Regency Centers (REG) 31 Oct 192019 Q3 Earnings call transcript

Company Profile

Participants

Laura Clark	SVP, Capital Markets
Hap Stein	Chairman and Chief Executive Officer
Lisa Palmer	President and Chief Financial Officer
Jim Thompson	EVP, Operations
Mac Chandler	EVP, Investments
Mike Mas	Managing Director of Finance
Greg McGinniss	Scotiabank
Christy McElroy	Citigroup
Rich Hill	Morgan Stanley
Craig Schmidt	Bank of America Merrill Lynch
Shivani Sood	Deutsche Bank
Jeremy Metz	BMO Capital Markets
Samir Khanal	Evercore
Wes Golladay	RBC Capital Markets
Vince Tibone	Green Street Advisors
Michael Mueller	JP Morgan
Linda Tsai	Jefferies

Call transcript

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Operator

Greetings, and welcome to Regency Centers Corporation Third Quarter 2019 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded.

It is now my pleasure to turn the conference over to your host, Laura Clark, Senior Vice President of Capital Markets.

you. Thank

begin. may You

Laura Clark

welcome third and conference XXXX call. to morning, quarter Regency's earnings Good

are Chairman Chandler, Stein, Palmer, me Treasurer. Officer; Hap Joining today SVP Leavitt, our Jim Chief Mas, and Financial and Chris Officer; President; Chief and Officer; Investment Mac Chief Thompson, Operating Mike Lisa CEO;

filings On refer expressed outcomes results the statements may and could with risks today's differ discuss to in uncertainties. important and materially that forward-looking those Such we statements. may those statements. forward-looking to contained results Please statements. Actual our call, from identify factors which forward-looking involve future from SEC, the differ performance, in risk actual cause

will be of release Investor our We provided earnings non-GAAP to found We Relations financial website. measures measures. a these which supplement, on in reference and reconciliation our can also their certain financial measures comparable GAAP

Hap, over our pages like the to highlight turning disclosure. redevelopment supplemental I Before and for within updates would development call to

guidance to included additional as NOI have We we stabilization, coming as for offline, commencement position expectations enhanced information for well for start. as an effort initial rent projects and pipeline provide around in timing

hope Hap? you useful. will We find this

Hap Stein

morning, Laura. everyone. Thanks, Good

of provide and pleased with evolve, retailers multiple leasing our are and experiencing and shoppers combination on the continues experience. service activity focused convenience, across of physical remain We tenant that healthy the as high-quality demand categories. pipeline locations environment with retail and The are to grocers of of importance best

top country. neighborhoods and in enable with surrounding to places in retailers shopping Regency the for connect the will centers to that make driving markets remain relevant decisions our right the will the across communities outstanding

larger a by believe team focused addressing redevelopments. As on you'll of with atypical short-term is headwinds, of intensely what driven is confluence timing together bankruptcies from the the hear we rare Lisa,

of Regency's earnings and the dividend capabilities cash flow anchored located and cost-effective favorable the know that our leaders by a our redevelopments free of high experienced fluid developments on that and portfolio after basis, and the centers to be grocers her and return our trade redevelopment include, deep dense and extremely among an industry-leading, social strong environmental, governance will share and our funds advantages, soon across that sector and supported which Regency's performing with and top areas; in total development strategic practices. sheet; growth should dividends high-quality balance and to markets team exceptional will combination by that commitment community I confidence shopping to country capitals and located we core returns in neighborhood pipeline; You

Before turning we Executive as seamlessly Chairman moved on the last January is Plan when to Lisa you to call that CEO, the into I I of become announced to Lisa, happy Xst. CFO progressing well. Succession Mike that is prepared be know, role fully over quarter Regency's and has am the report Executive

am I will continue team. progress talented Regency under good and from Lisa? our journey great to to on our extremely Lisa confident that

Lisa Palmer

excited of alongside of work Board I I to you, Thank with you exceptional lead looking that am have Regency. want with Directors good reiterate and forward I to the and how continuing me Regency's opportunity and you about team. and honored Hap, everyone. to entrusted morning, rest the am I am to our

which off high-end guidance around call provide X%, XXXX our is the the taking the XXXX comments some NOI I to has been will table. updated on First guidance. today, same-property

of year X% X.X%. we last did range You stated the finish to to of low-end previous may our at recall, expect that we quarter, the

half leasing growth bankruptcy strategic redevelopment, and contribution I our a timing related first to will objective year. and muted of being our that from remind to And the contributed including Kmart, the to NOI the a few this specifically around you factors impacts have Sears move-outs same-property in below

to spite it the high-end growth to our notable In expect come core X% earnings we that operating of in at these range. of X% headwinds, is XXXX

XXXX, release. full to earnings ahead we Looking will provide our fourth year with guidance quarter

preview we set our of expectations. an growth consider be of Due XXXX a However, positive. NOI operating to slightly unique in what is be we currently want to circumstances, core to share and XXXX flat expected to to initial earnings same-property

