Whitestone REIT (WSR) 2024 Q2 法說會逐字稿

Ladies and gentlemen, good morning and welcome to the Whitestone REIT second quarter 2024 earnings conference call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. (Operator Instructions) As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, David Mordy, Director of Investor Relations. Please go ahead.

女士們、先生們，早安，歡迎參加 Whitestone REIT 2024 年第二季財報電話會議。此時，所有參與者都處於只聽模式。正式演講後將舉行簡短的問答環節。（操作員指示）謹此提醒，本次會議正在錄製中。現在我很高興向您介紹主持人，投資者關係總監大衛莫迪（David Mordy）。請繼續。

Good morning, and thank you for joining Whitestone REIT's second quarter 2024 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. 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.

早安，感謝您參加 Whitestone REIT 的 2024 年第二季財報電話會議。與我一起參加今天電話會議的是執行長 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。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。

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. 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, August 1, 2024. The company undertakes no obligation to update this information. Whitestone's second 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.

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，以詳細討論這些因素。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 8 月 1 日）才準確。本公司不承擔更新該資訊的義務。Whitestone 第二季財報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。

We published second quarter 2024 slides on our website yesterday afternoon, which highlight topics to be discussed today. I will now turn the call over to Dave Holeman, our Chief Executive Officer.

昨天下午，我們在網站上發布了 2024 年第二季幻燈片，其中重點介紹了今天要討論的主題。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. Good morning and thank you for joining Whitestone's second quarter 2024 earnings conference call. We had another very strong quarter. Extending out to nine quarters, we have now had 17% plus leasing spreads. Beyond the very strong supply and demand fundamentals underpinning our business, our strategy and our focus on operations are driving strong same store net operating income growth, which is the key to our long term earnings growth.

謝謝你，大衛。早安，感謝您參加 Whitestone 2024 年第二季財報電話會議。我們又經歷了一個非常強勁的季度。延長至九季，我們現在的租賃利差已超過 17%。除了支撐我們業務的非常強勁的供需基本面之外，我們的策略和對營運的關注正在推動同店淨營業收入的強勁增長，這是我們長期盈利增長的關鍵。

We reiterated our 2024 core FFO guidance of $0.98 to $1.04 this morning and delivered $0.24 core FFO per share for the quarter. We remain on track with our internal forecasts for the year. In the second quarter, we signed new and renewal leases at a blended 17.5% increase over the prior leases on a straight line basis and a 7.7% increase on a cash basis. We grew our top line revenue over 3.3%, producing 6.6% growth in same store NOI and achieving core FFO per share of $0.24 and we continued to strengthen our balance sheet with debt to EBITDAre at 8 times.

今天上午，我們重申了 2024 年核心 FFO 指導價為 0.98 美元至 1.04 美元，並交付了本季每股 0.24 美元的核心 FFO。我們仍然按照今年的內部預測進行。第二季度，我們簽訂的新租約和續約租約比之前的租約直線增加 17.5%，現金基礎增加 7.7%。我們的營收成長了 3.3% 以上，同店 NOI 成長了 6.6%，每股核心 FFO 達到 0.24 美元，我們繼續強化我們的資產負債表，債務與 EBITDA 的比率達到了 8 倍。

Excluding the proxy contest fees in the quarter, our debt to EBITDAre ratio was 7.5 times, an improvement of 0.8 times from a year ago. Our occupancy was 93.5% at the end of the quarter, up 20 basis points from a year ago, and our net effective annual base rent per square foot was $24, up 5.4% from 2023. We recently took a harder look at some of our key differentiators in terms of our ability to drive growth, and I wanted to share some of those with you this morning. These key differentiators are captured on slide 3.

剔除本季的代理競賽費用，我們的債務與 EBITDAre 比率為 7.5 倍，比一年前提高了 0.8 倍。截至本季末，我們的入住率為 93.5%，比去年同期成長 20 個基點，每平方英尺淨有效年基本租金為 24 美元，比 2023 年成長 5.4%。我們最近更仔細地審視了我們在推動成長的能力方面的一些關鍵差異化因素，今天早上我想與大家分享其中的一些差異化因素。這些關鍵差異在投影片 3 中有所體現。

Strategically, these key differentiators allow us to focus our acquisition efforts where we can drive results quickly once we take possession of a property. We assess demand growth drivers in the neighborhood anchoring the property and determine if our team will be able to improve the alignment of tenants with the surrounding demand. Our leasing team's strength is placing high growth tenants in centers with 1,500 to 3,000 square foot spaces. We have long believed that neighborhood and community centers correctly configured with the right mix of 1,500 to 3,000 square foot spaces will outperform larger box centers.

