All right, welcome to Citi's 2024 Global Property CEO Conference. I'm Smedes Rose of Citi Research. We're pleased to have with us W. P. Carey and Jason Fox, CEO. This session is for Citi clients only. If media or other individuals are on the line, please disconnect now. Disclosures are available on the webcast and at the AV desk. For those of you in the room or on the webcast, you can go to liveqa.com, enter code GPC24 to submit any questions. If you don't want to raise your hand, or if you're here in the room, you're obviously welcome to use one of the many mics that we have available. Jason, a minute, turn it over to you to introduce us to who's with you from the company. Give us a few opening remarks on W. P.
Carey, and then what I'd like you to do is segue into kind of your top two or three reasons why you think investors should be buying the stock today, and then we'll go into some Q&A. Thank you for being here.
Sure. Thank you for hosting us, and thanks to you all for joining. With me today is Jeremiah Gregory, who heads up Capital Markets with us. We've also included Brooks Gordon today, who's our Global Head of Asset Management. Again, thanks for having us. So quickly on W. P. Carey, we are a global net lease REIT, been around since 1973, with a total enterprise value of in the low $20 billion range. And we primarily focus on sale-leasebacks. The portfolio is comprised of about 60% industrial assets, with the bulk of the balance being in retail, predominantly in Europe, but also in the U.S. In terms of the reasons to invest in us, I think there's really two primary reasons right now.
I think number one, we had an overreaction to our recent earnings call, so we think there's a really good entry point into the pricing right now. Number two, we have an extremely favorable liquidity position. We're sitting on about $1 billion of cash to invest, with visibility to generating another $500 million of cash through free cash flow and other dispositions associated with our office sale program. We also have a credit facility that's largely undrawn, a $2 billion credit facility, and additional capital sources to the extent that we see good opportunities in the investment market. We are diversified. We think the opportunity set for sale leasebacks right now is very strong, given the continued dislocation in the credit markets. And we've seen some particularly strengthening fundamentals in the transaction markets in Europe, which have largely been frozen over the last 12-24 months.
So we think there's a good growth story going forward and certainly a good entry price currently right now.
Okay, so just maybe to recap your key kind of bullets, if I can just try to summarize. So first, you think attractive valuation, given the fourth quarter call that was kind of bumpy, and I think stocks pulled back on that. Favorable balance sheet with investment capacity and diversification across geographies and tenants. Fair?
Yeah, that's fair.
Okay. So I do have fourth quarter questions, but I thought maybe we could just start with a couple of just kind of bigger picture. If you could just talk about your 2024 sort of outlook without additional capital, remind us what are the sources for acquisitions here, and kind of there's a few moving pieces on the sales front. So just help us think about how you're positioned without having to raise additional equity at this point.
So only sources of capital to fund the acquisitions. Was that the main part of the question?
Yeah.
Yeah, sure. So I mentioned that we are capitalized with about $1 billion of cash right now. Those are primarily generated through the office separation transaction that we announced last fall. It includes meaningful proceeds generated from our office sale program, which totals about $800 million, about three-quarters of which, or a little over 80% actually, is completed at this point in time. We also settled some forward equity in the fourth quarter that have added to our dry powder. And then more recently, in the first quarter of this year, we completed the tenant purchase option back to U-Haul, which is just under $500 million. So as I mentioned, that's $1 billion of cash we're currently sitting on our balance sheet. Another $500 million of sources can be attributed to further or the final pieces of the asset sale program, in addition to some other expected dispositions this year.
We've also lowered our payout ratio in the fourth quarter to generate more free cash flow. That should add about $250 million. So $1.5 billion of visibility into cash generation for this year. And what that means is that we can fund the midpoint of our acquisitions guidance without having to issue any equity this year. In fact, we probably don't need to be in the capital markets at all. It can afford to be opportunistic, even on the debt side, given our cash position and the fact that our credit facility is largely undrawn.
Okay. And just on the dispositions activity, just remind us where you are on office. I know you've completed the bulk of it with the sale in Spain of that portfolio, but what about $200 million left to go on dispositions on that front?
Yeah, let me turn it over to Brooks so he can dig into some of those details.
