Whitestone REIT (WSR) 2023 Q4 法說會逐字稿

Greetings, and welcome to the Whitestone REIT fourth-quarter 2023 earnings call. (Operator Instructions) As a reminder, this conference is being recorded.

您好，歡迎參加 Whitestone REIT 2023 年第四季財報電話會議。（操作員指示）謹此提醒，本次會議正在錄製中。

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.

現在我想將會議交給東道主，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 2023 earnings conference call. On today's call are Dave Holeman, Chief Executive Officer; Christine Mastandrea, Chief Operating Officer; and Scott Hogan, Chief Financial Officer.

早安，感謝您參加 Whitestone REIT 的 2023 年第四季財報電話會議。出席今天電話會議的有執行長戴夫‧霍爾曼 (Dave Holeman)；克里斯蒂娜·馬斯坦德里亞，營運長；和首席財務官斯科特霍根。

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，本次電話會議中所做的一些陳述並非歷史性的，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聲明有重大差異。請參閱該公司的收益新聞稿和向 SEC 提交的文件，包括 Whitestone 最新的 10-Q 和 10-K 表格，以了解這些因素的詳細討論。

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 7, 2024. The company undertakes no obligation to update this information.

我們承認本次電話會議可能會在一段時間內進行網路直播，但還需要注意的是，本次電話會議包含的時間敏感資訊可能僅截至今天（2024 年 3 月 7 日）才準確。本公司不承擔更新該資訊的義務。

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. We published fourth-quarter 2023 earnings slides on our website yesterday afternoon, which highlight topics to be discussed today.

Whitestone 的第四季度收益新聞稿以及補充營運和財務資料包已向 SEC 備案，並可在我們網站的投資者關係部分取得。昨天下午，我們在網站上發布了 2023 年第四季度收益幻燈片，其中重點介紹了今天要討論的主題。

I will now turn the call over to Dave Holeman, our Chief Executive Officer.

我現在將把電話轉給我們的執行長戴夫霍爾曼 (Dave Holeman)。

Thank you, David, and good morning, everyone. Welcome to our fourth-quarter 2023 earnings conference call. I'll break my comments into three parts: first, what we've done; second, ongoing initiatives that continue to drive value; and finally, how our core strategy thinks very well with the current environment. I'll get straight into it.

謝謝大衛，大家早安。歡迎參加我們的 2023 年第四季財報電話會議。我將把我的評論分為三個部分：第一，我們做了什麼；其次，持續推動價值的舉措；最後，我們的核心策略如何很好地適應當前環境。我會直接進入它。

In terms of what we've done, this management team began in January of 2022, so we're two years into our run. Here's a high-level list of our accomplishments.

就我們所做的事情而言，這個管理團隊在 2022 年 1 月開始組建，所以我們的營運已經兩年了。這是我們成就的高級清單。

Core FFO per share has grown from $0.86 in 2021 to $0.91 for 2023. This is despite higher interest costs, primarily as we renewed and extended our credit facility in the third quarter of 2022. With that in place until 2027, we anticipate a higher earnings trajectory ahead of us. I’ll have Scott cover our projections in greater detail.

每股核心 FFO 已從 2021 年的 0.86 美元成長到 2023 年的 0.91 美元。儘管利息成本較高，主要是因為我們在 2022 年第三季更新並延長了信貸安排。到 2027 年為止，我們預計我們將實現更高的獲利軌跡。我將讓斯科特更詳細地介紹我們的預測。

We've rapidly improved our balance sheet metrics, bringing our debt to EBITDAre down from 9.2 times for the fourth quarter of 2021 to 7.5 times for the fourth quarter of 2023. This is despite significant litigation expense impacting our numbers.

我們迅速改善了資產負債表指標，將債務與 EBITDA 的比率從 2021 年第四季的 9.2 倍降至 2023 年第四季的 7.5 倍。儘管大量的訴訟費用影響了我們的數字。

We've focused and prioritized our disciplined leasing efforts on high quality tenants, resulting in record occupancy in our portfolio, up 290 basis points from 91.3% at year-end 2021, to 94.2% at year-end 2023. Breaking this down further, we've grown our small-space occupancy by 320 basis points to 92.1%, and our larger space occupancy has grown by 200 basis points to 97.5%.

我們將嚴格的租賃工作重點放在高品質租戶上，並優先考慮，導致我們的投資組合入住率創歷史新高，從 2021 年底的 91.3% 上升 290 個基點，達到 2023 年底的 94.2%。進一步細分，我們的小空間佔用率成長了 320 個基點，達到 92.1%，大空間佔用率成長了 200 個基點，達到 97.5%。

We had same-store net operating income growth of 7.9% in 2022, followed by 2.7% in 2023. Scott and Christine will provide more detail on this important metric later in the call.

2022 年我們的同店淨營業收入成長 7.9%，2023 年成長 2.7%。斯科特和克里斯汀將在稍後的電話會議中提供有關此重要指標的更多詳細資訊。

We've strengthened our Board, bringing on three new Board members or half of our six-person Board of trustees. This refreshment has been accompanied by a host of shareholder-friendly actions, including right-sizing our executive compensation, splitting the role of chair and CEO, and providing shareholders with access to bylaws. We've worked hard to successfully conclude the litigation with our former CEO and exit our investment in his related party joint venture.

我們加強了董事會的實力，聘請了三名新的董事會成員或六人董事會的一半成員。此次更新也伴隨著一系列有利於股東的行動，包括調整高階主管薪酬、劃分董事長和執行長的角色，以及為股東提供查閱章程的機會。我們經過努力，成功結束了與前任執行長的訴訟，並退出了對他的關聯方合資企業的投資。

We are nearing conclusion. Whitestone has a very clear strategy and path to value creation that continues to be more clear as this noise is removed.

我們即將得出結論。白石擁有非常清晰的戰略和價值創造路徑，隨著噪音的消除，這條策略和路徑將變得更加清晰。

And finally, culture. We've simultaneously brought on very talented individuals, reduced our headcount, and improved employee satisfaction. In short, we're improving G&A while achieving better results. I'm super proud of the team and their long list of accomplishments over the last two years, only a few of which I have highlighted.

最後是文化。我們同時引進了非常有才華的人才，減少了員工人數，並提高了員工滿意度。簡而言之，我們正在改善一般管理費用，同時取得更好的成果。我對這個團隊以及他們過去兩年取得的一長串成就感到非常自豪，我只強調了其中的一小部分。

I'm equally excited about how we're continuing to drive value. Three initiatives are at the heart of our creating value, our quality of revenue initiative, our balance sheet improvement plan, and our capital recycling plan. I'll have Christine cover the quality of revenue initiative, and I'll provide a bit of color on the other two.

我對我們如何繼續推動價值同樣感到興奮。三項措施是我們創造價值的核心：收入品質措施、資產負債表改善計畫和資本回收計畫。我將讓 Christine 介紹收入計劃的質量，並為另外兩項提供一些說明。

We've had significant progress with our balance sheet improvement plan over the last two years, obtaining an investment-grade credit rating. We have more work to do here and have the right people, the right plan, and the market tailwinds supporting our efforts.

過去兩年，我們的資產負債表改善計畫取得了重大進展，獲得了投資等級信用評級。我們在這裡還有更多的工作要做，並擁有合適的人員、正確的計劃以及支持我們努力的市場順風。

Our debt metrics will continue to improve as we grow EBITDAre, apply free cash flow to reduce debt, monetize our Pillarstone investment, and activate the land parcel and pad site development opportunities within the portfolio. We expect debt to EBITDAre below 7 times by year-end 2024, and we anticipate further improvement in 2025.

隨著 EBITDA 的成長、運用自由現金流來減少債務、將我們的 Pillarstone 投資貨幣化以及激活投資組合中的地塊和基地開發機會，我們的債務指標將繼續改善。我們預計到 2024 年底，債務與 EBITDA 比率將低於 7 倍，並預計 2025 年將進一步改善。

Our asset recycling program has allowed us to upgrade the overall quality of our portfolio, selling properties with lower upside and ABR and redeploying the proceeds into acquisitions with significantly higher upside, higher ABR, and characteristics that capture more of the key demand drivers in today's market. We anticipate that since October of 2022, we will have completed approximately $80 million in asset sales by the end of the second quarter at an aggregate cap rate of 6.2%.

我們的資產回收計劃使我們能夠提升投資組合的整體質量，出售具有較低上漲空間和ABR 的房產，並將收益重新部署到具有明顯較高上漲空間、較高ABR 和捕獲當今市場更多關鍵需求驅動因素的特徵的收購中。 。我們預計，自 2022 年 10 月起，到第二季末，我們將完成約 8,000 萬美元的資產出售，總上限率為 6.2%。

I say anticipate because we have a sale upcoming but not yet announced. And we believe we'll keep the effort going at about the same pace we've had over the last two years.

