Ladies and gentlemen, thank you for standing by. I am Yeli, your Chorus Call operator. Welcome, thank you for joining the LAMDA Development conference call and live webcast to present and discuss the first quarter 2026 financial results. All participants will be in listen only mode, the conference is being recorded. The presentation will be followed by a question and answer session. Should anyone need assistance during the conference call, you may signal an operator by pressing star and zero on your telephone. Please note that the presentation and slides are in manual format. Each participant can access and view individual slides as they wish. At this time, I would like to turn the conference over to Mr. Apostolos Zafolias, Chief Strategy and IR. Mr. Zafolias, you may now proceed.
Thank you. Good evening, ladies and gentlemen, thank you for joining us today as we discuss our financial results for the first quarter of 2026. The first quarter marked a strong start to the year, reflecting solid momentum across all core business segments. Our shopping destinations and Flisvos Marina delivered record performance, while construction at The Ellinikon continued to advance at pace, with major developments progressing well into their execution phase. As a matter of fact, the delivery of the first projects will be kick-started this year with The Ellinikon Sports Park, which will open its doors to the public gradually beginning in July of this year. After having already successfully hosted the super special stage of the 2026 Acropolis Rally a couple of weeks ago.
The next projects to open their doors to the public next year are going to be the Riviera Galleria, the renovated Agios Kosmas Marina, while a number of our residential developments, both in the coastal front as well as in Little Athens, are progressing towards their delivery stage with estimated completion dates starting in Q1 of 2027 and continuing through the end of the year. The acceleration of construction activity across the development, as reflected in the CapEx recorded during the first quarter, has also had an impact on our financial performance. Specifically, infrastructure related expenditures have increased operating expenses in the near term. However, the investments are fundamental to advancing the project from the design and sales phases into delivery, supporting the creation of a well-planned integrated development. This applies across all key components of the development, including residential neighborhoods, sports facilities, and the Metropolitan Park.
We remain committed to delivering the diverse portfolio of development within The Ellinikon and creating sustainable long-term value for our shareholders with a renewed focus on execution and cost efficiency. We're also focusing on the optimization of our capital structure. We already issued EUR 500 million worth of bonds in November and another EUR 300 million worth of bonds in June, having high investor demand and at the favorable terms. By doing so, we pushed the bond expirations by seven years, maintaining favorable cost of debt in a period of rising rates. More specifically, in the mall segment, we delivered another quarter of record performance. Profitability continued to improve year-over-year, primarily driven by the higher rental income and increased parking revenues.
All of this is supported by very strong KPIs across the board, resilient footfall, and new all-time high in tenant sales. These results once again demonstrate the strength of our retail platform and its ability to generate sustainable earnings and strong recurring cash flows over time. On the marinas front, Flisvos Marina delivered another quarter of record performance, reflecting sustained strong demand in the premium yachting market and continued growth across its revenue streams. At the same time, we are investing in the next phase of growth both in Agios Kosmas and in Corfu. In Agios Kosmas through a comprehensive redevelopment of the marina, which together with the adjacent Riviera Galleria, is expected to become a significant driver of future revenue growth for the group upon completion next year. At The Ellinikon now, the first quarter marked a strong period of execution.
Revenues increased by 55% year-over-year, reflecting the continuous progress of residential development as construction advanced across the whole project. Development and construction has accelerated across both the residential as well as the infrastructure works, supporting the successful delivery of our long-term master plan. At the same time, commercial momentum has remained strong. As of the end of May 2026, cumulative cash proceeds from property sales and leases have surpassed EUR 1.7 billion and continuing to grow. Momentum continued into June with almost 90% of the 671 units that we've launched within the Little Athens neighborhood sold or reserved. On the construction front, Riviera Tower reached the 50th floor, attaining its full 200-meter height. The earlier 44th floor construction milestone, which was concluded in March, has resulted in the full collection of a EUR 60 million contractual payment, further supporting cash flow generation.
The positive progress on the construction front is also evident in our results and reinforce our expectation of exceeding a EUR 1.6 billion of cumulative CapEx through the end of this year. I will now hand the call over to Harris Goritsas, our Group CFO, who will talk you through the key highlights of the group's financial results in more detail.
Thank you, Apostolos, and good evening to everyone from my side as well. I will take you through our financial results for the first quarter 2026, referring to selected slides on the presentation that is available on our website.
