Retail Opportunity Investments Corp (ROIC) 2016 Q1 法說會逐字稿

Welcome to the Retail Opportunity Investments' 2016 first quarter conference call. Participants are currently in a listen-only mode. Following the Company's prepared comments, the call will be opened up for questions. Please note that certain matters discussed in this call today constitute forward-looking statements within the meaning of Federal Securities Laws. Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, the Company can give no assurance that these expectations will be achieved.

Such forward-looking statements involve known and unknown risk, uncertainties, and other factors which may cause actual results to differ materially from future results expressed or implied by such forward-looking statements and expectations. Information regarding such risk and factors is described in the Company's filings with the Securities and Exchange Commission including its most recent Annual Report on Form 10-K. Participants are encouraged to refer to the Company's filings with the SEC regarding such risks and factors as well as for more information regarding the Company's financial and operational results. The Company's filings can be found on its website.

Now I'd like introduce Stuart Tanz, the Company's Chief Executive Officer. Sir, you may begin.

Good morning, everyone. Here with me today is Michael Haines, our Chief Financial Officer; and Rich Schoebel, our Chief Operating Officer. We are pleased to report that the Company is off to a great start in 2016. We continue to fire on all cylinders executing our business plan across each of our core disciplines for full-year growth, property operations, leasing, and with our balance sheet. In terms of portfolio growth, we continue to have great success with our off-market relationship driven acquisition program. We continue to focus on acquiring well established grocery-anchored shopping centers in highly sought after very protected markets, properties that have been privately owned for many years. We've worked hard and for a long time in laying the groundwork in building relationships with private owners across each of our core markets.

Our efforts continue to bear fruit as we continue to have great success in acquiring exceptional real estate. In fact the acquisitions that we've lined up thus far in 2016 are all excellent examples of this. Specifically year-to-date we have secured $155 million of acquisitions. Towards the end of the first quarter in mid-March, we acquired two shopping centers in Santa Barbara for $64 million. As we discussed in our last earnings call, Santa Barbara is one of the most sought after markets on the West Coast given its strong demographic profile and supply constraint attributes. Yet it's one of the most difficult markets to enter given that most of the shopping centers have been privately owned and closely held by a select group of owners for many years. We have worked hard at establishing relationships with key owners in the market and our persistence finally paid off.

One of the key reasons for our success was that the seller sought to take ROIC currency. In fact we issued $46 million of OP units valued at $18.85 per unit, which is a new high for us. Notwithstanding it being a new high, the seller firmly believes in the growth prospects of the Company going forward. From our point of view, we financed the transaction on very efficient attractive terms with minimal costs. More importantly, we acquired two exceptional shopping centers that feature supermarkets that have very successful stores at the properties. Additionally, there are a number of great opportunities to re-lease and re-tenant below market space going forward. In addition to the Santa Barbara properties, we currently have two other grocery-anchored shopping centers under contract totaling about $91 million.

Just like Santa Barbara, we sourced both transactions through relationships with private owners. In fact in both cases, the owners reached out to us. One of which we had previously acquired a shopping center from so the seller knew us very well in our ability to perform. The other seller is a private owner that we've been calling on for a long time. Over the years we have acquired properties in the same submarkets as the seller so he knew our track record as being a reasonable buyer and a successful operator. In terms of the real estate, both shopping centers are well located in very protective submarkets. One being in Santa Clarita, which is a very strong submarket of LA and the other shopping center is located in Bellevue, which is considered one of the strongest vibrant submarkets in Seattle and is home to Microsoft.

In fact the property we are acquiring is located very close to our flagship property in Seattle, Crossroads Shopping Center, and is also very close to the property we acquired just recently in December, Sternco Shopping Center. Needless to say, as we grow our presence in this strong submarket, we intend to make the most out of the enhanced operating and leasing synergies. Additionally, both of these pending acquisitions are well established, well leased grocery-anchored shopping centers with a long history of stable cash flow. Looking ahead, both properties have significant rollover two to three years from now with in-place leases that are substantially below market by as much as 200% to 300%. So there's significant upside down the road, which we intend to make the most of.

Beyond the $155 million that we have secured year-to-date, our pipeline of off-market opportunities continues to be active and we remain on track thus far to reach our objective for the year of acquiring $300 million of shopping centers over the course of 2016. Turning to property operations, we continue to have great success at enhancing the value of our portfolio. We continue to maintain occupancy about 97% and continue to achieve double-digit growth in our re-leasing spreads. Additionally, we continue to proactively recapture below market underperforming space and release it to much stronger retailers at considerably higher rents.

