Linda Tsai: Thanks.
Operator: Next question comes from Ki Bin Kim with Truist Securities. Please proceed.
Ki Bin Kim: Thank you. First, best wishes to Jim. I think most people on this call really like the guy and hope he does well. So if I just look at your results and look at your leasing volume and spreads I would think the U.S. consumer is on really good footing, right, and your occupancy levels are high. But I also kind of go back to thinking about the Sports Authority or barns and there’s many retailers that open stores right up to bankruptcy. So — also just curious what you’re hearing or seeing on the ground in terms of customer strength or weakness in different categories?
Brian Finnegan: Yes. We can see it come through in our traffic, right, which has continued to grow. Year-over-year, we had good traffic trends in both in March and February. It was a little bit light in January, just some seasonality on that from a weather standpoint. But other than that, we’ve seen some growth year-over-year. And I tie back to the credit underwriting standards that we’ve been doing. I mean, this isn’t just for small shops, right? When our team is looking at an investment we are looking at what’s been their last — would have been their comp sales performance, right? What’s — is this a market that they’ve expanded and how much capital are we putting into the space. So this certainly goes into our decisions.
And I think you’ve heard Jim talk about it on several calls in terms of how targeted this demand is. This isn’t kind of exuberant demand chasing rooftops or chasing greenfield development. This is infill demand where tenants have realized that they’re performing in a given market where they feel like they can put another store in and they’re coming back to kind of more existing centers or centers that have been invested in. So we feel really good about the intentional demand, and you think about the data that our retailers have today versus some of the names historically that you mentioned, they know their customers a lot better than already because — what we do because they get the credit card data. So I think when they’re looking at their pro formas, they feel pretty good about ultimately hitting those sales projections.
So I’d say overall that we’re certainly encouraged, but we’re doing a lot more work today around those decisions than we ever have.
Ki Bin Kim: And on the urgent care topic, also just curious, at least in New York, it does feel like these places charge more than just senior primary care physician or going to a regular doctor. I’m not sure if that’s the case across the country, but I’m just curious if in this inflationary environment, if that is a higher cost offering if that’s having an impact on consumer decisions.
Brian Finnegan: I also think it’s based off of insurance and a lot of insurances are going to push folks to urgent cares versus kind of primary decision. So I think that depends in a given environment. But ultimately, it’s the convenience, right, associated with it, right, to go and not sure if you can get an appointment, you can pop in and be in there in an hour or so. So even some circumstances where you may pay a little bit more, you’re getting the care that you need very quickly.
Ki Bin Kim: Okay. Thank you.
Operator: The next question comes from Greg McGinniss with Scotiabank. Please proceed.
Greg McGinniss: Hey, thanks for the follow up. Just had a couple of quick ones on development. With the recent acquisition next to Three Village, does that provide you ownership of that entire retail block? Or are there still some unowned adjacent parcels. And does the acquisition unlock larger redevelopment opportunities? Or what was the reasoning behind that acquisition?
Mark Horgan: Yes. So when you look at Three Village in West Center, ultimately, there is kind of a third portion of that center where the other grocer is. And when we’re talking about redevelopment there, probably over the long term, given the incredibly supply-constrained market there, there could be nonretail uses, but that’s not our plan. Our plan is to take advantage of owning West Center and Three Village and really drive value across the retail platform we have in advance there. For example, since we now own a West Center, we may be able to build an endcap drive-through, there, which we would not be able to do before. And conversely, the landlord who owned before couldn’t do that either. So that’s really just a small example, if we think about that clustering and ability to put those together to drive more value across both centers than you could owning just one or the other.
Greg McGinniss: Okay. And then as a follow-up, we also noticed that Kessler Plaza and Northeast Plaza moved from major to minor redevelopments and the supplemental disclosure. Why did you decide against multifamily at Kessler and what changed at Northeast?
Brian Finnegan: Yes. I think we’re always looking, Greg, at what the highest invest use is for the shopping center we have in Northeast Plaza, it’s just outside of Buckhead in Atlanta, we’ve had a ton of retail demand there. And I think what some of the challenges that we’ve been seeing in the multifamily market are causing us to relook at this as well. But ultimately, if we see that we can drive great value and it could be highest and best use for retail, it makes sense. We also have some underlying leases there from a timing perspective. So we’re balancing, okay, what can we do there long term? What’s the demand from a retail standpoint? And how do we get to that space, right? How can we ultimately execute with some of the leases that we have in place.
And then we found just a fantastic medical deal speaking of Medtail that we were able to get done in — at that location in Dallas at an incredible uptick in rent with a minimal capital investment that made sense versus the timing of when we ultimately think we could execute on multifamily. So just because we — I think we show that to you, ultimately, so you have visibility into the pipeline going forward. But things change, right? And we were nimble. And I think what the plans that we have in place now are allowing us to really drive and create value for those centers and in those markets.
Mark Horgan: One other thing I would add, as you look at our redevelopment plan, we’ve been getting great yields, which have been higher than, say, a multifamily project. And from a risk/reward perspective, we are a retail owner. We know what we’re doing in those situations. As we look at capital allocation, we’re trying to be very disciplined. And to the extent there is really great multifamily demand, we may sell it like we did a couple of years ago in College Park, Maryland, where we sold 1.6 acres for $32 million to a developer. So we’re going to always look for the right way to find good, low-cost capital and drive the business forward from here.
Greg McGinniss: Okay. Thank you both for the call. And Brian, nice job, quarter back in this call.
Brian Finnegan: Thanks. We appreciate it. We miss them, but I look forward to having them back here soon.
Operator: Thank you. At this time, I would like to turn the floor back over to Stacy Slater for closing comments.
Stacy Slater: Thanks, everyone, for your time today and also for all your support.
Operator: Thank you. This does concludes today’s teleconference. You may disconnect your lines at this time. Thank you for your participation and have a great day.
