Good morning. My name is Kelly, and I will be your conference operator today. After the speakers' remarks, there will be a question and answer session. Thank you. Archana Sharma, you may begin your conference.
Thank you, Kelly, and good morning, everyone. Welcome to the Choice Properties REIT Q3 2018 conference call. This call is also being webcast simultaneously on our website at choicereit. Ca. Before we begin, we would like to advise you that some of the statements made this morning may contain forward looking information, including statements concerning Choice Properties' objectives, strategies to achieve those objectives, as well as statements with respect to management's beliefs, plans, estimates, intentions, outlooks and similar statements concerning anticipated future events, results, circumstances, performance or expectations that are not historical facts.
These statements are based on our current estimates and assumptions and are subject to a number of risks and uncertainties that could cause actual results to differ. We refer you to the cautionary statements contained in our financial reports, including the MD and A for the quarter ending September 30, 2018, and other public documents for the full details. These forward looking statements are made as of today's date, and Choice Properties REIT assumes no obligation to update or revise them to reflect new events or circumstances, except as required by law. On today's call, we have our Chief Executive Officer, Stephen Johnson our Chief Operating Officer, Rail Diamond and our Chief Financial Officer, Mario Berafado. I will now turn it over to Steven.
Thank you, Kelly, and thank you Archana. Good morning, everyone. Thank you to all of you for taking the time to attend our Q3 conference call. So the 1st the 3 month period ending September 30 marks the 1st fiscal quarter for the merged entity of Crete and Choice. I'm very pleased to report that our financial results for the quarter met our expectations.
The combination of Crete and Choice was a transformational transaction. The result was the creation of Canada's largest and preeminent real estate investment trust. Crete now has an enterprise value of just under $16,000,000,000 Our business has for the most part now evolved into 2 functional areas, our income producing property portfolio or our IPP portfolio and our development business. Our IPP portfolio generates a high quality rental revenue stream. Net operating income on an annualized basis is just over $900,000,000 and there are contractual rent escalations in a significant part of our IPP portfolio.
We expect our IPP portfolio to provide income stability and net operating income growth over the next number of years. Our Development business is divided into 5 categories, including retail intensification, redevelopment, greenfield, major mixed use and residential projects. In our current development program, we anticipate investing approximately $1,200,000,000 of which $470,000,000 is already invested in PUD or property under development. The bulk of the balance of the $1,200,000,000 will be invested to complete our high quality residential projects now at various stages of development within the Greater Toronto Area. It is also significant to note that beyond the current development program of approximately $1,200,000,000 we have a pipeline of additional development opportunities on sites already owned.
It's too early to credibly quantify the total extent of this opportunity, but we expect it to be meaningful over the long term. Our Development business is a very exciting part of our REIT that will add high quality assets to our portfolio and we anticipate will contribute to growth in our net asset value. I would also like to mention that on November 1, Loblaw and George Weston Limited completed a reorganization under which Loblaw spun out its 61.6 percent interest in Choice Properties to its majority shareholder, George Weston Limited or GWL. This transaction results in our major shareholder becoming GWL with a direct ownership of 65.4 percent in Choice. Although no approval was required from the Choice Board of Trustees or the Choice unitholders for the spin out, the Board and management of Choice were supportive of the transaction.
This reorganization improves clarity for all Choice investors as we continue to reposition and grow our business as a major property owner and developer. Through its direct ownership and choice properties, GWL is committed to support our growth as a long term owner, manager and developer of a high quality diversified real estate portfolio. This transaction will have no impact on our ongoing relationship with Loblaw. All current agreements with Loblaw, including the strategic alliance agreement and leases will remain in place and Loblaw will continue to be our largest tenant and the Loblaw relationship will continue to create ongoing opportunities for our REIT. Since closing the CREECH Choice transaction on May 4, our management team has spent a considerable amount of time working on the integration of the Choice and the CREECH businesses.
This involves and continues to involve many important steps, each of which must be completed in the context of a long term business model and strategy for the combined entity. In addition to combining our real estate portfolios, the merger also included the joining together of 2 of Canada's leading real estate teams. Our focus has been on aligning the organizational structure to further enhance our operating platform and we have organized and reorganized our groups to foster collaboration and teamwork and to strive for excellence. We are pleased right now with the progress made on the integration to date. One additional point of interest is that we have initiated some capital recycling.
