Office Properties Income Trust (OPI) 2021 Q1 法說會逐字稿

Good morning and welcome to the Office Properties Income Trust First Quarter 2021 Earnings Conference Call. (Operator Instructions) After today's presentation, there will be an opportunity to ask questions. (Operator Instructions) Please note this event is being recorded.

早安，歡迎參加 Office Properties Income Trust 2021 年第一季財報電話會議。 （操作員說明）今天的演示結束後，將有機會提問。 （操作員說明）請注意此事件正在被記錄。

I would now like to turn the conference over to Olivia Snyder, Manager, Investor Relations. Please go ahead.

我現在想將會議交給投資者關係經理 Olivia Snyder。請繼續。

Thank you, and good morning, everyone. Thanks for joining us today. With me on the call are OPI's President and Chief Operating Officer, Chris Bilotto; and Chief Financial Officer and Treasurer, Matt Brown. In just a moment, they will provide details about our business and our performance for the first quarter of 2021 followed by a question-and-answer session with sell-side analysts.

謝謝大家，大家早安。感謝您今天加入我們。與我一起參加電話會議的是 OPI 總裁兼營運長 Chris Bilotto；財務長兼財務主管馬特布朗。稍後，他們將提供有關我們的業務和 2021 年第一季業績的詳細信息，然後與賣方分析師進行問答。

First, I would like to note that the recording and retransmission of today's conference call is prohibited without the prior written consent of the company. Also, note that today's conference call contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other securities laws. These forward-looking statements are based on OPI's beliefs and expectations as of today, Friday, April 30, 2021, and actual results may differ materially from those that we project. The company undertakes no obligation to revise or publicly release the results of any revision to the forward-looking statements made in today's conference call. Additional information concerning factors that could cause those differences is contained in our filings with the Securities and Exchange Commission or SEC, which can be accessed from our website opireit.com or the SEC's website. Investors are cautioned not to place undue reliance upon any forward-looking statements.

首先，我想指出的是，未經公司事先書面同意，禁止對今天的電話會議進行錄音和轉播。另請注意，今天的電話會議包含 1995 年《私人證券訴訟改革法案》和其他證券法含義內的前瞻性陳述。這些前瞻性聲明是基於 OPI 截至今天（2021 年 4 月 30 日星期五）的信念和預期，實際結果可能與我們的預測有重大差異。該公司不承擔修改或公開發布對今天電話會議中前瞻性陳述的任何修改結果的義務。有關可能導致這些差異的因素的更多資​​訊包含在我們向美國證券交易委員會或 SEC 提交的文件中，您可以從我們的網站 opireit.com 或 SEC 網站存取這些文件。投資者應注意不要過度依賴任何前瞻性陳述。

In addition, we will be discussing non-GAAP numbers during this call, including normalized funds from operations or normalized FFO, cash available for distribution or CAD, adjusted EBITDA, and cash basis net operating income or cash basis NOI. A reconciliation of these non-GAAP figures to net income are available in our supplemental operating and financial data package, which also can be found on our website.

此外，我們將在本次電話會議中討論非 GAAP 數據，包括標準化營運資金或標準化 FFO、可用於分配的現金或加幣、調整後的 EBITDA 以及現金基礎淨營業收入或現金基礎 NOI。這些非公認會計準則資料與淨利潤的對帳可在我們的補充營運和財務資料包中找到，這些資料包也可以在我們的網站上找到。

In addition, we will be providing guidance on this call, including normalized FFO and cash basis NOI. We are not providing a reconciliation of these non-GAAP measures as part of our guidance because certain information required for such reconciliation is not available without unreasonable efforts or at all, such as gains and losses or impairment charges related to the disposition of real estate.

此外，我們也將就本次電話會議提供指導，包括標準化 FFO 和現金制 NOI。作為我們指導的一部分，我們不會提供這些非公認會計原則措施的調節表，因為如果沒有不合理的努力，就無法獲得此類調節所需的某些信息，例如與房地產處置相關的損益或減值費用。

Now, I will turn the call over to Chris.

現在，我將把電話轉給克里斯。

Thank you, Olivia, and good morning. Welcome to the first quarter earnings call for Office Properties Income Trust. Yesterday, we reported normalized FFO of $1.28 per share, exceeding our expectation as well as consensus estimates for the quarter. We are encouraged by our first quarter activity on the heels of strong performance throughout 2020 and we continue to be well-positioned to advance our growth strategy and deliver value to our shareholders.

謝謝你，奧利維亞，早安。歡迎參加辦公地產收入信託第一季財報電話會議。昨天，我們公佈的正常化 FFO 為每股 1.28 美元，超出了我們的預期以及本季的普遍預期。繼 2020 年全年強勁業績之後，我們對第一季的活動感到鼓舞，我們將繼續處於有利地位，推進我們的成長策略並為股東創造價值。

Following our active capital recycling in 2020 and into 2021, we have over $930 million of liquidity to support our leasing, acquisition, and development activity. Despite the industry challenges presented by the COVID-19 pandemic, our portfolio continues to perform well, rent collections continue to trend above 99%, and we believe our portfolio composition and investment strategy will continue to benefit us.

