Whitestone REIT (WSR) 2022 Q4 法說會逐字稿

Greetings, and welcome to the Whitestone REIT Fourth Quarter and Full Year 2022 Earnings Call. (Operator Instructions) As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Mr. David Mordy, Director of Investor Relations for Whitestone REIT. Thank you. You may begin.

您好，歡迎來到 Whitestone REIT 第四季度和 2022 年全年收益電話會議。 （操作員說明）提醒一下，正在錄製此會議。我現在想將會議轉交給您的主持人，Whitestone REIT 投資者關係總監 David Mordy 先生。謝謝。你可以開始了。

Good morning, and thank you for joining Whitestone REIT's Fourth Quarter and Full Year 2022 Earnings Conference Call. Joining me on today's call are Dave Holeman, Chief Executive Officer; Christine Mastandrea, Chief Operating Officer; and Scott Hogan, Chief Financial Officer.

早上好，感謝您參加 Whitestone REIT 的第四季度和 2022 年全年收益電話會議。與我一起參加今天電話會議的還有首席執行官戴夫·霍爾曼 (Dave Holeman)； Christine Mastandrea，首席運營官；和首席財務官 Scott Hogan。

Please note that some statements made during this call are not historical and may be deemed forward-looking statements. Actual results may differ materially from those forward-looking statements due to a number of risks, uncertainties and other factors. Please refer to the company's earnings news release and filings with the SEC, including Whitestone's most recent Form 10-Q and 10-K for a detailed discussion of these factors.

請注意，在本次電話會議中所做的一些陳述不是歷史性的，可能被視為前瞻性陳述。由於許多風險、不確定性和其他因素，實際結果可能與這些前瞻性陳述存在重大差異。請參閱公司的收益新聞稿和向美國證券交易委員會提交的文件，包括 Whitestone 最近的 10-Q 和 10-K 表格，以詳細討論這些因素。

Acknowledging the fact that this call may be webcast for a period of time, it is also important to note that this call includes time-sensitive information that may be accurate only as of today's date, March 1st, 2023. The company undertakes no obligation to update this information. Whitestone's fourth quarter earnings news release and supplemental operating and financial data package have been filed with the SEC and are available on our website in the Investor Relations section.

承認本次電話會議可能會在一段時間內進行網絡直播，還需要注意的是，本次電話會議包含時效性信息，這些信息可能僅在今天，即 2023 年 3 月 1 日之前是準確的。公司不承擔任何義務更新此信息。 Whitestone 的第四季度收益新聞稿以及補充運營和財務數據包已提交給美國證券交易委員會，並可在我們網站的投資者關係部分獲取。

We published fourth quarter 2022 slides on our website yesterday afternoon, which highlighted topics to be discussed today. I will now turn the call over to Dave Holeman, our Chief Executive Officer.

我們昨天下午在我們的網站上發布了 2022 年第四季度的幻燈片，突出顯示了今天要討論的主題。我現在將把電話轉給我們的首席執行官戴夫霍爾曼。

Thanks, David, and good morning, everyone. Thank you for joining us today. We have very strong results that I'm eager to discuss, but I wanted to start by sharing our vision. At Whitestone, our vision is to create the American Dream in our centers through inspired team members who position clients for success and to meet the evolving needs of thriving communities. We continually strive to champion a best-in-class team to create value in real estate better than anyone in our business. There are many aspects of that vision that keep me, and the team humble and passionate about what we do every day.

謝謝，大衛，大家早上好。感謝您今天加入我們。我們有非常好的結果，我很想討論，但我想首先分享我們的願景。在 Whitestone，我們的願景是通過鼓舞人心的團隊成員在我們的中心創造美國夢，他們將客戶定位為成功並滿足繁榮社區不斷變化的需求。我們不斷努力打造一流的團隊，以比我們業務中的任何人更好地創造房地產價值。這一願景有很多方面讓我和團隊對我們每天所做的事情保持謙虛和熱情。

2022 was a very good year for Whitestone on many fronts. We exceeded our annual guidance for FFO per share, same-store NOI growth, G&A and net debt-to-EBITDAre. We ended the year on an especially high note with strong fourth quarter results, hitting record occupancy for the company and achieving it with very robust leasing spread levels. We continue to see the results from our strategic focus on the right locations in growing markets, convenience-focused shopping centers that have a large amount of smaller spaces and minimal big boxes. We populate our centers with an optimal mix of tenants that meet the evolving needs of thriving communities. We benefited from a number of positive macroeconomic trends driving neighborhood demand and supporting our growth, including hybrid work, migration to the sun-belt and population shifts towards suburban markets. These demand factors are further amplified by limited new supply in our markets.

2022 年對白石來說在許多方面都是非常好的一年。我們超出了每股 FFO、同店 NOI 增長、G&A 和淨債務與 EBITDAre 的年度指導。我們以特別高的成績結束了這一年，第四季度業績強勁，公司入住率創下歷史新高，並以非常強勁的租賃利差水平實現了這一目標。我們繼續看到我們的戰略重點是在不斷增長的市場中的正確位置，以便利為中心的購物中心，這些購物中心擁有大量較小的空間和最小的大盒子。我們為我們的中心提供最佳租戶組合，以滿足繁榮社區不斷變化的需求。我們受益於一些推動社區需求和支持我們增長的積極宏觀經濟趨勢，包括混合工作、向陽光地帶的遷移以及人口向郊區市場的轉移。我們市場上有限的新供應進一步放大了這些需求因素。

Our 2022 strong performance is a testament of the quality of our centers, the strength of our tenants, and the hard work of our team. We anticipate the positive momentum will continue, and we're looking forward to building on our success in 2023.

