Steven Freishtat: Yeah, Jamie. So, when we chatted on the Q4 call, we talked about the three interest rate cuts in the latter, the latter part of the year. Obviously, there’s been a different chatter from the Fed. I mean, now we’ve got one rate cut in the back half of the year as our base case. And as I talked about on the call, we still think that our guidance is appropriate that because it’s in the latter half of the year. It’s not really having an outsized impact as if we had assumed it earlier. So — and then we’re, of course, trying to manage our cash and debt balance. As far as capitalized interest, there’s really no projects that I’m aware of that we’re aware of that we’re working on, that we’re going to be working on that would have any sort of a material impact on capitalized interest. So, it should be a pretty clean year from interest expense perspective.
Jamie Feldman: Okay. That’s helpful. And then, I guess, just thinking about liquidity. Any — I know you talked about the apartment transaction market, but any latest thoughts on Watergate appetite from investors to potentially buy it, or how you’re thinking about getting that done in timing?
Paul McDermott: Yeah, Jamie. It’s Paul. Just to start out with the Watergate, we’re actually in a pretty good, positive discussions with our current rent roll on extensions, trying to create more walt there. We did have our first transaction, what I would say of note with Market Square being sold in the first quarter this year. We’re definitely seeing, I would say, probably more foreign capital than domestic coming into DC right now, looking for some of these iconic assets that are clearly on sale. I think the challenge remains really the lending community. I’m trying to embrace office as a vehicle or an asset class right now. But I think with our extensions, and we’ve definitely seen a pickup in interest. Our goal to monetize this asset in the next 12 to 15 months has not changed. And we feel like we’ll be able to accommodate that timeframe.
Jamie Feldman: Okay. And then, so what would be an appropriate — or just in terms of cap rate or value — what do you think even — what’s the range even think about?
Paul McDermott: Well, I’m going to go off of our fourth quarter markdown where we are — we took a write-down on the asset. And that will obviously be the number that we’re targeting for — shooting for in terms of where it goes. I think a lot of that is going to be predicated right now. If your crystal ball is better than ours, I’m forecasting where the 10 years is going, that’s going to have obviously a lot to do with it, but we hope to get as close to that range as possible, Jamie.
Jamie Feldman: Okay. Great. Thank you for that. And then, I guess, just to get a little bit more granular on some of the rent numbers. Well, I guess just to start, can you talk about your absolute level of bad debt in Atlanta today as a percentage of rental revenue or whatever your preferred metric might be?
Tiffany Butcher: Yeah. Sure, Jamie. As I was mentioning on in the answer to the last question, if you look at our first quarter, our bad debt was 7.5% in Atlanta that has come down. So, we are trending closer to the, say, 6.5% range as we’re heading into the second quarter. As I mentioned, that is continuing to kind of come down on a month-over-month basis. So, we’re projecting that as we head through the end of the year, we will be in the 3% to 4% range on the bad debt as percentage of revenue in the fourth quarter, which if you think about it as an average for the year is probably going to be in the 5% to 6% range.
Jamie Feldman: Okay. And then, also just to get more granular, thinking about — I know you provided the renewal and new lease and blends for the year. How would you break that out between at Atlanta and DC for each of those metrics? And same thing with like the April numbers?
Tiffany Butcher: Yeah. Sure. I’m happy to give you that. Let’s start with the year as a whole, and then I can go back and talk about the second quarter. If you think about the year as a whole, we are assuming that the portfolio overall blends are in that 1.5% to 2.5% range. But if you break that out between DMV and Atlanta. In the DMV, we’re expecting 2.5% to 3.5% blends, which is made up of, say, 1% to 2% new and 4% to 5% renewal. And if you look at Atlanta, we’re expecting blends to be in the negative 2% to negative 4%, which is high single — negative single digit, say, 7% to 9% negative new lease rate growth and renewals in a positive 1.5% to 3.5% range. So that’s where we’re expecting kind of the full year to shape up. If you look into where we’re trending for Q2, we’re expecting kind of blends in the, say, a 2% to 3% range for the portfolio as a whole.
And if you break that out between DMV and Atlanta, we’re expecting blends in DMV to be in the 3.5% to 4.5% range, which is made up of 2% to 4% new and 4% to 6% renewal growth. And if you look at Atlanta, we are trending into the sort of negative 3% to negative 5% negative blends, which is made up of a very similar a new, a high negative single digit new lease rate growth of negative 7% to negative 9% of a positive renewal growth of 1.5% to 3.5%. I would say April is trending slightly ahead of those 2Q averages, but we feel very good about where we’re trending for Q2.
Jamie Feldman: Okay. And then, just to benchmark the bad debt number you’re talking about for ’24, how does that compare to the bad debt number in ’23 just for like a year-over-year comp?
Tiffany Butcher: Yeah. No, great question. So if you look at the fourth quarter for ’23, we were at negative 10% for the Atlanta — you’re just talking the Atlanta portfolio, correct?