我說預計是因為我們即將進行促銷但尚未宣布。我們相信，我們將繼續以與過去兩年相同的速度努力。

I think it's important to note here that we are very capable of driving results via organic growth. So we're not reliant on the transaction market or the equity market cooperating in order to drive earnings growth. However, we are starting to see valuations adjust slightly to the higher interest rate environment, and our team is ready to take advantage of those opportunities that align with our strategy.

我認為這裡值得注意的是，我們非常有能力透過有機成長來推動績效。因此，我們不依賴交易市場或股票市場的合作來推動獲利成長。然而，我們開始看到估值因較高的利率環境而略有調整，我們的團隊已準備好利用這些符合我們策略的機會。

The final area I would like to cover today is what we're seeing in terms of the current environment. Frankly, this is a great environment for most of the retail REITs, as limited supply of retail centers is driving good results across the peer group. The limited supply, combined with country-leading job and population growth in our markets and Whitestone's ownership of the right type of retail centers, makes this current dynamic especially powerful for Whitestone.

我今天想討論的最後一個領域是我們在當前環境方面所看到的情況。坦白說，對於大多數零售房地產投資信託基金來說，這是一個很好的環境，因為零售中心的有限供應正在推動整個同行取得良好的表現。有限的供應，加上我們市場上全國領先的就業和人口增長，以及白石擁有合適類型的零售中心，使得當前的動態對白石來說尤其強大。

Our strategy and our assets are very well matched to take advantage of this environment, and we've made a number of strategic decisions that are producing great outcomes. Specifically, we have shorter leases with annual rent bumps, the ability to capture mark-to-market rents quicker, a high-quality diversified tenant roster, and limited CapEx needs as compared to other peers.

我們的策略和我們的資產非常匹配，可以充分利用這種環境，我們做出了許多策略決策，這些決策正在產生巨大的成果。具體來說，與其他同業相比，我們的租賃期較短且年租金上漲，能夠更快地獲取按市值計價的租金，高品質的多元化租戶名單以及有限的資本支出需求。

This strategic decision to operate with shorter leases and be more active owners is fundamental to what we do. Because of the confidence we have in our team to populate centers with fast-growing tenants, we are better positioned to share in their success.

這種以更短的租約運作並成為更積極的所有者的策略決策是我們所做工作的基礎。由於我們對我們的團隊充滿信心，能夠為中心帶來快速成長的租戶，因此我們更有能力分享他們的成功。

We are 100% Sunbelt-focused in business-friendly states. Migration trends in our markets lead the country and are acting as a strong tailwind not only in terms of our operating results, but for the underlying value of our centers.

我們 100% 專注於商業友善州的陽光地帶。我們市場的移民趨勢引領全國，不僅對我們的經營業績，而且對我們中心的潛在價值而言，都發揮著強大的推動作用。

Lastly, our centers have a much larger percentage of small spaces than most of our peers. We and others continue to see strong demand from businesses seeking out spaces in the 1,500 to 3,000-square-foot range. We've intentionally acquired centers and made modifications to meet this demand, and we believe this trend will continue as businesses adjust to properly meet the needs of the surrounding communities.

最後，我們的中心的小空間比例比大多數同行高得多。我們和其他人繼續看到企業尋求 1,500 至 3,000 平方英尺範圍內的空間的強勁需求。我們有意收購了中心並進行了改造以滿足這一需求，我們相信隨著企業進行調整以適當滿足週邊社區的需求，這種趨勢將繼續下去。

We introduced 2024 core FFO per share guidance yesterday of $0.98 to $1.04. We have a few more near-term unknowns than I'd like, but I've never been more bullish about the fundamentals driving our business and the strategy we have in place.

我們昨天推出了 2024 年核心 FFO 每股指引，為 0.98 美元至 1.04 美元。我們的近期未知數比我想像的要多，但我對推動我們業務的基本面和我們制定的策略從未如此樂觀。

I'll have Scott walk everyone through our 2024 projections and the assumed variables. Once again, let me say I'm very proud of the team here and everything we've accomplished. And I'll now turn the call over to Christine.

我將請 Scott 向大家介紹我們對 2024 年的預測和假設的變數。讓我再說一遍，我為這裡的團隊以及我們所取得的一切感到非常自豪。我現在將把電話轉給克里斯汀。

Thank you, Dave. We've had a real strong quarter in operations. Occupancy rose to 94.2%, up 50 basis points from last year's record finish. Occupancy may dip a bit for the upcoming quarter as it did for the first quarter of 2023. This is because we closed a large number of deals in the fourth quarter, and we intentionally are re-merchandising in the first quarter for revenue quality.

謝謝你，戴夫。我們的季度營運表現非常強勁。入住率升至 94.2%，比去年創紀錄的高出 50 個基點。下一季的入住率可能會像 2023 年第一季一樣略有下降。這是因為我們在第四季度完成了大量交易，我們有意在第一季進行重新銷售以提高收入品質。

However, while we may see a first quarter dip, we have a strong pipeline of deals, and we're forecasting an occupancy of 93.8% to 94.8% by year-end 2024. Occupancy for 10,000-square-foot-plus spaces came in at 97.5%, with our higher ABR small spaces coming in at 92.1%.

然而，雖然我們可能會看到第一季出現下滑，但我們有大量的交易，我們預計到 2024 年底入住率將達到 93.8% 至 94.8%。10,000 平方英尺以上空間的入住率為 97.5%，ABR 較高的小型空間的入住率為 92.1%。

Straight-line leasing spreads were 21.8% for the quarter, with 37.3% on new leases and 15.3% on renewals. For the last 12 months, combined straight line leasing spreads were 21.7%. Frankly, as strong as our leasing spreads are, it keeps getting better if you dig into the numbers.

本季直線租賃利差為 21.8%，其中新租為 37.3%，續租為 15.3%。過去 12 個月，合併直線租賃利差為 21.7%。坦白說，儘管我們的租賃利差很大，但如果你深入研究數字，它會變得越來越好。

Just recently, Marcus & Millichap showed asking rents in Phoenix, our largest market, jumping 12.6% between 2022 and 2023. Not only did we capture those jumps more quickly because of our shorter-term leases averaging four years, but the recency of the jump bodes well for our leasing spreads in 2024, 2025, and 2026. This isn't just a number on a spreadsheet; it matches what our leasing agents are seeing in the ground.

就在最近，Marcus & Millichap 顯示我們最大的市場鳳凰城的租金要價在 2022 年至 2023 年間躍升了 12.6%。我們不僅因為平均四年的短期租賃而更快地實現了這些跳躍，而且最近的跳躍對於我們 2024 年、2025 年和 2026 年的租賃利差來說是個好兆頭。這不僅僅是電子表格上的數字；它與我們的租賃代理商在地面上看到的情況相符。

Migration trends, Phoenix manufacturing boom, consumer trends, and a shortage of retail neighborhood centers are all combining to make this one of the strongest environments we've ever seen. Some of our peers have recently been talking about the value of vacancy and that vacancy allows them to better align a center to the surrounding demographic, often a new younger demographic, rather than letting a center get out of touch.

移民趨勢、鳳凰城製造業繁榮、消費趨勢以及零售鄰里中心的短缺，這些因素綜合在一起，使這裡成為我們所見過的最強大的環境之一。我們的一些同行最近一直在談論空缺的價值，空缺使他們能夠更好地將中心與周圍的人群（通常是新的年輕人群）結合起來，而不是讓中心失去聯繫。

However, as you can see from the fact we just hit the record occupancy, vacancy at our centers is limited. This leads us to our quality of revenue initiative. We strongly believe that upgrading our tenants during the good time creates long-term shareholder value as we drive traffic with fast-growing businesses and further improving collection rates and lowering our intended and unintentional turnover.

然而，正如您從我們剛剛創下的入住率記錄中看到的那樣，我們中心的空置率是有限的。這引導我們採取收入品質計劃。我們堅信，在繁榮時期升級我們的租戶可以創造長期股東價值，因為我們可以透過快速成長的業務來推動流量，並進一步提高收款率並降低我們有意和無意的營業額。

We often compare what we do to gardening in that intentional pruning is key to make sure that you have high-quality tenants primed for growth. Oftentimes, we're swapping in a business with higher long-term growth potential and the ability to drive center traffic. It's necessary because over 60% of our centers are at the 95% or greater occupancy.