經過 2020 年和 2021 年的積極資本回收，我們擁有超過 9.3 億美元的流動資金來支持我們的租賃、收購和開發活動。儘管 COVID-19 大流行帶來了行業挑戰，但我們的投資組合繼續表現良好，租金收取率繼續保持在 99% 以上的趨勢，我們相信我們的投資組合組成和投資策略將繼續使我們受益。

Turning to acquisitions and disposition activity. The market for acquisitions continues to improve and we are starting to see an increase in deal flow for opportunities that meet our investment criteria. We have been active with a handful of transactions and remain disciplined with what continues to be a competitive investment environment. Currently, we have an active acquisition pipeline that is trending in excess of $400 million for properties in various stages of consideration and look forward to providing additional updates as opportunities advance.

轉向收購和處置活動。收購市場持續改善，我們開始看到符合我們投資標準的機會的交易流量增加。我們一直積極進行一些交易，並在競爭激烈的投資環境中保持紀律。目前，我們擁有活躍的收購管道，處於不同考慮階段的房產的收購金額趨勢超過 4 億美元，並期待隨著機會的進展提供更多更新。

In 2021, we completed the sale of 3 properties for $117 million, which includes 2 previously disclosed properties sold in Kansas City, Missouri and Richmond, Virginia, for a combined $131 million. Along with the recent sale in April of a non-core property located in Huntsville, Alabama, that was a known vacate in the third quarter for $39 million dollars. The Huntsville sale eliminated the 1.4 million square foot potential drag on occupancy and significant anticipated capital and downtime for re-leasing. These efforts are aligned with our 2021 capital recycling plan focused on the disposition of $100 million to $300 million of properties, specifically buildings that are capital intensive, older buildings or sales that provide strategic value across the portfolio with the goal of investing these proceeds into newer less capital intensive buildings those intended to help reshape the tenant and geographic diversification or for opportunities to enhance yields to select development projects.

2021年，我們以1.17億美元的價格完成了3處房產的出售，其中包括先前披露的在密蘇裡州堪薩斯城和維吉尼亞州里士滿出售的兩處房產，總價為1.31億美元。加上最近 4 月出售的位於阿拉巴馬州亨茨維爾的一處非核心房產，該房產在第三季以 3,900 萬美元的價格出售。亨茨維爾的出售消除了 140 萬平方英尺的潛在入住率拖累以及大量預期資本和重新租賃的停機時間。這些努力與我們的2021 年資本回收計劃一致，該計劃的重點是處置1 億至3 億美元的房產，特別是資本密集型建築、舊建築或在整個投資組合中提供戰略價值的銷售，目標是將這些收益投資於更新的建築資本密集度較低的建築，旨在幫助重塑租戶和地理多元化，或尋求提高選定開發項目收益的機會。

Turning to leasing results for the quarter. While the long-term effects on the office real estate market remain uncertain, we continue to work closely with our tenant as they plan for re-entry and are encouraged by the momentum of our lease dialoguing activity. Current building utilization is 30% of our portfolio square footage, which we define as tenants that are utilizing at least 50% of their buildings. We anticipate tenants will continue to advance the re-entry plans into the third and fourth quarter and requirements for new and renewal leases will continue to accelerate consistent with the growing pipeline trends we have seen over the past several quarters.

轉向本季的租賃業績。儘管對辦公室房地產市場的長期影響仍不確定，但我們將繼續與租戶密切合作，因為他們計劃重新進入，並對我們的租賃對話活動的勢頭感到鼓舞。目前的建築利用率為我們投資組合面積的 30%，我們將其定義為使用至少 50% 建築面積的租戶。我們預計租戶將繼續將重新進入計劃推進到第三和第四季度，新租約和續租約的需求將繼續加速，這與我們在過去幾個季度中看到的不斷增長的管道趨勢一致。

During the first quarter, we completed 575,000 square feet of new and renewal leasing with a 3.2% roll-up in rent, a weighted average lease term of 5.4 years, and leasing concessions in capital commitments of $2.28 per square foot per lease year. We ended the quarter with consolidated occupancy of 90.8%. Activities for the quarter was mostly contributed by federal and state agencies including a 5-year renewal with the State of Washington for 112,000 square feet, a 10-year renewal with the Commonwealth of Massachusetts for 87,000 square feet, and a short-term renewal with the federal government at our buildings in Rockville, Maryland for 109,000 square feet.

第一季度，我們完成了 575,000 平方英尺的新租賃和續租租賃，租金上漲 3.2%，加權平均租賃期限為 5.4 年，資本承諾的租賃優惠為每個租賃年每平方英尺 2.28 美元。本季末，我們的綜合入住率為 90.8%。本季度的活動主要由聯邦和州機構提供，包括與華盛頓州續簽 112,000 平方英尺的 5 年期、與馬薩諸塞州續簽 87,000 平方英尺的 10 年期以及與聯邦政府位於馬裡蘭州羅克維爾的大樓，佔地109,000 平方英尺。

While leasing over the past year has mostly been concentrated around renewal activity, we are beginning to see more activity for new lease requirements across our vacancies. Our overall leasing pipeline remains robust with discussions covering 3.1 million square feet including roughly 106,000 square feet of new and renewal leasing signed since quarter end, 481,000 square feet of current activity that is in advanced stages of negotiation, and more than 950,000 square feet that could absorb vacant space. Potential absorption is mostly concentrated in our D.C. MSA including activity in our recently renovated building in Reston, Virginia.

