Douglas Emmett, Inc. (NYSE:DEI) Q3 2023 Earnings Call Transcript

Steve Sakwa : Okay. And then maybe just circling back on some of the questions around development. I mean it sounds like you’re maybe tapping the breaks are not aggressive about moving forward. I guess what would it take? You got some entitlements on some other Honolulu assets. I think you own a bunch of other redevelopment sites for multifamily in L.A. What — I guess, what would the yields need to be on your capital? Or how much have you raised them? And I guess, where are you relative to those new hurdles to potentially start a project?

Jordan Kaplan: Well, that’s a good question. So I think a lot of that, why we’re not because it’s funny, I mean, even now what Kevin said, — some of these sites are in LA. I mean, not — why we have a lot of buy-right, but some of these sites in L.A. are like Virgin on buy right now with these changes, which is incredible. I mean, incredible. And I’m talking about by right, like a major amount of units on sites we own. But then, of course, still, and I will also say to argue for it, is that there — I mean even today, at today’s numbers, much higher cap rates than what anything is trading for. So the last thing you get to is, well, how do we want to use our capital. So do we want to use our capital to just start building a part in buildings in places where now we can do it.

do we want to use our capital to buy buildings, which probably wouldn’t be apartment, probably be office. I mean we obviously want to use some to guard our building. I mean we have a whole list of uses and an easy one that you don’t have to do now because it’s still going to be there, like it’s not an opportunity that goes away is is building these apartments. So that was an easy one to put on hold and go, well, we’re going to save capital for some of these other things, nothing materializes, then probably we will use it to do that or bring some partners in to do that or do. But right now, it’s an easy one to put a hold because it’s not something that’s going to go away.

Operator: And this concludes our question-and-answer session. I would like to turn the conference back over to Jordan Kaplan for any closing remarks.

Jordan Kaplan : Well, thank you all for joining us, and we look forward to speaking with you again next quarter. Goodbye.

Operator: The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect your lines.