我們 2022 年的強勁表現證明了我們中心的質量、租戶的實力以及我們團隊的辛勤工作。我們預計積極勢頭將持續下去，我們期待在 2023 年取得成功。

Let me provide a few highlights from a year of major accomplishments on multiple fronts. We grew FFO by nearly 20% to $1.03 per share. This was accomplished by staying laser-focused on leasing throughout the year, raising our occupancy by 240 basis points to 93.7% and achieving same-store NOI growth of nearly 8%. Our fourth quarter ending occupancy improved sequentially from the record occupancy we reported in Q3 by an additional 120 basis points.

讓我介紹一年來在多個方面取得的重大成就中的一些亮點。我們將 FFO 增長了近 20%，達到每股 1.03 美元。這是通過全年專注於租賃來實現的，將我們的入住率提高了 240 個基點，達到 93.7%，並實現了近 8% 的同店 NOI 增長。我們第四季度末的入住率比我們在第三季度報告的創紀錄入住率又提高了 120 個基點。

Straight-line leasing spreads were 16.6% for the year, and a positive 23.5% for the fourth quarter. We improved our debt-to-EBITDA ratio to 7.8x from 9.1x a year ago. We realized this primarily through strong EBITDA growth, supported by capital recycling from acquisitions and dispositions that met our dual criteria of growing FFO per share and improving leverage. During 2022, we sold 6 properties for an aggregate price of $35.8 million at a 5.6% cap rate and acquired 2 properties with greater current, and future upside for an aggregate price of $27.5 million at a 7 cap rate. As a reminder, our debt-to-EBITDA ratio stood at over 10x in 2020. So we've made great progress in just 2 years. We lowered our G&A expenses by $4.6 million from the 2021 level. Although we did benefit from some onetime reductions that will not repeat in future years.

全年直線租賃利差為 16.6%，第四季度為正 23.5%。我們將債務與 EBITDA 的比率從一年前的 9.1 倍提高到 7.8 倍。我們主要通過強勁的 EBITDA 增長實現了這一點，這得到了收購和處置的資本回收的支持，這些收購和處置符合我們增加每股 FFO 和提高槓桿率的雙重標準。在 2022 年期間，我們以 5.6% 的上限率以 3580 萬美元的總價出售了 6 處房產，並以 7 的上限率以 2750 萬美元的總價收購了 2 處具有更大當前和未來上漲空間的房產。提醒一下，我們的債務與 EBITDA 的比率在 2020 年超過 10 倍。因此我們在短短 2 年內取得了長足進步。我們將 G&A 費用從 2021 年的水平降低了 460 萬美元。儘管我們確實受益於一些在未來幾年不會重複的一次性削減。

Scott will provide greater clarity to our future G&A or corporate credit facility, adding additional liquidity, fixing the rate on 82% of our debt and moving the bulk of our maturities out to 2027 and beyond. We received an investment grade credit rating. We engaged heavily with shareholders and analysts increasing our interaction with, and ownership by institutions while adding sell-side coverage. And importantly, we showed our commitment to corporate responsibility through our ESG actions which included multiple governance improvements, submission of our first GRESB filing and publishing of an updated corporate ESG report. The efforts we made in this area were recognized by ISS with year-over-year improvements in our governance score from 9 to 3; in our environmental score from 8 to 6; and in our social score from 4 to 3. These efforts truly position us well for 2023 as we enter the year with great momentum on the leasing side fueled by strong tenant demand and shorter lease structures, which will allow us to grow rents across our portfolio.

斯科特將為我們未來的 G&A 或公司信貸安排提供更清晰的信息，增加額外的流動性，將利率固定在我們 82% 的債務上，並將我們的大部分到期日推遲到 2027 年及以後。我們獲得了投資級信用評級。我們與股東和分析師進行了大量接觸，增加了我們與機構的互動和機構的所有權，同時增加了賣方覆蓋範圍。重要的是，我們通過我們的 ESG 行動表明了我們對企業責任的承諾，其中包括多項治理改進、提交我們的第一份 GRESB 文件和發布更新的企業 ESG 報告。我們在這方面所做的努力得到了 ISS 的認可，我們的治理得分從 9 分逐年提高到 3 分；我們的環境得分從 8 分提高到 6 分；我們的社會評分從 4 升至 3。這些努力確實使我們在 2023 年處於有利地位，因為我們在強勁的租戶需求和較短的租賃結構的推動下進入了租賃方面的強勁勢頭，這將使我們能夠在我們的投資組合中增加租金.

In the third quarter of 2022, we shared that over 40% of our properties were at 95% or greater occupancy. As of year-end, nearly 60% of our properties were at or above 95% occupancy, and our overall occupancy rate hit a record 93.7%. Anchored occupancy for spaces over 10,000 square feet were 98% and small space occupancy hit 91.2%. One area that is a significant differentiator for Whitestone is that over 60% of our leasable square footage is in smaller spaces, which we believe to have much greater demand, more flexibility provide premium rents, and we have occupancy upside in our portfolio in those spaces.

