Welcome to American Homes 4 Rent 2014 Third Quarter Earnings Conference Call. At this time, all participants are in a listen-only mode. After the company's presentation, there will be an opportunity to ask questions. (Operator Instructions) As a reminder this conference is being recorded. I would now like to turn the call over to Stephanie Heim, Counsel at American Homes 4 Rent. Ms. Heim, please go ahead.

Good morning. Thank you for joining us for our third quarter earnings conference call. I'm here today with David Singelyn, Chief Executive Officer; Jack Corrigan, Chief Operating Officer; and Diana Laing, Chief Financial Officer of American Homes 4 Rent. At the outset, I need to advise you that this call may include forward-looking statements. All statements other than statements of historical fact included in this conference call are forward-looking statements that are subject to a number of risks and uncertainties that could cause actual results to differ materially from those projected in these statements. These risks and other factors that could adversely affect our business and future results are described in our press releases and in our filings with the SEC. All forward-looking statements speak only as of today November 3, 2014. We assume no obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise. A reconciliation to GAAP of the non-GAAP financial measures we are providing on this call is included in our earnings press release. You can find our press release, SEC reports, and the audio webcast replay of this conference call on our website at www.americanhomes4rent.com. With that, I'll turn the call over to David Singelyn.

Thank you, Stephanie, and welcome to our third quarter 2014 earnings call. On today’s earnings call, I will provide a brief summary of our quarter. I will then turn the call over to Jack Corrigan to discuss the current operating environment and our progress with regard to operations and acquisitions. Finally, Diana Laing will review operating and financial results for the third quarter and update you on our balance sheet and liquidity. On previous calls, we outlined our vision of building the premier company focused on owning and operating single-family rental homes. We continue to see that vision of building a single-family rental home concept be validated. Specifically, we continue to acquire high quality homes in attractive markets. We continue to see high tenant demand for single-family rentals. We continue to experience high tenant retention. And we continue to have strong rental rate increases. As of September 30, we owned 30,877 properties, an increase of 3,704 homes, from the 27,173 homes owned as of June 30. The 3,704 homes acquired included 1,372 homes acquired in the Beazer Pre-Owned Rental Homes portfolio that we acquired on July 1. Excluding the homes acquired in the Beazer portfolio, we acquired 2,332 homes for an investment of approximately $400 million. We expect to invest approximately $500 million in additional single-family assets in the fourth quarter. As of September 30, we had 26,161 leased properties. This is an increase of 2,797 leased properties from June. At September 30, our occupancy percentage of our stabilized portfolio was 94.1%, comparable to the 94.7% in the second quarter. Most impressive are the metrics we continue to see of our own assets. Our tenant retention rate was approximately 70% during the quarter and our stabilized occupancy was 94% at quarter-end. Further, we are seeing strong rental rate increases in…

Thank you, Dave. I'll first give a little color on acquisitions and renovations and then on property operations for the third quarter. For Q3 2014, we acquired approximately 3,700 homes, including approximately 1,400 in the Beazer acquisition. On the 2,300 properties acquired in our traditional channels, we acquired approximately 40% at trustee auctions. We anticipate, we will acquire approximately 2,900 homes in the fourth quarter. We continue to execute on our renovation program. We renovated approximately 1,900 homes in the third quarter, excluding turns, and we expect to increase that pace to keep on track with our acquisition activity. We continue to pursue our non-performing loan strategy. And as of September 30, have invested approximately $30 million in NPL investments, including $4.2 million that have resolved. Of that $4.2 million, it includes approximately 22, which resulted in us acquiring title. The balance remains invested in loans in process of being resolved. With respect to our third quarter operations, our leasing activity continues to be strong, including renewal and releasing activity. For the quarter, we leased a total of approximately 3,800 homes not including renewals, but including approximately 1,900 second-generation leases. This is a slightly slower leasing pace than the first-half of the year, lower available inventory and higher credit standards combined with such pushing rental rates at some effect on our leasing activity. We continue to push our program of increasing rents on second-generation leases. During the third quarter, we increased rents on releasing in excess of 4%. We expect some seasonal slowdown in the – in leasing in the latter half of the fourth quarter. We continue to see strong tenant retention at approximately 70% with rental rate increases in the 3% range on renewals. Despite strong tenant retention, we had our largest number of move outs this quarter. This resulted in higher move out costs, should be noted that our turn costs net of charge-backs per completed turn was in line with our expectations. I want to further address expenses, which were high during the third quarter, partially as a result of seasonality and partially as a result of logistical inefficiencies. This summer brought approximately $1.2 million in air conditioning repairs as many of our homes are facing that first summer as a rental. In addition, transferring the obligation for utilities and long morning has been a logistical challenge for us, resulting in our absorbing costs that should have been the tenants responsibly. We are working on these issues and believe, we have solutions that over the next four quarters, we'll minimize the problems in related costs. With that, I would like to turn the call over to Diana.