This couple temporary by primarily being a factors. dip in driven growth is of

Dress including impact elevated basis additional a Barney's, move such an First, and as impact Pier from for known potential X. plus from IPIC, XX just Barn tenants and outs bankruptcies

contribution were the will general And positive offline million estimated proactively well year starts timing NOI of offsetting projects and we $X an taking be as redevelopments that of and completing, that are second, in-process planned from the next just for as deliveries.

to do in we result of driven our X% return earnings XXXX. the from range of growth more that NOI key growth impact We conviction believe a XXXX, plus bankruptcies X% have Barney's a that will a by components. we return largely elevated to normalized number will and Beyond unique

its consistent will cognizant and are the experience store to rationalization. exposure in portfolio, team our lower we top have our properties but challenges, relatively confidence, past, with our forward, environment evolving retail going of the the and of me well-located While notch and quality give Regency

is occupancy In me in shops. evidenced in anchors the upside addition, for for healthy we paying as both tenant rent and continue leasing see by further our to and pipelines potential active giving full demand confidence

annual growth steps, X% translates the also a achieve additional growth. approximate a X% to to portfolio. of points embedded XXX rents translating the in to across continue in to an build points range We basis Growing basis XXX rent of

good that in objective visibility are making growth our support in-process great redevelopment same-property X% future. We on contributions the we our progress will and projects to have

million Westwood that our to bit. including about Mac NOIs a projects is name over of incremental specifically next eight Common, and a talk to pipeline identified positioned years, from generate five just few will Abbot, fact, Serramonte approximately the Market In the $XX and

should into time, approximately complex XX value-creating from And growth, even as contributions basis of of we these Over uneven these with contribution. these muted points will and that prepare redevelopments projects. translate will while start the be contribution two years times, positive at average redevelopments for more a

strategy blocking tackling Jim? return and remains and executing Lastly, total importantly, Regency returns. focused sector-leading perhaps keenly and our to to most our enable on to team

Jim Thompson

Lisa. new met executed I growth our NOI the leasing that quarters. team X.X%. report shop most quarter expectations QX, at the happy am Thanks, in Same-property third for to nearly eleven

We continue to leases, our contractual X.X%. of into steps average leasing, of include annual steps rent our as have success by embedding XX% nearly new evidenced shop

in This move-outs in this the earlier to the and translates paying the momentum strong At NOI leasing lower to pipeline, straight-line we same year, discussed expect the rent spreads first half caused Due and same-property the positive of decline into of for XXXX. XX%. year we turn, of robust time, the timing as occupancy leasing continue. rent growth in

are as like we list working potential of where watch have rent. well focused In backfills diligently tenants regards basis Theater monitoring we with base retailers and for existing as locations and Dressbarn to IPIC on annual our fallout, and Pier including locations, points future tenant XX vacancies XX X, representing

a business back-filling merchandising mix and part are these discerningly not the often higher of Foreclosures our and rents. spaces, at than teams are more upgrading the

an reason that XXXX our the portfolio of indicated, Lisa importantly, as uniqueness the have the events More every is of and confluence anomaly. in to given impact Barney's believe elevated we in

for is flat of that get the in that driver back location the one remains is fluid, the growth expectations. we open it's and in at to the when location now, to our Barney's regards status of remains year-end Manhattan, a situation In our likely Chelsea significant space while store XXXX

capital rent good the the at this We we although and prospects for requirement. location, and pursuing replacing downtime certainly feel evaluating and are about alternative this would redevelopment with plans high-quality come

important decisions, to mind which portfolio. long-term success. It's highly future we sets for that in center proactive continue on remain making focused and across up the our merchandising Mac? asset to execute keep on management astute repositioning centers We

Mac Chandler

Jim. Thanks,

and significant over Our $X.XX and are we strategic redevelopment billion value-add the objective starting development the five meet opportunities in developments remain well-positioned to next and redevelopments years. of

As capitalize areas retail is on dense for on well, changing and focus evolves, operating trade development horizontal premier and and opportunities estate redevelopment our nature vertical affluent centers mixed-use positions the as us shopping increasing infill owning projects. in well to real of and

to keep scale it's long-term. discussed, Lisa current of are component many uses. of projects our achieve are same-property key over a As often and to that pipeline more, for But complex, larger in Regency mind the near-term X% redevelopments in mix important and a growth include

longer will typically they take and to But offline. require These complete add substantial and stabilized, to portfolio. NOI our come projects NOI to these projects often value incremental once

near-term some our Common of to With and former in-process our projects. Virginia larger at fourth that, quarter Market office I'd of Redevelopment the redevelopment started XXXX. in building in of updates Arlington, provide on like

in was a vacant As retail. this the adjacent when it reminder, building purchased outdated we

will office mixed-use The the and is progressing building. configuring be by building building three-story out entails topped year-end. a redevelopment into weather Construction essentially four-story new and typed is smoothly. retail The

least execute office We exceptional The luxury in are an our of XXXX features views at for anticipate X%. Fitness operator prospective with incremental appealing with quarter estimated and in to the yield the tenants very nearly second coming tenants. online a of National begin Cathedral leading

started with prepared nicely, and first offline is of located in coming property being building. quarter. The a redevelopment Abbot the NOI Construction complete entire this in footings particularly Harvard is the progressing demo year now Square ground-up the for million $X.X are

X% concepts is to estimate and begin XXXX positive we We fitness with an and estimated are in occupancy incremental yield. best-in-class negotiations activity at retailers, in Leasing several initial restaurants.