在 2022 年第三季度，我們分享了超過 40% 的物業的入住率達到 95% 或更高。截至年底，我們近 60% 的物業入住率達到或超過 95%，整體入住率達到創紀錄的 93.7%。超過 10,000 平方英尺的固定入住率為 98%，小空間入住率為 91.2%。 Whitestone 的一個顯著差異化因素是，我們超過 60% 的可出租面積位於較小的空間，我們認為這些空間的需求更大，靈活性更高，租金更高，而且我們在這些空間的投資組合中有入住率上升空間.

As individual centers near full occupancy and tenant demand remains constant, we are presenting with tremendous opportunity to accelerate ABR growth through disciplined selection of a strong and successful tenants. With our small space focus, we diversify our risk over more tests per center and shorter leases with more flexible lease terms than our peers. There has never been a better time to prove our differentiated strategy, and ensure that our centers are populated with high demand businesses that meet the needs of their surrounding communities.

隨著個別中心接近滿員和租戶需求保持不變，我們提供了巨大的機會，通過嚴格選擇強大和成功的租戶來加速 ABR 的增長。憑藉我們對小空間的關注，我們通過比同行更靈活的租賃條款分散了每個中心更多測試和更短租約的風險。現在是證明我們的差異化戰略並確保我們的中心擁有滿足周圍社區需求的高需求企業的最佳時機。

Let me now just take a moment to comment on the environment in which we operate today. We understand that this strong economic environment as we see it through the eyes of our tenant, and in our current and ongoing leasing success does not necessarily match with the expectations of many Fed focused investors. We have no crystal ball in terms of the economic impact of taming inflation. But what we can do is stay focused on a strategy which we believe will provide stronger returns for our investors, regardless of the macroeconomic environment ahead.

現在讓我花點時間評論一下我們今天運營的環境。我們明白，我們通過租戶的眼光看到的這種強勁的經濟環境，以及我們目前和持續的租賃成功並不一定符合許多以美聯儲為中心的投資者的預期。就抑制通貨膨脹的經濟影響而言，我們沒有水晶球。但我們能做的是繼續專注於我們認為將為我們的投資者提供更高回報的戰略，無論未來的宏觀經濟環境如何。

Our focus remains on staying disciplined and adhering to our strategy, remaining patient with respect to acquisitions and dispositions, continuing to drive industry-leading same-store NOI growth, continuing to strengthen our balance sheet by improving our debt metrics, continuing to reduce our overhead costs as a percent of revenue and, most importantly, being passionate about driving growth in FFO per share and long-term value for shareholders.

我們的重點仍然是保持紀律和堅持我們的戰略，對收購和處置保持耐心，繼續推動行業領先的同店 NOI 增長，通過改善我們的債務指標繼續加強我們的資產負債表，繼續減少我們的管理費用成本佔收入的百分比，最重要的是，熱衷於推動每股 FFO 的增長和股東的長期價值。

I would like to thank my fellow Whitestone team members for their hard work in 2022. I thank you for your contribution to the progress we've made and our team looks forward to delivering for our shareholders again in 2023. And with that, I'll turn it over to Christine to discuss operations .

我要感謝我的 Whitestone 團隊成員在 2022 年的辛勤工作。我感謝你們為我們取得的進步所做的貢獻，我們的團隊期待在 2023 年再次為我們的股東做出貢獻。因此，我我會把它交給克里斯汀來討論操作。

Good morning, everyone. As Dave mentioned, we've achieved strong results in 2022, improving occupancy by 240 basis points to 93.7%. We believe we have further to go in the terms of occupancy gains. But there will be a strong focus on remerchandising in 2023. And so same-store NOI becomes a bigger growth driver going forward. We outperformed on a relative basis with a 7.9% same-store NOI growth in 2022, and we're poised for a strong growth again in 2023. With our locations in sun-belt cities in high-growth, high-income neighborhoods and our focus on service and necessity-based tenants, we are well positioned for stability through COVID.

大家，早安。正如 Dave 提到的，我們在 2022 年取得了不錯的成績，入住率提高了 240 個基點，達到 93.7%。我們相信我們在入住率方面還有進一步的提升。但 2023 年將重點關注再銷售。因此，同店 NOI 將成為未來更大的增長動力。我們在相對基礎上表現出色，2022 年同店 NOI 增長 7.9%，我們準備在 2023 年再次實現強勁增長。憑藉我們在高增長、高收入社區的陽光地帶城市的位置以及我們的專注於服務和基於需求的租戶，我們在通過 COVID 保持穩定方面處於有利地位。

We are now striving for additional upside through operational discipline and successfully serving our communities. With the management change in 2022, we aligned as a team to execute and lean into the paradigm shift in retail. As we settle into a hybrid work model for the long term rather than just a facet of the pandemic, consumers have much more time close to home. And we're looking for local connections, both for work and how they increase time spent with family. Whitestone strategy begins with our acquisition team engaging in consumer traffic, selection and competitive positioning in prime locations.