I will begin with an overview of the group's key highlights. Then I will provide a more detailed review of the performance of our three core business segments, namely malls, marinas and The Ellinikon. Starting at group level, total revenues reached EUR 143 million in the first quarter of 2026, up 35% year-over-year, driven primarily by higher revenue recognition from residential developments at The Ellinikon, reflecting the increased pace of our construction works as well as the continuing strong operating performance of our recurring income generating malls and marina assets. Important to note that group EBITDA before The Ellinikon grows by 3%, whereas The Ellinikon EBITDA is hit by the acceleration of infra works. We will talk more in detail on the section about The Ellinikon Mall on that one. Details of the EBITDA and the net results breakdown can be shown on slides eight to 10 of the presentation.
The value of group's total investment portfolio surpassed EUR 3.8 billion as of March 31st, 2026, driven by all assets in our portfolio, reflecting continuing value creation. Furthermore, total group cash remained at a strong level, accounting to EUR 831 million as of end March 2026. To note, in early June 2026, we successfully completed the issuance and listing of a EUR 300 million bond. Combined with the early repayment of the group's bond issued back in 2020, which is planned for execution on the 21st of July of this month, the transaction further optimizes our funding profile, extends our debt maturities, and reaffirms our continuing access to the capital markets. Analyzing each of our business segments now, I will start with the LAMDA Malls and our four operating malls EBITDA, which reached EUR 22.7 million in quarter one 2026.
Operating malls EBITDA, adjusted for the EUR 2.2 million of intragroup recharges, was EUR 24.9 million or 5% higher year-on-year. This strong result was primarily driven by the 5% increase on the base rents and 8% increase in parking revenues for the same period. This performance was supported by a 5% increase in footfall versus same period last year, and a new all-time high in tenant sales, which reached EUR 187 million in quarter one. With respect to the commercial leasing progress of our two retail and entertainment destinations at The Ellinikon, which are currently under development, Head of Terms that have been signed with tenants represent 70% of the GLA at The Ellinikon Mall and 76% at Riviera Galleria. This strong momentum highlights the solid fundamentals of the Greek retail market and the continued interest from leading international brands in our landmark developments.
Concrete works at Riviera Galleria have been completed with electromechanical installations and partitioning works progressing well. At The Ellinikon Mall, construction works commenced a few weeks ago in June by Terna S.A. As of March 31st, 2026, the total gross asset value of LAMDA Malls Group reached EUR 1.8 billion, with a value of the four operating malls reaching a new record high of EUR 1.4 billion. For a detailed analysis of LAMDA Malls financial results, please refer to slides 14 to 18 of the results presentation. Moving now to our marinas business unit, Flisvos Marina continued its strong growth trajectory, achieving a new record performance in the first quarter of 2026. Total revenue reached EUR 6.3 million, while EBITDA grew by 12% year-on-year to EUR 4.5 million. Performance was primarily supported by higher revenue from yacht transits, as well as annual contractual fees uplift.
While Flisvos Marina continues to deliver strong operating performance, the group is also investing in its next phase of growth through the comprehensive redevelopment of Agios Kosmas Marina. A phased reduction in available berth is currently taking place as part of an extensive redevelopment program designed to significantly upgrade infrastructure and services while reconfiguring the layout to accommodate larger vessels. Upon completion in mid-2027, Agios Kosmas Marina is expected to serve as a key driver of incremental revenue growth for the business unit and, of course, for the group. Details on marinas performance are available on slide 19. Let me now turn to our landmark Ellinikon project and highlight some of its key achievements during the period.
Commercial demand for the Little Athens neighborhood remains strong. As of the end of June 2026, 590 out of the 671 units launched have been sold or reserved, representing an absorption rate of 88%. This reflects a sustained customer demand and reinforces the attractiveness of the Ellinikon residential offering. Revenue from residential developments reached EUR 87 million in Q1 2026, representing a 33% increase compared with Q1 2025, driven by ongoing construction progress and the relevant recognition of revenue under accounting standards. In addition, during the first quarter of 2026, we recognized a further EUR 14 million of revenue from property sales, primarily relating to office spaces. As a result of projects' continued commercial success, cumulative cash proceeds from residential sales and long-term lease agreements have exceeded the EUR 1.7 billion milestone from the launch of Ellinikon back in mid-2021, and until end of May 2026.
