Prologis Inc (PLD) 2024 Q2 法說會逐字稿

Welcome to the Prologis second quarter 2024 earnings conference call. (Operator Instructions) As a reminder, this conference is being recorded. I'd now like to turn the call over to Justin Meng, Senior Vice President, Head of Investor Relations. Thank you. You may begin.

歡迎參加普洛斯 2024 年第二季財報電話會議。 （操作員指示）謹此提醒，本次會議正在錄製中。我現在想把電話轉給高級副總裁兼投資者關係主管賈斯汀孟。謝謝。你可以開始了。

Thanks, Darryl. Good morning, everyone. Welcome to our second quarter 2024 earnings conference call. The supplemental document is available on our website at prologis.com under Investor Relations.

謝謝，達裡爾。大家，早安。歡迎參加我們的 2024 年第二季財報電話會議。補充文件可在我們的網站 prologis.com 的「投資者關係」下取得。

I'd like to state that this conference call will contain forward-looking statements under federal securities laws. These statements are based on current expectations, estimates, and projections about the market and the industry in which Prologis operates as well as management's beliefs and assumptions.

我想聲明的是，本次電話會議將包含聯邦證券法規定的前瞻性聲明。這些陳述是基於對普洛斯經營所在市場和行業的當前預期、估計和預測以及管理層的信念和假設。

Forward-looking statements are not guarantees of performance and actual operating results may be affected by a variety of factors. For a list of those factors, please refer to the forward-looking statements notice in our 10-K or other SEC filings. Additionally, our second quarter earnings press release and supplemental do contain financial measures such as FFO and EBITDA that are non-GAAP. And in accordance with Reg G, we have provided a reconciliation to those measures.

前瞻性陳述並非績效保證，實際經營結果可能會受到多種因素的影響。有關這些因素的列表，請參閱我們的 10-K 或其他 SEC 文件中的前瞻性聲明通知。此外，我們的第二季財報新聞稿和補充資料確實包含非 GAAP 財務指標，例如 FFO 和 EBITDA。根據 Reg G，我們對這些措施進行了調節。

I'd like to welcome Tim Arndt, our CFO, who will cover results, real-time market conditions and guidance. Hamid Moghadam, our Founder and CEO; Dan Letter, our President; and Chris Caton, Managing Director, are also with us today.

我要歡迎我們的財務長 Tim Arndt，他將介紹業績、即時市場狀況和指導。 Hamid Moghadam，我們的創辦人兼執行長；丹‧萊特，我們的總裁；董事總經理 Chris Caton 今天也與我們同在。

With that, I'll hand the call over to Tim.

這樣，我就把電話轉給提姆。

Thank you, Justin, and thank you all for joining our call. We had solid execution against second quarter plan, which showed improvement over the first quarter, underpinned by a pickup in overall market activity. In fact, we released 52 million square feet in our portfolio, a 27% increase over the first quarter and one of our highest quarters in the past few years. This helped in delivering occupancy, which outperformed our forecast, and more importantly, rent change well over 70%. This was achieved in an environment where decision making has remained slow as many customers optimize existing footprints before committing to new space.

謝謝賈斯汀，也謝謝大家加入我們的電話會議。我們對第二季計畫的執行情況良好，在整體市場活動回升的支撐下，第二季計畫比第一季有所改善。事實上，我們的投資組合釋放了 5,200 萬平方英尺的面積，比第一季成長了 27%，是過去幾年來最高的季度之一。這有助於提高入住率，超越我們的預測，更重要的是，租金變化遠超過 70%。這是在決策仍然緩慢的環境中實現的，因為許多客戶在投入新空間之前優化了現有的佔地面積。

As a result, we expect many property owners to continue to prioritize occupancy in select markets with higher availability, keeping pressure on rents. That said, the bright spot continues to be the depletion of the supply pipeline and successive quarters of very low development starts. We believe we are near peak vacancy in this dearth of new supply, setting the stage for more favorable conditions in 2025. As evidenced by very strong rent change this quarter, our lease mark to market is serving to sustain meaningful growth through this transition.

因此，我們預計許多業主將繼續優先考慮可用性較高的特定市場的入住，從而維持租金壓力。儘管如此，亮點仍然是供應管道的枯竭和連續幾個季度的開發開工率非常低。我們相信，在新供應短缺的情況下，我們的空置率已接近峰值，為2025 年更有利的條件奠定了基礎。在這轉型過程中維持有意義的成長。

In terms of results for the quarter, core FFO excluding promotes was $1.36 per share and including net promote expense was $1.34 per share. We earned promote revenue within our fee per vehicle in Mexico, marking the 7th year of such achievements since its IPO and speaking to the high quality of our portfolio and team in that market.

就本季業績而言，不包括促銷費用的核心 FFO 為每股 1.36 美元，包括淨促銷費用為每股 1.34 美元。我們在墨西哥以每輛車的費用賺取了推廣收入，這是自 IPO 以來第七年取得這樣的成就，並證明了我們在該市場的產品組合和團隊的高品質。

Global occupancy at our share ended the quarter at 96.5%. Our US portfolio continues to outperform the market by over 320 basis points, a meaningful spread that has widened from our historic norm of roughly 175 basis points. As vacancy normalizes in our markets, we expect this flight to quality and to continue.

本季末，我們的全球入住率為 96.5%。我們的美國投資組合持續跑贏市場超過 320 個基點，這一利差較我們約 175 個基點的歷史標準有所擴大。隨著我們市場的空缺正常化，我們預計這種向高品質發展的趨勢將持續下去。

We crystallized $100 million of our lease mark to market during the quarter. As of June, we estimate that the net effective market rents are 42% above in-place rents, representing $2 billion of potential NOI. Over 40% of the decline in our lease mark-to-market ratio is due to this quarter's mark to market capture.

本季我們將 1 億美元的租賃標價具體推向市場。截至 6 月，我們估計淨有效市場租金比現有租金高出 42%，相當於 20 億美元的潛在 NOI。我們的租賃按市值比率下降 40% 以上是由於本季度的按市值捕獲。

Net effective rent change was nearly 74% based on commencement and is 64% based on new signings. This metric can be volatile between quarters due to mix. But we continue to expect full year net effective rent change to be above 70%, illustrating the outsized mark to market opportunity that will remain in the near and intermediate term.

根據開業計算，淨有效租金變動接近 74%，根據新簽約計算，淨有效租金變動為 64%。由於混合，該指標在季度之間可能會波動。但我們仍然預計全年淨有效租金變化將超過 70%，這表明短期和中期仍將存在巨大的市場機會。

Our same-store growth was 7.2% on a cash basis, 5.5% on a net effective basis, each strong despite the impact of over 100 basis points of decline in average occupancy year over year, as well as the effect of fair value lease adjustments on net effective growth from the Duke acquisition. We deployed over $700 million into new development projects and acquisitions during the quarter and also closed on over $1 billion in dispositions and contributions at values exceeding our initial expectations.

儘管受到平均入住率年減超過 100 個基點以及公允價值租賃調整的影響，我們的同店增長按現金計算為 7.2%，按淨有效計算為 5.5%，均表現強勁收購杜克大學帶來的淨有效增長。本季度，我們為新開發項目和收購部署了超過 7 億美元，並完成了超過 10 億美元的處置和貢獻，其價值超出了我們最初的預期。

We continue to grow our solar energy business with the installed capacity of our operating portfolio now at 524 megawatts with an additional 134 megawatts currently under construction. The total of which will generate approximately $55 million of NOI stabilized in line with our forecast.