我們現在正在通過運營紀律和成功地為我們的社區服務來爭取更多的好處。隨著 2022 年的管理層變動，我們作為一個團隊進行調整，以執行並適應零售業的範式轉變。隨著我們長期適應混合工作模式，而不僅僅是大流行的一個方面，消費者有更多的時間在家附近。我們正在尋找當地人脈，無論是為了工作，還是為了增加與家人相處的時間。白石戰略始於我們的收購團隊在黃金地段從事消費者流量、選擇和競爭定位。

Our fourth quarter acquisition of the Lake Woodlands Center is a perfect example. Lake Woodlands is a convenience center across from the HEB grocer and adjacent to a top-performing fitness center, driving a steady and consistent stream of traffic to the location. With the 1-mile radius average household income in excess of $250,000, it is ideally positioned for the ease of access to that neighborhood. This center starts with an average base rent per square foot of above $30 per square foot. We anticipate filling the 11% vacancy, allowing us to surpass the income from the dispositions we just completed and improve the quality of our portfolio.

我們第四季度對 Lake Woodlands Center 的收購就是一個很好的例子。 Lake Woodlands 是 HEB 雜貨店對面的一個便利中心，毗鄰一個性能一流的健身中心，為該地點帶來了穩定和一致的交通流。 1 英里半徑的平均家庭收入超過 250,000 美元，地理位置優越，方便前往該社區。該中心的每平方英尺平均基本租金超過每平方英尺 30 美元。我們預計將填補 11% 的空缺，使我們能夠超過剛剛完成的處置的收入，並提高我們投資組合的質量。

Also core to our strategy is evaluating what makes the entrepreneurial businesses succeed. Our differentiator is making sure our Whitestone employees see businesses within eye on how profits are made. Our underwriting process isn't just looking at the business for a current lease. But with the anticipation that a business will remain in growing our locations with a light span of 10 to 20 years. Our strong same-store NOI performance is a reflection of the success of our tenants, and their ability to consistently serve their communities. And because we have a lot of tenants whose businesses are thriving, we're able to accelerate our same-store NOI growth.

我們戰略的核心還在於評估創業企業成功的原因。我們的差異化因素是確保我們的 Whitestone 員工在關注企業利潤是如何產生的。我們的承銷流程不僅僅著眼於當前租約的業務。但是，預計在 10 到 20 年的光跨度內，企業將繼續發展我們的地點。我們強大的同店 NOI 表現反映了我們租戶的成功，以及他們始終如一地為社區服務的能力。而且因為我們有很多業務蒸蒸日上的租戶，所以我們能夠加快同店 NOI 的增長。

Although I expect most of our tenants become long-standing and renewing leases multiple times, we intentionally structure leases for a 3- to 5-year terms because we have confidence in the trajectory of our tenants and the trajectory of our centers. Within the retail sector, availability of 2,500 to 3,000 square foot spaces, especially in well-designed and well-located centers is limited. This isn't just the construction has slowed in our markets, which it certainly has, rather, its demand has increased as time conscious consumers have shifted to shorter local excursions in their neighborhoods.

雖然我預計我們的大多數租戶都會成為長期租戶並多次續租，但我們有意將租約安排為 3 至 5 年，因為我們對租戶的發展軌跡和我們中心的發展軌跡充滿信心。在零售業，2,500 至 3,000 平方英尺的空間有限，尤其是在設計良好且位置優越的中心。這不僅僅是我們市場的建設放緩，它肯定已經放緩，相反，隨著有時間意識的消費者轉向在他們的社區進行較短的本地遊覽，其需求增加了。

The pandemic accelerated the consumers' need for convenience while increasing their desire for connections. Whitestone is the right fit for growing tenant categories, restaurant, fitness, medical, financial and education, entertainment. In the fourth quarter, we added EoS fitness to our Williams Trace Plaza location in Houston, replacing an aging and low-performing grocery store. This center is located in Sugar Land, Texas, a fast-growing and young, diverse community outside of Houston and the change immediately jumped up the average base rent per square foot for the entire center by 38%.

大流行加速了消費者對便利的需求，同時增加了他們對聯繫的渴望。 Whitestone 非常適合不斷增長的租戶類別、餐廳、健身、醫療、金融和教育、娛樂。在第四季度，我們在休斯頓的 Williams Trace Plaza 門店增加了 EoS Fitness，取代了一家老化且業績不佳的雜貨店。該中心位於得克薩斯州舒格蘭，這是休斯頓以外一個快速發展、年輕、多元化的社區，這一變化立即使整個中心每平方英尺的平均基本租金上漲了 38%。

By proactively remerchandising for the neighborhood needs, we've been able to reposition the location to a younger, diverse and growing demographic and thereby increasing traffic levels for the center. We often talk about quality of revenue. While the most important aspect of quality of revenue is the strength of the tenant, it's also important to note that over 90% of our leases are triple net leases, and the majority of those leases have an annual rent escalator of 3% to 4%. We firmly believe that 2023 will be another strong year in terms of our operational performance, showcasing the value of our differentiated strategy. And with that, I'll turn it over to Scott.