Thank you, Jack. I'll review the third quarter financial results that were detailed in today's press release and in the supplemental information package that we posted earlier this morning on our website under the For Investors tab. To better present our operating performance without the effect of certain items, we've defined a measurement that we call core funds from operations. The definition of core funds from operations is outlined on page 7 of the supplemental information package. For the third quarter, our core FFO was $38.4 million, and 8.7% increase from the $35.2 million for the quarter ended June 30, and an 85.7% increase over the prior year period. On a per share basis, core FFO per share was $0.15 flat with the second quarter and a 50% over the third quarter of 2013. On page 4 of the supplemental information package, we calculate net operating income and operating margins for our leased portfolio. For the third quarter of 2014, NOI from our leased properties was $60.1 million, an increase of 5.3% from the $57.1 million reported in the second quarter, and a 90.3% increase over the prior year period. Revenues were $110 million for the quarter, an increase of 17.2% over revenues reported in the second quarter. Please note that the caption titled Leased Property Operating Expenses, includes expenses that relate to properties that are leased and properties that have been previously leased whether or not they are currently leased. So turn costs and other expenses for properties that have previously been renovated and leased are a component of expense in this category and are deducted from our NOI. You will note that we calculate a core net operating margin in which we eliminate from both revenues and expenses the amounts that we bill back to tenants for reimbursement…

Thank you. (Operator Instructions) Thank you. We would like to start with our first question and this comes from the line of Jade Rahmani with KBW. Please proceed with your question. Jade Rahmani – Keefe, Bruyette & Woods, Inc.: Hi, good morning, and thanks for taking the questions. Regarding the upcoming securitization, can you say what kind of term you're expecting to, to look at, and whether it would be a fixed or floating rate deal?

Yes, we – this is Dave. Good morning, Jade. We on our last deal did a fixed rate 10-year deal. We are evaluating doing another fixed rate term, and we'll make the final call as we're going to market based on where the market is for both fixed rate and variable rate transactions, but we do have a preference to finance long-term assets with long term capital, so we’re more inclined to be longer term than shorter term. Jade Rahmani – Keefe, Bruyette & Woods, Inc.: Great, thanks for that. Turning to expenses, I was wondering if you could tell us what percentage of turnover costs and repair maintenance are being capitalized versus direct to expense, and were each are running on a per property basis?

You want to deal with it, expense versus capitalization?

Well, generally the expense turnover costs, unless it is truly a replacement of an item in a home, so the repairs and maintenance and turnover costs are generally expensed. Obviously, and during renovation we are capitalizing renovation costs in replacements. Jade Rahmani – Keefe, Bruyette & Woods, Inc.: Okay. And on the per-property basis, can you provide any color on where those are running?

Yes, the turnover costs are in line on a per-property basis with where we think we will be on a per-year basis. So we don’t see any significant difference there, we had originally guided people to approximately $0.25 per annum wherein that zip-code today. With respect to expenses, as we mentioned, our expenses are running a little bit higher than we anticipated, therefore we are lowering our projected yields on the properties on an annual basis, a couple of points, 61%, 62%.

