LXP - Earnings call transcript Q2 2019

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Operator

Good morning and welcome to the Lexington Realty Trust Second Quarter Earnings Conference Call and Webcast. All participants will be in listen-only mode. [Operator Instructions] Please note today's event is being recorded.

I would now like to turn the conference over to Heather Gentry of Investor Relations. Please go ahead.

Heather Gentry

operator. you, Thank Realty webcast. Lexington quarter conference XXXX Welcome Trust and call to second

The and at this and distributed a be earnings was release SEC the morning Investor and are on on furnished to the X-K. quarterly available both our in website www.lxp.com Form section will supplemental release the

statements call Reform of meaning the Securities Litigation during Certain events expected the statements this made results within and of XXXX. Act future regarding may constitute forward-looking Private

statements Lexington based are believes assumptions. reasonable these that on

including included the materially that Lexington's forward-looking a undertake in law risks time-to-time press and by and those update reports to to earnings from duty cause factors in release or by implied Lexington Lexington such certain However, does differ those expressed actual statements. any results could SEC statements. not today's those required described Except with files from as

supplemental press company holders funds measure. Lexington measures available equity the and most quarterly In basis. directly non-GAAP to on fully from these unit the to diluted reconciled and in financial GAAP disclosure adjusted a earnings all company all refer references to documents to package, comparable operations release holders has FFO Any adjusted

of are to viewed of not presenting individual performance be financial measure an future Lexington a cash intended numerical financial or flow. Operating as historical performance, measures or investment position

results. Laura quarter On and second James and Eglin and provide CEO, ONX, focused Chairman presidents today's on Brendon Johnson will executive Dudley call Beth Boulerice vice CFO commentary will

I will now turn to call the over Will.

Will Eglin

Thanks, morning, Heather. Good everyone.

disposing high with our assets, of business proactively activity. activity with This results industrial stated assets expirations. Our leasing lease and excellent acquiring aligns of were strong acquisition, non-core second and disposition managing quarter objectives well quality

becoming our read to progress towards an on tenant properties. we make efforts, single continue goal focused lease our net industrial Through focused consistent of

our gross our portfolio quarter value. represented exposure consolidated book XX% of At end, industrial

in acquisition disposition Given activity. positive trends and our

to the rapidly balance quarter. increase our over did in of We second than year more it exposure the expect industrial the

asset occupancy overall almost nice to improvement activity least saw due seeing also during in consistently XX% vacant to the We a sales. and quarter acquisitions new

sheet satisfied primarily through shape remains our Our capital in with balance great dispositions. needs being

brought and On activity to gap rates the acquisition to cash of the average $XXX robust date volume cap both million, at X.X%. year during acquisition front, quarter

by and our although the quantity quality excited both are remains We competitive. the in pipeline, prospects market

currently We accepted offers $XXX million industrial have of new of north investments. of

quality, primary high single assets. projects tenant construction directly distribution time-to-time. we developers Our may And remains on on new focus warehouse with work industrial acquiring from

previously sale of cost freezer to sale the for in is of top are dispositions, million from preferred $XXX to the favorable our million. on The the price contract million. extremely This increase XXXX. currently we compared driven potential our XXXX is is $XXX property we of million $XXX stated Moving guidance under our plan end to by when $XXX range increasing disposition which facility, acquired our primarily

Last cap cold our arise quarter, freezer pending of objectives. we storage capitalizing example favorable that rate compression in the stated transaction outside is discussed plan the good significant The opportunities business of on a sale preferred sector.

capital well-priced to diversify and and At into warehouse cap this executed, reinvest further higher additional provide substantial facilities. industrial sale with modestly will rates. our If us portfolio distribution

or to this quarter in of We third late the fourth this early in quarter close expect the year. transaction

than sale compared the dispositions to potential our this average we when in to favorable and XXXX of expect come dispositions, for rates result a expected overall on cash As X.X% cap better pricing together with very XXXX. other much

of the though potential of other greatly Chemical sale sales, dependent the particularly Overall pricing upon complex. Dow our timing is

