Whitestone REIT (WSR) 2025 Q1 法說會逐字稿

Ladies and gentlemen, greetings and welcome to the Whitestone REIT first-quarter 2025 earnings conference call. (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，大家好，歡迎參加 Whitestone REIT 2025 年第一季財報電話會議。（操作員指示）提醒一下，本次會議正在錄音。現在我很高興向大家介紹主持人、投資者關係總監 David Mordy。請繼續。

Good morning, and thank you for joining Whitestone REIT's first-quarter 2025 earnings conference call. Joining me on today's call are Dave Holeman, Chief Executive Officer; Christine Mastandrea, President and Chief Operating Officer; and Scott Hogan, Chief Financial Officer.

早安，感謝您參加 Whitestone REIT 2025 年第一季財報電話會議。參加今天電話會議的還有執行長 Dave Holeman；總裁兼營運長 Christine Mastandrea；以及財務長 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.

請注意，本次電話會議中所做的一些陳述並非歷史性陳述，可能被視為前瞻性陳述。由於多種風險、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, May 1, 2025.

請參閱本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 最新的 10-Q 表和 10-K 表，以詳細了解這些因素。除了承認本次電話會議可能會在一段時間內進行網路直播之外，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在截至今天（2025 年 5 月 1 日）時準確。

The company undertakes no obligation to update this information. Whitestone's 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.

該公司不承擔更新該資訊的義務。Whitestone 的獲利新聞稿和補充營運和財務資料包已提交給美國證券交易委員會 (SEC)，可在我們網站的投資者關係部分查閱。

We published first quarter 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.

我們昨天下午在我們的網站上發布了第一季的幻燈片，重點介紹了今天要討論的主題。現在我將把電話轉給我們的執行長戴夫霍爾曼 (Dave Holeman)。

Good morning. For a lot of investors looking at a lot of companies, they may not view the first quarter as overly indicative of the future as it was entirely pre-tariff announcement. We believe there are a number of reasons to look at Whitestone's first quarter results and view it exactly as the type of quarter you should expect.

早安.對於許多關注多家公司的投資者來說，他們可能不會認為第一季的數據能夠過度預示未來，因為這完全是關稅宣布之前的水平。我們相信，有許多理由來審視 Whitestone 第一季的業績，並將其視為您應該期待的一個季度類型。

This morning, we are reiterating our core FFO guidance, and I'd like to walk you through the reasons why we believe this quarter very much represents what investors will see in terms of continued performance from Whitestone. There are three primary reasons.

今天上午，我們重申了我們的核心 FFO 指導，我想向大家介紹為什麼我們認為本季非常能代表投資者對 Whitestone 持續表現的看法。主要有三個原因。

First, our redevelopment efforts are translating into same-store net operating income growth exactly as we expected and exactly in the way we're anticipating our ongoing redevelopment will translate into financial results. The capital is modest, $20 million to $30 million over the next few years, but we anticipate our investments will deliver strong results.

首先，我們的重建工作正轉化為同店淨營業收入的成長，正如我們預期的那樣，也正如我們預期我們正在進行的重建將轉化為財務業績的方式一樣。資本不多，未來幾年將達到 2000 萬至 3000 萬美元，但我們預計我們的投資將帶來豐厚的回報。

Second, as we've discussed on the last earnings call, Whitestone is designed to benefit as change occurs. This design means we're capable of performing better in various economic cycles. And today, we'll highlight how our business model and the actions we've taken over the past three years provide both accelerated growth and greater durability of cash flows if economic conditions worsen.

其次，正如我們在上次收益電話會議上所討論的那樣，Whitestone 旨在隨著變化而受益。這種設計意味著我們能夠在各種經濟週期中表現得更好。今天，我們將重點介紹我們的商業模式以及過去三年來採取的行動如何在經濟狀況惡化時實現加速成長和增強現金流的持久性。

And third, our properties are at the heart of the reshoring dynamic that is occurring right now. We strongly believe reshoring isn't really a matter of whether tariffs succeed or not, trillions of dollars of Chinese manufacturing no longer has a young labor force needed to operate effectively and globalization is breaking down.

第三，我們的資產是目前回流動態的核心。我們堅信，回流實際上並不是關稅是否成功的問題，數兆美元的中國製造業不再擁有有效運作所需的年輕勞動力，全球化正在崩潰。

That translates into TSMC's new operations in Phoenix and Apple's announcement of a 250,000 square foot manufacturing facility in Houston. Those investments transform the communities around them, and we benefit as long as we ensure that our centers remain anchored to the community and adapt in tandem. We are confident there is more reshoring on the horizon, and our strategy and operational model is set up to benefit from that.

這意味著台積電將在鳳凰城設立新工廠，而蘋果則宣布將在休士頓設立一座佔地 25 萬平方英尺的製造工廠。這些投資改變了周圍的社區，只要我們確保我們的中心紮根於社區並同步適應，我們就會受益。我們相信，未來將會出現更多的回流，我們的策略和營運模式也將從中受益。

In 2024, we spent roughly $8 million in capital above the 2023 level, and this translated into an approximate 1% lift in same-store NOI growth that we delivered this quarter. Of the six redevelopment centers shown on slides 20 and 21, Williams Trace was the vanguard in terms of our efforts and Windsor Park is well underway.

2024 年，我們花費的資本比 2023 年的水準高出約 800 萬美元，這意味著本季同店淨營業利潤成長率將提高約 1%。在第 20 和 21 張幻燈片中展示的六個重建中心中，威廉斯特雷斯 (Williams Trace) 是我們努力的先鋒，而溫莎公園 (Windsor Park) 的重建工作也進展順利。

We've issued press releases on redevelopment efforts at Lion Square, Terravita and Davenport. And collectively, those centers are anticipated to create up to 100 basis points of same-store NOI growth lift in 2026, '27 and '28. So here's what we delivered for the quarter.