Sure, yeah. So when we discussed the program in September, we estimated around $800 million in US dollar total proceeds from the on-balance office dispositions. We're about 82% through that. So what remains is about six buildings. We're in various stages of processes with those, targeting the first half to complete those. So making good progress. But as you mentioned, kind of the bulk of that has already closed. The biggest piece was the Spanish government portfolio, which we have closed. So making good progress on it, confident we'll get that done.
Like first half, or?
Yeah, hard to pin down the precise closing date. That's what we're targeting, first half. All of those six buildings are in various stages of process.
Jason, do you think, and again, just being kind of a newcomer to the story, I mean, were investors happy to see you spin and create the NLOP office and kind of reduce your exposure there?
Yeah, look.
Seems like the stock hasn't performed as well as maybe you would have thought it was. What are your thoughts?
The what has performed as well as he thought it was?
It seems like the shares of W. P. Carey didn't really rally on the spin of the office segment, NLOP, sorry. And I'm just kind of curious how you think investors interpreted it and maybe how you think they should have interpreted it and kind of just your thoughts on that spin.
Yeah, and maybe you're referring to the initial reaction to the announcement in September. Like any public company, when you make a strategic announcement, it's going to surprise some people. And I think that what we did was our choice was to rip the band-aid off. I think that it's probably hard to argue that a portfolio without office is going to be less attractive than the same portfolio with office. So by and large, there's been very broad support of the composition of our portfolio right now. There's a clear understanding that we've eliminated a lot of the headwinds to growth going forward that we think we were going to experience with office releasing. I think the expectations around office, as we all know, the fundamentals will continue to get worse is our expectation.
So that cleaned up the composition of our portfolio, and we think removed a bit of an overhang. And that's been the response. I think if you look at the several months after the announcement, we performed quite strongly. In fact, we picked up about 2 turns of multiple from pre-announcement to mid-January during that time period relative to our net lease peer set. So meaningful outperformance, perhaps what we expected to pick up, I think we realized within the market.
Okay. I think your full-year acquisition outlook sits around $1.5-$2 billion year to date, or at least as of your call. I think you've done around $227 million committed or completed. Maybe just kind of speak to the visibility of the pipeline. That's been a big theme on the fourth quarter calls, the tenor of your conversations. Then maybe I have a couple of follow-up questions. Maybe we start with that.
Yeah, sure. Yes, we did about $200 million of deals through the earnings release earlier in the month. We also talked about $100 million of build-outs or expansions or other capital funding projects that are currently underway. Those will complete this year, and effectively, we have full visibility into their addition to our deal volume for the year. So at that time, we were about five weeks into the year with about $300 million of visibility. We also talked about a building pipeline of assets at varying stages. I would characterize them as a number of medium-sized, kind of the $50-$150 million deals that we're in the process of bidding on. We've seen transaction activity increase, I would say, beginning in the fourth quarter and through the first quarter. This is particularly the case in Europe, just to give you some context.
Europe saw a much more severe increase in rates. The context is the peak of the credit markets. We borrowed in Europe 8-year euro bonds at under 1% compared to quotes we got in Q3 of last year that were in and around the 7% range. Clearly, we weren't an issuer then or needed to issue. Just to give some context of the magnitude of the changes in the credit markets in Europe. It wasn't just the real estate transaction market that froze. It was really across the credit spectrum. If we fast forward to where we are right now, we see visibility into bond pricing in the mid-4s, a direct euro issuance. If we were to issue bonds in dollars and swap to euros, we could probably pick up a little bit more yield at the same time.
So we're not back to where we were in 2021, but we're certainly a meaningful ways from the trough of the cycle in the fall. That's translated into a pickup in transaction activity. I think the seller pent-up supply that's been on the sidelines for the better part of a year to year and a half is starting to come back to the market. Our ability to fund deals is a big component of that, and we've talked about our liquidity position and how that gives us confidence. So I think Europe is loosened up. Again, to put in perspective, last year, about 10% of our deal volume was in Europe. If we just had a modest or a typical European year for us, our deal volume would have been closer to our target of $2 billion last year. But instead, Europe was pretty much nonexistent.
We've seen that come back around for us. The fourth quarter, we did some deals in Europe. I think the majority of the deals we've announced year to date have been European. And I would characterize our pipeline as probably being 50/50 split between the U.S. and Europe. So I think that's a good dynamic that we're seeing. Cap rates are, I would say, roughly in line with where they are in the U.S. Call it in the sevens of what we're targeting. Yet our borrowing costs in euros are starting to return to the historical relationship that we've seen with the cost to borrow in the U.S. It's probably about 100-150 basis points of spread between the cost of the two, which allows us to start generating wider spreads in Europe, which is why we're a little bit more bullish.
