Good afternoon, ladies and gentlemen, and welcome to the Americold Realty Trust First Quarter 2023 Earnings Conference Call. At this time, all lines are in a listen-only mode. Following the presentation, we will conduct a question-and-answer session. [Operator Instructions] This call is being recorded on Thursday, May 4, 2023. I would now like to turn the conference over to Scott Henderson, Senior Vice President, Capital Markets and Investor Relations. Please go ahead.

Good afternoon. Thank you for joining us today for Americold Realty Trust first quarter 2023 earnings conference call. In addition to the press release distributed this afternoon, we have filed a supplemental package with additional detail on our results, which is available in the Investor Relations section on our website at www.americold.com. This afternoon's conference call is hosted by Americold's Chief Executive Officer, George Chappelle; Chief Commercial Officer, Rob Chambers; and Chief Financial Officer, Marc Smernoff. Management will make some prepared comments, after which we will open up the call to your questions. On today's call, management's prepared remarks may contain forward-looking statements. Forward-looking statements address matters that are subject to risks and uncertainties that may cause actual results to differ from those discussed today. A number of factors could cause actual results to differ materially from those anticipated. Forward-looking statements are based on current expectations, assumptions, and beliefs, as well as information available to us at this time that speak only as of the date they are made, and management undertakes no obligation to update publicly any of them in-light of new information or future events. During this call, we will discuss certain non-GAAP financial measures, including core EBITDA and AFFO. Full definitions of these non-GAAP financial measures and reconciliations to the comparable GAAP financial measures are contained in the supplemental information package available on the company's website. Now I will turn the call over to George.

Thank you, Scott, and thank you all for joining our first quarter 2023 earnings conference call. This afternoon, I will provide the latest information around our recent cybersecurity event. I will then comment on some key operational metrics and financial results for our first quarter and our outlook for the remainder of the year. Rob will provide an update on our recent customer initiatives and Marc will provide a detailed walkthrough of our guidance for the remainder of the year. As we shared earlier this week, our IT systems were recently impacted by a cybersecurity event. Our cybersecurity protocols limited the impact of the intrusion to approximately 30% of our facilities. As of today, the impact has been reduced to approximately 15% and we expect to see continued progress over the short-term. It is important to note that none of our safety procedures or structural capabilities within the impacted facilities, such as power and utilities, refrigeration systems and blast freeze processes were compromised. Although, inventory was being preserved within these impacted facilities, throughput was temporary halted and is currently scaling back up quickly. During this event, we will continue to work incredibly hard to accomplish two goals. First, communicate proactively and transparently with our customers on both food manufacturing and retail sides of the business. And second, implement manual processes and procedures to reduce overall disruption to the business as much as possible. Mandiant, our strategic partner since late 2020, and a recognized global cybersecurity expert in conjunction with our in-house cybersecurity team is leading the restoration of our systems so that when they come back online, our systems have a clean bill of health. We have also engaged the appropriate law enforcement authorities in the investigation. Since late 2020, we have invested in incremental $20 million in cybersecurity, which…

Thank you, George. As George mentioned, our company achieved some very significant milestones during the first quarter, including record setting first quarter economic occupancy levels at 84.6% for the same-store pool and record setting fixed commitment percentage levels for our total warehouse segment. At quarter-end within our global warehouse segment, rent and storage revenue from fixed commitment contracts increased on an absolute dollar basis to $480 million, compared to $367 million at the end of the first quarter of 2022. On a combined pro forma basis, we derived 46.1% of rent and storage revenue from fixed commitment storage contracts, which is an approximately 630 basis point improvement over the first quarter of 2022. We're very pleased with this progress. Given these operating metrics, we are continuing to accelerate the underwriting process and evaluating development opportunities, which includes a mix of expansion and greenfield projects, customer dedicated and major market distribution centers and conventional and automation facilities. Combined, this macro backdrop along with our strength and development platform positions us well to capitalize on these potential opportunities. Within our Global Warehouse segment, we had no material changes to the composition of our top 25 customers who account for approximately 48% of our global warehouse revenue on a pro forma basis. Additionally, our churn rate remained low at approximately 3.1% of total warehouse revenues consistent with historical churn rates. Going forward, we are confident that we will recover stronger from this recent cybersecurity event. As part of our key priorities around providing best-in-class customer service, we plan on spending significant time with many constituents in the food and supply chain, current and potential customers, suppliers, partners to name a few, sharing our experience and educating them on our lessons learned. We’ll seek to work with our industry constituents on how to broadly…