我們繼續發展我們的太陽能業務，目前我們營運組合的裝置容量為 524 兆瓦，另外 134 兆瓦目前正在建設中。總計將產生約 5500 萬美元的 NOI，穩定符合我們的預測。

Finally, we raised $1.2 billion of debt across our balance sheet and funds at a weighted average rate of 4.4% and a term of 11 years. Outside of this total, we also launched our $1 billion commercial paper program, which has thus far saved an average of 60 basis points on our short-term borrowing costs in the US.

最後，我們透過資產負債表和基金籌集了 12 億美元的債務，加權平均利率為 4.4%，期限為 11 年。除此之外，我們還啟動了 10 億美元的商業票據計劃，迄今為止，該計劃使我們在美國的短期借貸成本平均節省了 60 個基點。

In terms of our markets, there are several encouraging signs for demand, including port volumes on both the East and West Coast, as well as increased volume of proposal activity we've seen across our portfolio. While overall leasing has increased since the first quarter, the tone of our conversations with customers was continued caution in the near term. Even though space utilization sits at near and normal range of approximately 85%, we find that many customers simply lack urgency still prioritizing cost containment in light of an uncertain economic and political environment, both of which will be clearer soon.

就我們的市場而言，需求出現了一些令人鼓舞的跡象，包括東海岸和西海岸的港口吞吐量，以及我們在整個投資組合中看到的提案活動數量的增加。儘管自第一季以來整體租賃量有所增加，但我們與客戶的對話基調在短期內仍然保持謹慎。儘管空間利用率接近正常範圍（約85%），但我們發現，鑑於經濟和政治環境的不確定性，許多客戶只是缺乏緊迫感，仍然優先考慮成本控制，而這兩者很快就會變得更加清晰。

In the meantime, development starts remain muted and below pre-COVID levels. Quarterly completions peaked last year at 140 million square feet and are projected to approach 50 million square feet by the fourth quarter of this year. We estimate vacancies in our US and European markets will peak over the next few quarters, likely creating a shift in tone as customers assess the requirements heading into 2025. Until then, rent growth will be anemic in most markets and down modestly in some.

同時，開發開工仍低迷，且低於新冠疫情前的水平。去年季度竣工面積達到高峰 1.4 億平方英尺，預計到今年第四季將接近 5,000 萬平方英尺。我們估計，美國和歐洲市場的空置率將在未來幾季達到頂峰，隨著客戶評估2025 年的需求，可能會導致基調發生轉變。些市場的租金成長將小幅下降。

Southern California remains its own story where demand remains sluggish, and vacancy continues to drift higher. While we've observed some green shoots over the last 90 days, we expect soft conditions to persist over the next 12 months. Globally, we estimate that effective market rents declined 2% during the quarter with 75% of the decline attributed to [Sunoco].

南加州的情況依然如此，需求依然低迷，空置率持續上升。雖然我們在過去 90 天內觀察到了一些復甦跡象，但我們預計未來 12 個月將持續疲軟的狀況。在全球範圍內，我們估計本季有效市場租金下降了 2%，其中 75% 的下降歸因於 [Sunoco]。

Because there's so much conflicting data available to investors, it's worth mentioning that we measure market rent growth by evaluating effective rents achieved, not asking rents before concessions, a difference that can be as wide as 5% to 10%. We've summarized by highlighting that most of the puts and takes across our global portfolio have provided conditions that are largely stable, with reason for intermediate term optimism due to several quarters of low starts and subdued to positive demand.

由於投資者可以獲得的數據太多相互矛盾，因此值得一提的是，我們透過評估所實現的有效租金來衡量市場租金增長，而不是在讓步前詢問租金，這種差異可能高達5% 至10 %。我們總結時強調，我們全球投資組合中的大多數看跌期權和看跌期權都提供了基本穩定的條件，由於幾個季度的低開工率和積極需求的抑制，中期樂觀情緒是有理由的。

Turning to capital markets, value some modest increases in the second quarter for our US and European funds. There's greater depth amongst buyers of logistics properties and lenders are more active, together reducing yield requirements. In particular, buyer pools for well-located core product are growing now with multiple bidders back in the mix.

轉向資本市場，我們的美國和歐洲基金預計第二季將出現小幅成長。物流房地產買家的深度更加深入，貸款機構也更加活躍，共同降低了收益率要求。特別是，位置優越的核心產品的買家群體現在正在增長，多個投標者重新加入其中。

We saw this very clearly in a large portfolio sale we close this quarter, which was originally brought to the market last fall. Interest was reasonable at the time, but we felt pricing was off elected to wait and achieved 28% higher value in the end.

我們在本季完成的一項大型投資組合銷售中清楚地看到了這一點，該銷售最初於去年秋天推向市場。當時的興趣是合理的，但我們認為價格偏低，選擇等待，最終實現了 28% 的高價值。

I'd like to provide a brief update on our data center business where we are having very good momentum across our pipeline. As you know, access to power is the key to unlocking value. And our dedicated energy and sustainability teams are leveraging our expertise in net zero carbon solutions, solar generation, and battery storage to ensure we are in the pole position with all of the major utilities.

我想簡要介紹一下我們的資料中心業務的最新情況，我們的整個管道發展勢頭非常好。如您所知，獲得權力是釋放價值的關鍵。我們專門的能源和永續發展團隊正在利用我們在淨零碳解決方案、太陽能發電和電池儲存方面的專業知識，以確保我們在所有主要公用事業公司中處於領先地位。

To date, we have secured 1.3 gigawatts of power. Of this, 450 megawatts is currently under construction and $1.2 billion of TEI. 300 megawatts is in active predevelopment with an expected $700 million of TEI, leaving 550 megawatts is available and currently undergoing build to suit discussions. Beyond all of these, we are also in advanced stages of procurement for an additional 1.5 gigawatts, which is key to delivering on our five-year outlook for $7 billion to $8 billion of total data center investment. Overall, we've made significant progress growing this business and are optimistic about the targets we laid out at our Investor Day.

迄今為止，我們已獲得 1.3 吉瓦的電力。其中，450 兆瓦目前正在建設中，TEI 價值 12 億美元。 300 兆瓦正在積極進行預開發，預計 TEI 為 7 億美元，剩下 550 兆瓦可用，目前正在進行建設以適應討論。除此之外，我們還處於額外 1.5 吉瓦採購的後期階段，這對於實現我們資料中心總投資 70 億至 80 億美元的五年前景至關重要。總體而言，我們在發展這項業務方面取得了重大進展，並對我們在投資者日制定的目標感到樂觀。

Turning to guidance, we are making few changes as the years playing out to our expectations. As such, we're maintaining our forecast for average occupancy, same store, G&A, development starts, and stabilizations. There only a few small changes otherwise. We are lowering our guidance for strategic capital revenue by $10 million, only to account for the impact of FX rates, which are hedged elsewhere in our P&L and will not affect overall earnings.

談到指導，隨著這些年的發展符合我們的預期，我們幾乎沒有做出任何改變。因此，我們維持對平均入住率、同店、一般行政費用、開發開工率和穩定性的預測。除此之外只有一些小的變化。我們將策略資本收入指引降低了 1000 萬美元，只是為了考慮匯率的影響，匯率在我們損益表的其他地方進行對沖，不會影響整體收益。

Due to increased activity we're seeing in the capital markets and deals completed year to date, we are increasing our acquisitions guidance to a new range of $1 billion to $1.5 billion, and similarly, increasing our guidance for overall dispositions and contributions to a range of $2.75 billion to $3.65 billion.

由於我們在資本市場上看到的活動增加以及今年迄今為止完成的交易，我們將收購指導提高到 10 億美元至 15 億美元的新範圍，同樣，將整體處置和貢獻的指導提高到一定範圍27.5億美元至36.5億美元。

Ultimately, we increase our gap earnings to a range of $3.25 to $3.45 per share. Core FFO, excluding net promote expense, will range between $5.46 and $5.54 per share, while core FFO including promotes, will range from $5.39 to $5.47 per share, a slight increase at the midpoint from our prior guidance attributed to the fever promote.

