Good morning, and welcome to the Highwoods Properties Earnings Call. During the presentation, all participants will be in a listen-only mode. Afterwards, we will conduct a question-and-answer session. [Operator Instructions]. As a reminder, this conference is being recorded, Wednesday, February 5, 2020. I would now like to turn the conference over to Brendan Maiorana. Please go ahead, Mr. Maiorana.

Thank you, operator, and good morning. Joining me on the call this morning are Ted Klinck, our Chief Executive Officer; Brian Leary, our Chief Operating Officer; and Mark Mulhern, our Chief Financial Officer. As is our custom, today's prepared remarks have been posted on the Web. If any of you have not received yesterday's earnings release or supplemental, they're both available on the Investors section of our Web site at highwoods.com. On today's call, our review will include non-GAAP measures such as FFO, NOI and EBITDAre. Also, the release and supplemental include a reconciliation of these non-GAAP measures to the most directly comparable GAAP financial measures. Forward-looking statements made during today's call are subject to risks and uncertainties, which are discussed at length in our press releases as well as our SEC filings. As you know, actual events and results can differ materially from these forward-looking statements. The company does not undertake a duty to update any forward-looking statements. I'll now turn the call to Ted.

Thanks, Brendan, and good morning. 2019 was an eventful and productive year for Highwoods. We ended the year strong, with impressive fourth quarter leasing results and FFO at the high end of our outlook. Our team is laser-focused on executing our market rotation plan, increasing occupancy and rents in the portfolio, and finding additional opportunities to further strengthen cash flow and drive our long-term growth. Our markets continue to outperform national averages across a wide array of economic and real estate metrics. Population and office-using job growth is driving demand for office space in our BBDs. To that end, in ULI’s 2020 Emerging Trends in Real Estate, three of our cities were listed in the top four nationally for Markets to Watch, and six of our eight were included in the top 11. There is great momentum across our portfolio footprint, as we continue to see numerous corporate relocations into our markets. 2019 included a lot of positive activity, namely, entering Charlotte with the $436 million acquisition of Bank of America Tower, making significant progress toward our planned exits of Greensboro and Memphis, backfilling a significant portion of 11000 Weston and 5332 Avion, announcing $150 million of development, and placing in-service $300 million of development that were a combined 99% leased. We accomplished this while transitioning the CEO and COO roles and posting strong leasing and portfolio fundamentals. We’re pleased with this momentum as we start 2020. Turning to our 2019 results, we delivered FFO of $3.33 per share. As you know, our results were impacted by the balance sheet write-offs associated with Laser Spine’s sudden closure in the first quarter and the one-time costs from our market rotation plan. Excluding these items, our FFO and same property NOI growth would have been in the upper half of the outlook…

Thanks, Ted, and good morning, everyone. We finished the year strong and capped off a solid year of growth from our leasing teams in the fourth quarter. Second generation office leasing volume was over 1.2 million square feet, including 398,000 square feet of new leases, our highest quarterly new leasing volume since mid-2014, and we captured GAAP rent spreads of a positive 19.8% and cash rent spreads of a positive 6.1%. Our high quality, BBD-located portfolio has enabled our leasing team to drive rents higher; however, even more impressive is the consistent improvement in net effective rents. This quarter was especially noteworthy with net effective rents of $18.17 per square foot, 14% above our prior five-quarter average. These healthy lease economics are showing up in our financial metrics, where we expect strong 2020 same property NOI growth with even occupancy projected to be consistent year-over-year. In the fourth quarter, we posted same property NOI growth of 1.1%, or up 2.6% excluding 5332 Avion in Tampa. Our portfolio occupancy increased 80 basis points sequentially to 92.2%, finishing the year towards the upper end of our 91.7% to 92.3% range. The biggest gains in sequential occupancy were in Tampa and Raleigh. Included in year-end occupancy is 92,000 square feet with Fanatics at 5332 Avion in Tampa. Cheers to our Tampa team for getting some solid points on the board so far at 5332. We’re underway converting the three lower floors to traditional office at 5332 Avion where we believe it will be one of the top office buildings in the Westshore submarket. In Raleigh, there were several medium-sized users that drove the improvement in year-end occupancy, without getting the benefit of 98,000 square feet at 11000 Weston that was signed but where occupancy hadn’t yet commenced by year-end. Reducing our near-term rollover…