我們經常將我們所做的事情與園藝進行比較，因為有意識的修剪是確保您擁有準備成長的高品質租戶的關鍵。通常，我們會更換具有更高長期成長潛力和推動中心客流量的業務。這是必要的，因為我們超過 60% 的中心的入住率達到了 95% 或更高。

Given our average lease length, I like to think of this initiative as halfway through from when the management team stepped in. By 2026, we will have intensely reviewed the large majority of our tenants. We're confident investors will benefit from these efforts as we set this up for a long-term, robust same-store NOI growth.

考慮到我們的平均租賃期限，我認為這項措施是從管理團隊介入開始的一半。到 2026 年，我們將對絕大多數租戶進行嚴格審查。我們相信投資者將從這些努力中受益，因為我們為長期、強勁的同店 NOI 成長做好了準備。

Despite our great success in smaller spaces, we've had a number of positive things going on in the larger spaces, too. Our former Bed, Bath & Beyond space is being transformed into a high-demand pickleball and entertainment venue. Our new tenant, Pickler, is an extremely strong operator, and we've recently signed a long-term contract with them at El Dorado, our Trader Joe-anchored Center in Dallas.

儘管我們在較小的空間中取得了巨大的成功，但我們在較大的空間中也發生了許多積極的事情。我們以前的 Bed、Bath & Beyond 空間正在改造成高需求的泡菜球和娛樂場所。我們的新租戶 Pickler 是一家非常強大的營運商，我們最近在我們位於達拉斯的 Trader Joe 駐地中心 El Dorado 與他們簽訂了一份長期合約。

In the locations they've opened so far, Pickler has enjoyed a strong first-mover advantage, and they've shown themselves to be adept at going after a younger demographic. Our EoS buildout at Williams Trace is taking longer than anticipated, pushing back the commencement date.

在迄今為止開設的門市中，Pickler 享有強大的先發優勢，並且他們已經證明自己善於吸引年輕人群。我們在 Williams Trace 的 EoS 建設花費的時間比預期的要長，從而推遲了啟動日期。

While this impacted our same-store NOI growth in 2023, it will have some impact on 2024. But I want to remind everybody it's a great replacement of an underperforming grocer and triples our revenue for 51,000 square feet of space. This change is anticipated to drive strong center traffic for years to come.

雖然這影響了我們 2023 年同店的 NOI 成長，但也會對 2024 年產生一些影響。但我想提醒大家，它是一家業績不佳的雜貨店的絕佳替代品，並且可以使我們 51,000 平方英尺空間的收入增加兩倍。預計這一變化將在未來幾年推動中心交通的強勁發展。

Many of the businesses that are cycling out right now are those challenged by the higher capital costs in the current environment. The businesses moving in are adjusted to the higher capital cost. However, this has been a limited number of businesses in our portfolio, as the margin of the bulk of our tenants are low inventory and low capital businesses serving the communities that we have.

目前退出的許多企業都是在當前環境下受到較高資本成本挑戰的企業。遷入的企業會根據較高的資本成本進行調整。然而，我們投資組合中的業務數量有限，因為我們大部分租戶的利潤都是低庫存和低資本業務，為我們擁有的社區提供服務。

I'd add one comment to Dave's regarding our capital-recycling initiative. With the sale of Spoerlien in Chicago, we've exited our one property that didn't fit our geographic profile. At this time, we only have one property that doesn't fit our strategic profile, that is owning services that serve the nearby community.

我想在戴夫關於我們的資本回收計劃的評論中添加一條評論。隨著芝加哥 Spoerlien 的出售，我們退出了一處不符合我們地理特徵的房產。目前，我們只有一處房產不符合我們的策略定位，那就是擁有為附近社區服務的服務。

That property is our headquarters office building, Woodlake. We'll take a hard look at exiting Woodlake this year. We strongly believe in having a very focused strategy of sticking to our expertise.

該物業是我們的總部辦公大樓，伍德萊克。今年我們將認真考慮退出伍德萊克。我們堅信有一個非常專注的策略來堅持我們的專業知識。

I often comment on categories of tenants that are showing strength during the quarter. However, almost every category of tenant type is performing well right now. From restaurants, health, beauty, education, fitness, and financial and other service-oriented businesses, we are seeing growth.

我經常評論本季表現強勁的租戶類別。然而，目前幾乎所有類別的租戶類型都表現良好。從餐飲、健康、美容、教育、健身、金融等服務型產業，我們都看到了成長。

I'm eager to drive results and see what leasing team can accomplish in 2024. And I'm eager to report those results as the year progresses.

我渴望取得成果，看看租賃團隊在 2024 年能取得什麼成就。隨著時間的推移，我渴望報告這些結果。

And with that, we'll have Scott cover the financials.

至此，我們將讓史考特負責財務事宜。

Thank you, Christine. We delivered $0.24 in core FFO per share for the fourth quarter of 2023 versus $0.23 in the fourth quarter of 2022, and $0.91 for the full year 2023 versus $1.03 for the full year 2022. Now, I'll walk you through the 2022 to 2023 core FFO per share earnings variance, and you may want to follow along on slide 11.

謝謝你，克里斯汀。我們在 2023 年第四季交付的核心 FFO 每股為 0.24 美元，而 2022 年第四季為 0.23 美元；2023 年全年為 0.91 美元，而 2022 年全年為 1.03 美元。現在，我將帶您了解 2022 年至 2023 年核心 FFO 每股收益差異，您可能需要按照幻燈片 11 進行操作。

Same-store NOI growth was our key positive driver, as it should be every year, adding $0.05. G&A drove a $0.05 reduction in FFO core per share, including $0.04 of benefit in the first quarter of 2022 associated with a forfeiture of outstanding restricted share from our former CEO and other employees that was not repeated in 2023. While G&A normally reflects year-over-year increases in compensation expense, ours also contains litigation expense related to Pillarstone and our former CEO.

同店 NOI 成長是我們的主要正面推動力，每年都應該如此，增加 0.05 美元。 G&A 導致 FFO 核心每股減少 0.05 美元，其中包括 2022 年第一季因沒收我們前執行長和其他員工的已發行限制性股票而帶來的 0.04 美元收益，這一情況在 2023 年沒有重複。雖然一般管理費用通常反映了薪酬費用的逐年增長，但我們的費用也包含與 Pillarstone 和前執行長相關的訴訟費用。

Other items drove a $0.01 reduction, and interest expense drove an $0.11 reduction. As a reminder, we amended our credit facility in the third quarter of 2022. So the variance between the former and current credit facility primarily impacted the first three quarters of 2023.

其他項目導致減少 0.01 美元，利息支出導致減少 0.11 美元。謹此提醒，我們在 2022 年第三季修改了信貸安排。因此，先前和目前信貸安排之間的差異主要影響了 2023 年前三個季度。

As Dave mentioned, we introduced 2024 core FFO per share guidance yesterday with a range of $0.98 to $1.04. Let me walk you through the forecasted changes between the 2023 core FFO per share amount of $0.91 and the midpoint of the 2024 guidance of $1.01.

正如 Dave 所提到的，我們昨天推出了 2024 年核心 FFO 每股指引，區間為 0.98 美元至 1.04 美元。讓我向您介紹 2023 年每股核心 FFO 金額 0.91 美元與 2024 年指引中位數 1.01 美元之間的預測變化。

Same-store NOI is expected to improve $0.07 in 2024. G&A cost reductions should drive a $0.01 increase, primarily as our former CEO and Pillarstone-related litigation expense is expected to be significantly reduced.

預計 2024 年同店 NOI 將提高 0.07 美元。G&A 成本的降低應會帶來 0.01 美元的成長，主要是因為我們的前執行長和 Pillarstone 相關的訴訟費用預計將大幅減少。

Other items, primarily driven by non-same-store NOI and no longer reflecting earnings deficits from our equity method investment in Pillarstone following our OP unit redemption in January of 2024, are forecasted to add $0.03. Interest expense is forecasted to drive a $0.01 reduction in core FFO per share. We anticipate higher interest expense in the first part of the year, both because the shape of the SOFR curve and because we assume some paydown of debt with partial Pillarstone monetization in July.

其他項目主要由非同店 NOI 推動，並且不再反映我們在 2024 年 1 月贖回 OP 單位後對 Pillarstone 的權益法投資的盈利赤字，預計將增加 0.03 美元。預計利息支出將導致每股核心 FFO 減少 0.01 美元。我們預計今年上半年的利息支出會更高，這既是因為 SOFR 曲線的形狀，也是因為我們假設 7 月份部分 Pillarstone 貨幣化會償還部分債務。

Overall, if you divide our annual guidance into four quarters, I anticipate the first quarter will be a couple of cents under the average, primarily due to interest expense. And I anticipate the fourth quarter to be a couple cents over the average due to lower interest expense, percent sales clauses, and growth that's expected to occur over the course of the year.

