Orion Properties Inc (ONL) 2023 Q3 法說會逐字稿

Greetings. Welcome to Orion Office REIT's Third Quarter 2023 Earnings Call. As a reminder, this conference is being recorded. I would now like to turn the call over to Paul Hughes, General Counsel for Orion. Thank you. You may begin.

問候。歡迎參加 Orion Office REIT 的 2023 年第三季財報電話會議。提醒一下，本次會議正在錄製中。我現在想將電話轉給 Orion 總法律顧問 Paul Hughes。謝謝。你可以開始了。

Thank you. Good morning, everyone. Yesterday, Orion released its financial results for the quarter ended September 30, 2023, filed its Form 10-Q with the Securities and Exchange Commission and posted its earnings supplement to its website. These documents are available in the Investors section of the company's website at onlreit.com.

謝謝。大家，早安。昨天，Orion 發布了截至 2023 年 9 月 30 日的季度財務業績，向美國證券交易委員會提交了 10-Q 表格，並在其網站上發布了收益補充報告。這些文件可在公司網站 onlreit.com 的投資者部分取得。

Certain statements made during this call are not strictly historical information and constitute forward-looking statements. These statements, which include the company's guidance estimates for calendar year 2023 are based on management's current expectations and are subject to a number of risks that could cause actual results to differ materially from our estimates. The risks are discussed in our earnings release as well as in our Form 10-Q and other SEC filings. The company undertakes no duty to update any forward-looking statements made during this call.

本次電話會議中所做的某些陳述並非嚴格的歷史訊息，而是構成前瞻性陳述。這些陳述（包括公司對 2023 日曆年的指導估計）是基於管理層當前的預期，並面臨許多風險，可能導致實際結果與我們的估計有重大差異。我們的收益報告以及 10-Q 表格和其他 SEC 文件中討論了這些風險。本公司不承擔更新本次電話會議期間所做的任何前瞻性陳述的責任。

Additionally, during the conference call today, we will be discussing certain non-GAAP financial measures, such as funds from operations, or FFO, and core funds from operations or core FFO. The company's earnings release and supplement include a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP measure. Our presentation of this information is not a substitute for the financial information presented in accordance with GAAP.

此外，在今天的電話會議上，我們將討論某些非 GAAP 財務指標，例如來自營運的資金（FFO）以及來自營運的核心資金或核心 FFO。該公司的收益發布和補充包括這些非公認會計原則財務指標與最直接可比較的公認會計原則指標的調節。我們提供的此資訊不能取代根據 GAAP 提供的財務資訊。

Hosting the call today are Paul McDowell, the company's Chief Executive Officer; and Gavin Brandon, the company's Chief Financial Officer. And joining us for the Q&A session are Gary Landriau, our Chief Investment Officer; and Chris Day, our Chief Operating Officer.

今天主持電話會議的是該公司執行長 Paul McDowell；以及該公司財務長加文·布蘭登(Gavin Brandon)。我們的首席投資長 Gary Landriau 也加入了我們的問答環節；以及我們的營運長 Chris Day。

With that, I am now going to turn the call over to Paul McDowell. Paul?

現在，我將把電話轉給保羅·麥克道爾。保羅？

Good morning, everyone, and welcome to Orion Office REIT's Third Quarter 2023 Earnings Call. On behalf of our team, I want to thank you all for joining us today. I will discuss our portfolio, performance and operations for the third quarter and highlight our ongoing progress in executing our business strategy of owning a diversified portfolio of high-quality office properties leased primarily on a single-tenant net lease basis in markets across the United States. I will then turn the call over to Gavin to provide an update on our financial results and on our outlook for the rest of the year.