Rich will discuss some of the details in a minute. But first, I'll turn the call over to Michael Haines, our Chief Financial Officer, to discuss our financial results. Mike?

Thanks, Stuart. For the three months ended March 31, 2016 the Company had $56.1 million in total revenues and $18.4 million in GAAP operating income as compared to $45.1 million in total revenues and $12.9 million in GAAP operating income for the first quarter of 2015. In terms of property level net operating income on a same-center comparative basis, which includes all of the shopping centers that we have owned since the beginning of 2015 totaling 61 properties, cash NOI increased by 7.6% for the first quarter of 2016 as compared to the first quarter of last year. The bulk of the increase, in fact two-thirds of it, was attributable to an increase in base rent thanks in large part to a number of new tenants rent commencing during the first quarter.

On our last earnings call, we projected that same-center NOI growth will be in the 4% to 5% range for the full year anticipating and notwithstanding that it would fluctuate each quarter. Looking ahead, given our strong first quarter performance, we now expect same-center NOI growth for the full-year 2016 will be in the 5% to 6% range. Bear in mind that an important component of our NOI growth relates to the timing of when new tenants take occupancy and commence paying rent, which in some cases can be a challenge to predict particularly when projecting out for a full year. Furthermore, as Stuart and Rich have discussed on past calls, the timing of new tenants taking occupancy is often tied to how slow or fast municipalities issue permits.

Turning back to our financial results. GAAP net income attributable to common shareholders for the first quarter of 2016 was $8.9 million equating to $0.08 per diluted share as compared to a GAAP net income of $4.4 million or $0.04 per diluted share for the first quarter of 2015. In terms of funds from operations, for the first quarter of 2016 FFO totaled $29.9 million as compared to FFO of $22 million for the first quarter of 2015. On a per share basis, FFO increased to $0.27 per diluted share for the first quarter of 2016. Approximately $0.015 of the $0.27 of FFO for the first quarter was non-cash GAAP income related primarily to a below-market anchor lease that we successfully recaptured at the end of the first quarter.

While we had targeted the lease as a potential recapture opportunity, we thought it would come to fruition further down the road. Having recaptured the lease early, the amortization of the below-market lease intangible is now being accelerated in accordance with GAAP and given that the rent was well below market and had considerable term left, the amortization now is meaningful totaling roughly $3.5 million. Because of the timing of the transaction, about half of that amount was recognized in the first quarter and the balance will be recognized in the second quarter. Taking that into account, we have increased our FFO guidance for the full year from our original range of $1 even to $1.04 per diluted share to new guidance range of $1.02 to $1.06 in FFO per diluted share for 2016.

This new guidance also takes into account our ongoing acquisition activity and property operations as well as potentially terming out short-term debt as we move through the year depending upon market conditions. Turning to the Company's balance sheet. At March 31, the Company had a total market cap of approximately $3.3 billion with approximately $1 billion of debt outstanding equating to a debt- to-total market cap ratio of 31.8%. For the first quarter, the Company's interest coverage was a strong 4.2 times. Also during the first quarter, we fixed $100 million of our floating rate debt through two swap agreements. The length of the swaps are three years for their credit line and term loan and have a blended fixed rate of 1.96%. With these swaps in place, two-thirds of our debt today is effectively fixed rate.

Now I'll turn the call over to Rich Schoebel, our COO, to discuss property operations. Rich?

Thanks, Mike. As Stuart indicated, we are firing on all cylinders with property operations and leasing making the most of the ongoing strong fundamentals across our markets. We continue to maintain our portfolio at high occupancy. In fact for the seventh consecutive quarter, we achieved a portfolio leased rate at or above 97% finishing the first quarter at 97.2%, which is a new first quarter record high. You may recall that we finished 2015 at the same 97.2% level. Typically in the first quarter, we usually experience a slight drop in occupancy following the holiday season. However, this year we had very little seasonal slippage across our portfolio and the demand for space in the first quarter was such that we were able to quickly and seamlessly re-lease the space and not miss a beat in terms of maintaining our overall portfolio occupancy.