I still would expect us to be a meaningful buyer in the U.S. for this year, but the context is that we're seeing good opportunities in Europe. I would expect that as the year continues, we'll see more of that. In the U.S., I think with the expectation that the second half of the year we'll begin to see interest rate cuts, I think we're also going to see a lot of the sellers that have been on the sidelines come back into the market. In particular, with sale-leasebacks, where there is a use of proceeds that drives transactions, those sellers are a little less market timing and more looking for the best alternative. We still think sale-leasebacks are priced very attractively relative to the alternative capital sources that company can raise.
I think in particular, if you look at a sub-investment grade company, high-yield debt spreads are still wide, which allows us to be quite competitive on the sale leaseback front.
Just, you said maybe probably a 50/50 split between the U.S. and Europe. Kind of, what's the focus of investment in Europe? Is it more retail or industrial?
It's going to be a split between the two. I would say the expectation without having visibility into what the year is going to bring, of course, we would likely still be more heavily weighted towards industrial. Historically, it's been, call it, 2/3, 1/3 in Europe. And I would expect that maybe we'd have some overweighting there as well.
Is the market in Europe so deep that you don't come up against other kind of U.S. or European companies, or is the net lease market a triple or sale-leaseback market there sort of behind the U.S., or is it well understood and very sophisticated? Or kind of just give us some context around your investment activity in Europe?
Yeah, I mean, there's two parts to that question. In terms of the investment opportunity set, there is a higher percentage of owner-occupied real estate in Europe. So I think that the opportunity set is as large or larger than the U.S. I think I've seen varying numbers, and it's hard to put an exact number on it, but it's in the order of magnitude of, call it, $6-$8 trillion of owner-occupied real estate. So it's a vast opportunity set. In terms of the competitive landscape, it is less developed. There are no public REITs that have historically focused on pan-European sale leasebacks. I think that we've tended to compete against pension funds and other private buyers on a country-by-country basis, but it's not that often that we see a pan-European buyer. And that's a big competitive advantage for us.
I would say a large percentage, maybe as of recent, the majority of our deals in Europe over the last 3-5 years have involved multi-country transactions, which really puts us in a strong position when pricing and negotiating those deals. There are very few U.S. buyers that compete in Europe against us. Realty Income clearly is one that has moved to Europe over the last couple of years. I think that's been a benefit to us. I think that they've always had a big following of U.S. investors, and I think it's shined a brighter spotlight on the benefits and value creation opportunities of being in Europe that we've realized and enjoyed for quite some time now. But it is a big market.
We don't run up against them as often as one might expect, but we're both well-capitalized companies, and I would expect to see them from time to time. Maybe more going forward, but I think that we're certainly well-positioned to compete given our track record of executing in Europe and, again, the liquidity position that we're in currently.
I mean, one of the things that's come up around Europe - and I'm just curious as to you agree with this - is that when you're working on these cross-border deals - well, I guess there's not any currency issues, but cross-border deals - that they can take longer and be more complex and therefore take longer to close and that sometimes the cap rates can move away from you as your costs are going up and they become maybe less secretive versus just doing a simpler, shorter-term deal. I'm just curious if you have any thoughts on that. Do you think that's true, or is there any merit to that observation?
Yeah, no, I think that's a fair observation. I think generally, sale leasebacks are a little bit more complex in the front end. It could be tax and accounting matters to consider. Certainly, there are lease negotiations that take place. In these larger sale leasebacks, there's broader due diligence that occurs as well. But I think that complexity is really a competitive advantage for us. It's going to eliminate a big part of the universe of potential buyers. Very few investors, especially those of our scale, have the track record of execution in Europe. So I think that what that means is we tend to get better pricing upfront, stronger structures, longer lease terms, better bumps, the ability to select specific portfolios and cherry-pick the right assets.