總體而言，如果將我們的年度指導分為四個季度，我預計第一季將比平均水平低幾美分，這主要是由於利息支出。我預計第四季度的利潤將比平均水平高出幾美分，原因是利息支出下降、銷售條款百分比下降以及預計全年將出現增長。

In addition to the headline, let me cover a few other elements of our guidance. Same-store NOI is forecasted to be between 2.5% and 4%. The delay in EoS commencement as a reason the change is a little lower, but we are still expecting strong growth.

除了標題之外，讓我介紹一下我們指南的其他一些要素。同店 NOI 預計在 2.5% 至 4% 之間。EoS 啟動延遲是導致變化幅度較小的原因，但我們仍預期強勁成長。

Bad debt is expected to be between 0.6% and 1.1%. We improved bad debt by 18 basis points in 2023, bringing it down to 0.65%. Our quality of revenue initiative should help keep this number low.

壞帳預計在0.6%至1.1%之間。2023 年，我們將壞帳改善了 18 個基點，降至 0.65%。我們的收入品質計劃應該有助於將這個數字保持在較低水平。

Finally, our debt to EBITDAre metric is forecasted to improve to between 6.6 and 7 times by the fourth quarter of 2024, and that assumes we're not able to monetize the majority of our Pillarstone investment until 2025. We are very pleased to announce a 3% increase in our monthly dividend level. We believe dividends should grow with earnings, and we believe we'll have good earnings growth in 2024 and continuing in 2025 and beyond.

最後，到 2024 年第四季度，我們的債務與 EBITDAre 指標預計將提高到 6.6 至 7 倍，並假設我們在 2025 年之前無法將大部分 Pillarstone 投資貨幣化。我們非常高興地宣布每月股息水準增加 3%。我們認為股息應該隨著利潤而增長，並且我們相信我們將在 2024 年實現良好的盈利增長，並在 2025 年及以後繼續增長。

Thank you all for joining our earnings call. And with that, we'll open the line for questions.

感謝大家參加我們的財報電話會議。接下來，我們將開通提問專線。

Thank you. At this time, we'll be conducting a question-and-answer session. (Operator Instructions) Mitch Germain, Citizens JMP.

謝謝。此時，我們將進行問答環節。（操作員說明）Mitch Germain，Citizens JMP。

How are you?

你好嗎？

Good morning, Mitch. I think you broke up a bit. Good morning, Mitch.

早上好，米奇。我想你們分手了一點。早上好，米奇。

Yeah, sorry about that. My bad. I want to just -- obviously, you talked a little bit about quality of revenue. And it's -- I don't know. It seems like your bad debt is forecasted to be a little bit higher in 2024. I'm just curious in terms of -- I'm sure there's a little hint of conservatism in that number, but is there anything specific that is driving that midpoint of that number to be higher year over year?

是的，對此感到抱歉。我的錯。我想——顯然，你談到了一些關於收入品質的問題。這是——我不知道。預計 2024 年你的壞帳會略高一些。我只是很好奇——我確信這個數字有一點保守主義的暗示，但是有什麼具體的因素促使這個數字的中點逐年上升嗎？

Hey, Mitch; it's Scott. The bad debt assumptions we put into the forecast are a range that we're comfortable with. The midpoint isn't necessarily where we expect to end. And no, there's no specific tenants that we have identified that are going to drive higher bad debt next year.

嘿，米奇；是斯科特。我們在預測中所採用的壞帳假設是在我們滿意的範圍內。中點不一定是我們期望的結束點。不，我們沒有發現任何特定租戶會在明年推高壞帳。

Okay, that's helpful. What percentage of your portfolio comes from the smaller tenants relative to the larger ones? How should we think about that? Obviously, we talk about that obviously trend above peers, but what is it specifically?

好的，這很有幫助。相對於大型租戶，您的投資組合中小型租戶的比例是多少？我們該如何思考這個問題？顯然，我們談論的是明顯高於同業的趨勢，但具體是什麼？

Yeah, I think -- hey, Mitch; it’s Dave. In our PowerPoint for the call today -- I think David Mordy is going to give me a page number. But there's a page number that breaks out -- page 6 breaks out our tenant base. Approximately 75% of our ABR is in the smaller spaces that are really in high demand today. So we think that's a key differentiator of Whitestone versus many others in the sector, and we have the type of spaces that are in high demand.

是的，我想──嘿，米奇；這是戴夫。在我們今天電話會議的 PowerPoint 中，我想 David Mordy 會給我一個頁碼。但有一個頁碼是詳細的——第 6 頁詳細列出了我們的租戶基礎。我們大約 75% 的 ABR 位於當今需求量很大的較小空間中。因此，我們認為這是白石與該行業許多其他酒店的關鍵區別，而且我們擁有需求量很大的空間類型。

Agreed. Okay. Obviously, we've got a lot of products that seem to be going smaller and smaller. Dave, talk about -- obviously, you're in the process of deleveraging, but you interestingly mentioned activating your land parcels and some of your redevelopment opportunities.

同意。好的。顯然，我們有很多產品似乎變得越來越小。戴夫，談談——顯然，你正在去槓桿化的過程中，但你有趣地提到激活你的地塊和一些再開發機會。

Clearly, that creates a little bit of higher leverage initially before the EBITDA commences. So maybe if you could just provide some perspective on the potential opportunities that you've got embedded in the portfolio and how you feel some of those potential opportunities could be monetized.

顯然，在 EBITDA 開始之前，這會首先產生較高的槓桿率。因此，也許您可以就您在投資組合中嵌入的潛在機會以及您認為其中一些潛在機會如何貨幣化提供一些看法。

Yeah, Mitch. I’ll give a couple of high level comments, and maybe I'll ask Christine to share some more about the development opportunities. I will tell you, our goal and our challenge is to do a number of things. Over the last couple of years, we’ve improved our balance sheet. We've driven earnings. We've capitalized on development opportunities.

是的，米奇。我將給出一些高層次的評論，也許我會請 Christine 分享更多有關發展機會的資訊。我會告訴你，我們的目標和挑戰是要做很多事。在過去的幾年裡，我們改善了我們的資產負債表。我們推動了獲利。我們抓住了發展機會。

So it's always a balance. We're focused on the balance sheet improvement plan and have made strong progress. And then we're obviously top-line-focused on value creation. Maybe I'll let Christine comment a little bit on the development opportunities.

所以它總是一個平衡。我們專注於資產負債表改善計劃並取得了巨大進展。然後，我們顯然將重點放在價值創造上。也許我會讓克里斯汀評論一下發展機會。

Mitch, I think the best way to look at our portfolio is most of these are pads and smaller buildings. And so, the timeframe it takes to get these positioned through an approval process, which is a low-cost venture to start out, right, but just takes time -- by the time you get that in place and then you actually build, which is when you start your significant capital costs, that's like a six-month timeframe.

米奇，我認為審視我們的投資組合的最佳方式是，其中大部分都是住宅區和較小的建築。因此，透過批准流程來定位這些項目所需的時間範圍，這是一項低成本的創業項目，對吧，但只是需要時間——當你把它落實到位然後你實際建造時，這就是當當你開始投入大量資本成本時，這就像六個月的時間範圍。

So it doesn't take that long to build these pads out. It takes a while to get them approved within the zoning districts that you have to work with. So I like you to say, I think these things are very easy.

因此，建造這些墊不需要那麼長時間。它們需要一段時間才能在您必須合作的分區內獲得批准。所以我喜歡你說，我認為這些事情很容易。

Once you get approval, then your capital costs start, your significant capital costs, and that's maybe six months. And then once you get them out of the ground, then of course you're able to achieve on your returns with the rents. So most of ours are smaller pads.

一旦獲得批准，您的資本成本就開始了，巨大的資本成本，這可能需要六個月的時間。一旦你把它們挖出來，你當然就能透過租金獲得回報。所以我們大多數都是較小的墊。

So how many of these pads have entitlements right now?

那麼，這些墊子中有多少現在擁有權利呢？

We have -- we're doing three a year, and I'm looking to amp that up to like four to five in the following years to six. It depends. Like, Dana has a number of small pads that are already approved, but what we're doing is working through the right leasing strategy to move those forward.

我們每年做三件事，我希望在接下來的幾年裡將其增加到四到五件事，甚至六件事。這取決於。例如，達納（Dana）有許多已經獲得批准的小墊子，但我們正在做的是透過正確的租賃策略來推動這些墊子的發展。

Those are already fully approved at Dana Park. And those have -- let's see, I've got one, two, about seven pads there alone. So in the portfolio, we have about -- we have well over, I think, about 15 to 16 pads that we can work through over time. It's just a question of making sure that we can manage it appropriately within our timeframe, the leaseability with it, and also our resources with the team.

