Regency Centers (REG) 5 May 232023 Q1 Earnings call transcript

Company Profile

Participants

Christy McElroy	Senior Vice President of Capital Markets
Lisa Palmer	President & Chief Executive Officer
Alan Roth	Executive Vice President, National Property Operations & East Region President
Nick Wibbenmeyer	Executive Vice President & West Region President.
Mike Mas	Chief Financial Officer
Michael Goldsmith	UBS
Greg McGinniss	Scotiabank
Craig Mailman	Citi
Nick Joseph	Citi
Samir Khanal	Evercore ISI
Juan Sanabria	BMO Capital Markets
Anthony Powell	Barclays
Lizzy Doykan	Bank of America
Wes Golladay	Baird
Floris Van Dijkum	Compass Point
Mike Mueller	JPMorgan
Ronald Kamdem	Morgan Stanley
Greg McGinniss	Scotiabank

Call transcript

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Operator

Greetings and welcome to the Regency Centers Corporation First Quarter 2023 Earnings Call. At this time, all participants are in a listen-only mode. A brief 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 introduce your host Christy McElroy, Senior Vice President of Capital Markets. Christy. you, Thank

begin. You may

Christy McElroy

and earnings welcome first morning Regency to call. XXXX conference quarter Good Centers'

Joining Lisa Roth, today Nick Mas, Operations me are East Wibbenmeyer, Chief Officer; Chief and Region Financial Mike EVP Executive and Officer; President. President; Alan Region EVP, West Property Palmer, National and President and

beliefs future contain may those XX-K are on As with that and forward suggested actual most materially including differ the financial may about expectations market detail results in These we company's based forward-looking may and and the are statements conditions. a our current subject recent from our Form materially statements possible differ more reminder, risks filings. filings could today's included today views presentation are XX-Q the management's make. performance, uncertainties. be Factors earnings described in statements in and and may cause discussion SEC, forward-looking that to and our of to business in risks these and and specifically guidance future results actual various It's by from

discussion financial our in disclosures also are we to In Investor our quarter's non-GAAP including related reference Please posted a that Relations posted this on forward are materials, on measures earnings which included with presentation information, comparable additional The website. will financial measures. have earnings website certain note today, GAAP also we guidance. our

presentation applies these also forward-looking materials. caution Our statements to on

Lisa?

Lisa Palmer

Thank us and you, today. you Good Christy. morning, everyone thank joining for

especially recent turmoil. are results. economic is with in Yes, the positive pleased we bank solid outlook, there to uncertainty quarter We acknowledge the another report given

to business. seen it. we signs of So we do haven't to continue softening date, in our for But look

book, And update consistent for have positive year. and outlook this we months in the even remain in quarter ago. trends is with conviction more our with three more in fact, Operational our this a

drive as our base in across operating in and the is in rent momentum redevelopment to case space as and our program. remains growth. strong, our our also within for well our development demand pipelines leasing ability This Tenant centers entire sustaining the portfolio

sales as resulted rents, outperformance We've categories, this grocery. in elevated tenant of areas strength consumers inflationary as those and absorb our ability especially seen reflects an We trade in well, higher continuing well in believe which in percentage in as restaurant to impacts. have

will to we of nearly our with Beyond list retailers As widely we in to from have tenants discussed most call, some space. filing been a seeing time. tenant has for But surprise strong seeing ago. watch recently related And been the activity backfill our been and this as teams are us, weeks as more anticipated bankruptcies, Bath have last none Bed activity from these on demand to a proactive Alan & two discuss, we're our

as it is bankruptcies the long of proactive these to the exposure result or accident limited time, relatively over luck, a strong assets that and as asset of Regency's quality is of period and the ever by our not of selective portfolio tenant as We management advantage ability believe merchandising be us in the been. in-place roster it's today and locations our to our the gives centers. is

One the transaction to seen quarter change our update have that last is in markets. we since regard

very market competitive thin. impacted I was have again I bidding and activity weeks to we'd that financing that volumes increased were recall share remain but after short-lived, with that the see commented today within was points that we concrete that as You data may returning. starting and pretty situations instability transaction But markets. in you, transaction uncertainty hoping was by more to the

perspective. investment remain foot we front said, on our That an from

competency a This at minutes, team our I'm track and few pipelines. as aware. free and a has opportunities grow our and many will of are cash the As this you call work core And team industry-leading new of hard development on a execution. flow our long redevelopment of Regency, is finding to proud record of long Nick discuss been in invest successful

summary, tenant in sector we shopping in areas, with and trends as trade continued that, a whole demand In impacts. the and greater to the given potential supporting suburban enviable positive we markets structural are capital resistance adverse an economic position center believe

us further, and the people, opportunistic, still to while from to of benefits delivering quality balance we uniquely and And results. including sheet access quality assets our also strength advantages capital liquidity, believe competitive Regency our exceptional that our positions be

Alan?

Alan Roth

Lisa, operational another everyone. has historical by continued, positive The Leasing and year XX% volume leasing, XXX-basis by of where quarter XX we last occupancy on points remains and in continued point average. with during morning, top above a shop was in another new you, up good activity led the Thank leasing strong trends. strength quarter experienced evidenced our as leasing retail robust XXXX. environment of was quarter, first basis Activity increase