This is an important step as we position our business for the long term and Rael will provide some details in a few minutes. In summary and from a very macro perspective, we are building our business for stability and growth. Our focus will be to position both our IPP portfolio and our development business to grow net operating income, to grow cash flow and to grow net asset value over a long term horizon. Mario will now provide an overview of our financial results for Q3 and then Rael will provide an overview of some of the operational and investment highlights.
Mario? Thank you, Stephen, and good morning, everyone. I'll begin with a brief overview of our results and then comment on our balance sheet. As Stephen mentioned, this quarter represents the 1st 3 month reporting period for the combined operations of Choice Properties and the former Creek business. Overall, our Q3 results were in line with our expectations and reflect the stability that is inherent in our portfolio.
Our reported funds from operations for the 3rd quarter was 169,700,000 dollars or $0.253 per unit. With the exception of $267,000 in lease termination fees during the quarter, there were no other unusual items. On a comparative basis, FFO per unit is consistent with last quarter after adjusting for an additional month of contribution from the CRE operations in non recurring items we noted last quarter. On a year over year basis, FFO per unit declined $0.01 per unit compared to the Q3 of last year, primarily due to the change of capital structure resulting from the Crete acquisition. Looking at adjusted funds from operations for the 3rd quarter, we recorded $137,500,000 or $0.205 per unit diluted.
The AFFO payout ratio for the quarter was approximately 90%. This payout ratio is consistent with what would be our annual expectation. However, in this year of transition, we expect an increased amount of capital spending to be skewed to the 4th quarter, which will result in a corresponding decline in AFFO when compared to the Q3 of 2018. Included in our results was a stable quarter over quarter growth in our same property cash NOI. For the quarter, same property cash NOI, excluding development activities, increased by 1.6% to 146,200,000 dollars from 144,000,000 in the Q3 of 'twenty seven.
Furthermore, our overall period end occupancy was 97.7%, up 10 basis points over the Q2 of 2018. This is primarily due to positive absorption in the industrial and office portfolios. At period end, retail occupancy was 98%, industrial occupancy was 97.8% and office was 92.9%. Overall, very solid operating results. Now turning to our balance sheet.
Our book net asset value was effectively flat quarter over quarter as our net earnings for the quarter were offset by cash distributions and an adjustment to the fair value of our investment properties. The adjustment to our fair value properties was a loss of $38,000,000 and was attributable to slight changes in property specific leasing assumptions and an alignment of cap rates within the portfolio. During the quarter, we closed on the sale of a portfolio of older generation industrial properties in Halifax for $17,000,000 Subsequent to quarter end, we entered into agreements to acquire 5 income producing properties for approximately $105,000,000 and to dispose of a 50% interest in an office property approximately $100,000,000 Rael will provide more color on these transactions.
We continue to be active on
the development front with ongoing investment through additional spending of $75,000,000 in the quarter and the transfer of $96,000,000 of development properties to income producing status. From a financing perspective, we completed approximately $40,000,000 in new mortgages with a weighted average interest rate of 3.8% and a term of 14 years. As well, we did $8,000,000 in new construction loans. We also had $125,000,000 senior unsecured mature during the quarter, which was repaid with funds drawn on our credit facility. Overall, our financial metrics remain solid.
Using amounts from our proportionate balance sheet, our debt to growth book value is approximately 47% and normalized leverage and interest coverage ratios are 8 and 3.1 times, respectively. These metrics are further backed by $1,200,000,000 of liquidity on our credit facility and $11,800,000,000 pool of unencumbered assets. So once again, we're very pleased with the 1st full quarter reporting of the combined entity. I'll now turn the call over to Rael.
Thank you, Mario, and good morning, everyone. As Stephen mentioned, I'll provide a brief overview of our portfolio and an update on transaction activities. Our consolidated portfolio includes 751 properties comprising 67,000,000 square feet of GLA. The portfolio is located across Canada with a concentration in Canada's largest markets. Our retail portfolio is primarily focused on necessity based retail tenants.