我們發布了有關獅子廣場、Terravita 和 Davenport 重建工作的新聞稿。預計這些中心將在 2026 年、2027 年和 2028 年共同創造高達 100 個基點的同店淨營業利潤成長。以下是我們本季交付的成果。

Core FFO per share of $0.25 for the quarter, up 4.2% versus Q1 '24. Same-store net operating income growth of 4.8%, near the top of our forecasted range. Straight line leasing spreads of 20.3%, our 12th consecutive quarter with leasing spreads in excess of 17%.

本季核心 FFO 每股 0.25 美元，較 24 年第一季成長 4.2%。同店淨營業收入成長4.8%，接近我們預測範圍的上限。直線租賃利差為 20.3%，這是我們連續第 12 季的租賃利差超過 17%。

And we raised our annual net effective ABR per square foot 4% over Q1 '24. All of this fits perfectly within our longer term expectation of 4% to 6% organic core FFO per share growth driven by 3% to 5% same-store NOI growth.

與 24 年第一季相比，我們將每平方英尺的年度淨有效 ABR 提高了 4%。所有這些都完全符合我們的長期預期，由 3% 至 5% 的同店 NOI 成長推動每股有機核心 FFO 成長 4% 至 6%。

As a reminder, that same-store NOI growth breaks down to 2% from contractual escalators, 1% to 2% from new and renewal leasing and up to 1% from redevelopment. I'm going to have Christine talk about what we've done organically that provides greater durability of cash flows, but I wanted to touch briefly on our acquisition and disposition activity.

提醒一下，同店 NOI 成長分解為來自合約自動調整的 2%、來自新租賃和續約的 1% 至 2% 以及來自重建的 1%。我將讓克里斯汀談談我們為提高現金流的持久性而採取的有機措施，但我想簡單談談我們的收購和處置活動。

In 2020, we were one of the top-performing retail REITs as measured by year-over-year same-store NOI performance or as measured by bad debt levels. Since 2020, we have sold 11 properties and acquired Lake Woodlands, Arcadia, Garden Oaks, Scottsdale Commons, two non-owned multi-tenant pads at Dana Park and a non-owned pad site at our Anderson Arbor property in Austin.

2020 年，無論以同比同店淨營業利潤表現或以壞帳水準衡量，我們都是表現最好的零售房地產投資信託基金 (REIT) 之一。自 2020 年以來，我們已出售 11 處房產，並收購了 Lake Woodlands、Arcadia、Garden Oaks、Scottsdale Commons、位於 Dana Park 的兩座非自有多租戶地塊以及位於奧斯汀 Anderson Arbor 房產的一處非自有地塊。

One obvious benefit from our capital recycling has been to raise the average household income level and ABR for our properties. But what is more important is that we have a greater degree of confidence about the growth of the communities surrounding our centers and our ability to continue matching tenants to that growing demand.

我們的資本循環的一個明顯好處是提高了我們房產的平均家庭收入水準和 ABR。但更重要的是，我們對中心週邊社區的發展以及我們繼續為租戶匹配不斷增長的需求的能力更有信心。

That science of connecting tenants to demand is the key to performing in any economic environment, and we're always eager to walk investors through exactly how we do that. While the overall macroeconomic environment has uncertainty to it right now, the dynamics in our markets, especially for service-based businesses are much more favorable.

將租戶與需求聯繫起來的科學是任何經濟環境下成功的關鍵，我們始終渴望向投資者詳細講解我們是如何做到這一點的。雖然目前整體宏觀經濟環境存在不確定性，但我們市場的動​​態，特別是服務型企業的動態要有利得多。

Green Street's population forecast for our footprint is 50 to 70 basis points higher versus the national average and the job growth CAGR is forecasted to run 40 basis points above the rest of the nation. According to CommercialEdge, Phoenix, our largest market, leads the country in terms of industrial construction underway.

Green Street 對我們地區的人口預測比全國平均高出 50 至 70 個基點，就業成長複合年增長率預計比全國其他地區高出 40 個基點。根據 CommercialEdge 報道，我們最大的市場鳳凰城在工業建設方面處於全國領先地位。

All of these trends are in line with what we've seen over the past decade, and it allows demand to recover much more quickly from any shocks to the system. We pay close attention to the current environment in terms of the decisions we make.

所有這些趨勢都與我們過去十年所看到的情況一致，並且它使需求能夠從系統衝擊中更快地恢復。我們在做出決定時密切注意當前環境。

But we are making decisions with a multiyear horizon in mind, and we are very bullish on the future of service-based businesses in the Sun Belt. We're looking forward to seeing many of you at REITweek in June. Please reach out to our Investor Relations if you will be at the conference and would like to spend some time with management. And I'll now turn the call over to Christine.

但我們做決定時會考慮多年的前景，我們對陽光地帶服務型企業的未來非常樂觀。我們期待在六月的 REITweek 上見到你們。如果您將參加會議並希望與管理層共度一段時間，請聯絡我們的投資者關係部門。現在我將把電話轉給克里斯汀。

Good morning, everyone. We delivered a very strong quarter with $31 million of total lease value signed. It is the highest first quarter amount we've ever signed with 40% over the average of the last decade. Leasing spreads were 22.6% for new leases and 19.9% for renewals, giving us a combined leasing spreads of 20.3% for the quarter. This activity, combined with our previous strong quarters translated into a 4.8% same-store NOI growth, which is the key to our delivering our targeted earnings growth.

大家早安。本季我們的表現非常強勁，簽訂的租賃總價值為 3,100 萬美元。這是我們簽署的第一季最高金額，比過去十年的平均值高出 40%。新租約的租賃利差為 22.6%，續租的租賃利差為 19.9%，本季的綜合租賃利差為 20.3%。這項活動與我們之前幾季的強勁表現相結合，帶來了 4.8% 的同店淨利潤成長，這是我們實現目標獲利成長的關鍵。

As we discussed on the fourth quarter call, our shop space at 77% of ABR versus the peer average of 50% provides greater flexibility to adapt to surrounding demand, more flexibility in terms of the mix of businesses that we can accommodate and is more attractive to a sophisticated multichannel services business.

