NexPoint Residential Trust (NXRT) Q1 2018 Results - Earnings Call Transcript

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NexPoint Residential Trust, Inc. (NYSE:NXRT) Q1 2018 Earnings Conference Call May 1, 2018 11:00 AM ET

Executives

Marilynn Meek - IR

Brian Mitts - EVP and CFO

Matt McGraner - EVP and CIO

Analysts

Rob Stevenson - Janney

John Massocca - Ladenburg Thalmann

Craig Kucera - B. Riley FBR

Operator

Good day and welcome to the NexPoint Residential Trust Inc., First Quarter 2018 Conference Call. Today's conference is being recorded.

At this time, I would like to turn the conference over to Ms. Marilynn Meek. Ma'am, please go ahead.

Marilynn Meek

Thank you. Good day, everyone and welcome to NexPoint Residential Trust conference call to review the company's results for the first quarter ended March 31. On the call today are Brian Mitts, Executive Vice President and Chief Financial Officer and Matt McGraner, Executive Vice President and Chief Investment Officer.

As a reminder, this call is being webcast through the company's website site at www.nexpointliving.com. Additionally, a copy of the company's first quarter 2018 supplemental information is available for your review on the Investor Relations section of the company's website.

Before we begin, I would like to remind everyone that this conference call contains forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are based on management's current expectations, assumptions and beliefs.

Forward-looking statements can also be identified by words such as expect, anticipate, intent, and similar expressions and variations or negatives of these words. These forward-looking statements include, but are not limited to, statements regarding NexPoint's strategy, guidance for financial results for the full year 2018.

They are not guarantees of future results and are subject to risks, uncertainties, assumptions that could cause actual results to differ materially from those expressed in any forward-looking statement.

Listeners should not place undue reliance on any forward-looking statements and are encouraged to review the company's most recent Annual Report on Form 10-K and the company's other filings with the SEC for a more complete discussion of risks and other factors that could affect the forward-looking statements. Except as required by law, NexPoint does not undertake any obligation to publicly update or revise any forward-looking statements.

The conference call also includes analysis of funds from operations or FFO, core funds from operations or Core FFO, adjusted funds from operations or AFFO, and net operating income or NOI all of which are non-GAAP financial measures of performance.

These non-GAAP measures should be used as a supplement to and not a substitute for net income loss, computed in accordance with GAAP. For a more complete discussion of FFO, Core FFO, AFFO, and NOI see the company's earnings release that was filed earlier today.

I would now like to turn the call over to Brian Mitts. Please go ahead, Brian.

Brian Mitts

Thank you, Marilynn. Thanks to everyone who is joining the call. Appreciate your time today. I am Brian Mitts, and I am going to start the call, go through some of the highlights for the quarter and touch on some of the more important numbers and talk about guidance. And then I am going to turn over to Matt McGraner who is also joined me, talk to the portfolio so the things we are seeing in a marketplace and then kind of highlight where we are trading versus where we see some things going on in the - particularly in the private market kind of pull everything together and put in a context.

Let me start with some of the highlights for the quarter. I'd say it was definitely quite quarter by our standards. But we basically execute our plan and try to allocate capital in a smart way, which I'll get you here in a second. On that front, we had no acquisition this quarter. We had one disposition which we already discussed. It was put out in our subsequent event in the 10-K, and we talked about it last quarter but that was the Timberglen property located in Dallas, 340 units, sold at for gross proceeds of $30 million, retired the mortgage on the property $17.2 million. With that transaction, we closed out the reverse 1031 exchange for the Atera property which is also in Dallas. And then with some of the proceeds we paid down remainder of the Bridge facility of $8.6 million that we had taken out last year to buy out our JV partner and partially fund the acquisition of Rockledge asset in Atlanta.

On that property, we realized the 45% IRR and 2.8x multiple on our invested equity. So, again, kind of showing the power of the value adds strategy, put up some good returns for our investors. On the debt side, we reduced our total debt at the end of 2017 of $793 million at the end. It was $767 million, again we paid down the Timberglen mortgage when we sold it and then retired that Bridge facility. Our effective interest rate through at least June of 2021 is 3.22%. That's as a result of the six swaps that we put on over the last few years and to put that into some context if you assume LIBOR remains kind of where it is today, which I don't think any of us think that but if it did through June of 2021 when the first of these swaps begin to expire as a savings to us at $12.5 million, which is about $0.59 per share.