通過主動根據社區需求進行再銷售，我們已經能夠將地點重新定位為更年輕、多樣化和不斷增長的人口，從而增加中心的交通水平。我們經常談論收入質量。雖然收入質量最重要的方面是租戶的實力，但同樣重要的是要注意，我們超過 90% 的租約是三倍淨租約，其中大部分租約的年租金上漲幅度為 3% 至 4% .我們堅信，2023 年將是我們經營業績又一個強勁的一年，展示我們差異化戰略的價值。有了這個，我會把它交給斯科特。

Thanks, Christine. I'll walk through our earnings drivers in 2022 and anticipated drivers for 2023, so investors and analysts have a better understanding of what to expect. All of this is shown on Slide 8. We finished 2022 with FFO per share of $1.03. And which includes $0.04 of onetime benefit associated with forfeitures of restricted shares. Exclusive of the $0.04 of onetime cost savings we generated an additional $0.13 per share in 2022 from our 2021 level. The key drivers of that change are a same-store NOI increase of 7.9% translating to $0.13 per share. G&A reductions of $4.6 million or $0.09 per share, with $0.04 being onetime, which we separate on the walk on Slide 8.

謝謝，克里斯汀。我將介紹 2022 年的盈利驅動因素和 2023 年的預期驅動因素，以便投資者和分析師更好地了解預期結果。所有這些都顯示在幻燈片 8 上。我們以每股 1.03 美元的 FFO 結束了 2022 年。其中包括 0.04 美元與沒收限制性股票相關的一次性收益。不包括 0.04 美元的一次性成本節省，我們在 2022 年從 2021 年的水平上額外產生了 0.13 美元的每股收益。這一變化的主要驅動因素是同店 NOI 增長 7.9%，相當於每股 0.13 美元。 G&A 減少 460 萬美元或每股 0.09 美元，一次性減少 0.04 美元，我們在幻燈片 8 中將其分開。

Other primarily non-same-store NOI for a positive $0.02 per share contribution and higher interest expense resulting in a $0.07 per share decrease. Looking forward to 2023, we are projecting FFO per share to be in the range of $0.95 to $0.99. Using the 2023 guidance midpoint of $0.97 per share. The key drivers of the change from 2022, our same-store NOI growth of $0.06 per share. Based on ending occupancy of 93.5% to 94.5%, G&A savings of $0.02, other primarily non-same-store NOI improvements for a positive $0.01 variance, and higher interest expense is anticipated to result in a negative variance of $0.11 per share for 2023. This is primarily a result of the refinancing we did in the third quarter of 2022 as well as the current SOFR curve.

其他主要非同店 NOI 每股貢獻 0.02 美元，利息支出增加導致每股減少 0.07 美元。展望 2023 年，我們預計每股 FFO 將在 0.95 美元至 0.99 美元之間。使用 2023 年每股 0.97 美元的指導中點。從 2022 年開始變化的主要驅動因素是我們的同店 NOI 每股增長 0.06 美元。基於 93.5% 至 94.5% 的結束入住率，G&A 節省 0.02 美元，其他主要非同店 NOI 改善為 0.01 美元的正方差，以及更高的利息支出預計將導致 2023 年每股 0.11 美元的負方差。這主要是我們在 2022 年第三季度進行的再融資以及當前的 SOFR 曲線的結果。

We anticipate that a 100 basis point move of the SOFR curve will result in a $0.0203 per FFO share variance, either a headwind or a tailwind depending on the direction of the rates.

我們預計 SOFR 曲線移動 100 個基點將導致每股 FFO 份額變動 0.0203 美元，這可能是逆風也可能是順風，具體取決於利率的方向。

In 2022, we had approximately $2 million or $0.04 per share from percent sales revenue with a little over half of that in the fourth quarter when many tenants hit their annual breakpoints. We anticipate a similar pattern in 2023, and we anticipate we'll finish with a stronger fourth quarter in 2023.

2022 年，我們的銷售收入百分比約為 200 萬美元或每股 0.04 美元，其中略多於第四季度的一半，當時許多租戶達到了年度斷點。我們預計 2023 年會出現類似的模式，我們預計我們將在 2023 年以更強勁的第四季度結束。

A bit more commentary on G&A reductions in conjunction with Slide #9. In 2022, we made significant progress reducing our G&A expenses, both by reducing management compensation and by focusing on greater efficiency with our employees. Excluding the onetime $2.2 million compensation adjustment, we finished 2022 at $20.3 million in G&A expense and we're targeting $19.2 million to $19.7 million for 2023. This focus on reducing cost, along with strong revenue growth, is anticipated to continue to lower our G&A costs as a percentage of revenue in 2023 and in future years.

結合幻燈片 #9 對 G&A 減少的更多評論。 2022 年，我們在減少管理人員薪酬和提高員工效率方面取得了重大進展，從而減少了 G&A 費用。不包括一次性 220 萬美元的薪酬調整，我們到 2022 年的 G&A 費用為 2030 萬美元，我們的目標是 2023 年達到 1920 萬至 1970 萬美元。這種對降低成本的關注以及強勁的收入增長預計將繼續降低我們的 G&A成本佔 2023 年及未來幾年收入的百分比。

Let me wrap up by saying we believe the scale of the changes we've made over the last year are apparent and convey that we truly appreciate our investors and intend to remain committed to maximizing shareholder value. And with that, we'll take analysts and investor questions.