雖然過去一年的租賃主要集中在續租活動，但我們開始看到更多針對空缺新租賃要求的活動。我們的整體租賃管道仍然強勁，討論面積達310 萬平方英尺，其中包括自季度末以來簽署的約106,000 平方英尺的新租賃和續租租賃、目前處於談判後期階段的481,000 平方英尺的租賃活動以及超過950,000 平方英尺的可能租賃活動。吸收空閒空間。潛在的吸收主要集中在我們的華盛頓特區 MSA，包括我們最近翻新的弗吉尼亞州雷斯頓大樓的活動。

At the same time, we are also encouraged by the uptick in tour activity across our portfolio. We believe we are well-positioned to continue to advance leasing of our vacant space given the quality of the building and their locations, including markets such as Phoenix, Arizona, San Jose, California, suburban Boston, and Northern Virginia. Each of these markets embody unique demand drivers around industry diversification, metros of higher education attainment, demographic and technology shifts in supporting economic activity many of which are considerations we value for continued growth within our portfolio.

同時，我們的投資組合中旅遊活動的增加也令我們感到鼓舞。我們相信，鑑於建築物的品質及其位置，包括鳳凰城、亞利桑那州、聖荷西、加州、波士頓郊區和北維吉尼亞州等市場，我們有能力繼續推進空置空間的租賃。這些市場中的每一個都體現了圍繞行業多元化、高等教育程度的衡量標準、支持經濟活動的人口和技術轉變的獨特需求驅動因素，其中許多都是我們在投資組合中持續增長時所重視的考慮因素。

Further, we continue to make progress with our previously disclosed known vacates for 2021, which includes the mentioned sale of our property in Huntsville, Alabama, additional updates are as follows: In our Plantation, Florida property, the GSA lease expires in April and represents 80 basis points of annualized revenue. We have previously disclosed the tenant vacating upon expiration, however, this tenant has since elected to hold over for up to 12 months and we anticipate continued occupancy through Q4 2021. Despite this holdover, activity for private sector leasing has been strong with several larger users having acquired into the building.

此外，我們繼續在先前披露的2021 年已知騰出事宜上取得進展，其中包括上述出售我們在阿拉巴馬州亨茨維爾的房產，其他更新如下：在我們佛羅裡達州種植園的房產中，GSA租約將於4 月到期，代表年化收入80個基點。我們之前曾披露過租戶在到期後騰出的情況，但是，該租戶此後選擇保留最長12 個月，我們預計到2021 年第四季度將繼續入住。儘管有這種保留，但私營部門的租賃活動仍然強勁，有幾個較大的用戶已進入建築物。

With our property and Fresno, California, the GSA is scheduled to expire in November reflecting 1.5% of annualized revenue. Plans for the tenant to vacate remain. However, we are actively marketing the property for sale and we anticipate an update on our marketing efforts will be available on future quarter. And lastly, for our property located at 20 Massachusetts Avenue in Washington, D.C., the tenant representing 2.8% of our annualized revenue has vacated the building on March 31st as originally disclosed and plans continue for advancements of our redevelopment of this property. We continue to work through our plan and look forward to providing progress updates on activity as it materializes.

對於我們的酒店和加州弗雷斯諾，GSA 計劃於 11 月到期，反映年化收入的 1.5%。租戶搬出的計劃仍然存在。然而，我們正在積極行銷待售物業，預計我們的行銷工作的最新資訊將在未來季度發布。最後，對於我們位於華盛頓特區馬薩諸塞大道20 號的房產，占我們年化收入2.8% 的租戶已按照最初披露的那樣於3 月31 日騰出該大樓，併計劃繼續推進我們對該房產的重新開發。我們將繼續執行我們的計劃，並期待在計劃落實時提供活動的最新進展。

Overall, we are pleased with the activity we're seeing across the portfolio and trends of 3 consecutive quarters where our leasing pipeline exceeded 3 million square feet. Before I turn the call over to Matt, I would like to highlight that OPI recently received the 2021 ENERGY STAR Partner of the Year Sustained Excellence Awards. This is the fourth consecutive year that we have achieved Partner of the Year recognition and the second year, we have earned the Sustained Excellence designation in the energy management category. We are proud of this effort and commitment to our sustainability initiatives across the RMR organization.

總體而言，我們對整個投資組合的活動和連續 3 個季度的趨勢感到滿意，我們的租賃管道超過 300 萬平方英尺。在將電話轉給 Matt 之前，我想強調一下，OPI 最近獲得了 2021 年能源之星年度持續卓越合作夥伴獎。這是我們連續第四年獲得年度合作夥伴認可，也是我們第二年獲得能源管理類別的持續卓越獎。我們為整個 RMR 組織的這項努力和對永續發展計劃的承諾感到自豪。

I will now turn the call over to Matt Brown to provide details on our financial results. Matt?

我現在將把電話轉給馬特布朗，以提供有關我們財務業績的詳細資訊。馬特？

Thanks, Chris, and good morning, everyone. Normalized FFO for the first quarter was $61.8 million or $1.28 per share, which beat consensus and the high end of our estimate by $0.04 mainly due to NOI coming in higher than forecasted. CAD for the first quarter was $47.7 million or $0.99 per share. Our dividend is well covered with the rolling forward quarter CAD payout ratio of 59%.