So obviously a pretty powerful tool that we've implemented, while still maintaining the flexibility that we get from the floating rate debt. As evidenced by the Timberglen sales 1% prepayment penalty, no defeasance or any extraordinary cost to sell a property. On dividends, we had our board meeting yesterday, the board set a dividend of $0.25 per share for the second quarter be payable I believe June 29th, record holders of June 15th. That's in keeping with where we set the dividend at the end of the year, which was an increase in our supplement, we kind of show the increases over the year since we went public. Part of our goal is to maintain a pretty good healthy coverage from core FFO and then the increased dividends as we increase core FFO.

Today, we're still covering our dividend by 1.54x our core FFO. So still in good shape on that front. On the rehab front, Matt will get through more detail here, but highlights, we completed 298 partial or full upgrades for the inception to date numbers for units we still hold in the portfolio. We rehab 4,527 at an average cost of about $500 per unit. We've seen rent growth at 10.8%, or about $91 per unit per month this rehab. So I think that's - as you see the numbers coming out today and previously and what's going to be reported here in the next week or so. Obviously, a 10.8% increase is extremely healthy in this market.

So again showing the power of this strategy and how it brings value to shareholders. What we've seen on those historical renovations is a 21.2% return on investment. So, again, that's pretty good numbers. Quite a few rehabs left in the current portfolio, 5,000 units roughly that's another $12 million if we figure we got about 2,400 units left in the portfolio. So we think that can add quite a bit to core FFO year over the next few quarters and into 2019.

Per usual, in our supplement, we published our NAV slide to show everybody how we are thinking about value. I am going to touch on a very high level. Matt will go into a little more detail on how we came about some of the thinking of our cap rates in some of the markets. We lowered them in a couple of markets based on some of things that we are seeing. And based on all that we feel that NAV at the midpoint is $30.68, well more to where our stock is trading in 26 context. There has been some market transactions that we have been aware of, we've seen that our public as well as some of the more private ones. That we have some information on. Again, Matt will look at 2018 in little more detail, but I think highlights, that power our strategy and our assets are perhaps underappreciated in the public markets versus where they are trading in the private markets.

So with that I'd say the one of the biggest highlights of this quarter for us was the share buybacks. If everyone is following this company for few years, we put a program replace not quite two years ago for $30 million. We view is a pretty aggressively, certainly this quarter where you saw lot of weakness in REIT. We are trading at what we think was a pretty significant discount. So we bought in the first quarter 203,953 shares at an average cost $24.80 per share for $5.1 million subsequent to the quarter we've even I'd say more active in last 30 days buying 167,267 shares at an average price of $25.35 for a total of $4.3 million.

So subsequent to date over the last seven quarters, we bought 725,737 shares at an average price of $22.58, or $16.4 million. So of the $30 million we gone through over half of that and think that based on where we are seeing transactions take place today and where our stock has been trading, I think that's a great use of capital. As Matt will talk about you'll see a lot of kind of 30 old assets in secondary markets trading at a five caps or lower. So we think buying our stock when we are trading at sort of six cap implied basis, or as we look at it also a discount about 26% to the average cost where we've been buying versus where we think NAV is at a midpoint of $30.68.

So we think that's a good use of the capital. We think that's very accretive, and because of that we asked the Board yesterday and they agreed to expand the program to $40 million, which gives us another $23.6 million of dry power if you will. And that going to extended for two years. So through due to 2020. I think we shared on the past we'll aggressively use that if it's wanted. And if the stock continues to underperform versus we think NAV is we'll continue to utilize that.

Let me go on to the results. I am not going to read to everything here. Just detail on our release and our supplement which is the hits of high points. Our total revenues for the first quarter of 2018 were $35.1 million that's versus $37 million for the first quarter of 2017, a decrease of 5%. However, I note that for the first quarter of 2018 we had 32 properties versus 40 properties for the first quarter of 2017. So quite a significant drop in properties but only 5% drop in revenue.

Net income is measured using GAAP was $10.1 million for the first quarter of 2018, $0.47 per diluted share driven mostly by the gain on the Timberglen sale, versus a loss of $3.3 million for first quarter 2017 or $0.17 loss per diluted share. Our NOI was $19.1 million for the first quarter of 2018, versus $19.7 million for the first quarter of 2017, the 2.9% decrease, again that's on 32 properties in 2018 versus 40 of 2017. Our FFO was $7.7 million for the first quarter of 2018, or $0.36 per share, versus $8 million for the first quarter of 2017, or $0.38 per diluted share. Core FFO was $8.3 million for the first quarter of 2018, is $0.39 per diluted share versus $8.1 million, or $0.38 per share for the first quarter of 2017.

