Welcome to The Macerich Company Second Quarter 2015 Earnings Conference Call. At this time, all participants are in a listen-only mode. Following the presentation, we will conduct a question-and-answer session. Instructions will be provided at that time for you to queue up for questions. I would like to remind everyone that this conference is being recorded and would now like to turn the conference over to Jean Wood, Vice President of Investor Relations. Please go ahead.

Thank you everyone for joining us today on our second quarter 2015 earnings call. During the course of this call, management will be making forward-looking statements, which are subject to uncertainties and risk associated with our business and industry. For a more detailed description of these risks, please refer to the company’s press release and SEC filings. During this call, we will discuss certain non-GAAP financial measures as defined by the SEC’s Regulation G. The reconciliation of each non-GAAP financial measure to the most directly comparable GAAP financial measure is included in the press release and the supplemental 8-K filings for the quarter, which are posted in the Investors section of the company’s website at www.macerich.com. I also want to announce that Macerich will be hosting a property tour of Tysons Corner Center and the new mixed-use development on Thursday morning, October 1st. You have the opportunity to stay at the new Hyatt Regency Tysons Corner Center. We will be sending out a save-the-date with more details soon. Joining us today are Art Coppola, CEO and Chairman; Tom O'Hern, Senior Executive Vice President and Chief Financial Officer; and Robert Perlmutter, Executive Vice President, Leasing. With that, I would like to turn the call over to Tom.

Thank you, Jean. Consistent with past practice, we’ll be limiting the call to one hour. If we run out of time and you still have questions, please do not hesitate to call me, John Perry, Jean Wood or Art. It was another very strong quarter for us. We are now really starting to see the benefit in our operating results from all the major portfolio transformations we have done over the past two years. This includes the sale of 15 malls and the redeployment of that capital into more productive faster-growing assets. Leasing spreads were good again this quarter and we saw strong yield volume on 335,000 square feet of shop spaces and the average deposit of re-leasing spread compared to the expiring rent was 17.5%. Mall occupancy was again very high at 95.5%, up 10 basis points from a year ago, as well as up 10 basis points sequentially from last quarter. Temporary occupancy remained relatively flat at 5.3%, up slightly from 5.2% at June 30 of ’14. In light of the very significant retail bankruptcies in the second half of last year and early ‘15 this are very good occupancy results. Average mall store base rents increased to $53.62 that was up 9% from a year ago. Looking at FFO for the quarter we reported this morning FFO at $0.89 per share that compared to $0.86 in the second quarter of 2014. Reflected in was $1.6 million loss on extinguishment of debt, as well as $11.4 million of expense related to an unsolicited takeover attempt and contested proxy, together they makeup $0.08 a share. Excluding those two items FFO was $0.97 per share for the quarter ahead of both our guidance range and consensus estimates. Same center NOI during the quarter increased 7.5% compared to the second quarter…

Thanks, Tom. As Tom indicated the second quarter leasing metrics were good. Leasing spreads for the trailing 12 months were up 17.5, occupancy rose by 10 basis points to 95.5%, sales reached $623 a foot. Bankruptcies moderated significantly from the previous quarter and our signed leases for tenants over 10,000 square feet was strong with over 450,000 square feet signed during the quarter including three locations with H&M. Demand from retailers for the company’s mall locations and outlet venues continues to be positive. We see retailers seeking to tie in multi-channel retail opportunities and further establish their brand identity. In addition we see emerging brand and foreign retailers entering the U.S. through store locations, which are typically on the East and West Coast and that aligns with our portfolio. Tenant bankruptcies during the first quarter provide a significant headwind with eight national retailers declaring bankruptcies. These tenants affected 76 stores containing approximately 247,000 square feet, which generated sales of only $241 per square foot. Included were larger chain such as RadioShack, Wet Seal, and Cache. Some of this impact has been mitigated with approximately 46% of the space either leased or approved and in lease documentation. We have seen and expect to continue to see some retailers with larger store fleets reduce their store count. This is illustrated by Gap’s recent announcement to close 175 stores. Most of these store closures are effectuated through natural lease expiration as oppose to lease buyouts. We continue to believe the quality of the company's portfolio reduces the impact from both bankruptcies and store closures, which we believe will be felt disproportionately in the lower quality centers. Leasing progress continues to be made at Broadway Plaza located in Walnut Creek, California. The initial portion of the first phase will open this November with 22…