GAAP locations, mid-teens while base and and We negotiations allows are leasing most were our limit our the our rent net gives in capital managing metrics and investment and remain believe, maximizing XX-month these us the us reflective spreads QX of mid-teen the leverage and trailing Cash shopping a The spend. spreads and centers in of rent to our effective are return. our to ability basis. prudently rent quality effective which both And spread of rent lease importantly, on reflective capital GAAP and healthy. net spreads growth, drive

continue would and of effective encourage XX Nearly, end, rent of our had rent on is rent review for a quarter have percentage highest disclosure to I escalators new page you our XX% the driving in driver shop rent embedded supplemental. net Embedded leasing are huge our leases growth and that we shops. on to all steps. To first these record of XX% activity steps, which success of our

base solid getting and are only more in to pushing of rent leases. we're not NOI the positive and but quarter increases contractual growth. of results higher, contributed So operating we activity These same-property rate them another

rent. activity conviction but signed, incremental and our trajectory. pipeline further million not forward base provides strong is $XX remains it basis points, occupied XXX quarter-over-quarter importantly, at Most of in flat Leasing growth our annual representing

we that commencing leases are the each leases quarter, with new are the pipeline we So signed. replenishing

we've see. only locations XX of Bed Notably, leases This signed, of footage which square disclosure is notable our but Bath activity associated basis our the includes tenant Today, to LOI for also most one of includes continue pipeline. Beyond, million under points of of further of demand we enhanced feet strong The also not recent occupied and XX interest. page with information or on recent nearly that new reflective we comprising have strength have square the filing negotiation, on lease these XX & bankruptcies we which seen ABR.

Five we of list, last these locations week's on which were expected. included rejection had

our Bed locations tenants, been teams of backfill opportunity Our with potential remerchandise all on proactively have the in Bath stores. of recapture to anticipation engaged the and

décor, uses. we from grocers, Demand and off-price retailers, in home is several XX%. anticipate many of sporting medical goods approximately average for categories, including multiple resulting spaces This buying these mark-to-market and retailers is coming of

country remains suburban addition continue real to strong. manage around Bed all to Bath, leasing best estate demand great exposure. of In of actively the we tenant some and areas our We in the trade at-risk own

an environment we really are operating good retailers team positive retail of not are back In surplus of are in momentum the limited great growth environment. summary, looking that about continued spaces and get feels actively seeing expand. We a afraid in new the supply to to our

Nick?

Nick Wibbenmeyer

Thank you, everyone. Alan. morning Good

excellent We of team to development executing continue redevelopment the job has and quarter activity progress, an in-process on $XXX make ending with keeping within Leasing our on done projects. our strategy, and of great strong million projects schedule our remains budget.

is equal cash and Regency expertise, our offices, positioned on expansive given As access to deep free three flow cornerstones, to fortress our balance our conjunction of calls, us sheet throughout development attractive advantage our country. by we XX and unparalleled with extensive source have an relationships opportunities in are and to an investment capital, discussed contacts contacts, on across and pipeline, capital grow our industry give execute and combination our our uniquely the our prior capabilities, development utilizing our

development best-in-class in in extremely the barrier the New For will grocer, million instance, Metro by located line of to $XX specialty This on the an York area. a investment high be anchored project market. finish are entry a nearly and we purchase nearing

we week development the in and on thriving phase community first a master closed retail XX,XXX-acre of this plan a also Metro Additionally, Houston.

million, Although of to to forward the first do anticipate scale pipeline. project $XX able phase in-process our when being add look we both them in to we is the grow approximately details at smaller on these projects We in years. sharing future more

of the City. Beyond ground-up adjacent of of buildings our Phase Center within current JCPenney in opportunities the two to continues our project and our started This Subsequent end, small developments, to million to on quarter III Serramonte create Daly execute redevelopment we portfolio. the value includes Macy's. $XX to at investment addition redevelopment former team shop

lease We and and center visible have of And bring we're front the concept operator project at shopping This for highly to executed their excited of the sits with will new bring a former grocery door market South Area. food to Bay best-in-class the phase JCPenney Korean the the to center space. XX% the leased.

drive on continuing our starts. pipelines remain creation are million are Mike? north seeing and free by redevelopment future to focused In summary, development of we value to of our encouraged flow the reinvest to $XXX opportunities cash we and and build annual

Mike Mas

a from couple our with first good changes to of and year start guidance our Nick through quarter results earnings Thanks, morning, and everyone. walk highlights full assumptions. then I'll some

basis rent same-property re-leasing period indicator of continue strong rent, positive in rent XXX is driver Base quarter. escalators, see we X.X% embedded was And the growth points portfolio positive to contributing COVID the from occupancy NOI strength. first we Excluding spreads year-over-year. impacts collections, the most our and in quarter. base space important reserve on largest of growth higher delivered a The

meaningful basis tougher Notably, seasonal comps, same grocery despite driven sales-based with quarter, growth, in saw year. rents and sales. the percentage billings continued restaurant in first year-over-year contributing of rents on tend also be We property to XXX quarter in points of occurring strength percentage the NOI the by the majority outperformance to

contribution XXX-basis same-property lease The first income. meaningful driver from to other quarter point was uncollectible NOI a positive

experienced XXXX The the the normalized variability lease on basis COVID decline uncollectible collected and base. contribution debt picture health and create isolate But increasing tenancy period reserves results. of billed cash resiliency from and of to basis To to cash this tenant can a tenants, reserve our line and reserved to bad the from in we XXXX some collection better-than-expected on the and rents collection to end, income in continue the we originally a in quarter-to-quarter. quarter, demonstrate receivable rates of as better rates item that balances collection We positive provide and due XXXX. of realities

NAREIT our detail the earnings FFO and point in like our first guidance. the uncollectible lease to per through outperformance presentation. rents driven $X.XX X increased to to you X in I'd by percentage XXXX Turning each in helpful share, quarter. both income operating investor ranges core largely the on guidance and We've Slides by

the spend XX-basis new these basis collections. points also previously. revised a COVID assumption, growth also for I point Collectively, to upward period full minute range X.X% our on range to our items of revision a drove credit XX to of want lower reserve the X.X% to to a basis same-property points guidance we excluding in XXX year XX from loss XX which to NOI

those our the Bed same-property was mid-year. ranges. a in by potential previously Notably, liquidation per contemplated capture the earnings Beyond new of of scenario ranges NOI of & full the midpoint and now This low share Bath end for

quarter year However, credit this our that offset bad outperformance by discussed first I assumption. positively and change loss full impacted which was earlier, debt