大家早安，歡迎參加 Orion Office REIT 的 2023 年第三季財報電話會議。我謹代表我們的團隊感謝大家今天加入我們。我將討論我們第三季的投資組合、業績和營運情況，並重點介紹我們在執行業務策略方面取得的持續進展，即擁有主要在美國市場上以單一租戶淨租賃為基礎租賃的多元化優質辦公物業組合。 。然後我會將電話轉給加文，提供有關我們財務業績和今年剩餘時間前景的最新資訊。

At quarter end, we owned 79 properties and 6 unconsolidated joint venture properties, comprising 9.5 million rentable square feet that were 80.5% occupied. Adjusted for properties that have been sold subsequent to quarter end or currently under agreement to be sold, our occupancy rate was 88.7% as of September 30, 2023. The properties in the portfolio are predominantly either triple or double net leased to creditworthy tenants. As a percentage of annualized base rent as of September 30, 2023, 72% of our tenants were investment grade, up from 69.9% as of September 30, 2022.

截至季末，我們擁有 79 處房產和 6 處未合併的合資房產，包括 950 萬平方英尺的可出租面積，入住率為 80.5%。截至 2023 年 9 月 30 日，對季度末後已出售或目前根據協議出售的房產進行調整後，我們的入住率為 88.7%。投資組合中的房產主要是三重或雙重淨租賃給信譽良好的租戶。截至 2023 年 9 月 30 日，我們的 72% 的租戶屬於投資等級，佔年化基本租金的百分比，高於截至 2022 年 9 月 30 日的 69.9%。

Our strong portfolio of assets is well diversified by tenant, tenant industry and geography. Our largest tenant by annualized base rent is the United States government, and our 2 largest tenant industries are health care and government, representing 14.7% and 13.7% of annualized base rent, respectively. Over 30% of our annualized base rent is derived from Sunbelt markets. Our largest markets by state remain Texas and New Jersey, which represents 16.7% and 13.2% of annualized base rent, respectively. Our portfolio's weighted average lease term stayed steady at 3.9 years at quarter end.

我們強大的資產組合根據租戶、租戶行業和地理位置實現了多元化。以年化基本租金計算，我們最大的租戶是美國政府，我們最大的兩個租戶產業是醫療保健和政府，分別佔年化基本租金的 14.7% 和 13.7%。我們超過 30% 的年化基本租金來自 Sunbelt 市場。按州劃分，我們最大的市場仍然是德州和新澤西州，分別佔年化基本租金的 16.7% 和 13.2%。截至季末，我們投資組合的加權平均租賃期間穩定在 3.9 年。

Maintaining a strong capital structure that can support the necessary investments in our core portfolio is a critical part of our business plan beyond being proactive in our approach to new and renewal leasing. Carefully balancing our leverage, asset sales and capital investment is the right strategy since we cannot control the macro environment or the financial climate for the office sector, which continues to be very difficult. To that point, the continued negative sentiment has certainly weighed on valuation for not just Orion, but also the entire office and net lease sectors. In September, we learned that Orion would transition out of certain stock indexes, resulting in a significant temporary spike in trading volumes and added selling pressure on our shares as investors rotated out of their ownership positions.

除了積極主動地進行新租賃和續租租賃之外，維持強大的資本結構以支持我們核心投資組合的必要投資是我們業務計劃的重要組成部分。謹慎平衡我們的槓桿、資產出售和資本投資是正確的策略，因為我們無法控製辦公室產業的宏觀環境或金融環境，而這仍然非常困難。就這一點而言，持續的負面情緒肯定不僅影響了 Orion 的估值，還影響了整個辦公室和淨租賃行業的估值。 9 月份，我們獲悉 Orion 將退出某些股票指數，導致交易量暫時大幅飆升，並隨著投資者退出其所有權頭寸而增加了我們股票的拋售壓力。

Given the dislocation, we executed a repurchase of 900,000 shares of our common stock for $5 million at a weighted average price of $5.46 per share as part of the company's previously announced $50 million share repurchase program. Beyond that investment, we continue to prioritize current and expected future capital spend for building improvement allowances and lease incentives to retain and attract new tenants and enable us to maintain and extend our existing portfolio's weighted average lease term to drive sustained cash flows.