Breaking the 97.2% number down between anchor and non-anchor space, at March 31 our anchor space was 99.6% leased and our shop space was 94.4% leased. With respect to the economic spread between occupied and leased space, as Mike indicated, a good number of new tenants took occupancy and commenced paying rent in the first quarter which helped to drive our same-center NOI growth. Specifically, during the first quarter new tenants representing approximately $1.8 million in annual cash rent took occupancy and started paying rent. As of the end of the quarter at March 31, the economic spread between occupied and leased space stood at 4.4% representing about $6 million in additional incremental annual base rent on a cash basis, which we expect will come online as we move through the year.

In terms of specific leasing activity in the first quarter, during the first three months we executed 101 leases totaling 298,000 square feet achieving a 12.7% increase in same-space comparative rents on a cash basis. Breaking that down, we executed 32 new leases totaling 112,000 square feet achieving a same-space comparative cash rent increase of 15.4% and we executed 69 renewals totaling roughly 186,000 square feet achieving an 11.8% increase in cash rents. And as both Stuart and Mike touched on, we continue to have good success with recapturing below-market underperforming space and re-leasing it to stronger retailers and at higher rents.

During the first quarter, the most notable transaction was the one that Mike referenced whereby we recaptured an underperforming anchor space that we had targeted as a potential opportunity, but to be conservative we expected would occur further down the road.

We wanted to make certain that we had the right retailer to take the space that would serve as a great draw to the center going forward. Capitalizing on our existing tenant base and relationships, we secured a great supermarket operator that has a strong customer base in the marketplace and is ideally suited for our shopping center given the demographic profile of the surrounding community. This one transaction alone will add about $400,000 in incremental annual cash flow. Additionally, looking ahead we currently have identified another 200,000 square feet to 300,000 square feet of additional potential recapture opportunities, which if successful we estimate could add as much as $1.5 million in annual incremental cash flow.

Now, I'll turn the call back over to Stuart.

Thanks, Rich. Before opening up the call for your questions, I would like to add a bit more color to Rich's comments regarding the demand for space across our portfolio and markets. In short, demand continues to be very strong. What's interesting is just how broad and diverse the demand is and how the trends differ across each of our markets. For example in Northern California, especially in the San Francisco Bay Area, we continue to see a growing number of retailers looking to enter the marketplace and we are continuing to see existing retailers looking to expand. Most notably, some of the bigger more established supermarket operators are exploring opportunities to open new locations and for the first time in our 25 years' experience, they are showing flexibility as to store formats including considering smaller footprints when need be in order to secure locations in highly desirable communities and well located shopping centers.

While these types of trends are taking hold in Northern California, in Southern California the biggest demand or trend is coming from the restaurant sector. New smaller gourmet concepts continue to grow by leaps and bounds and in some cases are replacing traditional fast food chains. The demand for these new food concepts is largely being driven by the growing trend of people eating out more often. And similar to the trend in Northern California, these new gourmet food concepts in Southern California are predominantly focused on leasing space in neighborhood shopping centers to be as conveniently located as possible. Needless to say, having these concepts in neighborhood centers is terrific in terms of the increased daily traffic and cross shopping synergies.

Lastly in the Pacific Northwest, the demand for space continues to be very diverse from traditional daily necessity retailers to discount retailers and more recently from a growing number of medical uses including urgent care and physical therapy clinics, all seeking to gain footholds in key residential submarkets and at the best located shopping centers. In summary, the strong and broad demand for space bodes very well for the future prospects of our business not just near term, but long term as well especially given how protected and supply constraint our markets are. We look forward to continuing to work hard at taking full advantage of the strong fundamentals to further enhance the value of our portfolio and to grow our business.

Now, we'll open up the call for your questions. Operator?

(Operator Instructions) Christy McElroy, Citi.

Just regarding the accelerated amortization of the below-market lease intangible, in which line item did that flow through in Q1? Was that in base rents and did that impact same-store NOI growth in the quarter?

It does flow through base rent line in the Q, but it does not affect same store to same store. That would be stripped out as a non-cash item for same-store purposes.

Okay. And it sounds like the timing of rent commencement here of the majority of the increase in the same-store NOI growth of 5% to 6%, sorry if I missed this. Where was the [least rent] commenced GAAP at Q1 and then where do you expect it to be at year-end 2016 at this point?

At the end of Q1 it was 4.4% so it actually [wind] a little bit from year-end and at the end of the year, again it's kind of hard to say where we'll be. It will depend on the leasing velocity that we do and kind of tied with our acquisitions through the year and what options we have to release those during the year. But for the leases that were completed at the end of March, I would expect most of those to be in and paying within the next six to nine months.