Moving over components on expect some of year-end. pipeline three commence next at San of now be to Serramonte This the next we our several to phases our located the staggered projects, years. of Center redevelopment near-term by Francisco, will consists that south of

Fitness. the as The is a new of Crunch well first new hotel successful XX-screen lease, XXX-room our outparcel relocation a and project restaurants ground several as theater, development state-of-the-art of

now square next supporting next a part and in-line new new retail to second look interior mall, entrances. announcing concepts, paving start well the foot the $XXX The for we several projects year. exterior which which the project will the projects quarter. in increase productive of foot of way our of as average Both due are traffic, to is as tenants, the forward per Both renovation

of box, is from the anticipated including JCPenney former well Interstate space up XXX. variety tremendous of component third specialty which sets XX,XXX in from This Groundbreaking for grocer. The a visibility benefits is foot XXXX. the junior square redevelopment anchors, a

It units giant will by Westwood Maryland poorly to XX new living Center converting apartments, plan another XXX is Shopping include center XXX be center town a early we mixed a and vibrant configured multi-family vertical in XXXX. sale large-scale into assisted retail anchored homes. to Bethesda giant of a that start redevelopment anchored in approximately

we ground years the strategy, shall open retail Phase few with best-in-class X should retail floor a components. partnering the XXXX, at X with in Consistent open co-developers Phase are non-retail our The and for apartments thereafter.

updates regular projects on projects some and and exciting are earnings These pipeline other supplemental future and in we significant these provide our calls of in disclosure. just near-term our Mike? our will on

Mike Mas

you, Thank Mac.

Let me around FFO begin with NAREIT results earnings XXXX third some our updated additional quarter color and guidance.

from FFO combination positive items. includes per quarter a $X.XX a NAREIT Third share net of impact one-time

First, second, bond offering. of terminate below our repayment August breakage term market at $X.XX a $X.XX from charge rent Serramonte. share amortization the lease a negative swap share agreement per offset non-cash loan of benefit associated our by positive accelerated a with JCPenney our to with the following proactively per impact And an in from triggered

this rent QX, termination $X which in the recognize new agreement, below Therefore, below at out and of will date. in another in termination of recognized to market will their rent this JC ratably million million in another market million move us May amortize $X QX of the addition requires the to $X Under yet Penney we end year, XXXX, XXXX. through

earnings ability Our operating guidance core we to has why XXXX like been to impacts. eliminates dividend. these to the Items of better grow these earnings performance FFO and a updated our provide non-cash reflecting as more reminder cash closely as it certain metric non-recurring a use items good reflect NAREIT measure and

As Lisa that XXXX, core X% our are growth the to of mentioned, of range. operating range and near we for top confirming expect X% earnings finish to

and allocation first highlight business one the differentiating Before capabilities. our me aspects important wrapping of plan, call, our the most funding let capital of up

have positive rating both annually, redevelopments outlook to generating are now funding approximately are developments and basis. cash a our million S&P flow access and we funds $XXX a hold which We leverage-neutral and many of to on fortunate options attractive Moody's. by free And

the superior are end, prospects. quarter acquisition acquired compelling growth this assets with several attractive sources capital we objective portfolio, of and and be of quality into non-strategic the NOI our shopping two able fortifying that take lower given can and addition, centers capital. growth our advantage that to sale growth of we we same-property In opportunistic X% through the assets of deploying of To

In Pruneyard August, We these we funding, million $XXX the a X.XX%. portion unsecured rate our Regency proceeds to million loan $XXX term issued with interest record $XXX used acquisition. million notes at repay of a XX-year partially of of the balance low

this incorporates Our growth earnings sale funding the leverage-neutral guidance and disposition assets the on lower of a acquisition remainder basis. of tax-efficient through