正如我們在第四季度電話會議上所討論的那樣，我們的店鋪面積佔 ABR 的 77%，而同行的平均水平為 50%，這為適應周圍需求提供了更大的靈活性，在我們可以容納的業務組合方面具有更大的靈活性，並且對複雜的多渠道服務業務更具吸引力。

Complementing the physical design advantage of high-value shop space is our ability to utilize local knowledge and relevant data from Esri and Placer.ai to constantly pay attention to the demand drivers that translate into the success for the businesses populating our centers.

除了高價值商店空間的實體設計優勢之外，我們還能夠利用來自 Esri 和 Placer.ai 的本地知識和相關數據，不斷關注轉化為我們中心企業成功的需求驅動因素。

Matching the tenants to the community not only provides Whitestone the opportunity to deliver peer-leading growth, it provides better downside protection in three distinct ways. First, relying strictly on anchor tenants in order to drive success for shop space tenants, exposes shop space tenants unnecessarily to the anchor. Rather, we ensure that all tenants are connected to the primary demand needs driven by the community and accordingly limit the risk presented by roping our climbers together.

將租戶與社區進行配對不僅為 Whitestone 提供了實現同業領先成長的機會，而且還透過三種不同的方式提供了更好的下行保護。首先，嚴格依賴主力租戶來推動商舖租戶的成功，會導致商舖租戶不必要地接觸主力租戶。相反，我們確保所有租戶都與社區驅動的主要需求相聯繫，從而透過將我們的登山者聚集在一起來限制帶來的風險。

Second, businesses that are out of sync with the community are the first businesses to become more problematic during difficult times. Our proactive approach to minimize the risk of stale businesses gives financial guarantees and long leases that don't protect the traffic and the vibrancy of the center, which is why our underwriting process goes well beyond the financial guarantees and assesses the ability of the businesses to thrive in their new location.

第二，與社區脫節的企業在困難時期最先出現問題。我們採取積極主動的方法來最大限度地降低陳舊企業的風險，提供財務擔保和長期租約，但這些擔保和租約無法保護中心的交通和活力，這就是為什麼我們的承保流程遠遠超出了財務擔保的範圍，並評估了企業在新地點蓬勃發展的能力。

For existing tenants, our team constantly assesses the health of each tenant and does not wait for the end of the lease term to take action if we can upgrade to a tenant that better serves the community. This proactive approach better protects cash flows in challenging times. Terravita is a perfect example.

對於現有租戶，我們的團隊會不斷評估每個租戶的健康狀況，如果我們可以升級到更好地服務社區的租戶，我們不會等到租賃期結束才採取行動。這種積極主動的方法可以在困難時期更好地保護現金流。Terravita 就是一個很好的例子。

We had a previous tenant that wasn't adapting to the changing demographic in the area. The surrounding area was dominated by second homes, but has been rapidly changing as high-paying jobs for Taiwanese semiconductor facility and other reshoring operations are causing young upwardly mobile families to transform the community into one dominated by primary residents.

我們之前的租戶無法適應該地區人口結構的變化。週邊地區以前以第二套房為主，但隨著台灣半導體工廠和其他回流業務的高薪工作促使年輕的向上流動家庭將社區轉變為以主要居民為主的社區，該地區正在迅速變化。

We identified this mismatch between the prior tenant and the community early and moved to bring in a tenant that would capture the community shift. We are already familiar with the Picklr, a best-in-class operator, as we brought them in our McKinney, Texas, Eldorado Center. We knew they'd be a high-traffic driver capturing the active-minded families and health conscious individuals into the Terravita community.

我們很早就發現了先前的租戶和社區之間的不匹配，並開始引入能夠適應社區變化的租戶。我們已經熟悉 Picklr，一家一流的運營商，因為我們將他們引入了我們位於德克薩斯州麥金尼的埃爾多拉多中心。我們知道他們會成為吸引積極心態的家庭和注重健康的個人加入 Terravita 社區的一大動力。

The third and final dynamic I'll mention in terms of downside protection is the diversity of service-based tenants we achieved in combination with our high percentage of shop space. Having a diverse spread of strong local, regional and national tenants removes leverage dynamics that can work against REITs in difficult times.

在下行保護方面我要提到的第三個也是最後一個動態是我們實現的服務型租戶的多樣性以及我們高比例的商店空間。擁有多元化的本地、區域和全國實力雄厚的租戶可以消除在困難時期可能對房地產投資信託基金不利的槓桿動態。

During the pandemic, many property owners relying on national tenants for achieving the security were pressured by these tenants leveraging the size in order to obtain numerous concessions from REITs. Our largest tenant is 2.2% of Whitestone's annual base rental revenues, and this definitely helped translate into our outperformance during the pandemic. So those are reasons shop space produces greater durability of cash flows.

在疫情期間，許多依賴全國租戶實現安全的業主受到這些租戶的壓力，這些租戶利用規模優勢從 REITs 獲得多項優惠。我們最大的租戶佔 Whitestone 年度基本租金收入的 2.2%，無疑有助於我們在疫情期間取得優異表現。這就是為什麼商店空間產生更強現金流持久性的原因。

In a strong environment, shop space tenants have higher rents, sign higher escalators and are far more flexible. This flexibility allows Whitestone to better control the real estate and far better ability to capture the upside opportunities as we constantly evaluate bringing in the strongest tenants possible.

在強勁的環境下，店鋪空間租戶的租金更高，簽約金額更高，而且更有彈性。這種靈活性使 Whitestone 能夠更好地控制房地產，並更好地抓住上行機會，因為我們不斷評估引入最強大的租戶。

Shop space is also perfectly suited to service tenants that have lower capital requirements, allowing us to use the cash flow for growth, either in the forms of redevelopment or acquisitions, both of which are important components of our 5% to 7% core FFO growth target.

