Jade Rahmani: Thank you very much. I wanted to ask about multifamily. We are seeing negative new lease rent growth, slowing demand, so it’s a matter of time before renewal rents catch up in terms of magnitude of growth? And in addition to that 1 million of multifamily units under construction, so a massive increase in supply will pressure multifamily fundamentals. This sector had the lowest cap rates, a lot of deals done even below 4% caps and many of those deals have challenges with interest rate caps that are coming up. So what are your thoughts on multifamily and how exposed you think BXMT is to any credit issues there over the next 12 months to 24 months?
Katie Keenan: Sure. Thanks, Jade. I would start by saying, what we are seeing on the ground in multifamily is, perhaps, a little bit distinct and it may speak to the quality of the markets and the assets that are in our portfolio, and more generally Blackstone. While we do see some deceleration in the growth of rents, we are still seeing positive releasing spreads. And I think you alluded to it a little, but it is really critical to focus on the fact that the loss to lease in these rent rolls is still very significant. So even if you see topline market rents decelerating or flattening out, there is still significant loss to lease, that will create positive NOI growth going forward and that’s what we are seeing. I think the other important thing to note is, if you look at the vintage of origination of a lot of these loans, the real question is, where is NOI going to be relative to when we originated these loans and there’s still a lot of growth between those two things, which supports our basis.
I think the other thing to focus on it and supports DSCR and other cashless. The other thing to focus on is, there’s a tremendous amount of capital that is focused on multifamily. There has been new capital formation focused on filling some of the gaps in the capital structures that may be caused by interest rates or rate caps rolling off or other needs. And generally, I think, multifamily owners are very positive about the long-term prospects of their assets. The market in general is supported by the agency financing market. And I think as a whole, the combination of continued positive, albeit to your point, probably, somewhat less quick or decelerating growth, but continued positive growth, combined with the fact that there’s a lot of capital markets interest and support for this asset class makes us as a lender feel very good about where our loans are relative to the NOIs and the value of these assets.
There will be a little bit of a pop near-term in supply. But beyond what’s already on the ground this year, the supply pipeline is really very significantly falling off. And so, I think, people will also see through interim sort of short-term delivery of some of the assets that are under construction and understand that over the next couple of years after this, there’s going to be very little new supply.
Jade Rahmani: Thanks very much. On the office side, as I go through the portfolio, there’s many markets where we seeing pressure, it’s extremely widespread including markets like Austin, Nashville, parts of Dallas and then the other obvious markets. So how confident are you that your fourth quarter CECL reflects a broad view of the office exposure and that we shouldn’t expect material degradation in credit on that portfolio in the coming quarters?