Thanks, Brian. As Ted outlined, 2019 was an active and productive year for our company. We delivered FFO of $3.33 per share at the high-end of our revised outlook. As you know, there were $0.17 of unusual items in 2019 that impacted FFO. Most notably, the non-operational balance sheet write-offs associated with Laser Spine’s sudden closure in the first quarter and the cost associated with the market rotation plan. Excluding these items, our FFO would have been right at the midpoint of our original outlook, and this includes 10 months of lost NOI from Laser Spine as well as the dilutive impact from the sale of MetroCenter in Q2, which together reduced 2019 FFO by $0.06 per share. In the fourth quarter, we delivered net income of $0.58 per share and FFO of $0.91 per share. As expected, we recorded $0.03 per share of NOI due to the November 14th acquisition of Bank of America Tower, which was offset by $0.02 a share of additional interest expense for the pre-funding and funding of the acquisition and $0.01 of additional accrued severance costs associated with the planned closures of our offices in Greensboro and Memphis. In last night’s release, we provided our initial 2020 FFO outlook of $3.60 to $3.72 per share. At the midpoint, FFO is up approximately 10% year-over-year. Excluding the one-time items that impacted 2019, our 2020 outlook still implies 4.6% year-over-year growth at the midpoint. As we mentioned in August when we announced our market rotation plan, we expected phase one to be initially FFO neutral and cash flow accretive. While there is still work to be done to complete phase one, we’re on track to meet our overall initial expectations, and we’re confident there is significant long-term growth potential for us at BofA Tower and in…

Thank you. [Operator Instructions]. Our first question is from the line of John Guinee with Stifel. Please go ahead.

Great. Nice call, guys. Thank you. One question. I kept hearing that the asset recycling was going to be FFO neutral but AFFO are cash flow accretive. So I’m a little surprised to see that you chose to raise your dividend by only 1%. Any thought process there? Can you expand on that a bit?

Yes, John, it’s Mark Mulhern. As you know, the CapEx was a little higher in the last couple of quarters. So we have high confidence that the cash flow profile of the company is going to continue to improve with development deliveries and with some of the leasing activities that we’ve done. We tried to keep it close to, in line with our taxable income. And so balancing all of those things, we felt like that was an appropriate move to make and we continue to evaluate as we go forward.

But I thought the whole deal was that CapEx was going to come down.

Yes, we believe it will. Obviously we’re just completing the sales of those assets. So the CapEx decline will happen as we go forward, no question.

Great. Okay. Thank you very much.

Sure.

Thank you. Our next question is from the line of Jamie Feldman with Bank of America. Please go ahead.

Thank you. So we’ve had a couple of management teams comment on how business feels today versus this time last year. I’m just curious to get your thoughts. You had a very good quarter. You had some nice leasing spreads. It seems like supply is picking up in your markets. Maybe just kind of big picture thoughts on that comparison.

Sure. Jamie, it’s Ted. I think our business fundamentals feel really good. We have – with our boots on the ground our local teams, we have fairly frequent calls to understand where activity is, how tour activity is, we monitor sublease space expansion. So I’d say compared to last year, it’s equally as good. We felt pretty good last year. So our demand really across all of our markets and submarkets continue to be good. Tour activity, we’re seeing a lot of inbound, new companies moving, our markets are benefiting from a lot of job growth. So compared to last year, I’d say it’s right on par.

And are there certain markets that feel different than this time last year?

Not materially where I think I’d call one out. I think demand just it’s really good across the board.

Okay. And then I know you didn’t include phase two asset sales in your guidance. But to the extent you get them done during the year, how do we think about the potential earnings impact or do you think you might match fund that with acquisitions? I know you’ve got acquisitions not in your guidance, but in your potential guidance. How should we think about those moving pieces?

Sure. I’ll start, maybe Brendan can jump in. In terms of just phase two, obviously we feel good about phase one completing the last 25% within the timeframe we mentioned hopefully in the second quarter. We still feel good about that. With regard to phase two, we’ve got broker opinions of value on a majority of the assets. We’ve had several inbound calls from interested parties. So we are in discussions on a few of those assets, but we don’t have a timetable. Now having said that, our disposition guidance we put out there is 100 million to 150 million and I would tell you a majority of that is going to be likely going to be phase two assets. So right now in terms of the timing, again we don’t have any assets on the market. We are in discussions. So it will be several months at the earliest before I think you’d see any activity.