Long our In selling on September, funding debt executed ATM program partnership secured basis. playbook. acquisition And located we on is Beach, gross proceeds combination yet funded the California, units, in of through forward in source million in Circle Marina our which another September, and a we lastly, approximately a in $XXX operating

grow As and opportunities. the and development Mac to our we about are pipeline near-term discussed excited value-add redevelopment continues

in free will expect and forward be leveraged We development XXXX portion to that proceeds a spend. our ATM cash used exceed fund flow and the to from redevelopment spend of

sheet and correctly it when compared source funding when maintains balance strength sales. property our compelling a is priced This diluted to as

flexible being including to and meet over objectives X%, earnings over same-property of redevelopments dividend with that returns strategic is one the strategy value-add to growth X%. plus, five $X.XX developments exceeding billion well-positioned next Our X% and long-term, the total growth core many growth, of factors funding years, our Regency of NOI averaging the in contributes starting

to I'll for remarks. turn call Hap closing back the

Hap Stein

my phone Thank This team with throughout the with amazing that the worked last to but you and you, I'd includes community team with on all the thank of have be able take Regency the talented the Mike. over like also years, members, at only not call thank members I opportunity are whom the I my who will today people to this on investment interacted in all XX last us to upcoming to meet of with NAREIT. many that earnings career. with I've

all Our successfully truly to is with team, made stepping Lisa achieve to company to been have as to they you constructive awesome honor pleasure into lead and new am goals. my special all success. to where – exceptional supporting my Executive Chairman, an contribution has work forward Regency's dialogs today. a I our this Regency's role looking it and as It

we That concludes welcome our questions. remarks your and prepared now

Operator

conducting we'll question from session. first Instructions] question. Please Thank Nick you. [Operator with Scotiabank. Yulico time, this At comes with a Our question-and-answer proceed be your

Greg McGinniss

This morning. with Greg Nick. good Hey, on is

Just from one question today. me

on what You to committed am NOI the expected timing achieving that growth X% goal? seem this I the same-store wondering over long-term. is But

I there same-store be if misunderstanding growth because nearly I if XXXX, and growth Or in to the zero just mean number, Does am guess, the growth in assuming XXXX we assume low-single then from that and out? X% XXXX. should we X%

Lisa Palmer

Greg, Hey, Lisa. it's

your Just all our it guidance to will quarter we fourth be getting call. answer full on question, components the of for earnings XXXX,

guidance. And time are so, not this giving XXXX at we

going are XXXX not going We or certainly certainly our XXXX into not we toes to are to XXXX. or dip –

long-term. over we call can do I what objectives will that do reiterate tell said that, on is return what the and achieving But that confidence strategic have our you just the I to we

lot value progress in will little redevelopment projects in and visibility take harvested, those they will a to timelines, have the our – that some are a pipeline, of that already We of bit value-creating time. be great

this talking even to projects. were we first some the is that is just amount time interestingly, highly anchor today, retenanting correlated creation about of these taking to it's our boxes, of the And complete also value earlier

And sheet. our team. we balance I love our love development our We We So, love platform. portfolio. our love

are all developer We really are shopping think They excited – a owner, well about positioned to me, of may be not sector-leading to really and we future. love but continue centers. we the operator,

Greg McGinniss

that like X% expected clarify, to average be just growth? year, over of the kind period, is not five you'll But a growth X% thanks. achieving year necessarily so per Okay, that's an

Lisa Palmer

of a the believe is were over I X% long-term. had me. now an long-term. we down that don't for of with year right north our average the have I exact five over and is I number that it years It's write me. know may It that average we But several X.X% X%. Laura

achievable. So, believe I it's do

Greg McGinniss

Okay, great. Thank you.

Hap Stein

Thanks, Greg.

Operator

comes question. Citi. with Please question McElroy proceed Christy next with Our your from

Christy McElroy

Hey, good guys. morning

contribution? on the be appreciate XXXX, kind on expected or larger expectation up a of the And each negative following detail to is that neutral Just flat projects. for growth redevelopment of

on Serramonte, purposes, offline expectations space for you two next any update for if modeling the space comes impact of us Costa wondering, – But those sort Westwood, as Verde FFO over years? could that downtime

Mike Mas

to specific it's our Christy, the Mike. the for when question With come respect impact to Hey, more next much XXXX on quarter put details. and redevelopments we

offline of did million at coming specific refining talking plans. are We alluded those. we through next still two projects NOI some Mac But our year $X spent and time to

downtime. in has it's visibility you XX working trying step little to to point our of into timing so impacts to bit our NOI that Mac great to think when new And little Page return start disclosure, through, team job a for to question, a supplement. to took also will would the then Greg's through. or these I bit a The of more provide projects importantly, done I time more some around are we and

Going outs. projects, forward, with contributions. ins to it's calls XX basis to anywhere will descriptive we will on quarterly points continue basis and would the we be the points – – these to averaged from understand everyone I we've and say that this, between of positive and help meetings in these very be the very about very, XXX on sure

XXXX Obviously to in point XXXX anticipate XXXX. would muted. been like we has lot a I say time And look this that at

Christy McElroy

Are of here will acquisitions? of issuance? been equity a ATM kind spend. that terms kind all balance of for terms dispositions you kind XXXX? equity seller do a source or in of of mentioned has about of additional sort it prefunded you the the versus of think capital to Okay. of of the Thanks, raise, portion forward going Mike. that how redevelopment go in And Is And then, you just to