謝謝克里斯，大家早安。第一季標準化 FFO 為 6,180 萬美元，即每股 1.28 美元，比市場預期和我們預期的上限高出 0.04 美元，這主要是由於 NOI 高於預期。第一季加幣為 4,770 萬美元，即每股 0.99 美元。我們的股息得到了充分支付，未來季度的加元派息率為 59%。

G&A expense for the first quarter was $11.3 million, which includes $5.2 million of estimated business management incentive fees. Excluding the estimated incentive fee, G&A expense was $6.1 million compared to $7.1 million for both the same period last year and the prior quarter, neither of which included any estimated incentive fee expense. The decline sequentially is mainly due to elevated costs in the prior quarter due to share grant accelerations from the retirement of 3 RMR officers and $450,000 of rent expense related to a lease obligation that expired on January 31st as discussed last quarter, which resulted in a favorable impact of $300,000 in the first quarter.

第一季的一般管理費用為 1,130 萬美元，其中包括預計的 520 萬美元的業務管理激勵費用。不包括估計的獎勵費用，一般管理費用為 610 萬美元，而去年同期和上一季的管理費用為 710 萬美元，其中均不包括任何估計的獎勵費用。環比下降的主要原因是上一季的成本上升，這是由於3 名RMR 官員退休導致股份授予加速，以及與上季度討論的1 月31 日到期的租賃義務相關的450,000 美元租金費用，這導致了有利的業績第一季的影響為 300,000 美元。

Incentive fees under our business management agreement with RMR are payable after the end of each calendar year in which they are earned but are recognized in the calculation of net income in accordance with GAAP in the first, second, and third quarters if applicable. We do not include such expense in adjusted EBITDAre or normalized FFO until the fourth quarter when the final incentive fee amount is determined.

根據我們與RMR 的業務管理協議，獎勵費用應在賺取獎勵的每個日曆年結束後支付，但如果適用，則根據公認會計原則在第一、第二和第三季度的淨利潤計算中予以確認。在第四季度確定最終激勵費用金額之前，我們不會將此類費用計入調整後的 EBITDAre 或標準化 FFO 中。

The incentive fee accrued in the first quarter is based on OPI's total return in comparison to the SNL U.S. REIT Office Index over the 3-year measurement period, which commenced on January 1, 2019. OPI outperformed the index by approximately 15% with a total return of 22.4%. This equates to an annualized estimated incentive fee of $20.8 million, which represents the cap of 1.5% of our equity market capitalization. The incentive fee accrual may increase or decrease over the remainder of the year depending on how OPI performs relative to the index.

第一季應計的激勵費是基於OPI 的總回報率與SNL 美國REIT Office 指數在2019 年1 月1 日開始的3 年衡量期內的總回報率進行比較。OPI 的表現優於該指數約15%，總回報率回報率為22.4%。這相當於年化激勵費估計為 2,080 萬美元，占我們股票市值的 1.5% 上限。在今年剩餘時間內，應計獎勵費用可能會增加或減少，具體取決於 OPI 相對於指數的表現。

Interest expense for the first quarter was $28.8 million, which was flat sequentially and up $1.6 million from the prior-year period, primarily due to proceeds from the issuance of $412 million of unsecured senior notes in 2020 that were used to repay amounts outstanding on our revolving credit facility, partially offset by secured debt repayments of $152 million during 2020.

第一季的利息支出為2,880 萬美元，與上一季持平，比上年同期增加160 萬美元，主要是由於2020 年發行4.12 億美元無擔保優先票據的收益，這些票據用於償還我們的未償還金額。循環信貸安排，部分被 2020 年 1.52 億美元的擔保債務償還所抵銷。

Turning to property level results for the quarter. Same property cash basis NOI decreased $1.6 million or 1.8% compared to the first quarter of 2020, slightly outperforming our guidance range of negative 2% to 4%. As expected, the decrease was mainly driven by a reduction in rental income of $1.4 million, most notably due to the tailored brand lease restructure and a decline in parking revenue of $690,000 due to the pandemic, as well as an increase in snow removal costs of $1 million, partially offset by lower utility and maintenance cost.

轉向本季的房地產水平結果。與 2020 年第一季相比，相同財產現金基礎 NOI 下降 160 萬美元，即 1.8%，略高於我們負 2% 至 4% 的指導範圍。正如預期，這一下降主要是由於租金收入減少了 140 萬美元，其中最明顯的是由於定制的品牌租賃重組和大流行導致的停車收入減少了 69 萬美元，以及除雪成本的增加100 萬美元，部分被公用事業和維護成本降低所抵消。

Turning to normalized FFO and same property cash basis NOI expectations. We expect second quarter normalized FFO to be between $1.11 and $1.13 per share. As highlighted on last quarter's call, the most significant declines from Q1 are driven by the following. $0.08 due to the expiration of the GSA lease at 20 Massachusetts Avenue, $0.05 due to the dispositions of our Huntsville, Alabama property in April and our Richmond, Virginia property in January and other known vacancies we have discussed, and $0.02 due to trustee compensation expense in Q2 and higher business management fees based on our current share price. We expect second quarter same property cash basis NOI to decline between 3.5% and 5.5% as compared to the second quarter of 2020.