Details on Ellinikon cash collections are available on slide 21. Construction progress has accelerated, registering an increase of EUR 126 million during Q1 2026, bringing the total CapEx for buildings and infrastructure works from the start of the project and until March 2026, over EUR 1.1 billion. At this point, I want to emphasize a short-term P&L hit from this construction progress. As infrastructure activity ramps up, the associated non-recoverable VAT is registered in our operating results following relevant accounting rules.
Consequently, the increase in Ellinikon's operating expenses, as depicted on slide 24 of the presentation, is a function of higher investment activity rather than higher underlying operating costs. To give you the magnitude, 51% of our reporting operating expenses under Ellinikon in quarter one 2026 represent non-recoverable VAT. This is more than three times higher than same period last year, indicating the significant acceleration of construction works we have talked about.
Finally, total CapEx deployment remains on track. Based on our current construction schedule, we remain confident in achieving our full year 2026 CapEx target of approximately EUR 1.6 billion. Further details are shown on slides 23 and 26. With that, we conclude the key highlights of our first quarter 2026 financial results, and we will now be happy to answer your questions.
Ladies and gentlemen, at this time, we'll begin the question and answer session. Anyone who wishes to ask a question may press star followed by one on their telephone. If you wish to remove yourself from the question queue, you may press star and two. Please use your headset when asking your question for better quality. Anyone who has a question may press star and one at this time. One moment for the first question, please. The first question is from the line of Natalia Svyriadi with Eurobank Equities. Please go ahead.
Good afternoon. I hope you can hear me.
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Okay. Thank you very much for taking my question. I was wondering if you could give us a hint on the infrastructure, the last thing that we just mentioned on the infrastructure CapEx. How this is coming into our OpEx. When do we think this will be completed? When would this be, so we can have an understanding on how it will be shown in our costs going ahead?
I think you asked about the impact that we have in OpEx from the ongoing CapEx from infrastructure works.
Yes.
Okay, Natalia. This is Harris. Let me take and try to clarify what we just previously commented. Typically, the infrastructure, along with, of course, the residential project CapEx, is capitalized. It does not hit the P&L. What is now the specificity for Ellinikon project on infra? Infrastructure is not a direct allocated cost, so we treat it based on IFRS as an indirect cost that is allocated to the projects. Because of that IFRS treatment, the VAT follows the pro rata rule. Almost 90% of the VAT of infrastructure cannot be recovered, thus has to be expensed. It means it hits the P&L. Last year, same quarter, we had EUR 3 million of non-recoverable VAT. This year, because of the acceleration, we have EUR 12 million non-recoverable VAT. This is more than three times that I was referring to my speech.
This EUR 8 million incremental hits the quarter's profitability via the OpEx line. This is past. This is current and past performance. What do we project? We project infrastructure to remain on an accelerated basis. It will have ups and downs. I cannot confirm it will be EUR 12 million for every quarter, but it will be in the same bulk, a little bit more, a little bit less. It depends on the quarter of execution. How long? The main infrastructure works are planned to finish by mid of next year to end of next year, where we plan to also deliver the first residential projects to the inhabitants. One could say that for the next, I would say 18-24 months, this trend will continue.
Great. That was very clear. I also have one question on The Ellinikon Mall. Have you drawn any lines? Have you signed any loans on The Ellinikon Mall, Odisseas? Construction has started, or is this something that we should expect coming ahead?
Because the line is not good, let me repeat the question. Your question was about The Ellinikon Mall, and if we have drawn down any of our signed loans. Correct?
Correct.
Of course, we have. First of all, under The Ellinikon Mall, we have two malls, the Riviera Galleria and The Ellinikon Mall, which is under construction, the big one. Riviera Galleria, as we said, it is progressing very well. We consider we will be finished with the construction end of this year, beginning of next year. Of course, we have drawn down lines. I would say we are at 50% of the drawdown, and we expect the rest to happen throughout the course of the remaining months. For The Ellinikon Mall, as I said, construction has started a few weeks ago. We have not drawn down yet any line. We are about to sign the final agreement. We are finalizing the deals with the banks within half two of 2026. Currently, all the expenses are happening from our own cash.
Thank you very much for this.
No problem.
Might I ask also if you could remind us which the next important milestones in The Ellinikon projects are? The important ones, when we should expect another milestone.