從策略上講，這些關鍵的差異化因素使我們能夠集中收購工作，一旦我們擁有房產，我們就可以快速取得成果。我們評估固定該物業的社區的需求成長驅動因素，並確定我們的團隊是否能夠改善租戶與周圍需求的一致性。我們的租賃團隊的優勢是將高成長的租戶安置在面積為 1,500 至 3,000 平方英尺的中心。長期以來，我們一直相信，正確配置 1,500 至 3,000 平方英尺空間的鄰里和社區中心將優於較大的盒子中心。

This belief is being proven by both national data and by Whitestone's numbers, as you can see on our slide number 4. According to a recent Marcus & Millichap report, neighborhood and community centers grew year-over-year asking rents at 4.6% versus 0.1% for power centers. It is no surprise that our higher mix of neighborhood and community centers have allowed us to outperform the peer group's same store net operating income growth, averaging 65 basis points over the last years of outperformance versus the group. Turning to slide 5, you'll see this outperformance is even more impressive, given the amount of capital we're required to drive these results.

正如您在我們的第 4 張幻燈片中看到的那樣，國家數據和 Whitestone 的數據都證明了這一信念。根據 Marcus & Millichap 最近的報告，鄰里和社區中心的租金要價年增 4.6%，而電力中心的租金要價為 0.1%。毫不奇怪，我們的鄰里和社區中心的更高組合使我們能夠超越同行集團的同店淨營業收入增長，在過去幾年中比該集團表現平均高出 65 個基點。翻到幻燈片 5，您會發現，考慮到我們需要大量資金來推動這些結果，這種優異的表現更加令人印象深刻。

Because we acquire correctly configured centers, our redevelopment capital is generally not spent on reconfiguring a center, but rather on areas that drive income. Another key differentiator in terms of driving results is our tenant base. We have over 1,400 tenants that are selected by a leasing team trained to find tenants capable of growing, driving traffic and allowing us to push our same store net operating income higher. Once again, you need a long term operational mindset plus a really strong leasing team in order to build up that tenant base as a key differentiator.

由於我們獲得了正確配置的中心，因此我們的重建資金通常不會用於重新配置中心，而是用於增加收入的領域。推動業績的另一個關鍵區別在於我們的租戶基礎。我們有 1,400 多名租戶，這些租戶是由經過培訓的租賃團隊挑選的，目的是尋找能夠成長、增加客流量並允許我們推高同店淨營業收入的租戶。再次強調，您需要長期的營運思維以及真正強大的租賃團隊，才能將租戶基礎建立為關鍵的差異化因素。

It is because of these differentiators that we believe we should trade at a more attractive cap rate than most of our peers in the retail sector. We are pleased with the progress we have made in terms of market valuation and we believe there is more runway ahead for us as we continue to drive results via these key differentiators. The differentiators became more and more apparent as we consistently drive results and our success is built on a solid strategy and the ability of our leasing, property management and acquisition teams to execute. On the governance front, we continue to make improvements as we recently announced our intent to strengthen and refresh our board of trustees by adding two new, experienced and independent board members who will replace David Taylor and Nandita Berry upon appointment to our board.

正是由於這些差異化因素，我們認為我們應該以比零售業大多數同業更具吸引力的上限利率進行交易。我們對市場估值方面的進展感到高興，並相信，隨著我們繼續透過這些關鍵差異化因素推動業績，我們還有更多的發展空間。隨著我們不斷推動成果，我們的成功建立在堅實的策略以及租賃、物業管理和收購團隊的執行能力之上，差異化優勢變得越來越明顯。在治理方面，我們繼續做出改進，因為我們最近宣布打算透過增加兩名新的、經驗豐富的獨立董事會成員來加強和更新我們的董事會，他們將在被任命為董事會後取代David Taylor 和Nandita Berry 。

We will share more with investors as we move through this process and I'm very thankful to David and Nandita for their efforts in leading the company's leadership changes in early 2022, for their ongoing commitment to do the right thing for shareholders, and for their strong support of our board refreshment initiative. They've served investors well for the last seven years and we are a much better company as a result of their efforts. I'd also like to thank Amy Feng for stepping up as our new independent chair and for Julia Buthman assuming the chair of our nominating and governance committee and leading our board member search efforts. Both Amy and Julia have a strong commitment to grow shareholder value and bring a wealth of valuable experience to our team.

在我們完成這一過程的過程中，我們將與投資者分享更多信息，我非常感謝David 和Nandita 在2022 年初領導公司領導層變動方面所做的努力，感謝他們持續致力於為股東做正確的事情，並感謝他們強烈支持我們的董事會茶點計劃。在過去的七年裡，他們為投資者提供了良好的服務，由於他們的努力，我們成為了一家更好的公司。我還要感謝艾米馮 (Amy Feng) 擔任我們的新任獨立主席，感謝朱莉婭·布斯曼 (Julia Buthman) 擔任我們的提名和治理委員會主席並領導我們的董事會成員搜尋工作。艾米和茱莉亞都堅定地致力於增加股東價值，並為我們的團隊帶來豐富的寶貴經驗。

We look forward to attending the Bank of America Conference in September, and for those of you attending the conference, we hope you'll find time to meet with Whitestone there. And with that, I'll turn the call over to Christine.