Thank you, Bob and thank you, Tom. We’re very pleased with our operating results and with all of our metrics that we have put up here for the first six months. And as you can see by our guidance adjustment, we’re very bullish about our future, mid-term as well as longer term outlook. Same-center NOI is significantly above the guidance, even the high end of the guidance range that we provided at the beginning of year. And one might ask, what is the new normal as I look at it. Tom mentioned that he sees total same-center NOI of around 6% on the portfolio this year. And we’re not in a position yet to give guidance for 2016 and ‘17. But we internally are expecting to see same-center NOI growth in that same range of 6% over the next couple of years or so. And that’s largely been put into place as a consequence of re-leasing activity, consequence of the margin improvement, some of which are yet to come, particularly on the revenue side. But we are very, very bullish on our ability to improve our margins. It was asked, I know, by one analyst, well have your really changed your business practices on the expense side to increase your margins. And the answer is really no. We are fortunate enough this year to have a couple of major portfolio contracts for maintenance security for example, come up for renewal and given the strength of our portfolio and the quality of the assets and the size of the assets, we’re able to negotiate significant reductions there as well as in other areas. So we’re very pleased about all of our operating metrics and the performance of the company and the outlook for the future on the leasing side. On the…

Thank you. [Operator Instructions] We’ll take our first question from Craig Schmidt with Bank of America.

And we’ll take our next question from Alexander Goldfarb with Sandler O'Neill.

And we will take our next question from Michael Mueller with J.P. Morgan.

Todd Tom is next with KeyBanc Capital Markets.

Thank you.

And from Citibank, we have Christy McElroy. Please go ahead.

We haven’t given any additional guidance on 2016 yet, Christy. It would be premature to do that at this point.

No.

And we will take our next question from Steve Sakwa with Evercore ISI.

And from Deutsche Bank, we have Vincent Chao. Please go ahead, sir.

Well, I think from a category standpoint, some of the stronger categories have been home furnishings, jewelry, athletic apparel, and athletic footwear, those would be some of the strongest. Regionally, the West Coast and Arizona has led the sales increases. As I mentioned, what we see principally in terms of sales growth is many of our core tenants that occupy space in almost everyone of our centers, I think I mentioned some like Sephora and Victoria's Secret and Foot Locker, they have had very good sales trends. Kay Jewelers is another one that had good sales trends. And then you do have the impact of the unique high volume retailers like Apple and Tesla. I think the weakest part of the market has been the apparel, and that is important for the malls because they do occupy a significant portion of the mall space. And that’s probably been the softest part of the market.

Tom O’Hern:

And next, we will take Paul Morgan with Canaccord Genuity. Please go ahead, sir.

Tom O’Hern:

And we have Rich Moore with RBC Capital Markets next. Please go ahead.

And from Jefferies we have Tayo Okusanya. Please go ahead.

And we’ll take our next question from Haendel St. Juste, Morgan Stanley.

And we’ll take our next question from Ki Bin Kim with SunTrust.

Ladies and gentlemen, at this time, this does conclude our question-and-answer session. I would now like to turn the call back over to our speakers for any closing and additional remarks.

Thank you for joining us. Again, we’re pleased with our results. We’re not sitting back and going to rest on our laurels. We are very bullish in our ability here to continue to put up outsize growth over the next several years, both from an operational view point, as well as from a value creation view points for our development, redevelopment pipeline that’s currently there and as it gets expanded. So look forward to speaking with you, seeing you and thank you again for joining us today. Thank you.

Ladies and gentlemen, at this time, this does conclude today’s presentation and we appreciate everyone's participation.