% it just same-store have to to remove be the appeal the in the closer your been excluding May looks sort same-store to opening positive not assuming you guidance why closer I tax bridge would appeal? $X.XX with it that being field think gap? growth impact tax your quarter can about tax the full headwind, you comments excluding growth. that’s is year If the like consistent is help flat, a remarks the is X%, there us fourth there of

Bob McCadden

going department View in from We’re We in store continued LaCrosse though had of at the have to impact Mall Sears quarter. closings closings. two department quarter Herberger’s and the Valley stores during both close

a once co-tenancy So we bit in to as – expected from will a secure closed, the then up have that. co-tenancy a to is quarters you a additional the in rate ramp the co-tenancy quarter drag fourth also run have as secure period. period earlier fourth when And ramp-up in anchors quarter little still where rents. compared situation And the this is expires, have typically the in

Christy McElroy

Okay, it. got you. Thank

Operator

with Your next Please line from the go ahead. Bin question Kim of Ki comes SunTrust.

Ki Bin Kim

Thanks.

want Are capital the you on, clarify you’re that actually is focus sure that that that’s question. wasn’t you to to the the raise I land dollar know to coming looking a $XXX previous to said that sales. be from Just I of that the majority contributed if order you volume? saying million but want of

Joe Coradino

Coming from get I what? Ki Bin, that. didn’t

Ki Bin Kim

sales million? Land $XXX the sales, outparcel or

Joe Coradino

No.

are more land me have it’s a let in There we and of of Gainesville, are multifamily part developers. we land I County, Florida, sales, some parcels we’re Chester hotel to think about speaking that of we a – but property bit when well, in or have be property sale of speak also land Pennsylvania. specific. that, They

of kinds sales land to so speak. different two really it’s So

pieces, and in outparcels number take our we other The a monetize of outparcels. our interest would as well, in where

Ki Bin Kim

asset producing sales? saying million Are basically Is you can that think combined, all those you things non-income correct? you from $XXX raise

Joe Coradino

of we we will again be income-producing. The be – No. of back, But as bulk well, we case outparcel worst getting the at the look income-producing. of it be I it boxes non-income will say some the make really situation, It’s will the in are think producing, $XX going those didn’t Sears back, million, two entitlements, boxes by for to go a cetera. reality a through tenant, XX time you the or not to you’re years investment them et close to get while. find going that but in months take sales

up So Fashion up stores, we’re we’re opening that’s opening on, District. going while department

on hotels kind to now. right any quickly pretty we We time and deals the see on our of said crisis maturing don’t those residential working to have hand and we we think So speak. a have lot flexibility been ample that, Having so are execute. and a of

Ki Bin Kim

Okay. I Page XX, ratio months XX%. at FAD the months this dividend show not Under year-to-date, looking was but And FAD your at for curious higher am why you your about that $X.XX, – payout your is not your nine from nine but just is definition, $X.XX, XXX%? year $X.XX

Bob McCadden

There’s that rolling fourth in you because a obviously the XX-month spike it’s says, big page in footnote a have typically the period, a quarter.

it of at for three would it the the first just inappropriate look year. be So to quarters

first done So of the consistently. of it’s adding that quarter XXXX XXXX, quarters up it fourth and really picking and three we’ve to the

Ki Bin Kim

Okay.

to selling is on bring covering volume I larger things But that been looking quarter. even other will a you’re I forward, really that the improve of levers proactively assets, occur. to ability lot if you from cash those if doesn’t great retain me posted flow. your job you start flow does but doing a do you some mean, Sears Joe leasing So give not strong it cash have you that my you boxes that situation, know and have guys dividend question working through guys this

dividend whatever for isn’t to retain the the rightsizing the for rainy thing isn’t or is? and terms cash made, you’ve Just flow? saving it to to or of just But more flow it right leverage thing do sales is day cash asset the a – in do right

Bob McCadden

this Bin, is Ki Bob.

our pretty year I talked the investors contributed X.X our for over think secure last is, being in anchor the we’re to expectations we income that replacements. that’s X we year, from think the

ramp payout to investor nature. we the benefit confident will on in coming mentioned, But stream. on And the ratio think up coming in some seeing see about District in anchor I Fashion on replacements, the we NOI, in is increase incremental in think of I XXXX, Joe temporary in be the showed extent, of in we something coming XXXX. pretty the the feel many half income second the the presentations stream balance later

state level normative current we’ll So be a more through forward. back ratio work of and the to payout going

Ki Bin Kim

tenants does other major if major saying guess, of that kind it even into I trouble some of in kind harder. couple – one run of XXXX, makes

I why I So that’s guess, was that question? asking

Joe Coradino

that, to were to beginning pay add the a Ki just occupancy rent. remember in are lot happen, anchors would to event rolling of taking I you’re that and in Bin, Yes. that

situation So the we think have under control. we

Ki Bin Kim

Okay, thank you.