Yes, that projected margin not necessarily yield, it’s the…

The margin, I’m sorry.

The rents are rates that going up faster than the expenses. Jade Rahmani – Keefe, Bruyette & Woods, Inc.: Okay. And on a per-property or per-square foot basis, where are you seeing those costs running?

On repairs and maintenance? Jade Rahmani – Keefe, Bruyette & Woods, Inc.: Yes.

In terms of recurring repairs and maintenance, I think we’ll be in somewhere in the $600 per property range per year. Jade Rahmani – Keefe, Bruyette & Woods, Inc.: Okay. Thanks for taking the questions.

Yes.

Thank you. Our next question is coming from the line of Janie Wanless with Bank of America. Please proceed with your question. Janie Wanless – Bank of America: Thank you. Good morning. I was wondering if you can comment on the bad debt in the quarter, any trends that you’re seeing there, and when where we kind of anniversary when all of the leases that have been underwritten were by AMH?

Yes, every quarter we have a higher percentage during the third quarter of our rents. I think approximately $60 million were centrally underwritten versus the $44 million or $46 million that were underwritten by others or not centrally by us. And it’s not an apples-and-apples comparison because it’s not the same age, but we’re – about $300,000 of that $2 million in expenses were related to centrally under-written and the other $1.7 million was related to other historical underwriting. We think I mean we’re pretty certain that over time that number is going to come way down and I think I’ve given guidance at about 1%, and that’s where I think it will end up. Janie Wanless – Bank of America: Thank you. And I think historically you provided current occupancy for the portfolio. Can you given an update as of today, or as of October?

Yes, typically we have had a little more time between the end of the month and the conference call, to kind of make sure we scrubbed on the numbers accurately. And we did this call and our earnings release a little earlier to cater to being able to answer questions at NAREIT, so we don’t have the October 31 numbers at this point. Janie Wanless – Bank of America: Thank you.

Thank you. Our next question is coming from the line of Jack Nasinko with SIG. Please proceed with your question. Jack Nasinko – SIG: Hi, good morning. When we think about the securitization for the fourth quarter, size-wise should we – are you thinking about that $400 million to $500 million number or could that be higher?

Well, it could be higher but I think we’ve seen pretty good execution of prior securitizations in that $500 million range. If you look at the execution that we’ve had in that dollar range, we’ve been very, very pleased with the demand that we’ve seen, the ability to build a solid book, when we’re out there and it’s reflected in the rates we’ve been able to get. So I think that’s a good size for the marketplace to get good execution. Jack Nasinko – SIG: Okay. Great. And then on the Beazer acquisition you got fairly large in Phoenix, I mean is that a core market for you to get in now or do you think you could see some divestitures down the road from that slug of homes? How do you think about the dynamics of the market change when you overlay that acquisition?

Yes, Phoenix has always been a core market for us. The prices got higher and we had other opportunities to deploy our limited capital so we went to other markets but Phoenix is a core market and I don’t anticipate selling in the near future any of the homes that we bought in Phoenix. We are selling a couple that Beazer owned that were in rent restricted areas and I would say that will be less than 10 of the 1,372. Jack Nasinko – SIG: Okay. And then, well I have just one more real quick one. 70% retention obviously a good number, indicative of sort of the asset-class relative to apartments. Any intel on where the 30% are going, specifically other rentals on the single side or any color you can give, any trends or broader themes you noticed over the summers yet, a large amount of turnovers from a number standpoint?

Yes, I think, I mean, we don’t have – I mean, a lot of the reasons I give are other – when we do the survey, so it’s probably not totally discernible. But some are buying homes and some are just – they have life changes, they get divorced, they get their kids get out of school or whatever so we get a lot of life changes and other and buying a house.

And moving out of market. Jack Nasinko – SIG: Okay. All right. Thank you.