Thank you, Rob. Today I will discuss our capital position and liquidity and then I’ll turn to full year guidance. At quarter end total debt outstanding was $3.5 billion. We had total liquidity of $566 million consisting of cash on hand and revolver availability. Our net debt to pro forma core EBITDA was approximately 6.5x. At this point, we have invested approximately $304 million on development projects in process and have approximately $67 million remaining to invest throughout the year on these projects as detailed on Page 33 of the IR supplemental. As we discussed in our last call, we expect to organically delever as our same-store portfolio continues to improve and our recently completed and in process developments ramp to stabilization. Now let me discuss our outlook for the remainder of 2023. As George mentioned, we are increasing our guidance for the full year 2023 AFFO per share to be in the range of $1.16 to $1.26, which incorporates our strong first quarter results and reflects the impact of the cybersecurity event as we understand it today. Please see Page 36 of the IR supplemental for key components underpinning this guidance. At this point, I will comment on the primary building blocks to get to AFFO per share and provide a bridge for each as it relates to the full year. We are now expecting constant currency revenue growth in the same-store pool for the full year to be in the range of 4.5% to 8.5%. For the first quarter, it was 12.3%. This implies growth for the remainder of the year to be in the range of 1.9% to 7.3%. Let me provide more detail around the key drivers of this growth. For occupancy and throughput volumes. For the full year, we expect economic occupancy to increase by…

Thanks, Marc. As the operational and financial results of the first quarter highlight, our core business continues to grow and performs above expectations. While we recognize the cybersecurity event as a disruption, we will not allow it to impact the progress we have made for the long-term trajectory of our business. We would like to thank our associates for their hard work and dedication during this time. Thank you again for joining us today, and we will now open the call for your questions. Operator?

Thank you. [Operator Instructions] Your first question is from Samir Khanal from Evercore ISI. Please ask her question.

Hello, everybody. First of all, Scott, congratulations on the promotion, certainly well-deserved. George, on occupancy, I just wanted to ask you, maybe you can provide a bit more color. Sounds like occupancy will continue to increase throughout the year. I mean, you hit sort of record setting levels in 1Q. I know it’s a little bit early, but how do you think about occupancy sort of to the end of this year and even 2024 at this point based on kind of what you’re saying. I guess, what’s the new normal or the new peak you can hit in 2024?

Well, I think the first quarter occupancy Samir is primarily driven by two things. One is food manufacturers ramping up production as they’re able to staff appropriately, as were we in the first quarter. And also the record setting fixed commit sales. I mean, commercial group really commercialized a ton of fixed commit. To give you an idea, it’s over $100 million above year-over-year in revenue now in fixed commit. So those two things are really driving first quarter occupancy. We did raise guidance for the full year, so we expect most of that to flow through the entire year. It’s a little early to comment on 2024. But I think what this reflects as manufacturers being able to produce, getting their inventory correct is probably the next remainder of the year. I wouldn’t say that the inventory is optimal at the item level, but it certainly is optimal at the total level from a volume standpoint. So hopefully that gives you a little more color on where we are.

But just in terms of modeling perspective, I mean, is it fair to assume that even in 2024 it would be higher than 2023 at this point, or would it kind of hit a level in 2023 in the sort of flat lines you think?

It all depends where our customers are in the cycle of building back their customer service levels and their innovation plans and all the things that still have to normalize to get back to a normal supply chain. I mean, we know we can service higher inventory. We know we can get into the low 90% in our buildings and service it very, very well. So it’s not that we’ve maxed out ourselves at the 85% level, let’s say. But I don’t know where it will go. I suspect we’re close to a high watermark, but I’d also know there’s a lot more refining that has to go on in the inventory content itself to get it optimal to service customers at 99.5% or higher percentage points, which is where everybody’s trying to get to.

Got it. And just…

[Operator Instructions] The next one is from Mike Mueller from JPMorgan. Please ask your question.

Yes. Hi. Just curious, in terms of occupancy so far the second quarter, are you starting to see the normalization that you were talking about that you laid out when you were talking about guidance for the back half of the year or is that still basically an assumption at this point?