最終，我們將每股盈餘差距提高到 3.25 美元至 3.45 美元。核心FFO（不包括淨促銷費用）將在每股5.46 美元至5.54 美元之間，而包括促銷費用在內的核心FFO 將在每股5.39 美元至5.47 美元之間，較我們之前歸因於熱銷促銷的指引略有增加。

Our core earnings guidance calls for nearly 8% growth at the midpoint, which ranks in the 87 percentile of S&P 500 rigs. We've been unique in our ability to generate leading growth over a long period of time, not only through a superior business model and portfolio, but also from our commitment to leveraging all that comes from our scale, including adjacent verticals strategic to our core business. Our focus is simply to continue to deliver on this industry-leading and durable growth.

我們的核心獲利指引要求中點成長近 8%，在標準普爾 500 指數中排名第 87 位。我們在長期實現領先成長的能力方面是獨一無二的，這不僅是透過卓越的業務模式和產品組合，而且還來自我們致力於利用我們規模帶來的一切，包括對我們核心具有戰略意義的相鄰垂直領域商業。我們的重點只是繼續實現業界領先的持久成長。

As we close, I'd also like to highlight an upcoming event, our annual GROUNDBREAKERS thought leadership forum on October 2 in London. The program is taking shape is our best yet, exploring the surprising intersection of logistics and health, energy, and even fashion. Additional information for the forum is available on our website, and we hope to see you there or online.

在我們結束之際，我還想強調一下即將舉行的活動，即 10 月 2 日在倫敦舉行的年度 GROUNDBREAKERS 思想領導論壇。該項目正在成型，是我們迄今為止最好的項目，探索物流與健康、能源甚至時尚之間令人驚訝的交叉點。有關該論壇的更多資訊可在我們的網站上找到，我們希望在那裡或在線見到您。

With that, I'll hand the call back to the operator for your questions.

這樣，我會將電話轉給接線員詢問您的問題。

(Operator Instructions) Blaine Heck, Wells Fargo.

（操作員說明）Blaine Heck，富國銀行。

Thanks, good morning out there. It looks like your occupancy and rent spreads improved as the quarter progressed. Just looking at results versus the [Navy] update. Can you just talk about whether that momentum has continued into the third quarter, if there are any specific market that might have driven that improvement? And related to that occupancy guidance, the maintained guidance implies some downside during the second half of the year, can you just talk about what's driving that trajectory, please?

謝謝，早安。隨著本季的進展，您的入住率和租金利差似乎有所改善。只是看看結果與[海軍]更新的比較。您能否談談這種勢頭是否持續到第三季度，是否有任何特定市場可能推動了這種改善？與入住率指導相關的是，維持的指導意味著下半年會出現一些下行趨勢，您能談談是什麼推動了這一軌跡嗎？

Hey, Blaine. It's Tim. I'll start with the first part, and I may ask you to repeat the second. I'm not sure if I understood the question.

嘿，布萊恩。是蒂姆。我將從第一部分開始，然後我可能會要求您重複第二部分。我不確定我是否理解了這個問題。

But coming into the first few weeks of the third quarter, I think we are maintaining the momentum that I guess you're inferring was picked between [may read] and the end of the quarter, which is there that proposal activity is strong, leasing activity is strong, we see it more in renewables and a little less so in new leasing. We're achieving our rents outside of the drag that we discussed. And SoCal just continues to be in the market that we watch most. But I think when I see put that all together, what we think is we're pleased to see the way the second quarter executed, I think it executed pretty much precisely as we expected from our discussion 90 days ago and feel good about the year.

但進入第三季度的前幾週，我認為我們正在保持勢頭，我猜你推斷是在[可能讀到]和季度末之間選擇的，在那裡提案活動很強勁，租賃活動強勁，我們在可在再生能源中看到更多，而在新租賃中則較少。我們正在實現我們討論的阻力之外的租金。南加州仍然是我們最關注的市場。但我認為，當我看到將所有這些放在一起時，我們認為我們很高興看到第二季度的執行方式，我認為它的執行與我們90 天前討論中的預期非常精確，並且對這一年感覺良好。

Thank you, Blaine. Operator, next question.

謝謝你，布萊恩。接線員，下一個問題。

Craig Mailman, Citi.

克雷格‧梅爾曼，花旗銀行。

Thanks. It's Nick Joseph here on for Craig. Maybe just on the demand side, obviously, it sounds like you're seeing and feeling an improvement there. But I was hoping you could talk about some of the demand differences across different size rate case in geographies.

謝謝。尼克·約瑟夫代表克雷格發言。也許只是在需求方面，顯然，聽起來您正在看到並感受到那裡的改進。但我希望您能談談不同地區不同規模費率情況下的需求差異。

All right. Thanks for the question. It's Chris. I'll start with the geographies.

好的。謝謝你的提問。是克里斯。我將從地理開始。

The healthiest part in the US is the southeastern US, but it also really pointing out Latin America as well as Europe as being areas that are boost overall global picture. As it relates to size categories, the story remains the same relative to what we discussed on our last earnings call, which is to say sizes above 100, maybe even certainly over 250 and 500, that's where demand momentum is the best. But there's also more availability there. It's stable below 100, but that's where vacancies are especially as well.

美國最健康的地區是美國東南部，但這也確實顯示拉丁美洲和歐洲是改善全球整體狀況的地區。由於涉及尺寸類別，情況與我們在上次財報電話會議上討論的情況保持不變，也就是說尺寸超過 100，甚至可能超過 250 和 500，這就是需求動力最好的地方。但那裡也有更多的可用性。它穩定在 100 以下，但這也是職缺特別多的地方。

Thank you. Operator, next question.

謝謝。接線員，下一個問題。

Ron Kamdem, Morgan Stanley.

羅恩‧卡姆德姆，摩根士丹利。

Great. Just a quick question on the rent growth conversation. I think you talked about down to in 2Q after being down 1% in 1Q '24. Maybe if you could just provide some commentary on what the expectations are for the back half of the year. And the 46% rent growth targets long-term, how you guys think about that going forward? Thanks.

偉大的。關於租金成長對話的一個簡單問題。我想你在 2024 年第一季下跌 1% 後談到了第二季的下跌。也許您可以就今年下半年的預期提供一些評論。 46% 的租金成長目標是長期的，你們如何看待未來的發展？謝謝。

Hey, Ron, thanks for the question. It's Tim. Yes, and let me start, I'll just reemphasize. We're talking about effective rents here from all the stores that we see out there and quotation. So this is ultimately taking rents, incorporating all concessions.

嘿，羅恩，謝謝你的提問。是蒂姆。是的，讓我開始，我會再次強調。我們在這裡談論的是我們看到的所有商店的有效租金和報價。因此，這最終是收取租金，並納入所有優惠。

Starting with the next 12 months, I'll do it that way, as we've described we would, we talked about at [may read], we basically would divide our portfolio into SoCal as its own special case and then everything else. And within everything else, there are strong, stable and weak markets. And I would put all of those other non-SoCal markets around flat, maybe modestly negative on market rent growth over the next 12 months, which is a long way of saying it's really going to be a function of what do we think SoCal does in the next 12 months.

從接下來的12 個月開始，我將這樣做，正如我們所描述的那樣，我們在[可能讀到] 中討論過，我們基本上會將我們的投資組合劃分為SoCal 作為其自身的特殊情況，然後再劃分為其他所有部分。在其他一切事物中，都有強勁、穩定和疲軟的市場。我認為所有其他非南加州市場在未來 12 個月內的市場租金增長將持平，甚至可能適度負增長，這從長遠來看，這實際上將取決於我們認為南加州的做法未來12個月。

When we put that altogether, inclusive of SoCal, we would probably put that in a range of something like 2% to possibly 5% down in the next 12 months before inflecting. And this is a good place to just remind everybody that even in light of that -- I mean, we've had three quarters now of some negative market rent growth, one down in the fourth quarter of last year, one down first quarter, two down this last second quarter.

