Dream Office Real Estate Investment Trust (DRETF) Q4 2022 Earnings Call Transcript

Dream Office Real Estate Investment Trust (OTC:DRETF) Q4 2022 Earnings Conference Call February 17, 2023 10:00 AM ET

Company Participants

Michael Cooper - Chairman & CEO

Gordon Wadley - Chief Operating Officer

Jay Jiang - Chief Financial Officer

Conference Call Participants

Sairam Srinivas - Cormark Securities

Mark Rothschild - Canaccord

Mario Saric - Scotiabank

Matt Kornack - National Bank Financial

Sam Damiani - TD Securities

Operator

Good morning, ladies and gentlemen. Welcome to nan Dream Office REIT Fourth Quarter Conference Call for Friday, February 17, 2023. During this call, guidance of Dream Office REIT whitethorn make statements containing forward-looking accusation wrong nan meaning of applicable securities legislation.

Forward-looking accusation is based connected a number of assumptions and is taxable to a number of risks and uncertainties, galore of which are beyond connected Dream Office REIT’s power that could origin existent results to disagree materially from those that are disclosed successful aliases implied by specified forward- looking information. Additional accusation astir these assumptions and risks and uncertainties is contained successful Dream Office REIT’s filings pinch securities regulators, including its latest yearly accusation Form and MD&A. These filings are besides disposable connected Dream Office REIT website astatine wwwt.dreamofficereit.ca. Later successful nan presentation, we will person a mobility and reply session. [Operator Instructions]

Your big for coming will beryllium Mr. Michael Cooper, Chair and CEO of Dream Office REIT. Mr. Cooper, please spell ahead.

Michael Cooper

Thank you very overmuch and invited everybody, to our yearend convention call. I wrote a study to nan committee and referred to it emotion for illustration groundhog Day complete and complete again successful nan agency sector. I'm present pinch Gordon and Jay, they'll woody pinch nan financials and nan agency operations. I conscionable want to talk a small spot astir immoderate of nan strategy and different opportunities we're seeing. Last month, we closed nan sale of 720 Bay, nan highest and usage and worth was arsenic a wellness subject building. We're pleased pinch nan sale. I ever for illustration nan building. I deliberation nan building is going to execute good successful immoderate shape complete nan agelong term, but it's a bully opportunity to get liquidity. This 4th pinch a cardinal quadrate ft building is astir a 4th of nan abstraction that we person successful nan Discovery District.

And I deliberation it proves retired that nan Discovery District has an further worth complete conscionable different agency building. It's not a commodity. So we person different 750,000 quadrate feet there, including 250 Dundas and we deliberation that's beautiful exciting. In addition, we ain astir 26 cardinal shares successful Dream Industrial and it's been doing very well. It's astir $400 cardinal of finance and liquidity and that's a beautiful exceptional plus for Dream Office. At 2200 Eglinton, we mentioned that we've received support for astir 2.5 cardinal quadrate feet of residential density for nan astir portion successful summation to nan 165,000 quadrate ft agency building. Basically nan density is divided into 4 phases, astir 600,000 quadrate feet each. We're successful discussions now pinch nan developer. We cognize very good for them to create condos connected nan first shape and aft costs nan density astir apt astatine astir $70 a foot. With 2.5 cardinal quadrate feet that's astir $175 cardinal positive 165,000 quadrate ft agency building. So erstwhile we get each nan zoning done, erstwhile we get make advancement connected it nan $110 cardinal book worth could go $200 cardinal and that's an further $2 a stock basically.

The Bay Street postulation is coming on awesome and Gord has a batch of updates connected it. But conscionable a mates of different examples. 74 Victoria is zoned residential. That's wherever nan Passport Office is. The national government's attendant there. It's connected Young Street. It's betwixt nan King and Queen subway stop. And we could build a important residential building location if we decided to spell up pinch that. 30 Adelaide, it's absorbing because if we tin destruct nan request to switch nan agency abstraction which seems logical fixed nan desired for housing. It's astir apt worthy $300 cardinal conscionable arsenic a residential development. So we spot tons of worth arsenic agency buildings. Our Bay Street postulation is going to beryllium occupied pinch each nan activity will beryllium done, nan restaurants will beryllium successful place. I deliberation it'll beryllium very exciting, and our different agency buildings are doing very well, and we've sewage tons of opportunities to get other worth retired of our institution speech from office. So that's wide overview. I'm happy to reply questions astatine nan end, but gentlemen, do you guys want to commencement your comments?

Gordon Wadley

No problem. Thanks a lot, Michael. Well, bully morning, everyone. It’s Gord Wadley. First and foremost, I dream you're each keeping really well. It's bully to get a chance to link pinch you coming and stock immoderate of our activity that nan teams completed not conscionable successful Q4, but complete nan people of nan year. I look guardant to sharing immoderate of nan large news and nan cardinal milestones regarding our plus plans. As Michael mentioned, we've now afloat completed our Bay Street postulation and we're rather proud of it. Since we pushed good past nan nationalist wellness crisis, our squad has been moving successful unison pinch existing tenants, caller tenants and prospects to guarantee a seamless modulation backmost to our buildings. That being said, nan return to agency rebound galore expected, has been a spot tampered erstwhile you measurement it by accepted indicators akin to occupancy and nett caller absorption.

However, connected our team, there's existent optimism erstwhile looking astatine early commitments, circuit activity, trailing occupancy, and for illustration Michael mentioned, caller retail. On nan costs side, we're seeing immoderate stabilization connected materials and finishing trades, which we consciousness positions Dream Office very good successful nan years ahead. Anecdotally successful nan 13 years that I've worked astatine Dream, we've ne'er printed much parking passes aliases information entree cards than we did complete nan people of nan past 2 quarters successful 2022. From a macro perspective, wide vacancy successful Toronto has stabilized to astir 14% crossed each classes. This is simply a level not seen since nan Great financial crisis. From our perspective, vacancy successful our halfway portfolio has moved successful lockstep pinch marketplace dynamics, taking america to an wide existent and committed complaint that's somewhat amended than marketplace astatine astir 88%. Despite immoderate of nan manufacture challenges and what you publication successful nan news and societal media; we're starting to spot immoderate worldly improvement. It was nan astir progressive twelvemonth of leasing for Dream Office successful nan past 3 years, pinch rents holding up very, very good connected nan conscionable complete 700,000 quadrate feet of deals we completed during nan people of 2022. That's successful opposition to nan 480,000 quadrate feet of deals we did nan twelvemonth earlier that, and we proceed to spot really affirmative momentum and immoderate expanding activity going into nan outpouring pinch a number of prospects and immoderate conditional deals totaling almost different 100,000 positive quadrate feet.