Mike Mas

fair. Sure. free as our payout all a good with It's low $XXX ratio. are cash free question, flow generating cash flow. about talked million And a given and starts we've It we

Importantly that's after CapEx, that's after dividend payments.

plan and that then, us cash flow neutral And active developments a our are next leading look leverage more of to into for provide. this year bit capital free that a to will we pipeline building and capital is than we redevelopments raise little again need

So or we beyond any year per we assess and we look to at pruning need activate our our X% typical whether so. portfolio

We respect And when with like NAV a science. price our an looked at is we capital this the not plan. price, art, to

if implied and cap consensus you our be you redevelopments about may returns. that rate if you proceeds NAV maybe averaging think, of think – X% developments about what use about I and and think into

We like that trade and plan. that's think how capital about our we managing

balance well. Importantly, X.X We S&P. like the at our that that sheet committed we with of positive we as both like are sheet. times. are Moody's and preserve closed And balance maintaining We work the on strength outlooks will our to quarter We ratings. we the to

Christy McElroy

Thank you.

Hap Stein

Christy. Thanks,

Operator

next Rich Morgan question Stanley. comes question. Our from with your with Please Hill proceed

Richard Hill

you what about this morning, Lisa, know with just confluence good now first you you, the your anything maybe for redevelopments guys. bankruptcies? Hey, strategically, given of changed would

Lisa Palmer

Absolutely Mac others. call that touched now And them why even we these. hopefully even are the think, some disclosure have that some had and well can see on see actually and projects. about opportunity. talking we we And enhanced you have some some about I not. of that on really you an These And excited great are of as can you

Country. some have visit you to like Town an Some had of others even these and of opportunity or

in an opportunity to going are Atlanta. We have

a a – for creation there So this focused on sprint shareholders. it's a exciting our long-term projects. value are really we lot and is of And it's is not marathon, a

Richard Hill

reassuring. helpful the weighing not have get growth? flat And That's you're versus on is are us we know mix guidance is of I between, give the had how to bankruptcies redevelopment out the very follow-up the lot now. do looking confluence and a I the to call trying think maybe it. I much a Got right on question. of

redevelopment? of and we think should is sense How any XX% the bankruptcies XX% about mix? have you Do that of, it

Mike Mas

you potentially the impact. of. lot since but talk out You're obviously. points this come some between basis all about From a perspective, be of are a – of facts can’t bankruptcy today, should XX going more that let's to XXXX, aware but averaged we Rich, hear and we've there XX to and

that's think about two you were just just up unique year, next IPIC, and Barney's in bankruptcies tenants. If that XX basis against alone the points as

regular So, that's what far call business. way exceeding we would

So I as in for keep the think through that you impacts XXXX. think mind

think of is. another redevelopment it will It's ins which of contribution I like XXXX. muted lot the given what the year contribution, outs look a and year is of another NOI,

Richard Hill

the it. from our for That's one-by-one. on assets helpful it for really me. perspective. the you Got disclosure That's Thank

Hap Stein

Thanks, Rich.

Operator

Craig Our next with of Please Bank question with Schmidt comes question. proceed from America. your

Craig Schmidt

Yes.

open how to paying small the shops, many to take and you a it on roughly about rent? months that average, closed thinking from does Just, store go one is

Mike Mas

Craig, the to I probably eight say closer lease But I think four. execution I say we in month from is would – range. must to will probably RCD

Craig Schmidt

Okay. That's modifications XXXX? in helpful. And then, will you be doing any lease

Lisa Palmer

In what sense, Greg?

Craig Schmidt

closing, – may in negotiate fearing store to rents you lower keep you place. Where to them

Lisa Palmer

I rent I releases. the reduction, about would – rent think

Mike Mas

situation on every own. Every own. We deal on stands its obviously take its

them and can appropriate would we get in that tick renewal saw retailers. you placed one I'd slight effectively of a them had was backfilled. are the standing quarter, on reasons Keeping call, we downturn deals until We couple a still rates I we of particular had this the suggest

keep basis And hit a of a you the the space market on bit while filled a space. you may to take little short-term

tenant been get good to want our general, in back. reletting we the space, we've in doesn't it So, back, the success by rent we have think, on rules, when space tough we will. if want And if found pretty I play you our Generally, reduction.

Hap Stein

exception the that's rule. rather than And the

Mike Mas

That is exception.

Hap Stein

may It but… happen,

Mike Mas

generally nature. it very in If happens, it's short-term

Craig Schmidt

Okay, thank is That helpful. you.

