John Kim : Okay. That’s helpful. And then, Mark, one of your answers, you mentioned that acquisitions are in pause for now. I was wondering if there was a cap rate or spread to your cost of capital over the 10-year that you would be looking to transact at? Or is it more about the timing and the volume activity anticipated over the next six months to nine months and for selling in the market?
Mark Parrell: We remain open for business and acquisitions. We’re underwriting deals. They just have to make sense relative to our cost of capital. We’re looking for a discount to current replacement cost. So, it is right now at a pause because the market isn’t offering us that opportunity. And usually, it happens that there’s a whole bunch of deals that people have signed up and everyone just close them at the end of the year, and that’s not what’s going on there. So there likely isn’t going to be a lot more exposed for sale until the beginning of next year. So, I’m not sure this situation is going to change much. Like I don’t know that Alex and I and the Board are going to make big pronouncements about acquisitions in the next couple of months because there just won’t be much to action on.
But we’re hopeful next year, you start to see folks that look at the higher for longer scenario on interest rates that maybe see some pressure on NOI and especially in the Sunbelt markets, and maybe are more open to selling and folks like us that are more open to buying. The last point to make is what is our source of capital for that. If we’re able to sell our assets in some of these over — sort of over concentrated coastal areas that we like general exposure, but we’re a little out of balance, if that’s the fuel, then we’ll be thinking a lot about the degree or not of dilution between those two. If we’re borrowing money, we’re going to think a lot about not just the beginning cap rate, but where it can reasonably go over the next few years.
But right now, I think we’d be borrowers around 6.4% or so on 10 years, and that’s a pretty significant hurdle. So those are the kind of things we’re thinking about over there. Is that helpful framing for you?
John Kim : Thank you, so much.
Operator: We’ll go next to Jamie Feldman with Wells Fargo.
Jamie Feldman : Great. Thank you, for taking my question. I guess sticking with acquisitions, what is your appetite as you think about your target markets? I mean what is your appetite to do something big? Are there — as you look at the portfolios that are out there, are there anything that you think would be particularly interesting? Or do you think the game plan will be kind of singles and doubles as you sell out of more noncore?
Alexander Brackenridge: Jamie, it’s Alex. We’re open to anything. The bigger is great for us. If the pricing makes sense and if the locations and the quality of the assets are good enough. And that’s generally been the challenge with some of the portfolios we’ve seen over the last couple of years is that the mix of properties and locations just aren’t compelling enough. So, we have been targeting one-offs, and we’ll do that as well. But something big comes up, we’ll certainly pursue it. But in the meantime, there’s going to be a lot of product coming to the market at some point. And we really primed up for that, and we’re excited to take advantage of that opportunity.
Mark Parrell: Just to add, I mean, in 2021, the last time the market was open full blast, I mean, Alex bought and his team, more than $1.7 billion of assets, almost entirely in those expansion markets and a little bit in suburbs of Seattle and Boston. So, we are capable of hitting a lot of singles and scoring a lot of runs by doing that. So, we’re happy to acquire in small dribs and drabs if that gets us to our goal. But as Alex said, we’re open to portfolios, but they just need to make some sense. And a lot of what we’ve seen, you’re getting three things you like and two you don’t, you’re not really ahead of the game.
Jamie Feldman : Okay. So, I guess just listen to your answer, it sounds like there’s nothing that would be a perfect fit at this point?
Alexander Brackenridge: Yes. We’re not looking for perfection to be clear, but there’s nothing that’s compelling right now.
Jamie Feldman : Okay. And then I know there’s been some questions on litigation. There’s an article out talking about a DC RealPage lawsuit and you’ve been named as a defendant. Can you — probably can’t say much here, but can you give us any color on that at this point?
Mark Parrell: You guess it right. I can’t say very much. That just kind of came over the wire to us, too. We are unfortunately in a very good company with a lot of our public and private competitors are in that suit as well. So again, we haven’t analyzed it. We haven’t even been served to our knowledge. So, it’s hard for me to have any real comment except to say it’s not uncommon to have copycat lawsuits filed by other members of the plaintiffs’ bar or by the states and the District of Columbia when you have a lawsuit like the antitrust case that’s being litigated in Tennessee and Federal Court that’s out there and gets publicity. I’m not sure it’s a new risk. It’s the same risk in a different place. And again, let us analyze it, and if it’s appropriate to comment further, we will.
Jamie Feldman : Okay. Thank you.
Operator: We’ll go next to Rich Anderson with Wedbush.
Rich Anderson : Thanks. Good morning. A question to Michael. You mentioned the history of negative 4% to negative 5% by December. If you look at that same history, what’s the new lease rate typically change to by the time we get to April or May?
Michael Manelis : Rich, this is Michael. I don’t have that in front of me right now, but I can tell you that it clearly steps up and it’s got to be in the positive 1% or 2% range because it’s just going to keep sequentially building as you turn the corner into the year.
Rich Anderson : Of course, that would be expected. I was just wondering if you had some specific numbers for December, I thought maybe I’d ask you about specific…
Michael Manelis : I don’t have that specific number by month outside of this fourth quarter. But I’d be surprised if it’s not up near that 1% or greater number.
Rich Anderson : Okay. And then going back to L.A. and perhaps the opportunity cost of having to deal with all this litigation and so on, is there a common thread to some of these bad actors that maybe you don’t want to sort of put them in a group publicly, but maybe that there’s some cleansing that can happen so that you don’t — you say you can avoid some of this scenario that’s perhaps bound to happen in the future? Is there a changing — change to your leasing sort of documentation or your credit quality process to sort of avoid a certain sort of segment of the renting population on a go-forward basis? Or is it just…