So core FFO is kind of the number we really focus on. So you saw an increase there. AFFO, $9.5 million for the first quarter of 2018, or $0.45 per diluted share, versus $9.1 million, or $0.43 per diluted share in the first quarter of 2017. So again an increase there.

For the same store pool, we had 29 properties in our same store pool for first quarter. Occupancy was 94.1% versus 94.6% for the first quarter of 2017. So 50 basis points drop, pretty much aligned with where we predicted. Same store revenue was $30.2 million, versus $29.1 million, or 3.6% increase for same store. Same store NOI was $16.5 million for first quarter of 2018, versus $15.6 million for the first quarter of 2017, or 5.9% increase. If you look through our supplement in our earnings release, you'll see that we had a very good quarter from the standpoint of expenses. We were able to get some tax refund et cetera from some of the tax municipalities, as well as some better G&A costs, so that help to drive the same store NOI number.

If I turn it back to - before I turn it over to Matt to go through some of the details here and then open it up for questions. Let me go to guidance. So we are reaffirming our 2018 guidance. Our numbers were well within our range for the first quarter. So feel pretty good going forward. Just to reiterate and again I am not going to cover all but here as we disclosed in earnings release and the supplement but at the midpoint with NOI, net operating income will be $78.4 million. Core FFO per diluted share, $1.65 at the midpoint; same store revenues, 5.5% increase at the midpoint and same store NOI, 6.5% increase at the midpoint. We are right in that range for same store NOI. So we feel good about that going forward.

Let me turn it over to Matt to go through some of the details of the portfolio in our markets and give you little color on what we are seeing versus kind of where we are trading. So, Matt?

Matt McGraner

Yes. Thanks Brian. So flush out the same store little bit more in detail. As Brian mentioned, we did 5.9% same store growth in the first quarter. The average rent picked up from $899 last year or last quarter to $933 for the first quarter. That's a 3.9% increase. The revenue is accelerated 3.6% and expenses grew just 90 basis point as Brian mentioned.

Our top line growth for the entire portfolio was incredibly strong, with 8 out of our 10 markets growing at least by 3.3% or more. For historically, the worst quarter for seasonality. Same store results by market. Dallas had a healthy 9.2%; Houston was negative 9.8% which I'll get into a minute. DC Metro was 3.8%; Atlanta was 3.4%; Nashville, 10%; Charlotte, 6.4%; Phoenix, 8.2%; West Palm Beach, 10.1%; Orlando, 7.4% and Tampa 7.8%. So very healthy in Florida and our four markets.

Leasing activity continues to be really strong especially for the first quarter despite the seasonality. We experienced new lease growth of 4.3% with our top five markets being Orlando, Tampa, Phoenix, West Palm and DFW. Orlando came in at 9.5%; Tampa, 8%; Phoenix, 7.6%; West Palm Beach was 7.2%, and DFW at 4.5%. Renewal increases were also strong averaging 3.9%, our top markets being Orlando again Nashville, Dallas and West Palm Beach. Orland led with 6%, Nashville, 5.1%, Dallas, 4.8% and West Palm at 4.4%.

We continue to focus on renewal retention. We did a great job in the first quarter; remain very strong at 52.7%. Some of the highlights that Brian mentioned that we want to talk about briefly. In the markets, as far as transactional activity, obviously we continue to allocate capital to our internal growth initiatives, and a share repurchases activities. As Brian mentioned, we asked the board and they agreed to extend the plan by two years and increased capacity by $10 million. The private market for acquisitions has never been stronger in our view. And we will continue to take advantage of the cap rate disconnect between the public and private markets.

In today's market, it's incredibly difficult for us to purchase a value at asset north of a five cap. We've highlighted that in our supplement on page 8. We give you a sense of two trades or one deal in play and the other one that was announced late last year, and mentioned previously on the call. But to hit the highlights, the pure multifamily REIT process, it's a 7,000 unit portfolio in southeastern and southwestern United States. That's reportedly in play at 4.52% cap rate. That's an implied per unit of about $165,000 a unit. And then the steadfast recap by Blackstone, which occurred late last year in November. That's the southeastern and southwestern base portfolio value adds assets. That transaction was reportedly struck at a 5% cap rate with an implied unit per door value of $185,000 a unit.