Operator

Bank. with Sood Shivani your Please with question question. Deutsche next Our proceed from comes

Shivani Sood

market is are markets, the especially Hi, investment high-quality now. right for from that looking we've your private heard the to tight Switching that, you assets good for peers side, exceptionally morning. the

given the the more are year-to-date from we initial could in bidding the guidance? you if versus accretive what So, comment cap higher in the rates differentiating just peer on seeing the is just volumes set process think Regency you

Mac Chandler

agree of Hi, for question. market do the very with There are that, quality your there. that for. looking tight Mac. this is we is I in type that of qualities very fact Thanks the are observation few

We very year, And right, but the just bar. have been market, over high properties buying have not last we years. a off successful are this you several

track I'll that. the an on And reputation quickly example. Pruneyard was our us The around as and based it. to directly for just record ability a get and use arms close That seller our off-market. our came wrapped got We've to to

advantage our I XX think an is markets.

We are in the market and we know these properties very well.

another centers Circle It's on own finally we've where example came a center owner for mile with them. this Marina many is many, we past we to approach three driven our within and years and many been and list half we terms for simply years. the watch

it gives a the to an that us able was advantage quickly markets being agreed into reputation settle and So at for out being a having price really close in upon.

Shivani Sood

in Country color. have changed Thanks a and or changes Center. recent redevelopment part rent the But California at their residential of how then, due you Town for underwriting about that to huge laws that thinking that And project? isn’t understanding the the are

Mac Chandler

in sense develop with we XX-year who particular that. is apartment a one have is interesting that is, going to That ground an developer, lease a

own they'll construct so it. They'll And it.

increases have in We rent. that

with a been have for hesitation them they forward working project. now. year So, the moving no about on with We've

and city that see the as and upon. into are We not rent close they transaction no would would reason why agreed commence we

concerns. it. any in on – certainly have case lessee, our eye an is ground this the partner doesn't But partner being we and So, keep

Shivani Sood

that Thanks color. for Okay.

Hap Stein

you. Thank

Operator

Our Markets. next question. Jeremy question Please with your Capital proceed with from comes Metz BMO

Jeremy Metz

morning. Hey, good

Obviously back Just successful going the pretty also tight to the been year. investment of recognizing somewhat market, on activity. commentary but a you've

additional Here flow. driving you that's deal strategy mentioned and market some the

what disposition you million. the have you $XXX So, beyond your million already front, on $XXX is guidance what close the you've and closed outlined

come really Do thinking you the or that's the the have on early we additional maybe sale here that is that market next beyond and million about be fruition year? of that could kind that buy, excited pipeline should in stuff there about are on active you $XXX either to for anything

Mac Chandler

Sure, Jeremy. This Mac. is

gain. to us advantages One the it like, that buying embedded an that of of center exchange is property tax gives The opportunity sell an a we a has Pruneyard

to And so, we where we looking park we gain that and do have the Pruneyard. into are properties sell, that would a it exchange couple

up we However, have makes close there. XXX And are no are to about the it But, like to consummate a are couple transactions we that. that that are right it's pressure don't million. sale. any feel said, if you And that we under works, remaining But great. do we under out I pressure that

usually to So, transaction, we exact don't get just into details it. the

On the side are the always in market. buy we

always they in successful if our that income are compelling we've been high we'll as the properties. and how for looking for opportunities That's quality address We meet come those bar past and come. are or high way, and our growth

Jeremy Metz

All right.

M&A So like doesn't sound XXXX. color on necessarily Lisa, an here? And then thanks for the initial

the outlined, as Barney's. into the you impact from account, that expectations details NOI we same-store the take On

here, Just should there? about or Is or similar around positive higher from or expectations anything earnings that lower negative a level be growth managing could that about to swing we thinking thinking there

Lisa Palmer

be the expect said in Again, quarter. that a in we'll give But a lot more detailed to in those range. the we prepared similar remarks as guidance I

Jeremy Metz

thanks. and Mac it, Got Lisa,

Mac Chandler

Thanks, Jeremy.

Operator

question Evercore. Khanal next question. from with proceed Please comes Our Samir with your

Samir Khanal

I it's the that about the XX on there, And economics? also, box? how that about think a how I how little on I get Good in? were guess bucks think trying know you or get Barney's. we I color, mean, mean, entitlements – mean, morning, Mike, back on think and and I'm long should rent foot Lisa. property of tenant about back, I the a bit you get have to sort you just get then should to if do we space a if that. more you

Mike Mas

Jim, the next down planning we effectively little he year. bit be we start, me Samir, more Let is and maybe about Barney's he for kick I'll to But space. a on thinking to are as provide color it how as said,

the much to disclosure and roll on our on projects. and as So our as report then more out guidance project have to this other we we continue enhanced come for XXXX we'll

can to point. we coming and downtime, on doing the rent have let we the treat to anticipate of and very board. What But as extent the We'll as similarly our what to I'll back extent we when that visibility Barney's speak of be. this the might get capital Jim been much thoughts

Jim Thompson

Thanks, able real will revenue. that to Mike. We replace like and we estate the really be

is team may But come, are speak scenarios. that more avenues point. in alternative to be we the Our said, And the engaged uses available much evaluating obviously, diligently us. at Mike different pursuing actively the but this as to we all as