I'll take that. Look, I think that the first milestone in line is the opening of the sports complex, which as I mentioned already, kind of had a pre-opening, if you wish, by hosting the Acropolis Rally in June, and is expected to start to open its doors and start operating gradually from July of this year, this month, essentially, onwards through the end of the year. Beyond that, I think the next projects coming online are Riviera Galleria and the Agios Kosmas Marina. The plan is to have them ready at the same time. As Harris mentioned, expectation of completion of construction is towards the end of the year, beginning of next. Then, opening is still in discussion with the retailers, probably second half of next year, of 2027, with exact dates, obviously, to follow.
Beyond that, I think on the residential front, you have Riviera Tower, along with Cove Residences and a bunch of developments in the Little Athens neighborhood that are starting to complete their construction end of this year, beginning of next, and deliveries are going to take place in 2027. I think those are the main milestones, if you wish.
Okay. Thank you very much. That was very clear, and thank you for answering my questions. Sorry for the line.
No problem, Natalia.
The next question is from the line of Jakub Caithaml from Wood & Company. Please go ahead.
Hi, this is Jakub Caithaml from Wood. Hi, everyone. Thanks very much for the call. Three from my side, also one by one, if I may. I hope you can hear me well.
Yes.
Thanks. First, on the resi sales, I think that over the last 12 months, you sold roughly 100, 110 apartments, which brings the Little Athens to almost 600 apartments sold overall. Then there is the Riviera Tower, and the Cove Residences, which would bring the total to even higher, I think potentially eight to 900 sold.
I wanted to just confirm, I think originally we were thinking about 1,300, 1,400 apartments for the first phase. I think that now the figure may be a little bit higher, which would mean that we are approaching two-thirds of the apartments hold. Is this right way to think about this? Also in context of the coming completions, which are getting closer, should we expect that this annual pace of sales will be picking up now? How are you thinking about the share of apartments that you would like to have sold by the time these individual projects are being completed? How much of these apartments, roughly, do you think would be optimal to delay and maybe sell, hopefully, for a higher price, only once those projects and individual parts of the first phase are standing?
Okay. Jakub, I'm going to try to remember all of them. To start with, I think that you were asking about the total number of units that are going to be launched and sold. Out of now, 315 units have been launched and sold at 100% in the Coastal Front. Plus another 670, let's round up to 700 for argument's sake, of Little Athens. Of those 670, about 90% of those have been sold, and there's another small piece remaining to be sold. Roundabout numbers, you're talking about 1,000 right there. Through the end of this year, beginning now, actually, we're going to launch another 300-350. 120, I believe, are being launched this month, and the remaining 200 and something are going to be launched through the end of the year.
That will reconcile you to that total 1,300 unit number that you were referring to. Is that clear? Then I'll move to the next.
Got you. This would be it for the first phase? The total for the first phase, we're looking at something like 1,300, 1,400.
Yeah. About 1,300 units. Correct.
Got you. Thanks.
As far as the second question goes, I think you were referring about pace of sales. Let me give you one brief background, then I'll talk about the future as well. As far as background goes, the pace of sales was very strong. It has been very strong through the project. I'd say that over the last couple of months, the pace has reduced only because we didn't have enough units as inventory in order to push them out into the market. That is being gradually resolved. As I mentioned already, we're putting another 100 in the market, then another 200 something through the end of the year. I do expect to see a bit of increase back to previous levels, through the end of the year.
Furthermore, I think you said going forward, how we're going to deal with the pace of sales versus construction is what I think that you're asking. Look, I think that although in the first phase, we were forced to really sell some units faster than optimally in a real estate 101 lesson that would say, "Okay, keep the majority of them or best ones for later stages." I think that as the project matures, as our experience matures, I think you're going to see a little bit more of a shift towards getting the first 30% done to get the project going, then figuring out your options with the remaining as the project matures.
Mm-hmm. Got you. Okay. Thanks very much. This is very helpful. May I ask a follow-up on this? Given that we are now probably over 60% of the first phase units sold, and given that also the construction of some of these projects is getting more advanced, would you just remind us across the entire first phase residential, excluding the village, because the village has different margin profile. What would be roughly the total revenue that we could be thinking about? On the other hand, the total planned infrastructure associated and construction costs, and what kind of margins, all in, would we be looking at for the first phase resi?
