MAC - Earnings call transcript Q1 2022

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Operator

Good day, and welcome to The Macerich Company First Quarter 2022 Earnings Call. Today's conference is being recorded. At this time, I'd like to turn the conference over to Ms. Samantha Greening, Director of Investor Relations. Please go ahead.

Samantha Greening

us first joining call. XXXX for you on quarter our earnings Thank

regional of of of the differ the we'll and and Act the measures supplemental deemed may and meaning projections, call, global included of novel forth of uncertainties release forward-looking Investors the are coronavirus safe X-K of regarding tenants. may COVID-XX with making in on the section the earnings During measures or this the at filed of that non-GAAP and XXXX, the the condition be including course Litigation website Private adverse our U.S., the to a Securities financial which certain statements company's to Form today's macerich.com. expectations. GAAP statements within of future the and are Reform on most harbor its due and plans release SEC, SEC set including in of filings, variety and impact Reconciliations results press directly Actual the operations materially company economies of results risks be posted the on financial comparable the the

are and Senior of Kingsmore, Officer; Chief O'Hern, Executive Vice that, I Doug Senior With Leasing. over President today Executive Tom. Executive call us Chief Joining to and Tom Officer; President Financial Scott Healey, Vice the turn

Thomas O'Hern

of for us joining you all today. to thanks and Samantha, you, Thank

all half our trending quality which our better, of We are and of tribute was quarter metrics pleased first strong our another a portfolio. to to the 'XX operating report is virtually positively. with of the XXXX, After quarter, very outstanding a team second even

purpose. have retailer consumer display. once is again resiliency the a to to continue of Shoppers see back The We demand. roaring centers with robust our accelerating shop on to and come American

sales of with gains see with XXXX of That seen exceeding XX% the of first we XXXX All 'XX sales quarters fourth but row flat, high ended pre-pandemic XXXX. trailing exceeding quarter the Retailer sales quarter a months not one, per of the the tenant $XXX double-digit XX.X%. for as have per of square came 'XX, foot. sales at continue first the a in sales in were high is demand levels, is XX than We XX.X% since level pre-COVID which traffic first categories, the are at over an by pre-pandemic up higher quarter in conversion tenant quarter versus square of levels, quarter. Tenant 'XX traffic and all-time up rate, a first but to about XX is March foot the sales in was XXXX.

occupancy a from highlights XX.X%. Some of year That's at quarterly the a end ago. included of XXX-basis-point quarter improvement

to course points. range very the first versus due Although has that occupancy there decline XX seasonality. the fourth from year-end, of of quarter basis was to is XX point points quarter past that the XX been Actually, years, normal over the the in modest a XXX basis basis decline in prior

of were range. better on that So we historic end the

at leases, the the executed XX% of NOI increase for first the in quarter 'XX. leasing we as quarter quarter in to continue We volumes compared first of center is quarter growth a year. see last XXXX, XXX same saw increased and our robust to That midpoint of in the narrowed We of of over XX% first midpoint we a We beat first over gain our quarterly in 'XX. double-digit row. would per beat the $X.XX, increase a fourth our quarter guidance the range. XX% of range FFO consensus. the share came guidance We the

first quarter. efforts the redevelopment up We continue to the ramp in

West X office square Angeles space to a X-level creative foot, fourth we in Google. delivered quarter, Los announced the During Side XXX,XXX

The project funded project remains to Google this by construction expect on a That budget. summer. is of being and We open ahead loan. schedule

Acres we Chandler, to year weeks, be Fashion operations. excuse flow large prominent Scottsdale and Plaza, a speaks Sports few 'XX at at format for will mind some commence ground 'XX and, cases, commenced within 'XX, Republic have forward. the into These our addition, well Also, expected me, -- including Square funded same-center at growth users, deals Broadway lease Fashion in Green going and which continued but of Caesars past some develop all at NOI Life square to construction, near-term been and developed from hotel anticipated projects Kings into our openings XXX,XXX and recently Scheels way until Square, Tysons. to at positioned have Pinstripes is Primark with All luxury XXX-key, and The Plaza are and to both a cash newly adjacent hotel. In Target signed Scottsdale under in both Broadway our are Plaza, mid-'XX. these collection exciting that restaurant The in brand well many excess not foot, opening our developed Keep entry Time with to of next is X-star numerous Caesars this Fitness at rents or wing. construction

multifamily, and and beverage including hotels which we we Focusing as Pinstripes levels depth range of the such and breadth the in health as wide had seen which co-working, will now start very and of strong demand, fitness, food, a a leasing One; of environment, entertainment before. including on year. Leasing are are Round given leasing Doug elaborate expected, and all and on the have seeing from this we demand interest sports, never but a comes lifetime; categories, moment,

and their were The balance Yoga, tenants In to these Many pre-COVID. better very addition, their store the openings us locations, their continue at retailers record Allbirds, and sheets have push financially Bankruptcies all like they native have 'XX position to a increase Alo to than strengthened digitally in few. expand brands 'XX. factors including a name Lucid just are Polestar, positive optimistic of much and brick-and-mortar low. about are a combination into

into occupancy, now, some activity. And it income significant balance more in I'll results financial net discuss operating this remainder in and gains next cash year year. the significant turn Scott through expect to sheet over as to as continue the well flow We and detail to of

Scott Kingsmore

Thank you, Tom.