So at our midpoint of our NAV, we're valuing us at 5.64% cap rate and a $121,000 unit is what it equates to on a per-unit value. So a pretty good disconnect that we will continue to use the buyback to take advantage of. Competition for assets that was a portfolio competition for assets on a one-off basis are-- they're equally as strong. We received several BOEs and unsolicited offers in certain markets during the quarter, which is Brian mentioned together with independent third-party analysis led us to revise our midpoint upwards to $30.68 a share, which again is a 5.64% cap rate.

The summary of cap rate changes, I'll just them hit briefly. Dallas we moved to midpoint of 5.5%, down 25 basis points as a result of the Timberglen sale, and unsolicited offer on venue. Charlotte, we moved to down 25% as a result of an unsolicited offer in a BOE process on Timber Creek. Nashville move 25 basis points, down to 5.75 % as a result of an offer on Willow Grove and a process that we ran on or an acquisition that we offered on the deal called Hampton in our sub markets. Orlando moves down to 25 basis points now 5.5% and as a result of Cornerstone BOE and an offer on that asset.

Tampa moves 35 basis points down to 5.5% as a result of offers and BOE processes run on Courtney Cove and Summit Cipro part. Then West Palm moved to 25 basis points down to 5.75% mid as a result of the season's offer, or an offer we got on seasons.

On the financing front, fixed and in particular floating rate GSE spreads for multifamily assets remain constructive for asset values, be peace buyers have bid down spreads from LIBOR plus a 1,000 a year ago to about LIBOR plus 758 -800 today. There's a lot of Fannie and Freddie of course to continue to tighten spreads and originate loans. Also material increases in labor and material costs. Our constructive for our portfolios values today are implied per unit value again is $120,000 a unit. That's roughly two-thirds of replacement costs. So it still feels pretty cheap relative the private market bid especially considering the spike in labor and material cost we've seen recently in the market. Replacement cost is obviously increasing and now developers need to achieve in our estimate of $1,500 in net effective rent to justify five cap exits for a brand new garden deal today, which is nearly $600 Delta and rent to our portfolios average effective rent.

And what this means to us is that this demonstrates both the value proposition two of our assets to tenant and then the healthy headroom we have to grow rents at an above average clip.

Let me end with the strong leasing activity we experienced in April. Our portfolio today it's at 95.26% physically occupied and incredibly strong 97% leased. April's renewal retention ratio was up to 54.77% and new leases have been signed at an average of 5.2% increases, while renewals have seen a 4.6% increase. So needless to say, we're excited about Q2 and the rest of 2018. Appreciate all the hard work at - for our team members here at NexPoint and BH. That's all I have prepared remarks.

Brian Mitts

Thank you. So to kind of summarize, we think very good quarter. We think the year looks pretty strong from where we sit. We don't have the supply issues that maybe some of our peers and multifamily sector are dealing with. We think that our portfolio of leased assets are priced in public markets are somewhat under-priced, based on what we're seeing. So we're taking advantage of that by continuing to invest on the rehab front, and put out more units to Matt's point, try to drive the rents up. And we think we have a long runway on that given what we're seeing out there as far as a newer product or some of the competing product. We're also doing a second generation type of rehab, which we talked about last quarter. It's a detail which is helping us to push rents as well. And then, of course, we're taking advantage of the disconnects between what we think the value of the portfolio is versus what is price in public markets.

So with that Marilyn we' will turn it over for questions.

Question-and-Answer Session

Operator

[Operator Instructions]

The first question comes from Rob Stevenson from Janney.

Rob Stevenson

Good morning, guys. You talked about accelerating redevelopment given the difficulty in redeploying capital into acquisitions. I mean given what you are doing currently how significant is your capacities to ramp on a quarterly basis over and above what you're doing or where do you just sort of run out of manpower to be able to accomplish the renovations on a cost-effective basis?

Matt McGraner

Yes, I think that we have the ability to do another 150 or so units per quarter. It was harder in the first quarter to achieve that run rate for a couple reasons. One we just renewed more folks at a higher rent, which is probably smart during the season, but we expect and have at least for the month of April that for the rest of the year --the remainder of the year that we should be tracking that 400 to 500 range per quarter, which has historically been fairly consistent. But that is a focus of ours.