鑑於這種混亂，我們以 500 萬美元的價格以每股 5.46 美元的加權平均價格回購了 90 萬股普通股，這是該公司先前宣布的 5,000 萬美元股票回購計劃的一部分。除此之外，我們繼續優先考慮當前和預期的未來資本支出，用於建築改善津貼和租賃激勵措施，以保留和吸引新租戶，並使我們能夠維持和延長現有投資組合的加權平均租賃期限，以推動持續的現金流。

We spend a significant amount of time on capital allocation decisions and remain guided by ascertaining which properties will provide the greatest return over time. We still believe that the best use of our capital is to continue to stabilize and reposition the existing portfolio and recycle capital as appropriate through the sale of properties that do not align with our long-term strategy.

我們花費大量時間進行資本配置決策，並始終以確定哪些房產將隨著時間的推移提供最大回報為指導。我們仍然相信，資本的最佳用途是繼續穩定和重新定位現有投資組合，並透過出售不符合我們長期策略的房產來適當回收資本。

During the third quarter and shortly thereafter, we closed on the sale of 3 vacant properties, representing 452,000 square feet for an aggregate gross sales price of $15.4 million or $34 per square foot. We also have agreements to sell 9 additional properties representing 779,000 square feet for approximately $47 million. Regarding the 6-property former Walgreens campus in Deerfield, Illinois, that we have had under contract to sell for the past several quarters, the buyer continues to progress with its redevelopment plans for the property despite the challenging financing environment, and has reached an additional milestone, therefore, adding to their at-risk deposit towards the purchase price. We are now targeting this sale to close sometime in mid-2024.

在第三季及此後不久，我們完成了 3 處空置房產的銷售，面積為 452,000 平方英尺，總銷售價格為 1540 萬美元或每平方英尺 34 美元。我們還協議以約 4,700 萬美元的價格出售另外 9 處房產，面積為 779,000 平方英尺。關於位於伊利諾伊州迪爾菲爾德的6 處房產的前沃爾格林園區，我們在過去幾個季度簽訂了出售合同，儘管融資環境充滿挑戰，但買方仍在繼續推進該房產的重建計劃，並已達成額外的協議因此，里程碑，將他們的風險存款增加到購買價格。我們現在的目標是在 2024 年中期的某個時間完成這項銷售。

The reason it is so important to execute on these sales of vacant and noncore assets is the costs that are associated with maintaining a vacant building where retenanting opportunities over the near to intermediate term appear unlikely. Through the 9 months ended September 30, 2023, we estimate that we have spent $8.2 million in carrying costs on vacant and partially vacant properties, as shown on Page 18 of the supplemental. As we have said before, while asset sales reduced operating expense drag in the short term, it will pressure our ability to grow earnings in the future as we become smaller with fewer buildings. That said, we believe that in this environment, it is the right approach to maximize the long-term value of the overall portfolio and position the company to grow profitably in the future.

執行這些空置和非核心資產的出售如此重要的原因是與維護空置建築相關的成本，而空置建築在中短期內似乎不太可能有重新出租的機會。截至 2023 年 9 月 30 日的 9 個月中，我們估計我們已花費 820 萬美元用於空置和部分空置房產的持有成本，如補充資料第 18 頁所示。正如我們之前所說，雖然資產出售在短期內減少了營運費用的拖累，但隨著我們規模的縮小和建築物的減少，這將給我們未來成長獲利的能力帶來壓力。也就是說，我們相信在這種環境下，最大化整體投資組合的長期價值並使公司在未來實現獲利成長是正確的方法。

Leasing continues to be challenging, and we did not sign any leases during the third quarter despite decent activity. However, in October, we secured a 10-year early lease renewal for approximately 90,000 square feet in Memphis, Tennessee, where the investment-grade tenants lease term will now run until December 31, 2034.

租賃仍然面臨挑戰，儘管活動不錯，但我們在第三季沒有簽署任何租賃合約。然而，10 月份，我們在田納西州孟菲斯獲得了約 90,000 平方英尺的提前 10 年租約續約，投資級租戶的租期將持續至 2034 年 12 月 31 日。

We also entered into a new 10-year lease for approximately 3,000 square feet of retail space on the ground floor in our building in Covington, Kentucky, leased primarily to the United States of America. From an office sentiment perspective, we have not seen or heard of much change from what we shared over the summer on a return to office for many employees. But anecdotally, the parking lots do seem a bit fuller as we travel throughout our markets. We also are seeing an increase in conversations and showing at some of our properties. And while there is a long road to convert market interest into new leases, it is definitely a positive step forward for office space demand relative to the sentiment over the summer. Despite these green shoots, we do not think that office utilization will revert back to historical norms even as return to office gains traction. Hybrid work practices are not going away and lower utilization will likely continue to result in office tenants seeking less square footage on renewal for the foreseeable future.