Nick executed capital million we the over $XX just planned Mountain roughly average repurchased the kind units the to issuance at an a This hedge XXX,XXX the per $XX was earlier. for to development York in like that New late share. repurchase seller price of March, side On project of OP in of shares mentioned

typically $XXX projected I investments' to of highlighting remains than opportunity sheet, EBITDA our is are range do, afforded in pipeline. markets' never significant Leverage the as times which strength of at more X.X north free the debt of of the this cash and times low Regency's end end I'll capital year funding evident turmoil. million balance importance be five targeted flow generating to our of to we of

billion allows of This line opportunistic, environment. to And We in debt have access there year. strength and this $X.XX credit. to are no for a with significant our maturities of be us position over patient evolving significant liquidity

we your that, forward With to taking questions. look

Operator

session. question-and-answer [Operator We'll Thank you. a now conducting you. be Thank Instructions]

question UBS. is Michael proceed first Please from question. with your Our Goldsmith with

Michael Goldsmith

in -- Good the you morning. that leasing any seen on for some in the Thanks my have was question first My have What March? sustainability Valley lot a experienced taking leasing Bank demand. question. seen is the volumes you change and of the disruption of post-Silicon

just if leasing have this of any they're just sustainability sense seen talking reasons the of that recent resistance slowdown trend? you are to And express about, sustained in anyone a April? get the long-term And in sort what has or trying of

Alan Roth

Yeah. Michael, this is Alan. question. I the appreciate

demand very activity million We strong our regions. we of new got seeing over in across many are mentioned, in pipeline. still And categories we've of square feet the one as all

look kind and actually the February. of road And new think and had the about March, exceeded back we when that March mentioned in January we both bank bumpy our announcements of activity you

And April quarter, as new January, March has have activity visibility first we to independently. of then, activity well. course, of and obviously post-closing actually exceeded February April

It's not retailers. you in a across that in the we've the would pipeline. collectively, as remains sand. we queue think we feel finish The still coming head it's are got line plenty I activities tell deep But good. that really forward. quality still the look is we So and Again,

Michael Goldsmith

it. that. and seems Got we talked was by Mike. kind the question like outperformance follow-up for driven is my Thanks for of And of rent XXXX the which guidance upside It to base about. the half

termination of the some maybe percentage lease and driven then, rent fees. was or upside in upside rest But near-term kind by the

So here that. the sustainability is a that that one-time Or recur of item I year? is rest just guess, the the the through of sort question shouldn't of

Mike Mas

flowing internally the of that to Hey those – estimates full are mean, had quarter it's -- won't impacts onetime some clearly, year results. we Michael, we through resort combination and our a I both. beat to first

balance as our outlook Bath a Beyond by our conservative up And Bed added the filing. I there impacts tailwind ongoing is as We've those -- become of covered year. the to guide. quarter would little been But in bit the slightly lot for first of a remaining of more & the on say the with visibility well that's

There's ourselves the from rent, the in range see do first locations. -- some back floating we So Bed base the top-end from lose into we quarter. floating guidance our into headwind as Bath

basis what year. lease slightly coming a an the average on call to better historically income ongoing it, little we outlook with I had bit Our uncollectible into would remains maybe from

that of point rents. I demand story best there tagging the Alan's the that's is, our leasing we're commencing And The our see shop $XX and to on to continues be pipeline, million ABR year. will and on will renewed this the in we a of in factor great that's driving XX% just fact same pipeline deliver the growth. year. this that of that of come in property And -- our outlook on --

Michael Goldsmith

much. Thank very you

Operator

you. Thank

question Scotiabank. proceed next from with Our Greg is your Please question. with McGinniss

Greg McGinniss

good Hey, morning.

Just to end about might at headwinds/tailwinds where the some kind those we of the touch end year. thinking of on of up

bankruptcy from this maybe time? of you the bit occupancy year-end leasing on expectations flattish potentially. of at through Beyond year-end an healthy QX last think given call, I about occupancy & talked this kind But about Bed a Bath you kind little thinking how offset of are the

Mike Mas

essentially -- bank bankruptcy envisioned how The we quarter a flattish. the out it would ago. still Greg Hey is turning

the on that the by how down be up, to depending remains potentially end we're slightly auction outlook flat same proceedings going to year-end. our So,

use -- is remember the But may through have bankruptcy that of again proceedings. overwhelming which occupancy we contracted that delivering we through shop demand that word lose would that that from a we -- we have of I and -- come this the will have perspective, space that is already all revenue what all tailwind

Greg McGinniss

watch follow-up Great. to Thanks. on wanted And I the as a touch just list. tenant

our regional based obviously the on been a think I in look. news have banks lot

confirm. around more exposure any It's have to XX there out ones called love been points think. to You I have that don't you We'd maybe-ish the like have basis yet.

Are curious of what discussions well? on on bank GLA. than outparcels limited exposure, spaces Rite those Kohl's, as you especially we regional kinds might backfills of potential X.X% maybe spaces of to and looking demand you other Aid, some at more some of risk then see in level And for I be on Michaels, the there. like On those seeing think

Alan Roth

in just tenant overall generically of watch the I'll answer question list. Greg terms

those evaluating get off those We are list come that added. both always who's it proactively the on

aggressively expirations field terms the upside in in out terms constantly of of are volumes at traffic teams downside. foot spaces those Our terms in sales and lease looking in of

there's we we back take we're it. concern getting it if they're going opportunity out of we so an And proactively out that. have in front to think want we're vacate of where If front to in

and include And so that an watch list you the I to mentioned think totality might some that's didn't. have overall just really the comment of you for others that

Lisa Palmer

I'll just come bank over the -- top mind Alan for branch. if doesn't I'll

correct. observation your think is I

tenant are Wells, think JPMorgan, Our exposure significant I of our you've I on bank America. mean to the list got Bank branches and --

of would any bank regional be really so have the we branches And that immaterial.