這些已經在達納公園獲得完全批准。讓我們看看，我那裡就有一個、兩個、大約七個墊子。因此，在產品組合中，我認為我們有超過 15 到 16 個可以隨著時間的推移而完成的墊子。這只是一個確保我們能夠在我們的時間範圍內適當管理它、它的可租賃性以及我們與團隊的資源的問題。

Great. That's helpful. Thanks. And last one from me. Just, Dave, maybe some perspective on the timing of the resolution of the damages associated with the Pillarstone ruling. Obviously, I believe the ruling had provided some sort of timeframe where some sort of remedy or valuation was necessary to be provided. Maybe put some perspective on where that stands, please.

偉大的。這很有幫助。謝謝。還有我的最後一張。戴夫，也許您對解決與 Pillarstone 裁決相關的損害賠償的時間表有一些看法。顯然，我認為該裁決提供了某種時間框架，需要提供某種補救或評估。也許請對目前的情況發表一些看法。

Sure. Obviously, we're very pleased with the ruling, which -- on our investment in Pillarstone, the court ruled that obviously we had been damaged and what we're looking for is an exit. We've communicated that all along.

當然。顯然，我們對裁決非常滿意，就我們對 Pillarstone 的投資而言，法院裁定我們顯然受到了損害，而我們正在尋找退出途徑。我們一直都在傳達這一點。

So Pillarstone has some obligations to the court to provide a value as well as a payment to us. I would tell you, we're moving into the collection phase, and we are focused on getting that collected and exited as quickly as possible.

因此，Pillarstone 對法院負有一些義務，向我們提供價值和付款。我想告訴你，我們正在進入收集階段，我們的重點是盡快收集並退出。

Scott commented in the guidance. We only have a partial part of that monetization in this year. We have the balance in 2025. I'd love to report in the year that we got that much more quickly.

斯科特在指南中評論道。今年我們只實現了部分貨幣化。到 2025 年我們會有餘額。我很樂意在這一年報告說，我們實現這一目標的速度要快得多。

So right now, we're very pleased with where we are as far as the decision. We're looking for an orderly monetized exit, a plan of exit, which I believe we have in progress, and we'll move quickly. It's hard to give you exact timing just because we're working through the court system. We're working through a number of things, but all of the decisions have been very supportive and very much in Whitestone’s favor at this point.

所以現在，我們對目前的決定感到非常滿意。我們正在尋找有序的貨幣化退出、退出計劃，我相信我們已經取得進展，而且我們會迅速採取行動。很難給你確切的時間，因為我們正在透過法院系統進行工作。我們正在解決許多問題，但目前所有決定都非常支持並且非常有利於懷特斯通。

Thank you.

謝謝。

Thanks, Mitch.

謝謝，米奇。

Thank you. Anthony Hau, Truist Securities.

謝謝。安東尼·豪（Anthony Hau），Truist 證券公司。

Good morning, guys. Thanks for taking my question. So this morning, I saw the news that Erez Asset Management plans to nominate two directors to the Board, and they raised a few questions, right? Since the December press release, what other discussions and conversation have the board had with Bruce and his proposal to liquidate? And have you guys thought about adding Board members that have more relevant real estate experience?

早上好傢伙。感謝您提出我的問題。那麼今天早上，我看到Erez資產管理公司計劃提名兩位董事進入董事會的消息，他們提出了一些問題，對嗎？自 12 月新聞稿發布以來，董事會與 Bruce 及其清算提議進行了哪些其他討論和對話？你們是否考慮增加更多相關房地產經驗的董事會成員？

Thanks, Anthony. It's Dave. I'll give a couple of comments to that. First of all, just off the top, obviously, we don't comment on articles like the Bloomberg article. We don't comment on market rumors or quotes from unnamed sources.

謝謝，安東尼。是戴夫。我對此發表幾點評論。首先，很明顯，我們不會對像彭博社文章這樣的文章發表評論。我們不對市場傳言或未透露姓名的消息來源的報價發表評論。

We did publish in December a letter we received from Mr. Schanzer with Erez. We did that because we think it's important to be transparent. We want to have great discussions with shareholders, and we want to minimize misinformation.

我們確實在 12 月發表了一封來自 Schanzer 先生和 Erez 的信。我們這樣做是因為我們認為保持透明很重要。我們希望與股東進行深入討論，並希望盡量減少錯誤訊息。

We love and welcome shareholder feedback and discussion, but we don't discuss individual shareholder discussions, obviously, publicly. Really proud of the progress we've made over the last couple of years. We're focused on execution and delivery. And obviously, at this point, that's kind of what we can say.

我們喜歡並歡迎股東的回饋和討論，但顯然我們不會公開討論個人股東的討論。我們對過去幾年所取得的進步感到非常自豪。我們專注於執行和交付。顯然，在這一點上，這就是我們可以說的。

I think we’ve published the letter from Bruce. We've published our response. Obviously, happy with a follow-up question, Anthony, but I think that's the comment I would make at this point on your question.

我想我們已經發表了布魯斯的信。我們已經發布了我們的回應。顯然，安東尼對後續問題很滿意，但我想這就是我此時對你的問題要發表的評論。

Oh, the only thing I would add is, we've done a lot of refreshing and upgrading our Board, brought on great new skillsets and diversity, continue to look at that, continue to evaluate that we have the right people in place. And I think our Board feels very good about that. Our Board also takes the strategic role they have in looking at the ways we create value very seriously, and we take that very seriously.

哦，我唯一要補充的是，我們已經對董事會進行了大量的更新和升級，帶來了出色的新技能和多樣性，繼續關注這一點，繼續評估我們是否擁有合適的人員。我認為我們的董事會對此感覺非常好。我們的董事會也非常重視他們在我們創造價值的方式方面所發揮的戰略作用，我們也非常重視這一點。

Okay. Sorry if I missed this, but like property operating and maintenance was up 27% in the same-store pool this quarter. What drove that increase? Was it -- and was that the main reason why same-store NOI for 2023 was at the low end of the guidance?

好的。抱歉，如果我錯過了這一點，但本季同店池中的物業運營和維護增長了 27%。是什麼推動了這項成長？這是 2023 年同店 NOI 處於指導低端的主要原因嗎？

Anthony, it’s Scott. On the maintenance side, we accelerated some large maintenance items, exterior painting of buildings, parking lot resurfaces in six or seven properties in Arizona. We think that's going to add value and help with leasing rates.

安東尼，這是史考特。在維修方面，我們加快了亞利桑那州六、七處房產的一些大型維修工程、建築物外牆粉刷、停車場重新鋪設的速度。我們認為這將增加價值並有助於提高租賃率。

Those properties happen to have a little lower recovery rate than the majority of our portfolio. So that was a component of the same-store being a little lower than expected. The other one was -- I think Christine mentioned delayed commencement in EoS drove another portion of it. And then we had Bed, Bath & Beyond that was re-tenanted towards the end of the year that was a smaller piece.

這些房產的回收率恰好比我們大多數投資組合的回收率要低一些。所以這是同店銷售略低於預期的一個組成部分。另一個是——我認為 Christine 提到的 EoS 延遲啟動推動了另一部分。然後我們在年底重新租用了床、浴室和其他設施，這是一個較小的部分。

So those are the three components of the same-store decrease. And then once again, on the maintenance side, those painting and parking lot resurfaces are once-every-10-year type of expenses.

這些就是同店減少的三個組成部分。然後，在維護方面，油漆和停車場重新鋪設是每 10 年一次的費用。

Got you. And then a quick one on Pillarstone, I know that you guys are going through the bankruptcy court now. What are the chances that Whitestone can fully recover the monetary judgment amount?

明白你了。然後是關於 Pillarstone 的快速介紹，我知道你們現在正在經歷破產法庭。白石能夠完全收回金錢判決金額的機會有多大？

Hey, Anthony; it’s Dave. As you said, we are moving toward the collection phase at this point, with receiving very positive rulings that we'd been damaged and that we had the right to exit. As you said, Pillarstone has filed bankruptcy, and we're moving through that.

嘿，安東尼；這是戴夫。正如您所說，我們目前正在進入收集階段，並收到非常積極的裁決，表明我們受到了損害，並且我們有權退出。正如您所說，Pillarstone 已申請破產，我們正在解決這個問題。

We remain confident in the value of that investment. When you look at the underlying assets, our investment on our books is roughly $30 million. We continue to believe that the value of the underlying assets is north of that. So it's hard to nail down a number, but I do think we're in the process now of moving through that and hopefully getting this noise out of the story very shortly.

我們對該投資的價值仍然充滿信心。當你查看基礎資產時，我們帳面上的投資約為 3000 萬美元。我們仍然認為基礎資產的價值高於此。所以很難確定一個數字，但我確實認為我們現在正在解決這個問題，並希望很快就能將這種噪音從故事中消除。

Thanks, guys.