Closing retired Q4, we completed astir 25 transactions for almost 180,000 quadrate feet and complete 110 deals for almost 700,000 quadrate feet for each of 2022. For immoderate further context, we did 7 transactions complete 25,000 and this is important, we did different 4 transactions complete 50,000 quadrate feet. So from our perspective, worldly deals of standard are getting done and companies are making large commitments, albeit they're taking a small spot longer, and nan tenants are overmuch much pragmatic pinch their superior outlays and they're yet being overmuch much prudent pinch their equilibrium expanse fixed nan uncertainty astir ostentation and their costs of capital. Our rates person been very resilient and we saw mean nett rents up 8% versus budget, but fixed immoderate of nan costs pressures, NERs stay mostly level year-over-year. We've seen a marked betterment successful nett rents, and that's a existent testament to nan value and nan location of nan buildings that we own. The efforts of our operating squad and yet staying existent to our plus and superior strategy. Our building and improvement squad has managed very well. And I tin now officially opportunity coming that we've completed each our awesome activity connected 8 buildings that dress up our Bay Street Collection.

In conjunction pinch world people hospitality and edifice designer Paolo Ferrari, we've completed 7 lobbies, 112 bathrooms, 8 reef facades, and dramatically upgraded each cardinal guidelines building components, including elevators, HVAC, mechanical and successful summation to each this, we further proceed to dramatically trim our c footprint successful business pinch nan Canadian Infrastructure Bank, toward our extremity of being nett zero by 2035. I want everyone to support successful mind that's almost 15 years earlier than nan commitments announced by our national government. I look guardant to getting an opportunity to circuit anyone connected this telephone who's interested. It'd beryllium awesome to locomotion you done successful personification and stock firsthand each nan awesome activity our squad has done. We're really proud of it.

On our past call, we mentioned we are adjacent to announcing a number of best-in-class unit and hospitality concepts that align pinch our bold imagination for Bay Street Collection. We worked very difficult to create a caller people of plus known arsenic boutique luxury successful nan halfway of nan financial district. And adding these curated unit amenities successful business pinch immoderate of nan globe's apical edifice tours and [inaudible] makers we judge will make our halfway assets very appealing. Executing connected our hospitality strategy has been a awesome catalyst to attracting and retaining immoderate of Canada's astir discerning companies. And we've seen this complete nan people of past twelvemonth pinch 25 agency deals done connected Bay Street Collection astatine an mean nett rent of complete $38 a foot. The past fewer quarters, we've been highlighting nan negotiations of completing immoderate marquee deals. We're very proud to opportunity coming that we've completed 4 deals pinch arguably Canada's apical edifice tours that full complete 30,000 quadrate feet and 2 much conditional.

When completed, this will full astir 45,000 quadrate feet of full unit absorption astatine mean rents adjacent to $70 a quadrate foot, and annualized NOI effect of an further $3 million. These are each successful our astir desirable assets, completing and supporting our extremity of bringing an elevated and each caller acquisition of boutique luxury that is wholly unsocial to Toronto's financial core. We're very proud to stock coming that we are bringing [Nelos] to Toronto. We are moving very intimately pinch owner, [Kostas Spiliotis] and his team. Nelos has grown from its roots successful Montreal and is now 1 of nan astir sought aft edifice brands globally.

This is an perfectly unthinkable experience, not conscionable for our buildings, not conscionable for our tenants, and not conscionable for nan financial core, but I really judge it will beryllium a awesome tie for nan city. And our squad is very proud to beryllium moving pinch Costas and nan squad astatine Nelos. Also today, we want to stock we've reimagined our conception of our alleyway project. We've collaborated pinch Charles Khabouth's Ink Entertainment Group to unfastened an unthinkable caller conception to Bay Street that will person an elevated outdoor municipality oasis successful nan alleyway. This is an amenity that's been missing to day successful downtown Toronto. Ink's agelong history arsenic a nutrient and intermezo impresario is an absolute crippled changing summation for nan financial core, and it's an breathtaking characteristic that everyone tin stock astatine connected nan Bay Street Collection. We're besides very proud to opportunity that we person 1 of Toronto and 1 of Canada's champion restaurants joining our portfolio pinch [Aloe] astatine Adelaide Place, arsenic good arsenic a premier Omakase restaurant. We person 2 much unthinkable offerings besides nether contract, that should adjacent adjacent 4th and let for an other 15,000 quadrate feet of nett caller unit absorption. Quarter-over-quarter, we stay comparatively level connected our existent and committed. We're disconnected by astir 20 ground points connected an apple-to-apples basis, but want everyone to cognize connected this telephone that 2 of nan ample deals that we anticipated to adjacent successful Q4 are still conditional connected immoderate lagging municipal approvals, which we consciousness assured we'll get.

We person immoderate very cautious optimism pinch nan further 150,000 quadrate feet of LOIs and conditional deals successful very progressive negotiation. We'll study connected these successful consequent quarters. Even going into this quarter, we secured a very important multi level deal, and further cardinal renewal that retains 2 ample tenancies astatine 20 and 36 Toronto. As a portfolio, we recovered 100% of expiring revenues successful 2022 and are already patient and committed connected conscionable complete 80% of expiring income successful 2023. In nan existent pipeline, we're actively negotiating and trading insubstantial connected complete 14 deals and RFPS responses for 300,000 quadrate feet crossed some portfolios. There's a batch of property and attraction astir protector vacancy and nan authorities of nan sublease marketplace successful Toronto. To beryllium honorable pinch everyone, this hasn't been an rumor aliases thing we're seeing successful nan REIT. Currently successful our portfolio, there's conscionable astir 75,000 quadrate feet of abstraction disposable for sublet aliases put differently, it's little than 1.5% of nan portfolio nationally.

In Saskatchewan and Calgary, occupancy is flat. We sold Princeton Tower, our existent and committed occupancy went from astir 76 to 78.8. Tours and activities successful those markets person picked up. We've precocious received and are responding to galore RFPS pinch each levels of government. Our existent and committed occupancy is hovering astir 88% successful our halfway portfolio. For further context, if we didn't waste 720 Bay, our existent and committed would beryllium person to 90.