Samir Khanal

I sounds guess, that space from – taking Lisa. that a to whether I it's of a side, like of are you offline the the maybe late more bit development sort balancing a little or in server a little overhang lot And you're in guess, of there? a risk Okay. on at the do an more redevelopments, follow-up there are cycle, is coming even a maybe It picture big potential a being even of Westwood. – projects the decision active given the uncertainty question, economic out you with economic how slowdown, projects

Lisa Palmer

projects real that right, in well. really these real really the high These And we own. the even the sitting still types next to knew going country, this recession somewhere worst table. at in quality neighborhoods this and downturn in markets, I in be be and obviously, own estate might we – was was XXXX, are what be, infill barrier redevelopments, our performed really right, already second back I I projects estate especially that generational If Gosh, it's else. when not might

what the economic realize out projects in don't economic have are and well the even And I these that We we will uncertainty, there lot our clouds withstand perform there so, sand. know we is terms we know, cycles in that that of coming. believe of a but heads

Samir Khanal

And they'll cycles. the through go

Lisa Palmer

through go will cycles. they the And

Samir Khanal

Okay. you. Thank

Operator

Wes comes Capital from question next RBC Please with Our proceed Golladay your with Markets. question.

Wes Golladay

morning few are everyone. good sounds like mean, to it percent, now us last Hey, from cycling watch Can but a give you those it update your on an you a list? few of quarter, it tenant was sounds I tenants. like through

come what is store exposure? remaining So did down? that And department your

Mike Mas

the past. Tenants, quarter-over-quarter you'd talked from From we've three is this Wes, have no a really list come Hey, Mike. watch as what list. the in is perspective, off mentioned about change

is different forward, of we no – X now as our around Sears, look cetera we like eyes tenants moving Barney's is Pier are to longer and there et But impacts others. So, class. a and obviously

XX NOI situation are to point point would bankruptcy mentioned are agreement. the as we Barney's/IPIC neutral. that absorbed are But I'll go with essentially care JCPenney currently that of this since I in back to that XXXX. range basis it's we've the say, outside for that our We figure, looking basis been pretty taking tenants into termination that at. of we It's history XX

Wes Golladay

Let me Xs the were Pier Barney's, and JCPenneys, the list on clarify, the of the... just they the

Mike Mas

Absolutely.

Wes Golladay

Okay.

So – now? but is that, I mean, some backfilling

Mike Mas

three looking to the a that been change be No. about bankruptcy watch I we risk in – you it think when we at teams that mean, are their have are risk maybe list same where of We to we'll would And in that's range. it's perspective. generally from think and our are want categories. obviously rationalize through historically aware closure then, We can I just look fleets. walk that. store we financial our

that generally regard. we those centers in you well much as Regency lose We that typically space otherwise as upper rationalization upper the and in Generally quartile the in think. speaking would the perform scenario, of don't half, own does change

include financial fleet changes And retailers maybe to lastly, be shrinking we'd distress, then – some to we through just or their actively not are aware in sizes, want that like of. be to operational who came but operators may

of down a is tick but and the through that You about the probably through going we move put Barneys list, fact to all are list same, Wes. it's the that Sears together, the we moved it because

Wes Golladay

And then remaining about department exposure? store what Okay. the

Mike Mas

that? is What

Jim Thompson

very, low rent Macy's, in a mainly It's very

Wes Golladay

Serramonte? At

Jim Thompson

Serramonte at Yes,

Wes Golladay

Thank you. Got it.

Operator

question. question from Green Street Vince next with with Please proceed your Advisors. comes Tibone Our

Vince Tibone

Hi, good today? morning. was What forward versus doing the just rationale offering a issuing ATM the equity through for equity

Mike Mas

is this sales Mike. Vince, used Hey, before. forward We've

to like So have that a opportunity record track of fund for we needs. We match that tool. us our best

pipeline. redevelopment So as for and towards we XXXX why we we in look use pointed That's effect to our plan building forward? capital the this

Vince Tibone

it my earnings but is the a to guess a just or than little forward? are it dilution trying accompanying a of that with near more more perspective term, there, I I the fees is bit get get am match helps in just And offering normal from there sense – there fees doing funding I

Mike Mas

is extreme a the - it negligible. just margin On fees, but is a touch more it

Jim Thompson

else to is forward economically, Yes. it. wouldn't choose we better I or mean, the do

Vince Tibone

this the Or rather? then day, XX for do And over raise equity you one-period you phases it. Got can months? or next just a one, and – in multiple is the that will one get full

Mike Mas

next issuances? our calls on we quarter either timing, as It's have roll we've we'd forward Vince. the And in that past discretion, at in clear, be subsequent or when on out had will guidance very outstanding our the we

Vince Tibone

really talk space about kind general? in helpful. Specifically, curious categories of merchandise little the of Got shifting just a the out segment am you and Could one kind in or retailers I more, those, bit. your shop gears in which small the are little of trends That's seeing of of, you portfolio? it. And are a shop bit moving