Thank you. Our next question is coming from the line of Haendel St. Juste with Morgan Stanley. Please proceed with your question. Haendel St. Juste – Morgan Stanley: Hey, there. I guess a follow-up on the last question, just want to make sure or clarify that. And I know it’s early in your lifecycle as a company, but are you specifically tracking the reasons for say, moving out to buy home to perhaps move to another market? Do you have those numbers, perhaps for this quarter versus prior quarters?

We have numbers. I’m not sure at this point we’re ready to publish them, because I’m not convinced they’re 100% reliable. Haendel St. Juste – Morgan Stanley: Okay.

But we do ask the questions and we’re getting better at discerning the feedback but lot of people are more private in their answers than you would think. Haendel St. Juste – Morgan Stanley: Okay. Fair enough. And then to get into the degradation of the margin a bit more, looks like the degradation came from higher turnover, higher R&M. Can you talk a bit more, help us understand how much of this was due to seasonality, pushing rents too hard and how much was related to the inefficiencies you referred to. I would like to get, I guess, some actually specific on what those inefficiencies are and how do you anticipate addressing them? So, some color or perhaps some perspective on reasons for the higher turnover R&M and then – and some more specifics on the inefficiencies and how you plan to address them.

Yes, I’ll talk first about the higher turnover. I think that we cater to families and families will typically stay through the school year and then if they’re going to move – they’re going to move in the summer. So I think that you’re going to see probably annually a kick-up in move-outs during the summer. And as far as the operational inefficiencies, I’ll give utilities as an example of – and it’s just – it’s really a timing issue. We have security deposits that by most state laws we have deadlines in order to reconcile the security deposit. So in some cases it is 14 days and then we find out after we reconcile the security deposit that the guy hasn’t paid their last utility bill or their last two utility bills. That’s their responsibility in most cases to pay and the utility company should go after them. But if the utility company says, well, I'm going to turn off all the utilities on all your houses if you don’t pay it, we end up paying in it. And so, what we're working through and we then experiments in two markets – two different systems of solving at, and basically we have to get control of the utility bills. So that we know who is not paying, and we address it earlier, and so that’s where we're working on. In order to do that, we have to change the language in the lease, so it’s going to take some time to fully roll that out a year, fully roll that out, so that – so that’s what we're working on in terms of utilities. In terms of landscaping and we just – I expected it about 600 move outs a month. I thought I staffed good enough to handle…

It was 58, and I kind of misspoke last year, we were 58 to signed lease, and then there is a 10–day period between signed on average, the 10-day period between a singed lease and somebody moving in and paying rent. And so it’s really 68 days, it’s down to 55, so we've made 13-day improvement over the quarter and asked that’s from money producing to money producing so… Haendel St. Juste – Morgan Stanley: Got it. One last one, just wanted some additional color on the transaction mark, you put up $500 million target out there for 4Q acquisitions, just curious on what you are seeing out there in terms of opportunity that meets your underwriting guidelines, the competitive set, the growth net yields any changes there, just curious on the acquisition opportunities?

Acquisition opportunities are good. We see more modest price increases throughout the country and the rent growth is more than made up for that. So we think for the foreseeable future, we have a good path towards for our acquisition team. Haendel St. Juste – Morgan Stanley: The gross yields still in the, call it 10, 12 net in the 6-ish range?

I never even look at gross yields and – because I – to me, it’s somewhat not relevant. I work, because if you have a property taxes of 2.4% way different requirement, in some places it has a 1% property tax rate. So I'm probably – I don’t really think like that, I think of the net yields and I think that we're going to be in a low 6-ish on average. Haendel St. Juste – Morgan Stanley: Okay. Thank you.

A Low 6% return yield.

Thank you. Our next question is coming from the line of Steve Stelmach with FBR. Please proceed with your question. Steve Stelmach – FBR Capital Markets: Hi. Good morning, everyone. Just to get back on the core NOI margin discussion, 57% going to your guidance of 61% to 62%, to ask the question maybe a little different way, what needs to happen to get there, is it – do you need to actually execute on reconciling those operation – operating inefficiencies, or is it simply a matter of just getting beyond sort of the seasonal weaker period, maybe sort of size the sort of low-hanging fruit on getting that NOI margin back up?