Collections proceed to beryllium very beardown astatine complete 99.5% for nan year. Our mean WALT successful nan portfolio is still rather precocious astatine conscionable astir 5.3 years. Operationally and of awesome importance, I besides want to update connected our ESG goals achieved this past twelvemonth astatine Dream Office.

While nan Dream Organization has ever emphasized nan value of being bully firm citizens, we're making it an absolute privilege to summation transparency, arsenic much than ever, investors want to cognize really businesses are incorporating ESG principles into their operations and successful unison, really we're building connected our early successes successful this arena. Over nan people of this past year, we highlighted immoderate of our accomplishments, which included our reductions successful power and h2o consumption, discarded management, greenhouse state emissions, arsenic good arsenic a number of highlights connected worker improvement and nan diverseness of our workforce. We've rolled retired our Source Social Procurement Policy precocious successful 2021, which we allot 20% of statement awards to equity seeking groups and stay connected target for nan goals that we want to achieve. We established a Diversity Inclusion and advancement squad to guarantee that our full workforce has each adjacent opportunity to succeed, and besides nan trades, contractors and work providers align and stock their inclusivity policies pinch us.

This is to guarantee everyone we woody pinch is doing their parts to beryllium leaders successful inclusion. One halfway extremity was to amended connected our nationalist starring GRESB people that we secured successful 2021, which is often regarded arsenic nan starring sustainability benchmark successful our industry. We deliberation this will beryllium a valuable connection instrumentality for our tenants and investors, some backstage and public. In 2022, we were capable to successfully summation our people to 92 retired of 100, making america nan apical performer nationally and nan 3rd champion successful North America while maintaining our 5 prima rating. We're besides continuing to activity toward our extremity of further greenish building certifications for our properties, and we are named successful 2022 Platinum by Green lease leaders. When upgrading our assets, we put a existent attraction connected improving depletion metrics and information of GHG and c utilization associated pinch our wide nett zero strategy. These variables are astatine nan absolute forefront of what we dream will abstracted america from our peers.

As a landlord and a leader, we person a tremendous opportunity and work to power and amended our c footprint and successful turn, align pinch nan increasing sustainability demands of our clients. We each activity really difficult connected implementing our ESG strategy passim our portfolio. Being a bully organization and biology steward is perfectly halfway to our business, and arsenic tenants go overmuch much blase successful their committedness to nan situation and nan community, we want to beryllium fresh to stock strategies, beryllium a resource, and yet partner to make very meaningful contributions to support sustainability successful nan environment. Overall, our extremity is to beryllium recognized arsenic 1 of nan apical sustainable REITs successful Canada, and we look guardant to sharing our advancement complete nan coming quarters.

In closing, and ultimately, I consciousness really bully astir our portfolio. The value improvements that we've made to our assets, some astatine an operating and artistic level, put america successful a very beardown position arsenic tenants proceed to fig retired what their agelong word plans are astir their circumstantial accommodations. Our biggest partners and tenants, each 3 levels of government, person been really awesome champions of nan activity we're doing astir biology and organization stewardship. But I'd opportunity to everyone, beingness assets aside, I really couldn't beryllium much pleased pinch really nan teams navigated done immoderate of nan evolving challenges to nan industry. Their effort, their dedication to not only our company, but to our clients is what I'm candidly astir proud of. At nan extremity of nan day, it's this operation of having irreplaceable assets coupled pinch nan quality, precocious characteristic squad of group we person operating and leasing those buildings that gives maine nan top assurance going guardant into 2023.

Thanks truthful much, everyone, and I'm going to move it complete to Jay.

Jay Jiang

Thank you, Gord. Hi, everybody. Happy Friday. 2022 was surely an absorbing year. As you know, we typically for illustration to supply our soul forecast and commentary connected our February calls. Last twelvemonth astatine this time, we were really looking guardant to nan different broadside of nan pandemic truthful we tin amended our occupancy pinch very precocious rents. Soon aft nan convention call, agency someway became an moreover much analyzable sector. While we person passed COVID, we're now facing an uncertain economical environment, persistent inflation, precocious liking rates and deficiency of clarity complete nan return to activity policies by tenants navigating akin economical challenges arsenic us. Despite each of that, we deliberation nan business held up very good this twelvemonth and delivered unchangeable results. And we are each besides very good positioned to amended agelong word income, value and value.

On nan quarter, we reported $0.37 per portion of FFO and comparative properties NOI of positive 0.1%. We are happy to spot that this was a first 4th since nan pandemic that we person reported affirmative CP NOI. Quarter-over-quarter adjusted for nan waste of 720 Bay, we improved our successful spot occupancy by 20 ground points and arsenic Gord has mentioned successful his remarks, we are seeing bully signs of touring velocity early this year. We are besides finishing up building connected afloat committed unit and edifice space. We are optimistic that this will thrust momentum connected nan leasing for nan agency constituent shortly. For 2023, our soul forecast calls for FFO of betwixt a $1.40 and $1.45. We are projecting debased azygous digit affirmative CP NOI from nan income portfolio based connected precocious 80s successful spot occupancy successful downtown Toronto and debased 80s occupancy successful nan different markets by nan extremity of 2023.

We besides forecast flimsy ostentation successful G&A and mid-90s FFO per portion from our Dream Industrial Investment based connected nan guidance their guidance squad provided connected Wednesday's convention call. Excluding onetime termination fees, our 2022 FFO will person been astir a $1.50.

The estimated alteration successful FFO comparative to 2022 successful our existent forecast is chiefly attributed to higher year-over-year liking expense. For context, we started 2022 pinch each invariable complaint of 2.3%, which has accrued to 6.6 by nan extremity of nan year, and our owe refinancings for 7 to 10 years successful 2023 is expected to beryllium successful nan precocious fives. We estimate that nan summation successful liking disbursal will beryllium astir $5 cardinal aliases $0.10 per unit. We are already successful precocious negotiations for galore of our mortgages owed successful 2023 and are assured that we will execute reasonable position connected nan refinancing. We intend to support leverage successful nan debased to mid-40s pinch ample liquidity to negociate operations and superior programs complete nan adjacent fewer years.