Greg McGinniss

Great. Thank you.

Operator

you. Thank

with is Please question Craig proceed next from Our with question. Citi. Mailman your

Craig Mailman

environment. morning. to leasing the just to back circle Good wanted I

You are rent guys kind I lot rent guys of coming healthy. this? these more adding and these from And OCRs through where of are pushback a escalators escalators pushing on kind in leases spreads getting given in remain to are resets? tenants increases mean you rent what

Alan Roth

question. and So, all that pass -- higher able we're XX% it's on escalators -- a to you there's you. XX% widely therefore Craig embedded shops lot Thank inflation accepted heard our Look us deals of through had and impacting of of saw all include had as is these of our to and those. think I good steps rent us

seeing them we're but in tremendous values. having not getting a pushback success at not higher of them success deals we're so amount them only having getting our And I'm in there.

direction are the think retailers. I up sales our of most are going inverse costs because frankly generally for going Occupancy in

categories others to it be some pretty in that will further? forward. to But us they to the ability in it that in so I levels reasonably will reasonable operating doesn't. going think give think and really seem And healthy those push maybe provide ability an all push I Craig

Nick Joseph

Thanks. here It's Nick Joseph with Craig.

it maybe some allocation. you quiet was capital purchase on but in shares. first quarter did Just Obviously, the

are number then share on guess what seeing things repurchases are second from market? starting one you about to you part how Are there? I additional So, the And the show at transaction all thinking here?

Lisa Palmer

Well, And overall to the to repurchase. for transaction back. I'll it share market. quarter going Nick toss I'm Mike we'll the then answer have

Mike Mas

Nick, Hey, good question.

the So repurchase. on share first

want to we that competitive that a me I prepared tactical to tied can quarter. Let this we at And as it to possible be say be development largely able in marketplace. that have. my remarks to was opportunity great a flexible And in We which think this that outlined be point differentiate. as we was

We of are the when aware and of And we're ourselves back a pat that value. opportunity we units but are deal, our on hedge obviously NAV perspective big at very make our necessary the same to this keenly not we found will And back. patterns transaction. to time,

what I an time think designed did arbitrage will do transaction that we that pretty which excited nicely we're as perspective But hedge was tell. was the unit issuance well pursuit to that simply of to about. from development

Nick Wibbenmeyer

in thank data few surprising to a remarks market regards of the to Lisa there how our as little Nick points transaction And in alluded opening is that in you, QX. were

quiet opportunities opportunities and the on that are we the or and are have So said to and And to act it equal meet the in growth quality that been focused very, portfolio. that the criteria. on capacity desire has accretive to as always we're current accretive there. earnings But our very the we've of those out past, that

in take hopeful some it and on so future can the very that more we we're of. up near we'll And pop advantage opportunities that focused

Nick Joseph

to all has the changed And just before? it on development relative then at side where Thanks. there was pricing

Nick Wibbenmeyer

the how on and margin, cost wide us again that in accretive we're we're On use we of I making to sure look what of highly regarding mean and eyes it's our capital best focused on do is going market. open But cost the what's capital.

appropriate the going and on there. risk it that any profile spread depending that so, transaction evaluate there's we fund decide how we're make of And an sure we to

company comfortable working so we're opportunities the that we're to long very are the now on And right term. accretive

Lisa Palmer

generate. is It's And free a into leading development you of the of to what our I remind that flow the the great that best for in cash use believe program flow we me sector. cash opportunity significant

Nick Joseph

you Thank very much.

Operator

you. Thank

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

Samir Khanal

some year. XXX Mike is sort And think if to was the are the impact, mean something were your of at the look guidance, impacting FFO on the were we FFO we Hey, like quarter here but just XXX about we thinking good the I'm you the there to fees morning, did some I it in run you're still of rate $X.XX macro you the maybe there I being given onetime need getting guidance looking and term even use conservative and everyone. a know items. NAREIT overly for XXX or for that are growth? I at

Mike Mas

to earlier back some go I'll thanks. Samir, comments. Hey,

what in first identify first uniquely onetime. and is the Let's what timing related quarter is

the So value. timing-related we being a pursuit that's there percentage efforts is income very for careful team the clearly, a that monetizing The of balance rent that. onetime the and -- recognize impact. pursuit to our Kudos that with higher

time over within QX an will rent and largely recur but is through the year percentage the it earlier years, event. So

So we that factor in. to have

income, balance Our not through uncollectible are outlook QX think anticipating that year. being positive for the quarter, will you of about replicate we we this the the that if leasing

float is term down point area of quarter. knew Term a a have to back which We the received million -- ULI element. of that is adjust mentioned a were averages think was first going Clearly, we again more the fees, for we'll I of that on build guide It we in we our did payment to historical to the As fee XXXX. significant that. -- XX-basis rents. $X previously, have in in we'll

a get part shoulders a business. on $X.XX year foot the in Some looking comments of out, semi-recurring as over We fees. year term our basically

you million think of of the there of Samir. about that's rate about dollars Those run a are forward. going So elements a some couple if

losing our our -- impact and it's Bed think I have will growth. the Bath Beyond we have that forward then on and the & bankruptcy

QX earnings from as us same NOI into we levels guided offered. floating well to down as the back through back core that going that's So property