Yes, Jamie, the only thing I’d add to that is that 100 million to 150 million of dispositions that are not included in the FFO outlook is pretty typical for us. And then we also have an acquisition range of 0 million to 200 million which also is not included in that FFO outlook. So as your question suggested, it does depend a little bit on where things ultimately shake out with respect to dispositions and acquisitions. But included within the parameters of the outlook range is roughly match funded between acquisitions and dispositions.

And you think you could do that FFO neutral, if you do match fund?

I think it depends. Certainly I guess as you look at the acquisitions that we’ve done over the past – we’ve only done one over the past four years at this point. That cap rate was lower than the disposition cap rates for a typical 100 million to 150 million of sales per year. But I think as we exhibited with the market rotation plan, we found creative ways to make that roughly FFO neutral. So I think there is – and I guess I’d say it probably depends.

Okay. And then just finally for me, can you talk about the Pittsburgh enrichment land you acquired in the quarter? And is this some of the land that might fall into the bucket of interest for build-to-suits already or is this kind of longer-term hold?

Hi, Jamie. Brian Leary here. Great question and I’m glad you asked it. So take Richmond first. The Richmond acquisition was 8.8 acres of land that kind of catalyzes and unleashes the 9 acre surrounding it that we’ve owned for quite some time. So you’re looking at about an 18 acre mixed use master plan that can be kind of unleashed and support the 1.5 million square feet of occupied office that we have around it in the Innsbrook market there. And so based on our initial kind of master planning, we can get about 900 multifamily units in the plan and another 300,000 square feet of office, a couple of hundred hotel keys and some retail to really create a strong mixed use environment that we would most likely master develop and have partners and other folks come in who do that for a living. And there has been tremendous interest and inbound on that. So that’s where the Richmond story is. So it does actually allow us to land and present two build-to-suit sites right on Interstate 295 in a way that we can’t right now. To Pittsburgh, this is a very interesting acquisition in the East Liberty high barrier to entry market. It’s down the corner from where Google has a major presence and Phillips is building out a build-to-suit. It’s across the street from a brand new target Warby Parker, Ace Hotel, Whole Foods and Bonobos as well. So it’s a very interesting market for small opportunity, but we’re really bullish on it because of the tremendous tech growth in the neighborhood, including locally minted Unicorn Duolingo.

And how soon would you start on either of those projects?

So on the Pittsburgh one, we’re going through designs and pricing. So we’ll have some flexibility to do that at our own timetable. And with regard to Richmond, it’s really a master planning and process. And so I think through the end of the year we’ll finish that work and then be talking to inbound interested parties to help us with a mix of uses during that time.

Great. Thank you very much.

Yes, sir.

We have a follow-up question from John Guinee with Stifel. Please go ahead.

Great. Two questions. One, you sort of half answered already. Thank you. What’s – on Pittsburgh and Richmond, what’s your – by the time you’re entitled and got your master plan all figured out, what’s your basis per square foot for the pad-ready dirt?

Hi, John. Thanks for the question. A couple of things and I’m glad you triggered a thought that I didn’t answer before. The East Liberty Pittsburgh location with regard to entitlement, it is basically fully entitled, which is a pretty big thing to have in Pittsburgh. And so in that case just from a buildable FAR foot, you’re probably into the mid to high 30s for where we’re thinking for that building. And then if you look at the land foot basis on Richmond, it’s really low. It’s about $8 and change. That’s just not even including the additional 9 acres. It’s catalyzing that we’ve had for some time with a pretty low basis, so good points there. And if I started adding the FAA or value of the vertical development, obviously it flipped that positive, it’s quite a number. So a little early to kind of nail that down as we go through our process, but we really love the entry points.

Okay. And then Mark or Brendan regarding raising equity via the ATM, what was the top tick when you raised equity last in 2016 and '17? Do you know where you talked out and where do you think it’s appropriate to raise equity on the next go around, meaning 2020?

John, I don’t have that number right at my fingertips, but it’s in the $51 – very close to $52, so just under $52 is the way I would have thought about it. We obviously filed the shelf and authorized a new ATM. We’d like to have that flexibility. I wouldn’t necessarily make a call on price. We’ve been able to fund all the BofA acquisition with disposition proceeds and kind of been able to keep the balance sheet in really good shape. So we’re not itching to do something here on the ATM, but we’d like to have the flexibility. And if it makes sense, if we have an opportunity, we got a chance to fund. We have 277 million left to fund on the development pipeline, which we have plenty of capacity to do here. So, again, we’re trying to just make sure we have all our options open.

