Orion Properties Inc (ONL) 2024 Q1 法說會逐字稿

Greetings, and welcome to Orion Office REIT's first-quarter 2024 earnings call. As a reminder, this conference is being recorded. I would now like to turn the call over to Mr. Paul Hughes, General Counsel for Orion. Thank you, and you may now begin.

大家好，歡迎參加 Orion Office REIT 的 2024 年第一季財報電話會議。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 先生。謝謝您，您現在可以開始了。

Thank you and good morning, everyone. Yesterday, Orion released its financial results for the quarter ended March 31, 2024, 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 2024 年 3 月 31 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 the call today are not strictly historical information and constitute forward-looking statements. These statements include the company's guidance estimates for calendar year 2024 and are based on management's current expectations and are subject to certain 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.

今天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 2024 年曆年的指導估計，基於管理層當前的預期，並面臨某些風險，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 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.

此外，在今天的電話會議中，我們將討論某些非 GAAP 財務指標，例如來自營運或 FFO 的資金以及來自營運或核心 FFO 的核心資金。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。

Our presentation of this information is not a substitute for the financial information presented in accordance with GAAP. 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. With that, I am now going to turn the call over to Paul McDowell.

我們提供的此資訊不能取代根據 GAAP 提供的財務資訊。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。現在，我將把電話轉給保羅·麥克道爾。

Good morning, everyone. And thank you for joining us on Orion Office REIT's first-quarter 2024 earnings call. Today, I will highlight the progress we are making executing on our business strategy and discuss our first-quarter performance and operations. Following my remarks, Gavin will review our financial results and provide our outlook for the rest of the year.

大家，早安。感謝您參加 Orion Office REIT 的 2024 年第一季財報電話會議。今天，我將重點介紹我們在執行業務策略方面的進展，並討論我們第一季的業績和營運情況。在我講話之後，加文將回顧我們的財務表現並提供我們對今年剩餘時間的展望。

We owned 75 properties and six unconsolidated joint venture properties comprising 8.9 million rentable square feet that were 75.8% occupied at the end of the first quarter. Adjusted for properties that are currently under agreement to be sold, our occupancy rate was 83.2% at quarter end.

我們擁有 75 處房產和 6 處未合併的合資房產，可出租面積為 890 萬平方英尺，截至第一季末，入住率達 75.8%。根據目前協議出售的物業進行調整後，季度末我們的入住率為 83.2%。

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 March 31, 70.1% of our tenants were investment [grade]. Our portfolio of assets remains well diversified by tenant, tenant industry, and geography. The United States government is our largest tenant by annualized base rent and our two largest tenant industries are healthcare and government.

投資組合中的物業主要是三重或雙重淨租賃給信譽良好的租戶。截至 3 月 31 日，我們的租戶中有 70.1% 是投資租戶，佔年化基本租金的百分比[年級]。我們的資產組合在租戶、租戶行業和地理位置方面仍然保持多元化。以年化基本租金計算，美國政府是我們最大的租戶，我們最大的兩個租戶產業是醫療保健和政府。

Over 35% of our annualized base rent is derived from Sunbelt markets. Our largest markets by state are Texas, New Jersey, and New York. At the end of Q1, our portfolio's weighted average lease term remained steady at 4.1 years. The story of the first quarter and into the beginning of the second has been leasing momentum. As of today, we have completed 522,000 square feet of new and renewal leasing this year, more than doubling the amount we executed last year.

我們超過 35% 的年化基本租金來自 Sunbelt 市場。按州劃分，我們最大的市場是德克薩斯州、新澤西州和紐約州。截至第一季末，我們投資組合的加權平均租賃期間穩定在 4.1 年。第一季的故事和進入第二季度的開頭一直是租賃勢頭。截至今天，我們今年已完成 522,000 平方英尺的新租賃和續租租賃，是去年執行金額的兩倍多。

During the first quarter, we gained traction on renewals and new leases, signing two long-term lease transactions with the United States government, a 17-year lease renewal for 9,000 square feet at one of our Eagle Pass Texas properties, and a new 15-year lease for 86,000 square feet at our Lincoln, Nebraska property that will bring that property back to full occupancy. We also signed a new 10-year lease for 6,000 square feet of restaurant space at one of our Tulsa, Oklahoma properties.