最後，我要說的是，我們相信我們在過去一年中所做的改變的規模是顯而易見的，並表示我們真正感謝我們的投資者，並打算繼續致力於實現股東價值最大化。有了這個，我們將回答分析師和投資者的問題。

(Operator Instructions) Our first question comes from the line of Mitch Germain with JMP Securities.

（操作員說明）我們的第一個問題來自 JMP Securities 的 Mitch Germain。

Congratulations, everyone, on the great year.

恭喜大家，度過了美好的一年。

Thanks, Mitch.

謝謝，米奇。

Curious about leverage reduction that you've got baked into your outlook. Is there asset sales that you are contemplating, additional asset sales? Or is that just cash flow from operations and active sales could be a further -- can create a further decline in leverage?

對您已經融入前景的槓桿減少感到好奇。您是否正在考慮出售資產，額外的資產出售？或者僅僅是來自運營和積極銷售的現金流可能會進一步——可以進一步降低杠桿率？

Mitch, it's Scott. I think for 2023, we plan to recycle a little bit of capital. And the rest of the leverage reduction is going to come from improved earnings and some amount of operating cash flow that we would use to reduce debt along the way during the year.

米奇，是斯科特。我認為到 2023 年，我們計劃回收一點資本。其餘的槓桿減少將來自收益的改善和我們將在這一年中用來減少債務的一定數量的經營現金流。

It's largely -- and maybe honestly -- maybe I'll make sure, it's kind of largely driven by continuing to grow EBITDA. I think the like we did this year, I think we're very pleased that we were able to organically improve our balance sheet metric by over one point through organic growth, and that's what we expect to do next year as well.

這在很大程度上——也許老實說——也許我會確保，這在很大程度上是由持續增長的 EBITDA 驅動的。我認為就像我們今年所做的那樣，我認為我們很高興我們能夠通過有機增長將我們的資產負債表指標有機地改善一個百分點以上，這也是我們明年期望做的事情。

Got you. Do you -- is the strategy still to match any potential acquisitions with dispositions and continue to recycle? Is that the way that you're contemplating your capital plan?

明白了你 - 是否仍然將任何潛在收購與處置相匹配並繼續回收的戰略？這是您考慮資本計劃的方式嗎？

Yes, Mitch. It's Dave. Obviously, the transaction market today is difficult. As you hear from us and others, not a lot of activity out there. We're continuing to be very patient and disciplined on the acquisition side. And then really from a recycling perspective, I think just like anyone would do with the portfolio of assets or properties, we're continuing to look at our properties, look for those where we feel like we've extracted the value and potentially recycle those.

是的，米奇。是戴夫。顯然，今天的交易市場是艱難的。正如您從我們和其他人那裡聽到的那樣，那裡的活動並不多。我們在收購方面將繼續保持耐心和紀律。然後真的從回收的角度來看，我認為就像任何人對資產或財產組合所做的一樣，我們將繼續研究我們的財產，尋找我們認為我們已經提取價值並可能回收這些財產的財產.

So right now, in our modeling for 2023, we have not included any growth in acquisitions. We've included some recycling. But we'll do what we -- consistent with what we did this year. Really pleased with our recycling efforts in '22, which were selling 6 properties at about a 5, 6 cap and then buying a couple of properties at an aggregate 7 cap with a lot more upside.

所以現在，在我們 2023 年的模型中，我們沒有包括任何收購增長。我們已經包括了一些回收。但我們會做我們 - 與我們今年所做的一致。對我們在 22 年的回收工作感到非常滿意，我們以大約 5、6 的上限出售了 6 處房產，然後以總計 7 的上限購買了幾處房產，還有更多的上漲空間。

Got you. I think last one from me. Bad debt. Obviously, you're baking into guidance a little bit of an increase. And I'm curious, has there been any changes to your watch list? Or is that just to create some conservatism given the potential for some macro and economic headwinds in the year?

明白了我想最後一個來自我。呆帳。顯然，您正在為指導增加一點點。我很好奇，您的監視列表是否有任何變化？還是考慮到今年可能出現一些宏觀和經濟逆風，這只是為了營造一些保守主義？

Well, we forecasted 0.75% to 1.5% of bad debt. And I believe we ended '22 at about 0.82% or 0.83%. So towards the low end of the range this year, and we really haven't seen any backwards progress in our collections today. So it's a range. And the top end of that range is closer to where we've been historically, the bottom end is where we've been in '22, and we haven't really seen any downward pressure on collections or upward pressure on bad debt yet.

好吧，我們預測壞賬為 0.75% 至 1.5%。而且我相信我們在 22 年末的增長率約為 0.82% 或 0.83%。因此，今年接近該範圍的低端，我們今天的系列確實沒有看到任何倒退的進展。所以這是一個範圍。該範圍的頂端更接近我們歷史上的水平，底端是我們在 22 年的水平，我們還沒有真正看到任何收款的下行壓力或壞賬的上行壓力。

Our next question comes from the line of Gaurav Mehta with EF Hutton.

我們的下一個問題來自 Gaurav Mehta 與 EF Hutton 的對話。

First question, I was hoping if you could provide some color on what you're expecting for your Pillarstone assets in '23?