多謝你們。

Thanks, Anthony.

謝謝，安東尼。

Thank you. Barry Oxford, Colliers.

謝謝。巴里牛津，高力國際。

Great. Hi guys. On the disposition market, when you guys are looking at that, is it fairly fluid? And are the buyers able to get financing relatively easily?

偉大的。嗨，大家好。在配置市場上，當你們看到這個時，它是否相當流暢？買家能夠相對容易獲得融資嗎？

Hey, Barry; it’s Dave. Very good question. I think we continue -- we are seeing a little bit of uptick in the transaction market, I think, as we all get more clarity on where interest rates are. Still not super deep, but we're seeing more transactions. And I would say we are seeing the buyers able to get financing.

嘿，巴里；這是戴夫。非常好的問題。我認為我們會繼續下去——我認為，我們看到交易市場略有回升，因為我們都對利率水準有了更清晰的了解。仍然不是非常深，但我們看到了更多的交易。我想說的是，我們看到買家能夠獲得融資。

So in some recent transactions, there's been a financing component, and we've seen the ability to get financing at rates that are probably now closer to 6%, a little bit above that, but rates that can work. So we are seeing that market normalize. We're also seeing, on the sales side -- on the acquisition side, we're seeing cap rates move up a bit. So we're continuing to monitor that for great opportunities.

因此，在最近的一些交易中，存在融資成分，我們已經看到能夠以現在可能接近 6% 的利率獲得融資，略高於該利率，但利率是可行的。所以我們看到市場正常化。我們也看到，在銷售方面——在收購方面，我們看到資本化率略有上升。因此，我們將繼續監控這一情況，以尋找巨大的機會。

Yeah. Is it your plan as much as humanly possible to match the dispositions and acquisitions? Or do you think one will run in front of the other this year?

是的。您的計劃是否盡可能匹配處置和收購？或者你認為今年會有一個人跑在另一個人的前面嗎？

Yeah, I think we -- I'll say it this way. Our responsibility and what we focus on every day is creating and adding value. Over the last couple of years, we've been continuing to upgrade the portfolio through a bit of recycling, really selling assets and redeploying into new assets.

是的，我想我們──我會這樣說。我們的責任和我們每天關注的焦點是創造和增加價值。在過去的幾年裡，我們一直在透過一些回收、真正出售資產並重新部署到新資產來繼續升級投資組合。

I think right now, I think I mentioned in my remarks that we've done about $80 million in the last 18 to 20 months. We believe that kind of that level is probably appropriate for a portfolio our size on an ongoing basis.

我想現在，我想我在演講中提到，我們在過去 18 到 20 個月裡已經完成了大約 8000 萬美元。我們認為，這種水準可能適合我們規模的投資組合持續進行。

And our guidance we've given is the asset base as it is today, but we do believe there's going to be opportunities that are starting to open up for acquiring assets and potentially growing and scaling this platform as well.

我們給出的指導是當今的資產基礎，但我們確實相信將會出現收購資產以及潛在成長和擴展該平台的機會。

As we've said for the last couple of years, we're going to be very, very disciplined in capital allocation, making sure those decisions are the right decisions for long term value. But for the last couple of years, it's been largely sales and dispositions, one for one. I would expect that that would be similar in 2024, but we think there's going to be opportunities as things continue to improve.

正如我們過去幾年所說的那樣，我們將在資本配置方面非常非常嚴格，確保這些決策是具有長期價值的正確決策。但在過去的幾年裡，主要是一對一的銷售和處置。我預計 2024 年情況會類似，但我們認為隨著情況不斷改善，將有機會。

Great. Thanks so much, guys. Have a good one.

偉大的。非常感謝，夥計們。祝你有個好的一天。

Thank you. John Massocca, B. Riley Securities.

謝謝。約翰‧馬索卡 (John Massocca)，B. 萊利證券 (Riley Securities)。

Good morning.

早安.

Morning, John.

早安，約翰。

Maybe to think about the guidance. As you think about kind of the $0.03 drag from your costs associated with the ongoing situation around Pillarstone, can you provide a more color as to what you're assuming there? Is it a resolution to legal issues and bankruptcy court-related issues now in July? Or is it that kind of ongoing for the full year as you look at guidance today?

也許要考慮一下指導。當您考慮與 Pillarstone 周圍的持續情況相關的成本 0.03 美元的拖累時，您能否提供更多關於您在那裡的假設的信息？現在是在七月解決法律問題和破產法庭相關問題嗎？或者，當您今天查看指導時，全年都會持續這種情況嗎？

I’ll let Scott maybe talk at guidance. But on the Pillarstone front, I think largely our efforts are related to collection. So think of it that way. In other words, now we’ve moved through the process. We’ve done our redemption of our ownership effort, and now we're going to work to get those mounts collected. So that's largely the activities. And I'll let Scott maybe give further comments.

我可能會讓斯科特在指導下講話。但在 Pillarstone 方面，我認為我們的努力很大程度上與收集有關。所以這樣想吧。換句話說，現在我們已經完成了這個過程。我們已經完成了所有權的贖回，現在我們將努力收集這些坐騎。這主要是活動。我會讓斯科特發表進一步的評論。

Well, on the guidance side, I don't think it's a $0.03 drag. I think we've got $0.03 of additional just in the other category. And so when you look at the guidance for 2024 against what we had in 2023, we're expecting lower litigation costs around Pillarstone.

嗯，就指導而言，我認為這不會造成 0.03 美元的拖累。我認為我們在其他類別中額外獲得了 0.03 美元。因此，當您將 2024 年的指導與 2023 年的指導進行比較時，我們預計 Pillarstone 的訴訟成本將會降低。

And then also we redeemed our OP units in January. So the line on our income statement that's had a deficit related to Pillarstone goes away starting January 25 or so. So I think we expect a little bit of pickup from just no longer recognizing equity method deficits associated with Pillarstone, and we move on to collecting the amounts that were due and then we expect lower litigation cost.

然後我們在一月份贖回了我們的 OP 單位。因此，我們的損益表中與 Pillarstone 相關的赤字行將從 1 月 25 日左右開始消失。因此，我認為我們預計，不再承認與 Pillarstone 相關的權益法赤字會帶來一點好處，我們會繼續收取到期金額，然後我們預計訴訟成本會降低。

Okay. And when you say a $0.03 drag, I mean, versus kind of run rate, no Pillarstone at all --

好的。當你說 0.03 美元的阻力時，我的意思是，相對於某種運行率，根本沒有 Pillarstone--

Oh, okay. Oh, sure.

哦好的。哦沒問題。

Are you kind of assuming that being a full year to kind -- those elevated G&A costs? Or is that something that should end roughly in July just because you mentioned it as when you expected to -- or at least were guiding to start monetizing or collecting some kind of monetization from the Pillarstone assets?

您是否假設一整年都會增加一般管理費用？或者說，這件事應該在 7 月左右結束，只是因為您在預期時提到了這一點，或者至少在指導您開始貨幣化或從 Pillarstone 資產中收集某種貨幣化？

Well, we've forecasted about $1.5 million of litigation expense associated with Pillarstone. It's hard to predict the timing of when all those -- when the matters get resolved.

嗯，我們預測與 Pillarstone 相關的訴訟費用約為 150 萬美元。很難預測所有這些問題何時得到解決。

Okay. that's fair. And then apologies if I missed this earlier in the call, but the acquisition in February, Garden Oaks. Can you provide some color as to pricing and going in yield on that investment?

好的。這還算公平。如果我在早期的電話會議中錯過了這一點，那麼我深表歉意，但我在二月收購了 Garden Oaks。您能否提供有關該投資的定價和收益率的一些資訊？

Sure. Hey, John. So in early 2024, we were pleased to close on a really nice acquisition in Houston in the Garden Oaks submarket, which is an area that is very, very strong; continues to improve. And so really pleased with that.

當然。嘿，約翰。因此，在 2024 年初，我們很高興在休士頓 Garden Oaks 子市場完成了一項非常好的收購，該地區非常非常強大；持續改善。對此我真的很滿意。

It's an Aldi -- it’s a center that has an Aldi. It has several tenants that are the type of tenants we like that support the surrounding community and has real upside, I think, from continuing to apply what we do well, which is Christine and our team just really looking at the tenants and what they provide the community. So we're very pleased with the acquisition. I think it fits our portfolio well.