I think as a reminder, we tend to focus on critical operating assets, and we do put them on master leases, which provides downside protection. In terms of how, if the volatility in the rate market and how that could impact the attractiveness of a deal, I mean, we keep flexibility. I mean, we're tending not to commit to a deal until it's ready to close. That's the nature of a sale leaseback when you have as many moving parts as there are. So we can certainly absorb some movement in rates, but we can also choose to reprice deals if we think it's warranted and rates have moved enough. By and large, the transaction partners we work with, they understand that these transactions can take them time. These aren't retrades necessarily.
These are repricings that are warranted based on where borrowing costs or other funding costs have moved.
You mentioned you think it's an attractive entry point given some of the pullback following the fourth quarter results. There were, again, news to me. There were kind of three things that stood out to me that felt like they were a surprise, and I thought maybe we could touch on them, and you could add, and if anyone else in the room wants to ask. The first I wanted to ask about was the Hellweg restructuring where you'll receive or they receive $7.5 million of rent abatement and about a $4 million decline in rents annually thereafter. I think it's about a 13% total overall decline for year one. And I guess the first question is, what gives you confidence that that's enough?
When you've had restructurings - I'm sure you've had others in the past - is round one enough to kind of reset those rents, or how are you thinking about that credit going forward?
Yeah, sure. Let me let Brooks dig into the details. He was the primary coverage person for this.
Yeah, no, it's a good question. I think what gives us some comfort there is that we worked closely with not only the company but the rest of their key stakeholders and the restructuring of their leases from broadly their major landlords, some additional equity from their ownership family, as well as additional liquidity from their lenders, and their advisors. This was the package that they sought and got all of the stakeholders comfortable that this puts them in a much better position. That said, we're going to keep them on our credit watch list, and they will need to operate through this slower period of time. But we do think the actions that we and the other stakeholders have taken have put them on a much firmer footing to execute through this.
How long did you know kind of internally before you announced it publicly that this was going to be an issue?
Yeah, so when we got their Q3 financials, which tend to come on a lag, about a 60-day lag, so towards the end of our Q4, that's when we saw visibility into what was a very sharp decline in their operations in Q3. A few different contributing factors there from our perspective. One, really, the outperformance of COVID. The slowdown for them was quite sharp versus some of the other COVID darling retailers, which we've seen a little bit more of a steadier decline. Theirs was a bit sharper, and I think that has a lot to do with the German consumer really hitting quite a slow patch towards the back half of the year.
So when we sat down with them late in Q4, most importantly, understanding forward-looking, understanding where they were today was crucially important, but then understanding, okay, what does the actual cash flow forecast look like and liquidity picture? And so that's when we began negotiations with the other stakeholders and the company to understand what would it take to put the company on a better footing. And that took some time to execute. When we had our earnings call, we had enough visibility into the structure of that transaction, which hadn't yet closed at the time. It has now that we were comfortable disclosing the specifics of that, and that has closed identical to what we discussed on the earnings call.
Okay. I think the second thing that kind of came as a surprise is the lease expiration on a large warehouse, $6.2 million of annual rents. And in your guidance, you assume that it remains vacant for the year. I guess what's your confidence in getting it leased for 2025? And how do you balance kind of receiving rents versus occupancy or, as we say in hotel world, heads and beds, just get it full and raise rents later? Or kind of maybe what's the status of that?
Right. So that is an excellent property, large building. We are very confident in leasing that property up. I can't comment on a specific transaction until it's actually closed, but we're in active negotiations on that building.
But do you think it'll be—I mean, so in a year from now, would you have pretty high confidence that it can be leased, or is it something that could go on for years before you can lease it back up?
No, no, I'm quite confident we'll have it leased imminently. And what we've included in our guidance was to accommodate the move-in period and free rent associated with a new lease. So we want to make sure that the guidance doesn't include any rent for this calendar year, but we fully expect that to come online in 2025.
All right. And where is that warehouse? Sorry.
In Chicago, just outside Chicago.
Okay. And then, I guess, the third thing that was a little bit of a surprise, the bankruptcy of a tenant with four cold storage facilities, about $5 million and change of rents. Leases, I think you said, were supposed to come back to you in February. Did that take place, and what are your thoughts on releasing that space?
Yeah, so a couple of things. So that is a portfolio of food processing and cold storage in the Central Valley, and it serves a large, high-quality farm operation there. What happened with that tenant - and that is one that had been on our watch list for some time and had been operating in bankruptcy - really, the change there was that their creditors changed course and decided to sell the underlying farmland versus restructure and operate as a going concern. What remains true is that our physical real estate is quite important for the underlying farmland. So they are in process of selling the land to competing farmers in the area. Obviously, it's very desirable farmland. And as you might imagine, we're an active part of that as those potential bidders look for how they plan to service that farmland.
