City Office REIT, Inc. (NYSE:CIO) Q3 2023 Earnings Call Transcript

William Crow: Yeah. Okay, and then finally, for me, I kind of like the progression you laid out about the premier buildings, and then tenants being forced into what’s called less than trophy buildings, [indiscernible] I’m just wondering how it feels like that’s a process that’s going to take a number of years to play out at this point. Is that a fair way to think about it?

James Farrar: I think, Bill if you look at all the absorption, the net absorption over the last couple of years is all in that top tier, right. And if you look at occupancy levels of those they’re filling up. And so development pipeline is basically coming to a halt. And those are still being demanded. And so as tenants roll they’re generally wanting to upgrade their space. And that’s going to fill up. I think 2024, you’re going to start to see the benefit in really well located assets that have been renovated, that have a great feel. And that’s where we’re playing to be not with all of our properties, but a good segment of our properties match that.

William Crow: Help me help me understand the supply in a market like Dallas or Phoenix? I mean, they’ve seen a lot of supply and it’s all been Class A properties. Is that just done now or do we still have more deliveries to go?

James Farrar: There’s still some underway, Phoenix I think actually the most recent one just delivered I’m not sure what’s left there. I don’t think there’s a lot — Dallas, Goldman’s doing they’re kind of dedicated power and uptown. So that’s going to get done. There’s a handful of others. But right now, it doesn’t pencil for new development and you can’t get the capital for it. And so you’re going to always see a little bit but I think that’s going to come to a grinding halt until the economics kind of get back in balance, which for us is a good thing.

William Crow: Yeah. Perfect. That’s it for me. Thank you.

Anthony Maretic: Thanks, Bill.

Operator: Thank you. There are no further questions on the line. I’d like to hand back to Jamie for any closing remarks

James Farrar: Look forward to updating you on our progress next quarter and thank you for joining. Goodbye.

Operator: That concludes the conference call for today. Thank you very much for joining. You may now disconnect your lines.