我們還就位於肯塔基州卡溫頓的大樓底層約 3,000 平方英尺的零售空間簽訂了新的 10 年期租賃合同，主要出租給美國。從辦公室情緒的角度來看，我們沒有看到或聽到我們在夏季分享的許多員工重返辦公室的訊息有太大變化。但有趣的是，當我們在市場中穿梭時，停車場似乎確實有點滿。我們還發現我們的一些酒店的對話和展示有所增加。儘管將市場興趣轉化為新租賃還有很長的路要走，但相對於夏季的情緒，這絕對是辦公空間需求向前邁出的積極一步。儘管出現了這些萌芽，我們認為，即使重返辦公室的勢頭越來越大，辦公室利用率也不會恢復到歷史正常水平。混合工作方式不會消失，較低的利用率可能會繼續導致辦公室租戶在可預見的未來尋求更少的面積更新。

Tenant retention remains our highest priority. But as we've provided in our supplemental filing, we do have significant lease roll in 2024 of approximately 1.9 million square feet and several of our larger tenants have publicly indicated they do not intend to renew with us, which will impact revenues until those properties can be retenanted.

保留租戶仍然是我們的首要任務。但正如我們在補充文件中所提供的，我們在2024 年確實擁有約190 萬平方英尺的大量租賃，而且我們的幾個較大租戶已公開表示他們不打算與我們續約，這將影響收入，直到這些房產可以保留。

From the leasing pipeline perspective, however, we continue to be in various stages of discussion and negotiation for new leases and renewals of over 1.5 million square feet, including at some of our properties where we have lease roll next year. While our pipeline is encouraging, corporate decision-making remains slow and converting interest into signed leases can be a slow and uncertain process.

然而，從租賃管道的角度來看，我們仍在就超過 150 萬平方英尺的新租約和續約進行不同階段的討論和談判，包括我們明年租賃的一些物業。儘管我們的管道令人鼓舞，但企業決策仍然緩慢，將興趣轉化為已簽署的租賃可能是一個緩慢且不確定的過程。

Given the timing of leases and the size of our portfolio, retention will remain volatile quarter-over-quarter depending on the needs and timing of tenants' decisions. Our strategy remains intact: retain tenants, lease vacant space and dispose of noncore assets. We know we'll take a few more years to fully reposition our portfolio, but we continue to progress towards overcoming the challenges and are building a solid foundation from which we intend to grow our core portfolio and produce sustained cash flows to create value for our shareholders.

考慮到租賃時間和我們投資組合的規模，保留率將根據租戶決策的需求和時間而逐季度保持波動。我們的策略保持不變：留住租戶、租賃空置空間並處置非核心資產。我們知道我們還需要幾年的時間來全面重新定位我們的投資組合，但我們將繼續克服挑戰，並正在建立堅實的基礎，我們打算在此基礎上擴大我們的核心投資組合並產生持續的現金流，為我們的業務創造價值。股東。

With that, I will now turn the call over to Gavin. Gavin?

現在，我將把電話轉給加文。加文？

Thanks, Paul. I will start by discussing Orion's GAAP results for the third quarter. We generated total revenues of $49.1 million as compared to $51.8 million in the same quarter of the prior year. We reported a net loss attributable to common stockholders of $16.5 million or $0.29 per share as compared to a net loss of $53 million or $0.94 per share reported in 2022. The change year-over-year was primarily due to impairment charges of $11.4 million for the third quarter of 2023 compared to $44.8 million for the same quarter in 2022.