在第一季度，我們在續約和新租約方面取得了進展，與美國政府簽署了兩項長期租賃交易，對我們位於德克薩斯州Eagle Pass 的一處房產9,000 平方英尺的租約進行了17年的續租，並簽署了新的15 年租約。我們還在俄克拉荷馬州塔爾薩的一處物業簽署了一份新的 10 年期租約，租用了 6,000 平方英尺的餐廳空間。

All told in the first quarter, we executed 108,000 square feet of new and renewal leases. Subsequent to quarter end and after more than a year of work on our part, the United States government exercised a four-year renewal option for all 413,000 square feet at our Covington, Kentucky property, which was set to expire in July of this year.

總而言之，第一季我們執行了 108,000 平方英尺的新租約和續約租約。季度末後，經過我們一年多的努力，美國政府對我們位於肯塔基州卡溫頓的房產的全部413,000 平方英尺的土地行使了四年續約選擇權，該選擇權原定於今年7 月到期。

We also remain in discussions with the GSA regarding a significantly longer-term extension for a substantial portion of the tenant's existing square footage at this property. However, given the new four-year extension, we expect those negotiations will take place over an extended period of time as the government continues to refine its needs at the property.

我們也正在與 GSA 就該物業現有大部分租戶面積的長期延期進行討論。然而，鑑於新的四年延期，我們預計隨著政府繼續改善對該物業的需求，這些談判將在較長時間內進行。

As we move through the year, we have continued to see signs of strength in our forward leasing pipeline, which totals more than 1.5 million square feet in various stages of discussion, negotiation, and documentation. Importantly, we are starting to see some momentum in new tenants interested in some of our vacant space.

在這一年裡，我們不斷看到遠期租賃管道的強勁跡象，處於討論、談判和文件記錄各個階段的總面積超過 150 萬平方英尺。重要的是，我們開始看到新租戶對我們的一些空置空間感興趣。

While these green shoots are more than welcome, we, of course, caution that the leasing environment remains very difficult, and our expectation is that we will continue to have to carry substantial vacancy for the foreseeable future as the market slowly recovers.

雖然這些萌芽非常受歡迎，但我們當然警告租賃環境仍然非常困難，我們的預期是，隨著市場緩慢復甦，在可預見的未來，我們將繼續面臨大量空置。

That said, given the costs associated with owning vacancy, dispositions of those assets in the portfolio that we deem overly difficult or expensive to re-lease or both remain a key area of focus. We have made tremendous progress on this initiative. Since the spin, we have sold more than 15% of the portfolio with gross proceeds of $58.5 million, much of which has gone to pay down debt, which has been reduced by more than $145 million over the same period.

也就是說，考慮到與擁有空置空間相關的成本，投資組合中那些我們認為重新租賃過於困難或昂貴或兩者兼而有之的資產的處置仍然是重點關注領域。我們在這項舉措上取得了巨大進展。自分拆以來，我們已出售了超過 15% 的投資組合，總收益為 5,850 萬美元，其中大部分用於償還債務，同期債務減少超過 1.45 億美元。

The sale of these 17 properties totaling 1.8 million square feet has materially reduced carry costs, significantly reduced forward expected CapEx, and has freed up capital and human resources to focus on those properties in the portfolio where we do believe in our long-term re-leasing prospects. This process will continue as we grapple with ongoing lease rollover in this depressed selling environment.

這17 處房產的出售，總面積為180 萬平方英尺，大大降低了持有成本，顯著降低了預期資本支出，並釋放了資本和人力資源，以專注於投資組合中那些我們確實相信我們長期可持續發展的房產。隨著我們在低迷的銷售環境中努力解決持續的租賃展期問題，這個過程將持續下去。

During April, following an extensive marketing process, we entered into an agreement to sell an approximately 96,000 square foot vacant property in St. Charles, Missouri for $2.1 million. We expect this sale to close later this quarter. We also still have agreements in place to sell seven additional properties representing 694,000 square feet for approximately $46 million.

4 月份，經過廣泛的營銷流程，我們達成協議，以 210 萬美元的價格出售密蘇裡州聖查爾斯一處約 96,000 平方英尺的空置房產。我們預計此次出售將於本季稍後完成。我們還簽訂了協議，以約 4,600 萬美元的價格出售另外七處房產，總面積為 694,000 平方英尺。

The properties under agreement include the six-property former Walgreen campus in Deerfield, Illinois that the buyer intends to redevelop. While the project has experienced delays since going under contract in early 2023, the buyer continues to make progress with its redevelopment plans. No current market and financial conditions have made it difficult to get all the necessary components lined up for a closing to occur. At this stage, we can't forecast when or if this sale will close.