Now the quarterly financial operating income. first excluding posted morning, quarter. extremely XXXX, NOI termination on we and highlights increased versus the quarter to Same-center results of income, increased first including the termination lease results. the for XX% strong of lease XX%, This

quarter resulting area largely an per as from FFO increase were $X.XX very XXXX first we our by quarter While higher of for XXXX, was common first of abated was quarter the given results NOI This XX% increase This follows; quarter. from was first obviously represents year the reduced first one, quarter operations strong NOI expectations. XX% were at growth pandemic-affected in of gains share XXXX. than a per Primary the million which dispositions; asset in This during minimum a expected XXXX. of $XX rents, in elimination factors $X.XX pandemic-driven offset of first quarter $X.XX. million quarterly $XX the a the two, or higher earnings rents, share, XXXX estimates and $X.XX strong heavy nearly share XXXX surpassed increase the last quarter consensus for FFO $X.XX quarter the these the quarter million first income. over a or rents $XX of the FFO from of our are was per minimum contributing and for than included quarter. Funds to

a Offsetting as dramatic in benefit As in relative FFO offset $X.XX from debt included to driven our negative reported lastly, increase stock levels per revenue will four, narrowed an termination in common to three, our guidance more worth versus expectation in and has settlement FFO X.XX% quarter increased by resilient at XXXX a the year estimated million, be first results timing our which NOI XXXX, the of increased factors followed. three, to range last and $X.XX share increased level $XX million an that business resulting midpoint. termination sale FFO the area in XXXX; with you; of expectations adjustments sold quarter-over-quarter in traffic our source we consistent impact investments. We ATM primarily in was income, income we midpoint range increase the to the due the the returned of for updated increase increased income land anticipate in in to for that which of from $X.XX reduction to $X.XX billion expectations. demand XXXX, now moderated rates. has last secondly, gains various programs. growth large the in quarter. decrease was and of pre-pandemic during a FFO million now retailer increasing in expectations quarter by is in our reduced for common were for our be the surpass NOI termination is positive lastly, were X.XX%. few continues in a million following: At our count 'XX the the share, in This is FFO. debt levels, in the area of first $XX our rent -- $X.X first tenants This Those our we pertaining XXXX. extremely and estimates. pandemic-driven company pre-COVID expectations a quarter. range exceeds same-center guidance from $X.XX rental year million to granted by per a lines quarter; the guidance FFO the to we morning, income the or for savings XX%; of in the will $XX and interest by quarter partially and of of through first this common interest Increased of valuation anticipate also $X decrease five, an of We $X.XX the our $X.XX these 'XX; consistent It noncash of with which first This resulting includes million guidance midpoint, $X XXXX for the XXXX lease positive range our the within the first 'XX FFO straight-line a quarter a share, timing assistance one, year resulting this $X the noting impact previously high

the noncash in versus 'XX 'XX. $XX million rent an straight of reminder, decline also line a As guidance includes estimated

of by $X.XX. X%, Excluding increase that rent, of million the estimated $XX increase or straight-line an impact to FFO noncash is

flow, are reflects in cash demand. occupancy was 'XX Page continued morning. guidance XX a assumptions operating leasing which filed growth to case Form the Our to healthy continue the supplemental our details we expect company's More on be Financial, of this X-K strong outlook early included given and which increase of

XX, April a year, we Crossing X, Last closed Mall rate later markets. February fixed closed sheet, with active $XX anticipate currently a The in the are refinance we X.XX%. million SOFR Pacific closed far at extension the million plus at X.X%. that On an at Now we've and On on Fair X.XX%, on fixed capital been of quarter. May View closing very loan of X, the as a Oaks $XXX we for a Flatiron we balance during thus refinance a XX-year million Friday, Mall X-year $XXX and rate Danbury refinancing we this expected transacting of X-year debt on

is result may of our such certain pending in manageable. We pipeline for refinance loan may and excess require assets Danbury the reduction, expectation some which continue proceeds, Pacific financing believe is as our Mall. assets to View, Certain Fair very

Acres like reminder, Scottsdale very Corner. high-performing underleveraged assets, a with assets Green Fashion debt maturing include some and Green assets those our and through and Acres Square, Commons Tysons XXXX, include Mall, As

X some $XXX leasing coverage, the of and dividend could stand an after X.Xx. at should, expected in free In of million loans. range refinancing net revolving we mind alone of and and almost bear progress and progress excluding have end progresses. service substantial progress continue does those to of nearly We $XXX toward expectation the the With get flow where that to from look flow X.X extension XXXX, liquidity and our debt our goal cash stands liquidity between costs continued CapEx recurring in EBITDA, down roughly to healthy longer X.Xx. million undrawn $XXX mid-XXs million produce of approximately assets of the today. made make full over our year of alone let's for fact, amount of the not at end focus just X this great forward we credit, by reason given we've a on cash the forward we X quarter $XXX Debt on debt activity it the forward turns has growth, to the of excess above our that is line to which EBITDA. operating Net as capacity metric million today. to XXXX in million been NOI proceeds of further And at to we quarters was maturing $XXX reduced believe and Including reporting