No. I think if you look at our year in occupancy Q1 and Q2 are by far our lowest occupancy points of the year historically. Obviously Q1 this year at a record high is a little counter seasonal driven by probably the fixed commits I mentioned over $100 million year-over-year and obviously manufacturers ramping up because they have labor. It wouldn’t surprise me if sequentially occupancy declined a bit as manufacturers refined the inventory content as I just mentioned. But for the full year, we are saying it – guiding it up because we expect Q3 and Q4 to be very strong. So it could, again, sequentially see a small dip as manufacturer’s right size, but our guide reflects an overall increase in occupancy through Q3 and Q4.

Thank you. The next question is from Vince Tibone from Green Street. Please ask your question.

Hi. Good afternoon. It sounded like in Marc’s comments around some of the guidance changes at the cybersecurity event impacted multiple line items. Just kind of to help sum it up, are you able to kind of – provide an est amount, how much the event is kind of dragging on guidance if you will, in aggregate?

Yes. If you think through it, we widened out our guide around throughput volumes being down roughly increase that at the upper end or the wider end by 100 basis points. So you can flow that through, it’s roughly about 380,000 pallets. And you can look at our current occupancy there. We also commented around impact on margin, in particular, obviously I commented that we’re going to be less efficient in particular in this quarter as we were working through the cybersecurity event. So we’ll have higher labor costs, higher operational efficiencies. And I think the last area too is we think about cybersecurity and cybersecurity defense spend. You can see that we did include incremental costs in our SG&A, our core SG&A guide. So if you think through it those tends to be the primary numbers that will impact our AFFO guide for the years as it relates to...

I guess in total, what is that amount to, is this a $5 million drag? Is this – million, like, if you just help kind of simplify some of the math and get us all on the same page? Is there a dollar amount you’d be willing to share on the impact?

Look, I think we factored in, given that this is an ongoing event right now. Based on the best of our knowledge, we factored it into those guide parameters. So I think at that we’ll leave it at that, but it’s impacting those line items.

Go ahead, sir.

No, it’s impacting those three main line items that I described.

Thank you. Your next question is from Josh Dennerlein from Bank of America. Please ask your question.

Hello, this is Ben Bian for Josh. Congrats on the economic occupancy. I was just kind of curious does that occupancy build imply that you guys are capturing market share?

I think, as we’ve said pretty consistently from a customer service standpoint, we’re doing – we were doing really, really well through the first quarter and that it’s clear that part of that was manufacturing increases. Part of it, obviously the big fixed commit increase, but for sure part of that was market share gains as well. There’s no question about that. We don’t have really good tools to break it down, but we know to be at this level of occupancy, we had to have had market share gains to get there. So it’s a combination of all three. I’d say by far though, the most impactful component is food manufacturers hiring people as we were successfully able to hire people in our operation and ramping up production, that would be the biggest piece combined with the fixed commit, which is essentially reserving space for that production.

Great. Really appreciate the color.

Thank you. And the next one is from Michael Carroll from RBC Capital Markets. Please ask your question.

Yes, thanks. I know we’ve been talking a lot about this economic occupancy, but I have another question. I know, George, you said it was due to higher fixed commitments and just overall better production. But is there any more details? It just seems like it’s a fairly sizable uptick versus the historical trend. I mean, is there any specific large customer agreement that you won? Did you just have several other customers that came on board that just kind of started? I mean, has this just been building over the past few quarters or is this kind of just a surprise to you?

Well, I’ll turn it over to Rob in a second, because he’ll probably have more color than I can add. But we always said, look we have a blue chip manufacturing customer base. And given that it is a blue chip base when they can turn on production, it comes in – comes fast and it comes in big numbers. And we’ve said when that day comes, we’re going to see occupancy increase pretty quickly. And that’s exactly what happened. This is not a time of year we typically hit a seasonal high. Obviously, it’s one of our lowest parts of the season. To have a record breaking occupancy quarter in Q1 is very unusual. But it reflects the fact that labor is becoming available, retention is getting better. It is in our business as well, by the way. And at that point, manufacturers when they produce, given the blue chip manufacturing base we have, it happens quickly and in big numbers. Rob, I don’t know if you want to comment on the customer content.

I just think you have a lot of the food manufacturers all getting back to normalized production at the same time. And as everybody was able to make progress kind of consistently, and again, remember our book of business is more heavily skewed towards those big food manufacturers who are able to make that progress faster. With everybody kind of coming back at the same time, not only are we seeing the increase in physical occupancy, but you’re also having our customer base recognize the need to reserve that capacity. And so our economic occupancy benefited significantly. It’s a combination of all those things. No specific large new business win or anything that I would highlight.

