Keith Kimmel: Robyn, it’s Keith. I would just say that, look, it’s been a tough four years there. So it’s hard to believe. But in March of this coming year, we’ll be in four years of sort of navigating the remote work and all the different types of things that happen with the technology environment there. Mostly, what I want to say is that we’re cautious about it. But, pointing back to the occupancy that I just had referred to, our portfolio being at 97.7% in our Bay Area portfolio rises to the point that gives me confidence that the demand continues to exist and be there. It will be really about when we can really recapture some of the rates that have been on the table for a period of time.
Robyn Luu: That’s helpful. And then, just one for Josh. And then, just touching on the Maryland acquisition. Given the price per door is 50,000 or thereabouts and the rents are a little bit higher than what is usual for the market, how are you underwriting affordability and I guess, your ability to rent growth over the near to medium term?
Josh Minix: You’re absolutely right. It is a higher-end property. That particular one has market-leading finishes in quality and attracts the top end of the renter base there. Affordability in the building is excellent with income to rent ratios of less than 20%, and we think that will be durable demand.
Operator: Your next question comes from the line of Michael Goldsmith from UBS.
Michael Goldsmith: The same-store revenue buildup for 2024 is really helpful. It seems like some of the components are probably more certain than others. So, can you provide a little bit more detail into your visibility and the increase in the average daily occupancy and bad debt improving next year? Thanks.
Paul Beldin: You bet, Mike. Thanks for the question. This is Paul. On the first point around our optimism around higher average daily occupancy in 2024 versus 2023, we provided a range where we expect to do maybe 10 to 20 bps better than in 2023. A portion of that is really just due to the noise that we had during the second quarter in Los Angeles on the eviction process as we evicted those residents that had been living in our communities but not paying rent. And so just the elimination of that reoccurring next year gives us 10 basis points. And then on the upper end of that range, on the 20 basis points, that’s really being driven by how we have operated this year versus 2022. So far year-to-date, we’re trailing our 2022 occupancy and part of that is due to L.A., but part of it is just due to the changes in markets.
And as we’re doing our budgets plan, we see the upside to do better than we did this year. And so that gets us to the high end of the range. On bad debt, we have done well this year in bad debt. Our year-to-date bad debt on a net basis is 80 basis points of revenue. If you exclude collections from prior periods, our bad debt is 120 basis points of revenue on a gross basis. But that’s still above where we’ve been on a pre-COVID basis, although we’re getting closer. In the third quarter, our bad debt on a gross basis was 80 bps, and 25 of that — of those basis points is just elevated due to eviction-related move-out costs and fees. So, if you pull that out, our bad debt expense on a gross basis, again, is about 55 bps. And so, if we do know better than what we did in the third quarter, you would get that improvement that we are outlining in the outlook for ‘24.
Michael Goldsmith: And then my second question is on the ability to sustain and control expenses that’s built into your expectations for next year, well controlled again in the third quarter here. I guess, just given some of the investments you’re making, is there continued ability to keep expenses moderate over the long term, or is this — I’m just trying to understand like how much more cost savings you can kind of drive and keep it controlled, or are we kind of getting to the end of that component? Thank you.