謝謝，保羅。我將首先討論 Orion 第三季的 GAAP 業績。我們的總收入為 4,910 萬美元，而去年同期為 5,180 萬美元。我們報告的普通股股東淨虧損為 1,650 萬美元，即每股 0.29 美元，而 2022 年報告的淨虧損為 5,300 萬美元，即每股 0.94 美元。同比變化主要是由於 1,140 萬美元的減值費用2023年第三季的銷售額為4,480 萬美元，而2022 年第三季的銷售額為4,480 萬美元。

Core funds from operations for the quarter was $24.1 million or $0.43 per share as compared to $25.6 million or $0.45 per share in the same quarter of 2022. Adjusted EBITDA was $30 million versus $32.1 million in the same quarter of 2022. The changes year-over-year are primarily related to vacancies and the disposition of properties. G&A was $4.4 million compared to $4.7 million in the third quarter of 2022 due to bonus accrual adjustments in the prior year, offset by higher compensation expenses as a result of achievement of optimal headcount during 2022 and an additional year of stock awards and the associated stock-based compensation expense.

本季營運核心資金為 2,410 萬美元，即每股 0.43 美元，而 2022 年同季為 2,560 萬美元，即每股 0.45 美元。調整後 EBITDA 為 3,000 萬美元，而 2022 年同季為 3,210 萬美元。 -年主要與職位空缺和財產處置有關。由於上一年的獎金應計調整，一般管理費用為440 萬美元，而2022 年第三季為470 萬美元，但由於2022 年實現最佳員工人數以及額外一年的股票獎勵和相關股票而導致薪酬支出增加，從而抵消了這項影響基於補償的費用。

CapEx this quarter was $8.4 million compared to $3.7 million in the third quarter of 2022, including property improvements of $6.3 million and leasing costs of $2.1 million. As a reminder, CapEx timing will be dependent on when leases are signed and work is completed on properties. CapEx will likely increase over time as leases roll over and new and existing tenants draw upon tenant improvement allowances.

本季的資本支出為 840 萬美元，而 2022 年第三季的資本支出為 370 萬美元，其中包括 630 萬美元的物業改善費用和 210 萬美元的租賃成本。提醒一下，資本支出時間將取決於租約何時簽署以及物業工作何時完成。隨著租約到期以及新租戶和現有租戶利用租戶改善津貼，資本支出可能會隨著時間的推移而增加。

Turning to the balance sheet. We ended the quarter with strong liquidity of $316.2 million, comprised of $33 million of cash and cash equivalents, including the company's pro rata share of cash from Arch Street joint venture, $250 million of available capacity on the company's $425 million revolving credit facility and $33.2 million of restricted cash deposited with our credit facility lenders, which will be used to prepay borrowings on the revolver this month and thereby increase the company's borrowing capacity of the revolver by the equivalent amount.

轉向資產負債表。截至本季末，我們擁有3.162 億美元的強勁流動性，其中包括3,300 萬美元的現金和現金等價物，其中包括公司按比例從Arch Street 合資企業獲得的現金份額、公司4.25 億美元循環信貸額度的2.5億美元可用能力以及33.2 美元。存入我們的信貸機構的受限制現金為 100 萬美元，這些現金將用於提前償還本月循環貸款的借款，從而使公司的循環貸款能力增加等值金額。

We have $557.3 million of outstanding debt, which is 100% fixed rate or swap to fixed rate. However, only until November 12, 2023, in the case of our revolving credit facility and until May 27, 2024, in the case of our share of the Arch Street joint venture mortgage debt. Upon the expiration of the interest rate swap agreements, the outstanding borrowings on the revolving credit facility will no longer be effectively fixed and the interest rate and the associated interest expense will rise materially to reflect current conditions.

我們有 5.573 億美元的未償債務，為 100% 固定利率或互換為固定利率。然而，對於我們的循環信貸安排，只能到 2023 年 11 月 12 日；對於我們在 Arch Street 合資企業抵押貸款債務中的份額，只能到 2024 年 5 月 27 日。利率互換協議到期後，循環信貸額度的未償還借款將不再有效固定，利率和相關利息支出將大幅上升，以反映當前狀況。

The company may enter into new derivative transactions in the future to fix the borrowing cost on all or part of its floating rate borrowings under the revolver. Net debt to annualized adjusted EBITDA was 4.09x at quarter end, and the weighted average interest rate was 4.65%. Because the market for financing office real estate assets is still dislocated, it remains our intention to maintain significant liquidity on the balance sheet for the foreseeable future given the expected capital commitments in our future leasing efforts and the necessary financial flexibility to execute on our business plan over the next several years.