Great. Thank you.

Thank you.

Our next question is from the line of Blaine Heck with Wells Fargo. Please go ahead.

Great. Thanks. Good morning. Maybe another one for Mark or Brendan. I just wanted to touch a little bit more on same-store guidance. I wanted to see if you could dig into some of the major drivers. As Brian I think mentioned, there is not much of an uplift in occupancy implied in the year-end occupancy guidance number. So I guess can you just give some detail on whether that 3.75% midpoint is driven mostly by an uplift in rents, is there any expense moderation in there or is there some component of burn-off of free rent that’s playing a big role?

Yes. Hi, Blaine. It’s Brendan. It’s a good question. So overall, the midpoint, as you mentioned, up 3.75% is included in the guidance. Within that number is average occupancy that is down a little bit. That is predominantly driven by the remaining phase two assets in Memphis. So excluding those average occupancy within the same-store pool would be up a little bit. And probably for the core eight markets, excluding the residual phase two assets, we think that same property growth would probably be up 25 to 50 basis points higher than the range that we provided last night. Really it’s being driven by revenue growth overall. So our revenue growth is up probably around 4% on the overall pool. Expenses are up a little bit more than that. So it’s not an expense-driven – it’s not an expense-driven metric for this year. That same property growth is being driven more by top line. We’ve got expenses that are probably up on balance around 4.5% and taxes are the biggest driver of that overall increase. So we think it shows a lot of health within the business and the positive leasing fundamentals that we’ve been reporting over the past many quarters we think are showing up in that same property growth. And there is – I think you also asked a little bit about straight-line rent. It’s helping a little bit. So the cash number we would expect to be a little bit better than the GAAP number for 2020, but that’s pretty typical for us. I wouldn’t say that that’s a major driver of the underlying same property guidance that we provided.

Okay, got it. That’s very helpful. And then switching gears over to kind of earnings in FFO and it’s kind of the follow-up on an earlier question, how should we think about the FFO cadence for this year given that you guys have so many moving pieces? You’ve got the NOI from phase one dispositions that will be going away as you get those sales done. You have – possibly you have additional sales throughout the rest of the year and you’ve got some G&A headwinds in the first quarter, but you also have – on the other side, you have some upside from a full quarter of BofA Tower, maybe a little upside from development deliveries and leasing throughout the year. How do all those drivers interact with each other? And can you give us any sort of an idea of where does that quarterly FFO inflection point or bottom occur?

So, Blaine, just I’ll start and Brendan can chime in and add color if we need to. So our FFO guidance, we expect obviously just as you described, a little G&A increase in the first quarter the way we treat our incentive payments. And we think that’s – some of that’s going to get offset by some of the – still having some of the phase two assets contributing. So we actually expect that FFO is going to be on an upward trajectory toward the back half of the year. Our typical OpEx – highest quarter for OpEx is in Q3. But we do expect some upward trend in FFO, as we get towards the end of the year and that’s kind of incorporated in our guidance.

Great. Thanks, guys.

Thank you. Our next question is from the line of Rob Stevenson with Janney Montgomery Scott. Please go ahead.

Good morning, guys. Can you talk about where pricing has come out on the completed Memphis/Greensboro dispositions thus far versus your expectations heading into the process?

Sure. In terms of where we are so far, we closed two buildings. We announced about 90 million of sales in the fourth quarter and that was roughly a 6.6% cash and GAAP yield. And then the industrial portfolio combined with The Knollwood, which is going to close here in the next couple of weeks, that’s really a combined 6.1% cash and GAAP as well. So we’ve been very pleased with phase one thus far. Certainly it’s met our expectations.

Okay. And then once Knollwood closes, what’s the rough dollar value remaining on the total market exit between Memphis and Greensboro?

So, as a reminder, we still do have remaining 25% of phase one to get done. So it’s somewhere in that probably mid-300s, something like that.

Okay. And then you guys are always good about talking about the 100,000 square foot move outs. Any incremental known move outs of note in the sort of 50,000 to 100,000 square foot range sitting here today that may have higher rents and have an impact on you guys?