Rob Stevenson

Okay. And Matt you've sort of faded out when you were talking about Houston. What was behind the drop-off in revenues there on the same store basis?

Matt McGraner

Yes. I appreciate the question. So rental revenue was down 6.3% and that was largely as a result of three deals and lease up that are surrounding Tanglewood, Everly and Alexan 5151. Those are all stabilized now and actually March was great, it was on budget. The asset and this is --I'm speaking about old farm which is at 734 unit deal that we bought in the Galleria area. And it's performing exceptionally well now and expected to be one of the best performers here on out throughout the year. For example, we signed I think almost 85 leases in the last four weeks, current occupancy is up to 93% and it's leased by almost 98 % now. So we think it's a blip on the radar, but it did affect results for the first quarter. Also the city over billed us for water pretty dramatically. So we expect that we'll get a credit back in the later quarters. So it should work itself out, but it was a large contributor to the negative for the first quarter.

Rob Stevenson

Okay and then in terms of expenses what are you guys spending these days on a per unit basis on hard turnover costs?

Matt McGraner

What do you mean by hard turnover costs? Like years?

Rob Stevenson

Well not obviously not the large rental rate but what are you spending to do any work on a unit on average between the time somebody moves out and the next tenant moves in terms of painting, carpet cleaning, carpet replacements, the sort of repairs and maintenance not so much the wholesale kitchen and bath renovations?

Matt McGraner

Yes. It's about a 300 unit on the low end, in the market $300 to $500 per unit.

Rob Stevenson

Okay and then lastly for me, the insider ownership moved up 19.5 to 20.7 this quarter. How much of those 120 basis points was the lower share count from you guys buying back versus how much was it management putting more money in?

Brian Mitts

Both were factored in February. There is a stock vesting on the Alto. So that contributed, obviously, we bought back quite a few shares that contributed and then Jim continues to put money or in the stock. So I'd say the buybacks had an effect but the price, bigger effect was of the vesting of shares in February.

Operator

Our next question comes from John Massocca from Ladenburg.

John Massocca

So would you ever consider selling individual assets solely to buy back shares or are the tax consequences of that just too severe?

Matt McGraner

I think we have, we did that early on in June of 2016 when we sold our Jacksonville portfolio, it's a retire debt and then we instituted the buyback plan shortly thereafter. So yes we'd be open to it for sure.

Brian Mitts

Yes. I would add that if you look at the history of the company, we've never raised outside equity, we aren't paying out everything obviously. So we were well covered by 1.5x on core FFOs. So it's a little bit of cash flow that's there to deploy and acquisitions, rehabs or share buybacks. So, yes, it comes from a number of sources, but I mean in general to buy 60 million of stock over the last two years, you get a little bit into the proceeds from sales.

John Massocca

Understood and then are you seeing any difference in pricing for Class D multifamily assets being sold as part of portfolios versus individual assets? I know you had mentioned both markets were pretty strong, but you think you could maybe sell a portfolio i.e. what you did with the NAV portfolio and recycle that accretively into assets on a one-off basis or are both markets just a little too tight right now?

Matt McGraner

Well, the good thing about when you sell assets and recycle to capital of what we've done, we compound the equity returns on the original cost of our fund. So we will always continue to do that. So we don't necessarily look at it in a binary manner that we can't redeploy assets in large part what we have done is recycle capital into higher margin, higher NOI margin properties in better locations. So that's something that I think that will continue to focus on. But it is a difficult market. We were at a Greenstreet conference in New York a couple weeks ago and David Schwartz at Waterton said this in front of a large group. He said that, well, basically what I said you can't find any garden deal or value add asset that's north of a five caps. So you just got to be really selective and that's a single asset in portfolios. There's a lot of capital chasing these assets right now. And what I think it is the convergence of value add buyers and core plus buyers chasing the same assets, obviously, core plus buyers have a lower cost of capital and then the value add guys haven't gone away and with the leverage that the private market can get these are still relatively attractive yields in a stable asset class. So I think it's going to continue to be strong. It's good time to own our assets.

Brian Mitts

Yes. What Matt mentioned is reflected in the numbers we're providing higher margin, will higher quality assets, the fact is total revenues and total NOI hasn't really dropped that much, although our portfolios is eight properties less than it was this time last year.