Okay. And then just lastly, your bad debt expense was pretty minimal in Q1, was there anything one-time in there that impacted that line item? Do you have any Sports Authority exposure?

We do. We have one. I'll let Rich talk about Sports Authority. I'll take the bad debt, I think it was just larger in first quarter of last year where we take out some underperforming tenants to replace them with starter tenants.

And ARs are certainly running a lot less. Although our ARs are typically 1% of our revenues. Sports Authority.

So on the Sports Authority, we only have one Sports Authority in the portfolio it's up in Seattle at our Crossroads property. The store was not on their initial closure list and in fact the customer traffic and activity at this store actually continued to perform well. That said, it appears that the Sports Authority will simply go and liquidate at this point which we view as a positive. The rent is below market. We've been 100% leased at Crossroads for the past three years running and have significant demand. So, we think that if they end up liquidating and we get the space back, it will be good for us.

Okay. So just to be clear, just looking at bad debt, it looks like you did not reserve for any pre-petition rent in Q1 for that store?

No. And they really just owe us the one month rent pre-petition, very small amount.

Got you, okay. Thank you.

Collin Mings, Raymond James.

First question from me just on the two assets you have under contract to acquire. Can you talk a little bit more about potentially funding those? Are OP units likely on either of these deals? Is there going to be any assumption of debt?

No. They're both unencumbered and no OPs so we are drawing down our facility or paying cash for both assets.

Okay. And then I guess just on that front, Mike, just maybe update us with the credit line now at about $170 million just as far as timing and potential pricing of some longer-term financing?

So, we keep a careful eye on the market. The public bond market the spreads are still kind of wide for us right now. I think the latest indication pricing I got was like [280] over the 10-year, which we still think is kind of pricey. So, we're looking at potentially maybe doing some swaps or maybe moving to the private placement market where we think the pricing is better. We'll look to do some fixing of some of our debt over the balance of the year.

Okay. Stuart, I know we've talked a lot in the past about disposition plans. I know that a couple months ago, again you highlighted you had Sacramento and maybe the neighborhood of $50 million of dispositions this year, maybe just update us on the progress on that front?

Yes, we are still targeting some dispositions. We're contemplating selling in total about $50 million so nothing of any real significance. And as we built our portfolio over the last six years, we have been highly selective and disciplined in the type of shopping centers that we've acquired and one of our key objectives of course is to focus on acquiring centers that are in irreplaceable highly sought after locations, most of them being privately owned with a lot of opportunity to enhance value. So, we will continue to look at our portfolio and we'll begin to sell off just a handful of assets again primarily Sacramento. So, you'll start to see that process pick up in the second and third quarter of this year.

Okay. And then just one last one from me and then I'll turn it over. In your remarks, Stuart, you talked a little bit about just seeing more demand from healthcare related tenants. I'm just curious how much as far as leasing activity or as far as percentage of your portfolio does that actually represent right now?

It's not on our Top 10. So it's going to account --.

Pretty hard to put a number on it. I think it's just a trend that we're seeing where a lot of these traditional retailers are going more to these service type users, particularly medical. So, we don't really have a percentage for you.

Okay. Thanks, guys.

Paul Morgan, Canaccord.

On the lease that had a non-cash impact, do you have any more color on just kind of where the center was and you said you leased it to a new supermarket, any additional kind of specifics there?

It's located in certainly one of the strongest markets on the West Coast, which is San Jose in the Bay Area.And are we at liberty to say who the tenant is?

Yes, we can.

We had a local operator up there, a Bay Area grocery operator up there who was not performing very well and what we brought in is Hmart. As you probably know, we have Hmart at a couple other centers and they are now going to be replacing this local operator with virtually no downtime as it relates to the income stream and

given the demographics of the particular property, they're going to be a great fit there.

So, that lease commences very soon then?

From a rent stream, yes. The old operator is just closing down and they are going to fit out the store for probably 45, 60 days and then reopen as the Hmart, but the income is already coming.

And actually this is one of the ones that you've talked about, I can't remember the exact number, nine or so that you had identified in terms of anchor spaces that you might look to recapture. Are there any others like that we could see materializing this year? Is there any kind of update on the status of kind of that pipeline?

I think what you'll see is, you'll see on our anchor expiration schedule, we have two more leases scheduled to expire this year. Both of those we're currently in active negotiations with much stronger retailers to take over those locations. We would expect to have something to announce later this year on both of those.