I guess then, Rob, is there any specific assets like the production advantaged assets? Did they gain more occupancy? Was it the distribution is like throughout the chain? Has that changed at all?

It has. I mean, what we’re fortunate is, is that we’re seeing it across all of the nodes in the supply chain. Our production advantaged facilities are up. We’re also seeing in our four distribution centers and even our retail fulfillment centers have high occupancy at the moment.

Which I think reflects just a general labor availability situation getting better in the overall supply chain, putting more product in the system.

Thank you. Your next question is from Anthony Powell from Barclays. Please ask your question.

Hi, good afternoon. Just a question on the cybersecurity incident. Usually I think of these as theft of customer data, but this seems like more something different. Could you maybe describe exactly what’s going on here? Is this operational sabotage, just more detail would be super helpful.

Yes, unfortunately at this time, Anthony, we cannot provide more detail when we say this is active, we mean it really is active. The investigation is not complete as to exactly some of the questions you just asked. So I’m sure at some point in the future we can comment more directly, but unfortunately we can’t at this point.

Right. Got it. So for my follow-up, just a question on throughput, and I know it’s down a bit due to the economic situation. At what point does the throughput decline become headwind for occupancy? I guess, looking forward when you need to see throughput improved for you to be comfortable that you can continue to drive higher occupancy.

I’m not sure, and I’ll ask Rob to comment in a second. But I don’t – I’m not sure throughput and occupancy correlate one for one, right, because throughput is a combination of inbounds and outbounds average together. So you can have inbounds increasing occupancy, outbounds being down – overall throughput being down, but occupancy going up, for instance. And you could have the reverse if outbounds exceed inbounds. So I don’t know that there’s a real correlation to overall throughput given it’s an average between inbounds and outbounds. But our business is better when throughput is up, right? I mean, our handling revenue goes up, our handling NOI goes up. So we want throughput in the system. But I consider it more for economic reasons than for servicing our customers those reasons that I look at throughput. I think it’s a tough correlation to occupancy.

It is. I mean, at the moment, obviously we’ve had economic occupancy benefited a little bit from the standpoint of inbounds exceeding what we’re seeing on an outbound level. In an ideal scenario, as George has described, we’re seeing product turn through the facilities quickly, so that we’re getting incremental storage revenue and we’re getting the throughput or the handling services revenue as well. At the moment we have our inbounds exceeding our outbounds, which is helping occupancy. So it would have to go the other way where it would be a drag on occupancy, but for now we’re seeing the opposite.

Thank you. Your next question is from Craig Mailman from Citi. Please ask your question.

Hey guys. Maybe a follow-up, right? We’ve been talking a lot about the bumps in occupancy helping same-store here. But as you think about the dynamics that are pushing it, production’s getting back up, the end user demand is slowing, right? So there conceivably could be a little bit of a limit here. But you’re getting the pop this year. As we think about next year, and I know you’re not giving 2024 guidance, but the comps are going to get really tough because you’re getting all this economic occupancy now from that production input plus just transitioning to fixed price contracts. I mean, could this be the kind of the peak in growth year just given those dynamics as we think about AFFO and same-store kind of in 2024?

I would say, no. And maybe coming at this a little differently, Craig, remember we had huge upside if we could get handling correct, right, in terms of efficiency and productivity. We've said that while we've been able to attract people to the business and we're doing much better at attracting people to the business, 75% of our work content was done by permanent employees. We've always said there's three months to get those people productive. We haven't achieved that yet. And we said there was significant upside to margins when we get to the levels of productivity that are no more than pre-COVID, they weren't aspirational. We just had to get back to pre-COVID. So even if occupancy comps become tough next year, as you just mentioned, which I think is likely, I mean, 84.5% in the first quarter record setting. Obviously there are limits, but the handling margins are still out there for us to get, we're still focused on getting them, and that was a substantial number as we pointed to last time we met. So that's really still the opportunity.

And we're really focused on optimizing mix, right, so that we can drive occupancy even higher. So, we'll use the backdrop to make sure that we're focused on optimizing mix in the facility that allows us to keep driving occupancy.

And then lastly said, I know your question is about same-store, but just remember next year as we move forward, we'll have the benefit of a number of development projects ramping to stabilization.

