Obviously with cars on the road eclipsing 12 years and still not able to get a car, because the chips shortage, the auto parts operators AutoZone, O’Reilly, Napa want to continue to grow. The tire and service operators in this country, the National Tire and Batteries, Bridgestone, Firestone, Goodyear want to continue to grow. The challenge for these retailers that they historically don’t have a self development platform and/or don’t have the stomach to keep them on balance sheet and then offload them via sale leaseback or permanently keep them on balance sheet as the merchant builder business is that. And so, our conversations with these retailers revolve around which three of our external growth capabilities, acquisition, development and Partner Capital Solutions could potentially be a solution for them.
And so, these are conversations that are ongoing. And they’re producing some interesting dialogue. We’ll see if any of them strike. By the way, you can add to that with Sam’s Club for the first time in, what, 12 years, announced 30 net new stores. And so, you see that these discount oriented retailer or these value oriented retailers want to grow regardless of the storm clouds on the horizon. But frankly, the ability to grow is their challenge.
Operator: Our next question comes from RJ Milligan from Raymond James.
RJ Milligan: Joey, your comments that there’s plenty to buy, if you were willing to sort of hit the pricing expectations, but obviously being a little bit more prudent here. I’m just curious, what do you think has to happen for sellers to adjust those pricing expectations?
Joey Agree: It’s a great question. I think first of all, we see the sentiment swings and shifts daily with new data and the Fed speakers rambling on like Tony Romo during a football game. Nobody knows that this is going to be a soft landing, a hard landing, this economy is going to flow up there like the Chinese spy balloon for a while, we have no certainty to this market, still hopeful, inclusive of real estate sellers, that the Fed is going to cut rates at the end of this year. Maybe that got washed away yesterday. And so, I think the current status quo results in a bid-ask spread. Now, we have more data this morning with consumer sentiment or consumer spending. And so, the challenge here is that nobody has visibility into how this economy is going to evolve here.
And hence unless you are in middle market or a private equity sponsored retail or who needs capital today via sale leaseback where banks have pulled back and lenders have pulled back on LTVs, rates are obviously extremely elevated, you can find a lender, or last resort in terms of sale leaseback who will be there as a secured creditor with your real estate to help you with your growth. Now, the challenge on the third-party market specifically is that there’s still too much hope out there. And until that clears up, I think we’re still going to have a bid-ask spread. Now, what we’re doing is scouring the market through all of our contacts, all of our different distribution groups, all of our different stakeholders and partners out there and looking for the capitulation.
And we’re finding it. The question is, how much will we find as the economy evolves? And that I just don’t have any idea because I don’t know how the economy’s going to evolve?
RJ Milligan: That makes sense. And I guess a question for Peter. I’m just curious what you’re seeing on the debt market side? Obviously, the market’s opened up a little bit for the REITs here. And I’m just curious, what are you hearing in terms of banks’ appetite for debt and what pricing might look like to that?