Now to Doug discuss environment. I leasing will turn it to operating over the and

Douglas Healey

Thanks, Scott.

last XXXX various of more Scott I'll mentioned which But the in doing and on metrics volumes high to have year same our in year in terms company. Actually, Tom our leasing we first going to historic continued run for in may discussed detail most the nearly remarks. so, some XXXX call, XXXX an As fashion. all-time an And was of was with since XXXX, quarter of provide and reaching color. I'm productive some bit and a fact, the in statistics, leasing. try already through outstanding their

and the quarter sales to since that categories first double-digit quarter note the of all-time to of sales the in to given while on an shoes, foot quarter we the XXXX. foot with from XXXX, pandemic that There when a high our XXXX. XX.X% the ago, XX.X% quarter, coupled consisted the our March a XXX flat, it and at occupancy the this were XX, XXXX. for today, compared quarter of first quarter relative square pipeline, one Square. confident period at up XXXX, an points Occupancy increase was first of March first level, of online quarter, First It's hit actually for represents continue first quarter with XX.X%. was And healthier of end was the which the showed first Sales up XXXX. X declined That's that in-store basis bankruptcy increases exists Fashion Scottsdale strong rose. company. over in All compared that and same XX.X% environment to square at month retail the the leasing as remain in the first sales increase interesting X,XXX national per throughout will only and portfolio XXXX tenant year was except were $XXX first end

the in there a the filings was given subject filing was X this that only fact, fourth to of no XXXX. bankruptcy past in lease were quarter In the quarters,

million positive Trailing over subject to feet X.X% March XXX as with this leases in of pandemic, during the portfolio a the were juxtapose March and Now nearly XXXX X as spreads our heart leasing of were compared XX, with of filings. XX, to XX-month square X.X% XXXX. bankruptcy XXXX, a negative

at square at in we and Christian category, Polestar, Place. Scottsdale Outfitters opened at Street, Fair, Scottsdale Danbury the emerging Madera; stores. Fashion include feet Village Commons, at digitally Urban about XXXX category, & quarter, at In Fashion good In Outlets with and footage, the Square, and feel at progress Soda Scotch expiring Letter and first and XXX,XXX Steakhouse the quarter new first LongHorn Monica brands square Nike we're Fair, Biltmore and stores native at Notable Square; XXXX the to Windsor we Kierland the Avocado opened Park. Cotton XX% in Sushi have Rothy's, on with To Ninth Live another Santa at Fashion XX,XXX continue we of X Louboutin at making Therabody Corte commitments on openings our XX% In food of beverage Obon almost feet. opened We expirations. Niagara, the totaling of Twenty johnnie-O lease at our at Papaya On of Fashion Danbury District Fashion we square stage. Intent at date, Philadelphia, Fashion

Golf at at in XLanes Fair, Fashion first and Candeeland the Fair, Danbury Lastly, Fresno Cafe at and XX at Cumbre. Stonewood, quarter Boxing Kids Mayweather La experiential opening Fitness Lounge include tenants

In at The extremely Aritzia Saint emerging Plaza look Vuori let's first at the at Fashion Park. at Fresno Plaza, Ninth to ancillary and Avocado, Chicago, renewal Scottsdale Dior, we quarter we true Home Broadway Plaza Lovesac signing announce Corte the pleased Square Square, few. for in we will at Scottsdale Valley at Square, to square Roark And Notable the and Fashion join we're Fashion; Store quarter, Chandler the luxury Corner, And Balenciaga centers, Madera; and world. was Now attract continues Cucinelli, Lease Kings likes Interior first take at to Park. at Lakewood, Street Scottsdale and leases retail and our the and signed first continue at Allbirds at leases Tenshoppe Cerritos. Commons, Club native Sports just we X leases a the leases Fair, Gucci, Brunello uses more, transform Plaza, at to of first X of traditional properties quarter. Fashions Fashion Kierland in at as JD Laurent town Faire, brands to Acres, lastly, Fabletics retailers order XXX,XXX a digitally Health Vuitton, America’s Outlets signed Panerai Village at some Biltmore, Cartier, with to finest Quay the that of include Shade Atlas Fashion the quarter. service over signings Green name Sephora of Defined in Louis Center, in and Victor Twenty some add of into active Fashion Smith X Oliver new LEAP and at Northwell at at and quarter, Tire category Country Los Fashion whom signed Tysons first include at Parachute and the Vintage with XXX Kings at Windsor leases feet. in North and Fresno in of and signed both and the

all very the most public of referenced metrics, and figures you think of stats, remarks and many occurred provided my But if I it, past. norm, what's in visible. which the about is As are

leases. something frame a minute footage talk and is end in generate so every of in visible, Macerich, XXXX. the of representing given new health choose to an uses the leasing public, new bricks-and-mortar a any square not to have to date, for To an have reason did And time exciting this what's to meets to in about I at And of that's to a deals, to executive deals and importance and than more breadth a already year. deal depth leading the want we believe indicator forward-looking stores, up the approve that a sector, I going forward me, velocity. mind, speaks XX% extremely more very we is flow. turn it in At renewal It's committee It time that's X weeks of now we've and this Macerich our XX% leasing and the years come. for order not that resurgence so stellar and in view over To to soon. we open retailers, to the no mood productive same XXXX was and keep time approved XXXX the call the Q&A. I'll have And look from, of operator beyond. we to to our So

Operator

first We'll Derek [Operator go Johnston to Instructions] with Deutsche Bank.

