Craig Mailman: Hey, good morning. I just want to go back to kind of the small shop commentary, maybe ask a quick two-parter here. But you clearly have some good commentary around the progress at the RPT assets. I’m just kind of curious if you mentioned some grocery-anchors coming on and maybe timing wise is helping, but how much is just your kind of probably broader tenant relationship an asset there versus just the overall kind of pace of the market? And also just in general, kind of what small shop? Has there been any change in kind of mix of activity among small shop tenants that are looking to take space?
Conor Flynn: Yes, great question. So with obviously the broader market is doing quite well, but for us specifically, we’ve launched a variety of programs to really activate our small shop effort and to drive demand and drive demand into our portfolio. We’ve launched a national account management program that’s really piloting and targeting those fast expanding retailers, F&B operators that are looking to hit open-air. And we make regular stops and visits with those retail tenants showcasing the opportunities within the portfolio, really have a concerted effort to try to grow market share with those individual retailers. We sit with franchisors, we do seminars with them to help introduce Kimco to the franchisees within that concept, so they understand what they can do and what they get when partnering with Kimco and all the services that we can provide as a best-in-class landlord operator, and partner to them, we develop form leases to help make the experiences as seamless as possible when engaging with Kimco.
So then that the operator themselves can really focus on developing and delivering the business. And I think what we saw through COVID was the interview of the landlord is almost as important as the interview of the tenant, especially when the market’s constantly changing. You need to make the critical investments into the site. To make sure you’re building the best mousetrap, evolving with the local community and providing those essential services to allow those small shop operators to survive and thrive. And I think that’s being acknowledged and represented in some of the activity that we see as well. In terms of uses, you continue to see growth in the F&B. I mentioned Kava and others earlier in the call. You’re also seeing a continued growth in dollar store concepts.
Daiso is one that was really on a growth path where wouldn’t say they’re necessarily small shop, but they are taking and combining some spaces, creating new opportunities there. So — but holistically, we’re seeing in personal care services. So within the individual retail verticals, it’s pretty broad region.
Operator: The next question comes from Caitlin Burrows of Goldman Sachs. Please go ahead.
Caitlin Burrows: Hi, good morning everyone. I’ll keep from sees on the rise and same-store — sorry, not same-store, the SNO pipeline is still pretty wide, but I guess looking forward, it looks like at least 4 million square feet of space in the first quarter. But that’s down from 1Q 2023 and 1Q 2022, despite not having a larger portfolio. So wondering if you can talk about what’s driving that leasing volume lower, realized it could be for a number of reasons.
Conor Flynn: Yes. I mean, right now it’s obviously our occupancy is also at 96%. Our all-time high is 96.4%. So you’re obviously looking at the opportunity set does change as well with that, and as it relates to the volume, it’s still pretty much in line with prior years and it’s also Q1. And timing of deal execution can vary throughout the cycle quarter-to-quarter. And I wouldn’t say there’s any slowdown in the deal velocity nor the interest in space. We’re seeing actually interest in space in some of our longer-term vacancies now, which is really interesting to see. And the continued conversation that we have with the retailers about where does the next set of inventory come from? They’re continuing to try to hit there and find their opportunities to hit their market share targets, their store opening targets.
And we’re not just looking at current year, but obviously two years out of the rollover schedule. So we’re very encouraged by what we’ve been seeing in the market, and it’s pretty far reaching in terms of geography. It’s really not isolated to any one particular market. Obviously, Florida in the Southeast has seen its fair share of growth over the last several years, that continues, but you’re seeing really across the Board activity, which is very encouraging.
Operator: Our next question comes from Greg McGinniss of Deutsche Bank. Please go ahead.
Greg McGinniss: Hey, good morning. Sorry, a little thrown by the bank there. Glenn, looking at the –guidance —
Conor Flynn: That’s nice. [Indiscernible]
Greg McGinnis: Looking at the guidance update, it’s just under $0.02 from interest income, non-GAAP income, and around a penny and a half, some higher same-store NOI growth at least based on our math. What are the offsetting factors on the $0.02 guidance range? Is that just earlier dispositions and initial plan or any color would be appreciated there?
Conor Flynn: Yes. I mean, again, it was a very strong quarter. There is, as I mentioned, just under penny of, I’ll call them non-recurring or one-time things that are in there. But the balance of the year is shaping up very well. So we increased the guidance by the $0.02 that we saw so far, and feel good that we’re in good shape to reach towards the upper end of that range.
Greg McGinnis: Okay. Thanks. And then on the 10 RPT dispositions, how important was providing the seller mortgage financing on those transactions to getting them done at the 8.5 cap rate? I mean, if the buyer had to go elsewhere for financing, where do you think those cap rates might have trended?
Ross Cooper: Yes. I mean, I really don’t think that it impacted the pricing or the execution at all. Just to be completely transparent, that was a structure that we were excited about in pushing onto the buyer because we really wanted to retain a slice of those assets at yields that are really attractive for us. So as it relates to the transaction itself, at the risk of repeating a little bit of what Conor said, we really tried to telegraph early on what our strategy was on the company and on the acquisition. And we were buying into a great portfolio at a mid A cap where we acknowledged that there was a tail in the portfolio. And we’re really excited that we were able to sell that tail, the same cap rate that we bought the whole company.
So with what we’re left with, Miami, Boston, Atlanta, Austin, Denver, Nashville, just to name a few, at the same blended cap rate that we went into the company and the acquisition. So we feel really good about that. We feel good about the execution on that deal, and we think that it was a win-win for us and the buyer on those 10 assets.