Yes, I think that we will get it back up relatively quickly, and we'll have – expect to have some other surprises that come ahead at some point. But we're getting – we're three years into this now, and hopefully most of the surprises are behind us. We're – I would expect that the seasonal stuff is going to go away. We may have higher than 61% to 62% in the fourth quarter, because our move outs in the fourth quarter are traditionally our lighted, and then it may go back down. And you say in a weaker period, it’s not really our weaker periods, but second and third quarter are our strongest leasing periods there. They maybe the period where most of the move outs occur, so it looks weaker on an expense level, but they're definitely our strongest leasing periods, and people tend to move and we tend to get a lot of business during that time. In the fourth quarter, we'll have few – far fewer move outs during the Thanksgiving through New Year's timeframe, so we'll have a lot less expenses, but leasing will be weaker.

Our margins are really impacted by the seasonality of expenses, but we are on a very consistent basis seeing strong leasing. We maintained a 95% stabilized occupancy period after period after period and maintain strong renewals and retention of tenants. But the expenses, season by season are going to be different in character and different in dollar amounts. But we're kind of looking at this as an average what's the margin for the year, and that’s what we provided guidance, but there will be variability quarter-by-quarter. Steve Stelmach – FBR Capital Markets: So should we look towards that lease expiration disclosures you provided in a settlement sort of gauge maybe when the NOI margin is going to suffer a little bit more and what's going to benefit a little more just from a lease expiration perspective, is that kind of decent way to think about the seasonality?

Yes, we're kind of thinking about how we should present it. I mean, really our turn cost occur ratably over time, it’s just – they're not paid for or expensed that way. So maybe if we can – we're thinking about trying to smooth them out in terms of our core FFO by accruing form on a ratable basis based on what we expect to happen. But we haven’t finalized that, but we're just kind of noodling around with it to make it easier to understand. Steve Stelmach – FBR Capital Markets: Okay. And then on the renewal side, 68.4% for the quarter in merely what's sort of a transitional period for a lot of people's lifestyles, it was 73% in the summer quarter last year, anything going on there that of note as to why, sort of weaker year-over-year, and maybe put that in the context of your discussion about higher rent bumps?

Yes, I think that, I mean, the base reason is the seasonality. People are going to say and the summer is going to be there, their cut off from moving, it affects us positively on the leasing side, negatively on the move–out side. And I mean, I don’t know how – else to say, I would expect our retention in the fourth quarter to be substantially higher. Okay. All right, guys. Thanks a lot.

Thank you. The next question is coming from the line of Buck Horne with Raymond James. Please proceed with your question. Buck Horne – Raymond James: Good morning. I want to go back to the change sort of structural margin guidance longer-term for the company. I was wondering, if you could be a little more specific of what particular line items or assumptions you think are needing to be changed to lower that long term margin guidance?

Yes, our estimation at one point was that $300 per-year per-house was anticipated repairs and maintenance expense. We’ve had enough history now where we think it’s higher than that that it’s going to be closer to $600 per house and that’s really…

The key driver.

That’s the driver. Buck Horne – Raymond James: And mainly R&M, but was anything with – I mean, is that air-conditioning expense or was that the landscaping and lawn care that you mentioned? Is there some – is there one particular driver that’s more important?

Not really, I mean, we probably have a little more and I would say that some of it is self-insurance cost. You have the big repairs and maintenance that we have are usually caused by water damage that most home owners would send to their insurance but we’ve had a $125,000 deductibles that runs through our repairs and maintenance. It’s – those kinds of things really drive up the cost per house, but we’re having and it may be that it is first year or two of operation where you have – we have a lot of dishwashers and things that go out and just got to replace them. Buck Horne – Raymond James: Okay. And I was also curious just following up on the earlier question just trying to understand how you plan to strike the balance between pricing and occupancy. And maybe, just how do you think about managing the portfolio in terms of a stabilized occupancy rate? What do you think the long-term occupancy rate ought to be targeted at? And basically, another thought is, are you seeing any competitor actions right now? In terms of the industry at large, are you seeing competitors also raising prices or are you seeing any signs of incentives or concessions this time of year?