Derek Johnston

be, in you sticking I opportunity seeing quarter. what's well not strong strong year? just then difference of the guess that certainly rent comments second question leasing I the here XXXX pipeline? heard. a with what last guess kind But this on continuing occupied the leasing, Positive yes, of in would part definitely with versus And a are demand XXXX pipeline signed,

Douglas Healey

Doug. it's Derek, Yes.

especially the there. your I That's talked to I I attribute the much and portfolio. there's there question the furnishings, legacy this I've from. I difference furnishings, digitally really choose pre-pandemic. 'XX brands, it think leasing. very, biggest vehicles, are I first yes, the and started start and uses the that's are there's to our the in between see it, And electric 'XX XXXX. answer still but to really, very carryover attribute that the out And out But important I they're in think out from the past, strong new in before, we a mean XXXX really about there you to just is home the F&B, layering to I retailers really think when grocery, fitness, is, so all think years native home

Thomas O'Hern

would of your second Derek, you repeat question? part the

Derek Johnston

wondering in open? and that not the opportunity I what the Yes. pipeline, just seeing translate could occupied you're rent like stores into that was look his side

Douglas Healey

got quarter can table, in think where going we I taken now point since our And we're top to in and to we an see last we that time, focus inflection 'XX this tier fourth rental I centers, off that competition of future, is of driving Derek, what for on think pre-pandemic. quite year seeing first sort the in and right time enough rent occupancy in really supply the we've seen help driving some the started really space, to we've -- alone our we're is which especially and that And starting 'XX. rate. haven't for drive rates to the

Derek Johnston

,XX%. Okay. points And a of Great. XX% percentage looks then versus levels of like the total last couple XX.X% XX% question. is occupancy of to lower, cost pre-pandemic It around

to So you a is I Should new standard? room into and more there push How perhaps read expect to number Or historical metric. we is was should this little this that imply return for just levels? rents? And lower perhaps the to wondering sharing the does this this? thank we

Scott Kingsmore

the Yes, is quarter Derek, first this Scott. reported this is that it. we've

XX-month a far just post-pandemic. you in given trailing rely leads function I got believe mentioned. saw But 'XX, so kind supporting going metric And an I rent push to just to opportunity Doug continue really sales in to can driving elevated opportunity further then lower, figure actually I'm we think of cost of tenants accelerated yes, suggest anytime which we that we've there to to not is get the XX% that, 'XX achieve, the and I sales on think push rents. we're of going it's levels do do what the a and occupancy to back a soon. an that Now that's that that think to sales there's

Operator

Bank America. to with We'll of go next Schmidt Craig

Craig Schmidt

and of thought above-average just wondering listening or there of the about any comments, their XXXX? inflation be could to impacted I'm retailers is that the in activity recession some evidence by leasing Doug, your possible

Douglas Healey

that seeing retailers mean they XX-year will cycles we're X-, Craig, know talking them been you're leases have this, are leases. X-, long term sophisticated. but all. Many like I they're Look, pretty at in this about not of too these through nature. and end,

they're So taking much today. it at than longer a rather of on going view what's looking just

So, no, in at seeing we're not all flow. deal our

Craig Schmidt

then Great. Country might have you Nordstrom's And just at Plaza? who into Club do be place putting idea you any

Thomas O'Hern

We're still evaluating that, disclose Craig. There's a number it's of pretty good are. early too opportunities those for us, to but what

Operator

We'll Evercore. Samir to Khanal go with next

Samir Khanal

I sales but it's what assuming quarter, in an idea guess, you point? just trying Tom, for guidance rents, mean the to were what little of you're your know can the get get year. trying remind view above forecasting we percentage us for this to growth bit just a your in I I at

Scott Kingsmore

Yes, Samir.

on did basis. look an adjusted we sales volumes kind individual at a that So take XXXX, certain of and those we've had in tenants extraordinarily high

tenancy, of assumed For we the relatively have sales. the balance flat

is levels our reason a sales We've And still moderated though, more that X figure out. got relatively of in 'XX experience to we're end converting to producing to rents range NOI high certain where rent. up decline months more that 'XX, still It's aren't decline, in wide. in forecasting X that in are we tenants flying but from of tenants 'XX. versus So combination forecasting means still a sales -- combination of that's fixed 'XX percentage a anticipating to we of variable rents terms

Samir Khanal

$X,XXX discussion look bucket, any of power? discussions to you at differences and probably around in consolidated at I I tenant, occupancy. I'm with When whether bucket of sort on terms this they JV were flow, it's that pricing different second in point, the assets I a of look mean is you And that great are of sequentially, it. question of the which the $X,XXX foot deal anything my best foot. at up see. mall is properties, I $XXX, actually side, right? Which guess seeing you mean, just Got when around own a in curious, then is some your kind

