Grant Campbell: Yes, good morning, Connor. This is Grant. I’d say from a competition perspective, we’re seeing high net worth and private capital types as the most aggressive buyer profile right now. Some of those groups are — they’re obviously fully aware of what the cap rate is on the buy side, and they’re taking a view that their long-term hold they acknowledge there may be a period of time of negative leverage. They’re willing to accept that. They may be an all-cash buyer. We have certainly seen that in many instances, where groups are saying, we’ll buy this all cash, and we’ll “figure out financing later”. So I would say that competition for us, the same amount of people are doing all the same things. So touring assets, underwriting deals, having conversations. When it comes to who’s actually getting most constructive, it’s high net worth and private capital types.
Connor Mitchell: Okay. That’s helpful. And then you guys mentioned that you’re kind of — you’re seeing this tough acquisition market. So maybe in the meantime, can you just share your thoughts on how you view utilizing that capital for stock buybacks or other purposes currently versus maybe waiting for the market to find some better spreads and you can go after some acquisition opportunities?
Anne Olson: That’s a great question. And one that is top of mind for us. I think when we think about potentially selling or having either free cash flow or other proceeds from sales, our priorities right now are keeping the balance sheet flexible. And so — and also maintaining a very low floating rate debt, which we have currently executing on our value-add program this year. I think we’ll spend around $20 million on value add this year, which — that’s a good return for us and also keeps the product competitive as we hopefully move into a more competitive environment and watch a little the supply moderate. And then after that, I think we’re more mindful of the balance sheet and I think more focused on deleveraging the company than executing additional stock buybacks at this time.
Connor Mitchell: Okay. Appreciate it. Thanks everyone.
Operator: [Operator Instructions]. Our next question comes from Michael Gorman from BTIG.
Michael Gorman: Yes, thanks. Good morning. Anne, I’m sorry if I missed this, but in your discussions about kind of the quarter-to-date trends for the second quarter, are there any particular differences in the geography in terms of the improvement in the new leasing trends across your portfolio?
Anne Olson: No, I’d say we’re seeing improvement across the board. I mean, we’ve seen some outperformance in some of the smaller markets. I mentioned North Dakota. We’ve seen some good performance in Rochester year-over-year. In St. Cloud, we’ve seen good performance. But overall, the market as a whole has moved in a way that’s better for us and seeing stronger new lease rates across the board.
Michael Gorman: Okay. That’s helpful. And then maybe just one last question on the acquisition side of things. Understanding the bid-ask spread, obviously, given all the market volatility, is there any kind of disconnect in terms of underwriting, in terms of buyer and seller expectations for the trends in NOI at the property level, just given some of the impact that we’ve seen across markets in terms of supply or in terms of pricing pressure?
Grant Campbell: Yes. I’d say in this environment, it’s very hard to underwrite large outsized rent growth that maybe certain groups were underwriting here over prior years. So I think the dispersion of underwritten rent growth, if we stick with that variable, that dispersion was wider a couple of years ago than it is today. I think people that are being thoughtful if they were underwriting heavier growth, they’ve dialed that back. Groups that were fair to conservative a couple of years ago, continue to be fair to conservative. So that dispersion has tightened from a rent growth perspective. And I think at the end of the day, its which group is willing to accept some of the variables that we’ve touched on here earlier, perhaps negative leverage, perhaps cap rate that doesn’t maybe feel great to them today, but they believe in the long-term story of the submarket.
Michael Gorman: Great. Thanks for the time.
Operator: Our next question comes from Buck Horne from Raymond James.
Buck Horne: Hey, good morning everybody. Thanks for the time. Quick question for Grant. Because the deep dive on Minneapolis was a really helpful discussion there about the supply pipeline there. I was wondering if you could do the same for Denver. Just kind of discussing where we’re at in terms of the supply pipeline if we’re kind of getting close to peak deliveries? And also just any additional color in terms of trends between the suburban assets versus downtown Denver?
Grant Campbell: Yes, good morning Buck. From a supply perspective, Denver is our market with the highest levels of supply currently 9% of existing stock is under construction, which represents about 25,000 apartment homes. These figures similar to Minneapolis, have also tapered since last quarter. Minneapolis has seen a longer period of tapering, but the data is telling us and telling others that the tapering is — could be beginning in Denver. Next 12-months deliveries in Denver are forecasted at 11,000 apartment halls. That is consistent with 2022 and 2023 delivery levels in that market. So we really try and bifurcate what’s in the pipeline, will that all get completed versus what is actually going to deliver and delivery forecast tell us that we’re not going to see any outsized deliveries. It’s going to be on par with what the market has produced here over the recent past.