John Massocca

Makes sense and then kind of a little bit more on a granular level. Your tax expense on the same store basis decline 2.3%. How much of that was from new tax appeal versus flow-through from tax appeals in prior quarters, generally speaking?

Matt McGraner

Did you say 2.3 you mean decreased 2.3%?

John Massocca

Sorry, correct. Yes. I just I think some of that obviously got to be from stuff happening into 2Q, 3Q and flowing through. How much of it is that versus a new tax appeal that lowered your expense there?

Matt McGraner

Most of our processes are well really all our taxes are disputed. So every single property, every year, thing on the municipality that they settle in different times. So it's hard to say the negative - the reduction of 2.3% will occur on in any specific quarter. I think for this quarter I think it was largely as a result of settlements that we had disputed in 2017 in our Texas markets, which we think that we achieved a favorable result. That being said, the municipalities aren't necessarily getting any easier. So it's hard to pinpoint exactly an answer to the question, but I would just qualitatively say that that's--

John Massocca

So you guess you kind of expected to normalize here in the coming quarters, given that this Texas appeals kind of -

Brian Mitts

Well, as Matt said -

John Massocca

Overlap

Brian Mitts

We pretty much dispute everything and the municipality has been pretty aggressive. The public markets may not appreciate the value of our assets but the municipalities certainly do. So I think you'll see to extent that we can have success in that process. We will continue to see some favorable tax numbers in the next few quarters vis-à-vis that the prior year but it's hard to predict. I think what you saw this quarter the vast majority, it was a result of what we had done in 2017 probably coming to fruition and settling or getting a better answer and paying that than what we had experience or some of the initial assessments.

Matt McGraner

Yes, if you want to get granular I can give you sort of two markets that I think will largely see savings in the rest of the year once we appeal and that's Atlanta and Charlotte. Atlanta was up 17%, it was up 17.5% and we're obviously disputing that with vigor. And then Charlotte was up 7%.

Operator

Our next question comes from Craig Kucera from B. Riley FBR.

Craig Kucera

Hi, good morning, guys. I would like to know if we can get an update on Southpoint Reserve at Stoney Creek. I think we were looking for a sale price maybe around $19 million in the second quarter. Has anything moved in regard to your expectations there, whether timing or pricing?

Matt McGraner

Definitely pricing. So NOI has gone up materially. We think that now we can get north of $22 million around $22 million. And then we are obviously minding the acquisition front and trying to find a use of proceeds to cycle or a replacement property cycle that capital into or buy back shares. But I think that I would expect at least for the first half of the year that we could - that you'll see us recycle out of that.

Craig Kucera

Got it. Based on that revised NOI is that still around a five cap? Or can you give us some color there?

Matt McGraner

I think five in a quarter on in place, but as I mentioned our budget NOI was up. Our budgeted NOI not underwritten but our budget NOI was almost up 12% on the same store basis. So if we achieve that cap rate might be higher on our budgeted number, but on our T3 number we'll look to dispose that on a 5 to 5.25.

Craig Kucera

Got it. One more for me just given the amount of inbound calls, when you think about your guidance, are there any other dispositions embedded in that guidance? Or any incremental share buybacks beyond what you guys have already completed here in the first and early here in second quarter?

Brian Mitts

I'll take the buyback question. I think, yes, there absolutely is depending on where the stocks trading, we telegraphic quite a bit by putting out the NAV slide. So $30.68 is kind of where we think value is, the extent we're trading in the 26, 27 context. I think you can expect that we would take advantage of the fact that we have even more ability to buy stock in a longer time frame with an expanded program, not on the dispositions.

Matt McGraner

Yes. I think that's the only one that we are seeing today. And it would be sort of apples- to-apples like selling something for $22, something for $22 to $25 at a higher NOI margin. So I wouldn't expect from a core FFO basis any earnings leakage. We would try to recycle it in an effective manner. So as not to dilute the earnings stream.

Operator

Okay. At this time, I'd like to turn the call back over to Mr. Mitts.

Brian Mitts

Yes. Thank you for the time. That's all we have today. Appreciated, we'll I think see some of you in NAREIT here in a month or so. And look forward to that. We'll talk to you in three months. Thank you.

Operator

Thank you, ladies and gentlemen. This concludes today's teleconference. You may now disconnect.

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