當我們把所有這些因素（包括南加州在內）放在一起時，我們可能會將其放在未來 12 個月內下降 2% 到 5% 的範圍內，然後再進行調整。這是一個提醒大家的好地方，即使考慮到這一點 - 我的意思是，我們現在已經有三個季度出現市場租金負增長，去年第四季度一個下降，第一季一個下降，最後第二季度下降了兩點。

In the meantime, we're putting up very significant rent change and growth within our NOI. 74%, one of our highest quarters just this last quarter. So it's very fortuitous, the position we're in. We have this large lease mark-to-markets to carry us through this transition period.

同時，我們在 NOI 內進行了非常顯著的租金變化和成長。 74%，是上個季度最高的季度之一。因此，我們所處的位置是非常偶然的。

Thank you, Ron. Operator, next question.

謝謝你，羅恩。接線員，下一個問題。

Steve Sakwa, Evercore ISI.

Steve Sakwa，Evercore ISI。

Yes, thanks. I think you commented on the lease proposals, but I was just wondering if you could provide a little bit more detail. Obviously, that green line is up strongly to the right. And I'm just curious how much of that is for new activity or vacant space or development? And how much of that might be for renewal activity just to frame it out because that number is up quite a bit even from the past couple of years.

對了謝謝。我認為您對租賃提案發表了評論，但我只是想知道您是否可以提供更多細節。顯然，那條綠線明顯向右上方上升。我只是好奇其中有多少是用於新活動或空置空間或開發？其中有多少可能用於更新活動，因為這個數字甚至比過去幾年還增加了很多。

It is, and thanks, Steve. The chart you're looking at in the supplemental is new leasing, just to be clear. And you highlight something that I'm glad you did.

是的，謝謝史蒂夫。需要明確的是，您在補充中看到的圖表是新租賃。你強調了一些我很高興你所做的事情。

We do see the very big uptick in nominal proposals, 112 million square feet meaningfully above where we've been. That's a function of a few things there. One, it's just more space to lease. We have some increased vacancy in the portfolio, and this is also a function of just how the next 12 months will look and others a little bit more there as well.

我們確實看到名義提案數量大幅增加，比我們之前的水準顯著增加了 1.12 億平方英尺。這是那裡一些事情的函數。第一，這只是更多的租賃空間。我們的投資組合中的空缺有所增加，這也是未來 12 個月的情況以及其他一些情況的函數。

This is why we added, for those who have noticed, a new line just this quarter, which puts that proposal activity in the context of what is available to lease. You see that measure, that 42% this last quarter, which we would characterize, and you can see when you look at the chart as normal.

這就是為什麼我們在本季度添加了一條新線，將提案活動置於可租賃的背景下。你可以看到這個指標，即上個季度的 42%，我們將對其進行描述，當你正常查看圖表時你可以看到。

Thank you, Steve. Operator, next question.

謝謝你，史蒂夫。接線員，下一個問題。

Camille Bonnel, Bank of America.

卡米爾·博內爾，美國銀行。

Good morning. The pace of development stabilizations seems to be tracking ahead this halfway point of the year. So I was wondering how does this compare to what was budgeted in your guidance. And on the West Coast, it looks like you've made some good progress stabilizing some of these development. So can you talk to some general terms on rents versus underwriting, and how much of that with new leases signed in the quarter? Thank you.

早安.今年過半時，發展穩定的步伐似乎正在向前推進。所以我想知道這與您指導中的預算相比如何。在西海岸，看起來您已經取得了一些良好的進展，穩定了其中一些發展。那麼，您能否談談有關租金與承保的一些一般條款，以及本季簽署的新租約中有多少？謝謝。

Yes, thanks for the question, Camille. This is Dan. I'll handle the question here.

是的，謝謝你的提問，卡米爾。這是丹.我會在這裡處理這個問題。

So it was a big stabilization quarter for us. Certainly, development leasing has slowed a bit. I think the best way to look at our development portfolio is look at the whole book of business. Don't look at it necessarily on a quarter-by-quarter basis.

因此，這對我們來說是一個重要的穩定季度。當然，開發租賃已經放緩了一些。我認為查看我們的開發組合的最佳方法是查看整個業務手冊。不一定要按季度來看。

So if you look at the whole $6 billion development portfolio, all 35 million feet, we're trending to our long-term margin of 24% to 25%. So if you look at our 20-year average into the high 20s, so we feel really good about our development portfolio.

因此，如果你看看整個 60 億美元的開發投資組合（全部 3,500 萬英尺），我們的長期利潤率趨向於 24% 至 25%。因此，如果你看看我們 20 年的平均值達到了 20 多歲，那麼我們對我們的開發組合感覺非常好。

Thank you, Camille. Operator, next question.

謝謝你，卡米爾。接線員，下一個問題。

Jon Petersen, Jefferies.

喬恩彼得森，傑弗里斯。

Great. Thank you. So I was looking at your top tenant list. It looks like an increase in square feet leased to Amazon and Home Depot. We're hearing from other people that Amazon is more active this year. What do you want to talk about them specifically or maybe we can frame it in the context of -- what impacted some of the larger players in the market being more active in leasing have on the overall market? Like our people waiting for them to make decisions before we start to see an uptick in activity. Is that what's happening right now?

偉大的。謝謝。所以我正在查看你們的頂級租戶名單。看起來亞馬遜和家得寶的租賃面積增加。我們從其他人那裡聽說亞馬遜今年更加活躍。您想具體談談它們的什麼，或者也許我們可以在這樣的背景下進行討論——是什麼影響了市場上一些較大的參與者在整個市場上更積極地參與租賃？就像我們的員工在等待他們做出決定一樣，然後我們才開始看到活動的增加。這就是現在正在發生的事情嗎？

Yes, Jon. Hi, this is Dan. Thanks for the question. So what you're pointing to is our top 25 list where you saw some big completions come into the operating portfolio. Those are decisions that were made of a year ago. And sure, we've had some success with Amazon this year.

是的，喬恩。嗨，這是丹。謝謝你的提問。所以你指的是我們的前 25 名名單，你看到一些大型竣工項目進入了營運組合。這些都是一年前做出的決定。當然，今年我們在亞馬遜方面取得了一些成功。

I would actually talk about the e-commerce segment overall. E-commerce has been very strong. We talked about this happening multiple quarters ago before it was a story, and it's played out as exactly as we expected. E-commerce continues to be strong. Amazon was a little quiet out for us this last quarter. But at any given time, they're our top customer. We've got a lot going on with them and it's a very strong segment for us.

我實際上會整體談論電子商務領域。電子商務一直非常強勁。我們在幾個季度前就討論過這件事發生在它成為一個故事之前，它的發展正如我們預期的那樣。電子商務持續強勁。上個季度，亞馬遜對我們來說有點安靜。但在任何特定時間，他們都是我們的首要客戶。我們與他們進行了很多合作，這對我們來說是一個非常強大的部分。

Thank you, Jon. Operator, next question.

謝謝你，喬恩。接線員，下一個問題。

Caitlin Burrows, Goldman Sachs.

凱特琳·布羅斯，高盛。

Hey, everyone. Maybe just on the transaction market. I think, Tim, earlier you mentioned how the depth of buyers is deeper and the disposition you did within a materially higher valuation now versus 2023. So I guess what are you guys seeing from an acquisition potential on your side who is selling and your opportunity there in the near term?