公司未來可能會進行新的衍生性商品交易，以固定循環貸款項下全部或部分浮動利率借款的借款成本。季末淨債務與年化調整後 EBITDA 比率為 4.09 倍，加權平均利率為 4.65%。由於辦公房地產資產融資市場仍然混亂，鑑於我們未來租賃工作中的預期資本承諾以及執行我們業務計劃所需的財務靈活性，我們仍然打算在可預見的未來保持資產負債表上的大量流動性在接下來的幾年裡。

Orion's Board of Directors declared a quarterly cash dividend of $0.10 per share for the fourth quarter of 2023 to be paid on January 16, 2024, to stockholders of record as of December 29, 2023. Finally, we are updating our expectations for our full year 2023 guidance for core FFO and net debt to adjusted EBITDA. Core FFO is now anticipated to range from $1.65 to $1.68 per diluted share, up from $1.59 to $1.63 per diluted share. Much of the increase is attributable to onetime items and includes the impact of property operating expense reimbursements, lower public company costs than anticipated and lower share count due to share repurchase activity.

Orion 董事會宣布將於 2024 年 1 月 16 日向截至 2023 年 12 月 29 日登記在冊的股東支付 2023 年第四季度每股 0.10 美元的季度現金股息。最後，我們更新了對全年的預期2023 年核心FFO 和調整後EBITDA 淨債務指引。目前，核心 FFO 預計稀釋後每股價格為 1.65 美元至 1.68 美元，高於稀釋後每股 1.59 美元至 1.63 美元。成長的大部分歸因於一次性項目，包括財產營運費用報銷、上市公司成本低於預期以及股票回購活動導致的股票數量減少的影響。

Net debt to adjusted EBITDA is now expected to range from 4.0x to 4.7x, down from 4.3x to 5.0x. G&A expectations are unchanged, ranging from $18.25 million to $18.75 million. One additional note, while we do not provide quarterly guidance, given scheduled lease vacancies during this year and next, we expect to continue to have sequential reductions in the quarterly amount of earnings and core FFO on a per share basis as we move through the rest of the year and into the coming year.

淨債務與調整後 EBITDA 比率目前預計為 4.0 倍至 4.7 倍，低於 4.3 倍至 5.0 倍。 G&A 預期保持不變，範圍為 1,825 萬美元至 1,875 萬美元。另請注意，雖然我們不提供季度指導，但考慮到今年和明年的預定租賃空缺，我們預計在我們完成其餘部分時，每股季度收益和核心 FFO 將繼續連續減少今年和來年。

As we head towards the close of the year, the capital allocation decisions that we have made have put the company in a strong financial position, which is further supported by our cash from operations and property sales that should enable us to reach our near- and long-term objectives. We remain focused on creating value by effectively executing our business plan. With that, we will open the line for questions. Operator?

隨著年底的臨近，我們做出的資本配置決策使公司處於強勁的財務狀況，這得到了我們來自營運和房地產銷售的現金的進一步支持，這將使我們能夠達到我們的近期目標和目標。長期目標。我們仍然專注於透過有效執行我們的業務計劃來創造價值。至此，我們將開通提問專線。操作員？

(Operator Instructions)

（操作員說明）

Our first question comes from the line of Mitch Germain with JMP Securities.

我們的第一個問題來自 JMP 證券公司的米奇傑曼 (Mitch Germain)。

I'm curious, what was the timing in the quarter of when Walgreens and Experian -- when was their move-out dates? I'm trying to figure out how much of that had an impact on the quarter?

我很好奇，沃爾格林和益百利在本季的具體時間是什麼時候——他們的搬出日期是什麼時候？我想弄清楚這對本季有多大影響？

I think Walgreens, their lease expired in the end -- very end of July to beginning of August.

我認為沃爾格林，他們的租約最終到期了——七月底到八月初。

Walgreens was 8/31.