XXXX through dispositions depending into We cause the on are push our of mindful also may volume end XXXX XXXX acquisition considerable us to exchange year. of needs the which early certain

$X.XX both than announced Factor and loan guidance earnings the include common to savings penny guidance. better revised increased this company a diluted acquisition adjusted supporting refinancing $X.XX $X.XX per end We share. revised term by to our XXXX we FFO extension. recent anticipated of increase volume range high morning this to low Turning and from

calls, dilution to on stay is and exposure. discussed creating disposition have FFO our our we growth FFO expect short-term previous we strategy muted reducing continue we As office as

as However, that sales. non-core anticipate trend portfolio upwards in AFFO begin to we will associated office decline high with with capital expenditures XXXX assets the our

best-in-class executing We strategy have years. portfolio last we continue made tremendous looking creating our net on excited industrial And ahead, read. lease few the a progress over single to tenant are in

With to that, discuss over investments. turn Brendan to I'll the call

Brendan Mullinix

Thanks, Will.

average rates call. We had to facilities for industrial productive which X.X% Owens warehouse on cap gap BMW had X.X%. a second quarter cash quarter's discussed and Corning included we facilities, of acquired $XXX six last in we million in Purchases

based the refresher, a established center assembly foot property XXX,XXX submarket a only Class that is January. this distribution an company's U.S. a high BMW completed was A Spartanburg near square in facility industrial the Greenville within demand plan. As past The is park of located

rental and strong for annual of square with term lease has X.X-year excellent The in foot escalation. The with labor is XX Corning submarket Dallas force. Interstate to increases XXX,XXX Loop leased is near The access years XX property Southwest Owens five X% located facility annual X%. inner a

as within to XXX,XXX we In two lease properties warehouse portfolio addition Memphis square the to industrial Food XXX,XXX for years, years, company as a portfolios Global foot years. Memphis four and facility a foot for include to delivery two a in for express is and these company Atlanta. properties, company well well approximately property in five Agricultural submarkets purchased located five The logistics facility. leads and global square That

Class top being close park to facilities. We within into highways were intermodal in located are modern major constructed proximity are properties like the utilized tenants. that the recently A built Memphis with newly respective industrial The properties a by same specs and their within and market, box are fully

both there Additionally, a for believe strong future in renewal of the we is probability properties.

bulk transaction approximately Atlanta. distribution of demand one comprised high portfolio from is of second submarkets facilities, in state-of-the-art located two miles The distribution XX another

comprises five years leased first foreign interface modern The built square and feet warehouse was America's a company property for specification. the XXX,XXX to

Second have the for negotiations begun remaining XXX,XXX leased a to current occupancy MARS lease MARS property beyond for square year about term. and term. with totaled Lease feet was CHOCOLATE of continued

recently term and have We've leasing the with in of grown location forecasted. acquired, quality shorter deals real view estate lease specific that of we we for outcomes the future comfortable the have

We've accepted offers we will million of properties properties, industrial third the quarter late or fourth of and anticipate on approximately majority $XXX these XXXX. of close the in

years The average four lease term today. properties year XX for considerably is our of for the longer of weighted weighted years purchase’s average these than lease approximately term

in blend nicely portfolio. So, these will our

in limited number of are includes development the the properties, these to other the opportunities. addition exploration, which In we currently marketplace, speculative investments reviewing

As X.XX% average we've for distribution come competitive XXXX X.X% cap previous investment and somewhere between calls, discussed remains product. on to warehouse for in and pricing we activity expect rates

the I'll over Lara turn now to to discuss call divisions. these

Lara Johnson

Thanks, Brendan.