By 2024, we intend to trim debt-to-EBITDA to beneath 10 times. Our nett plus worth per portion for Q4 was $31.36, based connected a stabilized income headdress complaint of 5.1 for downtown Toronto and 7.6 for different markets, which is accordant successful nan headdress complaint surveys movements from appraisers and brokerage reports. This implies $600 a quadrate ft successful downtown Toronto and $225 a quadrate ft successful different markets, which we consciousness very comfortable with. We took 5 properties aliases 25% of nan properties by adjacent worth to 3rd statement appraisers successful nan 4th quarter. In summation performed elaborate valuation study connected nan remaining assets accordant pinch nan methodologies utilized successful nan appraisal process based connected observable marketplace inputs. 720 Bay was a unsocial plus because we closed nan waste connected January 30. So nan valuation deferred nan waste value of $135 cardinal and we admit nan summation of $20 cardinal against a erstwhile carrying value. We would for illustration to mention that nan IFRS valuation workout is designed to seizure a reasonable adjacent worth estimate successful accordance pinch accounting standards done nan lens of mean marketplace participant. We judge that nan buildings successful our portfolio are very unsocial and person important embedded values and replacement uses because of their locations aliases attributes. The premier illustration is our Bay Street collection, which is truthful unsocial because it is incredibly difficult to bargain specified well-located onshore to build mini practice buildings arsenic a replacement costs would beryllium astronomical. We person invested important superior connected some nan interior and exterior to elevate nan modular to best-in-class luxury boutique offerings for smaller tenants who want a Bay Street reside pinch a very precocious extremity moving space.

We person leased up nan unit spaces pinch worldclass restaurants and judge that nan area will go a awesome destination for luncheon and aft activity events. The operation of location, size and nan superior we person invested creates a very precocious obstruction introduction against comparable caller supply. Another illustration is 720 Bay, which Michael addressed successful his opening remarks. This was antecedently weighted arsenic an agency income property, but has proven to connection higher and amended usage to occupiers successful nan health, subject and acquisition district. The transaction proves retired nan liquidity and nan worth successful nan much challenging finance marketplace otherwise. But we judge we person different assets specified arsenic 55 Bay, 250 Dundas and 438 University that besides stock akin charismatic attributes to nan increasing healthcare and acquisition industry.

Across our portfolio, we person identified astir 3.5 cardinal quadrate feet of incremental residential density crossed 3 sites, which will use importantly from affirmative migration and organization trends successful Toronto. Over time, we deliberation location are different opportunities crossed our portfolio to research incremental residential vulnerability for our REIT arsenic well. Lastly, our 26.6 cardinal Dream Industrial units are presently worthy $450 cardinal connected carrying worth of $400 cardinal astatine trading value, which approximates half of nan marketplace headdress of Dream Office depending connected nan metric used. We stay optimistic complete nan fundamentals of nan business sector, and Dream Industrial is very good positioned to proceed outperformance. As liquid securities, they besides supply Dream Office pinch a awesome investment, bully separator connected nan line, charismatic output and elastic liquidity connected demand. Collectively, we deliberation our REIT offers diligent investors a very compelling opportunity to put and ain a postulation of difficult to switch assets that will turn successful worth complete clip done diversified means.

So convey you for your liking and we look guardant to reporting our results complete nan people of 2023. Now I'll move nan telephone backmost to Michael.

Michael Cooper

Thanks, Gord. Thanks, Jay. Now we'd beryllium happy to reply your questions.

Question-and-Answer Session

Operator

[Operator Instructions]

We person our first mobility from Lauren Kalmar pinch Desjardins.

Unidentified Analyst

Hey. Jay, possibly conscionable 1 speedy housekeeping method question. On nan FFO guidance that you gave, does that exclude DIR?

Jay Jiang

What do you mean by excluding DIR? The FFO guidance includes each nan components, Dir, G&A and each nan assumptions I outlined are successful nan scope of a $1.40 to $1.45.

Unidentified Analyst

Okay, perfect. Thank you. And past you guys intelligibly person immoderate bully visibility connected each these restaurants group to travel connected stream. Can you possibly supply immoderate colour connected benignant of nan cadence of really they're going to travel connected watercourse successful position of timing?

Gordon Wadley

Yes, nary problem. It’s Gord speaking. We person 1 of nan restaurants, there's still much accusation to travel and we want to beryllium respectful to nan announcements by our partners, but 1 of them we're expecting to travel connected conscionable astatine nan opening of nan summer, nan different 1 is looking towards nan extremity of nan year. We person different one. So 2 successful nan summer, 1 towards nan extremity of nan year, and different 1 arsenic early arsenic May.

Unidentified Analyst

Okay, perfect. That's very helpful. And past nan Bay Street collection. You guys are done, obviously, occupancy is still good beneath wherever it was pre pandemic, though granted, they're acold from nan only buildings. What's nan benignant of outlook for nan leasing connected those assets?

Gordon Wadley

Good question. It’s actually, Jay mentioned that tours are up dramatically this quarter, and a mates of our buildings wherever immoderate of nan residual activity was taken a small spot longer. We've had a number of tours. One of our buildings, 80 Richmond, conscionable arsenic an example. We had a fewer vacant floors there. We're trading insubstantial connected 70% of immoderate of that vacancy correct now, and we removed nan scaffolding conscionable aft we sewage backmost from holidays, truthful we consciousness beautiful bully astir it. 330 Bay arsenic well, too. There was immoderate residual vacancy there. A batch of it was driven by construction. But pinch nan announcement of Nelos, pinch nan reef destruction done connected nan building arsenic well, we've seen a immense uptick successful tours, and nan feedback conscionable connected nan communal areas, particularly from prospects, has been really positive. So we consciousness bully astir nan absorption and nan guidance we're fixed for nan equilibrium of nan year.

Unidentified Analyst

Okay. I saw nan lobby. They look great. And past possibly conscionable past speedy 1 for me. Any known non renewals successful nan portfolio of significance?

Gordon Wadley

No. We will denote adjacent quarter, but we were capable to beryllium successful a beautiful favorable position pinch our largest expiry. The tenant did springiness backmost a small spot of space. We were capable to return nan abstraction that they gave back, do a agelong word deal, which pinch a awesome US nationalist bank, and past nan tenant that was expiring renewed longer word connected nan equilibrium of nan space. So our biggest expiry for nan year, we've been capable to address.

Operator

Thank you. We person our adjacent mobility from Sairam Srinivas pinch Cormark.

Sairam Srinivas

Thank you, operator. Good morning, guys. And congrats connected a bully quarter. Just looking astatine this astir apt taking a agelong clip of questioning successful position of each these leases typical and basal coming up connected nan Bay Street collection, erstwhile you do each these stores and erstwhile group are looking astatine these properties, what's nan floor plan of these prospective tenants complete there? And if they were to benignant of, let's say, look astatine replacement options wrong nan downtown core, really would they beryllium comping nan postulation with?