In terms of timing and guidance, we expect the lease will be rejected end of this month, end of March. It hasn't yet happened, but that's our expectation. From a conservatism perspective, our guidance, again, doesn't include any recoveries for the remainder of this year, but it's something that we're actively working on.
Okay. So relative to guidance, I guess if these things are resolved sooner relative to expectations or to your guidance, that's maybe some upside there in the guidance outlook.
Correct.
I mean, just in terms of communication with investors, I mean, it felt like it was sort of like boom, boom, boom. There were a lot of surprises on the call in what has typically been a fairly straightforward kind of sector. I mean, do you think it would be better to kind of let them as soon as you know about them to communicate that to investors, or is it just your policy to kind of wait for the fourth quarter and kind of bring it all out at once? Or how do you think about that, and what was sort of the reaction from investors when they followed up with you post your call?
Yeah, I mean, with respect to Hellweg, I mean, Brooks had talked about the timeline some, and the acuteness of the change happened intra-quarter. We began the restructuring with them early December. They were current on rent. It was at that point in time we began the restructuring that we did put them on our watch list, but they were current on rent in December. I think there's reasonable expectation that they could have stayed that way for some point in time. I think Brooks talked about why it was important to be proactive and get more of a global restructure in place to make sure the company had the right liquidity going forward. But we didn't have anything to disclose intra-quarter. This was something that we didn't have visibility into what the final outcome would be. We were hopeful it would happen.
It would be in place close enough to the earnings call where we could talk about it, and we did at that point in time. But there are sensitivities around what we can say with private companies, especially retailers. And again, the fact of the matter is we didn't have anything concrete to disclose until that we were far enough along and could do so during the earnings call. But we understand the surprise nature of it. I mean, we've, through the years, performed quite well through lots of credit cycles. I would certainly characterize this as a unique situation, an isolated event. We did provide meaningful disclosure last week to try to help investors understand maybe a deeper look into our portfolio. We expanded our top tenant list from 10 tenants to 25 tenants, which I think covers about 40% of our total ABR.
We expanded the information that we include in our top 10 to show the size of companies. I think one thing you should notice is that most of our companies are very large companies, which means that to the extent there are any credit events, they tend to restructure. And when we own critical operating real estate, we tend to be made whole during that process. I think the other things that we disclosed was a chart on company ownership where the majority of our companies are either public or family-owned. A minority is private equity-backed. That was a question we had received. And then we also did a deeper dive into the do-it-yourself European market to address questions we've had about that sector given Hellweg's experience.
We can dig into that, but kind of the punchline there is that the rest of our do-it-yourself retailers in Europe are on very strong footing. The industry has slowed as it has in the U.S. I think we've even seen Home Depot have a number of sales decreases over the last number of quarters. But the rest of our companies are very well-capitalized, market leaders, strong operators, and no real concerns from our perspective on the credit side.
Okay. Well, maybe just on that, sort of another question that people kind of ask in every meeting and every call is, could you just speak to kind of what you're seeing on the tenant watch list and kind of your credit loss expectations? I don't know if you've said what you've embedded into guidance, but maybe just thoughts around that.
Yeah, Brooks, you want to take that?
Sure. Yeah, so we talked about this on our earnings call, and we want to be really clear about that. So I'll just reiterate it. So we have the two situations we just discussed in Germany and in California. And then on top of that, our guidance includes 70 basis points, which is in addition to those impacts for broader credit loss estimation. And that's conservative relative to our long-term credit loss history, which is more around 50 basis points in any given year.
Okay. And then tenant watch list?
In terms of?
Expanding. I mean, is it growing? Are you putting more tenants on the watch list?
Right. Well, Hellweg's a larger retailer, so that does expand. It's around 4.5% by ABR. In terms of tenant count, it's not a long list. I believe the number is a dozen tenants or thereabouts. So Hellweg certainly is the larger of the bunch. I think important to note that the credit watch list infrastructure is really a dynamic management tool. It's one where we're using it, among many other tools, to kind of monitor companies and bubble them up to the top of the list. It's equally likely that tenants will come off the credit watch list as they will go on, and that happens on a recurring basis. I think one example of that is we tend to have companies that when we invest in them, they may be smaller or they may be targets of M&A.
