Peter Abramowitz: Thank you. I appreciate the comments and the color on 3350. Just wondering if you could talk about two of the other buildings in your portfolio with significant vacancies. Could you talk about activity at North Park as well as 111 Congress. You have some large vacancies there? Just how is the interest in those spaces and any potential contribution for 2024?
Colin Connolly: Yes. Good morning. It’s Colin. I would say, looking at those two properties, North Park has been a bit more of a challenge for us. It is a more suburban property in the central perimeter here in Atlanta. And that market has been slower to recover its leasing velocity than some of more urban markets. North Park over the long term has some great thing going for it. Its sits right on [Technical Difficulty]
Operator: Pardon me, speakers, your line is open. Gentlemen, excuse me, we lost connection.
Colin Connolly: We can hear the operator.
Operator: Speakers are reconnected. Please continue.
Colin Connolly: You missed the punched line. Sorry, for the technical difficulty there. I was just mentioning that North Park has been a bit more challenging, the central perimeter has been a little bit slower to recover in its leasing activity, but North Park does have some positives with MARTA stop directly on campus. 111 Congress in Austin, again, our urban markets have seen more activity. 111 is a great property with many guest, four or five years ago, a significant redevelopment was done with a major food hall on campus, and that’s a property that we believe when we find the right customer, we’ll hopefully be able to drive some occupancy there sooner than later. And I think likely ahead of North Park.
Peter Abramowitz: Got it. That’s helpful. And then just a higher level question. A lot of your peers this quarter have talked about just slower decision making from tenants and generally longer deal cycles. Just wanted to see if you had any color on whether you had similar experience if you’re seeing that in the portfolio, or if that hasn’t really been the case for you?
Colin Connolly: So we’ve got some competing forces at play. And I think higher interest rates are at the center of all of those competing forces. And I’d say, I’d characterize this on the negative that in some instances, higher interest rates are forcing companies to become more efficient. And, therefore, they are scrutinizing headcount, G&A and real estate spend very, very carefully. At the same time, we always say here at Cousins as the Fed raises interest rates, they’re also driving employees back to work. And I think we’re seeing some instances and there’s some active deals that Richard has alluded to, that are directly tied to as companies focus on the bottom line and profits, they want their people back in greater force and in some instances, are realizing they don’t have enough space.
And so we are seeing a push and a pull there. And our belief is regardless that with the quality of our portfolio and our ability to fund leasing costs that we’re going to work really hard to gain as much of that market share as we can.
Peter Abramowitz: Got it. That’s all for me. Thank you.
Colin Connolly: Thank you.
Operator: And our next question will come from Dylan Burzinski with Green Street. Please go ahead.
Dylan Burzinski: Good morning guys, and thanks for taking the question. Apologies if I missed it as I joined late, but just curious, given the strong leasing activity year-to-date and minimal lease expirations next year, would you guys say it’s fair to say that occupancy at the portfolio level has maybe bottomed here?
Colin Connolly: We hope so. And again, as you mentioned, we have modest expirations next year, no significant other than accruent large known move-outs. So again, we’ll have to monitor the evolving situation with WeWork. But WeWork aside, our hope is certainly, I’d say our goal as a company is certainly to end 2024 occupancy higher than it is at the end of 2023. And there could be some modest fluctuations positive and negative quarter-to-quarter. But that certainly is a goal.
Dylan Burzinski: And then I guess just one on inbound activity from out-of-market tenants. Have you guys seen that slowdown here more recently relative to the level that we saw coming into the pandemic?
Colin Connolly: Well, I would say it’s reverting back to where it was prior to the pandemic. And again, this has been a trend that’s been underway for 10 to 20 years. And it’s been up into the right. I think for all the obvious reasons that we know, it was certainly supercharged during the pandemic, and I think we’ll see that likely to revert back to the mean. I think in the immediate near-term, I’d say the biggest challenge to some of the relocations is just the higher cost of residential mortgages. And so I think kind of the full-scale relocations of the company might slow until that normalizes. But what we are seeing a lot of companies do is rather than relocate employees, they are moving or shifting their growth to the Sun Belt and hiring within markets, which mitigates that. So I’d say I think you’re likely to see continued activity on expanding hubs and perhaps more kind of near term, a more near-term slowdown in full-scale relocations.
Dylan Burzinski: Great. Thanks, guys.
Colin Connolly: Thanks, Dylan.
Operator: And our next question will come from John Kim with BMO. Please go ahead.
John Kim: Thank you. On WeWork, is there anything you could share on the characteristics, whether it’s occupancy or profitability between the two locations that they remain current on rent versus noncurrent?
Richard Hickson: Yes. Unfortunately, we are under an NDA, so we can’t share specifics about the performance of each location at this time.
John Kim: Okay. And I’m just wondering like what gives you confidence that the two remaining current leases will still continue to pay rent on that?