第一個問題，我希望你能提供一些關於你對 23 年 Pillarstone 資產的期望的顏色嗎？

Gaurav, it's Dave. Thanks for your question. So we have expressed that it's our desire to monetize our interest in Pillarstone. Largely, that is an effort that's being advanced through legal activities currently. So there's not a whole lot I can say other than we're continuing to believe that it's the best thing for Whitestone shareholders to monetize our investment and we're working to do so. We obviously provide an update on those legal activities in our public filings.

高拉夫，是戴夫。謝謝你的問題。所以我們已經表達了我們希望將我們對 Pillarstone 的興趣貨幣化。在很大程度上，這是目前正在通過法律活動推進的一項努力。因此，除了我們繼續相信將我們的投資貨幣化對白石股東來說是最好的事情並且我們正在努力這樣做之外，我能說的不多。我們顯然在我們的公開文件中提供了這些法律活動的最新信息。

Okay. Second question on your '23 guidance. What kind of leasing spreads are you underwriting in the guidance?

好的。關於你的 23 年指南的第二個問題。您在指南中承保了什麼樣的租賃利差？

We expect to see leasing -- strong leasing spreads for the balance of '23, similar to what we've seen towards the third and fourth quarters of '22. The leases that are expiring in '23 would still be towards the lower end of the leasing pricing before we've seen inflation. And I don't know, Christine, if you want to add any color there?

我們預計會看到租賃——23 年餘下時間的租賃利差強勁，類似於我們在 22 年第三和第四季度看到的情況。在我們看到通貨膨脹之前，23 年到期的租約仍將接近租賃價格的低端。我不知道，克里斯汀，你是否想在那裡添加任何顏色？

We continue to see the same improved leasing spreads over -- that we've had in the last year and continuing. We haven't see much slowdown in leasing yet. It's just moderated a little bit through the first quarter. In addition to that, we're also focusing on remerchandising as well for our centers. So we have an asset plan for each center, where we look over the next 3 years and how we best remerchandise those for an increase in traffic and premium and rents.

我們繼續看到同樣改善的租賃利差——我們在去年和繼續。我們還沒有看到租賃有太大放緩。它只是在第一季度有所緩和。除此之外，我們還專注於為我們的中心進行再銷售。因此，我們為每個中心製定了資產計劃，我們著眼於未來 3 年，以及我們如何最好地重新銷售這些中心以增加流量、溢價和租金。

(Operator Instructions) Our next question comes from the line of Craig Kucera with B. Riley Securities.

（操作員說明）我們的下一個問題來自 B. Riley Securities 的 Craig Kucera。

Does your investment-grade rating help at all in pricing on your line of credit?

您的投資級評級對您的信用額度定價有幫助嗎？

The investment from Kroll that there's not a break in pricing from the investment grade rating we received from Kroll. However, we do anticipate that it's going to improve our access to the debt markets going forward and improve any pricing we may have. And as we continue to improve our earnings, we may be able to achieve pricing reduction going forward in our line of credit.

Kroll 的投資表明，我們從 Kroll 獲得的投資等級評級沒有中斷定價。但是，我們確實預計它將改善我們未來進入債務市場的渠道，並改善我們可能擁有的任何定價。隨著我們繼續提高我們的收入，我們可能能夠在我們的信貸額度中實現降價。

Yes, I might just add to that. I mean just if you step back and look at the high level. Obviously, we've made a ton of progress with the company this year in improving the overall profile. Results are strong. The balance sheet has strengthened. So all of those activities were reflected in our recast and the progress it made was an important part of us getting that done. Really proud of Scott and the team for getting that done in late '22, which is very important. If you look at us going forward, we have a little -- maybe a little bit higher variable portion of our debt than some others. But really no maturities, no debt maturities from -- until '27, '28 of any significance. So I think the progress we've made, the receiving of the investment-grade credit rating, all position us to going forward in a much better position.

是的，我可能會補充一點。我的意思是，只要你退後一步，看看高層。顯然，今年我們在改善整體形象方面與公司取得了很大進展。結果很強。資產負債表得到加強。因此，所有這些活動都反映在我們的重鑄中，它取得的進展是我們完成這項工作的重要組成部分。真的為斯科特和團隊在 22 世紀末完成這項工作感到自豪，這非常重要。如果你看看我們未來的發展，我們的債務可變部分可能比其他一些高一點。但實際上沒有到期日，沒有任何意義的債務到期日——直到 27 年、28 年。所以我認為我們取得的進展，獲得投資級信用評級，都使我們能夠在更好的位置上前進。

Got it. And are you planning on going down the path with any other rating agencies to maybe see some better pricing, if possible?

知道了。如果可能的話，您是否打算與任何其他評級機構一起走下去，以便可能看到更好的定價？

We don't have any immediate plans for that. But as we move forward, we may consider it.

我們沒有任何立即的計劃。但隨著我們前進，我們可能會考慮它。

Okay. Great. I just want to talk about your operating expenses. I want to say the first 3 quarters of last year, they were up at a pretty healthy clip, relatively flat this quarter, so a nice improvement in NOI margin. Did you roll out any new programs? Or can you just give us some color on how you were able to keep those a little bit in line and kind of your expectations for '23?