嘿大家。也許只是在交易市場。我想，提姆，早些時候你提到了買家的深度是如何更深的，以及你在現在的估值比2023 年高得多的情況下所做的配置。一方的收購潛力和您的機會中看到了什麼短期內有嗎？

Hi, Caitlin. Thanks for the question. Yes, we have seen the transaction market open up -- I would say, normalize. We're hearing from the brokerage community that they're doing a lot of broker opinion values. So we expect to see the transaction market to continue.

嗨，凱特琳。謝謝你的提問。是的，我們已經看到交易市場開放了——我想說，交易市場正在正常化。我們從經紀界得知，他們正在做很多經紀商的意見值。因此我們預計交易市場將持續下去。

We've had a lot of success in the disposition. We've outperformed across the board and our disposition business, which is why you saw us move our guidance up. We definitely take advantage of the market as it's opened up. And we have also been turning over all sorts of interesting opportunities in many markets around the globe, and we're really excited about our acquisition volume for the year.

我們在這方面取得了巨大的成功。我們的整體表現和處置業務都跑贏大市，這就是我們上調指導的原因。我們肯定會利用市場開放的機會。我們也在全球許多市場上提供了各種有趣的機會，我們對今年的收購量感到非常興奮。

Yes, the other thing I would add to that, Caitlin, is that you have closed-end funds that are coming to the end of their lives. And those portfolios needed to be liquidated. And the investment is generally because of what's going on in their portfolio, not just in real estate, but also in other private asset classes need the liquidity because they have outstanding commitments. So there's pressure from those guys to realize these sales. And industrial real estate has been one of the places that their performance has been really great, and the crystallization of those values is important.

是的，凱特琳，我要補充的另一件事是，你們的封閉式基金即將走到生命的盡頭。這些投資組合需要清算。投資通常是因為他們的投資組合中發生的事情，不僅是房地產，而且是其他需要流動性的私人資產類別，因為他們有未履行的承諾。因此，這些人面臨著實現這些銷售的壓力。工業地產是其業績真正出色的領域之一，這些價值的結晶非常重要。

So a financial course of things, and yes, some deferred sales volume that was put on suspended animation for the last 24 months that's not coming to. But generally, I would say that transaction market is very tight right now with multiple offers for good portfolios. And the sweet spot is a couple of hundred million, I would say. Not mega deals and timing deals, but in the $100 million, $200 million.

因此，從財務角度來看，是的，過去 24 個月中一些一直處於假死狀態的延期銷售量並沒有實現。但總的來說，我想說，目前交易市場非常緊張，良好的投資組合有多種報價。我想說，最好的數字是幾億。不是大型交易和時機交易，而是1億美元、2億美元的交易。

Thank you, Caitlin. Operator, next question.

謝謝你，凱特琳。接線員，下一個問題。

Nick Thillman, Baird.

尼克·希爾曼，貝爾德。

Hey, good morning out there. And Tim, you mentioned the uptick in new lease proposals. Maybe I just wanted to dig in on retention for the next 12 months. Are you expecting that to the historical averages and then also continue to see free rent uptake? As the elevated concessions, is that spur demand a little bit? Just want a little more color on that. Thanks.

嘿，早安。提姆，您提到了新租賃提案的增加。也許我只是想深入研究未來 12 個月的保留率。您是否期望達到歷史平均水平，然後繼續看到免費租金吸收？隨著優惠力道的提高，是不是有點刺激了需求呢？只是想要多一點顏色。謝謝。

So Nick, thanks. On the retention front, we typically forecast between 70% and 80%, they think of it as 75%. And that's a good number. And I would characterize that as our expectations over the coming several quarters.

尼克，謝謝。在保留率方面，我們通常預測在 70% 到 80% 之間，他們認為是 75%。這是一個很好的數字。我將其描述為我們對未來幾季的預期。

And then free rent, I think we may have discussed just recently. I would view free rent just reverting to mean levels. We had -- there's another area where we had some surge pricing, if you will, some much lower free rent over the last few years. And now the market as it normalizes at different pace in different places, it's coming back to a more normalized level as well.

然後免租，我想我們可能最近才討論過。我認為免費租金只是恢復到平均水平。如果你願意的話，在另一個領域，我們在過去幾年中實行了一些低得多的免費租金。現在，隨著不同地方的市場以不同的速度正常化，它也回到了更正常化的水平。

Thank you, Nick. Operator, next question.

謝謝你，尼克。接線員，下一個問題。

Vikram Malhotra, Mizuho.

維克拉姆·馬爾霍特拉，瑞穗。

Good morning. Thanks so much for taking the question. So I guess just two parts, one, Chris, could you just update us on your view on the $175 million of net absorption, what you anticipate for the second half? And then I guess you also mentioned for the roll-in rent growth projection. Could you expand upon that in context of your three-year view that you provided at the Investor Day on occupancy and same-store NOI growth? Thanks.

早安.非常感謝您提出問題。所以我想只有兩部分，一是克里斯，您能否向我們介紹一下您對 1.75 億美元淨吸收量的最新看法，以及您對下半年的預期？然後我想您也提到了轉入租金成長預測。您能否結合您在投資者日提供的關於入住率和同店 NOI 成長的三年觀點來詳細闡述這一點？謝謝。

Hi, Vikram. Thanks for the question. It's Chris. So as it relates to demand, just for those following along in absorption, first quarter was 26, 27 million square feet. We have had a 43 in the second. And so we expect 40 to 50 million square feet in absorption. I think that's the tone that Tim had in his script and that we have here on the call for you. That will leave you as for the full year net absorption of 160 to 170 million square feet. Tim's going to take.

嗨，維克拉姆。謝謝你的提問。是克里斯。因此，就需求而言，僅對於那些跟隨吸收的人來說，第一季的面積為 26, 2700 萬平方英尺。第二局我們打出了 43 分。因此，我們預計吸納量為 4,000 至 5,000 萬平方英尺。我認為這就是蒂姆在劇本中的基調，也是我們在這裡為您呼籲的基調。這將使全年淨吸收量達到 1.6 至 1.7 億平方英尺。蒂姆會接受。

Yes, Vikram. In terms of the three years, the way we think about that, we clearly have an environment now where the window of time that we think about, the three years, has shifted. We've highlighted that we think rents are going to continue to fall modestly in the coming 12 months, grow thereafter. But the time that is then left to measure up to the end of 2026 is, of course, been shortened.

是的，維克拉姆。就這三年而言，我們思考的方式，我們顯然現在所處的環境，我們思考的時間窗口，也就是三年，已經改變了。我們強調，我們認為未來 12 個月租金將繼續小幅下降，此後將會成長。但到 2026 年底的時間當然會縮短。

If we look at that same period, the end of '23 to the end of 2026, our sense is that rents are going to be flat then to modestly positive over that entire period. But we would couch that as rent that's really been deferred that the windows moving and that ultimately loss.

如果我們看看同一時期，即 23 年底到 2026 年底，我們的感覺是，在整個時期內，租金將持平，然後略有上升。但我們會將其表述為租金，該租金實際上已被推遲，因為窗戶移動並最終造成了損失。

Yes, one of the perspectives I might provide to you is that the big change since our 4% to 6% per year forecast has actually been in concessions. So those concessions have -- I mean, in other words, if you have to forecast one for asking rents and one for effective rents, the effective rent one has been affected more since our Investor Day when we laid out that assumption. Not all of it, but face rents have come down in Southern California, certainly. But most of it has been expansion in the concessions. And we see those burning off over the next 12 months as market come into -- even the weaker market markets come into balance.