我們期待參加 9 月的美國銀行會議，對於參加會議的各位，我們希望您能抽出時間與懷特斯通會面。這樣，我就把電話轉給克莉絲汀。

Good morning, everyone. As Dave mentioned, we remain confident in terms of achieving our 2024 objectives and are on track with our internal monthly and quarterly goals. Occupancy remains high at 93.5%, up 20 basis points from a year ago. Anchor occupancy was 97% and smaller space occupancy was 91.4%.

大家早安。正如 Dave 所提到的，我們對實現 2024 年目標仍然充滿信心，並且正在實現我們的內部月度和季度目標。入住率仍維持在 93.5% 的高位，較去年同期上升 20 個基點。錨泊佔用率為97%，較小空間佔用率為91.4%。

We achieved renewal leasing spreads of 13.9% and new leasing spreads of 33.3% for a combined overall positive leasing spread of 17.5% in the quarter. Our drive to remerchandise continues unabated and it's one of the primary reasons behind our delivering 6.6% same store NOI this quarter. Rather than viewing our record occupancy percentage as simply an indication of the general strength of the business, we view it as an imperative to continue remerchandising. We are continually advancing our quality of revenue initiative, replacing tenants that aren't tracking increased demand from the newer, younger demographic and properly serving the neighborhood.

我們的續租利差為 13.9%，新租賃利差為 33.3%，本季整體正租賃利差為 17.5%。我們的再商品化動力有增無減，這是我們本季在同店 NOI 實現 6.6% 的主要原因之一。我們並沒有將創紀錄的入住率視為業務整體實力的簡單體現，而是將其視為繼續重新銷售的必要條件。我們不斷提高我們的收入品質計劃，更換那些沒有追蹤新的、更年輕的人群需求成長的租戶，並為社區提供適當的服務。

The leasing team is continually challenged to understand existing and prospective tenants business plans, with a focus on understanding how business makes money and how they plan to capture demand growth in the surrounding neighborhood. This remerchandising effort extends well beyond larger remerchandising that we talked about in the past, such as EoS replacing the aging grocery store in the neighborhood or the Pikler replacing the Bed Bath and Beyond. The younger demographic is spending far more on their pets and we've matched that offering with City Vet at Quinlan Crossing in Austin, Central Bark at Paradise Plaza and K9 Creed, both in Arizona. As part of our local franchises, K9 Creed was named the small business of the year by the local chamber of commerce, opening their second location at the Promenade at Fulton.

租賃團隊不斷面臨著了解現有和潛在租戶商業計劃的挑戰，重點是了解企業如何賺錢以及他們計劃如何抓住週邊社區的需求成長。這種再行銷工作遠遠超出了我們過去討論過的更大規模的再行銷，例如 EoS 取代了附近老化的雜貨店，或者 Pikler 取代了 Bed Bath 等。年輕人在寵物上的花費要多得多，我們在奧斯汀 Quinlan Crossing 的 City Vet、Paradise Plaza 的 Central Bark 和亞利桑那州的 K9 Creed 提供了相應的服務。作為我們當地特許經營的一部分，K9 Creed 被當地商會評為年度小型企業，並在富爾頓的 Promenade 開設了第二家分店。

We celebrate our local entrepreneurs and welcome the opportunity to participate in their success. We're also seeing the younger generation spend significantly more on self-care and well-being – massage, yoga, beauty products, Pilates and more. One of the reasons these businesses are often well tied in the local demand is that they have a millennial or Gen Z operators operating their third, fourth or fifth franchise and bringing in more sophisticated marketing techniques and the ability to meet demand with lower capital outlays. We've recently brought in The NOW Massage at Lakeside Market in Dallas, a perfect example of this.

我們慶祝當地企業家，並歡迎有機會參與他們的成功。我們也看到年輕一代在自我保健和健康方面的支出顯著增加 - 按摩、瑜伽、美容產品、普拉提等。這些企業往往與當地需求密切相關的原因之一是，他們有千禧世代或Z 世代業者經營其第三、第四或第五個特許經營權，並引入更複雜的行銷技術以及以較低資本支出滿足需求的能力。我們最近在達拉斯湖濱市場引入了 The NOW Massage，這就是一個完美的例子。

They've done a fantastic job creating a natural Zen environment for their customers, but importantly, they've reduced their cost and, in order to do so, divide the space differently than used to be done in the past by using curtains rather than walls. They are often more of an example of newer operators with strong long term business plans that know how to develop and use their capital appropriately to make money. Week in and week out, we are constantly having our leasing team sharing their successes with one another. This is leveraging each other's talents and experiences not confined to how the team finds new prospects.