協議中的房產包括位於伊利諾伊州迪爾菲爾德的前沃爾格林校園的六處房產，買方打算重新開發該房產。儘管該項目自 2023 年初簽訂合約以來經歷了延誤，但買方的重建計劃仍在繼續取得進展。目前的市場和財務狀況使得完成交割所需的所有必要組件都難以準備就緒。現階段，我們無法預測此次銷售何時或是否會結束。

As discussed last quarter, we also have a vacant property in Denver, Colorado under contract to be sold to a buyer who intends to redevelop the property to residential use. And this sale is scheduled to close in the first half of 2025. In addition to these properties, we continuously evaluate our portfolio and will likely identify additional properties to market for sale in 2024.

正如上季所討論的，我們在科羅拉多州丹佛市還有一處空置房產，根據合約將出售給打算將該房產重新開發為住宅用途的買家。此次銷售預計於 2025 年上半年完成。除了這些房產之外，我們還會不斷評估我們的投資組合，並可能在 2024 年確定更多房產上市出售。

As we've repeated over the last several quarters, while asset sales reduce operating expense drag in the short term and capital expenditure requirements, it will pressure our ability to grow earnings in the future as we become smaller with fewer buildings to lease.

正如我們在過去幾季中重複的那樣，雖然資產出售減少了短期營運費用拖累和資本支出需求，但隨著我們規模不斷縮小，可供租賃的建築物越來越少，這將對我們未來獲利成長的能力構成壓力。

Although we continue to shrink the asset base, in the current environment, this is the right approach to maximize the long-term value of the overall portfolio. We are striving to establish a core portfolio of well-leased properties in attractive long-term markets with stable cash flows that will be attractive to shareholders and other market participants alike.

儘管我們不斷縮減資產基礎，但在當前環境下，這是實現整體投資組合長期價值最大化的正確做法。我們正在努力在有吸引力的長期市場上建立一個由租賃良好的物業組成的核心投資組合，該投資組合具有穩定的現金流，這將對股東和其他市場參與者俱有吸引力。

Part and parcel with these efforts is maintaining a strong capital structure that can support the necessary investments in our core portfolio. We continue to manage the balance sheet prudently, prioritizing loan leverage to retain the flexibility we need to invest in the remaining portfolio. We have been successful here as well by retiring our term loan, paying down our revolver, and putting us in a position to extend its maturity while at the same time keeping in place low-coupon non-recourse CMBS debt that will give us good optionality in the future.

這些努力的重要組成部分是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。我們繼續審慎管理資產負債表，優先考慮貸款槓桿，以保留投資剩餘投資組合所需的靈活性。我們在這方面也取得了成功，我們註銷了定期貸款，還清了左輪手槍，並使我們能夠延長其期限，同時保持低息無追索權 CMBS 債務，這將為我們提供良好的選擇權將來。

While the time to stabilize the portfolio and re-lease vacancy are still measured in years, we have made substantial progress, and our company remains profitable on both an FFO and core FFO basis, supported by a strong core asset base, which we do not expect to change.

雖然穩定投資組合和重新租賃空缺的時間仍需要數年時間，但我們已經取得了實質性進展，並且在強大的核心資產基礎的支持下，我們公司在FFO 和核心FFO 的基礎上仍然保持盈利，而我們並不認為這一點是可靠的。

Our current business plan, retaining existing tenants, filling empty spaces, and streamlining through non-core asset disposals remains in place. With the help of our advisors and our board, we also continue to look outside of the day-to-day tactical operation of the company and remain flexible in our approach to opportunity. And we'll make strategic changes to our business plan if we believe doing so will generate the best outcome for shareholders.