是的，我可能向您提供的觀點之一是，自我們每年 4% 至 6% 的預測以來的巨大變化實際上是在讓步。因此，這些讓步——我的意思是，換句話說，如果你必須預測一項要價租金和一項有效租金，那麼自從我們投資者日提出這一假設以來，有效租金受到的影響更大。雖然不是全部，但南加州的面租確實有所下降。但其中大部分是特許權的擴大。我們預計，隨著市場的進入，這些資金將在未來 12 個月內消失——即使是較疲軟的市場也將達到平衡。

Just to give you a sense of something that Chris mentioned before, Southern California accounts for about 23% of our rents over the next 12 months. What we categorize as leakage market are another 21% of our rental profile for the next 12 months. And fully 56% of the rents rolling over in the next 12 months are in stable or healthy markets.

只是為了讓您了解 Chris 之前提到的情況，未來 12 個月內，南加州約占我們租金的 23%。我們將未來 12 個月的租賃情況中另外 21% 的部分歸為滲漏市場。未來 12 個月內滾動租金的 56% 全部來自穩定或健康的市場。

So on this isn't really a Southern California problem where it's both an expansion in concessions and reduction in base rent. Fortunately, and this is really important, Southern California is the market with the largest mark to market in the next 12 months, even with the decline that we are projecting. So there is pretty good downside protection, in fact, upside protection if there's such a word on those expiring rents in Southern California. So ironically, the weakest markets have the most mark to market, certainly, in the near term.

因此，這並不是南加州真正的問題，它既是擴大優惠又減少基本租金。幸運的是，這一點非常重要，儘管我們預計會下降，但南加州是未來 12 個月內市場變化最大的市場。因此，如果南加州那些即將到期的租金有這樣的說法，那麼就有相當好的下行保護，事實上，還有上行保護。諷刺的是，在短期內，最疲軟的市場當然具有最大的市場價值。

Thank you, Vikram. Operator, next question.

謝謝你，維克拉姆。接線員，下一個問題。

John Kim, BMO Capital Markets.

約翰金 (John Kim)，BMO 資本市場。

Thank you. I wanted to ask about the occupancy trajectory for the remainder of this year. At nearly, there was some discussion of this would dip below 96% in the near term and then recover. Is that Stellent on the table or are you now passed that risk, given the end of the quarter at 96.4%?

謝謝。我想詢問今年剩餘時間的入住率軌跡。幾乎有一些討論認為，這一比例將在短期內降至 96% 以下，然後恢復。鑑於本季末的 96.4%，Stellent 是否已擺在桌面上？

Thanks, John. And I realize this was also Blaine's question that I missed earlier. So thanks for coming back to it. The 96 comment was very specific about where we thought the second quarter was going to land. I would say that the year-to-date average that we have so far around 96.6 year to date, the midpoint of our guidance is 96 in the quarter. That just reflects some tougher role so a little bit longer lease-up time that we see in new leasing. I hope it's conservative. I suppose there's a possibility, but we feel good about the range that we've established.

謝謝，約翰。我意識到這也是我之前錯過的布萊恩的問題。謝謝你回來討論這個問題。 96 則評論非常具體地說明了我們對第二季的預期。我想說的是，今年迄今為止的平均值約為 96.6，我們本季指導的中點是 96。這只是反映了我們在新租賃中看到的一些更嚴格的角色，因此租賃時間更長一些。我希望它是保守的。我認為有可能，但我們對已經建立的範圍感覺良好。

One other way of it, I think this was in Tim's prepared remarks. I think the quality of the portfolio manifests itself in two ways. It manifests itself in terms of premium in occupancy, which, if anything, has expanded in this market environment because when markets are really tight, people don't have a choice, they can't be picky about asset quality space, pretty much everything leases.

另一種方式，我認為這是蒂姆準備好的演講中的內容。我認為投資組合的品質體現在兩個方面。它體現在入住率溢價方面，如果有什麼不同的話，那就是在這種市場環境下，入住率溢價有所擴大，因為當市場非常緊張時，人們別無選擇，他們不能對資產品質空間挑剔，幾乎所有事情租賃。

But as market get more normalized softer in some cases, business goes towards the higher quality business aside. It's hard to predict the absolute level of occupancy certainly quarter-by-quarter because one or two leases, even as large as our portfolio as can really move around the numbers. But I can tell you our premium, I'm very confident of our premium in occupancy compared to the rest of the market. I think it's going to expand even further.

但隨著市場在某些情況下變得更加正常化和疲軟，業務將轉向更高品質的業務。很難逐季度預測入住率的絕對水平，因為一兩個租賃，即使與我們的投資組合一樣大，也可以真正改變數字。但我可以告訴你我們的溢價，與市場其他公司相比，我對我們的入住率溢價非常有信心。我認為它還會進一步擴大。

Thank you, John. Operator, next question.

謝謝你，約翰。接線員，下一個問題。

Vince Tibone, Green Street.

文斯·蒂伯恩，格林街。

Hi, good morning. Capital allocation guidance, it implies an acceleration of starts in the back half of the year. Are these all mostly plan logistics starts? Are there some data centers in there as well? And related all this, what markets would you be comfortable starting a spec projects today in the current environment?

早安.資本配置指引，意味著下半年開工加速。這些都是主要計畫物流啟動嗎？那裡也有一些資料中心嗎？與所有這些相關的是，在當前環境下，您今天願意在哪些市場啟動規範項目？

Hi, it's Dan. Thanks for the question. So I think, well, first of all, your question around what's in our start volume. That is entirely logistics that you see there. And the better way to think about where we're going to build is look at the sheer amount of opportunities we have. We have $40 billion worth of opportunities in dozens of markets around the world. We've raised the bar on spec.

嗨，我是丹。謝謝你的提問。所以我認為，首先，你的問題是關於我們的起始卷中的內容。這完全是你在那裡看到的物流。考慮我們要在哪裡建立的更好方法是看看我們擁有的大量機會。我們在全球數十個市場擁有價值 400 億美元的機會。我們提高了規格標準。

We take it through a rigorous process, pay attention to the market fundamentals, and I look at every deal on a deal-by-deal basis. So we have many markets around the world that will be building in this year. And I think decisions that we make on a deal-by-deal basis may change between now and when we start. So it's hard to peg anything certainly right now.

我們透過嚴格的流程，專注於市場基本面，我會逐筆交易地檢視每筆交易。今年我們將在全球建立許多市場。我認為，從現在到開始時，我們在逐筆交易的基礎上做出的決定可能會改變。所以現在很難確定任何事情。

But if you're asking for specific names of markets, I would say Mexico is super strong. Nashville is then on the southeast, pretty strong and demand there. Northern Europe is very strong. So those are places you'll most likely to see spec development starts.

但如果你要問具體的市場名稱，我會說墨西哥非常強大。納許維爾位於東南部，那裡的需求相當強勁。北歐很強大。因此，這些是您最有可能看到規範開發開始的地方。

Thank you, Vince. Operator, next question.

謝謝你，文斯。接線員，下一個問題。

Ki Bin Kim, Truist Securities.

Ki Bin Kim，Truist 證券公司。

Thanks. Good morning. I want to talk about your data center business. Given the update you provided, at least from outside looking in, it seems like you're ahead of your five-year plan for 3 gigawatts of deployment. I'm not sure if that's correct, but maybe you could just comment on incremental changes in demand you're seeing in that business?

謝謝。早安.我想談談你們的資料中心業務。鑑於您提供的更新，至少從外部來看，您似乎已經提前完成了 3 吉瓦部署的五年計劃。我不確定這是否正確，但也許您可以評論一下您在該業務中看到的需求增量變化？

We are more optimistic about our data center business since the time of our Investor Day I think where some of those numbers come from event. Part of it is we've done some Exxon recruiting in terms of specialists in the sector that joined the team and are very excited. And secondly, the energy team that we have, the renewable energy team that we have has excellent relationships with utilities. And that's something that oftentimes is missing in a lot of data center companies that are just at the real estate component.