他們為客戶創造了一個自然的禪宗環境，做得非常出色，但重要的是，他們降低了成本，為了做到這一點，他們使用窗簾而不是過去的方式來劃分空間。它們往往更多是具有強大長期業務計劃的新運營商的例子，知道如何適當地開發和使用其資本來賺錢。一周又一周，我們的租賃團隊不斷地互相分享他們的成功。這是利用彼此的才能和經驗，而不僅限於團隊如何尋找新的前景。

They share their experience in technology and tools they utilize to assess neighborhood demand and how they evaluate businesses and lessons learned from other centers that are evolving. Over the last few years, we've seen a number of competitors brand themselves with a grocery anchor or a Sunbelt sticker. We believe it's critical for investors to understand that the growth model we build requires far more than shifting an acquisition strategy to draw investors' attention. The centers we've acquired are well positioned to capture neighborhood demands, and they're configured correctly to attract high growth, service oriented businesses.

他們分享了他們用來評估社區需求的技術和工具的經驗，以及他們如何評估企業以及從其他正在發展的中心學到的經驗教訓。在過去的幾年裡，我們看到許多競爭對手都用雜貨店錨或陽光地帶貼紙來建立自己的品牌。我們認為，投資人必須了解，我們建構的成長模式需要的不僅僅是改變收購策略來吸引投資人的注意。我們收購的中心能夠很好地滿足社區需求，而且它們的配置正確，可以吸引高成長、以服務為導向的企業。

However, leasing team expertise is the reason we're able to properly curate centers, and it's critical to understand how interdependent our differentiators are and how that allows us to deliver consistent results. I'll also expand on our ability to outperform with less capital. The biggest part of the capital difference is the redevelopment capital. Redevelopment capital is often a critical component of driving results.

然而，租賃團隊的專業知識是我們能夠正確管理中心的原因，了解我們的差異化因素如何相互依賴以及如何使我們能夠提供一致的結果至關重要。我還將擴展我們以更少的資本實現卓越表現的能力。資本差異中最大的部分是重建資本。再開發資本通常是推動績效的關鍵組成部分。

However, the key is to be tuned into the neighborhood demand, allowing that demand to drive the actions you take. We project demand when we acquire the properties and we continually maintain a pulse on that demand in order to ensure the center is keeping up with it. This is vital for leasing agents to determine the right tenant and for when to apply redevelopment capital. We also factor in the timing of lease expirations both in our acquisition analysis and in our application of redevelopment capital.

然而，關鍵是要適應社區的需求，讓這種需求驅動你採取的行動。當我們收購房產時，我們會預測需求，並持續關注該需求的脈搏，以確保中心能夠跟上需求。這對於租賃代理商確定合適的租戶以及何時申請重建資金至關重要。我們也在收購分析和再開發資本的應用中考慮了租賃到期的時間。

Investors may have seen recent news on Kroger's proposed acquisition of Albertsons stores that may be divested to C&S. We have three Safeway stores on the list, Market Street, Pinnacle of Scottsdale and Anthem Marketplace in our Phoenix market, plus another two shadow anchored centers, Arcadia Towne Center and Fountain Square, also in our Phoenix market. These are well performing stores with an average grocery sales of approximately $500 per square foot and a three-mile household income of approximately $124,000. If the merger goes through, we believe C&S will be a strong operator.

投資者可能已經看到了克羅格 (Kroger) 擬收購艾伯森 (Albertsons) 商店的最新消息，該商店可能會出售給 C&S。我們的名單上有 3 家 Safeway 商店，分別是 Market Street、Pinnacle of Scottsdale 和鳳凰城市場的 Anthem Marketplace，此外還有另外兩個影子中心，Arcadia Towne Center 和 Fountain Square，也在我們的鳳凰城市場。這些商店業績良好，平均雜貨銷售額約為每平方英尺 500 美元，三英里範圍內的家庭收入約為 124,000 美元。如果合併成功，我們相信 C&S 將成為一家強大的營運商。

As always, the key is that these centers are well anchored by surrounding neighborhoods. We'll keep investors updated as we learn more. If we look back over the last ten years, the strongest quarters in terms of total lease value signed were the fourth quarters of 2021, 2022 and 2023. The most recent quarter was the next highest on the list with nearly $37 million signed in lease value. While this is impressive and certainly a sign that we're on the right track, my biggest reason for wanting to thank the leasing team and the operations team for delivering space to tenants is their ability to learn from one another and continually sweat out the details necessary to ensure the long term success of this business. We've got a busy second half ahead, but we also have the right environment and the right team to deliver. It's my thanks to that team that we've been able to deliver so far. Scott?