majority close and new We that asset expect revised earlier. activity continue extends third year. This to to included the the in in on of make this this the to sales still assets quarter of the discussed timing Will non-core the or plan in late good XXXX progress fourth quarter disposition

and mix the million. Five were non-core $XX of included quarter sold second vacant office, buildings industrial assets for consolidated in retail which a

X.X%, average gap Today, $XXX have sold that consolidated assets NOI produced and been respectively. roughly of $X.X annualized cash and Consolidated of of X.X% we've today disposed of assets at million rates cap million

sale quarter one and office of property from during XX subsequently one growth approximately $XXX joint the satisfied non-recourse which we venture, our proceeds combined million debt. Within for sold of million we

Our $X.X share of totaled proceeds, net these sales. from million

freezer XXXX the with of currently preferred guidance accepted market contract our under range We transaction. are The us of in bring plan high-end market. that disposition or or sale million offer, of an to $XXX million, have for either including assets $XXX remaining assets prepared either the being the

office in XXXX close year, the of this of to to sale disposition Lake and deferred Jackson, the our sales Dow in and the XXXX pursue line to quarter Texas, represents potential up this complex complete to a fourth plan we expect effort our could gain. exchanges meaningful Chemical We successful sale still can acquisitions provided percentage later

gains the facility, our the expected of tax Given sale substantial critical. freezer preferred is managing

Dow beyond potential this push result, year-end. a sale As may the

on in front, cases. assets strong extremely the remained pricing better has remain in been demand disposition many We and overall than anticipated had the active for marketplace we

exposure of portfolio on office our value, XX% compared growth At to the basis. overall a difference the book asset one-off XXXX. represented of Post-XXXX, end we quarter remaining approximately of XX% non-core a will at sizable end, disposing continue

That becomes a be said, assets exposure would less manner. portfolio. as our office meaningful the We of to open more expeditious disposing overall in to

update to who will James call an provide leasing. will With that, on over turn I the

James Dudley

Thanks, Lara.

extended had we feet leasing million which square active XXXX another secured totaling activity X our leases quarter We brings volumes X feet. new square in million to almost this or over

increase This well asset new investments the to at in asset XX% almost of increased disposed XX% portfolio first result lease second quarter industrial as primarily overall in sales, online. approximately the quarter. as compared coming quarter end the vacant the specifically Memphis of industrial Our was

industrial NOI a the reason. our vacancy out will meaningfully improve. continue first extensions, office exposure, marking was occupancy down less as Continue the our compared NOI largely rates to Additionally, to rental than X%. profile increases our same NOI negative office is the we when growth reduce Same-store stripping lease same-store quarter expect would for X% same-store second of we to around it quarter and in was function following down market

three generated from the of during renewals rent leases XX, the lease approximating square portfolio June We revenue XX% with XXX,XXX industrial XXXX, feet. escalations. of executed As our is quarter in

On and with October. to industrial lease seven-year Streetsboro, facility was expire our included in the L’Oréal this industrial set side, whose extension a in Ohio

leasing connection with slight decline or and was there are a rent, While in escalations we no the costs pay TI extension in X.X%. annual

in now With a lease agreed good TI as rental given asset location. longer for Automotive to believe rate longer We non-core market lower signed is a a candidate extension this lease for we exchange will XX-year be in we attractive more sale, term. potential Georgia. and with it Additionally, buyers term, to a Livonia,

New side, for positive the sale during A We new outcome a signed office for believe three-year situation Jersey lease the term. will Whippany, in the years, we upon value industrial a in in Duncan, with unique Omnium create we XX our which the Carolina us. resulted quarter extended for with leasing facility lease of help asset. the Plastic On CAE a South

again the the and but had building decided Plastic higher a expired building, needed September than at the in rental the they prior space tenant fully lease in of rate paying year. last XXX,XXX are been Omnium past. They utilizing the in square-foot now that their they `was

regarding currently are them with longer preliminary in lease We term. discussions a

we expirations Our XXXX market either and through office future sale remaining or lease to continue our expiration XXXX have sale, for lease. one industrial been remaining addressed

in building lease of Lewis, our majority beyond central occupies many district or with and to our We a working XXX,XXX for property. square-foot expirations and XXXX office the build tenants. are new negotiations on currently actively Philadelphia discussions begun Morgan have who business decided has of