商店空間也非常適合資本需求較低的服務租戶，使我們能夠利用現金流實現成長，無論是重新開發還是收購，這兩者都是我們 5% 至 7% 核心 FFO 成長目標的重要組成部分。

Dave spoke on some of these financial benefits anticipated with our overall redevelopment efforts, but I'd like to dive into one specifically to give a little color on what our investments look like. Lion Square should represent a little over the 6th of the overall $20 million to $30 million forecasted redevelopment spend.

戴夫談到了我們整體重建工作預期帶來的一些財務利益，但我想深入探討其中一項，以便稍微說明一下我們的投資情況。獅子廣場的重建費用預計為 2,000 萬至 3,000 萬美元，佔比將略高於六分之一。

Lion Square sits within the Houston Asiatown, which attracts over 9 million visitors annually. We've recently improved the center, bringing in Sun Wing Supermarket and are closely monitoring Park Eight Place, a $1 billion investment down the road that is transforming Halliburton's former campus into a 70 acre mixed-use project centered on a healthier lifestyles.

獅子廣場位於休士頓亞洲城，每年吸引超過 900 萬遊客。我們最近對中心進行了改進，引入了 Sun Wing 超市，並密切關注 Park Eight Place，這是一項未來 10 億美元的投資，將哈里伯頓的舊園區改造成一個佔地 70 英畝的混合用途項目，以更健康的生活方式為中心。

Lion Square benefits from the high barriers to entry of the area being adjacent to this development. We expect 30% to 50% boost in the center's NOI as a result of this redevelopment project. Our capital is extremely well targeted and timed to deliver strong results.

獅子廣場受益於毗鄰該開發案的地區的高進入門檻。我們預計此次重建項目將使中心的營業收入增加 30% 至 50%。我們的資本具有極佳的針對性和時機，能夠產生強勁的成果。

We are also seeing an acceleration in construction time frames as the government university project cancellations free up resources. It is important to note that taking advantage of newly available construction resources isn't something that happens without forethought.

由於政府大學計畫取消釋放了資源，我們也看到建設時間的加快。值得注意的是，利用新可用的建築資源並不是沒有經過深思熟慮的事情。

Plants, permits, vendors need to be ready to go, and we are primed to take advantage of the current environment when the pricing changes. I'll wrap up by pointing out the percentage of shop space versus the peer set we show on slide 12.

工廠、許可證、供應商需要做好準備，當價格改變時，我們準備好利用當前的環境。最後，我將指出投影片 12 上顯示的商店空間與同類空間的百分比。

It's important for investors to recognize that our higher percentage of shop space only delivers results because it's paired with our ability to connect with the surrounding community and because we built a company with the operational chops to manage it.

投資者必須認識到，我們較高的店鋪面積比例之所以能帶來成果，是因為我們有能力與週邊社區建立聯繫，而且我們建立了一家擁有管理能力的公司。

The team there is guiding -- keeping the pedal down and advancing our continued growth. I'd like to thank them for keeping us at the front of the pack. With that, I'll turn things over to Scott to cover the financials.

那裡的團隊正在指導我們——踩下踏板並推動我們持續成長。我要感謝他們讓我們保持領先。說完這些，我將把財務事宜交給史考特來處理。

Thank you, Christine. This morning, we reiterated our $1.03 to $1.07 core FFO per share guidance and our longer-term 3% to 5% same-store NOI growth target. For the quarter, as planned, we took back some space slightly lower, lowering our occupancy from the prior quarter, and we produced strong same-store NOI growth of 4.8%.

謝謝你，克里斯汀。今天上午，我們重申了每股 1.03 美元至 1.07 美元的核心 FFO 指引以及長期 3% 至 5% 的同店 NOI 成長目標。本季度，我們按照計劃收回了部分面積，但面積略有降低，入住率較上一季度有所降低，同店淨營業利潤 (NOI) 增長強勁，達到 4.8%。

Intentionally taking back space in order to bring in higher-performing tenants and drive growth is a fundamental part of our quality of revenue focus. Specifically, this quarter, we made room for the Picklr and Ace Hardware coming in at Terravita.

有意收回空間以吸引業績更高的租戶並推動成長是我們專注於收入品質的基本部分。具體來說，本季我們為Picklr和Ace Hardware進駐Terravita騰出了空間。

All in all, we are reiterating our 3% to 4.5% same-store net operating income projection for 2025. The longer-term 3% to 5% is higher in anticipation of the full impact of redevelopment projects. We continue to see opportunities to acquire centers that fit our stringent criteria and that have the potential to contribute to earnings in both the short and long-term as our leasing team utilizes data from Placer.ai and ESRI to anchor tenants to surrounding demand to a much greater degree than previous owners.

總而言之，我們重申 2025 年同店淨營業收入成長 3% 至 4.5% 的預測。由於預期重建項目的全面影響，長期來看 3% 至 5% 的成長率會更高。我們繼續看到收購符合我們嚴格標準且有可能在短期和長期內為盈利做出貢獻的中心的機會，因為我們的租賃團隊利用來自 Placer.ai 和 ESRI 的數據，將租戶與週邊需求錨定得比以前的業主更大。

I'll estimate that we have about $50 million in acquisitions in the current pipeline financed primarily through cash flow and dispositions. Touching on the balance sheet. Our debt-to-EBITDA are -- was 7.2 times versus 7.8 times a year ago.

我估計，我們目前計劃進行的收購金額約為 5,000 萬美元，主要透過現金流和處置進行融資。談及資產負債表。我們的債務與 EBITDA 比率為 7.2 倍，而去年同期為 7.8 倍。

And we remain on track to continue to strengthen our balance sheet in 2025. In terms of Whitestone's liquidity, we have $16 million in cash and $98 million available under the credit facility. Our dividend remains very well supported with a nearly 50% payout ratio, and we anticipate strong dividend growth as we grow the dividend in conjunction with earnings growth. And with that, I'll keep my comments brief and open the line for questions.

我們仍有望在 2025 年繼續加強我們的資產負債表。就 Whitestone 的流動性而言，我們擁有 1,600 萬美元現金和 9,800 萬美元信貸額度。我們的股息仍然受到很好的支持，派息率接近 50%，我們預計，隨著股息與盈利增長同步增加，股息將實現強勁增長。最後，我將簡短地發表我的評論並開放提問熱線。

(Operator Instructions) Gaurav Mehta, Alliance Global Partners.

