We’ve had assets that are performed quite well. And we’ve been paid off because of that. And we’ve had other situations where there was sub-debt or other capital subordinate to us that as business plan was being achieved, sought a guess out. I guess the high level of commentary on office in Europe in general, is that office usage in Europe hasn’t gone through the fits and starts that we’ve seen in the U.S. with respect to getting people back to the office. People are back to the office in Europe. People are using office space. You have similar concerns in Europe to the U.S. vis-Ã -vis concerns over recession, not recession, though, I would say the concerns in Europe are a little bit more concentrated, i.e., it’s tied to for the most part, energy prices.
So I would say on the office side in Europe, we’ve stuck to major cities and have generally been quite pleased with the performance of the portfolio. On the retail side of things, the strategy in Europe has been more I’d say non-traditional retail and that we’ve done outlet center in Europe. And then, we’ve also done call it a bigger box concept. Both concepts which historically have proven to be much more recession resilient in terms of their performance given the price point at which the tenants are selling goods. I would say performance has been good, on a debt yield basis, I think given that it’s retail, we were able to strike some pretty attractive terms from our perspective. So as we look at rent levels versus our loan basis, we feel very comfortable from a debt yield or cap rate perspective, if you think about it, at that level.
But generally speaking, happy with the portfolio in Europe, as you’ve heard me say on prior calls, a little bit more selective with Europe today. A, because of where Europe’s gotten in terms of sizing of our overall portfolio, and I’m not sure we envision it being any bigger in terms of percentage, and then also given shifts in currency rates and the impacts of interest rate differentials. It is no longer as economically advantageous to do your deals in Europe and then pick up economics when hedging back to the U.S. but at a high level. We feel good about the portfolio. And I’d also say from a liquidity perspective, similar to the U.S. slowdown in the market overall. But still plenty of capital available for deals that are ready to be sold or deals that are right for refinancing.
Stephen Laws: Great, thanks for those comments, Stuart, those are helpful. My follow-up question, I want to follow up on Steve’s initial question. You guys have transitioned the portfolio to almost entirely senior loans. And when I look at a leverage table versus peers, 2.8 is a little below most seem to be in the mid or high threes on a total leverage basis. Maybe it’s not near-term, but kind of as you think medium term on an all senior loan portfolio, kind of where do you envision, leverage moving? Do you think it gets to the mid threes? Or kind of how does that look on a medium term basis? And how much does it depend on kind of your financing mix as you move forward?