While out option, will they XXXX. three-year of the moving future, which exercised to lease extend be space current in will renewal they January of their their have our

The be with rate unable the revised through rental rate arbitration mutually a the will pursuant process lease, rental to to if negotiate we agreeable are tenant. an determined

reviewing are value We the the context current options in our of to strategy. property the of potential portfolio maximize our

XXX,XXX of smaller one the in our the tenants who through our They filed rent facility square foot Georgia of pay building Thomson the During Hollander, and stay end in industrial Chapter XX. intend to the quarter, year. currently for occupies

lease marketing FFO de property for or have minimis. overall begun is the sale. The impact We

turn will results. to now I the over Beth, call that, financial will who With discuss

Beth Boulerice

James. Thanks

$XX attributable income company the million share. common net to $XX common per quarter, second or or diluted with $X.XX $X.XX was common Adjusted quarter. per shareholders for share the FFO diluted For

strategy. Our quarter adjusted was payout retain at allowing capital to us ratio company execute XX.X% to long-term our ends, FFO

$XX quarter exploration. expenses This operating non-core the to quarter the for compared revenues of of and recorded of $XX gross both lease of disposition of quarter second million, reduction to of is the million quarter asset results million decline under second the XXXX. We XXXX. first the $XXX quarter mostly and revenues compared in gross second slightly of Property XXXX

the of property for expenses. represented and approximately Tenant reimbursements second million operating XX% $X.X were quarter our

in rental of $X.X G&A in with operations included XXXX. expenses slight a the compared for on tenant the same the were reminder, As decrease to standard. are second quarter, new leasing statement period revenue reimbursements time a the million

$X.X estimated were tenant we always the of lease is G&A expect year range $XX due of and for second and improvement. costs approximately and of for the subject is between This the including $XX of variety remainder the of year. to forecast million factors, in million. costs timing million $XX the the balance to change to Our improvements quarter Leasing million approximately completion the a the

we sheet, balance $XX to and balance the was have restricted end. sheet both at million continue Moving including to and flexibility. of an capacity quarter approximately on the ample cash amount Cash

approximately was quarter net increase our under quarter. subsequently, we find compared and adjusted borrowed first acquisitions. the revolver, During new X.X representing end at an million times to to the $XX EBITDA quarter when Leverage primarily debt

to within As EBITDA. X we comfortable acquisitions to net debt timing fund a leverage range is have sales. fluctuate needed We past, stated depending of to to on likely with leverage in the times asset remain adjusted given borrowings X of the

Our consolidated term with debt billion X.X% weighted of outstanding average average a at rate of years. and approximately with X.X quarter interest ends $X.X a approximately weighted

extended to date our represents end, NOI XXXX our overall portfolio. Subsequent million XXXX. more than the term we from maturity quarter Unencumbered loan XX% of to on $XXX

and obtain Additionally, fixed attractive the the LIBOR X.XX%. rate rate current to of of we swapped portion interest

back call over Will. turn With the that, to I'll

Will Eglin

to I'll the Beth. call. question answer portion conduct will operator the turn the over Thanks, who call of the and now

Operator

Thank you.

begin from of first ISI. go will session. [Operator Please today's question McGrath And ahead, Sheila question-and-answer now Instructions]. the We Evercore comes

Sheila McGrath

on freezer transaction? preferred guess up XX.XX wondering I that in for transaction. you do acquisitions the rate could on And have the the that. disclose already lined if you cap was exchange I

Will Eglin

under pipeline and Sheila. right in quarters what to intent we XXXX between Sure, the that acquisitions the have on and enough of have complete one three about rates and cap Exchange. four now, letter we The contract

Sheila McGrath

push Chemical the right? Okay, but that is out large still you further, have might Texas, that to Dow

Will Eglin

in created the you mean, XXXX use a for I the pipeline lot exchange. acquisitions preferred question, a that Yes, of that's obviously to sale, need the know,

the for around just lined make a sure want up is we we we to have before So, Dow it's item, the complete exchange question properties gating that sale.