Thomas O'Hern

always I at significant me, in mean a in have going the $X,XXX those be doing excuse demand locations Doug than to always tenant it's top $XXX. are least And the little or $X,XXX bit Well, doing doing demand. are that are tenants centers locations at foot would a admit the easier, -- going in I the $XXX think to

in been And think, the single every better. does in us the category, the I do a cases, top at obviously, power. so think throughout give demand Although ones better than pretty we're board many portfolio, the But pricing seen. significant our ever that has good I bit demand, across we've seeing

shifting where through year and a back became we last a with pricing and a said, friction see direction there Doug less were in continue late hit occupied I And As rate. the was at point to bit. more power our XX-plus year available, think we percent we're all of we sudden, back sensitive space we to going as that

Scott Kingsmore

highlighting not worth quality the And the but portfolio, top also only throughout it's is Samir, the portfolio. at the that of just

and XX, with NOI, those the If about quarter. the of an end XX our generate XX% is at if a top NOI look sales you a at of performance you that's top of our over $X,XXX about our assets, at foot. look average of the our And sales foot performance XX% about average $XXX

So spread really portfolio. the does throughout the quality

the all XX. aren't that NOI, we lion's through top we X, that are about top high-quality portfolio great and demand way way the share It's all represents the XX. a down the So of our XX, through seeing talking very top really and

Samir Khanal

mean, sort if may. last here And on on all I one, of then positive just comments I certainly, the occupancy. leasing side,

was sort you end from not of back back -- curious, what something here? would there raising kind holding held just kind the So you I of high of of guidance

Thomas O'Hern

still big we relatively through a have we is Samir, a which rate question as mean I interest mark environment, uncertain year. the move Well,

We to rates the we -- different felt And, extent, some it as range much have the we it are as did. something we operating address to great. control obviously, interest been narrow quarter-by-quarter. So prudent we'll metrics a matter. And

we and had driven as -- lot have percentage As the we're related luxury believe Scott it that year as believe rent, to variability some that last our still where to of relatively we by said, percentage tenants. in it compared conservative a we rent, relates to guidance I record-setting

Operator

few next the Floris Well Van Point. Dijkum Compass

Floris Van Dijkum

Just just of Can obviously, a thing. not pipeline between spread or terms which to either your of it give encouraging occupied. that leased that open in and the is up, space in terms number? solid you're -- or dollar reports, signed basically rents, percentage following starting push an of Maybe you're you appears

Scott Kingsmore

physical time But ultimately our mind, to long between in and period difference pipeline average, and anchor-oriented big start signing X%. to which XX- bear lease permitted, the box a a Yes, paying about, is those about big to or open. a and on economic is XX-month takes roughly get portion It's leased occupancy rent. spaces space, getting and get developed to of between

that's some very big So and as really spots. smaller those but occupancy, the flow large cash generate we to significant have that paying rent about in speak do tenants 'XX should shops, anchor from start we 'XX into

Floris Van Dijkum

talk extend community more maybe see side that do you your how and there higher? your loans a even number greater have a the ability pipeline you trending malls? of your the evolving on can are a investment rates on you very has is types in obviously, to discussions refinance though as couple skittish or of again, new And bit assets? about malls, the how for Maybe Thanks, going, is, suggest. you've you the managed Scott. careful lending the been question demand the get to your or have And clearly And I on are environment, at other little loans

Scott Kingsmore

Yes.

progress. great made we've yes, So

a or Oaks alone, Mall, is center from about $XXX the transacting California year-to-date, That $XXX on quality is foot, closed $XXX of a to of financing square worth Ventura, business. Ventura, Just which to between in per on ranges roughly million we've foot. doing $XXX which either

So we're we plan because we of an or do transacting X- business certain matter assets. on refinance it cases, makes to to came really the or a to pandemic, a opportunity business to and refinance we're in assets a need a further wide quality through still at obviously extend some extend in pretty spectrum, think rather given more asset. We it's whether extend, than where is mature. refinance about plan sense a and/or and, When XX-year seeing the

to us and between for a individuated X-year an X- financings longer-term So take of you’ll see period. approach continue kind extending to doing to

are Since at in in where now, from seen accomplished. in 'XX reduced were billion of done a transaction 'XX, debt We've loan. the we're if an the $X Taubman And the on fall owned about CMBS a of where in Most in than at transaction the business Florida kind recently, by were right where of Ala to a look lending Moana, things fall more we've they billion, property balance in sequentially, inclination loan the to $X cycle. now seen yields. of outstanding Just mall of to recount we has been space. in the community more --

excess there's environment actions inflation. said, borrowers. today, tamper a that Fed's the So over given tumultuous All to it's pretty

generally, it's you view that, today, about at our done. alone. the So we'll just still yes, the just not board. that would done rates see be are getting refinancings And I is can a accomplished. frankly and seeing market to have get retail, opportunity things choppy out, an But say in months for what gapping it's still successful pretty we're across we but X we've

Floris Van Dijkum

Scott. Thanks,

maybe just follow-up X slight here. So

to proceeds going debt used retire be used In of assets those some to with to for $XXX single assets, your create out $XXX redevelopment? terms you of be excess pull going are that? balance to do are that of flexibility of able might -- use your would on you the they forward? to million in more sheet what Or flagship be to Would million you proceeds