Let me pick up some of these. First of all, in terms of guidance on infrastructure and sales, what we have been doing is we've been giving guidance on a year-over-year basis. We've actually included some slides in the presentation. For 2026, we're basically talking about EUR 600 million of anticipated cash inflow, then about EUR 600 million of anticipated CapEx. We feel comfortable about achieving those through the end of the year. Look, as far as margins go, I think that we all know that the margins on the Coastal Front properties were not what we had hoped or anticipated for. You already touched part of the reason in the timing of sales. Again, the timing of sales, we had to do that in certain projects in the beginning of the phasing.
In Little Athens, the margins have been improving, especially so by the projects that are being done by the CBU. We've been targeting a 40% gross margin rate for those developments. The last thing I'll say is, yes, over 60% of the sales have been, of the cash, if you wish, has been completed, but the rate of completion, which is what allows revenue recognition and therefore visibility of revenues and margins, is not that high yet. I remind you that the cash payments are front-loaded vis-a-vis the execution of milestones that define accounting recognition of revenue.
Yeah. Jakub, this is Harris. If I just add a bit more color of what Apostolos just has said. In the balance sheet, if you see a little bit our balance sheet, you will see as a liability, deferred revenue amount. This is EUR 400 million. What is this? This is a portion of the EUR 1.7 billion that we have collected as cash project to date, and we have announced that. The percent of completion is below. Out of this EUR 1.7 billion, which is on the asset side, it's cash. Okay? EUR 400 of that, we registered as liability, as deferred revenue. Why? Because percent of completion is lagging to the percent of cash received. You can anticipate this is revenue to be recognized in the next quarters, assuming that pace of construction will continue and accelerate, as we say.
Yeah. Understood. Thanks, Apostolos. Thanks, Harris. This is really helpful. Another question partly following on this. We have seen, especially in the last couple of quarters, some encouraging CapEx acceleration, which I think also translates into activity acceleration. Can you just give us a high-level update on where do we stand relative to the total for the first phase, ideally also including the malls in this bucket? We see that outside of the malls, around EUR 1.1 billion-EUR 1.2 billion has been spent. What is the total for the first phase that still is yet to be spent, including infrastructure, including The Ellinikon Mall, et cetera, and over how many years do we expect to get there?
Look, on the CapEx, yes, there's been a significant acceleration. I think that on a percentage basis, on a year-over-year basis, we're over 50% high or one and a half times of what it was last year. We basically registered about EUR 125 million of CapEx for the quarter only. We have a target of getting to EUR 1.6 billion of CapEx through the end of the year, and we feel comfortable with reaching that target. That compares to cumulative through the end of last year, was about EUR 1 billion. You're talking about times and a half, and the cumulative also includes years starting in 2022 onwards. I think that answers the first part of your question. As far as the malls go, Harris, do you have-
On the malls, Jakub, on the CapEx, on the construction cost, we're talking about for the total two malls, roughly about EUR 800 million. We are currently around EUR 150 million to close to EUR 200 million already spent, primarily for the Riviera Galleria, the small mall at the coastal front. The big one, which has the biggest CapEx, we just started a few weeks ago, the construction works. This is anticipated the next, I would say, three years to be fully reaching the EUR 800 target. So from currently almost EUR 200 to EUR 800 in the next, I would say, three years.
Got you. Thanks very much. Sorry, just a quick follow-up on this. Beyond this EUR 1.6 billion for the projects in The Ellinikon, but outside of the malls, what would be the figure that we would be looking at based on the current up-to-date estimates by the time that everything that is dedicated to the first phase, including the infrastructure, including all of the resid projects, are completed?
Jakub, I think that, especially on the infrastructure front and the residential front, the project sort of rolls and rolls on a year-to-year basis. That's why we have elected to give you guidance specifically for the year, and you can judge us against executing that guidance for that year. I think we'll stick with that. Obviously, that will become cumulative as projects complete.
Understood. Thanks. Then, last of the three questions, I'm sorry, because they merged into more questions actually, or dispersed.
We're counting six already.
I promise this is the last one. On the island land sale, just where are we in the process, and can you indicate what, if any, issues or bottlenecks are there in the negotiations, and how likely do you perceive closing or anything you can share on this front?
Yeah, sure. I think that the due diligence has essentially been completed to date, and we're in the process of the negotiations for the SPA documentation. The SPA documentation is a difficult one. I remind you that it's a big project, right? It's a large project and it's a complex transaction. In any case, I think we should know where we stand within a couple of months, one way or another. That's really the color that we can provide right now.