我們目前的業務計劃，保留現有租戶，填補空置空間，並透過非核心資產處置進行精簡，仍然有效。在顧問和董事會的幫助下，我們也繼續將目光投向公司日常戰術運作之外，並保持靈活的抓住機會的方式。如果我們相信這樣做會為股東帶來最好的結果，我們將對我們的業務計劃進行策略性改變。

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. Orion generated total revenues of $47.2 million in the first quarter as compared to $50.2 million in the same quarter of the prior year. Importantly, we benefited from $3.8 million of one-time revenues in the quarter for real estate tax reimbursements and end-of-lease obligation payments for former tenants. Of the one-time revenues, $1.6 million of tax reimbursements were not expected to be received until next year.

謝謝，保羅。Orion 第一季總營收為 4,720 萬美元，而去年同期為 5,020 萬美元。重要的是，我們從本季的 380 萬美元一次性收入中受益，用於房地產稅報銷和前租戶的租賃結束義務付款。在一次性收入中，預計明年才能收到 160 萬美元的退稅。

We reported a net loss attributable to common stockholders of $26.2 million or $0.47 per share as compared to a net loss of $8.9 million or $0.16 per share reported in the first quarter of 2023. Core funds from operations for the quarter was $20.4 million, or $0.36 per share as compared to $25.3 million or $0.45 per share in the same quarter of 2023. Adjusted EBITDA was $26.7 million versus $31.2 million in the first quarter of 2023.

我們報告的普通股股東淨虧損為 2,620 萬美元，即每股 0.47 美元，而 2023 年第一季報告的淨虧損為 890 萬美元，即每股 0.16 美元。本季營運核心資金為 2,040 萬美元，即每股 0.36 美元，而 2023 年同一季度為 2,530 萬美元，即每股 0.45 美元。調整後 EBITDA 為 2,670 萬美元，而 2023 年第一季為 3,120 萬美元。

G&A in the first quarter was $4.9 million compared to $4.3 million in the same quarter of 2023 due primarily to the timing of corporate-related expenses and higher compensation expense as a result of an additional year of non-cash stock-based compensation expense.

第一季的一般管理費用為 490 萬美元，而 2023 年同一季度為 430 萬美元，這主要是由於公司相關費用的時間安排以及因額外一年的非現金股票補償費用而導致的補償費用增加。

CapEx in the quarter was $3.4 million compared to $3.3 million in the same quarter of 2023. As we have previously discussed, CapEx timing is dependent on when leases are signed, and work is completed on the properties. CapEx will likely increase over time as leases roll and new and existing tenants draw upon tenant improvement allowances.

本季的資本支出為 340 萬美元，而 2023 年同一季度的資本支出為 330 萬美元。正如我們之前討論的，資本支出時間取決於租約何時簽署以及物業工作何時完成。隨著租約的延長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。

We ended the first quarter with $498.3 million of outstanding debt, including $355 million under the fixed rate non-recourse CMBS loan due in February 2027, $116 million of floating rate debt on our revolving credit facility, and $27.3 million, representing our share of the Arch Street joint venture debt, which is swapped to fixed rate until May 27, 2024, and scheduled to mature on November 27, 2024. At quarter end, our net debt to annualized adjusted EBITDA was 4.43 times.

截至第一季末，我們的未償債務為4.983 億美元，其中包括2027 年2 月到期的固定利率無追索權CMBS 貸款下的3.55 億美元、我們循環信貸安排上的浮動利率債務1.16億美元，以及我們在債務融資中所佔份額的2,730 萬美元。截至季末，我們的淨負債與年化調整後 EBITDA 的比率為 4.43 倍。

I will now discuss our recent amendment to our revolving credit agreement executed subsequent to quarter end that rightsized our borrowing capacity and made it proportionately a reduction to the minimum value of the unencumbered asset pool we are required to maintain as well as modified other financial covenants. Given the significant reduction in the size of the portfolio, we do not expect the slightly reduced borrowing capacity to adversely impact the execution of our business plan, and it will modestly benefit us by lowering the unused fees we are obligated to pay to the lenders.

我現在將討論我們最近對季度末後執行的循環信貸協議的修訂，該修訂調整了我們的借貸能力，並按比例減少了我們需要維持的未支配資產池的最低價值，並修改了其他財務契約。鑑於投資組合規模大幅縮小，我們預計借貸能力的略微下降不會對我們業務計劃的執行產生不利影響，並且透過降低我們有義務向貸方支付的未使用費用，這將使我們適度受益。

It is important to note that the amendments provide greater certainty that we will be able to continue to comfortably satisfy the financial covenants through the full term of the revolving credit facility, including the extension term even at our reduced asset size. We intend in the near term to elect our option to extend the maturity for an additional 18 months from November 12th, 2024, to May 12th, 2026.