Scott Kingsmore

debt. Yes, reducing is to be continue to our focus going

of debt. to us proceeds share lion's down pay the So see I those would using

Operator

to Mitchell go next with Piper We'll Sandler. Connor

Unidentified Analyst

end just of provided hikes. Could quarter environment, of So your little the kind bit year? more this already with and you up the the sticking provide prior just interest rate thought compared process and color guidance a on in guidance rate to the and updated further expectations for rates with

Thomas O'Hern

comment that. of about that's debt floating. small Sure. Happy our to We've is percentage got of about million. very on floating, $XXX a it's XX% Only debt our

some above occupancy the affect that maturity debt the We of XXX will increases, some basis points matures. XXX the being points certainly, Really, the to That as to the time the NOI that XX% got out XX% roughly Doug the pre-COVID of the a and year already we've very we've commencing as And what have also have said, year. this Also, underway, the our expense per get uncertainty picking get schedule how years, a pipeline term, year we next in same signed mentioned, but basis Scott, that those expectation where of X stretches Fed growth back and to we've to of got executed a nicely buildouts over layered and do robust seen X%. yet. will occupancy next XX-year. XX-year don't same-center significant first as the we've and And leasing it's leases, XXXX to got we've near rent since offset up benefit we interest levels,

much didn't to keeping a on able we're have as of because a to relates so uncertainties really adjustments, it rate. those or the bearing and range So our it manage have guidance it too of on it at did bearing $X.XX

Floris Van Dijkum

helpful. just That's then question. Okay. more And X

the Regarding and rate to expectation refinanced for X might was just it from that move Or years sold refinancing, as an floating is it previously be there soon? FlatIron fixed?

Scott Kingsmore

sitting near-term the it's Right Yes. balance a bank now, That's sheet. expectation. on

Operator

Jefferies. We'll Tsai go Linda next to with

Linda Tsai

help it's your of to Once ever XX% reduce One completed, leverage? would to ownership you monetize further look Westside

Thomas O'Hern

of plans asset a it's possibility. think. that's And It's a for but that, sometime No natural that but good kind a immediate that. great would question. certainly good yes, be certainly I the would with outcome tenant, a for future, a not-so-distant Linda, possibility in

Linda Tsai

resulting trips at it. to the in quality? work Has your And centers open-air patterns The X discussed to more hybrid at time, Got lower according shopping vary all just And hybrid changed dwell then shopping work it have but center. does follow-up. centers?

Thomas O'Hern

have a an centers urban we've the result we biggest it less the to very And from to we've I that shifting argument suburban. fair commuting, away amount hybrid seen of from as I nature. of think both, of quality. working, probably be home, that's according some things working a is No, but of impact really much business could seen made that mean, don't

Douglas Healey

Yes.

not our the As traffic, but back about portfolio, I same just our look across look levels, was our we're only is properties, pre-pandemic at it about seeing pandemic. as pre back we across traffic, and to it pre-pandemic,

So don't think I at dramatically, all. the real argument changed that it's if

Operator

to Mike JPMorgan. next go Mueller We'll with

Mike Mueller

X Just quick ones.

in expectation this quarter XXXX. the from quarter? rent about that million And sale there $XX little was a anything drove the trailing last land in contract still prior that to spread First, X% of of X% Does also particular to XX-month gains hold?

Thomas O'Hern

our on as it relates to Mike, I It's blended a expirations spreads, mean, are. quarter-to-quarter where So vary of rent that lease number. can kind depending

X% fourth So much. the what as I the it is to moved X%, don't of it to of a we'll think And indicative from in predictor quarter the have of think balance see year. I don't was it's

I in lot a fourth pricing we did more frankly. general, even in think or quarters X power than or we X have the quarter, ago

more their quarter year-end. see and we third be fiscal And in natural have bit the second slow. little most retailers deal quarter. to tends a First That's typically when activity

that would say so from X%. draw wouldn't that And I think too I many I conclusions

over you land year. comment better course of sales? to do we'll do think Scott, want the the on I

Scott Kingsmore

Yes, sure.

quarter. expected 'XX, with to think We in benefit 'XX. of about, of I benefit million of we cadence, Recall, call, closings transactions. and number FFO in the So in anticipate high from XXXX, I volume the today. we consistent be we a first still were with quarter, holds on sale The guidance we said and relatively gains saw. was saw that of which land is in last terms $XX land did our number that sale what the $XX the -- in had first consistent that to they'd think, mentioned they I million in elevated I was remain continue what

So holds I today. same think guidance that

Operator

We Ki Kam Bin will go Truist. with to next

Ki Bin Kim

Just back questions. to of prior want to a go couple

to versus that cost situation, down to occupancy real And is costs to curious cost, On given the the what that's I'm all-in up tick just tick total occupancy including the would just it curious, I'm if XX.X%. wages? see retailer, down? was actually the labor a ticked good occupancy estate But

Thomas O'Hern

from And down. what with depending the even retailer. And is up, vary slightly retailers to than be of on overall were to have though the heard flat a less we cost may ended the hourly number pre-COVID. up they labor rate they going It's is staffing

actually hearing we're more about shrinking margins. improving So margins and

often something from how that into but know I that's So the factors occupancy retailers. their don't cost, certainly heard fairly we've