Gordon Wadley

That's a really awesome question. So nan use for america connected Bay Street Collection is we person mini mean size level plates and we do come, we don't straight compete pinch nan AAA caller build towers that person large 30,000, 25,000, 40,000 quadrate ft level plates. Our level spot sizes from conscionable complete 5000 quadrate feet. So nan type of tenants that we're seeing, particularly this 4th are financial services firms, rule firms and master services firms. And nan feedback that we're getting from group is they for illustration nan thought of having a Bay Street address, which is astir apt Toronto aliases Canada's astir precocious floor plan reside aliases street, having a Bay Street reside and having their ain level successful these recently renovated buildings truthful they're not straight comping it connected an apples-to-apples basis.

In position of rent, we still compete connected a gross ground little than those AAA towers. But group that want to person a Bay Street address, group that want to person their ain floor, we're astir apt nan astir viable action for them. And to beryllium honest, it's mostly been financial services firms and master services firms that person been coming done and looking astatine our assets.

Sairam Srinivas

Thanks Gordon. I'm astir apt going to sound a spot speculative erstwhile I opportunity this, but are you besides seeing tenants, larger tenants would alternatively successful pre pandemic days, spell for these larger level plates? Are you seeing them benignant of downsize and travel for, let's opportunity a smaller Bay Street reside correct now and astir apt unfastened a outer agency location successful nan suburbs to benignant of assistance group getting backmost to nan office? Have you seen immoderate trends for illustration that coming in?

Gordon Wadley

Not a ton. But we did person 1 illustration to adjacent retired nan 4th wherever we had 1 tenant that was successful a ample organization AAA tower. I deliberation they were successful astir 11,000 quadrate feet there. They felt beautiful small, their occupancy needs were compressed. So they did a afloat level woody pinch america astatine 80 Richmond for conscionable complete 5,000 quadrate feet. But location hasn't been that galore much information points successful position of group really giving backmost that overmuch space, to beryllium honest, successful my experience. I deliberation for nan astir portion that's taken spot complete nan people of nan past 24 months. I don't deliberation we're going to make excessively overmuch more.

Sairam Srinivas

Yes, that astir apt makes sense. Thanks Gord. Probably conscionable switching connected to disposition connected 720 Bay, Michael, Jay, tin you guys remark connected what is nan floor plan of nan purchaser look like? Was it much organization finance benignant of purchaser aliases much personification related purchase?

Michael Cooper

No, it was a wellness subject business.

Sairam Srinivas

All right. Okay. And successful position of nan prospects of further, are location immoderate prospects for immoderate early dispositions successful nan portfolio?

Michael Cooper

We sold 140 buildings betwixt 2016 and 2019. 720 Bay was an outlier. There are a fewer non-core buildings that we've been unfastened to trading for years, and I deliberation we sold 1 precocious successful Saskatoon. But mostly we're beautiful happy pinch our portfolio and nan measurement it's constructed, truthful we're not that anxious to beryllium trading assets.

Sairam Srinivas

That makes sense, Michael. And astir apt conscionable reasoning astir nan residential density you guys mentioned connected nan existent portfolio, is that thing you would look to create wrong nan REIT aliases wrong nan broader aliases would it beryllium for illustration wrong nan broader Dream Group arsenic such?

Michael Cooper

I deliberation that immoderate information of it gets developed wrong nan Dream Group will beryllium successful Dream Office, but we are looking astatine bringing successful partners perchance to 250 Dundas truthful that we could negociate to ain our stock without leveraging up.

Operator

Our adjacent mobility comes from Mark Rothschild pinch Canaccord.

Mark Rothschild

Thanks and bully morning, everyone. Michael, you went done a bunch of different items of worth that successful immoderate cases, aliases successful astir cases, don't really make income now, and astir apt don't get overmuch worth from investors aliases that aren't Dream related aliases Dream [inaudible]. To what grade does that matter successful nan adjacent term? Do you see possibly looking to monetize immoderate of that now, aliases do you conscionable deliberation that there's a batch of worth location that complete clip will beryllium surfaced and you conscionable person to wait?

Michael Cooper

I don't know. We person a agelong word position astatine Dream Office, which we ever have. With respect to 2200 Eglinton, we're successful nan process of creating nan expertise to usage that density. And I mentioned that we are moving pinch different developer to create nan first 4th of it. Of each those things, I deliberation we want to maximize nan worth connected our ain equilibrium sheet. I don't deliberation we're looking to like; I deliberation it would beryllium nan 30 Adelaide Street, East Street. I deliberation we want to person a vibrant portfolio and we're going to stick, I think, pinch what we've been doing. I mean, I deliberation nan strategy is possibly bringing different developers do a small spot little than we would person done 3 years agone ourselves, aliases bring successful portion done different developers. And past pinch nan rate that we've raised, I deliberation we're going to beryllium buying backmost shares a small spot much aggressively than we person recently. But I deliberation we're doing what we're going to do.

Mark Rothschild

Okay, great. And past possibly conscionable 1 mobility for Gord. The rental rates that you've sewage seemed to person held them beautiful good while vacancy has increased. To what grade is this flowing done into nett effective rents? And really is that changing? And is it conscionable nan look rates they're holding? Or is it really conscionable occupancy slipping, but rents are staying firm?

Gordon Wadley

That's a bully question, Mark. So rents, for illustration I mentioned, year-over-year, were up astir 9% connected a nett rent basis. NERs are flat, they're down actually, astir apt astir 1.5% versus what we had successful nan budget. And nan biggest driver for that has conscionable been costs. So worldly cost, betterment costs. And nan different point that's caught nan full marketplace is agent commissions. The costs of salary brokers person gone up rather importantly arsenic an manufacture modular complete nan people of nan past twelvemonth arsenic good too. Occupancy, for nan astir part, lagged a small bit. As I mentioned before, successful completing nan work, it took a small spot longer successful position of getting immoderate of nan scaffolding and things down. But nan deals that we're successful progressive negotiations pinch correct now, nan complete 150,000 feet, nan rents are search amended than nan 9%, nan 8.5% summation successful nett rents we had year-over-year connected a nett basis. And NERs, and to beryllium honorable pinch you, Mark and NERs are looking a small spot better, too, conscionable because we're seeing a spot amended pricing connected finishing trades.

Operator

We person our adjacent mobility from Mario Saric pinch Scotiabank.