We’re seeing all the above, some are more aggressive in raising prices. Some of especially the private guys are especially this time of year trying to get heads in beds going into the winter, especially in the colder markets. So we see some pretty heavy, not really rate reducing but pretty heavy concessions by some of our competitors in certain markets, but not all of the competitors and not in all markets. Buck Horne – Raymond James: Would you characterize them as large competitors or kind of the small-end mom and pop variety?

At least the one I’m thinking of is pushing the concessions pretty heavily. It owns about 5,000 homes, so… Buck Horne – Raymond James: Okay. Great. Thank you.

Thank you. The next question is coming from the line of Anthony Paolone with JPMorgan. Please proceed with your question. Anthony Paolone – JPMorgan: Thanks. Good morning. Jack, if I recall correctly, I thought like dishwashers, refrigerators for the whole variety of the things that you guys have in homes is been like under warranty and you guys had cut some different deals on those warranties. Just wondering how that ties to the R&M numbers you guys talked about.

How… Anthony Paolone – JPMorgan: So like the $300 going to $600, is that net of what warranties and such cover. Like I’m just wondering…

Yes, that’s net. And that’s net of charge-backs and charge-backs related to general repairs and maintenance. And again, one of the things that we find is in the first 30 days to 60 days we have a – our most significant number of calls on homes that has been renovated, because a lot of them haven’t been lived in for a while. And so that number – it may be overstated, I don’t think it’s understated but we’re working to reduce it and get it where we thought it was going to be at $300, but at this point, after three years of operating this business and looking at what our current costs are, we think it is closer to $600 than the $300. Anthony Paolone – JPMorgan: Okay. I guess, what I’m trying to figure out is, I’m presuming that a variety of these warranties expire before the end of the useful life on a lot of these things and so like if the warranties were to burn off would there be like another step up in what you guys are on the look for R&M?

I don’t think, the appliances aren’t a significant number is repairs and maintenance. There is a little bit – most of the cost in repairs and maintenance you’re going to see in your plumbing and your air-conditioning. As we had mentioned, there’s so many inefficiencies that were in there with respect to utilities and landscaping. But I don’t think the appliances and the warranty is the significant component of what we’re talking about here. Anthony Paolone – JPMorgan: Okay. And then I think it’s, a question about the bad debt. I guess, just in catch like why is that running little closer? Seems like your average is a little closer to two points and you are talking about it coming down to one. What’s the driver to that?

The driver was the – if you look at our rents for the quarter and I don’t have it in front of me but it’s somewhere around – in case of rents we’re somewhere around $104 million to $105 million. We had approximately $58 million from centrally underwritten tenants which was $300,000 of bad debt, little more than $300,000 and then the remaining $1.7 million was on the $46 million of underwritten, either by our field people before we centralized it or by the third-party guys that we engage. So we feel comfortable that, that number is going to scale down as more and more of our tenants are centrally underwritten and every quarter that number goes up, so…

Yes.

Our experience this quarter, as well as, today has been that the – and for this quarter the numbers are about three times to four times higher in bad debt as a percent of revenue for those who have underwritten pre-January 1 compared to those underwritten after January 1. And that’s essentially the date that we fully internalized our operations.

And centralized. Anthony Paolone – JPMorgan: Okay. That’s all I have. Thanks.

Thank you. The next question is coming from the line of Dave Bragg with Green Street Advisors. Please proceed with your question. Dave Bragg – Green Street Advisors: Thank you. Good morning. Just revisiting the topic of turnover, we understand that seasonality plays a big role in the third quarter. But on a year-over-year basis, turnover increased 500 basis points. Can you talk about that? Would it have been less if you pushed renewals less than you did?