Many of the companies that we've invested in over the years have actually improved up the credit spectrum as well. So, for example, within our investment-grade bucket, which is not typically our target market from a new investment perspective, over half of those tenants on the investment-grade list, sorry, were formerly sub-investment-grade tenants that have migrated up the credit spectrum as well. So that migration is dynamic. This is the time of year when we tend to receive all the audits. Those come out around 90 days after year-end. So we spend a lot of time with management teams, and so we'll be digging in on those in the coming months.
Okay. I wanted to touch too just you have a number of operating assets that you've talked about, I think mostly in self-storage and then a handful in the hotel space. And I think, am I correct, you have 89 self-storage facilities that are kind of on an operating basis, and you've talked about kind of flat year-over-year NOI out of that portfolio. All the public self-storage companies are all guiding to down same-store NOI year-over-year. And kind of what gives you confidence that you can sort of outperform on a relative basis relative to the folks that really do nothing but self-storage?
Yeah. I mean, that was our view as of our earnings. It's based on budgets, working with the major operators, and their views within our portfolio of what to expect. So it's hard to predict exactly what the year will bring forward, but I think that flat is where we are right now. Could that change up or down slightly? Sure, throughout the year. But it's mainly informed by the large public REITs that our operators are providing our budgets for the year.
Within their outlook, it sounds like your assets must be kind of better than the overall sort of average of the portfolio if they think it can do 0, but they're guiding down to like 2 or so, say, for their overall portfolio.
Yeah. It's very market-specific, of course. I think our concentrations are in, I believe, Florida and California. So that's going to drive some of the performance there.
Okay. Okay. So fair enough. And then, I mean, over time, I mean, do you plan to keep those as operating assets, or would you look to sell them or get them into some sort of net lease, or what's the?
Yeah. I mean, I think all the above is probably the answer. I think that we have lots of options to consider with our operating self-storage. We've been in the space for a long time. We first got into self-storage in 2004 through the large U-Haul sale-leaseback that we did. Through the funds that we used to manage, we did acquire a substantial number of self-storage operating assets, which are the ones that we now own on our balance sheet through the mergers with the CPA programs. We have historically converted some of the assets to net lease, in particular with Extra Space. We like that dynamic. I think that there are opportunities potentially to do some more of that going forward.
But look, storage, while the growth has slowed down, it still trades, I would say, historically almost entirely over the last number of years well inside of where net lease trades. And when we look at opportunities to fund deals going forward, we certainly have a lot of cash on hand. We have a very well-capitalized balance sheet. We have other pockets of capital like our Lineage Logistics investment and some construction loans that we refinance. But certainly, storage is an option. I think that we can probably pick up 100-200 basis points of spread selling out of storage and into net lease. But I think that in the short term, we're very well-capitalized, and we think that looking forward to probably 2025 and 2026, we could see more growth in storage and probably better fundamentals within the space as well.
So save the firepower for later, maybe, on that front?
Yeah. I think it's optionality that's good to have in this environment.
I know we're coming into the last minute and a half here, but I did want to just ask you very quickly. I think you said on your call and also on your company's blog you are expecting an increase in corporate M&A, which you think will drive an uptick in sale-leaseback activity, which would be a positive for you. Is that mostly in the U.S. that you're expecting an uptick in corporate M&A, or?
Yeah. I mean, it's mainly based on the dry powder that a lot of the private equity firms have raised. I think if the rate markets settle, I think that'll also be a catalyst to more corporate M&A activity. I think we can expect to see in both continents, but perhaps maybe more focused on the U.S.
Okay. Last 40 seconds. So as we think about this net lease industry in 2025, what do you think kind of same-store/organic growth can be?
I think for the net lease look, it's hard to determine. I don't think many people disclose a comprehensive same-store. We do, of course. I would say somewhere between 0% and 1%.
Okay. You think there'll be more, fewer, or the same number of public companies in the space a year from now?
Fewer.
For WPC, buy, sell, build, redevelop, or repurchase stock, what's the best decision for you now?
Yeah. Given our liquidity position, buy.
Buy. All right. Thank you so much for your time. Appreciate it.
Yeah. Great. Thank you. Thanks, everyone.