Mm-hmm. No, that's helpful. Thanks very much for bearing with me through all the answers. Appreciate it.
Of course.
The next question is from the line of Martyn King with Edison. Please go ahead.
Hello. Thanks for the presentation. Just changing tack. You've kept up a strong pre-letting rate on The Ellinikon Mall. Is that a stable group of retailers, or do you get some shift in that? Is there any change in the underlying terms on those heads of terms? What sort of occupancy would you hope to achieve at the point of opening?
Look, in terms of change, I don't think there's any material differences. Just in terms of an update, the Riviera Galleria is at 76%, and I'd say the only material thing there is that the number of heads of terms that are being converted into final contracts has increased. By the way, at a very healthy lease rate of over EUR 80 per GLA square meter. The Ellinikon Mall is further out, but it still has 70% agreed upon on heads of terms. Again, at a very healthy rate, over EUR 55 per square meter, which is a good premium versus our existing malls as well. Does that answer your question, or was there another part to it?
Yeah, unless you've got a crystal ball, you know what sort of occupancy at opening.
No. Look, I don't know. I would expect that, especially for the Riviera Galleria, which is the first one coming, I think that it's going to have a very good performance, primarily due to the fact that there's no other organized shopping and F&B destinations in the southern suburbs, right? The main attraction, if you wish, is the main streets or the high street of Glyfada. I think it's going to be a new and exciting development for the community, and I would expect them to respond very favorably to it.
Yeah. Okay. Thanks. On the Agios Kosmas Marina, is this a low point in the contribution? Obviously, a lot will change when it relaunches, but how quickly might that then pick up? I think previously, it was a short sort of EUR 5 million of EBITDA. What sort of ambition have you got on when it's stabilized on its refurbished level?
Yeah, I think that it is a low point. I think that's what you asked, if it's a low point. I think it's a low point in terms of capacity utilization. Look, the very encouraging thing is that Marina Flisvos is making up for the lower utilization of Agios Kosmas, which is very good for the group results of the marinas. As far as completion goes, we're probably talking about the end of the year in terms of completion of construction, and I would expect vessels to start coming back gradually in Q4 and into Q1 of 2027. You touched on a very important point, which is that this is a renovated marina. There's going to be new contracts coming in, and we do believe that those contracts are going to be significantly higher than the ones expiring or the ones that have exited to date.
We do think that there's quite a bit of upside on the Agios Kosmas Marina. Just comparatively speaking, although they're not exactly the same sizes, Flisvos is registering a considerably higher EBITDA, both marinas have about the same number of berths. It's not an exact equality, it gives you a bit of an indication as to going forward.
Thanks very much.
Our next question is from the line of Stathis Kaparis with Axia Ventures. Please go ahead.
Hi, everyone. Thanks for taking my question. I've only got one left. Just a clarification on the VAT as operating costs. Trying to understand the infraworks CapEx was EUR 22 million in Q1 2026. How do we think about that? Is it 24% of that you have to pay, therefore the EUR 12 million of operating costs that relate to non-recoverable VAT relate to previous periods as well? Going forward, I suspect, how should we think about that?
Yeah.
Thank you.
Stathis? Yeah. This is Harris. Let me take that. Thanks for cutting up the exact numbers. Indeed, you should consider it's not only infra. The main is infra, but let's say that this is the main driver. You are correct. You should think it about 24% of the 22. If you do the math, does not add up to EUR 12 million. It adds up to EUR 25 million, EUR 22 million. Why you have EUR 12 million? Because the invoices received in Q1 also refers to accruals of infra for Q4 2025. We have reversed, of course, these accruals, but the VAT has had to be expensed in Q1. That's how it adds up to the EUR 12 million. If you normalize it, that means that the EUR 12 million is around EUR 6 million, roughly for the 22.
If you consider that these are going to be the levels of infra and most probably a bit increased, I would say EUR 6 million-EUR 8 million quarter-over-quarter should be the VAT related to infra.
I see. Thank you. This is already included in the calculation of the gross margin of 40% for the Little Athens projects that CBU does, right? Oh, no, sorry. You said gross margin 40%, it doesn't apply here. Sorry.
Correct.
Okay. It makes sense. All right. Thank you.