It might have been less, but I don’t think there would be – it would have been significantly less. I think what you have in – is you have people who expired in April, they go month-to-month until June or July so their kids finish the school year and then you just have a higher number of move-outs. We’ve seen the number decline in September and October, so we think that it had more to do with just when people move than anything else. Dave Bragg – Green Street Advisors: Okay. And thanks for the additional disclosure on lease expirations on page 16 of the supplemental. You do say that you have a thousand units on month-to-month leases. What level of premium do you garner for that optionality?

In general about 10%. Dave Bragg – Green Street Advisors: Okay. Great. Then as it relates to the markets it’s noticeable that the occupancy on both the 30-day and 90-day basis is a bit weaker in the Midwest markets of Indianapolis, Chicago and Cincinnati. Is there something fundamentally different about operating in those markets as compared to Sunbelt?

Well, no, I don’t think so. I think that we have some markets that – and it’s kind of hard to identify. I mean, we have – had a high level of inventory in Indianapolis and in some of the Midwestern markets. But then you look at Columbus and it’s doing great. So there’s probably – Chicago is probably more operational inefficiencies, just because of how spread out it is but the rest of the markets are just we had more move-outs in Indianapolis. I can’t figure out why at this point but it just happened. And the Midwest tends to be from what I can see and again we’ve been doing this about three years, to be more traditional in their timeframe, so you’re going to see a higher percentage in the Midwest move out in the summer and a lower percentage move out between Thanksgiving and Christmas. I don’t know if that’s their general traditional values or what it is.

Or weather.

Or weather. So it’s just kind of what we see. Dave Bragg – Green Street Advisors: Okay. Thank you. And the last question is on consolidation opportunities. What’s the pipeline for potential Beazer deals over the next six months or so?

We’re constantly talking to other operators. It’s still – it’s just rare that you get to a price and a section of homes or that fit our criteria and we’re pretty selective in what we bought. Others may not have been or maybe they were selective and just bought a different thing than we were buying, so and we’re seeing our turn cost to be a little higher in lower rent type of stuff. So we’re not really at this point anxious to take on a lot more of that.

We continue to be in discussions with a number of parties, and number of those parties have reinitiated discussions that we have started long time ago and broke off. They’ve reinitiated those, but to sit here and give you a forecast is very difficult to – there is a bit of spread difference. And each one is a negotiated transaction. When you get to the finish line, you get to the finish line and you close. But we continue to be in discussions but it’s very difficult to give any accurate forecast of what were you’re going to be able to accomplish there. Dave Bragg – Green Street Advisors: Understandable and you’ve spoken about the bid/ask spread in the past and it sounds like that might be narrowing.

With some, yes, and some, no. Dave Bragg – Green Street Advisors: Okay. Thank you.

Thank you. Our next question is coming from the line of Dennis McGill with Zelman & Associates. Please proceed with your question. Dennis McGill – Zelman & Associates: Hi, good morning and thank you. Just as it relates to the CapEx assumptions below the line, can you just review how you thought about that in establishing that reserve and in the discussion of the R&M expenses going higher this quarter? Whether that’s impacted your thought process there at all?

I mean, today and then the next foreseeable future for the next few years, there will be some minor CapEx in there. We fully renovated all of these properties over the last three years. The expectation is that there won’t be any significant items probably for the next five or six years in there. We will have a couple of hundred dollars probably per property, per year on average but nothing of significant this time. Dennis McGill – Zelman & Associates: And how would you think about that on a more normalized basis as the property sees in a bit?

Well, I mean, over – there’s a lot of variables in there and the majority of those items are that need to be replaced will be more than 10 years out, whether it’d be roofs or air-conditioning systems. Those are the primary two items that require capital expenditure dollars. And we will look at how we are going to deal with that as we get closer, there could be opportunities to rotate some inventory. But at this point over the next five or six years, I don’t see that happening. There maybe one or two here and there that we need to replace, but it’s not going to be up a large-scale item. Dennis McGill – Zelman & Associates: Okay. And then – so in the short turn the HVAC items that you’ve talked about are more just service request as opposed to actually replacing the units?