像往常一樣，關鍵是這些中心與周圍社區有著良好的聯繫。當我們了解更多資訊時，我們將及時向投資者通報最新情況。如果我們回顧過去十年，就簽署的租賃總額而言最強勁的季度是 2021 年、2022 年和 2023 年的第四季。最近一個季度的簽約租賃價值接近 3,700 萬美元，位居榜單第二位。雖然這令人印象深刻，並且肯定表明我們走在正確的軌道上，但我要感謝租賃團隊和營運團隊為租戶提供空間的最大原因是他們能夠互相學習並不斷努力解決細節確保業務的長期成功所必需的。我們的下半場即將到來，但我們也擁有合適的環境和合適的團隊來交付。我要感謝迄今為止我們能夠交付的團隊。史考特？

Thank you, Christine. And good morning. We were pleased to deliver $0.24 of core FFO for the quarter. As Dave and Christine discussed, this was a very strong quarter led by strong leasing efforts. Our original and our current forecast anticipates that we will increase FFO in the second half of the year, especially the fourth quarter, with G&A reductions, percent of sales clauses kicking in more heavily in the fourth quarter, and leasing delivering a fourth quarter similar to the last three years. Pursuant with our delivering same store NOI growth of 6.6% this quarter, we raised the full year same store NOI guidance range to between 3% and 4.5%, raising it 0.5% both on the bottom and the top end of the range.

謝謝你，克里斯汀。早安.我們很高興在本季度交付了 0.24 美元的核心 FFO。正如戴夫和克里斯汀所討論的，在強勁的租賃業務的推動下，這是一個非常強勁的季度。我們最初和目前的預測預計，我們將在今年下半年增加 FFO，尤其是第四季度，其中 G&A 減少，銷售條款百分比在第四季度更加嚴格，並且第四季度的租賃業績與過去三年。根據我們本季實現的同店 NOI 成長 6.6%，我們將全年同店 NOI 指引範圍上調至 3% 至 4.5% 之間，該範圍的底部和頂部均提高了 0.5%。

On the debt side, we financed $56 million of 6.2% secured debt maturing in 2031. In essence, this was laddering out our secured debt we have coming due in the second half of this year. We will keep an eye on laddering out a bit more of our revolver debt. Currently, we have 13% of our debt on variable rates and the revolver matures in 2026, not including two six-month extension options.

在債務方面，我們為 2031 年到期的 6.2% 擔保債務融資了 5,600 萬美元。從本質上講，這是在逐步償還今年下半年到期的擔保債務。我們將密切關注更多的左輪手槍債務。目前，我們 13% 的債務採用浮動利率，左輪手槍將於 2026 年到期，不包括兩個六個月的延期選項。

Looking at our core FFO walk on slide 11, we reiterated guidance and updated the forecast in terms of how we get there. Non-same store NOI growth increased and, in conjunction, interest expense also increased. We intend to continue balancing out our acquisitions and dispositions, and the timing will impact these two contributors, but to the extent one increases, we should see the other approximately balance it out. Our goal is to make sure that our underlying growth engine becomes more and more visible to investors.

看看幻燈片 11 上我們的核心 FFO 演練，我們重申了指導意見，並更新了我們如何實現這一目標的預測。非同店 NOI 成長增加，利息支出也隨之增加。我們打算繼續平衡我們的收購和處置，時機將影響這兩個貢獻者，但在一個增加的程度上，我們應該看到另一個大致平衡。我們的目標是確保我們的潛在成長引擎對投資者越來越明顯。

We will do this both by eliminating noise and by continuing to drive to drive same store NOI growth in order to deliver bottom line growth. With that, we will keep our comments brief today, and I will open the line for questions.

我們將透過消除噪音和繼續推動同店 NOI 成長來實現這一目標，以實現利潤成長。因此，我們今天的評論將保持簡短，我將開通提問熱線。

(Operator Instructions) Anthony Hau, Truist Securities.

（操作員指示）Anthony Hau，Truist Securities。

In the rental trend chart on page 7 in the presentation, rent growth for San Antonio and Austin moderated sharply. And then you see an uptick for Dallas, right? So, just curious, what are you guys seeing on the ground today for those markets?

在簡報第 7 頁的租金趨勢圖中，聖安東尼奧和奧斯汀的租金成長急劇放緩。然後你會看到達拉斯的上漲，對嗎？那麼，只是好奇，你們今天在這些市場上看到了什麼？

We're seeing strength in all of our markets, Anthony, still. It's just a matter of what leases are turning when and the size space. So I don't see a real shift in a negative way. In fact, I'm seeing it still continuing on track with where our expectations are, and that's across all markets.

安東尼，我們仍然看到所有市場的實力。這只是租約何時到期以及空間大小的問題。所以我沒有看到真正的負面轉變。事實上，我看到它仍在繼續符合我們的預期，而且在所有市場上都是如此。

And quite frankly, the difficulty is some of our markets are getting to full occupancy. That's why we've continued to work our remerchandising efforts to strengthen the base of the growth.

坦白說，困難在於我們的一些市場正在全面佔領。這就是為什麼我們繼續努力進行再銷售，以鞏固成長的基礎。

You're hearing news that a lot – some restaurant owners, like McDonald's, are struggling a little bit. Are there any restaurant tenants that's on your watch list right now?

