Richard Hickson: Yes, that’s right. I mean, how we’re looking at the building blocks is that again, given we have expirations that are really historically low and the timing of those, which are more toward the back of the year, put that next to the commencements that we just talked about that we feel like we’re going to be able to, through the year, maintain and then hopefully, demand willing, we think build occupancy towards the end of the year.
Colin Connolly: And John, some of the delta between our percentage leased and percentage occupied, some of those leases are ones that won’t commence until 2024. So some component of that, again, will be a tailwind for us as we move into 2024. We’ll just get some component of that lift in 2023.
John Kim: And Colin, you mentioned obsolescence in your markets. Is there any way you can quantify the percentage of overall stock that’s obsolete in your different markets? And what do you think is going to happen to some of these assets?
Colin Connolly: That’s a million-dollar question there, John. It is — it varies by — from market-to-market. I’d say, certainly, as you look at our Sun Belt markets, I’d say the average vintage of our properties is newer than what you would see in some of the gateway markets. So I think there’s overall less obsolescence in our markets. But I’d still — again, look at anything that was kind of built before the 1990s as you get into that 80s and 70s vintage product. And I think in some markets, it’s anywhere from 10% to 20% of the inventory. What happens to, I think, it’s going to need to reprice. As I mentioned, there’s very little capital or leasing demand for that type of product. And so eventually, it will have to reprice to a value that will allow you to either invest capital to convert it to anything from a residential property to a data center to — in some instances, if it’s just not — the bones, just aren’t there, it’ll will have to reprice to a tear down with some sort of new product built on that.
That process will take time. But I think importantly, in the interim, those properties are becoming less and less relevant to the overall office market. And I think effectively, we’ll be removed from the inventory. And I think that will help the overall rebalancing of supply and demand for premium properties.
John Kim: My final question is for Gregg, just a following up on Neuhoff. Can you just remind us on your accounting treatment when you start expensing interest on that rather than capitalizing.
Gregg Adzema: Yes. We’ll capitalize interest on any development project, including Neuhoff on the unoccupied space until the property has either been delivered for a year or becomes 90% occupied.
John Kim: Great. Thank you.
Operator: Our next question will come from Camille Bonnel with Bank of America. You may now go ahead.
Camille Bonnel: Hi, good morning. You mentioned that cash leasing spreads were significantly higher, excluding the Houston leases, was there any particular market driving the elevated levels? And do you expect to continue signing leasing spreads at these levels?
Richard Hickson: Hi, Camille, this is Richard. Yes, Austin has been and did in this quarter to drive the roll-ups. But Austin was over 10% — or excuse me, Atlanta was over 10% as well. So — but Austin really is a driver there. Again, as I mentioned in my remarks, we see some softening happening in Austin potentially in the near-term, so that could moderate. But really, at the end of the day, so we’ve always said there’s volatility in how we report those metrics based on lease mix and geography. So it’s tough to predict any quarter-to-quarter.