這是一家阿爾迪——這是一個擁有阿爾迪的中心。它有幾個租戶是我們喜歡的租戶類型，他們支持周圍的社區，我認為，透過繼續應用我們擅長的東西，克里斯汀和我們的團隊真正關注租戶及其提供的東西，它們具有真正的優勢社區。所以我們對這次收購非常滿意。我認為它非常適合我們的投資組合。

It was part of our capital recycling program. So I think we’ve upgraded to a much better asset there with greater upside than what we disposed of. As far as pricing and cap rates, I think that at this point, we have not -- I think that the 10-K will have -- the acquisition price, I think, David, probably will be in the 10-K that's filed.

這是我們資本回收計劃的一部分。因此，我認為我們已經在那裡升級為更好的資產，比我們處置的資產具有更大的上升空間。就定價和資本化率而言，我認為目前我們還沒有——我認為 10-K 將會有——收購價格，大衛，我認為可能會在提交的 10-K 中。

But we haven't given individual cap rates on acquisitions. But I will tell you it is -- I think we shared with you the capital recycling program that we've been able to sell assets kind of at the six-two cap rate going out, and we are buying assets above that. So this fits in that scenario.

但我們沒有給出具體的收購上限利率。但我會告訴你，我想我們與你分享了資本回收計劃，我們已經能夠以六比二的上限利率出售資產，並且我們正在購買高於該利率的資產。所以這適合這種情況。

But there'll be some -- I can't remember the exact amount. It was in the $20 million to $30 million range is what the acquisition price was, but that exact amount will be in the 10-K we file very shortly. And then just -- we haven't given cap rates on individual sales or dispositions.

但會有一些——我不記得確切的數量了。收購價格在 2,000 萬至 3,000 萬美元之間，但具體金額很快就會在我們提交的 10-K 中。然後，我們還沒有給出個人銷售或處置的上限利率。

Okay, that's understood. And then maybe bigger picture. I know you've given very clear NOI guidance, but how should we think about rent growth as a component of that? Is what you were seeing in 2023 something you think you can continue into 2024? Or is a lot of that NOI guidance going to be maybe lighter maintenance CapEx just given some of the items that were in your 2023 results?

好的，明白了。然後也許還有更大的前景。我知道您已經給出了非常明確的 NOI 指導，但我們應該如何考慮租金增長作為其中的一部分？您認為 2023 年所看到的情況可以持續到 2024 年嗎？或者，鑑於 2023 年業績中的一些項目，NOI 指導中的許多內容可能只是較輕的維護資本支出？

Yeah, I think we're still seeing continued rent growth in all of our markets. And I think the benefit now is we have filled most of our larger boxes. And again, we don't have that many of them, but that was the challenge coming in 2022 and early 2023. And so the smaller spaces -- and by the way, smaller spaces doesn't mean smaller balance sheets, and they're a lot less capital-intensive to turn.

是的，我認為我們所有市場的租金仍在持續成長。我認為現在的好處是我們已經填滿了大部分較大的盒子。再說一次，我們沒有那麼多，但這是 2022 年和 2023 年初面臨的挑戰。因此，更小的空間——順便說一句，更小的空間並不意味著更小的資產負債表，而且它們的資本密集度要低得多。

We anticipate with -- again, with revenue -- the quality of revenue initiative, a lot of what we're looking at is, if we do have weaker tenants that aren't successfully serving the communities in this strong market, it makes sense to actually look at those businesses and transition them out and build in stronger operations.

我們預計 - 再次，收入 - 收入計劃的質量，我們關注的很多內容是，如果我們確實有實力較弱的租戶，無法成功地為這個強大的市場中的社區提供服務，那麼這是有道理的真正審視這些業務並將其轉型並建立更強大的業務。

Hey, John. One thing I might just add. I know you know this, but just one of the benefits obviously is Whitestone's shorter leases, which enables us to capture those market increases more quickly. So if you look at our spreads, they're very strong, and I think they're even stronger when you take into account the length of our leases compared to some of the others that report spreads.

嘿，約翰。我想補充一件事。我知道您知道這一點，但顯然，白石的好處之一是較短的租期，這使我們能夠更快地抓住市場成長的機會。因此，如果你看一下我們的利差，你會發現它們非常強勁，而且我認為，與其他一些報告利差的公司相比，如果考慮到我們的租賃期限，它們甚至會更強。

Okay, that's very helpful, and that's it for me. Thank you very much.

好的，這非常有幫助，對我來說就是這樣。非常感謝。

Thank you.

謝謝。

Thank you. (Operator instructions) Michael Diana, Maxim Group.

謝謝。（操作員說明）Michael Diana，Maxim 集團。

Hey, thank you. Obviously, most of my questions have been asked. You made great progress on getting rid of non-core assets that don't fit. I think you said the only one that's left really is your headquarters building. Do you have anything -- is there any comment about that?

嘿，謝謝你。顯然，我的大部分問題都被問到了。您在擺脫不合適的非核心資產方面取得了巨大進展。我想你說過唯一剩下的就是你的總部大樓。有什麼想說的嗎？對此有什麼評論嗎？

I’ll just -- so our headquarters office building is a six-story suburban office building. It is probably roughly 50% occupied. So it's very similar to some of that office product, incredibly different than everything else we have in our portfolio, which are community centers that support neighborhoods. '

我只是——所以我們的總部辦公大樓是一棟六層樓的郊區辦公大樓。大概有 50% 被佔用。因此，它與某些辦公產品非常相似，與我們產品組合中的其他產品（支持社區的社區中心）有著驚人的不同。'

So I think we -- as Christine mentioned, we would -- we expect to probably exit that property. For us, it's just making sure we find a nice home for our roughly 50 people in Houston that occupy that where our headquarters are. We'd love to be in one of our retail centers, similar to we have in some other markets.

所以我認為我們——正如克里斯汀所提到的，我們會——我們預計可能會退出該財產。對我們來說，這只是確保我們在休士頓總部所在地為大約 50 名員工找到一個美好的家。我們很樂意在我們的零售中心之一，類似於我們在其他一些市場的零售中心。

But I think when we look at our portfolio, kind of the non-core assets that don't fit this geography or the strategy, we've made a lot of progress there. And Woodlake is the only one we identify.

但我認為，當我們審視我們的投資組合時，即不適合這個地理位置或策略的非核心資產，我們已經在這方面取得了很大進展。伍德萊克是我們唯一確定的一位。

Recycling-wise, we'll always be looking at properties that we’ve owned for a period of time, we’ve added value, and we feel like there's a better way to redeploy those proceeds, just like you would do with a stock portfolio. So strategically, really Woodlake would probably be the only property at this point that doesn't fit the strategy. And then capital recycling, we’ll continue to look at redeploying proceeds where we can create more value.

在回收方面，我們將始終關注我們已經擁有一段時間的財產，我們已經增加了價值，並且我們認為有更好的方法來重新部署這些收益，就像您所做的那樣股票投資組合。因此，從戰略上講，伍德萊克實際上可能是目前唯一不符合該策略的財產。然後是資本回收，我們將繼續考慮將收益重新部署到可以創造更多價值的地方。

All right. Thanks, Dave.

好的。謝謝，戴夫。

Thanks, Michael.

謝謝，麥可。

Thank you. Anthony Hau, Truist Securities.

謝謝。安東尼·豪（Anthony Hau），Truist 證券公司。

Hey guys. Sorry, just a quick follow-up. I noticed that the 24,000 square feet box at Windsor Park is still vacant. What's the plan for that space and what type of demand are you guys seeing for this box?

大家好。抱歉，只是快速跟進。我注意到溫莎公園的24,000平方英尺的包廂仍然空著。該空間的計劃是什麼？你們認為這個盒子有什麼類型的需求？

Strong demand, but it's one of our only centers that's a power center and has similar situations that other power centers have. And it has some of those restrictions and covenants that you have to work through. So the demand is there.

需求強勁，但它是我們唯一的權力中心之一，並且與其他權力中心有類似的情況。它有一些您必須克服的限制和契約。所以需求就在那裡。

We actually have a very interested party, and we're just having to work through those, what I would consider items that are negotiable, but just take time because we have to work through that with the other tenants. So the demands there -- and I'm not concerned about filling it. Actually, we have two interested parties in it. So it's just working through the timing with a couple of other tenants that are existing in the center.

我們實際上有一個非常感興趣的團體，我們只需要解決這些問題，我認為這些項目是可以協商的，但只是需要時間，因為我們必須與其他租戶一起解決這個問題。所以那裡的要求——我不關心滿足它。事實上，我們有兩個感興趣的方面。因此，它只是與中心現有的幾個其他租戶一起確定時間。

And I'm assuming that you guys are trying to remove those like covenants, right? Because I know that's one of the -- I think one of the key things that Dave always talks about.