（操作員指示）Gaurav Mehta，Alliance Global Partners。

Thank you. Good morning. I wanted to follow up on your comments around occupancy taking some space back. Can you provide some more color on why the occupancy went lower?

謝謝。早安.我想跟進您關於佔用一些空間的評論。能否詳細說明入住率下降的原因？

Yeah, sure. Hi Gaurav. Good morning. This is Scott. The biggest piece of the decline in occupancy is from a retenanting effort at Terravita. There's low paying tenant in there at the end of the year. That's about a 37,000 square foot space that was formerly a grocery store.

是的，當然。你好，Gaurav。早安.這是斯科特。入住率下降的最大原因是 Terravita 酒店的重新租賃努力。年底的時候，那裡就有付低薪的租戶。該空間面積約為 37,000 平方英尺，以前是一家雜貨店。

And we have two great new tenants coming in, the Picklr and Ace Hardware. And so while we prepare that space for the new tenants to take occupancy, there's a slight -- there's a roughly 0.7% decline in occupancy from the end of the year. And that's the majority of it.

我們還有兩個很棒的新租戶，Picklr 和 Ace Hardware。因此，當我們為新租戶入住做好準備時，入住率與年底相比略有下降，約為 0.7%。這就是大部分內容。

Okay. Second question on your comments around $50 million in acquisitions in current pipeline. So is that amount that you guys are looking at? Or is that something that you already have under contract?

好的。第二個問題是關於您對目前 5000 萬美元收購計劃的評論。那麼這個金額就是你們所關注的嗎？或者這是你們已經簽訂的合約？

Hey, Gaurav, this is Dave. Thanks for your question. Yeah, I think we're currently obviously looking for opportunities in our market to acquire properties that match our -- what we look for is characteristics and our ability to add value.

嘿，Gaurav，我是戴夫。謝謝你的提問。是的，我認為我們目前顯然正在尋找市場中的機會來收購符合我們要求的房產——我們所尋找的是特性和增值能力。

So $50 million is just -- is an estimate of where we are right now with our expectation. If you look back, we've done roughly that level over the last couple of years, and we funded that from cash flow and dispositions. So currently, that's what we expect this year.

因此，5000 萬美元只是我們目前的預期。如果你回顧一下，過去幾年我們大致已經達到了這個水平，並且我們透過現金流和處置來提供資金。目前，這就是我們今年的預期。

Obviously, we are looking for opportunities and are continuing to do so. But right now, we're very confident in kind of that $50 million amount that Scott talked about being able to add properties. We've done that, through that, we've improved the overall quality of the portfolio.

顯然，我們正在尋找機會，並且正在繼續這樣做。但現在，我們對史考特所說的 5000 萬美元能夠增加房產非常有信心。我們已經做到了這一點，透過這一點，我們提高了投資組合的整體品質。

I think we talked about -- you've seen the increase in our ABR. You've seen the increase probably in our Green Street TAP scores. So that's really an effort just to continue to refine and improve the quality of this portfolio.

我想我們討論過——您已經看到了我們的 ABR 的成長。您可能已經看到了我們的 Green Street TAP 分數的提高。所以這實際上只是為了繼續完善和提高該投資組合的品質。

Okay. And then lastly, on your debt-to-EBITDA at 7.2 times, which seems a little higher than 6.6 times in 4Q. Can you provide some color on your expectations for your leverage level this year?

好的。最後，您的債務與 EBITDA 比率為 7.2 倍，似乎略高於第四季的 6.6 倍。您能否詳細說明一下今年槓桿水平的預期？

Yeah, I think we expect to end the year in the low 6s. That's where we expect to end up. There's always a little bit of extra NOI that comes in the fourth quarter around percent sales from tenants. Tenants tend to hit their break points in the fourth quarter.

是的，我認為我們預計今年的收視率將低於 6 秒。這就是我們期望的結局。第四季總是會有一些額外的淨營業利潤，約佔租戶銷售額的百分比。租戶往往在第四節達到他們的突破點。

And so we see a pretty sizable increase in percentage rent in the fourth quarter that doesn't repeat in the first quarter. And we also had some termination fees in the fourth quarter that were higher than we had in the first quarter here. So I think when we get to the end of the year, we expect to be in the low 6s.

因此，我們看到第四季租金百分比出現了相當大的成長，而第一季並沒有出現這種成長。我們第四季的終止費用也高於第一季。因此我認為，到今年年底，我們預計該數字將達到 6% 出頭。

Gaurav, it's Dave, I might just add. I think you've seen, obviously, over the last few years, our focus on continuing to strengthen the balance sheet. Through that, we received an investment-grade credit rating. We continue to be committed to growing, obviously, earnings per share, but also strengthening the balance sheet.

Gaurav，我得補充一下，他是 Dave。我想你已經明顯地看到，在過去幾年中，我們一直致力於繼續加強資產負債表。透過這種方式，我們獲得了投資等級信用評級。我們將繼續致力於提高每股收益，同時也加強資產負債表。

So I think if you look back -- Scott mentioned the seasonality, but if you look back clearly, I think we're down 600 basis points from the first quarter of '24. I think it was 7.2 versus 7.8. So super pleased with the progress we're making. We think we've taken some big steps there, and you should continue to see us not only grow earnings at a rate we think will be very attractive, but also have a stronger balance sheet.

所以我認為如果你回顧一下——斯科特提到了季節性，但如果你仔細回顧，我認為我們比 24 年第一季下降了 600 個基點。我認為是 7.2 對 7.8。我們對所取得的進展感到非常高興。我們認為我們已經在那裡邁出了重要的一步，您應該會繼續看到我們不僅以我們認為非常有吸引力的速度增長盈利，而且擁有更強勁的資產負債表。

Okay thank you. That's all I have.

好的，謝謝。這就是我所擁有的一切。

Mitch Germain, Citizens Bank.