值得注意的是，修正案提供了更大的確定性，即我們將能夠在循環信貸便利的整個期限內繼續舒適地滿足財務契約，包括即使在我們減少資產規模的情況下延長期限。我們打算在短期內選擇將期限再延長 18 個月，從 2024 年 11 月 12 日到 2026 年 5 月 12 日。

We are grateful to the lender group for their continued support and continued confidence in Orion, which we believe further validates our approach and execution against the backdrop of this challenging financial climate. As of the end of the quarter and after giving effect to the amendment -- to the credit facility, we had strong total liquidity of $258.3 million, comprised of $24.3 million of cash and cash equivalents, including the company's pro rata share of cash in the Arch Street joint venture and $234 million of available capacity of the company's $350 million revolving credit facility.

我們感謝貸方集團對 Orion 的持續支持和持續信心，我們相信這進一步驗證了我們在當前充滿挑戰的金融環境下的方法和執行力。截至本季末，在信貸安排修正案生效後，我們擁有 2.583 億美元的強勁總流動性，其中包括 2,430 萬美元的現金和現金等價物，包括公司按比例持有的現金份額。該公司3.5 億美元循環信貸額度中2.34 億美元的可用容量。

We intend to maintain significant liquidity on the balance sheet for the foreseeable future to provide financial flexibility required to execute on our business plan over the next several years, including the funding of expected capital commitments to support our future leasing efforts.

我們打算在可預見的未來保持資產負債表上的大量流動性，以提供執行未來幾年業務計劃所需的財務靈活性，包括為支持我們未來租賃工作的預期資本承諾提供資金。

As it relates to the Arch Street joint venture debt, the joint venture may be unable to satisfy the conditions to exercise a one-year extension option under the non-recourse loan agreement. Therefore, the joint venture is evaluating alternatives to refinance this obligation.

由於涉及Arch Street合資企業債務，合資企業可能無法滿足無追索權貸款協議下行使一年期延期選擇權的條件。因此，合資企業正在評估為該義務再融資的替代方案。

Turning to our dividend, Orion's Board of Directors declared a quarterly cash dividend of $0.10 per share for the second quarter of 2024, payable on July 15, 2024, to stockholders of record as of June 28, 2024. Based on our quarterly results and our expectations for our full-year 2024, we are reaffirming our guidance for core FFO range of $0.93 to $1.1 per diluted share, G&A range of $19.5 million to $20.5 million and net debt to adjusted EBITDA range of 6.2 times to 7.0 times.

至於我們的股息，Orion 董事會宣布 2024 年第二季的季度現金股息為每股 0.10 美元，將於 2024 年 7 月 15 日支付給截至 2024 年 6 月 28 日在冊的股東。根據我們的季度業績和對2024 年全年的預期，我們重申核心FFO 範圍為稀釋後每股0.93 美元至1.1 美元，一般管理費用範圍為1,950 萬美元至2,050 萬美元，淨債務與調整後EBITDA 範圍為6.2 倍。

With that, we'll open the line for questions. Operator?

這樣，我們將開通提問熱線。操作員？

(Operator Instructions) Mitch Germain, JMP Securities.

（操作員指令）Mitch Germain，JMP 證券。

Hi, this is Jyoti on for Mitch. Congratulations on the leasing this year. So do you feel more conviction now towards tenant decision making?

大家好，我是喬蒂為米奇代言的。恭喜今年的租賃。那麼您現在對租戶的決策更有信心了嗎？

Yes, good morning. Thanks. And yes, our forward leasing pipeline continues to look pretty healthy. The leasing we've done this year, some of it was expected leasing; that is, we expected the renewals that we've received but still took quite a bit of work to get it done.

是的，早安。謝謝。是的，我們的遠期租賃管道看起來仍然相當健康。我們今年做的租賃，有些是預期租賃；也就是說，我們預計會收到續訂，但仍然需要做相當多的工作才能完成。

And some of it was some new leases on vacant space, and I'd say that's where we feel where we're seeing some of the best traction now that is we're starting to see tenants interested in some of our vacant space and transferring that interest from just straight interest to actually signed lease. So we feel pretty good about the full pipeline, but also, I want to stress that the conditions remain very tough out there. And competition is very high for new tenants. So I don't want to read too much into it, but we definitely feel better about the forward pipeline from there.