自投資者日以來，我們對我們的資料中心業務更加樂觀，我認為其中一些數字來自事件。部分原因是我們已經在埃克森美孚招募了一些該領域的專家，他們加入了我們的團隊，我們對此感到非常興奮。其次，我們的能源團隊、再生能源團隊與公用事業公司有著良好的關係。這是許多只從事房地產業務的資料中心公司經常缺少的東西。

And obviously, we know the five hyperscale's really well. And in this environment, the ability to finance and deliver and execute becomes super important. These are mission critical deployments for these companies. And it is increasingly difficult for private players that don't have a balance sheet to compete in that market. So we think the competitive position of our largest, both because talent and balance sheet are just starting to get better and better going forward.

顯然，我們非常了解這五個超大規模。在這種環境下，融資、交付和執行的能力變得非常重要。這些是這些公司的關鍵任務部署。對於沒有資產負債表的私人企業來說，在該市場競爭越來越困難。因此，我們認為我們最大的競爭地位，因為人才和資產負債表才剛開始變得越來越好。

Thank you, Steven. Operator, next question.

謝謝你，史蒂文。接線員，下一個問題。

Mike Mueller, JPMorgan.

麥克·穆勒，摩根大通。

Yes, hi. Where do you think we are in terms of 3PLs resetting their footprints?

是的，嗨。您認為我們在 3PL 重置足跡方面處於什麼位置？

Hi, Mike, thanks for the question. So the 3PL market is really an interesting dynamic right now. What we're seeing is certainly slack in the system, more acute in Southern California where they're simply just more 3PLs, almost double the average across the US. And that's where they took up a lot more space during COVID.

嗨，麥克，謝謝你的提問。因此，3PL 市場目前確實是一個有趣的動態。我們所看到的情況肯定是系統鬆弛，在南加州更為嚴重，那裡的 3PL 數量更多，幾乎是美國平均水平的兩倍。在新冠疫情期間，他們在那裡佔據了更多空間。

Now you can't deliver for our customer in a market that you don't have space, and a lot of the excess space that 3PLs have is scattered throughout their networks. By way of example, one of our top 25 customers came to us recently and said we have 6% to 7% excess space in our network. Yet a 750,000 square foot need emerged in a major market, which led to a long-term very large lease for us.

現在，您無法在沒有空間的市場中為我們的客戶送貨，而 3PL 擁有的大量多餘空間分散在其網路中。舉例來說，我們的 25 位前 25 位客戶之一最近來找我們，並表示我們的網路中有 6% 到 7% 的多餘空間。然而，一個主要市場出現了 750,000 平方英尺的需求，這導致我們需要長期租賃。

One way to think about the 3PL market is this. That 3PLs basically serve two purposes. Some 3PL business and volume comes from players that just want to outsource that activity to somebody else because they want to focus on their own business. And what I consider that to be baseload business, it doesn't act any differently than leases that are directly entered into by those companies, those principles.

思考 3PL 市場的一種方式是這樣的。 3PL 基本上有兩個目的。一些 3PL 業務和數量來自於那些只想將活動外包給其他人的參與者，因為他們想專注於自己的業務。我認為這是基本負載業務，它的行為與這些公司直接簽訂的租賃沒有任何不同，這些原則。

Then there is the surge component of 3PLs. That is the component that is likely to be more volatile. On the way down when markets are becoming softer, you expect that component to actually suffer more. And when the markets are on the upswing, that's where you see the excess activities. The base part stays pretty consistent with the rest of the portfolio.

然後是 3PL 的激增部分。這是可能更不穩定的組成部分。當市場變得疲軟時，您預計該組成部分實際上會遭受更大的損失。當市場上漲時，你會看到過度的活動。基礎部分與產品組合的其餘部分保持相當一致。

Southern California, to be specific, has in the low 30% range in terms of 3PL share of business. Now a lot of that is baseline business, but some of it is search business versus the average of the US, which is about 18% of the total portfolio is leased by 3PL. So obviously, those markets with bigger exposure to 3PLs have more of this problem on the search component.

具體而言，南加州的 3PL 業務份額處於 30% 的低水平。現在，其中許多是基準業務，但其中一些是搜尋業務，而美國的平均水平是 3PL 租賃的業務佔總投資組合的 18% 左右。顯然，那些與 3PL 接觸較多的市場在搜尋方面存在更多的問題。

Thank you, Mike. Operator, next question.

謝謝你，麥克。接線員，下一個問題。

Michael Goldsmith, UBS.

麥可‧戈德史密斯，瑞銀集團。

Good afternoon. Thanks for taking my question. You continue to remain confident on the intermediate term outlook, particularly on the demand side. So maybe just to sum everything up there that we've heard already today, what evidence do you see today that gets you excited? And then can you walk us through how you see the timing of that recovery playing out? Thanks.

午安.感謝您提出我的問題。您繼續對中期前景保持信心，特別是在需求方面。那麼也許只是總結一下我們今天已經聽到的所有內容，您今天看到的哪些證據讓您感到興奮？那麼您能否向我們介紹一下您如何看待復甦的時機呢？謝謝。

Look, predicting market cycles, particularly when you've got a couple of wars going on, you've got a set that's had an inflection point with respect to interest rates. And you've got a presidential election coming up, which is, obviously, with the events of this, we can -- are highly volatile.

看，預測市場週期，特別是當你正在進行幾場戰爭時，你會得到一個在利率方面有拐點的集合。總統選舉即將到來，顯然，隨著這起事件的發生，我們可以——非常不穩定。

You got three major things going on. And to the extent that you're asking us for very specific forecast, let me tell you, we're not that good. And you should know that. But what gives us confidence, we can argue whether the full recovery, the market is 6 months or 12 months or 18 months.

你發生了三件主要的事情。如果您要求我們提供非常具體的預測，讓我告訴您，我們並沒有那麼好。你應該知道這一點。但什麼給了我們信心，我們可以爭論市場是否全面復甦，是6個月、12個月還是18個月。

I frankly think this is just my sense, having done this for 40 years, that the Southern California market center, the softness are going to stabilize the latest in about 12 months out. And the other submarkets are matter between now and 12 months, and more than half the markets are actually -- they don't need to recover because they've never unrecovered. They've been going straight up.

坦白說，我認為這只是我的感覺，40 年來，南加州市場中心的疲軟狀況將在 12 個月後穩定下來。從現在到 12 個月，其他子市場都很重要，而且超過一半的市場實際上不需要恢復，因為它們從未恢復過。他們一直在直線上升。

So I think you're talking about the next 12 months as various markets turn that the corner. And if we're going to pick a number, and I think if you get your head into January of next year, the presidential uncertainty will be done. I'm pretty sure that the Fed uncertainty will be done. So we'll be down to the political starts.

所以我認為您談論的是未來 12 個月，因為各個市場都會出現轉機。如果我們要選擇一個數字，我想如果你認真思考明年一月的情況，總統的不確定性就會消失。我非常確定聯準會的不確定性將會消失。所以我們將從政治開始。

And what know for a fact, which is not a prediction, is that start volume is very low, and replacement costs have continued to go up. Construction costs have moderated. But exemptions on land and approvals and entitlements, those continue to go up. So I'm super confident about the long-term strength of our business. And calling get over quarters or even a couple of quarters is really difficult. But if you want an answer, you have it.

眾所周知的事實（並非預測）是，啟動量非常低，且更換成本持續上升。建築成本放緩。但土地、審批和權利的豁免仍在持續增加。因此，我對我們業務的長期實力非常有信心。打電話過去幾個季度甚至幾個季度確實很困難。但如果你想要答案，你就有了。

Thank you, Michael. Operator, next question.

謝謝你，麥可。接線員，下一個問題。

Todd Thomas, KeyBanc Capital Markets.