Samir Khanal

you the second you commentary positive and And leasing. look that. then around or still at the leasing is Thanks very they've around of spreads. And but maybe know But pretty quarters, for seeing? if it's my I mid-single few month-to-month. look good provide decelerated on spreads it's I just when the look growth. question bit certainly provided those color leasing again I When a digits that spreads last right? volatile at get But we're

Alan Roth

I Yeah, that. lumpiness and question certainly Samir appreciate with acknowledging happen the that quarter-to-quarter can for the thanks

As transaction a any activity at look over we feet the was QX significant did one the XX,XXX We comparable square last of in that that's quarter, but new we anchor have quarter. XXX,XXX that. deal did represented not feet in square in was anchor that anchor included deal only

when keen activity. shop is importantly embedded than the spend. gets all new pop. look trailing cash of generally on predominantly cash bring which you at XX-month capital big with leasing, rent spreads our leasing that But rent So QX, And and spreads for back lower I'd steps and focus the XX% to our it's anchor the success you prudent

And rent so quarters. testament proud that of of capital of we're a managing page, as over rent spend. And efforts metric those the as been effective base team's achieving mid to in prudently percent has XX% a past new this while to contractual five our rent our net steps disclosure on pretty high range it's the

Samir Khanal

you. Thank

Operator

Thank you.

question. with your proceed Our with next Capital Juan Please question is Markets. from Sanabria BMO

Juan Sanabria

Hi.

up from than did. differently perspective it bit little a or Samir asking So circling maybe different just a

Bath that does is as piece that these guidance, quantum maybe and you the slightly think flat the For occupancy talked now you've call? the Bed year-end, of then to How dip pieces should decline we between maybe down before it of on assume you various a result the capture together but SNL to about about pipeline? by

Mike Mas

into -- our -- And quarter-over-quarter, some it simply on, of and coming to mean on I'd in I say was sequence exposure it rejected you I'll details our think $X I losing million that tenant. year, growth. And the if you're give guide to if Bed same-property They've our think -- when simply trying the use into but from we're Bath. range locations. know we half about

is the of beginning that half QX. So of it at losing

contracted year-end. pretty million as will that said from float would I to as same-property then a the item of from And we're And a is I we ratably to a that XX% year-end. $XX delivering you by that about of growth SNL going about through it of post There a on by about the all come year. quarter sequence think in numbers. talked QX standpoint down X% recovery unique midpoint last X.X% QX our on

the is else need you and But a helps more hope I difficult. that So be comp quarter you fourth little anything if to we'd happy connect offline.

Juan Sanabria

of you. of is first to thank bit benefit question had a That's GAAP is GAAP then terms a for helpful. X Super quick there back page helpful. just the in reversal a does And No, on the that cash in of the assumed anything quarter. to and How that of the balance And year? under? the else to at fall bucket look guidance in what reversals captured

Mike Mas

Yeah.

guide will didn't of change -- see come majority reversals guide. those non-cash the can So we -- so would I and our through you we have as that in

it's on hasn't indicate embedded from to quarter. that So outlook are rough and $X.X there. we impact within a a not good weighted our million that opportunity changed -- has fourth is cash at This X% basis

that I rate the the given we're of good tenancy. quarter and collection cash-based seeing first results out would offer that our

same Our the tenants year. through outlook will continue accrual we that to to the convert remains

X% or year-end. by should be said we the we we last that minus plus anticipate in As area quarter,

minimis tenants haven't you could And it's but convert -- we're is that we come a AR either. Juan. that off could through de so -- There of expectation come as little that well, as bit of

that So I would that guidance on just non-cash we provided. focus

Juan Sanabria

you. Thank Right.

Operator

you. Thank

question proceed Anthony with with question. next from is Barclays. your Our Powell Please

Anthony Powell

like There Nordstrom Hi. are in some shops. Are recently your of malls and expanding some seeing some format Macy's the you smaller on activity Good that traditional morning. their press pipeline? of in anchors leasing

Alan Roth

Anthony, question. short for the yes. answer you is, thank The

concept is Outlet. really company down that one Nordstrom sister referenced you by is signed Jacksonville. So Macy's. Rack Nordstrom They've got expanding Market their in Bloomingdale just here doing Macy's we their

entire it. category So there. rolling off-price they're They're that right And aggressively rocking doing is I think and out really now.

Anthony Powell

growth? one I rents. on be a be of year year-over-year And should it that Thanks. on but rent or either this just a a as maybe was year, base going lower modeling there forward rents next more increase. we percentage percent will get year-over-year percentage How kind say big of

Mike Mas

I'll over consecutive two give Number increased items by in up it's you first XX%. some We've you. actually percentage big that will quarters help one our year-over-year. picture rent

However, it's a small number.

of of I So we X% loaded. keep only your we would about modeling about that out level revenues think total percentage get in front-end pretty It consistent. our rent. should that -- is we that longer-term And

So in of the rate we what income occur recognize first the percentage quarter. in majority will

more We the of in through is first the year will right the quarter. majority balance but have the percentage

Anthony Powell

right. Thank you. All

Operator

Thank you.

of Please Our is Bank Lizzy next from Doykan question with with question. America. proceed your

Lizzy Doykan

for more the through or see expectations variability curious just and Good drove the be in to item meaningful to we by that if was I morning. was noted that as get increase if line G&A there as too we year. just million anything recurring should And wanted full the revised could year? $X what about up not but expect

Mike Mas

and the looking a any -- any identify just and ends as other. forward. it reforecast. And we really or a wouldn't year, estimate just of, It Really lot we way kind tightened the what It's balance of Lizzy. line items There's for non-salary odds the refined I of, our that out in refining look is. Thanks, of outlook. is for trends the kind up everybody just