Mario Saric

Hi. Good morning, everyone. Want to get backmost to nan residential density, nan 3.5 cardinal quadrate feet that was highlighted crossed 3 sites, does that see 2200 Eglington, aliases is that supra and beyond that?

Michael Cooper

No, that includes 2200, sorry Jay.

Jay Jiang

Yes. Michael did item 74 Victoria and different ideas successful his remarks. So I said that nan 3.5 is based connected nan 3 identified sites, which are successful our disclosures, but there's a imaginable upside successful nan future.

Mario Saric

Okay. In position of 2200 Eglington, nan worth creation is beautiful substantial. The numbers look to make consciousness to us, anyways successful position of nan upside, really should we deliberation astir nan nickname of that $165 cardinal aliases truthful that you highlighted arsenic worth creation complete time? What are nan cardinal events that you spot that filtering into your book worth complete time?

Jay Jiang

Sure, I'll make an effort astatine that. So, arsenic of Q4, our carrying worth really stayed beautiful flat, and there's a mates of reasons for that. We've person to spell done a beautiful thorough process pinch nan information process. And erstwhile this was primitively appraised by nan lenders, it did see nan anticipation it would beryllium rezoned, though evidently it's de-risk. But we're still moving done a mates of subdivision plans which should beryllium done by midyear, and that'll springiness america amended clarity connected nan various phases truthful we could activity retired nan pro forma. And yet nan worth is derived from nan expected profits of these developments complete nan phases. The different point we did was erstwhile we did nan valuation successful December, we had an independent agent do nan appraisal of nan tract based connected what they could spot arsenic monetization value.

And we fell wrong nan scope arsenic well. So moreover though we felt it was a blimpish worth based connected observable data, that was nan carrying worth booked. Now, Michael mentioned that he was talking to various developers connected opportunities. $70 nett was mentioned. When those conversations crystallized, immoderate of that worth will decidedly beryllium successful our carrying worth complete time, depending connected benignant of really these projects are laid out. So I do expect that complete 2023 you'll astir apt admit worth successful betwixt nan quarters and astir apt spell up successful stages successful betwixt nan 110 and nan 200. Hope that helps.

Mario Saric

Okay. And past conscionable astir apt inquire this question, either 1 aliases 2 convention calls agone for illustration really should we deliberation astir nan 4 phases there, nan timing. Can you conscionable laic retired really we should expect to spot that to germinate complete nan adjacent whether it's 4 years, 8 years, 10 years? How should we deliberation astir what happen?

Jay Jiang

No, it's not for illustration that. What I would opportunity is each input for rental has been changing, and each authorities is trying to woody pinch affordable lodging their ain measurement and promote rental their ain way. So that needs to settee down. I deliberation we're looking astatine starting nan first shape successful 2024, and consequent phases should commencement beautiful quickly thereafter. But we don't person capable information. I mean, I deliberation a batch of nan manufacture is uncertain astir what nan inputs are, but I deliberation it'll go overmuch clearer complete nan adjacent 16 to 18 months.

Mario Saric

Got it. Okay. And past conscionable coming backmost to different taxable during nan telephone successful your prepared remarks, nan Discovery District and 720 being 25% of your wide portfolio there. So it appears that an alternate usage for buildings successful that marketplace seems to person a higher worth than conscionable consecutive accepted office. Is that thing that you scheme to do yourself extracurricular of nan 720 Bay, which was a different approach? Is that thing you scheme to do yourself? Or are you benignant of highlighting that nan marketplace is location for immoderate beautiful aggressively priced further dispositions?

Michael Cooper

We're not looking astatine trading anything. At 250 Dundas, there's opportunities related to nan hospitals, besides schools for really we redevelop that. At 438 University, there's rather a batch of agelong leases, and aforesaid point astatine 655 Bay. I deliberation nan constituent we're trying to make is they're not commodity buildings. And if you're looking astatine what nan worth of a building is, those ones look to person a different value. But, I mean, if personification offered you what your location is worth, you would beryllium stupid to waste it because each you person to do is get different location aliases something. So, I mean, it's benignant of tiring, but no, we are not looking to dispose of each our assets and beryllium nan 30 Adelaide Street.

Mario Saric

Okay. And past possibly 1 past housekeeping mobility for Jay. The quarter-over-quarter alteration successful nan headdress rate, really overmuch of that would person been attributable to nan reclassification of 720 Bay?

Jay Jiang

So we backmost it retired actually, and past truthful 720 Bay is carved retired astatine 135, and past nan remaining portfolio successful downtown Toronto, I think, went up astir 40 ground points. And I deliberation connected nan carrying value, I deliberation you tin connote it back. If we had a gain, astir $20 million, you tin astir apt deduce nan headdress complaint that 720 Bay was held at.

Operator

Our adjacent mobility is from Jake Stevleti pinch CIBC Capital Markets.

Unidentified Analyst

Good morning. You mentioned nan repositioning of immoderate of your assets, specifically successful different markets. Is location immoderate timeline connected nan that ? And I cognize you mentioned you're not focusing connected dispositions, but person you been capable to gauge what nan appetite is for illustration successful nan backstage market?

Gordon Wadley

So successful non-core markets is what you're asking, Jake?

Unidentified Analyst

Yes.

Gordon Wadley

I mean, we sold Princeton Tower towards nan extremity of past twelvemonth to a backstage purchaser and location was immoderate liking connected immoderate of our different assets. I deliberation successful Calgary erstwhile we were looking astatine our plus strategy, we are successful discussions each nan clip looking astatine what nan highest and champion usage is. We've sewage immoderate really bully located assets successful Calgary truthful we're looking astatine different repositioning strategies location correct now and I deliberation we're going to person immoderate much accusation connected that 1 going complete nan people of nan adjacent 2 quarters.

Jay Jiang

Yes, conscionable for. Example, Kensington House successful Calgary, it is connected nan Bold River. It will beryllium a awesome development, residential tract down nan road, Dream Head agency successful Calgary is location correct now. 606 is rather absorbing too. It's sewage attached Park aid. It's crossed from City Hall. We're looking astatine ideas wherever we research everything. There's been a batch of sorts of activity connected nan conversion broadside successful Calgary recently, truthful we're exploring that successful Kansas City correct now we do person a lease pinch a slope but agelong word is really successful a comparatively bully residential territory adjacent to Acasco, truthful we're being beautiful proactive connected plus management. It's still early days, but we're turning complete each nan rocks connected each azygous building we can.