托馬斯 (Todd Thomas)，KeyBanc 資本市場。

Hi, thanks. Me just following up on that a little bit. I'd be curious to get your thoughts on another maybe uncertain item, the potential impact tariffs might have on trade, and industrial real estate in the US, and just whether conversations you're having today with tenants are prospective tenants might be impacted as a result. And really, does that change anything? Potentially, how you think about allocating capital globally?

你好謝謝。我只是稍微跟進一下。我很想知道您對另一個可能不確定的問題的看法，關稅可能對美國的貿易和工業房地產產生的潛在影響，以及您今天與潛在租戶的對話是否會受到影響一個結果。真的，這會改變什麼嗎？您如何考慮在全球範圍內配置資本？

Yes. That's a really good question on. So first of all, I think there's a race between both parties on tariffs. I'm not sure which outcome is going to lead to more tariffs. Probably that Trump outcome, which is a higher probability at this point, is going to lead to more tariffs specifically on China. But at the end of the day, I think what you need to remember is that we are in supporting the consumption side of the supply chain. We've never focused on production end of the supply chain. So that same amount of goods volume of goods needs to get confused -- consumed in these markets.

是的。這是一個非常好的問題。首先，我認為雙方在關稅方面有競爭。我不確定哪種結果會導致更多關稅。川普的結果（目前可能性較高）可能會導致專門針對中國徵收更多關稅。但歸根究底，我認為你需要記住的是，我們正在支持供應鏈的消費端。我們從來不關注供應鏈的生產端。因此，同樣數量的商品需要在這些市場上被消費。

With respect to specific tariffs like on China, all of that business as part of China plus one strategy of a lot of suppliers has already moved to other markets. Most of them are in Asia, a lot of them are in Southeast Asia. Some of it has shifted over to Mexico, particularly on the Northern Border.

就像對中國這樣的特定關稅而言，作為中國一部分的所有業務加上許多供應商的策略已經轉移到其他市場。其中大部分在亞洲，其中許多在東南亞。其中一些已經轉移到墨西哥，特別是在北部邊境。

But at the end of the day, they're going to get consumed where the people are in the US. So we don't see a radical demand shifts between markets or in terms of overall need for our product. So that's the main driver.

但最終，它們將在美國人民所在的地方被消耗掉。因此，我們沒有看到市場之間或對我們產品的整體需求方面出現根本性的需求變化。這就是主要驅動力。

The second order effect is to the extent there are tariffs -- economics 101, you're going to have higher inflation, and that could cause the Fed to relax slower. And that will have obviously a headwind effect on the overall economy, which in turn will affect the demand for industrial real estate and everything else.

第二階效應是關稅的程度－經濟學101，通貨膨脹將會更高，這可能會導緻聯準會放慢放鬆速度。這顯然會對整體經濟產生不利影響，進而影響對工業房地產和其他一切的需求。

So I'm not worried at all about the primary effect, the direct effect of China, the way people think about this China-LA connection and the fact that that somehow going to be under pressure because that containers are going to land in LA. We don't really care where they come from. But the second order effect, which most people don't think about I think is important -- but that will be a problem in everybody's earnings calls if it were to materialize.

因此，我根本不擔心主要影響，即中國的直接影響，人們對中國與洛杉磯聯繫的看法，以及由於貨櫃將降落在洛杉磯而以某種方式承受壓力的事實。我們並不真正關心它們來自哪裡。但我認為大多數人沒有想到的二階效應很重要，但如果它成為現實，這將成為每個人的財報電話會議中的一個問題。

Thank you, Todd. Operator, next question.

謝謝你，托德。接線員，下一個問題。

Nicholas Yulico, Scotiabank.

尼古拉斯·尤利科，豐業銀行。

Hey, thanks. You've talked earlier about the transaction market pricing improving. Can you relate that to the strategic capital on revenue? Actually, we think about where the funds are valued right now and whether there could be upside potential revenue for that versus on the funds flow side? What you're seeing?

嘿，謝謝。您之前談到了交易市場定價的改善。您能否將其與收入策略資本連結起來？實際上，我們會考慮目前資金的估值，以及與資金流動方面相比是否可能有上升的潛在收入？你看到了什麼？

On our fund valuation, I can confidently tell you that we have turned the corner in both US and Europe. We were early adjusting our values, and I think we're now in the good side of the cycle. I think in a lot of other people's funds, they've been dragging their feet in adjusting the real value part of it. Some of it intentionally and some of it not intentionally because the appraisers are always backward looking. And until there's data and it takes time for data to reflect itself in the comp set, those values haven't adjusted.

關於我們的基金估值，我可以自信地告訴你，我們在美國和歐洲都已經渡過難關。我們很早就調整了我們的價值觀，我認為我們現在處於週期的好的一面。我認為在許多其他人的基金中，他們在調整其實際價值部分方面一直拖延。有些是有意的，有些是無意的，因為評估者總是向後看。在有數據且數據需要時間在比較集中反映自身之前，這些值還沒有調整。

So I think the market will continue to experience a decline in values. That really occurred 6, 9, 12 months ago, but are just not being acknowledged. I think we've already passed that, and our finance will be going up in value because of a more direct link between our valuation process, which is, by the way, independent. And that's really important to also understand. A lot of these funds don't do independent appraisals and others. So you may hear mixed messages on that, and that's just because we've been ahead of the curve.

所以我認為市場將繼續經歷價值下跌。這確實發生在 6、9、12 個月前，但只是沒有被承認。我認為我們已經通過了這一點，而且我們的財務價值將會上升，因為我們的估值流程之間有更直接的聯繫，順便說一句，估值流程是獨立的。理解這一點也非常重要。其中很多基金不進行獨立評估等。因此，您可能會聽到一些混雜的訊息，這只是因為我們一直處於領先地位。

As to the second part of your question, which is fund flows into industrial real estate, there is a tremendous amount of money that has been raised and not spend in acquisitions by investment managers. And my experience tells me that that money is going to get cement. And so I think that it's going to be the source of capital for a lot of transactions going forward.

至於你問題的第二部分，資金流入工業房地產，投資經理已經籌集了大量資金，但沒有用於收購。我的經驗告訴我，這些錢將用來購買水泥。因此，我認為它將成為未來許多交易的資金來源。

In terms of new allocations to industrial real estate and everything else, remember, these portfolios are under a lot of pressure because they've had some office buildings that have declined in value 30%, 40%, 50%, 60%, which has been the biggest component of their portfolios. So they're under pressure and they're looking for more liquidity as opposed to being in a front foot forward investing mode. So I think the volume of new capital allocations to all kinds of real estate will be saw coming back, but it is on the upswing. It's just slower coming back than most other cycles.

就工業房地產和其他一切的新配置而言，請記住，這些投資組合承受著很大的壓力，因為它們的一些辦公大樓價值下降了 30%、40%、50%、60%，這已經是他們投資組合中最大的組成部分。因此，他們面臨壓力，他們正在尋求更多的流動性，而不是處於領先的遠期投資模式。因此，我認為各類房地產的新資本配置量將會回升，而且正在上升。它只是比大多數其他週期恢復得慢。

All right. So I think that was a last question. Thank you again for your interest in the company. and everybody enjoy the rest of the summer. We'll see you pretty soon, hopefully, at GROUNDBREAKERS. Take care.

好的。所以我認為這是最後一個問題。再次感謝您對公司的關注。每個人都享受夏天剩下的時光。希望我們很快就能在 GROUNDBREAKERS 見到您。小心。

Thank you. That does conclude today's teleconference. We appreciate your participation. You may disconnect your lines at this time and enjoy the rest of your day.

謝謝。今天的電話會議到此結束。我們感謝您的參與。此時您可以斷開線路並享受剩下的一天。