Lizzy Doykan

had development are opening And area the these share once future? was it you. if you're details Thank in Houston, more planned to and add couple the community metro But those New other you what the there's to able if pipeline. it. York on each just you projects markets about a of get I the to you you just could And to Metro waiting the seeing discussed unique master the that the the to in details more drew near in you projects? of particularly in hoping at in for specific think projects on find opportunities anything understand Got

Nick Wibbenmeyer

good can't Yes, at point and relates morning. as more. disclose Lizzy you we to this Thank New it Absolutely. the the for York question, asset

opening But and forward as in able in being the We future have about excited not-too-distant remarks yet to to I more opportunity the mentioned give we're closed. not my details. looking

and approximately did earlier on master community. opportunity, that is As this project planned although close thriving excited relates to the week again relatively very It small are a within very Houston about it located that million. we $XX

captive type is to audience. So of the And have are we blessing. for retail where be one servicing community a that really those opportunities we're component the only looking very know we of a

do referenced in on as future. expanding we And that opportunity I the plan

phases so we to do think to there'll in continues future And that submarket. that grow be demand opportunity as increase

share when And details even board process. so bring on our more and that end comes quarter again next excited to it into

that relationships. are And said, I right three the the speaking, just and is the this facing and environment execute, challenging And then there generally capital we that right expertise especially said, it development which have never of we're out is. the development as cornerstones right critical to how some is of I as easy. aware well the in are But headwinds

They've are very continuing grocers years. had good to expand. And

is out, we to have want which we we one-by-one really We ones own think relationships the country team ones think across therefore help our and which financial great capital. the and human we evaluate Those opportunities job with of great figuring and and term, long to grocers coast-to-coast. can deploy doing the a we with, continue

Lisa Palmer

to shopping Houston in in And have criteria. to over and long able we're a follows where fit that And grow that And term. New developments two these be development to strategy long-term Lizzy investment invest NOI our competitive overall our want the centers York sustainable advantage, strategy. just we going

Lizzy Doykan

you. Great. Thank

Operator

you. Thank

Baird. is Wes proceed Our with Golladay next Please with question. your from question

Wes Golladay

everyone. morning with Hey, want guys. Good Beyond. Bed just I to stick & Bath

you have get But been think not going doing you're beginning they inventory, you that those of of assets this any scenes? you during quarter. at I or the they I XX behind said why rejected get rent the liquidation, rent liquidate to guess a from the and the five once

Mike Mas

not -- the petition Yes, And they and into million and through first what filing lose less that then will about we post through a collect assumption rent be so five -- their that which not or to itself we lose of be rejection. and or obviously the we may could [indiscernible] in the you for event the an been yet continue happen, would the have we rent date. quarter through paid rejected to lease estimate given planned may were bankruptcy that would $X.X current what future

the We would we pretty we of accommodated our some the for which all opportunities locations. our indicated, some ones the have we those at like -- not could there's we have be chain. option. tells scenario, picked full -- liquidation there's and pretty also have we've be a a of think guidance, which they we know like -- we've of in chance worst-case As been good that The yet us really up we rejected that midpoint

be Bed there. the about we'll Bath. you close impact attention paying helps very But that the to proceedings -- So hopefully financial of that's think

Wes Golladay

some for And with Bath? Yes, here for now of that hurdle sometimes today's bigger Anything Sears markets your -- you at at some Bed potential then it remember unlocked projects projects? bigger with is I kind scale And does. of capital redevelopments. larger what some any

Alan Roth

There's I'll us speaking a start that capital for is not the of really Wes question merits exercise generally you with to or re-leasing or -- appreciate we I as this let whether it Bath Bed is. Lisa asking the answer Mike one answer want short but entertain the are just but Bath that. Bed we evaluating and all redevelopment

Lisa Palmer

return our follows We our And and that and at can strategy. look much center investment fortifying redevelopments, while invest we do we'll enhancing existing as improving if really with I as to development with those cash an directly we the use a and manner. NOI we that flows and and in If regards mean, are that of same our can. getting growth, attractive accretively future

Wes Golladay

it. Got the time everyone. for Thanks

Operator

Thank you.

Van Our Point. next proceed question. with with the Please question your Dijkum Compass is from Floris

Floris Van Dijkum

my Hey, good taking Thanks morning. question. for

you've is and most as space And big valuable that in Your the your two, shop years think was? And well. the the in portion shop past from was a ABR beauty of of X.X over SNO where or pipeline portfolio do Could to your your think, shop your alluded peak of I Lisa, the shop again space you next us comes is remind go could you occupancy you space. have so? the the XX% trend two-thirds what over

Mike Mas

I'll We That glide Hey, color his that and it. I'll a our each in up reminder when and Alan over let -- do from our portfolio peaked occupancy is look to we -- the shop think a XX% path all what about at I he agree guide thinks better it other point was our than at would today then. time perspective. was achieving

are promising I of levels today think I'm occupancy, peaks, even because in was XX.X% will you those peak. those high outsee pretty significantly our better. the demand not that of demand -- that but I think are and we characteristics area supply was

Alan Roth

that teams community and attendance our we ICSC strong. May, at of you Yes. here of the that that's meetings would on we're right And up. go anticipate really just are top know, the the to now. have at is show back upcoming scheduled And the the end I falling retail as that, of of pipeline XX.X% from really already great the deals put And I'd Vegas amount

planning set the So, runway high. continue our sights to to we we're and have

Lisa Palmer

space I really this, important where of ever. -- sit tenant that that And strong heard of that There's health relatively makes we in-place coming box, our say makes as I what good it's tenants. so And versus to And in lot what's occupancy. But it that with really as always we able us higher. change going all happens less COVID. be the valuable, believe there to you've And is quickly think that out today shop the We you that you, about, really what anchor shop rents are and we're say as that. peak the a feel We capital it appreciate versus so think our We is an the replace that remembering time. business. about when fact there's failures. say some valuable,

space And so much what shop makes space addition so space leasing spreads really that that's that in so in good able us. continue to more what annual valuable. that's to new makes valuable get the rent contractual to upon And steps, leasing. We're to,

me are not what say, over to over We shop afraid and again. you've space. That's heard