沃爾格林是 8 月 31 日。

8/31, okay, thank you, Chris.

8 月 31 日，好的，謝謝你，克里斯。

Experian was 7/31.

益百利是 7 月 31 日。

Okay. So you had them swapped.

好的。所以你把它們交換了。

Yes, I did. My mistake.

是的，我做到了。我的錯。

It's okay. And -- okay, that's perfect. And then I'm trying to -- help me out here, Paul. I mean, you started the year with 4.1-year average WALT.

沒關係。而且——好吧，那就完美了。然後我試著──保羅，幫助我。我的意思是，您今年年初的平均 WALT 為 4.1 年。

You did some leasing, you sold some vacancy. And here you enter 4Q with 3.9 of average WALT. When does this pressure begin to moderate because most of the leasing that you've been doing obviously has been 10 years. Is it just a function of a shrinking base of assets that's just causing that to not really change much?

你做了一些租賃，你賣了一些空置。在這裡，您進入第 4 季度，平均 WALT 為 3.9。這種壓力什麼時候開始緩解，因為您所做的大部分租賃顯然已經持續了 10 年。這是否只是資產基礎萎縮的結果，導致資產基礎並沒有真正改變太多？

Yes, to some degree, and it's a function of not as much new leasing as we'd like to achieve and hope to achieve in the future, Mitch. I think we're going to continue to see pressure on our WALT throughout next year because we've got quite a number of leases that are rolling over. And then hopefully, in the out years, that is 25 and beyond, we'll start to see gradual increases in WALT as we both renew leases and add new leases.

是的，在某種程度上，這並不是我們希望實現並希望未來實現的新租賃的功能，米奇。我認為明年我們的 WALT 將繼續面臨壓力，因為我們有相當多的租約正在延期。希望在接下來的幾年裡，即 25 年及以後，隨著我們續約和增加新租約，我們將開始看到 WALT 逐漸增加。

Okay. That's helpful. And then you referenced -- I think it is the first time you've ever provided some perspective on the volume in your leasing pipeline unless I'm incorrect. I think you said 1.5 million square feet. Is that correct?

好的。這很有幫助。然後你提到——我認為這是你第一次對租賃管道中的數量提供一些看法，除非我錯了。我想你說的是 150 萬平方英尺。那是對的嗎？

That's correct. I mean I think from time to time, Mitch, in the past, we've said we sort of given indications of where our volumes are. So I think what we're trying to say is, on the one hand, in 2024, we've got a lot of lease roll, and we've got some vacancy coming up. And that will have a material negative impact on revenues. On the other side of that coin, we have also got some significant amount of interest, both from -- in tenant interest, both from a renewal perspective and from a new lease perspective, which would fill -- which we would hope would fill some of our vacancy. So we've got good leasing activity. And by that, I mean people visiting our properties, us exchanging requests for proposals and the like.

這是正確的。我的意思是，米奇，我認為過去我們有時會說過，我們給了我們的銷量的指示。所以我認為我們想說的是，一方面，到 2024 年，我們有大量的租賃合同，並且出現了一些空缺。這將對收入產生重大負面影響。另一方面，我們也獲得了一些大量的興趣，無論是從租戶的興趣，還是從續約的角度和新的租賃角度來看，這將填補——我們希望這將填補一些我們的空缺。所以我們有良好的租賃活動。我的意思是人們參觀我們的房產，我們交換建議請求等。

But it's a long way from people visiting a property or asking us to respond with an RFP to a signed lease. One of the things we found over the past year is that decision-making cycle at the corporate level can take a long time. So we've got good momentum in leasing, but getting from that momentum to a signed lease can take some time. But we're -- over the intermediate term, we're quite optimistic about being able to fill up some of these vacancies that we have coming up.

但這距離人們參觀房產或要求我們以 RFP 回應已簽署的租約還有很長的路要走。過去一年我們發現的一件事是，企業層面的決策週期可能需要很長時間。因此，我們在租賃方面擁有良好的勢頭，但從這種勢頭到簽署租約可能需要一些時間。但從中期來看，我們對填補一些即將出現的空缺感到非常樂觀。

And this is the second quarter in a row where you've referenced a little bit of an uptick in activity. So I guess, do you feel like we're nearing a bottom here and kind of moving a little bit maybe up? Or do you think that there's still a little bit more pain, not just your portfolio, but just in the office sector in general?