Okay. And then just the follow up to an earlier question on, putting a number or bridge around the cyber piece, I guess if I'm looking at the differential in core SG&A, that's $10 million. If I'm looking at some of the revenue on the transportation side, that's like $7 million. So if I'm around, call it $17 million to $20 million, that seems about $0.08 to $0.10. Is that kind of the right way to think about what this impact kind of is being layered in these different line items?

Look, I think those are some of the components, but they don't represent all the components from cyber. So as we said, in transportation, as I mentioned originally on when we gave guidance for this year, and in my prepared remarks, there is an overall slowdown in overall economic activity, which is impacting transportation. It is in all cyber. As we've been guiding for this year, throughput has been down, although we did call out that, part of the higher decrease in slowdown and throughput is related to the cyber event. So, as I said that the event is ongoing. It's still fresh. We're working through it, but as best we know it's those line items that I called out that have the impact of where we're seeing the cyber event.

Thank you. The next question is from [indiscernible] from Baird. Please ask your question.

Hey, good afternoon, guys. I guess, maybe touching a little bit on fixed commitment structures, is there an optimal level you can get to on a fixed commitment for just this rent and storage piece combined with the services? And have you had any negotiations on maybe layering in some fixed commitment component to the service part of the industry?

I mean, our next milestone I think for fixed commitments is to get over 50%, which we're really focused on. I think over a longer period, we can get that number into the 60s and that would be a great milestone for us to get to. I think it is important to still have a component of the business that's transactional. Because it gives you some flexibility to operate and so it will never be a hundred, but I think if we get over the 50 – over the 50% range and into the long-term, we crack the 60% range, we would be ecstatic. On the services side, there is from time to time, the volume commitments and those types of things. But really what we do is we have what we call profile protection. And on the variable side of the business, which is the assumptions around throughput and the percentages of the business, they're going to be full pallet in, full pallet out or potentially case pick. So that we can understand our work content and generally speaking, if there is significant variability from what we underwrote in the contract, there's an ability for repricing that side of the business, less around volume type commitments and true-ups, more around our ability to adjust the rates if the work content is different on the services side.

And then maybe last question for me, maybe for Scott, looking at like, financial conditions are kind of tightening here and there's a decent amount of spec construction in this space. Are you seeing any opportunities for some takeouts here? Just looking across the board?

I would say, right now when we're looking at deals from sellers or potential sellers, which we have – we continue to have discussions with different market participants, the bid ask spread is still remains somewhat wide, meaning folks are looking at multiples based on levels before interest rates rose, as well as still wanting to underwrite fully recovered EBITDA levels. In terms of spec construction, Rob, I think we've seen on the development side, a little bit of that, but we're not seeing a ton across the entire network. As a reminder, this asset class you not only have to build it, you have to operate it, and it's expensive to build, and you have to have a platform to operate it. So that really limits spec across the platform, or excuse me, across the different geographies. So we just haven't seen a ton of that at this time.

Thank you. The next question is from Bill Crow from Raymond James. Please ask your question.

Thank you. Good evening, guys. On the cyber incident, I've got a two-parter here. First of all, how similar is this incident to the prior incident that occurred? And second of all from a – maybe a different point of view, but how is the customer reaction to this? You've been pushing and pushing rents successfully. There were service issues last year as your labor force struggled and now a cyber event that disrupted their activities. I'm just curious whether there's any sort of potential threat to tenant retention or anything else that goes on with us.

Yes, Bill, I'll answer the first part of your question and then I'll hand it to Rob to talk about customer impact. But as Marc has said, this is still ongoing. So we don't have an investigation to compare per se to the last incident. But what we know is that every incident is almost unique. I mean, whether it's across an industry or across a group of industries or even one event to the next as you're describing. So I would expect that the similarities at every level are few because the environment is so fluid when it comes to this kind of thing as I'm learning. So when we have the investigation complete we can answer that question, but I would expect the answer to be very few similarities because we shut that door back in the first incident pretty hard and hardened our IT environment pretty significantly with a $20 million spend, as I said on my prepared remarks over just a few years. So that's all I can say, with respect to the first question. Second one, Rob, if you want to comment on.

Yes. When it comes to customer reaction, I think George hit it very well in his prepared remarks. I mean, the first thing that's important to our customers is that we're communicating proactively and transparently, which we have through this scenario. And the second thing is that we demonstrate a willingness very quickly to stand up manual processes to keep the business moving even if not as efficiently as possible while we fully recover. And we've done that as well. So, I think that certainly helps. We definitely recognize that there's going to be a need coming out of this to spend quite a bit of time with our customers, walking them through the investments that we have made and that we'll continue to make and talk more broadly about what we can do to minimize the impact of this and share lessons learned because these are the things that can also happen to our customers or any of our competitors. So we're going to need to spend that time having those conversations, but I think if we continue to do that we're not concerned about a significant risk associated with churn as a result.