轉向正常化的 FFO 和相同的房地產現金基礎 NOI 預期。我們預計第二季標準化 FFO 將為每股 1.11 美元至 1.13 美元之間。正如上季電話會議所強調的，第一季最顯著的下降是由以下因素驅動的。 0.08 美元是由於馬薩諸塞大道20 號的GSA 租約到期，0.05 美元是由於4 月份處置我們阿拉巴馬州亨茨維爾的房產和1 月份弗吉尼亞州里士滿的房產以及我們討論過的其他已知空缺，0.02 美元是由於受託人補償費用根據我們目前的股價，第二季和更高的業務管理費。我們預計第二季相同房地產現金基礎 NOI 將比 2020 年第二季下降 3.5% 至 5.5%。

Turning to capital expenditures in the balance sheet. We spent $11.5 million on recurring capital during the first quarter and we expect recurring capital expenditures for the full year to be between 75 and $80 million. At March 31, our leverage was 5.7x. We currently have more than $930 million of liquidity including full availability under our $750 million revolving credit facility. We have no debt maturities until February 2022 when $300 million of unsecured senior notes mature which will come pre-payable without penalty in December 2021. In closing, our balance sheet remains strong and despite pressures from the 2021 vacancies that we have discussed, we expect our dividend to remain well covered.

轉向資產負債表中的資本支出。第一季我們在經常性資本上花費了 1,150 萬美元，我們預計全年的經常性資本支出將在 7,500 至 8,000 萬美元之間。截至 3 月 31 日，我們的槓桿率為 5.7 倍。我們目前擁有超過 9.3 億美元的流動資金，包括 7.5 億美元循環信貸額度下的全部可用資金。在2022 年2 月之前，我們沒有債務到期，屆時3 億美元的無擔保優先票據到期，這些票據將在2021 年12 月提前支付，無需支付罰款。最後，我們的資產負債表仍然強勁，儘管我們已經討論過2021 年職缺帶來的壓力，但我們預計我們的股息將保持良好。

Operator, that concludes our prepared remarks, we're ready to open the call up for questions.

接線員，我們準備好的發言到此結束，我們準備開始提問。

(Operator Instructions) Our first question comes from Bryan Maher with B. Riley FBR.

（操作員說明）我們的第一個問題來自 Bryan Maher 和 B. Riley FBR。

Good morning, guys. Appreciate all that color. Couple of quick questions. On the Boston property that you bought, we noticed it's 45% leased currently, 2 questions on that. Is there any opportunity to increase that occupancy until you move towards redevelopment or should we just expect it to stay there? And secondly, is that occupancy, did that kind of weigh down the portfolio, we noticed a modest downtick in total portfolio occupancy, is Boston responsible for that?

早上好傢伙。欣賞所有這些顏色。幾個簡單的問題。關於您購買的波士頓房產，我們注意到目前 45% 已出租，有 2 個問題。在進行重建之前是否有機會增加入住率，還是我們應該期望它留在那裡？其次，這種佔用率是否會壓低投資組合，我們注意到投資組合總佔用率略有下降，波士頓是否為此負責？

Bryan, this is Chris. I think on the first part of your question, certainly, the goal is to go after short-term leases in the interim while we evaluate a larger plan for the consolidated assets that we put together in Boston. So I think some of the space within that building is relatively turnkey, so we expect that what we won't challenge to maybe able to kind of improve leasing on a short-term basis for that project. And then with respect to occupancy, no, I wouldn't say that, that project would limit our occupancy. I mean that's still a bit close in May. And then I think from the change in occupancy from Q4 to Q1, it's really driven by some known move-outs at a building in the Chicago sub-market where 2 tenants vacated. One vacated just as part of its natural expiration and the other vacated given in part of a renewal and downside. So we've got a long-term renewal on a larger portion of the space in the balance the downsize vacated.

布萊恩，這是克里斯。我認為，關於你問題的第一部分，當然，我們的目標是在過渡期間追求短期租賃，同時我們評估我們在波士頓整合的資產的更大計劃。因此，我認為該建築內的某些空間相對來說是交鑰匙的，因此我們預計我們不會挑戰的內容也許能夠在短期內改善該項目的租賃。然後就入住率而言，不，我不會說，該項目會限制我們的入住率。我的意思是，距離五月還很近。然後我認為，從第四季度到第一季的入住率變化來看，這實際上是由芝加哥子市場的一棟大樓的一些已知遷出事件推動的，其中有 2 名租戶搬出。一個是由於其自然到期而騰空，另一個是由於續約和下行而騰空。因此，我們對縮小規模後騰出的大部分空間進行了長期更新。

And then, thanks for that update on the 4 big properties for this year. But on Mass Ave, with that property now vacated, I'm assuming you guys are definitively moving forward with the redevelopment, correct me if I'm wrong there. And if that's the case, can you give us an update at -- on your thoughts on cost and timing, has that changed since you last discussed it?

然後，感謝您今年四大房產的更新。但在 Mass Ave，隨著該房產現已空出，我假設你們肯定會繼續進行重建工作，如果我錯了，請糾正我。如果是這樣的話，您能否向我們介紹您對成本和時間安排的最新想法，自您上次討論以來，情況是否發生了變化？

Yes, the plan right now is to continue to move forward and with respect to timing, this is looking for a Q1 2023 deliverable. And total construction costs are about $150 million and then with leasing, it's upwards of about $200 million. And we were targeting about an 8% to 10% cash return.

是的，現在的計劃是繼續向前推進，就時間而言，我們正在尋找 2023 年第一季的交付成果。總建築成本約 1.5 億美元，加上租賃成本，則高達約 2 億美元。我們的目標是 8% 到 10% 的現金回報率。

And then last for me. You touched upon your acquisition pipeline. I think you might have said it's around $400 million. How competitive is the bidding there, and -- on cap-rate basis and is that expected to grow meaningfully, the potential opportunity and do you see the cap-rate shifting up or down with what's going on, bigger picture in the economy, and all the discussion regarding the needs for office space?