Unidentified Analyst

Great, convey you. And then, past question. I cognize this is touched connected already a small spot but truthful tenant betterment has accrued rather a bit. I understand that nan year-over-year comparison isn't rather arsenic useful fixed nan authorities renewals successful 2021, but could you supply a spot of colour connected what you expect those to look for illustration done 2023?

Gordon Wadley

Yes, that's a really bully mobility and I'm gladsome you're pulling retired nan authorities deals because it's, there's a quality successful what we're seeing successful nan backstage and nan nationalist assemblage connected competitory deals. So we're seeing a batch of tenants that are trying to push superior costs to us. So if typically we would fund $50 a quadrate ft aliases $60 a quadrate ft successful landlord's activity aliases tenant betterment allowances, we brought that up astir 20% to 25%. Just looking conscionable to protect ourselves connected scope creep and costs variables. We're getting a batch of group that are looking astatine getting immoderate different word free rent aliases immoderate successful word free rent that, depending connected really you look astatine it, impacts nan NERs arsenic well, too. And a batch of that is superior preservation conscionable connected nan portion of nan companies truthful they tin build a spot of a warfare chest. I deliberation everybody we talk to and everybody I circuit is speedy to opportunity they're still not 100% convinced what nan adjacent 8 to 12 months are going to look like.

So everybody's being really prudent pinch their ain capital. And to beryllium honorable pinch you, Jake, everybody has a different costs of capital. We person a different costs of superior than immoderate tenants do, truthful it conscionable becomes an workout successful superior preservation and for bully tenants, I'd beryllium correct beside Jay and correct beside Michael, so. On large tenants and deals of scale, we're ever talking astir making judge we've sewage bully covenants and awesome deposits to backstop immoderate of nan risks of putting much money into nan deals. But we're seeing it, and I fishy this is simply a inclination that we're astir apt going to spot towards till nan extremity of 2023 arsenic well.

Operator

Our adjacent mobility from Matt Kornack pinch National Bank Financial.

Matt Kornack

Hey guys. Just we've sewage astir 2 aliases 3 years near connected a beautiful fulsome improvement rhythm successful nan metropolis of Toronto pinch regards to office. But pinch what you're doing connected 720 Bay and immoderate of nan proposals from your peers who ain offices wherever nan caller developments will person residential and benignant of 50% of nan existing agency abstraction connected nan site. Do you foresee aft this proviso pipeline that we whitethorn really spot a simplification successful nan magnitude of agency abstraction successful nan city?

Michael Cooper

Matt, that's a awesome question. I deliberation that what we're going to spot is simply a slowing up of caller improvement and I deliberation we're going to spot obsolete buildings having different uses. So, arsenic an example, 720 Bay will not beryllium successful nan agency marketplace pinch nan caller owner, truthful 250,000 quadrate feet will beryllium gone. I deliberation we're going to spot continued request for immoderate caller buildings, bully request for absorbing buildings for illustration we own, and much and much buildings will beryllium obsolete and will beryllium turned into thing else. So 10 years from now, we whitethorn person little agency buildings, but still person immoderate caller ones.

Matt Kornack

Fair enough. And you mentioned pinch regards to nan metropolis and zoning that immoderate require replacement. Is that modular crossed nan committee if you person agency assets nan metropolis would for illustration to person immoderate replacement of office, aliases tin you build axenic residential successful nan core?

Michael Cooper

Currently, you request to switch existing office. However, I deliberation that location whitethorn beryllium an openness to considering changing that, arsenic nan lodging needs are very, very precocious and location is nary request for aged agency buildings. So that's what we're moving on. We'll spot really it goes, but I expect that will beryllium akin what happened pinch benignant of nan downtown business buildings that became disposable to usage successful different ways.

Matt Kornack

Okay, adjacent enough. And then, Jay, conscionable a speedy travel up. I deliberation Mario asked nan mobility pinch regards to IFRS versus Michael's $200 cardinal connected 2200 Eglinton. Did I perceive you correct that you had $110 cardinal of incremental worth for density successful that and past possibly much broadly to different projects. Is that nan only 1 wherever you're benignant of carrying density worth successful nan existing valuation and nan remainder are treated arsenic benignant of axenic agency assets? Or really should we deliberation astir your IFRS connected that front?

Jay Jiang

Yes, to explain nan $110 cardinal was a carrying value, and if nan worth is $200 million, I conjecture there's $90 cardinal would beryllium nan incremental. We're going to person a batch much accusation complete nan adjacent mates of quarters and ultimately, we're astir apt going to package each of that up and bring it to outer appraiser again and to opportunity that, hey, this is what we could do pinch nan first 2 phases.

For example, this is nan tract density and nan subdivision plan. And they will usage that accusation now that they person much clarity to supply nan worth either Q1or Q2. The different tract that has embedded density value, 250 Dundas because we person nan rezoning completed, we person appraisal for that arsenic well.

So that 1 is held astatine density value. We person financing to support that arsenic well. I deliberation everything other is weighted arsenic a accepted agency for now.

Operator

We person our adjacent mobility from Sam Damiani pinch TD Securities.

Sam Damiani

Thanks and bully morning, everyone. Just a remark connected tours being up big, I deliberation it is since nan opening of nan twelvemonth what would you property benignant of nan main logic for that spike successful entering activity successful nan past period aliases two?

Gordon Wadley

Sam, I deliberation it's mostly attributed to nan truth that we've sewage nan scaffolding down and nan construction, we've been trading and hyping up Bay Street Collection nan amended portion of nan past 2 years. Now that a batch of it is down, it's vanished and it's presentable. A batch of nan pent-up tours, group are seeing it, they're stepping it, and our astir influx of tours person been successful that submarket aliases successful that circumstantial neighborhood. So we're starting to spot a batch much of that. And conscionable carrying disconnected to nan extremity of past year, we saw arsenic an manufacture a existent pickup successful tour. So I deliberation group are starting to fig out, they're starting to get group backmost to nan office, they're starting to fig retired what their agelong word accommodation plans are. And there's moreover speaking to my peers astatine different companies, they're each seeing nan aforesaid thing, conscionable much group stepping nan street. And I deliberation for us, wherever we've seen nan biggest uptick successful tours is because we vanished nan activity and they're now overmuch much presentable.

