And I guess to the point that you’re getting at it also gives us leverage capacity. To the extent we wish to seize upon certain investment opportunities whether they are in our established markets or in our expansion markets that we view as attractive where we can bring the strength of our balance sheet to bear and potentially rely on a greater than normal level of debt that may be attractive relative to those opportunities and lean into the balance sheet and generate some growth in that regard. So we are certainly willing and able to get to that five times to six times leverage in the right circumstances. I will note that there are sometimes when we’ve gotten there in less than desirable circumstances such as three years ago in the pandemic when — we actually were 5.4 times net debt to leverage EBITDA in Q3 of 2020, but that’s sort of preparing the balance sheet for a downturn.
So given where we are it’s a low leverage level, but we think it’s appropriately, so because it gives us strength to deal with potential challenges that could happen ahead as well as strength to deal with potential opportunities that we hope will be in front of us.
Rich Anderson: Okay. Great color. Thanks very much.
Operator: Our next question comes from Haendel St. Juste with Mizuho. Please proceed with your question.
Haendel St. Juste : Hey, good afternoon. Thanks for taking my question. I appreciate the color earlier on the renewals for October, November color on October new lease rates. But I didn’t catch if you did provide them your expectations for new lease rates into the year-end. So maybe some color there on then what would that imply for a full year 2024 earning? Thank you.
Sean Breslin: Yes. It’s Sean. Just — I didn’t provide specific insight into the expectation for new move-in lease rates in Q4. The one data point we did provide is that renewal offers went out in the 6% range. And similar to what we’ve been seeing in the last few months, I would expect them to settle sort of in, call it, 150 to 200 basis points dilution off of that, so kind of 4% range maybe 4.25%. One thing to keep in mind that I mentioned earlier is the comps do get a little bit easier in November and December, and that’s why in markets like the Mid-Atlantic Denver and Seattle you saw an uptick in rent change in October. So all else being equal we expect sort of relatively, I’ll call it, stable glide path through year-end as it relates to lease rates.
The earn-in — we provided kind of a snapshot of the earn-in on the slides that we presented or posted last night at about 1.5. My expectation based on what I know today is that may soften a little bit between now and year-end but haven’t necessarily put a number to it yet.
Haendel St. Juste: Thanks for that. Can you give us an update on the loss of lease in the portfolio and perhaps where it has in Lewis?
Sean Breslin: Yes, that was posted on the slide as well. We recorded loss to lease roughly 2% led by the East Coast markets north of 2 and then the West Coast and expansion regions trailing roughly 1.5 points and around 70 basis points in the expansion regions.
Haendel St. Juste: Okay. Thank you. And then last one and then apologies if you want to touch on this, but are there any markets that you commented that you’re seeing an acceleration in concessions or perhaps more aggressive lease-up for merchant developers?
Sean Breslin: Yes. The one market I mentioned a couple of times earlier that has been softening more recently is Northern California, most notably San Francisco but to a lesser extent San Jose as well.
Haendel St. Juste: Perfect. Thank you.
Operator: [Operator Instructions] Our next question comes from Anthony Powell with Barclays. Please proceed with your question.
Anthony Powell: Hi. Good afternoon. I guess a question on the expansion region loss lease of 70 basis points, which is maybe better than you would think given all the concern about supply growth in some of these markets. Is any one market driving that positive loss to lease? And do you think space markets could be a positive attributor to your same-store revenue growth next year?
Sean Breslin: Yes, good question. I’d say, what — where it’s coming from for the most part is a blend of Southeast Florida and what we’ve experienced a little bit, that’s going to be coming online in the Texas market where it’s a more challenging environment is in Charlotte, which as you may have noted the expansion region rent change is negative. That is effective with the Charlotte market. Three assets. In the south end of Charlotte, there’s a lot of supply coming online there. It’s a great submarket. We love the submarket. When we bought the assets, we knew there would be a fair amount of supply in the first two or three years of ownership, which is what we’re experiencing today, but we believe we acquired them at good values.
So it’s probably a little too early to tell you what 2024 is going to look like there specifically. But anything that’s coming through will probably be Texas and maybe a little bit in Southeast Florida and really not much if anything. And we might even be in a gain deli situation in Charlotte.
Anthony Powell: All right. Thank you.
Ben Schall: Sure.
Operator: Our next question comes from Joshua Dennerlein with Bank of America. Please proceed with your question.
Joshua Dennerlein: Hey, guys. I’m back. Hopefully, you can hear me now.
Ben Schall: Yes
Joshua Dennerlein: Okay, good. So just my question I just was curious because it looks like you’re underwriting the new starts at a mid-6s, but you’re achieving call it mid-7s on your stuff and current lease up? Just kind of what would get us up to that mid-7s going forward, or is there just some kind of element of conservatism built in?