然後最後對我來說。您談到了您的收購管道。我想你可能會說大約是 4 億美元。那裡的投標競爭力如何，以及——在上限利率的基礎上，預計會有意義地增長，潛在的機會，你認為上限利率會隨著正在發生的事情、更大的經濟形勢而上下變化嗎？所有關於辦公空間需求的討論？

Yes. I mean, I think the cap rates for the type of assets that we're looking at, those kind of with long-term leases, credit tenants, or other synergies around markets have continued to remain competitive. And so, there's not been a material shift in cap rates other than just a lot of capital chasing similar type assets. And so I would say that for some of the assets that we've been looking at and active on the smaller deals just have a lot of different type of buyer taking that, and so it just becomes extremely competitive. And then some of the larger deals, I think it's very similar but cap rates are really going to be consistent based on marketing and kind of some of the parameters around that. I think we've targeted cap rates in 6% to 7%. I think we showed some of that with the acquisition in Q4 of the building up in the Charlotte, MSA. But as we look at other opportunities, I mean we're seeing cap rates that are 5% and 6% as well. So I think it's really kind of part of a multi-tier strategy where we're going to stop buying some properties that are at lower and others that are at the higher range, just to kind of get to the balance we're looking for.

是的。我的意思是，我認為我們正在關注的資產類型的資本化率，即那些具有長期租賃、信貸租戶或市場其他協同作用的資產，繼續保持競爭力。因此，除了大量資本追逐類似類型的資產外，資本化率並沒有重大變化。因此，我想說，對於我們一直在關注並積極參與較小交易的一些資產，只有許多不同類型的買家接受，因此它變得極具競爭力。然後是一些較大的交易，我認為非常相似，但根據行銷和相關的一些參數，資本化率確實會保持一致。我認為我們的上限利率目標是 6% 至 7%。我認為我們透過第四季度收購 MSA 夏洛特的建築展示了其中的一些內容。但當我們考慮其他機會時，我的意思是我們看到的資本化率也達到了 5% 和 6%。所以我認為這確實是多層策略的一部分，我們將停止購買一些價格較低的房產和其他價格較高的房產，只是為了達到我們正在尋找的平衡。

The next question is from Elvis Rodriguez with Bank of America.

下一個問題來自美國銀行的艾維斯·羅德里格斯。

On your lease percentage went down, but yet you had the big tenant move-out at quarter end. I'm just curious, was that tenant included in the numbers or not included in the numbers? Just want to make sure.

你的租賃百分比下降了，但季度末仍有大量租戶搬出。我只是好奇，那個租戶是包含在數字中還是不包含在數字中？只是想確定一下。

When do you say the occupancy went down?

你說入住率什麼時候下降了？

The lease percentage went down about 40 basis points but you lost, call it a 220 basis point tenant at the end of the quarter, but just want to make sure if that tenant is included in the numbers or not and should we see that come out in 2Q?

租賃百分比下降了約 40 個基點，但你輸了，在季度末稱其為 220 個基點租戶，但只是想確定該租戶是否包含在數字中，我們是否應該看到結果在第二季度？

Yes. I mean I think that for the quarter with that March 31st expiration, we recognize that through quarter end, and so we'll see that drop off in Q2.

是的。我的意思是，我認為對於 3 月 31 日到期的季度，我們在季度末認識到這一點，因此我們將在第二季度看到這一下降。

And then, with that, are you able to share trajectory of what will happen with occupancy throughout the year? Obviously, it's going to dip in 2Q but where do you see sort of occupancy ending at the end of the year?

那麼，您是否能夠分享全年入住率的變化軌跡？顯然，第二季的入住率將會下降，但您認為年底入住率會如何？

I mean at the end of the year, there's a couple of different factors that are going to impact that. Kind of most notably around some of the dispositions that we're looking at. We've talked about Fresno, that's 500,000 square feet, and so certainly, if that building transact, that will have a favorable impact to occupancy, if vacate in November, that will have a negative impact on occupancy. But I think right now with that set aside, I think occupancy for us is looking at 89%, 90%, assuming kind of all other factor are working.

我的意思是，到今年年底，有幾個不同的因素會影響這一點。最值得注意的是我們正在研究的一些配置。我們討論過弗雷斯諾，面積為 500,000 平方英尺，因此，如果該建築進行交易，將對入住率產生有利影響，如果在 11 月騰空，則會對入住率產生負面影響。但我認為現在拋開這一點，假設所有其他因素都起作用，我認為我們的入住率約為 89%、90%。

And then I just have a couple of more questions but I'm happy to hop in the queue after this next one. You took a $0.16 impairment in the quarter, I know you highlighted a bit on it in the Q. But maybe if you can share any details just so we have it here on the call that would be helpful.

然後我還有幾個問題，但我很高興在下一個問題之後加入隊列。您在本季度遭受了 0.16 美元的減值，我知道您在問題中強調了這一點。但也許如果您可以分享任何細節，以便我們在電話會議上了解它，那將會有所幫助。

Yes. The impairment charge in the quarter was related to the 2 properties that we had classified as held for sale at quarter end, one of which was the Huntsville, Alabama property that we sold in April for $39 million.