這是您連續第二個季度提到活動有所增加。所以我想，你是否覺得我們已經接近底部並且可能會有所上升？或者您認為還有更多的痛苦，不僅僅是您的投資組合，而是整個辦公領域？

I guess I have a couple of responses to that, Mitch. One is I certainly hope this is the bottom. It's certainly been painful getting to where we are today and the overall market is under a fair amount of stress with a lot of vacancy across the office markets.

我想我對此有幾個回應，米奇。一是我當然希望這是底部。我們走到今天的位置確實很痛苦，整個市場承受相當大的壓力，辦公大樓市場有許多空置。

For Orion, we're a little different. And by that, I only mean because of our size, and we have single tenants, we're so granular. So we've got a lot of lease roll in 2024, a couple of several properties of our larger properties where the tenant has said they're going to move out. So that we have some pain to come looking forward. But when we think about refilling that vacancy, I would say we're more optimistic about that today than we probably were 6 months ago. So hopefully, both for Orion and for the industry at large, if we're not at the bottom, maybe we can see it from here.

對於獵戶座來說，我們有點不一樣。我的意思只是因為我們的規模，而且我們有單一租戶，所以我們的粒度非常細。因此，我們在 2024 年有大量的租賃合同，其中有幾處較大物業的租戶已表示將搬出。所以我們在展望未來時會遇到一些痛苦。但當我們考慮填補該空缺時，我想說我們今天對此比 6 個月前更加樂觀。因此，希望對於 Orion 和整個行業來說，如果我們沒有處於底部，也許我們可以從這裡看到它。

Got you. Okay. Last one for me. Your guidance implies a pretty significant deceleration in the fourth quarter. You get the benefit of the lower share count. Obviously, you're offsetting that against some of those vacancies or Walgreens and Experian not being in the full quarter some new vacancies. I'm just trying to understand, I mean, how do you bridge me from 3Q to 4Q to get to kind of midpoint of your guidance?

明白你了。好的。最後一張給我。您的指導意味著第四季度將出現相當大的減速。您可以獲得較低份額數量的好處。顯然，您正在抵消其中一些空缺或沃爾格林和益百利在整個季度中沒有出現的一些新空缺。我只是想了解，我的意思是，您如何將我從 3Q 過渡到 4Q，以達到您指導的中點？

Yes. I mean I think we've got a fair amount of deceleration in revenues as a result of Walgreens being moved out. And we also were helped recently with some onetime items that won't be recurring. We did a little bit better on some tax appeals and some property expenses. So there are a number of items that sort of have helped us in the past and won't be helping us in the fourth quarter. Obviously, the share repurchase will continue to help us to some degree. But I think it's really the things I just mentioned that is deceleration in revenues, coupled with the positive impacts of some onetime items that won't be recurring.

是的。我的意思是，我認為由於沃爾格林的搬遷，我們的收入大幅下降。最近我們也得到了一些不會重複出現的一次性項目的幫助。我們在一些稅務上訴和一些財產支出方面做得更好一些。因此，有很多項目在過去對我們有幫助，但在第四季度不會對我們有幫助。顯然，股票回購將繼續在一定程度上幫助我們。但我認為我剛才提到的確實是收入減速，再加上一些不會重複出現的一次性項目的正面影響。

(Operator Instructions) And we have reached the end of the question-and-answer session. And I'll turn the call back over to Paul McDowell for closing remarks.

（操作員說明）問答環節已經結束。我將把電話轉回給保羅·麥克道爾（Paul McDowell）做總結發言。

Thank you all for joining us today on our third quarter call, and we look forward to updating you further in the beginning of next year. Thank you.

感謝大家今天參加我們的第三季電話會議，我們期待在明年初向您提供進一步的最新消息。謝謝。

And this concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation.

今天的會議到此結束，大家可以掛斷電話了。感謝您的參與。