我假設你們正試圖消除那些契約之類的東西，對吧？因為我知道這是戴夫經常談論的關鍵事情之一。

Yeah. As you know, that's something that we -- that's one of the business models that we have that we avoid. This is one of the very few centers that we have that. It's one of the legacy assets, but it's also a very well-located center in San Antonio. It's right at two major highways. So like I said, the demand is there, but this is a little bit slow going, but we anticipate that we'll have that completed this year.

是的。如您所知，這是我們所避免的商業模式之一。這是我們擁有的極少數中心之一。它是遺產資產之一，但也是聖安東尼奧位置非常優越的中心。它位於兩條主要高速公路旁。正如我所說，需求是存在的，但進展有點緩慢，但我們預計今年將完成。

And how about the Office Depot at that -- I think there's an Office Depot at the same asset, right? I think.

那麼 Office Depot 怎麼樣——我認為同一資產上也有一個 Office Depot，對嗎？我認為。

Yeah, there is. So what I'm finding is Office Depot has changed their business model a little bit. And they act more like a distribution center and a little less like retail, but it performs well there. All the tenants that are there perform very well.

是的，有。所以我發現 Office Depot 稍微改變了他們的商業模式。他們的行為更像是一個配送中心，而不是零售中心，但在那裡表現良好。那裡的所有租戶都表現得很好。

Okay, thanks.

好的謝謝。

Hey, Anthony, one thing I would just want to note with this is that there is -- we are finding that there's a different type of demand now for larger boxes, but there is demand that actually is coming around fairly strongly in retail. It's just shifted to a different type of user.

嘿，安東尼，我想指出的一件事是，我們發現現在對大盒子有不同類型的需求，但零售業的需求實際上相當強勁。它只是轉移到了不同​​類型的用戶。

What do you mean by that?

你是什​​麼意思？

Less hard -- yeah, less hard goods, more services or a product and a service. So it's a move to -- that's why we moved to work with EoS at one of our centers, right, because why compete with two other large grocers in the market that are already performing well? And when we did the study and found out that they were missing a fitness type of operator, we went for the strongest operator that was coming into the market.

減少硬商品－是的，減少硬商品，增加服務或產品和服務。所以這是一個轉變——這就是為什麼我們轉向在我們的一個中心與 EoS 合作，對吧，因為為什麼要與市場上已經表現良好的另外兩家大型雜貨店競爭？當我們進行研究並發現他們缺少適合類型的運營商時，我們選擇了進入市場的最強運營商。

So that's what you look at with these boxes. I will -- instead of leaning into hard goods, I'll lean into something that drives repeat visits because then it benefits all the other clients in the center and it benefits the market as a whole when we do that, because again, there's more of a drive for services right now than product - -the sale of hard goods and soft goods.

這就是您在這些盒子中看到的內容。我會——而不是傾向於硬商品，我會傾向於那些能夠推動重複訪問的東西，因為這樣一來，它就會使中心的所有其他客戶受益，並且當我們這樣做時，它也會使整個市場受益，因為同樣，還有更多現在對服務的驅動力大於對產品的驅動力——硬商品和軟商品的銷售。

And then like for these big box, like, have you guys ever considered just like kind of like dividing the space up to like smaller spaces? Because I know some of your peer set, they're trying to do that, right, try to convert these big boxes more these like small shop space to drive higher rents for the center.

然後就像這些大盒子一樣，你們有沒有考慮過將空間分成更小的空間？因為我知道你們的一些同行，他們正在嘗試這樣做，對吧，嘗試將這些大盒子改造成更多的小商店空間，以提高中心的租金。

Yeah. It depends on the demand in the area. And one of the things that we always have to look at with this type of -- there's always a cost with that. And so how much linear square footage that -- how much linear feed do you have a frontage compared to what type of depth you have?

是的。這取決於該地區的需求。對於這種類型，我們總是必須考慮的事情之一——總是有成本的。那麼，與您擁有的深度相比，您的正面正面有多少線性面積？

So fortunately, we don't have a lot of that type of problem within the portfolio. And we've been able to fill the boxes pretty effectively this year and last year because there is -- again, the demand is just tapping in the right type of demand making sure that it evolves with the shift and the change in the neighborhood. But yeah, we’ve done that a couple of times where necessary, but we're always kind of cognizant of what the returns would be for doing that.

幸運的是，我們的產品組合中沒有很多此類問題。今年和去年我們能夠非常有效地填補這些空白，因為需求只是利用了正確類型的需求，確保它隨著社區的轉變和變化而發展。但是，是的，我們已經在必要時這樣做過幾次，但我們總是知道這樣做的回報是什麼。

Okay. Sorry, just one last one for me. Which tenant replaced the Bath Beyond box?

好的。抱歉，給我最後一張。哪個租戶更換了 Bath Beyond 盒子？

That was the Pickler. So we're finding this to be a very interesting source of traffic for our centers, and especially with repeat businesses. So we had a number -- and two things about this. Because this is such a hot sport right now, and it's really interesting to see that's a very -- it's a hot sport for a very interesting demographic. We're finding that the demographic that visits for this has a high repeat visit factor of like three times a week, number one.

那是pickler。因此，我們發現這對我們的中心來說是一個非常有趣的流量來源，尤其是對於回頭客而言。所以我們有一個數字——以及與此相關的兩件事。因為現在這是一項非常熱門的運動，而且看到它對於非常有趣的人群來說是一項非常熱門的運動，這真的很有趣。我們發現，為此訪問的人群具有很高的重複訪問率，大約每週 3 次，這是第一個。

And also, it happens to be younger people that are playing the sport indoors, all right? So they're younger, career-oriented professionals that are looking to make sure they can reserve a court time versus waiting for the weather and other types of elements to play outside.

而且，在室內進行這項運動的剛好是年輕人，好嗎？因此，他們是年輕的、以職業為導向的專業人士，希望確保自己可以預訂球場時間，而不是等待天氣和其他類型的因素在外面比賽。

So we studied this. We investigated a number of operations that are growing very, very fast and we made a decision to work with one that was more dedicated to the sport. That's Pickler, and they're out of Utah, and they've done a really good job with their -- we not only studied them.

所以我們研究了這個。我們調查了一些發展非常非常快的業務，並決定與更專注於這項運動的公司合作。那是皮克勒，他們來自猶他州，他們的工作做得非常好——我們不僅研究了他們。

We went to visit them. We went to visit other business units as well to understand how they make money. And it's a relatively low labor cost, and it's actually a low capital cost that you need to put into these things, but the returns are pretty high on their sales.

我們去拜訪他們。我們也參觀了其他業務部門，了解他們是如何賺錢的。這是一個相對較低的勞動成本，實際上你需要投入這些東西的資本成本也很低，但他們的銷售回報卻相當高。

So we want to find the right one, the one that understood how to tap into the market quickly and had the first mover advantage. And so we worked with Pickler, and very happy. They just got their permit, and we expect them to be open shortly.

因此，我們希望找到合適的人，懂得如何快速進入市場並擁有先發優勢的人。所以我們與 Pickler 合作，非常愉快。他們剛剛獲得許可證，我們預計他們很快就會開業。

Yeah. That's pickleball, right? I just want to make sure.

是的。那是泡菜球，對吧？我只是想確定一下。

Yeah, it's pickleball. I'm sorry. This is -- yeah, for those that are wondering who the Pickler is, it's pickleball. There are a number of variants on this, but we moved more towards the people that are more interested in playing and less towards the entertainment type of venue, like chicken and pickle, which are great, but they're a higher capital cost. So we went more into the -- what we consider the hardcore and the consistent player that likes to show up every week.

是的，這是泡菜球。對不起。這是——是的，對於那些想知道 Pickler 是誰的人來說，這是 Pickleball。這方面有很多變體，但我們更轉向那些對玩耍更感興趣的人，而不是轉向娛樂類型的場所，例如雞肉和泡菜，它們很棒，但資本成本更高。因此，我們更深入地探討了我們所認為的鐵桿玩家和每週都會出現的穩定玩家。

Okay. Well, thanks for the color. Really appreciate it.

好的。嗯，謝謝你的顏色。真的很感激。

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

謝謝。女士們先生們，我們的問答環節到此結束。我將把最後的意見轉回給霍爾曼先生。

Well, first of all, thank everyone for attending today. As I said in my comments, I can't be more bullish about the strong fundamentals of our business and how Whitestone is positioned. We are excited and looking forward to a strong 2024 and look forward to providing updates as we move throughout the year.

那麼首先感謝大家今天的到來。正如我在評論中所說，我對我們業務的強勁基本面以及白石的定位非常樂觀。我們對 2024 年的強勁表現感到興奮和期待，並期待在全年的進展中提供最新資訊。

So once again, thanks to all. I hope you have a great day. Thank you.

再次感謝大家。希望你有美好的一天;希望你今天過得很開心。謝謝。

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。