Sheila McGrath

forward exposure? a they remaining all Okay, is acquisitions, lease great. going you increase to shorter seem that as should And have expect industrial we then the than that continue to on something term Lexington, typical term, for the

Will Eglin

term towards If of weighted coming. years were -- comments average where on have we Brendan's Not necessarily. pipeline, lease oriented XX to the close what's

six in invest that shorter the it all we the to that on not more versus across end be the of longer, change year, opportunity but durations, the in a months asset it's first happened the class So, to strategy. tended specific just there be during

Sheila McGrath

into Will kind Okay, and XXXX? you magnitude? will you perspective Is one numbers, of put that some more XXXX, mentioned on cut CapEx, in in just that expect XXXX. there of you meaningfully is decline could in versus Or that way in any that sort it half

Beth Boulerice

Sheila, does going off Beth. Yes, definitely portfolio that after year Hi, CapEx. to our high have it's which of down most this we're sell come command as office we

we're modeling So, for and about next somewhere range to for know, to year those. $XX million you million $XX looking the

Sheila McGrath

perfect, you. Okay, thank

Operator

of ahead. next from And Mailman Craig Capital our today comes KeyBanc question Please go Markets.

Craig Mailman

other into just kind it's, into. Maybe close guys morning. good jumping industrial know, not and you redeploying of picture more markets bigger necessarily to the Hey, you guys are are industrial

you it mix tenant are markets. know; in of you curious types guys these going really Just after

think you I and portfolio. going you the any and retail issues just just about exposed like fair, guys all now, store, also, right know, at department the you're a also little Could about to talk with mark the your war you exposure? on health of agriculture the given whether are And trade curious, feel of X%

Brendan Mullinix

Sure, is Brendan, this a Craig.

our In terms tenant of mix.

demand logistics I because diverse we you look pretty tenancy, at just being very we our see industries. of across have drivers if a you across range the strong think transactions, recent if going

retail that terms have from specific exposure sector. I retail of would In moment, the say concerns the don't any we concerns, at

Will Eglin

secondary markets to the both what points higher rates basis And of cap coastal invest markets, markets. in than might in we XXX generally, points see XXX are primary in you terms Craig, where and basis

private industrial in, for think versus essentially of IRR that We're REITs investing markets little other of rent the while streams then We underwriting strategy. are by rent certainty more some for, or income-oriented investors. an in or bit you have know, less two invest X%. the you efficient underwriting than from markets we that that do desired growth we're more We than of a are the, competitive know,

Craig Mailman

on the Thanks term? I'll guys to you get for think kind time a you're going renewal kind Plastic mark about you because just that. mark that to market and talk longer market what of have maybe you get And then to negotiation, on sensitive on of that do and What but Omnium. short-term

Will Eglin

You know, slight if would know, you be, a a reduction there is minimal reduction. very

I think building its the them. very the into functional of majority going be to something making that's for

recession So, related it'd railroad be rental TI adjustment more of versus a a adjustment,

Craig Mailman

assume know, XXX. like guys CapEx? obviously, look well-located safe it a office exposure, just just it a And to zero that'd Is to Zero be you that's you building, rent minimize on free but as then renewal. are refresher your of the now? needs or redevelopment do does option that? mean, in that Kind the you till you Or, end sense of it make sell to now you there. pretty it shorter-term I dream big know, have hold place. the And