This portion of our portfolio is the foundation of a reliable cash flow. One of our key competitive advantages is our strategic relationship with Loblaw, Canada's largest retailer. This relationship provides Choice with an exceptionally strong anchor tenant at many of its retail sites with long term leases that provide us with stable, secure and growing cash flows. We continue to add to our retail portfolio through development, including a mix of greenfield development, redevelopment and intensifications. In Q3, we completed and a total of 290,000 square feet of retail development at a total cost of $84,000,000 This includes 108,000 square feet of intensification projects, which are focused on adding at grade retail density to our existing portfolio of retail assets at a cost of $31,000,000 In addition, it includes 82,000 square feet of redevelopment projects, which are focused on repositioning older assets in key markets at a cost of $23,000,000 And finally, it includes 100,000 square feet of greenfield development at a cost of $30,000,000 including our Overly project, which is a recently completed standalone Costco site in Toronto on a long term land lease.
Our industrial portfolio includes 112 properties and approximately 16,300,000 square feet of GLA. The portfolio includes Loblaw distribution facilities on long term leases and high quality distribution and warehouse facilities in key industrial markets across Canada that readily accommodate a broad range of tenants. In terms of industrial development, Joints owns 85% of the recently constructed 665,000 Square Foot modern distribution facility on Peddie Road in Milton, Ontario. We have finalized a long term lease for approximately 515,000 Square Feet with Kimberly Clark, a multinational consumer products company. The lease will be income producing in January 2019 at rents that are higher than our original pro form a.
We are speaking with multiple prospective tenants on the balance of the space. This asset will be a great addition to our industrial portfolio as it is in the GTA West submarket of Milton, one of the strongest industrial markets in the country. Our residential platform includes or provides an opportunity to further diversify our portfolio. Choice has been working on expanding our residential platform. Currently, we have 3 residential rental assets that are income producing and another 7 residential rental assets that are currently in various stages of development.
And we are also under contract to acquire another rental residential development site located between Grosvenor Street and Grenville Street in Toronto. When complete, these residential projects will represent approximately 1500 units at choice of share, including 800 units located in the GTA. We're excited about the prospect of our residential initiative. The performance of our office portfolio continues to vary in our 2 largest markets. The office leasing market in the GTA remains strong.
There's currently significant tenant demand and limited availability. Our portfolio is almost fully occupied when considering all committed leasing. Conditions in the Calgary office market remained difficult. Imbalance between supply and demand persists and the market vacancy levels remain high. With this in mind, we decided to sell our 50% interest in Sun Life Plaza in Calgary.
This decision was based on several factors including the current market conditions and the lease expiry profile of the asset. Ultimately, we believe there are better uses of our capital including new acquisitions like the Loblaw Bendins and funding our ongoing development program. Subsequent to the quarter end, conditions were waived on the sale of our interest in the asset for proceeds of approximately $100,000,000 This disposition is expected to close in Q4 2018, at which time we'll have more to disclose. Keeping with transaction activities, during the quarter, we acquired a 75% interest in a 6 acre parcel of retail development land in Saint Juli, a suburb of Montreal. The development plans envision a 73,000 square feet of retail GLA anchored by Loblaw grocery store, Dollarama and a liquor store.
This project is currently under development and is expected to be complete by the end of 2019. Subsequent to quarter end, we also agreed to acquire 4 grocery anchored income producing retail properties from Loblaw for total proceeds of $85,000,000 These properties are located in strong retail nodes of Ottawa, Calgary, Halifax and the GTA in total approximately 335,000 square feet of GLA. Finally, we agreed to acquire 130,000 square foot industrial building from Western Foods for approximately $20,000,000 The asset is located in the Greater Vancouver area and is subject to a long term lease. These transactions are expected to close in the Q4 of 2018 and we have more to disclose at that time. That concludes my comments.
I would like to pass it back to the operator for questions. Thank you.
Your first question comes from the line of Mark Rothschild from Canaccord Genuity. Your line is open.
Thanks and good morning guys. Good morning. In regard to the asset sales, you sold some industrial properties in Atlantic Canada. To what extent was that unique to those assets? Or are you going to be trimming of these portfolios?
Is that part of the strategy to reduce leverage? Or will you be looking to actually grow the industrial portfolio?
It's Steven. These assets basically were older generation assets that were in the CREED portfolio for many, many years and just don't suit kind of our long term plans for the industrial platform. We're still reviewing what we're going to do on industrial, but I think our sense is that we will try to grow that our industrial platform to be a meaningful part of our business over time. But at this stage, basically, we're just not committed to that. The acquisition in Vancouver, very, very high quality industrial property long term lease and it just fits in with the industrial platform we have now quite nicely.