是的。本季的減損費​​用與我們在季度末歸類為待售的兩處房產有關，其中之一是我們在 4 月以 3,900 萬美元的價格出售的阿拉巴馬州亨茨維爾的房產。

Thanks. I'll hop in the queue.

謝謝。我會插隊。

The next question is from Jason Idoine with RBC Capital Markets.

下一個問題來自 RBC 資本市場的 Jason Idoine。

I had a question just on the Boston acquisition. So I guess last quarter you guys acquired the property in Boston that was close to or sharing walls with one of your existing properties and it looks like this quarter you did as well. Both last quarter and this quarter, the occupancy rate on those 2 properties was lower. So I guess is this new acquisition in that same area with the one from last quarter in your existing assets and I guess if you are building scale there, what's the long-term goal?

我有一個關於波士頓收購的問題。所以我想上個季度你們在波士頓購買了靠近您現有房產或與現有房產共用牆壁的房產，看起來本季你們也這樣做了。上季和本季，這兩個物業的入住率均較低。因此，我想這次新收購是否與您現有資產上一季的收購在同一領域，我想如果您正在那裡擴大規模，長期目標是什麼？

So acquisition is one and the same, it's just been delayed with respect to closing given some ongoing diligence at the property. So it's the same asset. And then really what this does is that gives us about 0.7 acre within kind of a combined parcel, and I think the goal is just to evaluate what our options are. I mean we do have leases in place with the adjoining buildings that has some term on them, which gives us plenty of runway to evaluate decisions and see where the market goes. So in the near term, I think we would benefit from those in-place leases while we kind of evaluate plan. And so my guess is that any updates on opportunity for this project are likely going to be something we would see maybe next year. But a brief -- a major repositioning here is pretty far out still.

因此，收購是一回事，只是由於對該物業正在進行的一些調查，交割被推遲了。所以這是同一個資產。這樣做的真正作用是在一個合併的地塊內為我們提供了大約 0.7 英畝的土地，我認為目標只是評估我們的選擇是什麼。我的意思是，我們確實與毗鄰的建築物簽訂了租約，這些租約有一定期限，這為我們提供了充足的跑道來評估決策並了解市場走向。因此，在短期內，我認為在我們評估計劃的同時，我們將從這些就地租賃中受益。所以我的猜測是，我們明年可能會看到有關該專案機會的任何更新。但簡單來說，這裡的重大重新定位還很遙遠。

Okay. And then could you provide some color on the leasing pipeline? It sounds like it dropped about 700,000 square feet since last quarter. So just wondering if that's all due to leasing activity.

好的。那麼您能否提供一些有關租賃管道的資訊？聽起來自上季以來面積減少了約 70 萬平方英尺。所以只是想知道這是否都是由於租賃活動造成的。

Yes, it is. I mean I think in part we converted $575,000 to executed deals, and so we're left with the $3.1 million. And so that pipeline generally ebb and flows but as I noted, I think it's been consistently above $3 million for 3 quarters which is on the high end of the range when you kind of look back over the last couple of years.

是的。我的意思是，我認為我們將 575,000 美元轉換為已執行的交易，因此我們剩下 310 萬美元。因此，管道通常會潮起潮落，但正如我所指出的，我認為這三個季度一直高於 300 萬美元，當你回顧過去幾年時，這是該範圍的高端。

The next question is from Vikram Malhotra with Morgan Stanley.

下一個問題來自摩根士丹利的 Vikram Malhotra。

Maybe just first to clarify on the CapEx that you plan for this year. I think it's modestly lower than the last call where you had said about $85 million. So just wondering if there has been a push out or just a change in plans, what's the difference?

也許首先要澄清一下您今年計劃的資本支出。我認為這比上次電話中所說的大約 8500 萬美元要低一些。所以只是想知道是否有推遲或只是計劃發生了變化，有什麼區別？

Yes. The different really timing of expected leasing capital being pushed out that's really caused the number to come down $5 million to $10 million from our initial projection.

是的。預期租賃資本推出的時間不同，導致這一數字比我們最初的預測下降了 500 萬至 1000 萬美元。

And then the occupancy target that you have, does that assume the sale of certain assets, specifically Fresno?

然後，您的入住率目標是否假設出售某些資產，特別是弗雷斯諾？

Not Fresno. There are some assets in the pipeline albeit much smaller in size but that does not assume Fresno. So I think that Fresno would increase or help increase the occupancy as that will trend.

不是弗雷斯諾。有一些資產正在醞釀中，儘管規模要小得多，但這並不假設弗雷斯諾。因此，我認為弗雷斯諾將增加或幫助增加入住率，因為這是趨勢。

Increase. Okay. That makes sense. And then just 2 more quick ones. Just overall, the incentive fees that you had this quarter, I know it's a calculation every quarter but if you include the incentive fees assuming like in next 2 quarters you still have to -- there is still an allocation, what is the dividend kind of coverage post the incentive fees?

增加。好的。這就說得通了。然後還有 2 個更快的。總的來說，你本季的激勵費用，我知道這是每個季度都要計算的，但如果你包括激勵費用，假設接下來的兩個季度你仍然需要——仍然有分配，股息是多少覆蓋範圍後獎勵費用？

Sure. So our year-end projection right now including the 2020 $8 million dollar incentive fee with the payout ratio of about 84%. Excluding the incentive fee, that payout ratio will be about 72%.