Floris Van Dijkum

appreciate the the I if me Maybe the produces. bumps. sort aspects that's to the of most you've that. that and that can one of talked about business, And speed rent No, underrated -- of you cruising

cruising getting do You X% space your see almost And mentioned, all rent of leases? speed new as how rent sign fixed shop that bumps? your you evolve, has you are you that bumps,

Alan Roth

at would I rent having Yes, I even more question. the you higher. our the teams at And Floris, are I probably would to tell X% on if asking that between pre-COVID, depending and X.X% Yes, say, And anywhere are X%, higher we're rewind we appreciate shop historically, or success for to leasing in cases now the starting sector. in you clock X% bumps. were some circumstances

I evolved. path. I a the bit more continue for And foreseeable it's that commonplace are. think future, of we certainly do And where down it of a expect become so has us to

Floris Van Dijkum

Wegmans that? that in least, Any coming not be to involved guys just but last Connecticut. Maybe chance you might hear, I Thanks. be might

Lisa Palmer

I'm looking at, Alan.

Alan Roth

involved not are in that, We Floris.

myself. hearing Nick going we're Sorry, whether that answer rumors. the I to was it same didn't know But who or was

Connecticut that for the community, they great making happen. end be they'll So, up if

Floris Van Dijkum

for That’s Thanks. me. it

Operator

Thank you.

Our with next Mike Please proceed from question Mueller is with JPMorgan. your question.

Mike Mueller

Thanks.

two the questions. for So

are XX% the The one, getting you about what of XX% the of characteristics X% not escalators? to think where rent or before. the you're first XX% talked I leases

-- So, about pipeline? not thinking component forward in shadow $XX shadow healthy We're million think new new a going it. as the pipeline, pipeline, the have where what's you're mix your ones like redevelopment million $XXX redevelopment. And I development opportunities it the Is getting we about development does it at as the then, look well? it's

Alan Roth

exercised pretty first It's Nick. don't simply is that XX% steps. It's X% Hi, answer getting That's rent mentioned. part. I'll you embedded to simple. Mike. it have Alan. I'll the take to that are options This the

Nick Wibbenmeyer

visibility, redevelopments. you it. And and And it. some on as in the right. question, those Mike, in absolutely, we've always to of relates we're I opportunities you're to your pruning forward, for part investor some to to given we it our of second as continue I relates push our future mean looking the opportunities it reinvest portfolio as deck, appreciate

I potential yet don't detail of of But level on that, same we developments can't clearly, the disclose sort own. ground-up

very pipeline you is And that so on developments. including I'll ground-up shadow mix, focused tell our

Mike Mueller

Okay. Thank you.

Operator

[Operator question your is Stanley. proceed Please with Instructions] Morgan Kamdem Our next question. with Ronald from

Ronald Kamdem

Great.

of couple a quick Just ones.

talking future trying the it of banking over see different about or done? in about in down And but Just feeling is ripple sort ways. redevelopment of to change recent of the with guidance to thinking are debt does opportunities your any we conviction is are that it is should of trying $XXX perspective. been million you activity? to pretty great obviously feeling opportunity? system, in the more if seen getting Clearly, the thinking X sort I'd pipeline went does I'm on then there's position a of thinking or in You anything of effects those Thanks. of events other to piece it? you the It the presentation acquisition effects timing the have about? I create Just understand as liquidity guys guys be any good. And tenant this are the And sort to love understand a One sort ripple hear the about front bad tenants business? million if it of from X $XXX there's

Lisa Palmer

cash now challenges. capital with our on flow from whichever challenges may wood happening Look Alan do have describe, generally can beyond access you that. And we're add fund some knock remind use not right tenant own crisis the piece what's yet color. and certainly word start any we market you Ron free not any seen issues have from personal turmoil perspective to impacts Nick or using speaking to to and in banking But the we hit want I'll I'll that. to some

and our associated you know, leases. to see talked seen We it then we with we underwriting if start do the we're continue thinking think softening signed to our a the as new corner it are of about there and until to going are with yet. very have So try not or I visibility about program. not to around as we becomes And development we leasing don't And have and new to development impacts we how development an developments. real we we're look business the speculative are that's disciplined signs

and or flip part a an off. underwriting successfully it's takes not as on past growth and expect continue we will more appropriate little we to development We're we our that it's some the cautious in important our and same. of the think And you have -- take think cycles developed do about cycle. They through bit just And is something switch a we just that the profile. It prudent. I time. And that's

Alan Roth

answer we the level. portfolio Ron COVID tenants. at is a to no. and programs that short property our perspective We're started just not our proactive and support That tenant enhancing is a during on currently from And basis hearing simply the said, that team utilizing

do webinars tenant toolkit. got We so, And proprietary program. success them. mentorship We've for merchant got we've a this

prepared tide with but to turn retailers with should the deal not them process. and through proactively that that only to for resources there And that, have partner them our so we're help

Lisa Palmer

We apologize feet. and take positioned believe advantage back the I your our jump it really I'll market any on front we are are We've we saying, that acquisition of to and in question. opportunities. compelling been missed I dislocation well

come we discussed, to lot seen ready haven't a but we've we're market, As they do. if

to long the accretively. it's are poised or as earlier answered capital. Nick equal to our the to that able we accretive he And growth and quality as have when our acquire and We said, question invest rate And act. we're as

Ronald Kamdem

one. last just then And Great. my

quick thoughts Thank situation views and Kroger Albertsons the any company. on for Just the you. updated

