Lizzy Doykan: Okay. And to confirm on that – the bad debt reserve assumption for the full year, that’s 45 basis points. Was that reaffirmed for the year or lowered? And how does that compare to what we should expect as a normal run rate?
Heath Fear: Yes. So again, it’s 45 basis points for the entire year, but it’s 75 basis points of revenues for the fourth quarter. And I’d tell you that a typical run rate is somewhere between 75 basis points and 100 basis points. So we are running below typical bad debt this year. And I believe last quarter, our total blended – for the first part of your question was something like 85 basis points for the year. But you know, based on the only 10 basis points of bad debt in the third quarter. So now our full-year blended number is 45 basis points. But when you’re looking into next year, think about 75 basis points to 100 basis points of bad debt as a normalized number.
Lizzy Doykan: All right. Thanks very much.
Operator: Thank you. One moment for our next question, please. And it comes from the line of Connor Mitchell with Piper Sandler. Please proceed.
Connor Mitchell: Hi, thanks for taking my question. Just thinking about – since COVID, the municipal approval process has been pretty slow, some of the employees are still working from home for a while. So, I guess, first, that there is a busy change in that may be sped up a little bit. It’s still – it’s really still have to push them along. And then just a few other follow-ups on that is, are there any markets or certain geographies that are slower than others or kind of waiting on the process to speed up still? And have you guys adjusted the timeline for opening locations for retailers and how are those conversations going?
John Kite: Well, as far as the approval process, I mean, there hasn’t been a lot of change in that. Really over the last several years, it’s never easy, really in any particular market to get the approvals on the kind of timeline that we’d like to. But that’s our job, that’s what we do and we push that very hard. And I think we’re quite successful at it. In terms of timing with tenants, I mean, if anything, they’re trying to get as open as fast as possible in this environment. And so we try to do everything we can to create a situation where we can get tenants open. And you have to realize that it’s not just getting opened as fast as possible, you also have to deal with tenants who have certain restrictions on the time of year that they will open, which I think people always underestimate the impact that that has.
But overall, I mean, we are in an environment where the retailer recognizes that opening a store a quarter early, is a tremendous benefit to them, perhaps even more so than it is to us. So I think we’re in, you know, we’re going to keep trying to push that as much as we possibly can.
Tom McGowan: Yes, one other thing that we do to help expedite is we get to the tenant last week where T.J. Maxx, tomorrow we’re taken off to get with Five Below, and that’s another key point of being able to push deals along as getting in front of the customer. But which we’re doing a lot of right now.
Connor Mitchell: Okay. I appreciate the color. And then thinking about the competition for available space and then the growing demand. In terms of that, the – thinking about the ability for you guys to kind of backtrack some tenants-friendly terms and maybe flip that around to landlord-friendly terms. You talked a little bit about the small shop piece of that and then overall, is there a way to maybe accelerate the mark-to-market or is it just free to capture some more upside with all of the competition for space?
John Kite: I mean, look, I mean, the competition is for space is robust. So I think all you really have to do right now is look at, look at our results and some of the other players’ results in the sense of what we’re able to drive in and certainly, you can see the economics of what we’re doing. But beyond the economics, certainly we’re very engaged in and that’s what takes time in this process to try to get, you know, the best possible lease that we can. But recognizing that we’re partners with our customers, the retailers and both parties have to be successful. So it’s a process, but there’s no question that supply and demand is quite favorable for us right now, and it continues to look that – that’s going to be the trend for certainly at least the medium term. So we will continue – you know, continue to lean into that and do what we do.
Connor Mitchell: Okay. I appreciate it. Thank you.
Operator: Thank you. One moment for our next question. And it comes from the line of Dori Kesten with Wells Fargo Securities. Please proceed.
Dori Kesten: Thanks. Good afternoon. It’s a little bit of a follow-up. You’ve had a good success in getting your fixed rent bumps over 3% for new leases this year versus last. Are you seeing any resistance in any markets in that push?
John Kite: I’m sorry, Dori. Did you say, resistance from a market – you know, from a particular market or just in general?
Dori Kesten: Well, in general, an dif there is any, is it just kind of in a certain market?
John Kite: No, I don’t think it’s necessarily market-driven. It’s – again, this is – certainly comes down to each individual shopping center has its own merits. So each individual deal is different. We don’t really look at that on a broad way, but in terms of pushback, look, I think the retailers are aware that there is a limited amount of high-quality space, they want that space they want to partner with you know an owner like us, that puts a lot back into these properties. And as we try to be the best possible partner we can be to the customer. So I think that’s helpful. In terms of market segments, I mean, really, again if you just look at the math in terms of what we’ve been able to do this year and the amount of – in particular on the small shop side of the business, you know, the great majority of the deals that we’re seeing right now are frankly in excess of 3% bumps.
So I think it’s more and more becoming the market, obviously, you have to own good property, but I would say, more and more that’s becoming the market. And over time this will begin to pay dividends. But when you only roll 10% to 13% of your space per year, this is going to take time to really feedback through. But over the next five years, I think that for sure, you know, the game has changed.
Dori Kesten: Okay, thanks. And then are there any updates that you can provide on some of your future development opportunities on Carillon, One Loudoun? Just around there a potential monetization or likelihood of you developing parts of that – on balance sheet?