你會聽到很多消息——一些餐館老闆，比如麥當勞，正在陷入困境。目前您的觀察名單上有餐廳租戶嗎？

Not on our watch list right now. What we're finding, and I think this has been talked about quite a bit, is that fast food is starting to meet the same pricing as fast casual. And so, people are opting for a choice of sitting down and having a good meal versus what would be something that would be maybe less desirable, like eating a hamburger in the car.

目前不在我們的觀察名單上。我們發現，我認為這已經被討論了很多，快餐正開始達到與快餐休閒食品相同的價格。因此，人們選擇坐下來吃一頓美餐，而不是做一些可能不太理想的事情，例如在車上吃漢堡。

Mitch Germain, Citizens JMP Securities.

米奇·傑曼 (Mitch Germain)，JMP 證券公民。

It appears, based on your same store guidance, you're kind of looking at a little bit of a deceleration in the back part of the year. Just talk about kind of what the expectation is there.

根據你們同一家店的指導，看來你們在今年下半年會看到一些減速。只是談談期望是什麼。

This is Scott. We're still looking at sequential same store growth, but I think that if you were to look at the first half of the year, same store growth, and compare that to the second half of the year, compared to 2023, the second half will be a little bit lower than the first half of the year was. You may recall in the second half last year, we had a quarter that was a little bit lower. So that's one reason why the second quarter this year was a little higher.

這是斯科特。我們仍在關注同店環比增長，但我認為，如果你看一下今年上半年的同店增長，並將其與下半年進行比較，那麼與 2023 年相比，下半年會比上半年稍微低一些。您可能還記得去年下半年，我們有一個季度的情況稍微低一些。這就是今年第二季略高的原因之一。

It's Dave. And as you saw, we did increase our same store guidance for the year. To Scott's point, I think we're very pleased with the performance a bit above our original guidance. We moved it up on the bottom and top end, and I think pleased with the performance of the portfolio.

是戴夫。正如您所看到的，我們確實增加了今年的同店指導。對於斯科特的觀點，我認為我們對略高於我們最初指導的表現感到非常滿意。我們將其從底部和頂部向上移動，我認為對投資組合的表現感到滿意。

You didn't provide an update on Pillarstone. I know a lot of what's happening there is a little bit out of your control. I know some of this is contemplated in your guidance right now. Anything of note happening there?

您沒有提供有關 Pillarstone 的更新。我知道那裡發生的很多事情都有點超出你的控制範圍。我知道您現在的指導中已經考慮到了其中的一些內容。那裡發生了什麼值得注意的事嗎？

Mitch, Dave again. A lot happening. I think we mentioned we're really in the collection phase for our redemption, working our way through that and expecting proceeds as we go through that process. I think we communicated earlier on we had about $13 million of expected proceeds in our guidance this year, and that no change to that. And we're working to collect those funds through a disciplined, organized process.

米奇，戴夫又來了。發生了很多事情。我想我們提到過，我們確實處於贖回的收集階段，正在努力完成這一過程，並期望在整個過程中獲得收益。我想我們早些時候曾表示，今年的預期收益約為 1300 萬美元，這一點沒有改變。我們正在努力透過有紀律、有組織的流程來籌集這些資金。

Are assets from the Pillarstone entity for sale?

Pillarstone 實體的資產是否可供出售？

They are. As part of the BK, obviously, we're working through a plan of reorganization. Right now, we understand they have about $40 million of contracts in place for three of the assets, and we're obviously working to get all or some of the assets liquidated in order to meet Whitestone's redemption.

他們是。顯然，作為 BK 的一部分，我們正在製定重組計劃。目前，我們了解到他們已經為其中三項資產簽訂了價值約 4000 萬美元的合同，而且我們顯然正在努力清算全部或部分資產，以滿足白石的贖回要求。

Last from me. Christine, fourth quarter last year, obviously, you had a pretty meaningful increase in occupancy quarter to quarter from 3Q. You're starting at a little bit of a higher point this year, but obviously your comments reference the fact that the back part of the year are the more seasonally active. So where do you think is a comfortable occupancy level for this portfolio to start to perform a little bit more consistently?

最後是我的。克里斯汀，去年第四季度，顯然，與第三季度相比，每個季度的入住率都有相當大的成長。今年你的起點有點高，但顯然你的評論提到了這樣一個事實，即今年下半年的季節性更加活躍。那麼，您認為該投資組合的舒適入住率在什麼水準才能開始表現得更一致呢？

Like I said, there's an active remerchandising effort because I think there is a profitability that can be achieved with that. But we're still looking at 93.8 to 94.8. But I'm quite confident that we can get this portfolio in a good place at the end of the year.

就像我說的，我們正在積極進行再銷售工作，因為我認為這樣做可以實現盈利。但我們仍在關注 93.8 至 94.8。但我非常有信心我們可以在年底將這個投資組合放在一個好的位置。

Gaurav Mehta, Alliance Global Partners.