Operator

ahead. Your of line next question Sachs. comes Goldman with from go Please Burrows the Caitlin

Caitlin Burrows

for talk Hi, the good wondering I growth you I morning. in the more half. you expected ramp mentioned if store just know second could XXXX? was an same- a about little outlook NOI

or I wondering else? was of driving in Is it it? kind something be line redevelopments So an improvement would what the occupancy or

Bob McCadden

Caitlin, Bob. this is

where start I the think previously dark come for of will anchors. been the to in in incidental XXXX the growth in we’ve co-tenancy activity had redevelopment malls also large in off anchor to increase part terms well we replacements – affected the some see as pickup we of and inline of burn from lot to as that and this seen had overtime by parts a the completed more space, the a sales the the expect of actually places

the So benefit from part the really that mall of the more replacement, largely anchor the anchors. be or it’s it’s the synergistic of the but catalyst mall. wing reactivating It’s – would rent than that just of the

Caitlin Burrows

Got it.

drag of then impacting less into and mentioned get XXXX? the should I But of then right we as co-tenancy you XQ the portfolio – maybe that’s think side, it that go you know as this. to co-tenancy And into answer on that Okay. so is the so the XQ kind

Bob McCadden

months. to mentioned going is it little should bit, XX up to the over a to I And XX start XQ Yes. as be earlier. mitigate next

Caitlin Burrows

is but means Got I could this interest you paying focus Wyoming now, being maybe servicer And what know of through any it. special – it Mall timing with NOI, a go the essential then of Valley expected in for some of the current not and with state disposition? your terms – Okay. recognizing definitely just expense

Bob McCadden

So big classified $X.X our XXXX the year in picture, – on will Mall our so Kind Valley decline start quarter about we and it’s shows will that of interest million in in it of loan. non-same-store up metrics. for roughly million NOI into and assets, full fourth contribute nine that’s significantly it obviously Wyoming core of the $X.X obviously XXXX, has to

of a kind So net contribution of roughly $X.X million.

forward $X.X As well the see because XXXX, to to from the revenue we closings look anchor we lost that of co-tenancy million mid-Xs as dropping the as impact.

that. So at X right recovering fall as X that now debt quickly but X, will or serviced below to perhaps X

Caitlin Burrows

Okay, thank you.

Operator

comes Your of Advisors. next Please Green ahead. Allaway Street with question the Spenser line go from

Spenser Allaway

co-tenancy release, breakout six you to lower as of properties. the causes some on revenue other directly NOI from just Can decline provide the how anchor such overall from earnings more you and secondary versus related some lost kind centers? the guys of footfall the color the that In replacement affect much was the

Bob McCadden

most of either co-tenancy. fixed that the in from We but the the that in have don’t rent of impact say I decrease and/or detail, safe to closed it’s anchors those think lost to assets information relates

Spenser Allaway

right, thank All you.

Operator

Mueller go comes the next question JPMorgan. ahead. Michael of with Your from line Please

Michael Mueller

Real Hi. quick. here. Few questions

mall like sale the the raising to several be saw asset contemplated over of we that a the sales normal $XXX to going part any or is are back years? be existing million, that Going last like to

Joe Coradino

of on pretty list but priorities. a is That far possibility, down our certainly it’s

deals. non-income-producing saying, Step individual far the asset outparcels, the sales County. land in JVs Florida was one, step step And three Chester four hotel et of I off As pretty sort sell Step and the list. two be cetera. residential or down would come and parcels or

Michael Mueller

helpful. if of a next look the that over then Okay, for QX? what’s switching currently that then what of disclosed the amount in? QX baked annualized in quarters And that’s And annualized happen gears popped at up number, we couple amount that? second co-tenancy co-tenancy should to is on the have So that’s you a bit, what

Bob McCadden

in we the from press the release, in change disclosed it’s our year-to-year. in reconciliation, co-tenancy really

the same-store portfolio $XXX,XXX. for number about absolute the the So in quarter is

Michael Mueller

is release, six the much you those Got – question. aren’t numbers. the malls of one money. that that talked another can just some of undergoing And Okay. us impact contributing it. because anchors you typically were Or X.X% NOI know co-tenancy? with the I In about then drivers kind repositioning, down that for the And through is was the all I think, really of, same-store walk

So what’s that X% driving down draft?