Sam Damiani

Perfect. That's helpful. And I'm not judge if it was your comment, Gord aliases Jay's, but it was mentioned that there's precocious obstruction to introduction aliases you've created a precocious obstruction to introduction connected your Bay Street collection. I was conscionable wondered if you could grow connected that a small spot successful position of what precisely it meant.

Jay Jiang

Yes, sure. So Sam, if you deliberation astir a large agency building, you tin bargain a portion of land, you person a improvement program, and past you person difficult and soft cost. So let's opportunity hypothetically it becomes $1,000 a quadrate foot. That is simply a pro forma for a caller development. With Bay Street is truthful unsocial because a, nan location centralized. So it's very difficult to get onshore successful that area. Second, I deliberation our mean building size location is 10 aliases 12 storeys aliases sometimes moreover lower. So you wouldn't typically bargain a portion of onshore to build a mini building because nan improvement pro forma is either not economical, different you're near pinch a very precocious value per quadrate foot. So that's nan 2nd one. Third, fixed nan beingness attributes of these practice buildings and nan superior that we person put successful to make it exceptional connected nan wrong and nan outside, and we're attracting a unsocial people of tenants.

And nan taxable has ever been that if you're a precocious gross generating patient pinch less labor but precocious gross per employee, you want your ain Bay Street address, you want your ain elevator Bay and your ain marque and your ain level successful that location, you don't really person a batch of different options. Lastly, you sewage nan restaurants and nan unit eminence. And erstwhile that's each done, you person an full it's almost for illustration a vibrant organization that's difficult to replicate elsewhere. So I deliberation nan operation of those 4 factors create a beautiful precocious moat.

Sam Damiani

And like, what different landlord successful nan downtown marketplace would beryllium -- would you spot arsenic your closest competitor connected nan Bay Street collection?

Michael Cooper

Hallmark is akin successful immoderate ways, but they're not successful nan core. And there's a mates of individuals for illustration nan Flatiron Building and worldly for illustration that. So location isn't really 1 that you tin participate successful nan nationalist market. But what I would opportunity to adhd to what Jay was saying is nan worth of these smaller typical buildings is very high. And we've seen that for a long, agelong time. That a 60,000 quadrate ft building that is typical trades astatine multiples of what commodity building trades for.

Sam Damiani

That's very helpful. And nan past question, conscionable to explain a comment, Gord, I deliberation you made successful your opening remarks, talking about, again, nan Bay Street postulation you mentioned there's 25 deals astatine $38 a ft connected average. What was nan GLA connected those deals successful total? And did that $38 mean see immoderate unit space?

Gordon Wadley

Yes, it didn't see nan unit space, Sam. On average, astir apt nan gross absorption connected those 25 deals, conscionable astir apt astir about 75,000 quadrate feet passim it. And they've been great. Like immoderate renewals, we did one, and I'll only usage it if it gets blended in, but we did 1 nett caller woody astatine 80 Richmond, wherever nan rents were approaching northbound of $45 a quadrate ft conscionable to start, and a beautiful beardown NER. So we're starting to spot renewals, we're doing good on. But nan nett caller deals, we haven't seen immoderate insubstantial travel successful little than $35 a quadrate ft astatine nan start, and we've been capable to push rents up to average, astatine slightest $38 a foot. Just for your team, Sam, location are immoderate renewals blended successful that 25 woody number.

Operator

Our adjacent mobility is from Tommy Burr pinch RBC Capital Markets.

Unidentified Analyst

Thanks. Good morning. Just connected 2200 Eglington, coming backmost to that, you mentioned that you're successful talks pinch a developer. Just what's your consciousness of really overmuch of that you mightiness look to really monetize this year? And past I'm conscionable funny arsenic well, really galore parties person you been successful talks pinch aliases that person possibly expressed liking successful nan tract for nan residential?

Michael Cooper

I deliberation that we will monetize nary of it this year, if we're going to monetize immoderate of my behalf of nan first phase. We person spoken to a few, very few, but these are group we would partner with, and we beautiful overmuch cognize who we're comfortable moving with. So we want to create it a bunch of ourselves, and we're trying to create immoderate of it pinch others.

Unidentified Analyst

Got it. And past conscionable possibly conscionable 1 other mobility connected that. Is location a operation that you person successful mind yet for nan condo versus rental? Or is that benignant of each portion of nan 4 shape planning?

Michael Cooper

Everything is changing. Our first intent was to create astatine each arsenic apartments, but it doesn't make a batch of consciousness correct now. Hopefully it will arsenic things settee down. So we're contented to bring successful a partner for half of nan first shape arsenic condos.

Unidentified Analyst

Okay. And past conscionable a mates of housekeeping items, maybe. Jay, connected nan subordinate 42, nan 145 afloat guidance. Are buybacks factored into that, aliases could location beryllium immoderate upside to that range?

Jay Jiang

Yes, now, our soul forecast, we do facet successful buybacks. So we anticipated, like, everybody's going to person nan superior allocation sensitivity. So erstwhile we ran nan numbers, hence, we gave a scope pinch aliases without nan buybacks, fixed that there's only 2 cardinal shares near to bargain back. And it’s each taxable to pricing, of people it would apt enactment wrong nan scope anyway. So correct now, if you do immoderate buybacks aliases accretion truthful you'll astir apt beryllium connected nan higher extremity of nan range.

Unidentified Analyst

Okay. And past conscionable lastly, I deliberation I cognize nan reply to this, but conscionable connected nan precocious 80% occupancy guidance for nan year, I'm assuming that was connected a committed basis.

Jay Jiang

In place.

Unidentified Analyst

Okay. In place. Sorry? In spot precocious 80% by nan extremity of nan year.

Jay Jiang

In downtown Toronto, debased 80s successful different markets. So correct now there's a spread, arsenic we commented connected anterior calls. A batch of it is conscionable nan timing of these ample edifice deals. They're successful their fixture and furnishing period. And truthful we'll spot each that travel online astir apt towards nan 2nd half of nan year, and past there'll beryllium immoderate leasing successful summation to that. So hopefully a batch of nan buildings are filled by nan extremity of nan Q4.

Thank you. And we person nary further questions successful queue. I will now move nan telephone backmost complete to Mr. Cooper for closing remarks.

Michael Cooper

Thank you very much. I admit everybody spending clip pinch america today. Jay, Gord and I are disposable immoderate clip to reply further questions. Once again, convey you for your support and we look guardant to speaking to you adjacent 4th and possibly successful between. All nan best. Bye-bye.

Operator

Thank you. This concludes today's conference. Thank you for participating. You whitethorn now disconnect.