Gaurav Mehta，聯盟全球合作夥伴。

I wanted to ask you on your G&A guidance. For the second half of 2024, does your guidance include any non-recurring items within the G&A?

我想詢問您的 G&A 指導。對於 2024 年下半年，您的指導是否包括 G&A 中的任何非經常性項目？

In the first half of the year, we had proxy defense cost of around $1.8 million. And that's the majority of the increase in G&A. In the second half, we expect to be a little bit more normal. Some of the legal fees were front loaded into the first half of the year associated with the bankruptcy and other legal matters. So we do expect a more normalized G&A in the second half of the year.

今年上半年，我們的代理辯護成本約為 180 萬美元。這是一般管理費用成長的大部分。下半年，我們預計會更正常一些。一些與破產和其他法律事務相關的法律費用已提前計入上半年。因此，我們確實預期下半年的一般管理費用將更加正常化。

Second question I had was on the real estate property taxes, which were lower in second quarter. How should we expect about real estate property taxes for the second half of 2024?

我的第二個問題是關於房地產稅，第二季較低。對於2024年下半年的房地產稅我們該如何預期？

In the State of Texas, there's a long process to dispute and litigate property taxes, and you often get tax refunds. You don't know when you'll get those. So we had a few more tax refunds in the second quarter than we normally would. So I would expect property taxes to normalize and be closer to where we were in the first quarter for the second half of the year. And the reason the second quarter is so much lower is we've had a number of favorable settlements on properties in Texas.

在德州，財產稅爭議和訴訟的程序很長，而且您經常可以獲得退稅。你不知道什麼時候才能得到這些。因此，我們第二季的退稅比平常多了一些。因此，我預計財產稅將正常化，並接近今年下半年第一季的水平。第二季價格大幅下降的原因是我們在德州的房產上達成了許多有利的和解協議。

Maybe lastly on the transactions, I think on the last call, you had talked about maybe selling $25 million of properties in second quarter. Was there any update on those expected dispositions?

也許最後是關於交易，我想在上次電話會議上，您談到可能在第二季出售 2500 萬美元的房產。這些預期處置有任何更新嗎？

It's Dave. Yes, our recycling efforts are on track. I think in the second quarter, we closed on a couple acquisitions, and I think we closed on one disposition right before the second quarter. We do have a couple assets still in the pipeline and to close in the balance of the year. I think we've done about $100 million in acquisitions over the last couple of years and $85 million of dispositions.

是戴夫。是的，我們的回收工作正步入正軌。我認為在第二季度，我們完成了幾項收購，我認為我們在第二季度之前完成了一項處置。我們確實還有一些資產仍在籌備中，並將在今年剩餘時間內完成。我認為過去幾年我們已經完成了大約 1 億美元的收購和 8500 萬美元的處置。

Our plan is to continue to balance those. So we've probably got another $20 million to $30 million of dispositions coming in the balance of the year, and those are going well. We're continuing to be able to buy assets where we think there's significantly more upside and an initial day one spread as well.

我們的計劃是繼續平衡這些。因此，今年餘下的時間裡，我們可能還會有另外 2,000 萬至 3,000 萬美元的處置，而且進展順利。我們將繼續能夠購買我們認為有明顯更大上漲空間和初始第一天價差的資產。

(Operator Instructions) John Massocca, B. Riley Securities.

（操作員指示）John Massocca，B. Riley Securities。

I'm sorry if I missed this earlier in the call, but I'm splitting hairs a little bit. But the interest expense expectation increased versus kind of prior guidance, what's the driver of that? Is it anything to do with disposition timing versus what your expectations were last quarter, or was it just execution on the mortgage you recently did? Just trying to get a little color on the change in that guidance outlook?

如果我之前在通話中錯過了這一點，我很抱歉，但我有點吹毛求疵。但與先前的指導相比，利息支出預期增加，其驅動因素是什麼？這是否與處置時間與您上季度的預期有關，或者只是您最近執行的抵押貸款的執行？只是想了解指導前景的變化嗎？

No, the majority of the increase in the interest expense guidance is we have a recycling plan where the plan is to be capital neutral. But in the first half of the year and a little bit into the second half of the year, the acquisitions are outpacing the dispositions. And so with that, you just have a little bit higher NOI and a little bit higher interest expense. And so, the bottom line impact to FFO is going to be virtually nothing. Maybe $20 million to $25 million would be the amount that we're ahead on acquisitions versus dispositions for the year.

不，利息支出指導的大部分增加是我們有一個回收計劃，該計劃是資本中立的。但在今年上半年和下半年，收購的速度超過了處置的速度。因此，您的 NOI 會稍微高一點，利息支出也會高一點。因此，對 FFO 的底線影響幾乎為零。也許 2000 萬至 2500 萬美元是我們今年在收購與處置方面領先的金額。

In the guidance last quarter on 1Q, was the anticipation that there would have been earlier timing on dispositions then?

在上一季第一季的指引中，是否預期當時會更早進行處置？

Yes. Yeah, it's difficult to predict the dates of these things.