當然。因此，我們現在的年終預測包括 2020 年 800 萬美元的激勵費，支付率約為 84%。剔除激勵費後，支付率約 72%。

Got it. And that's on a FAD or a CAD basis?

知道了。這是基於 FAD 還是 CAD ？

That's right.

這是正確的。

Okay. And then just last one. If you could just clarify are you outlined, obviously, last quarter all the vacates, but I'm just wondering over the next like 12 to 18 months, have there been any moving pieces to the vacates that you had outlined last quarter? If you could just clarify the larger ones in the magnitude.

好的。然後就是最後一張。如果您能澄清一下，顯然您是否概述了上季度的所有空缺，但我只是想知道在接下來的 12 到 18 個月內，您上季度概述的空缺是否有任何變動？如果你能澄清一下規模較大的那些。

Yes. I mean, I think last quarter we talked about the known vacates and where we are today for 2021, where that 7.2% of annualized revenue is still the target and again that's going to come down as the 20 Mass Ave kicks in with the next quarter. And really the 4 assets that we continue to go talk about represent over 6% of that total number. So other than that, it's just smaller moving pieces across the portfolio. So that's what we expect for 2021.

是的。我的意思是，我認為上個季度我們討論了已知的空缺以及2021 年的情況，年化收入的7.2% 仍然是目標，隨著20 Mass Ave 下個季度的啟動，這一目標將會再次下降。事實上，我們繼續討論的 4 種資產佔總數的 6% 以上。除此之外，它只是整個投資組合中較小的移動部分。這就是我們對 2021 年的預期。

The next question is from Omotayo Okusanya with Mizuho.

下一個問題來自 Mizuho 的 Omotayo Okusanya。

Yes, the $3 million leasing pipeline, could you point that out in regards to what's new leasing versus what's the potential renewals?

是的，300 萬美元的租賃管道，您能否指出新租賃和潛在續租的情況？

So it's probably 60-40. So 60% renewal, 40% new leasing.

所以大概是60-40。所以 60% 續租，40% 新租賃。

And then the Bank of America lease, the -- 1 of your top 5 tenants, it looks like there was a sequential decline in the annualized rent. Was there a reduction of space associated with BoA?

然後是美國銀行的租賃，您的前 5 位租戶之一，看起來年化租金連續下降。與 BoA 相關的空間是否減少了？

Yes. Bank of America was one of the tenants that expired 12/31, which was a known vacate. And so that was I think close to 40,000 square feet or $700,000 that fell off at year-end.

是的。美國銀行是 12 月 31 日到期的租戶之一，這是已知的空缺。我認為年底時損失了近 40,000 平方英尺或 700,000 美元。

Then just to clarify, they renewed but took less space going forward or just is that what happened?

然後澄清一下，他們續約了，但接下來佔用的空間更少了，還是這就是發生的事情？

Can you repeat that?

你可以再說一次嗎？

Well, is that they just moved out of that particular space and the remaining balances for other space to have within the portfolio?

那麼，他們是否剛剛搬出該特定空間，並將剩餘餘額移至投資組合內的其他空間？

Correct, yes. So Bank of America, we have various locations with them, and so that was one of the spaces that they moved out of.

正確，是的。美國銀行，我們在不同的地點與他們合作，這就是他們搬出去的地方之一。

The next question is a follow-up from Elvis Rodriguez with Bank of America.

下一個問題是美國銀行艾維斯羅德里格斯 (Elvis Rodriguez) 的後續問題。

Just one more on the incentive fees being backed out of FFO. Can you just share what you've done historically with these incentive fees and how you'll recognize these in the future?

再談 FFO 取消的激勵費用。您能否分享一下您過去使用這些獎勵費用所做的事情以及您將來如何認識這些費用？

Sure. So for recognition in net income, the $5.2 million is part of that which is the accrual at 3/31. We don't include any estimated incentive fees in Q1, Q2 or Q3 in our normalized FFO or adjusted EBITDAre metrics, because they're just estimates during the quarters and the fee can be pretty volatile quarter to quarter depending on our share price performance relative to the peer group. So when we calculate our final fee at the end of December 31st, of this year, any fee will then be deducted from normalized FFO and adjusted EBITDAre at that time.

當然。因此，對於淨收入的確認，520 萬美元是 3/31 應計收入的一部分。我們的標準化 FFO 或調整後的 EBITDAre 指標中沒有包含第一季、第二季或第三季的任何估計激勵費用，因為它們只是季度期間的估計，而且費用可能會根據我們的股價表現相對波動。到同儕群體。因此，當我們在今年 12 月 31 日計算最終費用時，任何費用都將從當時的標準化 FFO 和調整後 EBITDA 中扣除。

So we should see -- so we should be adjusting our models for call it, a $20 million fee in 4Q, is that correct?

所以我們應該看到 - 所以我們應該調整我們的模型，第四季度收取 2000 萬美元的費用，對嗎？

That's right, yes.

沒錯，是的。

This concludes our question-and-answer session. I would like to turn the conference back over to Chris Bilotto for any closing remarks.

我們的問答環節到此結束。我想將會議轉回克里斯·比洛托 (Chris Bilotto) 發表閉幕詞。

Thank you for joining us today. We look forward to updating you on our progress this year and hope to see many of you at the upcoming conferences and events.

感謝您今天加入我們。我們期待向您通報我們今年的最新進展，並希望在即將舉行的會議和活動中見到您。

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

會議現已結束。感謝您參加今天的演講。您現在可以斷開連線。