So I’m glad it’s normalized a little bit. And now it feels like what the interest rates and two different wars and everything else I get while people are being a little slow and deliberate in their decision making.
Nick Thillman: That’s helpful. Thank you.
Marshall Loeb: You’re welcome.
Operator: Our next question comes from Todd Thomas from KeyBanc Capital Markets. Please go ahead with your question.
Todd Thomas: Hi, thanks. First question, Marshall, you mentioned that you’ve been fortunate to issue equity in the low- to mid-4% implied cap rate range, and the stock has pulled back more recently. And I think you mentioned that you’re trading below NAV. I’m just – I’m a little confused by some of the comments around the go forward plan here, do you do pump the brakes on equity, or do you continue to issue at these levels vis-à-vis the $125 million of incremental equity issuance that’s implied in the guidance? That was the updated guidance issued last night?
Marshall Loeb: Okay. Brent?
Brent Wood: Yeah, I’ll jump in. Todd, this is Brent. Good morning. Yeah, the equity, our stock price has had some volatility just due to macro concerns. And so it’s moved around a lot. And even NAV itself has been very fluid this year. I mean, as most everyone on the call realizes that has been a moving target, but has been drifting down. So, we have full capacity on our revolver. We have just a little bit drawn under $675 million, so it would just depend, we’ve not been crunched for capital so far this year, as you can see, we’ve been very active on the ATM, somewhere around I think $465 million year-to-date issued is very good pricing. So we would take a pause, it’s current pricing, but the way it’s moved up and down, but look, if it were to shut us out for an extended period, then you’ve got to – maybe we won’t be able to do certain things on some of the good opportunities, Marshall alluded to maybe on some one-off acquisitions, or that could impact our decisions on starts next year.
But we’re just going to take that as it comes. Again, understanding we have plenty of dry powder to fund what we’re doing, it’s just a matter of the cost of funding. And, obviously, we’ve been very pleased with what we’ve been able to do this year. And so, we’ll just take it as it comes, the way that the markets been and look at my phone and see our price drop and say, [as Marshall] [ph] talked about higher, longer or in this odd environment today, you have good consumer news, which is bad, because we want the economy to slow for interest rates to come down to us all those factors that go into it. So as we’ve always been, let’s be flexible. And let if the market will allow us we’re excited about what opportunities are out there.
But at the same time, we’re not – as Marshall says, we don’t have to do anything, obviously, we’d have to unwind what we’re doing. But so we’ll just take it as it comes, we’re in a good position. And if the price raises its head up just for a little bit, we’re in a position to grab chunks and continue what we’re doing. So we’ll just take a wait and see approach.
Todd Thomas: Okay. And then my follow-up question on the development and value add pipelines look like some of the conversion dates moved around a little bit, some of the 2024 conversion dates, moved into 2025, for example, that does that reflect delays in the completion of construction or delays and your assumptions around lease up for those assets? And then, can you also just for clarification, just I’m curious when you stop capitalizing interest and cost capitalization on developments all together? Is that at the time of conversion?
Marshall Loeb: I guess, answering it reverse. Good morning, Todd. As we’ve always underwrite 12 months after completion to level it. Well, the earlier of when we hit 90% occupancy, or 12 months after completion. So thankfully, the outside date has been the last few years has been that 12 months after. The movement within completion dates, you’re right, it’s more construction timing related than us, stopping construction that we really didn’t do any of that, or things like that. Traditionally, it’s been weather and things like that could be one of the reasons. And things have certainly gotten better supply chain wise, post-COVID. But what we’re hearing kind of ordering switchgear, electrical transformers, those type things, that’s really gotten to be – that’s always the new item that takes a year now.
So we used to be able to deliver buildings in about 6 months pre-COVID, and now that’s stretched out. And that’s what’s kept the construction pipeline so far for a little bit longer than it normally does. But any kind of electrical equipment takes a while. And my guess is just the timing here, they’re on orders or concrete. I guess the good news in a number of our markets is where we’ve had the new semiconductor plants or some of the government work that’s done between whether it’s Dallas or Austin or Phoenix. The bad news is when we’re also ordering those same concrete and subcontractors, it’s awfully hard to get on their schedules on a timely basis to lead times.
Todd Thomas: Okay. But I guess, if we look at the under construction pipeline, and those conversion dates is that currently the schedule they’re set for when completion is anticipated or did you move them back though it’s related to construction completion being delayed, it is not related to a delay at all in your lease up assumptions. Is that correct?
Marshall Loeb: Correct.
Todd Thomas: Okay.
Marshall Loeb: And just to be clear, just on the side of being conservative, we typically always put into the anticipated conversion date that we list, they’re typically the 12-month date outside of what we expect to be completion. And then, we typically don’t narrow that window unless once it’s a built-to-suit obviously we would base that on delivery day or if a project begins to get leased up or to 100%, like you see on the schedule now, we have a project for the 100% leased, but still under construction. We will begin to tighten that window once it’s 100% in that case, it’s closer to delivery. But on the newer project started, we always start from a basis of 12 months outside of our expected completion. And so when those dates move around a little bit, as Marshall mentioned, is typically that the construction maybe is bumped back a month or two from the expected timeline.
Todd Thomas: Okay. Got it. Thank you.
Marshall Loeb: Sure.
Brent Wood: You’re welcome.
Operator: Our next question comes from Samir Khanal from Evercore ISI. Please go ahead with your question.
Samir Khanal: Hi. Marshall or Brent, this is more of a modeling question. Just curious, your G&A expense guide was down, which was about $0.02 on earnings, I guess what was driving that and just trying to figure out the right run rate to use going forward?
Brent Wood: Yeah, this is Brent, the G&A was down, actually our actual expenses for the quarter relative G&A were along the lines of our budget, but we actually had more capital overhead development costs than we anticipated. And so that that capitalization in that line item reduces G&A. So, yeah, I think where we are for the 3 quarters, year-to-date would be a good run rate number. For the third quarter, I say that quarterly number was a little bit low relative to the other two, and that was just, again, the capitalization impact of that particular quarter. But I would say for the 9 months, the total for the 9 months today is – has landed about where it should be. And fourth quarters, you can see we’re pretty much from that point forward. I think that year-to-date number we’re forecasting now is a good optimal 12-month G&A figure for us that pretty much maximizes the amount we can capitalize from the development side of things.
Samir Khanal: Got it. And, I guess, for Marshall, there’s been a lot of conversations around onshoring, I mean, maybe talk about what you’re seeing on the ground, how much of that is a conversation with your customers. And how much of that is sort of a demand driver in your market things?