是的。是的，很難預測這些事情的日期。

And I guess what kind of is being assumed from a variable interest expense perspective, just given all the volatility we're seeing, I don't know when that was determined. It seems like any given week that can be very different, but just kind of interested in the timeframe of when you set that element of the interest expense expectation.

我猜想從可變利息支出的角度來看，假設的是哪種情況，考慮到我們所看到的所有波動性，我不知道這是何時確定的。似乎任何給定的一周都可能有很大不同，但只是對您設定利息支出預期要素的時間範圍感興趣。

Well, we're down to 13% variable interest rate as of the end of the quarter, the second quarter, and we take a look at the one-month SOFR curve going out through the end of the year. And high 6s, low 7s would be the range that we're looking at for the balance of the year, at least in this quarter's forecast.

嗯，截至第二季末，我們將可變利率降至 13%，我們來看看截至今年年底的一個月 SOFR 曲線。高 6 分、低 7 分將是我們今年剩餘時間的範圍，至少在本季的預測中是如此。

Switching gears to kind of operational stuff, I know there's been a lot of talk on calls over the last couple of quarters about the impact of higher interest rates on kind of low income consumers versus high income consumers. As you look at your own portfolio, to the extent you have exposure to those different kind of income buckets, are you seeing any kind of difference in terms of your ability to push rent at properties that are maybe a little closer to lower income consumers versus higher income consumers? And does that shape kind of how you're thinking about your capital recycling plan?

轉向營運方面，我知道過去幾季有很多關於高利率對低收入消費者和高收入消費者的影響的電話討論。當您審視自己的投資組合時，就您接觸到這些不同類型的收入類別而言，您是否發現在可能更接近低收入消費者的房產與低收入消費者的房產推高租金的能力方面有任何差異？這是否影響了您對資本回收計劃的思考？

It's a good question. I think a couple of things. That's why we've positioned most of our acquisitions and our properties in high HHIs and in those higher incomes where we see those growth opportunities really come from job growth. So we've been very fortunate that we've been able to see the upside of that growth as well with those incomes. Truly, this has been a concerning thing to see what's happening with the lower income consumers.

這是一個好問題。我認為有幾件事。這就是為什麼我們將大部分收購和房產定位在高 HHI 和高收入地區，我們認為這些成長機會真正來自就業成長。因此，我們非常幸運，我們能夠看到這種成長以及這些收入的好處。確實，低收入消費者的情況令人擔憂。

We don't have a lot of exposure there. Where we do on some of those properties, they're still not really on the lower end. They're about mid-range. So, again, I haven't seen anything as of yet. But that being said, you feel bad for what's happening to these people and it's very unfortunate. So, hopefully, things will balance out towards the end of the year for everybody in a good way. But like I said, we don't have a lot of exposure in that area. In fact, it's very minimal.

我們在那裡沒有太多的曝光。我們在其中一些房產上所做的工作，它們仍然不是真正處於低端。他們大約是中檔。所以，再說一次，我到目前為止還沒有看到任何東西。但話雖這麼說，你對這些人發生的事情感到難過，這是非常不幸的。因此，希望到年底，一切都會以一種良好的方式平衡，對每個人來說都是如此。但就像我說的，我們在該領域沒有太多的曝光。事實上，這是非常小的。

So as you look at kind of capital recycle, is the thought process to continue to move up that HHI curve?

因此，當您考慮資本回收類型時，思考過程是否會繼續沿著 HHI 曲線向上移動？

John, it's Dave. It is. Part of our recycling is just – the biggest part is the ability to add value through the new acquisition. But we have recycled with a little bit higher HHIs and also higher ABRs. So continuing to focus on where we think the greatest opportunity is.

約翰，這是戴夫。這是。我們回收的一部分只是——最大的部分是透過新收購增加價值的能力。但我們回收了更高的 HHI 和更高的 ABR。因此，繼續關注我們認為最好的機會所在。

Thank you. As there are no further questions, I would now hand the conference over to Dave Holman, CEO, for his closing comments.

謝謝。由於沒有其他問題，我現在將會議交給執行長戴夫霍爾曼 (Dave Holman)，聽取他的結束語。

Thank you. Thanks, everyone, for joining us this morning. At Whitestone, we're pleased with our progress in the second quarter and really look forward to performing for the balance of the year. We will be out among investors in the fall and would love to interact with any of you that would like to, so please reach out to us. Have a great day.

謝謝。謝謝大家今天早上加入我們。在白石，我們對第二季的進展感到滿意，並非常期待今年剩餘時間的表現。我們將於秋季與投資者見面，很樂意與任何願意的人互動，所以請與我們聯繫。祝你有美好的一天。

Thank you. The conference of Whitestone REIT has now concluded. Thank you for your participation. You may now disconnect your lines.

謝謝。白石房地產投資信託基金的會議現已結束。感謝您的參與。現在您可以斷開線路。