其中一些是對空置空間的一些新租約，我想說這就是我們覺得我們現在看到的一些最好的牽引力的地方，那就是我們開始看到租戶對我們的一些空置空間感興趣並轉移該利息從直接利息到實際簽署的租約。因此，我們對整個管道感覺非常好，但我想強調的是，那裡的條件仍然非常艱難。新租戶的競爭非常激烈。所以我不想過多地解讀它，但我們肯定對從那裡開始的前向管道感覺更好。

That's fair. So just a little bit, if you can give some background on the US government leases, when did those negotiations pick in? I think for one, you said it was a year-long process but how is it playing out now.

這還算公平。那麼，如果您能提供一些有關美國政府租賃的背景信息，這些談判是什麼時候開始的？我想，你說這是一個長達一年的過程，但現在進展如何。

I mean, the government -- the property that we renewed in Covington, Kentucky leased to the federal government is a large facility. And so we had a lot of conversations with the government about that property, their needs at that property, what type of capital we needed to put into the property. So we worked with them for quite a long period of time, so I think since from last summer.

我的意思是，政府——我們在肯塔基州卡溫頓續租給聯邦政府的財產是一個大型設施。因此，我們與政府就該房產、他們對該房產的需求以及我們需要向該房產投入哪種類型的資本進行了很多對話。所以我們和他們合作了很長一段時間，所以我想從去年夏天開始。

in general, our interactions with the federal government take anywhere from a month to up to a year. It just depends a little bit on the property, the government's needs at that property, and frankly, the contracting officer that's running the lease negotiations. So we're prepared, I guess, for all eventualities.

一般來說，我們與聯邦政府的互動需要一個月到一年的時間。這在一定程度上取決於該房產、政府對該房產的需求，以及坦白說，取決於負責租賃談判的簽約官員。所以我想我們已經為所有可能發生的情況做好了準備。

Yes, that's fair. And just switching on here, the last question on the Arch Street venture, could you give some insight if there's any term on that and expectations or some history?

是的，這很公平。就在這裡，關於拱門街合資企業的最後一個問題，如果有任何關於此的術語和期望或一些歷史，您能否提供一些見解？

With respect to the Arch Street joint venture, we have a non-recourse mortgage loan facility, which expires in November of this year. The portfolio assets are all fully occupied, are all fully performing, and cash flowing. So the assets in that portfolio comfortably support the outstanding debt.

對於Arch Street 合資企業，我們擁有無追索權抵押貸款安排，該貸款安排將於今年11 月到期。投資組合資產全部被充分佔用、全部表現良好、現金流通。因此，該投資組合中的資產可以輕鬆支持未償債務。

At the conclusion of the initial term, we're required to meet several covenants, among them our loan-to-value and weighted average lease term, which we are working to get to that level so that we can extend the debt. So our plan with that facility right at the moment is to hopefully extend the debt with the existing lenders, or if not to refinance the portfolio away. But the portfolio itself is performing well and is a strong portfolio.

在初始期限結束時，我們需要滿足幾項契約，其中包括我們的貸款價值比和加權平均租賃期限，我們正在努力達到這一水平，以便我們可以延長債務。因此，我們目前對該貸款的計劃是希望延長現有貸方的債務，或者如果不為投資組合進行再融資。但該投資組合本身表現良好，是強大的投資組合。

That's all from me. Thank you for answering the questions.

這就是我的全部。感謝您回答問題。

Thank you. At this time, I'll hand the floor back to Mr. Paul McDowell for any further remarks.

謝謝。此時，我將把發言權交還給保羅·麥克道爾先生，以便進一步發表評論。

Thank you all for joining us today on our first-quarter call, and we look forward to you joining us on our second-quarter call later this summer. Thank you. Bye-bye.

感謝大家今天參加我們的第一季電話會議，我們期待您在今年夏天晚些時候參加我們的第二季電話會議。謝謝。再見。

Thank you. This will conclude today's conference. You may now disconnect your lines at this time, and we thank you for your participation and have a wonderful day.

謝謝。今天的會議到此結束。您現在可以斷開線路，我們感謝您的參與，祝您有美好的一天。