Bob McCadden

just to had previously. what I Mike, kind of recapping said

I think, the the don’t contribution we a decrease. can know to there But bifurcate of buckets. rent of that co-tenancy anchors lost to the part, that from individual impact I vast large a a is would the and for majority X.X% entire account

Michael Mueller

Got it.

Okay, thank you.

Operator

go the Karin Your Ford Please next line question with Securities. comes from MUFG ahead. of

Karin Ford

good Hi, morning.

you co-tenancy to the Just go Sears wanted to your be, went potential the going impact part about what’s back Recognizing have to bankruptcy? into – of those what were co-tenancy stores, remaining quantified topic if the happen as again. on stores that we’re still could closed unsure

Joe Coradino

Yes.

may We it’s to let don’t think overly about Karin, thinking talk worst-case me million in $X be that. So $X we’re million scenario. material,

many to the in think some if that we anchors I kind to of worst that became in we’re the position a pretty case. as replaced we good extent, portfolio, mitigate think

Karin Ford

just about tenant last now time Yes. right does Makes year? does talk pipeline where sense. Can leasing this versus look and to at demand it was you you how the how

Joe Coradino

did what QX Well, than XXXX at we a I of And at is space doubled – least best quality in QX than listen, we’ve in in business. QX we it this XXXX. did think speaks really that the is amount to

we’re we right. look at for talked we oversubscribed If Sears instance, you have well interest. four there those, about, located significant assets performing, is that those stores that are for them, When

We fairly robust have interest.

again well there say as So boxes both located, Philly, is demographic would D.C., well as interest. there anchor inline. significant question, tenant better And is no I fill to that’s markets,

Karin Ford

XXXX? last And think said will do on to expect question, that in And this When up, year-end do expectations you be just my you for leverage. peak? picked color. It it debt-to-EBITDA Thanks was at that quarter. where with you your line

Bob McCadden

to towards fourth the guess, the peak expect probably quarter. of year, And we Xs. in We are third, I high next end

Karin Ford

High Xs.

you. thank Okay,

Operator

from next the Barclays. with your Linda comes line ahead. And Tsai of question go Please

Linda Tsai

to unconsolidated Hi. finalized expect for was renewal due do was it or The in I in being XQ troubled understand this deals improve lease negative you to properties and XXXX? tenants. X.X%, with But bankrupt

Bob McCadden

Yes.

bankruptcy we’re we of would and workouts improvement think in largely Yes, quarter with through I the the XXXX. anticipate the fourth into some tenants.

Linda Tsai

it positive XXXX? Would Or in become flat?

Bob McCadden

think positive. trending will we it certainly No, be towards

Linda Tsai

for in on then what’s And I the XXXX, fees max XXXX? your Okay. know outlook you’re $X term around million. lease targeting

Bob McCadden

of year of unusual an because circumstances. confluence was This Yes.

think, we’re typically the looking million $X in of million I $X kind at somewhere range. to

So returning we to that normative more to levels. expect be back would

Linda Tsai

you can Fashion update in – an Philadelphia. you can on then And just District finally, give Thanks. us

Joe Coradino

guess, leasing status The XX% I last committed. Sure. we reported, quarter

about shape. original begun million point. shell did landlords The this if exciting will, reaching we of work, through artwork and at We’re at its conclusion. sort project to The installed art. you pretty Tenants is over walk the actually construction. have core at many of taking in XX% cases, $X this point, It’s a is in

year. excited about Fashion we’re of opening next September the District in so And pretty of

Linda Tsai

Thanks.

Operator

to call There further queue. the the in questions back are no I presenters. the over turn

Joe Coradino

next in again. call. Nareit the to we’ll Well, thanks, of many Again, thank being make San forward continue look you week. at on you And to for seeing progress. We all Francisco

Operator

This concludes today’s conference call.

may disconnect. now You

Pennsylvania Real Estate Investment Trust (PRET) 31 Oct 182018 Q3 Earnings call transcript