There is some replacement going on and there is a – but the primary amount is service. Dennis McGill – Zelman & Associates: Okay. All right. Thank you, guys.

Thank you. (Operator Instructions) Our next question is coming from the line of Jade Rahmani with KBW. Please proceed with your question. Jade Rahmani – Keefe, Bruyette & Woods, Inc.: Hi, thanks for taking the follow up. Just wanted to ask on property management if you could give where those costs are running as a percent of revenue in the quarter?

For the quarter, we are – the property management costs are running between 9% – what is in the leased properties is between 9% and 10% of revenue. Again, as we continue to acquire scale, those costs are coming down. Jade Rahmani – Keefe, Bruyette & Woods, Inc.: Okay. And did you give the bad debt expense as a percentage of revenue as well?

I believe it’s about 1.7%. Jade Rahmani – Keefe, Bruyette & Woods, Inc.: Okay. Thanks a lot.

Thank you. Our next question is coming from the line of Haendel St. Juste with Morgan Stanley. Please proceed with your question. Haendel St. Juste – Morgan Stanley: Hey, just a couple of quick follow-ups here. Dave, I wanted to go back one last time to the margin issue, just wondered if there is anything at all about the experience that suggests perhaps that you guys are getting close to a maximum natural size or efficiency of the company, or perhaps that you might have acquired too much typically the last couple of quarters. I'm curious as to what message, perhaps, you would like to convey to your core investor base? And those who remain, I guess, a bit skeptical on the long-term inefficiencies or efficiencies of the single-family rental business?

I don’t think you should read into anything that’s happened this quarter that there is a capping off of scale. On the inefficiency side, I would tell you that, we probably were a little bit short in our staffing, in our preparation for the number of turns that we did have in a couple of our markets. So – but as we continue to add additional properties into our system, what we are going to see is better efficiencies in our property management area, for the most part we have a very scalable system throughout the country. And I don’t think, we have – I don’t think there is anything in this quarter that should indicate that the management platform can't handle additional properties. We will continue to acquire properties so long, as we believe, the returns of those properties is accretive and attractive in relationship to the capital that we are utilizing to acquire those properties.

And, Haendel, I would kind of look at it this way is, when we first started acquiring back in mid-2011, we weren’t that good at it and it took a six to nine months to get really good at it. And then we did renovations and we struggled with that for a while and we – then we got really good at that. And then leasing, we struggled with that for a while and then we got good at that. And I would say, this is just the next step evolution of things that we need to get really good at, and we're going to get there. Haendel St. Juste – Morgan Stanley: Okay. And then one last one, you guys are working now in your third securitization, Blackstone, I think is working on its fourth. We are hearing talk a multi-bar securitizations out there working their way through the pipeline. Just curious on how you would access the demands in paper, seeing any signs of stress in the system, demand winning, anything on that front would be appreciated?

Well, the demand does vary as you work throughout the year, and also as to what type of securitization that you are processing. We have seen in the latter part of this year, there has been a lot of paper that has been in the variable rate market, the ABS market, putting a little bit of pressure on those rates. We aren’t too market yet on our third securitization. If you look at it today, the fixed rate market is a little bit more attractive, less paper, less supply coming out in fixed rate components in the 10-year. So I'm encouraged that that would be an attractive place to be – I'm encouraged that that would be an attractive place to be issuing paper. But it does move up and down. We have seen the base interest rates move up and down. There is a lot going on in this world that influences those items. And so part of it is timing and part of it is structure. Haendel St. Juste – Morgan Stanley: Thank you.

Thank you. We have reached the end of our question-and-answer session. I would now like to turn the floor back over to Mr. Singelyn for any additional concluding comments.

We would like to thank all of you for getting up early this morning and joining us today. We'll see some of you at NAREIT, and we look forward to speaking with you next quarter on our year end conference call. Thank you very much.

Thank you. This does conclude today's conference call. We thank you for your participation, and you may now disconnect your lines.