Will Eglin

And first was the non-CapEx this is, answer options. To exercised it's recently. question the yes, very is, our know we're I evaluating second renewal.

different looking of options we're into for the facility. size all So, the

Craig Mailman

pretty last math And trajectory arrear redeploy. about, and dilution, at you there then how work? timing, as you I know, guys you is your sell you can consensus, to look slight kind you all know, guidance, at you if still know, dilution I but looks one, of comment assets, flattish. haven't mean, of it should the you given just just continue XXXX

Brendan Mullinix

dilution there to is numbers Well, be But from more sale that grow the AFFO think the next we our start year. FFO process. will expectation that

you're know, right. you So,

they're guidance, this portfolio. there FFO, given in trading is but from know, haven't you We ahead delusion

Craig Mailman

you. thank Great,

Operator

question today Guinee And go the Please comes of ahead. next Stifel. John from today

John Guinee

Should at to a stabilized? we Is great, a sense a and job. for that net-debt-to-EBITDA. stabilize acquisitions how get of to business dispositions number get other? the is we nice offset sense you a each should running fixed-point good where Great, In think a for order

Will Eglin

I we're with very think point that leverage that view we're the putting portfolio together. in at comfortable of

run that it's but You know, that doesn't be. certainly leverage will very high, us necessarily to comfortable mean that our point for leverage

John Guinee

you expansion how deal of going Don't building? on sale costs the Then freezer I said, million. there million is you acquisition was initial you of held $XXX for assets $XXX sell on the an think your freezer much the you have And before said it?

Will Eglin

funding expansion have transactional know closed we're We at before an we point. be that expansion. the not this essentially, that it

for in So, held the sale terms of number...

Beth Boulerice

sale for XX% of John. It's held the about number,

John Guinee

held for assets? in else miscellaneous the What number? is sale office Just

Beth Boulerice

and in it. Yes, the in or you if supplement total sale represent. And six at chart, held we property seven assets have see for the they in assets look the which you'll

John Guinee

Okay, million. great. assets XX operating then situations many talked maybe on ground your liability by but operating you this are an Does you to lease liability? lease assets? And about already, And pertain that affected about how of have lease particular

Beth Boulerice

-- It's what leases. exactly is. that our that's Yes, we have is It lease. also leases office we And it it also eight about ground ground affects. have our

We mainly York Dallas, are leases. have in New of ground also and it's part our as lease office well. that in that's But here a

John Guinee

one think you're One the the building, in way, renovation going I By is -- pen. how pen

Beth Boulerice

Great.

far. So

John Guinee

pay more They rent, going Lexington say Will? $XX is everybody's more to pay going rent, to $XX

Will Eglin

through options we'll have our see are. then we Well, goes least And at XXXX. that what

John Guinee

Thanks Great. lot. a

Operator

go Jon today Jefferies. next comes with our And ahead. Petersen Please from

Jon Petersen

little cash more rolled basis. XX%. you on a industrial the Great, get did thanks. Hoping we Automotive a down quarter, Those kind by and about rents detail weighted TI couple average of renewals L’Oréal this could on

our rents I what down unique hold properties? circumstances kind we're industrial of seeing So, are that guess the

Will Eglin

which got it, of with Yes, no is loader. And part was there commissions, market bulk We it’s Cleveland just associated also costs front a no large as no as a capital L’Oréal for it. warehouse, term, property far years seven of sur. TI's. the

facility border and more is for term South manufacturing bit TI the rent Carolina they addition and costs a paying of those reflected little on tanks Auto a on the it’s of unique seven-year in So, Georgia. that's and not gas where the manufactured specialized to location of

that doesn't the term at comments, we assets the because of kind and I think we stated So, to it important dispose was location criteria rent than more maintaining we now the have the meet and of said being a will as those different we market. factors thought look regular in those

Jon Petersen

guys office by you talk out. growing? X% how it by and different same Are some then portfolio portfolios and breakout and the two And waived idea store are give the about office and growth move year being same-store close on to us like to industrial you was able an negatives

Beth Boulerice

break We the as our are but by properties to store of more currently range. same in out X% currently bring most don’t industrial type them on escalation having X%

through that will we we our into and grow. store around anticipate redeployment So, turn once our get office same industrial,

Jon Petersen

bucket pool. for are they are, in properties sale held the still If your same-store

Beth Boulerice

Yes.