Lisa Palmer

go you you any from going the last the would were and have read thing probably I that I'm don't don't and that think say back exact is answer my same if say to we quarter, to now, right have. it information

unfold. The have of to that really both and is just it way will with for it I think goes, something good be good relationships either them us. We continues

doesn't merger For go the through. reason some

into good for be really usual. our in with real and their it you'll locations feel part through, We have does may those merger good plan. back ability really to go greater larger their locations we grocers and as greater If really invest good be of the about that two estate And operator, business will scale, have business. our a divestiture

Ronald Kamdem

All about and thinking hearing guys What's you all? Clearly that of about -- the Florida, some thinking forth. are right. I the that One But back it. notes that markets we've insurance come costs in at you Has guys you how sort But -- I other up? the my guys -- property charge tenant. so so on more of are there? to missed had you premiums in been sorry and

Mike Mas

Hey thinking about it's absolutely Yes, Mike. Ron, it.

team job are behind but extraordinary renewal challenging. With bit little an the a very The without recent of did the They're markets renewing policy, not difficult. pain. us, our

planning -- we're about XX% XX% that increase a line More second. we're have, We results from item. a in expecting perspective, to in on a that

our scale, maintain to insurance think our access But about is our our way our think I most given better the moss quality, than track we record, and properties.

that today, is not is team, challenging the access a level small just but price because about kudos at a about So to scale access.

the With respect is a to the component to rent. increase in tenant's of line small XX% that item, relatively XX% it

foot lease tenant. the when $X.XX It through we contracts, we the that it So a about think a pass-through, or can our of the bleed is in you through. pass will pass to It's through. neighborhood

pretty a component. small it's again, So

I and challenge time insurance it's like if think So again, mitigated when will we've and to challenging. the risk forward feel markets But or we our tell soften. today growth that

Ronald Kamdem

Thanks much. so

Operator

Thank you.

from with is McGinniss Greg Please Scotiabank. with Our next question. proceed your question

Greg McGinniss

muted. Sorry. I was

Just points for development whether of from that additional couple potential and just Houston, that land $XX question you're future development inclusive for the the securing a again the of development of million if with cited acquisitions costs? talk area wanted and investment? for clarification. phases New and about Similar pipeline, development to transactions need Is there, Metro you first acquisition York

Nick Wibbenmeyer

Sure.

to all speaking costs. it's encompassing that's all New yes, So, York,

as build So be it to of would entirety. future property acquisition investment its cost the out the that as well in

encompassing So for the that all opportunity. that's future investment

Are I with happen? is, the the we opportunity. current make about were are. We asking then you don't comfortable to it. I phase believe Houston future sure And the the if I second phases want part understand

comfortable small opportunity we would if ultimately never owning an just is we purchase And so don't if building And be owning already we space will anticipate tremendous retail given that said, what its But the we we and is. an have are being building. do added. hopeful. expectation phases it we're comfortable have where as weren't future that they we scale But demand it and very purchased for

Greg McGinniss

Yes.

Houston, was saying the to for I need also if for whether the you're $XX you'll future acquire Sorry, carrying or additional million. land still that with phases

Nick Wibbenmeyer

property. Great control question. have adjacent we Yes over

part as property on focused this extended acquisition of that us so also for phases. future over it we're control gave And adjoining

So build this we're of on. control property going we do phases. I for for adjacent just acquisition over the future to portion property is Phase But the definitive have

Greg McGinniss

taking not here, where returns you're bit cash the already investments additional inherently to are – Okay. Great. with worthwhile risky development got make then And redevelopment. you mean that these said I than like you've risk targeted know the I versus more you that what on but the projects development little maybe be something Lisa flow. a have there's

curious be. just might returns what expected So

Nick Wibbenmeyer

great No Yes. question.

by As at I opportunity. really we opportunity said look before,

of ingoing what developments at we're we're are so believe comfortable with make yield. And definitely one sure looking future each is we analyzing of asset these we value the that to the

be will so an And X% return. Houston approximately at you to that asset developed example give an

our So transaction. data gives was point relates as you of eyesight one to that where that it

Greg McGinniss

I scarce growing the about least was for going Are me. potentially on QX was to the becomes that final developers And smaller access And one previously that just more forward? investments like initially the call at Great. lending these Okay. think type to? it a bank Lisa even referring capital. QX as opportunity does feel regarding call,

Nick Wibbenmeyer

continued the question. is Great would exactly us there the inverse for say mean opportunities. of that – it out creating are I I banking opportunities – challenges

mentioned we available capital offense. Lisa to a we desire have multiple As and have play has times,

is so They their very especially question. issue and no quality relationships some great capital are have And developers But that now contacts, capable. locally. there's right there out

that all place any we right lending. restricted capital it's most construction know now there's If is as

so bring of takes in have we expertise but just to some And figure ability not waiting and help goal step capital And many capital. only it these more over times line. bring relationships the to out than the and deals

the relates cost budgeting It figure expertise to restructuring cetera, dig well as effective does to as as take regarding out them, be it where with with in relationship deal et retailers potentially pricing, we can transactions.

at local are on developers very in we that wherever challenges projects engaged moment. have so And may hold help the fill to be these with the

Lisa Palmer

just And I said. think reiterate I a point really I that's just want Nick – that because to important that

Our or are developments a anchors especially relationships build it development that important they we lot and be this extremely drive that times grocery in perform. And with of driving underestimated know and to that the shouldn't that can is is also retailers us further. the our helping because pipeline like

Greg McGinniss

Okay. Thank you.

Operator

to further no floor back at are There Lisa for this closing over comments. questions you. the to Thank like I'd Palmer any time. hand

Lisa Palmer

interest with in weekend. all. us nice And today. Thank have Appreciate your being you a everyone

Operator

conference. This today's concludes

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

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