Sure. So let me just run down maybe the 2020s and the first three we’ve talked about now for a few quarters. First is the FAA, which is actually in holdover now that expired last year, third or fourth quarter. They’re on month to month. We’re still confident we’re going to get a renewal done with those guys that’s right at 100,000 feet. And we’ve got T-Mobile that’s going to be vacating 116,000 feet at the end of the second quarter. And we’ve got prospects there for a couple of full floor users, but very early. We’re touring, so just starting to talk to those guys. And then on the FBI is – towards in the fourth quarter about 138,000 feet and we feel pretty confident we’re in discussions with those guys as well and think we’re going to get a long-term renewal out of the FBI. So your question after that, we’ve got about an 85,000 square foot customer that expires at the end of the first quarter and we feel very confident that’s going to be a renewal. We’re deep in negotiations there, so we feel good about that. And then after that, we dropped down to about 68,000 foot customer that is very close to being renewed as well. So we feel very comfortable with both those. And then after that, it drops down to 61,000 and that’s a vacate. It’s a customer that we just – we moved to another building and downsized them a little bit, and we have some pretty good prospects to backfill half of that already. So after that we’re really sub, but we do have one more 54,000 foot that we’ve already backfilled half of that. So we think we’ve taken care a lot of the big ones and we feel good about them.

Okay. Thanks, guys. I appreciate it.

Our next question is from the line of Adam Gabalski with Morgan Stanley. Please go ahead.

Hi, guys. Thanks for taking the question. Just wanted to get your thoughts on any incremental opportunities for growth in Charlotte. Now as the market rotation plan is a little further underway, what kind of deals you’re seeing in the market, what your appetite is for getting a little bit more aggressive in pursuing something?

Good morning, Adam. Brian Leary here. Thanks for the question on the Queen City. I’m also the de facto kind of division lead on Charlotte at the moment. So we’ve been spending a lot of time, quality time in Charlotte with our friends and partners there and feel optimistic that kind of a multi-pronged approach with regard to land development and acquisitions are going to bear fruit. We believe through that there’s opportunities to source off market and be aggressive if we need to. But I think that we’ve got a great story across multiple submarkets in Charlotte.

Got it. Thank you. And then just one more. You mentioned previously that you are starting to develop sort of spec suites to give small tenants an alternative to co-working. Just kind of wanted to get your latest thoughts on that project and how you think it’s playing out.

Sure. This is Ted. It’s playing out really well. So a couple of years ago, we made a concerted effort to start a spec suite program really in all of our markets and to date we’ve built out, I think it’s a little over 100,000 square feet of spec suites. And we track how long – how long were the space vacant prior to building it out and how long after we build it out. And the metrics from a velocity standpoint have been very attractive to us. So it’s a program that’s working. Certainly, we’re pulling some of those customers out of existing co-working spaces as well as just capturing demand that they want an immediate plug and play with modern space. So our spec suite program is working pretty well.

Great. Thank you.

The next question is from the line of Manny Korchman with Citi. Please go ahead.

Hi, guys. Ted, I believe in your prepared remarks you talked about kicking off some new developments. If you had to guess today, what markets would those new developments be in?

Sure. We’ve got right now more than a handful of very active discussions going on. We’ve made pitches for both build-to-suit full building users as well as partial building users and we’ve made those pitches I think in four different markets, multiple pitches on a couple of the markets. So right now, it’s sort of hard to tell. Sometimes these discussions can go on for a long time. So we don’t know exactly when something may hit or even if it’s going to hit at all. So again, four of our markets we’ve got active discussions going on and it just depends on sort of the timing of the customer.

If all four of those were to hit, would you be outside of the range that you’re giving guidance or does that include the possibility for all of those starts?

Very rarely we hit all of our pitches. Some of these things are multi – at least one of them is multi-city still. So if we hit all of them, I think we’d be outside our guidance. But again, that’s sort of typical for us. We’ve always got a lot of active discussions going on and we haven’t been 100% probably ever.

Great. Thank you.

Thank you. [Operator Instructions]. The next question is from the line from Jamie Feldman with Bank of America. Please go ahead.

Thank you. Very strong leasing spreads in the quarter. Can you talk about your outlook for this year and then just maybe just the mark-to-market of the portfolio today?

Sure. Jamie, it’s Ted. I think our mark-to-market is – we try not to say it, but it’s – we’re definitely under market as we continue to go through the cycle. We’re optimistic that just the discussions we have, the activity we have, that we’re going to be able to capture the continued increase in market rents over the next year. So I think we’ve got roughly 10% of our customers expiring and we should be able to capture we think pretty healthy spreads going forward as well, similar to what we’ve done in the last several quarters.