The merger the merger with Choice. Will asset sales be a source of lowering leverage or should we expect you to operate at this level over time and then at some point down the road do something else?
We don't have a definitive answer to that now, but we certainly are looking at the potential for some asset sales and the proceeds from that would be potentially used to pay down debt, potentially used to fund our development program. So, but we're just we haven't put a pin in it exactly at this stage. Again, keep in mind, it's early days. We've just finished our 1st 3 months of our 1st full quarter of activities. So some of these things basically as we go into future meetings, we'll be able to provide more color, more narrative.
Okay, great. And just one more question. Is it possible to provide a little bit more information on what you're seeing from the CRE portfolio as far as maybe the industrial portfolio and the office portfolio as far as changes in the same store NOI as far as what we can expect over the next year?
Sure, Mark. It's Rael. So, on the industrial portfolio, it's really operating at very healthy fundamentals, particularly in Toronto, Calgary and Halifax. I don't have the exact growth percentage numbers, but it's probably around 2.5%. In Edmonton, industrial still remains challenging, but our portfolios are very high quality in Edmonton.
On the office side, again, we're not going to see significant growth from the portfolio given in Toronto we largely fall with limited rollover. And then any growth over there would be offset by some further declines in Calgary as we mentioned were very challenging still.
Okay, great. Thank you so much.
Your next question comes from the line of Sumayya Hussain from CIBC World Markets. Your line is open.
Thanks. Good morning. So just keeping on with the capital recycling theme, when you guys are, I guess, evaluating the portfolio for potential sales, Is there any sort of preference or priority to selling the old CREED assets versus the old choice assets? Or you just kind of look at the portfolio in its entirety?
We would be agnostic to where they came from. Basically, do they fit in our long term plan? So whether it's CREIT or Choice, it doesn't really matter. Yeah. It would just be quality of overall quality of assets is the defining will be the defining criteria.
Right. Okay. And then just moving on to the major mixed use developments and knowing the slightly new disclosures this quarter and the predevelopment timeline of 2 to 5 years. So just of the 3 projects listed, can you remind us which ones are the most advanced? And if you could just give a status update there?
Just the all three basically we're moving through kind of an entitlement process. And the timeline that we disclosed basically is realistic, but I mean these things can change as you get into hurdles or changes in potential design.
We're kind of at the same timeline there. And then just following up on the 60 sites identified previously, Just how static is this number? And are you continuing to review the portfolio? And is there a possibility that, that number could grow over time?
This is the places for future development on the sites for future development. Yes, I mean, it's it could grow over time. I mean, we're basically, it's a large enough number and there a significant number of opportunities, it could quite easily move up or down by a few.
Okay. Thanks. I'll turn it back.
Okay. Your next question comes from the line of Mike Markidis of Desjardins Securities. Your line is
open. Thank
you. I know the number relative to the size of your portfolio is pretty small. But just touching on the $30,000,000 roughly $38,000,000 fair value decline that you took on this quarter, was that isolated, I. E. Was it limited to maybe a handful of assets or was it a very small tweak that was specific to certain markets?
Hi, Mike. There's a few parts to it. There was a handful that were property specific, just change in leasing assumptions, timing. The second part was there was a small change in cap rates. Properties in Toronto, Vancouver, you're seeing compression and you're seeing expansion in some of the tertiary markets.
But I think the bigger issue too is also just an alignment where we would have a cap rate on a property that would be in a certain range. As we put the portfolio together, we noticed that other cap rates of similar properties were in a different range. And so we just had to align those a bit. So really a little bit of all those pieces.
Okay. That makes sense. On the sale of Sun Life Plaza, is the $100,000,000 is that a gross proceeds or is that net of debt that's attached to the property?
It's a gross proceeds. There is existing financing on the asset which we have moved to other assets. So it's gross proceeds.
Okay. So gross proceeds. And you may
not have this off the top
of your head, Mario, but do you know what the NOI contribution for Q3 was from that asset?
Q3 would have been I don't have enough. Okay.
No problem. Last question, just a higher level question. Now with the CREET merger over the past several months being completed and the change now in the ownership from Loblaw to Weston in terms of where the your majority position sits. Obviously Loblaw is very important to the organization strategically going forward. But is there any high level thought in terms of where the concentration of or exposure on the revenue side would be going forward?