We are making good progress, Paul, on a number of fronts which in terms of income will obviously roll in late in the year or in 2017. The other thing that we're making very good progress on that we haven't yet articulated is pads at our shopping centers. We have a pipeline of about nine projects currently in the stages of either breaking ground or in the entitlement process. Those pads will come on late in the year and in 2017 as well. We estimate another $2.5 million of NOI from that aspect on top of the initiatives. So if all of this comes together, I think the Company will certainly continue to have very strong same-store NOI growth and I think it's going to be just as strong looking ahead in 2017 as it is in 2016.

And then just lastly, you've talked about cap rates on some of your recent deals and I think a lot of them were kind of in the mid 5%s or something like that. Is that about where you ended up or lower on the two deals just announced?

No, mid-5%s for the two deals that we put under contract, but cap rates I think I had mentioned to investors and the market late last year that I believe valuations would continue to go up and cap rates continue to go down in 2016 and that's exactly what we are seeing on the West Coast. Assets that are a lot like what we own and operate are now trading in the low 4s and in some cases even at 4 or a bit less. So valuations continue to head up, cap rates continue to head down.

Great. Thanks.

Jim Lykins, D.A. Davidson.

Congrats on the quarter. First of all, for the two properties of our contract, can you give us a sense for when you expect both of those to close and also can you give us a better feel for how much you think you will be able to push rents at both of these properties?

Bouquet is going to close today actually or it (technical difficulty) at some point today. And Bridle Trail, that is a 1031 exchange so we have given the seller 30 day windows in order to extend now if the deal is committed to. So we're done with due diligence and we have a hard transaction, but the seller does have up to about another 90 days to close. So, this one in terms of closing it could end up being two weeks from now or it could end up being two-and-a-half months from now. We will get a bit more clarity on this in the next couple of weeks, but it is a committed transaction on both sides.

So you've talked about $300 million pipeline for the year, you're already at $155 million. I'm just wondering if you're maybe taking a little bit of a conservative stance. I mean from what you're seeing out there, do you think that we might see an upward revision? Can you just give us a feel for should we continue to expect that $300 million for the year or will that possibly be a little bit higher do you think?

Our pipeline is very strong. As always, we're being very disciplined in terms of our approach. Right now although we're off to a great start with the discipline that we've got in terms of what we're buying, I really at this point would want to stay conservative and stay at $300 million. That may change, but right now we're still very comfortable with the $300 million number.

[Hopefully] the acquisitions grow ratably over the year and the first $64 million came in midway through March. We're going to be closing one today, knock on wood, and the other one -- that's kind of on par with our pace for the year.

Okay. Thanks, guys.

Todd Thomas, KeyBanc Capital Markets.

Rich, the 200,000 square feet to 300,000 square feet of additional recapture opportunities that you mentioned that you identified this quarter. What caused them to be newly identified today versus say a few quarters ago? I'm guessing in-place rents haven't changed much. So, is it a function of increases in market rents or the pipeline of backfill opportunities or something else?

Todd, I guess I wouldn't say it's something we've just recently identified. It's sort of just the initiatives we've been working on over the last 12 to 6 months and some of these things obviously take time to have these leases term out or work out or have that replacement tenant identified.

So, we don't see it as something that's an ongoing initiative. One or two of these popped up in terms of some more recent acquisitions so these initiatives will continue to build as we continue to grow the portfolio.

And then, Stuart, the deals that you're buying pricing in the mid-5% range. You're saying cap rates have compressed some. Should we assume that the initial yields on deals going forward throughout the balance of the year for ROIC come in a little bit?

Yes, I would assume that yields will probably for us move down a bit into the lower 5%s rather than the mid 5%s. However, every deal is different and for us it's not so much. I mean obviously the going-in yield is really important, but the most important aspect is what we see in terms of rollover and risk at the same time. And so it's the juice that's important to us, what can our management team do with these assets once we close in order to create 100 basis points to 200 basis points within 18 months of closing. That is the criteria and the goal that is set that we focus on on what we acquire. So the yields may move down a bit, they may move up. Every transaction is going to be a bit different, but I feel very good in terms of looking ahead and where we're at.

And then just following up on Sacramento or on the dispositions in general. Is there anything on the market today and is it primarily Sacramento or are there some other assets outside of that market that are being contemplated for sale?