米奇‧傑曼 (Mitch Germain)，公民銀行。

Good morning. I wanted to touch on some of the redevelopment efforts. I think all of you provided some perspective on them. And I get that you're doing work on pad sites. It seems like a lot of those, though, are built to sell. I just -- I guess, more granularly, like what are the projects that are underway at your centers that you think are really contributing to that 100 basis point lift in same-store?

早安.我想談一些重建工作。我認為大家都對此提出了一些看法。我知道您正在從事墊場工作。不過，看起來很多都是為了銷售而製造的。我只是——我想，更詳細地說，例如，你認為你們中心正在進行的哪些項目真正有助於同店銷售額提高 100 個基點？

Hey Mitch, it's Dave. I'm going to give just a quick intro to your question, and then I'm going to turn it over to Christine to give you some more details. But one of the things we've tried to do is show the building blocks for investors of how we continue to have consistent sustainable earnings growth.

嘿，米奇，我是戴夫。我將對您的問題做一個簡短的介紹，然後我會將其交給克里斯汀，以便向您提供更多詳細資訊。但我們嘗試做的一件事是向投資者展示我們如何繼續保持持續可持續獲利成長的基礎。

And a piece of that is through redevelopment, remerchandising and making sure that we're getting the most value out of each piece of our property. As you said in our deck, I think we have a series of slides that shows the properties we're working.

其中一部分是透過重新開發、重新銷售並確保我們從每個房產中獲得最大價值。正如您在我們的簡報中所說的那樣，我認為我們有一系列幻燈片來展示我們正在研究的屬性。

And maybe I'll just pause and turn it over to Christine to maybe talk about the specifics. I think in her comments, she talked about Lion Square. But Christine, hit anything you want to hit, it would be great.

也許我應該暫停一下，然後把問題交給克莉絲汀來討論具體細節。我認為她在評論中談到了獅子廣場。但是克里斯汀，擊中任何你想擊中的東西，那就太棒了。

Sure. I think the important part in the redevelopment process is to evaluate where the opportunity, the lease term, leases turn, right? So we always evaluate the terms and then look where we can turn tenants and improve the quality of revenue. In addition to that, that requires some investment usually in the facade, but also into some of the TI with those tenants. And so we found really good opportunities.

當然。我認為重建過程中最重要的部分是評估機會、租賃期限、租賃轉向，對嗎？因此，我們總是評估條款，然後尋找可以吸引租戶並提高收入品質的地方。除此之外，這通常需要在外觀上進行一些投資，還需要對那些租戶的一些 TI 進行一些投資。因此我們發現了非常好的機會。

I think the one that we've used as an example was Williams Trace, where we retenanted with an EoS Fitness and that allowed us to free up some of the parking for some pads. In addition to that, Lion Square is one of the larger ones that we'll be doing this year, should be completed or the majority of the completion should be by the end of the year.

我認為我們用作範例的是 Williams Trace，我們在那裡重新租賃了 EoS Fitness，這使我們能夠釋放一些停車位來放置一些墊子。除此之外，獅子廣場是我們今年要建造的較大的廣場之一，應該會在年底前完工，或大部分完工。

That will allow us to retenant some of the space too to, again, higher quality of revenue. This is -- we look for these ideal locations where we're also seeing adjacent development activity. So we ramp up some of those opportunities tied to where we're seeing massing and new development coming to the area.

這使我們能夠重新租賃部分空間，從而再次提高收入品質。這是－我們尋找這些理想的位置，我們也看到鄰近的開發活動。因此，我們加大了與該地區的聚集和新開發項目相關的一些機會。

So I anticipate that along those lines, too, for example, Garden Oaks has a very large track next to it. It should be sold at some point. There's rumblings with various large grocers looking at the site. When that turns, we're already starting to do the planning effort to invest in that property. The planning is something that's really most of the time when you do an investment like this.

因此，我預計情況也是如此，例如，Garden Oaks 旁邊有一條非常大的跑道。它應該在某個時候被出售。有傳言稱，多家大型雜貨商正在關注該網站。當情況好轉時，我們已經開始規劃投資該房產。當你進行這樣的投資時，規劃是大部分時間都需要做的事情。

Most of it is into the planning. The actual execution takes anywhere from six months to eight months to complete. So you're seeing the ones, especially the ones that we've been talking about on page 20 and 21, these are already in planning, and we'll start continuing the execution through 2020 -- this year, 2025 and 2026, and we're already starting to look at 2027 and 2028 with additional properties.

大部分都進入規劃。實際執行需要六個月到八個月的時間才能完成。所以，您看到的那些，特別是我們在第 20 頁和第 21 頁討論過的那些，都已經在規劃中，我們將在 2020 年、今年、2025 年和 2026 年繼續執行，而且我們已經開始考慮在 2027 年和 2028 年推出更多房產。

So hopefully, it gives you a little bit of color as to what we look for and why. And then again, that's where we expect that we'll be able to drive quite a bit of the returns in our portfolio.

所以希望它能讓你稍微了解我們在尋找什麼以及為什麼要尋找。再說了，我們預計我們將能夠從中獲得相當多的投資組合回報。

Great, that's helpful. On to the balance sheet, there were some nuances. Some notes were a portion of some notes paid seems like with the revolver. Can you just talk about kind of what happened in the quarter and what is that leg to push leverage lower? I know Pillarstone is certainly something that is out there, but what else is exist that's going to bring into the kind of low 6 times range?

太好了，很有幫助。在資產負債表上，存在一些細微差別。有些票據是一些票據的一部分，似乎是用循環紙支付的。您能否談談本季發生了什麼，以及推動槓桿率降低的因素是什麼？我知道 Pillarstone 肯定是存在的，但是還有什麼可以將其帶入 6 倍以下的範圍呢？

Mitch, it's Scott. Thanks for the question. First, the debt that was paid in the first quarter was just some amortization on our prudential bonds that we rolled into the revolver. To lowering leverage, I think it's going to come from both the increase in earnings that we expect to realize over the course of the year and over the next few years and then also cash flow from operations. Last year, we had about $58 million from operating cash flows.