Jon Petersen

maybe call then then are with and a high also the just how people in just change trade what since about we've the Okay wars more earnings the seen of last rates. know curious level, of from interest terms and you lot thinking economy

for So, ability properties office that sell impacting you office are the how your or appetite properties is to sell? there to out trying

Lara Johnson

seen multitenant standpoint. is in and number this now out an are term, in those growing occupancy improving one there. the really appetite branch, and in only another that We energy haven't we Texas seen which leased from fortunately market case a is Texas for Houston, quarter buildings In Lara. impact in a farmers with with we out fully where increases in we Hi, of are some are dramatic really with properties

hope this So, reduction from longer-term at effects in interest we're we haven't benefit stuff. although point to the the rates as selling seen we

Jon Petersen

you. Thank

Operator

Please next from our John question today And comes Ladenburg ahead. of go Thalmann. Massocca

John Massocca

in and is the what this on Indianapolis but [ph] then James' sale comments, of LEX I’m missed also maybe sorry if lease made I property being or property. progress office

Lara Johnson

working we're to on the lease John property simultaneous Indianapolis Lara. with is that Sure. we toward where do This expiration. out property [ph] on that moving office an is and have offer sale Actually, so

Will Eglin

working And have we expect that with And progress on long-term early to the a order. in short executed subtenant. extension in we're that’s

John Massocca

about the And one properties industrial how side? on mission

Will Eglin

both. facility in a There we're to and -- short-term both properties building they're [ph] that extension Greer get is on close X.X going a of to previously into. decent consolidate million from that going are noted to Michigan We these getting finalizing square-foot they there

for We heavy few have and have facility then one really leasing working well tenant and quite as hot several through a and the process prospects perspectives just Lawrence prospective the and we're we there. Moody's,

John Massocca

look industrial releasing, speaking, rent on of then XXXX list maybe movement expect as the stands we what potential how expirations curious the longer-term well up And or if just anything or kind renewal cash on into generally can above below maybe being in that market? out

Will Eglin

office The in being which on that to currently or the stable to only going than should in end be close the direction should standout down, that see that to that has really and peer it's up I converted as is components XXXX asset fours to $X market in going be up. everything potentially to marked because and it going that industrial above is were other other got the rate going think that somewhere I don’t

John Massocca

That's me. Thank for Okay. it you very much.

Will Eglin

you. Thank

Operator

next Nick Please of our ahead. question And today JPMorgan. go [ph] comes from

Unidentified Analyst

or if think you past said, be to be by remember still to you you above, Is the in Do goal? I -- about morning. XXXX? that year-end industrial want I XX% the still expect at Good of correctly

Will Eglin

each case in a XX% the I directionally, the realistic year. think this toward in XXX% moving portfolio. this because we goal. transaction industrial big But construct, And as thinking transaction in and as office. can closed question fast year the its that's will Dow of there The we're a office large maximizing that's value go a context while is surveyed next industrial

Unidentified Analyst

basically previous mark-to-market months XX as industrial now go just the effectively. So, entire XX your the now question, to to entire But to the Where Where portfolio stand does that next fully you basically look within exploration. XXXX portfolio? have at market, to if the were in transition a your you industrial portfolio. to