Initially we were going to look at an asset in the Bay Area and the good news is that we have a very strong grocery operator that has committed to, and it was the only asset that wasn't grocery-anchored in our portfolio. Office Depot is leaving in April and we've brought in a very strong tenant, this is in Pleasant Hill right near Walnut Creek, to take possession paying us about 15% or 20% more in rent. So now that we have landed and signed this lease, we want to get the tenant open. But this asset we're probably going to keep now for a little while. Turning to Sacramento. The one asset that we have, which is a large asset that we're going to bring to market over the next several months is located in Sacramento and the good news there is that we've done a lot of good leasing there over the last six months. The tenants will be open in the next 30 to 90 days and this asset is ready now to bring to the market. And then maybe one other asset as well in the Sacramento market. That's really where we have our eye right now in terms of dispositions. Now we do look through the portfolio frequently and look at assets where we feel there isn't much internal growth left. But given how good the fundamentals are across our portfolio, we continue to see a lot of embedded growth in most of what we own.

Okay. That's helpful. Thank you.

Michael Mueller, JP Morgan.

I guess going back to the refinancing and the comments about terming out or fixing some more debt. Can you just give like a rough idea about what's the magnitude of what you're looking at swapping or replacing?

I think we're looking at probably doing somewhere between $200 million and $300 million of fixing net debt. Right now we have about $365 million of floating rate debt. We're going to be drawing them in the line obviously as we continue to grow. So, we're looking to make our fixed rate debt percentage higher than where it is today.

And then on the acquisition side and just not necessarily thinking about cap rates. But just are you seeing anything where potentially more product is coming to market because people are worried about cap rates or I guess has there been any change in the pace of what you're looking at?

Yes, we've seen a bit of an acceleration in terms of widely marketed deals. A number of these deals have been recirculated. These are assets that were purchased maybe a year to two years ago that sellers now want to monetize. Outside of that, I don't get any feeling that there's a fear in the market as it relates to the flow of these assets and the good news is that the flow is strong. But to me the flow is really I would tell you private owners and/or institutions that bought these assets with the focus of only having a two to three year horizon. And that's what we're seeing right now in terms of widely marketed deals.

Got it. Okay. Thank you.

Chris Lucas, Capital One Securities.

On Crossroads given the position of the Sports Authority, is it more likely if that box comes back that you will be looking at some sort of just backfilling to retail or is there opportunity to do more density at that location?

It's a great question and the answer is yes. This is potentially going to give us a huge opportunity as it relates to redeveloping the asset. We have already started looking at phase 2 of the Crossroads and have begun to look at the next sort of stage in terms of redevelopment. If we get Sports Authority back, there is a good chance that this is going to open up the project a lot more than what we had anticipated. So, the answer is yes. This could provide a very big opportunity to continue to really build some value at the Crossroads. And I don't know if you want to add anything, Rich.

I mean we always targeted this area as one of the potential redevelopment phases. As Stuart was articulating, we've already started on the second redevelopment phase but this could just accelerate all the timing for phase 2 and potentially phase 3 to come a lot quicker than we had originally anticipated.

And then Mike, just a couple of cleanup questions for you. You had mentioned that the guidance for the year for same-store NOIs in the 5% to 6% range. Had you provided a range to us previously?

I think we've always said 4% to 5%.

And then as it relates to the tenant recovery for the quarter seemed to spike over kind of where it had been trending. Was there anything one-time in nature or unique in the first quarter that we should be thinking about or is this a good run rate at this point and what happened here?

I think it's just the indication of the strengthening of our recovery language. We've replaced some tenants. It's basically new leases that commenced during the past year where we replaced weak recovery language. Our standard lease formats is much tighter on the recovery language.

Great, thank you. Appreciate the time.

Thank you. And at this time, I'm showing there are no further participants in the queue. I'd like to turn the call back to management for any closing remarks.

In closing, I'd like to thank all of you for joining us. If you have any additional questions, please feel free to contact Mike, Rich, or myself. You can find additional information in the Company's quarterly supplemental package, which is posted on our website. And lastly for those who are attending ICSC's convention in Las Vegas next month starting May 23, please stop by our booth which will be in the South Upper Hall at the corner of N Street and 50th Avenue. We hope to see you there. Thanks again and have a great day everyone.

Ladies and gentlemen, thank you for your participation on today's conference. This concludes the program. You may now disconnect. Everyone have a great day.