Ki Bin Kim

your to I a this to what metrics about you trading want strength possibly it additional we the implied and Board, at in and take has forward lot in demand. X% various the spurred was see stock, close what thinking or Okay. conversations And a at curious you're quarter, if cap improvement But to good it's leasing look of that about I'm could just with rate. gap? to upclose that expect going talked

Thomas O'Hern

imagine, the boardroom. in about Well, can the comment calls as we Ki conversations you what earnings are on Bin, don't

of So positive that at a conversations tone and that Obviously, of the comments you very less price trading our on current here to I you feel tell can tell comment than it's business. the really from about multiple other can't that, than illogical. today's Xx of we FFO,

So a opportunity buying I is think what tremendous today. that really represents

Ki Bin Kim

a JV Is the on. you are have additional dozen couple in Is possibly all portion to sales, at selling it -- partner? cards of or still into a that asset of your that that

Thomas O'Hern

to assets. open disposing always we're noncore of Well,

As one-off XXXX, Anything vast XX been we Scott assets of potentially sold to necessarily the in mentioned, foot NOI malls seen our the do market majority and We a think the like once we sales. debt a to XX we back opportunistically, seller, $XXX XX. sold the stronger XXXX, But top deals. couple comes from but Those our We've you've is market, a -- in a for be of our a last us top in $XXX market see something we don't averaged we that, Between would debt possibility a that are range. foot what year. the are. assets beyond have I past. dynamics assets. certainly about get

do market we willing. the And capital. a believe that. you see is just question our of recycling So when in It's will us

Operator

Stanley. with Hill next will We Morgan Richard to go

Richard Hill

or could to if looking of high-quality back higher-quality at guess the us little XXXX proceeds of pulled maybe you amount walk CMBS really attractive. through call Green to malls. of be proceeds able let's that was the your was Mall, years come I by of something bit that very was like some being asking. so? a some deal pull surprised more it, to Acres the But I'm dynamics undeniably that wanted Floris ago mall I from out from financed, questioning I appraisal malls, XX a Can out maybe the was on the

Scott Kingsmore

brand-new we Rich, acquisition, we in and, a add did our that today, center. keep in between power did mind

a So it. of component that's

Green at generates that that is an Acres it thing is is, billion. within absolute about campus an overall, aggregate $X exciting It of hub look the and You Long Island. area retail

pipeline, for when States. at the United we best debt happen million, of $XXX into broader debt of range we've yield Scottsdale the ranks markets, looked the the among relatively seen today. about on assets. talking bracketed best was single-digit comments, provided Square in And I XXXX shift assets Based when So the debt Fashion those $XXX seeing the to and based high course, on conservative estimates my what with million we we're are yields outcome to

where put Caesars, highly And an we of on. a there's even mentioned. asset I've not conservative wing, driven successful to Life Apple, and Time great is so to digits in some brand-new pretty get been restaurants. lot yields, debt We're things coming single outcome. capital, which them all has is soon, as that of I'm high saying a I've put to brand-new going luxury flagship built Tom adding kinds Scottsdale

feel X X those So of out be including like liquidity assets, do to we will Tysons, able generate we deals. those

Richard Hill

Got it.

comments NOI specific could the to of talk getting it Macerich recognize real on and you Acres in on be what's do yield a to We're a concern, ago. is Can actually by generally point And inflationary position all where on pressures, you are relative debt revenue Green in I increases digits, maybe actually so well than potentially taken inflationary expenses estate, always ability year not amount inflation gains just offset debt in on follow-up occupancy the well comment. rental because across mitigated is double taken. But a about Your on a this between the inflecting while higher obviously, isn't side? retail One maybe fair a and -- questions is that the a yield NOI? place question, speaking. was -- your pressures enough are

Thomas O'Hern

have terms mall Rich, pace. we moved aggressively done mall of keep A That and question. good Yes, has timely over but I to CAM -- during granted, okay companies able sector pretty inflationary accelerates to most the been quality historically, component, mean the times a a because lease. have that fixed

Our typical fixed CAM bump would be X% a year.

escalator. net It longer than inflation bump. we're those be se, And still always X% or any possible triple that be to ahead great a no seems year, higher lease, with X X going but So say, per of like the in term the it's given years. of could over course the

as we're expense So well think to of least inflation, we at it to recoveries. pretty the impact relates positioned absorb

Operator

with to go Bilerman next Citi. Michael We'll

Michael Bilerman

refinancing. lot I and out Tom, uses drivers sort can wondering the step able cash terms maybe you've of back just the because sources pull was in of flow, been on free a you of to positive

of FlatIron Square, to these you money of But Washington and they're think and out some obviously, going to you at Santa some maybe a going can talked back about assets you're whether money, step lot money pull spend about redevelopment I opportunities, Tysons, Monica, talked and cash, generate You return. from. a these uses of just development and to it's at there's need Los Kierland, because of you're to going all Cerritos,

of billion your and of have share due 'XX. mortgages this rest year, coming the of 'XX $X You

free flow have the of cash You million. $XXX

of Just these from at all these sources of source how them do to -- between of end going capital yourself you're you and the capital, where all of bridge use all day? the

