Todd Thomas: Hi, thanks. Good morning. Hey, John, I appreciate the detail around 2024. Question, though, as we think about that $0.30 to $0.34, the quarterly run rate that you mentioned and the cadence of that throughout the year relative to $0.27 this quarter, should we expect the early part of the year to be below that $0.30 to $0.34 range and then the latter part of ’24 at or above the higher end of the range as more SNO rank commences? Or your comments meant to suggest that you think you should be in that range throughout the entire year?
John Gottfried: Yeah. So, Todd, I guess a couple of thoughts. One, I’ll start with, we are not formally giving guidance, we’re certainly not formally giving quarterly guidance. But what I would say, and I think right now, all else being equal, the $1.28 for the year is the one that measuring a bunch of different variables, we think we land at. And I would say that it is probably a fair assumption as the signed but not open pool does not all start on January 1, and our core is the biggest driver. There will be growth throughout the year on those leases that are already executed. But I think, again, without wanting to formally do it, I think picking the midpoint for an annualized number is as good of an estimate as we have right now.
Todd Thomas: Okay. And then I’m not sure if I missed this in those comments as well. But so the 4Q implied guidance for this year, it’s about $0.29, I believe, at the midpoint. Are there additional ACI stock sales embedded in the revised guidance for 4Q? And then can you just clarify your comments around the net promote income in 2024, whether that $0.01 to $0.02 is what you’re anticipating each quarter or if that’s incremental to what you achieved in ’24?
John Gottfried: Yeah. So I’ll start with that one first. The $0.01 to $0.02 is incremental of the $0.27. And again, I would just look to — we’re in the $30 million range from our fund business, Todd, and we think that stays stable, whether it’s a combination of fees, promotes, et cetera. We think that remains — that remains very, very stable. In terms of promote, again, that’s tied to a number of factors, including our taxable income, but we will be within our initial guidance range that we put out for promote at the beginning of the year.
Todd Thomas: Okay. All right, that’s helpful. Thank you.
Operator: One moment for our next question. Our next question comes from Jeffrey Spector with BofA Securities. Your line is open.
Lizzy Doykan: Hi, good morning. This is Lizzy Doykan on for Jeff. Just within the expectation for at least 5% same-store NOI growth in ’24, should we assume a consistent level of contractual rent bump of 3% on street, possibly lower on suburban? And if you can’t speak to exact numbers, maybe if you could just speak to expectations around how that should change based on the demand environment?
John Gottfried: Yeah. So, Lizzy, I would say that the assumption, the 3% on the Street is absolutely still the norm. We do have some leases that AJ is able to get 4%, but I think it’s fair to use the 3% in suburban. The typical is 10% every five years. So it averages just slightly below the 2% range. But I would say that our contractual growth is consistent with what we’ve done in the past.
Lizzy Doykan: Okay. Great. And I just wanted to go back to Ken beginning comment around CapEx and leasing costs and keeping that under control for maintaining net effective rent growth. Just wondering if you could expand on that further and maybe give us a better idea of what the associated costs are for the $8 million in ABR from SNO and give us maybe a better idea of a real-time update on how those costs should be recognized when the rents come online, too.
John Gottfried: Yeah. So why don’t — I’ll take the piece of it, then I’ll have Ken talk through the trends, Lizzy. So I’d say, again, given the good chunk of that $8.3 million signed net open is from the Street. And as AJ mentioned, our payback is a year or less. That’s probably the way to think about that in terms of — I think your question was when do we recognize those? We will pay them once it sort of cost different periods of time. But generally, when around the tenant when they take occupancy is whether it’s the leasing commissions, we will pay those and then some of the upfront whether there’s any build-out cost that we do, we pay those in advance of them. But I would say, for the most part, the good portion of those — of that $8.3 million is Street, and we — the upfront costs are less than a year around.
So that’s the way you could do the math. And on Suburbia, AJ, do you want to talk to that in terms of the cost you’re seeing on suburbia, whether it’s going to depend on whether it’s in line space versus anchor, but I just want to give a quick update on the trends on the cost that you’re seeing on the suburban side?
AJ Levine: Yeah. So I mean the cost to put in a junior box have been elevated really for the last 24 months. So I’d say a typical junior box at this point is costing anywhere between $65 and $80 a foot to put in. And depending on where the rent is, that can be five to six years of payback. So it certainly is very pronounced sort of the shorter payback periods that we’re seeing on the street just given where the rents are.
Ken Bernstein: Let me end with some positive news in terms of all this. We are beginning to see some disinflation in terms of the actual costs to put in tenants in Suburbia. And while the cost to finance those build-outs has gone up with interest rates, when you look at the value per square foot, the price per foot or replacement cost, our retailers are recognizing staying or opening in these locations is critically important. So we’re able to drive rents. And I think that the suburban component, while expensive, will still be a profitable part of our business.
Lizzy Doykan: Great. Thank you.
Operator: One moment for our next question. Our next question comes from Paulina Rojas Schmidt with Green Street. Your line is open.
Paulina Rojas Schmidt: Good morning. My apologies if I missed this. But from a big picture perspective, when you’re thinking about tenant failure next year, what’s your best case scenario? And I want to have a very pretty big idea because some of your peers have been sharing that they are thinking about apology as an average year from a tenant sales perspective. And I wonder, given the scenario of uncertainty that we were facing, if you think that’s reasonable or not.
Ken Bernstein: Paulina, is your question on the credit side or the retaining, whether they’re on renewals?
Paulina Rojas Schmidt: The mix, I would say. So it could be a non-renewal or any type of OpEx, so both.