米奇，我是斯科特。謝謝你的提問。首先，第一季償還的債務只是我們轉入循環信貸的保誠債券的部分攤提。為了降低槓桿率，我認為這將來自於我們預計在今年和未來幾年實現的獲利成長以及營運現金流。去年，我們的營運現金流約為 5,800 萬美元。

We were able to use a good portion of that to improve our balance sheet. And this year, I think we'll be in the $50 million to $60 million range in operating cash flows again. And so there's both just continuing operating cash flow improvement.

我們能夠利用其中很大一部分來改善我們的資產負債表。我認為今年我們的經營現金流將再次達到 5,000 萬至 6,000 萬美元的水平。因此，經營現金流將持續改善。

And certainly, the Pillarstone when we work through that bankruptcy process, and we expect those proceeds to be probably between $50 million and $70 million, but it's hard to predict the timing. That's why we haven't included it in our guidance. We'll certainly also improve the balance sheet and lower our leverage.

當然，當我們完成破產程序時，我們預計這些收益可能在 5,000 萬美元到 7,000 萬美元之間，但很難預測時間。這就是我們沒有將其納入指導的原因。我們當然也會改善資產負債表並降低槓桿率。

Great. Last one for me and probably for Christine. I know you and your team do a really fantastic job getting the pulse of what is happening at your centers and your tenants. So obviously, with everything happening in the world, there is some likelihood of a consumer pullback. And I'm curious if some of your tenants on the service side or on the restaurant side are seeing any indication of that trend happening at this point?

偉大的。對我來說是最後一個，對 Christine 來說可能也是最後一個。我知道您和您的團隊在了解中心和租戶的最新動態方面做得非常出色。顯然，隨著世界上發生的一切，消費者可能會回落。我很好奇，你們服務業或餐飲業的租戶是否看到了這種趨勢正在發生的跡象？

Thank you for the question, Mitch. It is something that we've been having a close eye on. I may have mentioned this earlier, but one of -- we see this as a trend more than just a pullback, but alcohol sales for our restaurants have decreased.

謝謝你的提問，米奇。這是我們一直密切關注的事情。我可能之前提到過這一點，但我們認為這是一種趨勢，而不僅僅是回調，我們餐廳的酒類銷售額已經下降。

It seems like dry January is extending into the year, but we see that more related to people making healthful choices and lifestyle. We have not -- we've been tracking quite closely on the fitness side to see if there's been a decrease in traffic, and that has not been the case.

看起來，一月份的乾燥天氣正在延續到今年，但我們發現這更多是與人們做出健康的選擇和生活方式有關。我們沒有——我們一直在密切追蹤健身方面的情況，看看流量是否有所減少，但事實並非如此。

If anything, we've seen a pickup on fitness, again, I look at that as people really looking for the comfort of their communities. On the restaurant portion, we do have a few restaurants that are towards the high end. Surprisingly, that's probably been a little bit where we've seen some pullback.

如果有什麼不同的話，那就是我們看到了健身人數的增加，我認為這是因為人們確實在尋求社區的舒適。在餐廳方面，我們確實有幾家比較高檔的餐廳。令人驚訝的是，我們可能看到了一些回調。

But then we've had two restaurants that just -- that do serve a little bit more on the higher end of the community in Phoenix just opened with huge success. So it's been something we've been watching, but we haven't really seen it impact us yet.

但是，我們在鳳凰城剛剛開設了兩家專門服務高端社區的餐廳，並取得了巨大的成功。所以我們一直在關注這件事，但還沒有真正看到它對我們產生影響。

But again, closely monitoring it, but it hasn't been -- we're not seeing the full effects of it, and we're also not seeing people pull back from -- on the traffic yet as well. So the traffic is still there, sales may be changing. Definitely do see the restaurant trade that they're starting to move again towards a different mix for items that they're producing out there to entice people, but it hasn't been a big pullback in sales yet.

但是，儘管我們密切監視著它，但我們還沒有看到它的全部影響，而且我們也沒有看到人們減少交通量。因此，流量仍然存在，銷售額可能會發生變化。我們確實看到餐飲業開始再次轉向不同的產品組合來吸引顧客，但銷售額尚未大幅下滑。

Hey Mitch, it's Dave. The only thing I might add, Christine is spot on, but I will tell you that her and her team do a tremendous job of picking the right operators. I mean, obviously, in any market, picking the right operators.

嘿，米奇，我是戴夫。我唯一想補充的是，克里斯汀說得非常正確，但我要告訴你的是，她和她的團隊在挑選合適的運營商方面做得非常出色。我的意思是，顯然，在任何市場，都要選擇合適的營運商。

So our underwriting standards, our tenant identification standards have improved significantly since Christine has taken leadership of that team. And so that's a big part of what Whitestone does is obviously watching, but ensuring we're picking the strongest tenants through local knowledge and data.

自從克里斯汀擔任該團隊領導以來，我們的承保標準和租戶識別標準都有了顯著提高。因此，Whitestone 所做的很大一部分工作顯然是觀察，但確保我們透過當地的知識和數據挑選出最強大的租戶。

Yeah, and I just will add one more thing to it. This is really something that's been very striking is we're definitely seeing the contractors coming out of their book shortening in 2026, which is one of the reasons why we're looking at amping up some of that investment into the centers because we see that there might be a bending of the cost curve with construction projects.

是的，我只想補充一點。這確實是一件非常引人注目的事情，我們確實看到承包商在 2026 年縮短了合約期限，這也是我們考慮增加對中心投資的原因之一，因為我們看到建築項目的成本曲線可能會彎曲。

Mitch, do you have any more questions?

米奇，你還有其他問題嗎？

Thank you.

謝謝。

John Massocca, B. Riley Securities.

約翰·馬索卡 (John Massocca)，B. Riley 證券。

Good morning.

早安.

Morning, John.