Jim Thompson

Yes, Vince, is Jim. this

I made think you As I still think strong. we've the leasing evidenced we market by this feel the year, see, progress is can

categories, same that it's obviously. business activity really pipeline fitness, - doing all restaurants, the are The strong. and been robust. with really Our our is across off-price, activity good remains But the the folks seeing it's medical, beauty, regions we we've

about good fundamentals, feel our we think our I fundamentals. real

Vince Tibone

the on any outside and bankruptcies? seeing within been because weakness where throughout you of I mom-and-pop leased Are just with but fallouts just result has flat then year as a shops, has know of Just kind occupancy tenants? the been fall

demand on of the there? drop seem still to is Just a you changes occupancy like of does of out But little the seen the shop bit and you more sector kind elaborate shop negative side curious, because it it – have where others tenants, flat had sound this you've if year? does across the

Lisa Palmer

the everyone healthy going And that level. Jim think, at I remind am water. lead pretty to I want it's percent XX.X%. I to to is, leased shop a our

Mike Mas

XX.X%.

Lisa Palmer

XX.X%.

But increase high the So, think I occupancy, I and that be watermark. that we believe I we have add reported, might we can. think also those can of that

part just that's renewal every we we we are going of underwrite So, market four people of reminded property were rate one underwriting the are fail. and I a tenants showcase say essentially business. Raleigh and And that that to we and did do we've buying out in when there a recently

we as business. So, we terms up of that earlier this drive the that just be very coming but when survive thrive traffic of tenant think are and are proactively Jim standing And even going to centers. not our is and for way we people really energy that's kind really that our in still, and able are alluded to renewals, survive, Is that evaluating. manage to is, the a ones to

flat, So, I I think believe that if that meet could think help we kept that while we it XX.X% expectations. that do and I increase would our occupancy,

Vince Tibone

have. color. No, you. Thank helpful that's really I all That's

Mike Mas

Vince. Thanks,

Operator

Michael [Operator comes Instructions] with question. Morgan. question proceed from your Our JP Please next with Mueller

Michael Mueller

Yes, hi.

the over going next excuse as give can how some later bleed year, us in XXXX, In terms play a as it sense of is more into well? expect, of the because of year, it's to bankruptcies obviously the to the expected hits flat me, NOI you same-store to for outlook timing that the out, the

Mike Mas

I expectation. of Hey, to supporting, to XXXX will all come expectation Mike, of positive, flat be timing to what clarify slightly more on our

However, know bankruptcy. Barney's in is all in know IPIC is bankruptcy. We we all

full would in of be we brunt safe So, that to assume that the are taking it XXXX.

Michael Mueller

Got That it. Thank you. it. was

Mike Mas

Mike. Thanks,

Operator

Tsai with Our Please Linda question. question your Jefferies. from comes next proceed with

Linda Tsai

using your dividend target? this you'd that and morning. where term into reduce cash redevelopments. you that especially aggressively, during this same-store good growth period raise the free probability account your Hi, ratio, peers, is maybe but more Taking acknowledging to below compared your your or Does longer are developments low payout

Lisa Palmer

that Before after Mike cash is dividends. free answers, to me that you let remind flow

Mike Mas

statement clear. dividend Correct. our we are annually. Linda, to in are to we committed And increase that – committed very We made

the growth what approximate we've rate enhancement. that given we growth growth portfolio from we pivot low And earnings the XXXX rate. are made of around our we then dividend think, is, that reinstituted payout ratio I be said when also our annual would

dividend I amount capacity do to flexible to have positive be would to a the flexibility growth, and slightly that there. we should the similar of translate flat although, say

maintaining to dividend So commitment But more annual to that do anticipate come. that we increases.

Linda Tsai

view but in And just then Thanks know general of speaking, giving and acquisitions next the year? what's the for for guidance, balance terms I that. between you're broadly not dispositions

Mike Mas

said, we portfolio. and I’ll our I repeat, Like like

We NOI or we that at long-term to amount. – ability We small to pays X% our of risk at continued recycling exposure objectives our in at committed think going are to meet in same a and better. growing the forward are that, strategic dividends our of time, tenants

been in see is So, X% I in that guidance more to come. surprised of range. the But approximation done what historically to has we've that which be wouldn't

Linda Tsai

Thanks.

Mike Mas

Thank you, Linda.

Operator

at questions closing Hap call to [Operator Instructions] further this comments. are turn Stein like point, the this I'd no At back for There time. to

Hap Stein

all of to the Yes. and to treat weekend And Once Enjoy again, at with want that. I Everybody you a investment a real friends community. been your Halloween you. forward thank NAREIT. with in family day. working number great I It my beyond have a upcoming seeing has a look the

very you Thank much.

Operator

This conference. today's concludes

for you You may your we at And thank your this lines time. disconnect participation.

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