Is it something that you would expect to try and maintain here? Or is the goal to push it down over time?
So is your question basically would we try to push the Loblaw total percentage down over time?
Yes.
Yes. It will come down by definition given the current development program we have with the if you look at the concentration on rental residential, by definition that will push that down over time. And really going forward, if you look at our development program generally, it will again by definition push that concentration lower.
So sufficient to say it's just a byproduct of your development efforts and not necessarily a broader strategic goal to reduce the concentration?
That's correct. I mean, basically, so whether that's good, bad or indifferent, I mean, it's really going to it's going to happen as a result of our development initiative, our development business.
Thank you. I'll turn it back.
Your next question comes from the line of Pammi Bir of Scotia Capital. Your line is open.
Thanks. Good morning. Just on the Sun Life Plaza sale, can you maybe just provide some color on the cap rate or even the range on that transaction? And with the buyer, your partner or another party?
Party? Pammi, so we've never disclosed cap rates and assets in Calgary at the moment aren't really trading on cap rates, just given the flux of the market. So it's really trading on a price per foot and which you can easily calculate around $200 for our share. The purchase that we can't disclose, but it was not our partner.
And then just I guess if you maybe look, I know you made some comments on the outlook for capital recycling, but would some of the additional Calgary office assets that are left, would they be perhaps considered for sale as well?
At this time, we are not considering selling them. Okay.
As you look at you sort of continue that the whole sort of portfolio review, how much would you estimate is perhaps non core? And I realize that it is early at this stage, but just trying to get a gauge of what we could see down the pipe.
Yes, Pammi, it's Stephen. It's really just too early to tell. As you can tell from our comments this morning and our financial disclosure, it's been a busy quarter. And as Rael mentioned, approximately 750 assets plus our development program is very significant. So, it's just too early to tell.
You have to go through it on an asset by asset basis and it will take us some time.
Okay. Last one maybe just coming back to the comments around cap rates. What are you seeing at this stage from a retail perspective on stuff that comes across your desk? Are you seeing pressure in your particular markets more specifically than others? Or has it been fairly stable?
Pammi, again, it starts with the quality of the asset. Gross market retail continues to trade well, continues to be a bit for it given they're generally small. But what we are seeing just given some of the retail volume on the market, there appears to be some softness, particularly in secondary and tertiary markets, but very few data points to truly point to.
Great. Thanks very much.
Your next question comes from the line of Sam Damiani of TD Securities. Your line is open.
Thank you and good morning. Most of my questions have been answered. But just on the major mixed use projects, a couple of questions. When do you think that one of those might be at the stage of being kicked off in terms of serious money being spent? And also would you consider adding a 4th project to that pipeline in the near term?
So it's Steven, Sam. Good morning. We don't have a date for when we may have shovels in the ground on any of these projects at this stage. So, again, they are in the preliminary planning and entitlement stages and as we work our way through that basically we will be able to give more clarity on start dates. Would we add a 4th one to it?
I mean, it depends on the quality of the opportunity and where it comes down to a capital allocation decision. So, there would be it would depend on the opportunity, Sam.
Okay. So, sorry.
Do you have one for us?
I'll take a look and let you know. Okay. Maybe just over to capital recycling. Your comments, Stephen, were basically messaging that specific sort of plans in that regard haven't been completely finalized. I guess some sort of strategy is being formulated on that front.
And just wondering, when do you think you'd be in a position to message out that strategy?
Yes. Again, in terms of the comments I made earlier in answer to a question, it's early days in terms of the merged entity. And so we're between the integration of the two businesses and our development program and some of the things we're doing on the IPP portfolio, it will just take a time. So, we'll update you from quarter to quarter as we have progressed, but I really don't have a date at this stage where I can say something definitive in terms of what our specific plan will be in terms of recycling.
Okay. And just lastly on the rental residential pipeline, do you have appetite today to add more projects as well there?
The short answer is yes. And the short answer is yes in terms of again dependent upon the opportunity. I mean we've been very fortunate and we were into the Toronto or GTA rental residential market a number of years ago. And we have based on can see from our disclosure, we have a handful of very high quality rental residential assets that are in various stages of development. And so, we come in at a good time.
We're going to add some very high quality assets in that category over the next few years. But if something else comes along, we would certainly take a look at it.
Wonderful. Thank you.
Thank you, sir.