Will Eglin

some some to portfolio, of stabilize grow. remaining the is And term that rents how in just quality, portfolio on tenants, still have out then manufacturing with have of or we kind where XX% rents the industrial we're there's that is kind probably just estimate, I it properties lease the negotiation of to expecting throw think goes entire to to older of them an depend the number. going on that have newer

kind would that's So down. how estimate breaking I it of

Unidentified Analyst

dispositions tenant remainder year. the for acquisitions of on And the of and

So, little of of you've specificity I mentioned numbers just want bit give before. a to

You for to said you're under right sale million now $XXX that for [indiscernible]? is buy contract

Beth Boulerice

contract property or on sales about million. under offers accepted of We're have $XXX

Unidentified Analyst

So, you $XXX might so preferred rate? and year-end, between the sell, right freezer now includes that million

Beth Boulerice

that's offer. the number with accepted the an under It or contract does while include and preferred freezer

to either also that in of are to We short execute we on order. market take market additional now in sales hope or properties the to plan

Unidentified Analyst

it much Dow is how this And be to rough in Chemical year? terms roughly if executed were

Will Eglin

Well, process. update we're in unfolds. have negotiation we really -- that any want to prejudice as don't we marketing We'll the you process

Unidentified Analyst

Got it. And in now? have how much contract to right buy do you

Brendan Mullinix

We some $XXX offer have accepted million.

Unidentified Analyst

XXX, got it.

you. Okay. That's it. Thank

Will Eglin

you. Thank

Operator

go And from ISI. Sheila Please our next Evercore McGrath question today comes of ahead.

Sheila McGrath

Yes.

Whippany the On transaction.

was a and roll a detail on -- positive think that is? little rent in that for I give us down CapEx plan Is it sale? that was currently a outcome for office if for what marketed suburban New asset Jersey. your you Could being more

Will Eglin

that the -- at from were prepayment is current Yes, going balance it on is to XX.XX, expended going TI the which be XX.XX so down to went there a $XX to triple net, got the It's rent that the of go has definitely or has and a in from end a were penalty. get term on list. it,

the evaluating not to sense we're wait until of forward maturity move now the it or debt. whether or makes So,

Sheila McGrath

sales we venture? Okay, of great. electronics And that regular should your on expect joint to And the out joint Was outcome for venture. a arrow of then that pricing? out good JV continue disposition on

Beth Boulerice

I of as we think venture. select exists. we to will opportunity and assets on we for I our expected think it outcome good that venture where joint make trade a a that the with decide together It one-off joint the basis. was was line right partner is in dispositions And out

end are there after another couple a So, asset potentially the [indiscernible] in in others, of quarter. And the sale, saw just of addition to we the the pipeline.

Sheila McGrath

Okay. you. Thank

Operator

last our of And Please John question is follow-up go Guinee from Stifel. a ahead.

John Guinee

with Overland total there in how of either income debt million. XX on Kansas Is balance And think sheet? Park debt associated around and the any debt about the your The Charleston we default assets? should great. Okay, those asset

Beth Boulerice

balance Overland year. stay of remainder Park will asset John, the the our on the probably sheet for

maybe We be third that end off the are the by hopeful the Charleston of will quarter balance our sheet.

John Guinee

both are the NOI on now? and those drag the But of right vacant assets

Beth Boulerice

vacant. Park vacant. Overland Charleston asset The is the mostly is Yes, asset

asset, do asset for currently Overland the some that the Park operating responsibilities and we asset. have expense Charleston So

server for that expenses. a decreasing be that so the asset operating those have We in should on place

John Guinee

Great, thank you.

Operator

management conference question-and-answer to the the team includes session, the remarks. This turn back over to our I'd like for final

Will Eglin

joining Please of if all any morning. or management Thanks in members our Heather materials. Gentry like again our other website or to as our visit to you questions. for this me and with always, great of have may day. you senior contact us a And quarterly the team you contact Thanks addition, receive would

Operator

Thank you, you attending for presentation. all We thank today's sir.

lines may your and a day. have You now disconnect wonderful

LXP Industrial Trust (LXP) 7 Aug 192019 Q2 Earnings call transcript