好的。偉大的。我只想談談你的運營費用。我想說的是，去年前三個季度，它們的增長非常健康，本季度相對平穩，因此 NOI 利潤率有了很好的改善。你有推出任何新計劃嗎？或者你能給我們一些顏色，說明你是如何讓這些保持一致的，以及你對 23 年的期望嗎？

Maybe, Christine, I can start out, but maybe Scott will jump in as well. But I do think one of the things we've done as a company is implement significant discipline, accountability, clarity of objectives. And so one of the things we've done is when working with the properties, Christine has been great with leading the team. And then I'll maybe let Christine and Scott talk to some of the things we've done in this area.

也許，克里斯汀，我可以開始，但也許斯科特也會加入。但我確實認為，作為一家公司，我們所做的其中一件事就是實施嚴格的紀律、問責制和明確的目標。因此，我們所做的其中一件事就是在處理這些資產時，克里斯汀在領導團隊方面表現出色。然後我可能會讓克里斯汀和斯科特談談我們在這個領域所做的一些事情。

And Craig, this is Scott. In the third quarter, there is timing involved with property expenses. Sometimes you have repairs schedule -- more repairs scheduled in the quarter, they may have in another quarter. So I think about it more in the annual context than in a quarterly context.

克雷格，這是斯科特。第三季度，涉及財產支出的時機。有時你有維修計劃——更多的維修計劃在一個季度進行，他們可能在另一個季度進行。所以我更多地在年度背景下而不是在季度背景下考慮它。

And with that, we're really focused on planning. And so each property is part of the study of what we need to do. Going forward is with a capital plan over a 3- to 5-year period, we haven't done that in the past. So that's part of what we've implemented this past year. In addition, it helps smooth operations quite a bit. And we've also really streamlined the team and reduced headcount over the year too. That's made a big difference. And so last year was about alignment. This year is about accountability. And next year, we look for the awards with that.

因此，我們真正專注於規劃。因此，每個屬性都是我們需要做的研究的一部分。未來是一個 3 到 5 年的資本計劃，我們過去沒有這樣做過。所以這是我們去年實施的部分內容。此外，它還有助於平穩操作。我們也真正精簡了團隊，並在一年中減少了員工人數。這有很大的不同。所以去年是關於調整的。今年是問責制。明年，我們將以此來尋找獎項。

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

我們的下一個問題來自 Mitch Germain 與 JMP Securities 的對話。

You there Mitch?

你在米奇嗎？

Sorry about that. I know you guys have a bunch of pad sites and redevelopment opportunities. I'm curious if there's any decision or progress to begin working or monetizing some of that?

對於那個很抱歉。我知道你們有很多墊地和重建機會。我很好奇是否有任何決定或進展開始工作或將其中的一些貨幣化？

Yes. I'm going to start and then probably let Christine maybe give more info. But we do still have a ton of opportunity in the portfolio from extracting some of the excess land and turning that into pad sites. I think historically, we probably had a slide in our deck that we didn't include this quarter just because we're excited to kind of provide information as it happens. And so there was nothing -- no significant progress there, but we still see great opportunity. And I'll let maybe Christine, if she wants to add more color. But there are between pad sites and other developments, there is opportunity to build those at very attractive returns.

是的。我要開始了，然後可能讓 Christine 提供更多信息。但我們在投資組合中仍然有大量機會，可以提取一些多餘的土地並將其變成墊地。我認為從歷史上看，我們可能在我們的甲板上有一張幻燈片，我們本季度沒有包括在內，只是因為我們很高興能夠在發生時提供信息。所以沒有什麼——那裡沒有重大進展，但我們仍然看到了巨大的機會。如果她想添加更多顏色，我可能會讓克里斯汀。但在墊地和其他開發項目之間，有機會以非常有吸引力的回報建造這些項目。

Yes, Mitch. What we had last year is a little bit longer lead time on some of the planning that has to do a lot with the municipalities that we've worked with. Some of the COVID effects that they were backed up quite a bit. But we continue on the of all of our pad sites that we have. So we keep -- we'll keep delivering a number of those each year. And on both projects, the much larger projects we're making we're making headway on those as well. We'll be giving more detail as we -- more detail to come.

是的，米奇。我們去年的一些計劃的準備時間稍長一些，這些計劃與我們合作過的市政當局有很大關係。他們得到了相當多的支持的一些 COVID 影響。但是我們繼續我們擁有的所有墊站點。所以我們保持——我們每年都會繼續交付一些這樣的產品。在這兩個項目上，我們正在進行的更大的項目也在這些項目上取得了進展。我們將提供更多細節——更多細節即將到來。

Ladies and gentlemen, that concludes our question-and-answer session. I'll turn the floor back to Mr. Holeman for any final comments.

女士們，先生們，我們的問答環節到此結束。最後請 Holeman 先生髮言。

Thanks, everyone. We are very energized by our progress we've made in '22. And and look forward to carrying that into 2023. Thanks for joining us today, and we look forward to updating you shortly on our '23 progress. Have a great day.

感謝大家。我們對 22 年取得的進展感到非常興奮。並期待將其延續到 2023 年。感謝您今天加入我們，我們期待盡快向您介紹我們的 23 年進展情況。祝你有美好的一天。

Thank you. This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.

謝謝。今天的會議到此結束。此時您可以斷開線路。感謝您的參與。