早安，約翰。

I know you talked a little bit about kind of what was moving the numbers around in the occupancy this quarter. But if you included those two leases you talked about where you brought in kind of a higher paying tenant, what would kind of be the occupancy on like a signed but not opened basis, if you will, roughly?

我知道您談到了本季入住率變化的原因。但是，如果您將剛才談到的引入付費租戶的兩份租約也算進去，那麼，簽署但未開張的租約的入住率大概會是多少呢？

I think it was roughly flat. If you look at just Terravita and moving out the tenant that Scott talked about and the two new ones, Picklr and Ace, roughly, that makes up our -- we think we were [93.9%] last quarter. Correct me, Scott, but we were down about 700 basis points from last quarter, and it's largely flat with those two new tenants. We don't report signed not opened like some of our peers because typically, it's not as big a gap for us because we get tenants open very quickly. But I think roughly, it would be flat, John.

我認為它大致是平的。如果你只看 Terravita 和 Scott 提到的搬離租戶，以及兩個新租戶 Picklr 和 Ace，粗略地說，這構成了我們的 — — 我們認為我們上個季度的利潤率為 [93.9%]。斯科特，請糾正我，但我們比上一季度下降了約 700 個基點，而這兩個新租戶的加入基本上使情況持平。我們不會像一些同行那樣報告已簽約但尚未開業的情況，因為通常情況下，對我們來說差距並不大，因為我們很快就能讓租戶開業。但我粗略地想，它會是平的，約翰。

Yeah, that's very helpful. And then bigger picture, just in kind of the context of tariffs, as you think about your shop tenant base today, what's kind of the rough divide between people offering services and people selling kind of hard goods?

是的，這非常有幫助。然後從更大的角度來看，僅在關稅的背景下，當您考慮今天的商店租戶群體時，提供服務的人和銷售耐用品的人之間的大致差異是什麼？

Yeah, I'll start out and Christine will probably maybe add some as well. But I think in our deck, we do have a slide that talks about our mix. We've always focused on services and kind of e-commerce compatible tenants.

是的，我先開始，克里斯汀可能也會添加一些。但我認為在我們的簡報中，確實有一張投影片討論了我們的組合。我們一直專注於服務和電子商務相容租戶。

And so if you look at our space that we've identified as kind of hard soft goods, it's probably 15%, but we don't have your traditional big boxes. So our tenants tend to be a little less impacted clearly by the impact of tariffs, and I'll let Christine add if she'd like.

因此，如果你看我們的空間，我們發現它屬於硬軟商品，大概佔 15%，但我們沒有傳統的大箱子。因此，我們的租戶顯然受到關稅的影響較小，如果克里斯汀願意的話，我會讓她補充。

Yeah, I mean that's one of the reasons why we've leaned into the services side because of the challenge in the goods being just if you look back just with Amazon. So we've always been defined our role around that in the community is to be more service focused. And so along with that, I'd say it's really less than 15%, if that.

是的，我的意思是，這就是我們傾向於服務方面的原因之一，因為如果你回顧一下亞馬遜，你會發現商品方面的挑戰。因此，我們始終將我們在社區中的角色定義為更注重服務。因此，我想說，如果是這樣的話，它實際上應該不到 15%。

We've asked, again, checked and touch base with some of our restaurants. And again, they're able to pivot quite quickly. So they haven't been as affected. We do have some -- we do have Fergusons in the portfolio. We haven't seen anything from them yet that would cause us concern. But again, that's less than 15%, maybe a fact that's maybe a generous portion.

我們再次詢問、核實並與我們的一些餐廳進行了聯繫。而且，他們能夠相當快地轉變。所以他們沒有受到太大影響。我們確實有一些——我們的投資組合中確實有弗格森。我們還沒有看到他們做出任何讓我們擔心的事情。但同樣，這個比例還不到 15%，事實上這或許是個慷慨的比例。

Okay, that's helpful. And then I know it's only 60 basis points, but your Dollar Tree exposure, just as a reminder, are those true Dollar Trees or are those Family Dollars and kind of if they are Family Dollars, what are you kind of expecting in terms of underwriter credit impact from the split?

好的，這很有幫助。然後我知道它只有 60 個基點，但您的 Dollar Tree 風險敞口，只是提醒一下，那些是真正的 Dollar Tree 還是 Family Dollars，如果它們是 Family Dollars，您對拆分對承銷商信用的影響有何預期？

They're (multiple speakers) Dollar Tree.

他們是（多位講者）Dollar Tree。

Yeah, right, the answer to that. That's it for me. Thank you very much.

是的，沒錯，答案就是如此。對我來說就是這樣。非常感謝。

Thank you. Ladies and gentlemen, as there are no further questions, I will now hand the conference over to Dave Holeman for his closing comments. Dave?

謝謝。女士們、先生們，由於沒有其他問題，我現在將會議交給戴夫霍爾曼 (Dave Holeman) 進行總結發言。戴夫？

Thank you. Thanks to all for joining us today. We very much appreciate your attending and your interest in Whitestone. We're pleased with our start to 2025 and really remain very optimistic about our business model and the ability to produce in different economic cycles.

謝謝。感謝大家今天參加我們的活動。我們非常感謝您的出席以及對 Whitestone 的關注。我們對 2025 年的開局感到滿意，並且對我們的商業模式和在不同經濟週期中生產的能力仍然非常樂觀。

Obviously, there's a fair amount of uncertainty today in the economic environment, but Whitestone is positioned very well. We look forward to engaging with a number of you at the upcoming conferences, ICSC and NAREIT. And with that, I'll wish everyone a great day. Thank you.

顯然，當今的經濟環境存在相當大的不確定性，但白石的定位非常良好。我們期待在即將舉行的 ICSC 和 NAREIT 會議上與各位進行交流。最後，我祝福大家有美好的一天。謝謝。

Thank you. Ladies and gentlemen, the conference of Whitestone REIT has now concluded. Thank you for your participation. You may now disconnect your lines.

謝謝。女士們、先生們，Whitestone REIT 會議現已結束。感謝您的參與。現在您可以斷開線路了。