BPG(US:BRX)2020-11-06 00:41Financial Data and Key Metrics Changes - Third quarter cash collections improved to 88.2% compared to 84.5% for the six months ended September 30 [9] - NAREIT FFO for the third quarter was $0.36 per share, with same-property NOI growth at negative 9.3% [27] - Total liquidity improved by over $400 million to $1.9 billion, including over $600 million in cash [31] Business Line Data and Key Metrics Changes - New leasing production accelerated with nearly 700,000 square feet of new leases signed at an average cash spread of 14% [12] - The total leasing pipeline stands at over 2.1 million square feet and $36 million in annual base rent (ABR) [13] - Bad debt reserves decreased, reflecting a proactive management approach [11] Market Data and Key Metrics Changes - Over 97% of tenants are open and operating, with traffic levels trending around 92% of prior year levels [8] - The remaining 7% of ABR not addressed is concentrated in entertainment, small-format fitness, and full-service sit-down restaurants [10] - Rent collections for tenants on cash basis improved from 36% in Q2 to 57% in Q3, and over 58% in October [26] Company Strategy and Development Direction - The company aims to drive value and growth through disciplined spending and proactive tenant management [7] - Focus on community-centered properties and enhancing tenant mix with specialty grocery and quick-service restaurants [12][18] - The company plans to reinvest in its portfolio with a forward reinvestment pipeline of $373 million at an incremental return of 10% [15] Management's Comments on Operating Environment and Future Outlook - Management expects elevated levels of tenant failures due to the pandemic but believes the company can create value through its platform [19] - The reinstatement of the dividend at $0.215 per share reflects confidence in the company's forward plan [20] - Management is optimistic about the recovery of cash collections and tenant performance as the economy stabilizes [56] Other Important Information - The company has completed 120 reinvestment projects over four years, representing over $450 million of investment at an average incremental return of 10% [18] - The company is generating ample free cash flow and has no debt maturities until 2022 [31] Q&A Session Summary Question: What is the expected impact of remaining bankruptcy exposure? - Management estimates that about half of the ABR exposure from tenants in bankruptcy may be lost over time [35] Question: How is the portfolio performing in terms of below-market rents? - The company continues to demonstrate strong spreads on new leases, with expectations for mid-to-upper teen spreads in the coming quarters [37] Question: What is the outlook for tenant demand and leasing activity? - Management is encouraged by robust demand in categories such as specialty grocery and fast-casual restaurants, with leasing activity expected to grow [46][50] Question: How will the company deploy its capital in the near future? - The company plans to evaluate options for early debt repayment and fund redevelopment projects as confidence in the business improves [52] Question: How does the current dividend relate to taxable income? - The reinstated dividend is set conservatively to ensure it aligns with taxable income while allowing for capital retention for reinvestment [58][80]