Great. Thank you.

Thank you. The next one is from Ki Bin Kim from Truist. Please ask your question.

Good evening, everyone. So first question, anything unusual about the first quarter that might have contributed to the higher occupancy? Did any development projects start to like stabilize in the first quarter, maybe earlier than I expected? Just trying to understand any kind of unusual items?

I mean, the occupancy recorded was same-store. So, I mean, any of the developments are really kind of outside of that number, albeit as we mentioned, we did have one development project that we're excited to complete. And we are at a point on that development project in Lancaster where we are recognizing rent and storage out of that project. But no – like we said, it really is the culmination of manufacturers ramping back up, a lot of them at the same time, the fact that our book of business is skewed towards those blue collar manufacturers and the fact that we had the fixed commitment contracts come through.

Yes, I asked that because same-store facility account changes on quarter-to-quarter here and there. So second question, if I understand it correctly, the fixed commitments, it generally doesn't increase a total basket of revenue, right. It maybe smooths it out that, at least that was my understanding from previously. So is that what's contributing to the remainder of the guidance whether that be occupancy or same-store revenue that's decelerating a little bit from here on out, or how much conservativeness is driving that deceleration?

Yes, as Rob mentioned around fixed commitments, they clearly stabilize out the revenue throughout the quarter. So you have a little less seasonal impact of the revenue. And then obviously as they are underlying, physical build of the actual physical inventory that may just reduce the gap between physical holdings and economic holdings. But from an overall, how we report revenue, more fixed commitments tend to actually smooth out revenue through the year. I think when we've looked at it over time, we have found that overall, fixed commitments drive incremental revenue, but they also tend to drive significant savings to our customers in terms of knowing that they have the space that they need when they need it, which allows them and particularly you've heard us talk about this in the past to procure transportation as an example, more efficiently and drive savings, because warehousing is a much smaller piece of the overall logistics spend when you factor in transportation.

Thank you. The next one is from Nate Crossett from BNP Paribas. Please ask your question.

Hey, good evening. Maybe you could just give an update on Europe, the portfolio over there. Is there anything unique you're seeing in terms of trends? And then my second question is just on the balance sheet and funding development this year, how should we think about sources and uses and where could you raise debt money today? Thank you.

Hey Nate, I'll take the first one and I'll hand it to Marc for the second half of your question. But Europe is going reasonably well. I mean, occupancy there remains high. Customer activity remains high. The outlook for the remainder of the year looks very good. We expect a good year out of Europe. And as of the moment, things are on plan and going really well, whether it's pricing to recover inflation, whether it's continued surcharges to recover increased power or whether it's a couple of new developments that have recently come online in Dublin and Barcelona. So we're very pleased with the progress in Europe. We've always said, there's more commercialization work to do there, and, and there is part of the fixed commit does reflect us moving fixed commits for the first time into Europe, but what I should say, maybe the first time it’s scale into Europe, lots more opportunity to do that there. And Europe is going very well at the moment.

So yes, as it relates to the balance sheet and funding, we're very focused on making sure we have the maximum opportunities and flexibility to pursue all forms of capital to support customer driven growth, which is something that we've commented in the past, especially for developments that these opportunities come up. They're very long dated commitments for significant capital spend. So we're focused on making sure we have all the tools in the toolkit to do that. As you think about the balance sheet today, and you began to see from your end through first quarter, clearly we're focused on organically delevering as the earnings return back into the platform. You see that in the overall organic earnings growth as well as the fact that we just have a number of core deliveries of development projects this year. And as those development projects are delivered and ramp up, we believe that we can continue to organically delever the balance sheet down. And some of that was even seen beginning in this first quarter.

I think your last question really related to, where could we raise 10 year money today as a BBB credit? I think it'd probably be somewhere in the low 200s above treasuries.

Okay. Thank you.

Thank you. [Operator Instructions] There are no further questions at this time. Please continue.

Well, thank you all for joining the call and we look forward to speaking with you again soon. Thank you.

Thank you. Ladies and gentlemen, the conference has now ended. Thank you all for joining. You may all disconnect.