Your next question comes from the line of Tal Woolley from National Bank Financial. Your line is open.
Hi, good morning. I just wanted to ask a couple of questions about the office leasing. You had occupancy tick up a couple of 100 basis points this quarter. Can you give any color on where that leasing was signed?
The leasing was across the board. It was in Toronto, we are almost full. And then in Calgary, we have continued to chip away at some of the vacancy, particularly on smaller spaces, particularly in Alts and Calgary Place.
Okay. And I apologize if I'm not fully up to speed on some of the buildings in the CREEP portfolio, but I know I was aware that I think you had a lease with Suncor that was coming up that you would have to replace this year or upcoming in 2019. Does the sale of Sun Life Place take care of that problem for you?
Yes. That's one of the main reasons we decided to dispose of Sun Life as well.
Got it. And then just lastly, again, you've had a lot going on in the 1st couple of quarters going particularly with the corporate reorg too as well. I was just wondering in your conversations with Loblaw and Weston, was there any discussion about how perhaps being outside of the Loblaw family within Weston like it could there were benefits potentially in terms of accelerating the pipeline or diversification? Like can you give any insight into what the conversations were with the key stakeholders there?
It's Stephen. Certainly, the industrial asset that we announced this morning or announced in that Rell spoke about fell out of a discussion with the Western organization. So that's an area of opportunity for us going forward in terms of possibly growing our industrial portfolio with from the Weston Bakery side of the business. And of course, we've talked about what other opportunities there might be not only from an acquisition perspective, but also from a leasing perspective and so on. So, I mean, they're committed to the support the success of our business and the long term growth of our business.
So, all of those opportunities are now open for discussion and we'll see them as the next few years unfold basically how many of those can be pursued for the benefit of both or all three parties.
Okay. Thank you very much.
Your next question comes from the line of Michael Smith from RBC Capital Markets. Your line is open.
Thank you and good morning. Stephen, I know it's early days, but as you said in your prepared remarks, you're working very hard on the integration of the 2 businesses trying to align the organization. Just trying to get a sense of where we are if you use a baseball analogy as opposed to the 7th inning?
I'm a baseball fan, Michael. But I know in terms of I think basically you made the comment about the first inning. Look, it's the as you know from our CRE days, we view this as a very, very long term business. And as I said earlier and kind of in the opening comments, we are really trying to we've broken the business into 2 main functional areas and our IPP portfolio, which has its opportunities for primarily for stability and embedded NOI growth with the escalations in the Loblaw leases. And then the other main part of our business is the development business.
So So with our current program of approximately $1,200,000,000 it's not small. And so we're not in the first inning. We've got a $16,000,000,000 entity. We've got a wonderful platform. But I guess if you want to keep with the baseball analogy, in the majors, now we're in the big leagues.
And so maybe it's the first inning from that perspective, but as we go through, we have a long term perspective and basically we're building it from that viewpoint. I can
appreciate it. It's a big task and obviously you're looking at it from a long term point of view. Has there one of your key sort of more longer term I mean you've got a lot the go right now with development, dollars 1,200,000,000 and you've got a lot of very big projects coming in the future, very exciting. I think one of the initiatives or one of the objectives at the start of the merger is to beef up your development team. And I'm just wondering where are you on that project?
There are any new hires? Are you thinking about it? Are you still trying to merge the cultures of the 2 entities before you sort of go into hiring mode so to speak?
Yes. Basically, we're thinking about how that how we can continue to improve our development capability. A lot of the remaining spending that we have to do in the Toronto GTA rental residential program, we're doing with joint venture partners. So from that perspective, we're very well equipped to complete those developments. But as we go forward, as we crystallize our plan for what we're doing on development, we'll continue to build an intense or improve, enhance our development capability.
It's going to be an important part of our business going forward, just like the IPP portfolio will be an important part of our business. Those are the two things we focus on, property management and leasing in our IPP portfolio and development capability in our development business.
Great. Thank you. That's it for me.
Thank you, Mike.
And there are no further questions. I now pass the call back over to Stephen Johnson, CEO.
Again, thank you everyone for attending this morning and thank you for your patience. I know there's some questions you would like to have answers to sooner rather than later, but stay tuned. I think we've made great progress in the few months that we've since the merger date in May and we look forward to future calls. Thank you everyone. Have a great day.
Have a great weekend.
This concludes today's conference call. You may now disconnect.