Okay. And then I think when you talked about the different markets, it sounds like kind of 4%, 4.5% rent growth pretty typical in your markets this past year. What do you think that looks like for 2020?

Yes, I’d put them maybe in two different buckets. The higher end might be even 6% or 7% in the last 12 months or 6% to 8% even at Raleigh, Nashville, Tampa, Charlotte and Atlanta. And then on the lower end, call it 2% to 3%, it was probably Pittsburgh, Orlando and Richmond and I think that’s probably a fair barometer for the next 12 months.

Okay. And then just in terms of large blocks you have left to lease, can you just talk us through the leasing pipeline?

Sure. The largest block is going to be backfilling T-Mobile at the end of the second quarter and I briefly touched on that. We’ve had a couple of full floor prospects. We wouldn’t say strong prospects yet, but they’ve toured the space and we’re in early discussions. After that it’s the last three floors of 5332 Avion, very similar there. We’re in process of white-boxing the lower three floors right now as well as doing tours of the building. So that’s about 90,000 feet or so. And then after that, it’s really a few 50s and a couple of floors obviously on our development. We’ve got two building still with a lot of spec space, Virginia Springs II and Midtown Tampa. Those buildings we still got over a year until – Virginia Springs I think delivers later this year and then Midtown Tampa next year. So we still got some runway to get some activity there and we’re seeing good prospects on both of those. We just got to convert them to leases.

Okay. And then last, now that you have some visibility on the final plan at Avion, what do you think the total CapEx cost to reposition those floors and get them leased out will be?

So just on the capital, again we’re still – so while we’ve got – we’re pricing it. I think some of it depends on the – there is a variability just on what the prospect of the user needs. If you tour the building, it does have a staircase right in the front. So if we can get somebody to take the first couple of floors, we’ll save money by not having to take out the grand staircase. There is an extra elevator at the end of the building that depending on a potential user they may or may not want. And then there’s some extra HVAC as well on one of the floors that may or may not stay. So there is a little bit of a range there, but I’ll tell you the CapEx between white-boxing and improving the – some of the building is probably $3 million to $4 million in that range.

Including the conversion from medical to office?

Correct.

Yes, that is – Jamie, that is the conversion from sort of the medical to office, right. And then I think from a TI and leasing commission, leasing capital perspective, I think you have probably a pretty good handle in terms of what those costs would be. And obviously we’ve got a little over half the building leased and then we’ll do deals that we would expect would be in line with market for the balance.

What are market TIs right now?

Jamie, market TIs, we’re probably looking at up to $35 to $50 a foot depending on the rental rate we can get.

Generally $5 per year of lease years just for a new lease.

Okay. All right, great. Thank you.

We have a follow-up question from Blaine Heck with Wells Fargo. Please go ahead.

Thanks. Just one more probably for Brian. Atlanta have seen an influx of supply over the last couple of years and there seems to be a decent amount of potential speculative construction that’s teed up to go. I think most of it has been concentrated in the Midtown market so far, which is not where your properties are. But are you guys concerned at all with the amount of construction affecting the overall rent growth potential within the market as a whole, or do you see enough kind of demand to keep rents moving up?

Blaine, great question. It’s interesting. We were actually talking about Atlanta specifically. As you probably know, Ted and I both lived there for a good period of our career and I have been following it very closely with our team in Atlanta. So while most of the new growth is in Midtown, you’re starting to see some of those big moves and speculative moves be rewarded by occupancy as the likes of Google continues to expand there. And if you saw the headline as even yesterday, Macy’s announced 400 jobs that they’re relocating out of San Francisco into Midtown Atlantic Station into the T3 building there. So we were talking about just kind of occupancy or vacancy, if you will, has been somewhat static but rents continue to grow I think for the best-located, walkable office product. So we’re sitting back, obviously feeling really good about where we are in Buckhead and continue to kind of tell a little different story there from a Buckhead standpoint. Obviously looking very closely at Midtown, love all the fundamentals. But I think we’re fairly optimistic about what’s happening in Atlanta where rents continue to grow and people continue to move there by the truckload.

Great. That’s helpful color.

And there are no other questions at this time. I’ll turn the call back to you.

Well, thanks everybody for joining us this morning. If you have any follow-up questions, we’re here and available. If not, we’ll talk to you next quarter. Thank you.

That does conclude the conference call for today. We thank you for your participation and ask that you please disconnect your lines.