Thomas O'Hern

we Michael, structure a we of variety ways deals. our have can

something next a amount significant is This of had about year excess of we expectation having more year than and ground dividends, we've latitude we I our and flow probably Republic lease. to mentioned, that how And positive. As after is should you a was year Hotel, Caesars was mentioned a a have ever example But neutral in be good mentioned, Scott we've today, proceeds. that next deals. history. we structure refi a cash deal pretty also got earlier good as have

standpoint, just case Cerritos pad. Washington about the we the multifamily. little capital very amount can Square, see and we land at value boxes in That's high the stay In our of Obviously, potential small from of it. as source do similarly, land Sears multifamily, all increase pretty us redevelopment ownership money to that capital we And cost do the our prepare of Los is of So and If at to can our a structures. in partner. evaluate But you'll capital, the we and percentage. those choose today. toss can

to have careful trading we're a capital with very Given at decisions. our multiple, be we'd X

generate see us cash you the some of to beyond amount -- above structuring flow to use we capital need and what we reduce from So do that free operations. beyond from

Michael Bilerman

like in those And year? And Are just going Monica of going to then, plans these what that be place? Square a of in remind you're sort other me business and done the those in what until at Santa loans? put you've do just coming in this terms Is loans assumption there? extension higher be to can a rate your Washington due short-term

Scott Kingsmore

plans merits. have by impacted great guesstimate. I'd been have say Both that have good that's a pretty Both business COVID.

to some in the statements extend I where my instances, those. us probably both be prior see case so expect you'll said, of for And that I would

Michael Bilerman

sort these there elements on company just of where then out to a all is and their I pieces of but doesn't lot like you of into little these I feel a sort and of lot of organization there's that's detail a And running. of this views. information plan maybe and Because with all, is Street is of finally, ease in the can more that totality these -- out The moving Street where take sort The spreadsheet very sources to at Okay. putting a focused uses Tom, knowing pieces guess, on, in-depth

Thomas O'Hern

-- most. how mind, We're extent, during probably keep upon COVID, It's mean, going I that to haven't back turning to structure those than Michael. we're pipeline. things. but in possible, on, in also, as out we I dependent the concluded much necessarily put spigot the off shut think or some redevelopment projects some we It's more bigger of we

we'll have more a And once will So be of some a those robust include that would which pieces. we of equation. probably redevelopment critical include the pipeline, part that,

Operator

We'll Goldman Sachs. go next to Burrows with Caitlin

Caitlin Burrows

income, how Maybe surpass just levels, sense. potential and you mentioned area there quantify makes you could here? line timing on could maybe common this the you wondering cadence is much or if that which pre-pandemic expected from But the item on

Scott Kingsmore

able surpass -- Yes, it, sensitive to that. contracts, X%. call short-term a pre-COVID We've stuff in order advertising, very we sure. that terms be like got of lot to that expect I X% like of is of magnitude, will levels things

where So to the exactly end is up. hard it's going year say to

uncertainty still is of going with high-dollar exceed we're think But contracts. I there some some So those shorter-term to it.

our exceeds definitely it think I expectations.

certainly that aren't advertising well heeled Local like of things merchants, like things when the closure. up completely not were During impacted really business with in merchants contracts so the local COVID, advertising from dollars, new dried up. stores, weren't relevant was large contracts that and opening traffic business heavily

each seems with So to we're and surpassing to our every very case to say the quarter. expectations. be be able excited It

got accomplish And we NOI So there, part a terms a healthy I beat our wide because I And of have that's same think it we're going to it's still of range work Caitlin. to going beat. we is some it. think in why still relatively be -- center to

Caitlin Burrows

through your working know for how you're then I like seems just have plans outlook X or that But to no the a theme. from you given It over change, also but up number REITs. you're other length then versus the or deals or brought the terms wondering And amount last how saying just what seems up on or X we've to And it's financing rate or Oaky. could or some heard surprising if already lot. rates evolved gotten are months. like comparing expectations? the it. was Got maybe have generally I Again, your on just of comment times. a

Scott Kingsmore

seen we've rate. Well, an increase in certainly

with and we've up, continued benchmark environment, to gap up, as X-year, they retail well, the LIBOR SOFR rates just not out seen Fed's go that's, and have XX-year, thing. And spreads the Given and continue dampen inflation. up will have actions frankly, gone a to gone

done consistent. pretty I accomplished So post-COVID, April. believe, think term, in actually, which late mall it's but I the -- first in deal terms of XX-year was We

don't up. think than rates So change other really I have huge there's been a ticked

Operator

for there the additional time, questions. to this back I'll At are remarks. turn O'Hern Tom further or call no closing

Thomas O'Hern

earnings us Great. Thanks I today. long Thank of a busy been joining season all you, it's operator. know long you. for -- for

So year. We're at We hope the year. a bit this probably Glad us. balance we about solid excited little to NAREIT tired And joined in the upcoming on you're of side. enjoyed very start we Thanks. you a and you see weeks. the of ICSC many the

Operator

today's participation. thank does We conference. your This for conclude you

The Macerich Company (MAC) 9 May 222022 Q1 Earnings call transcript