But the — we own a very small part of their overall portfolio. So, it’s not easy to try to go from EBITDA to EBITDAR based on when you own a very small part of the overall portfolio. So, what you see here on EBITDARM is what we’ve been reporting for a long time. And obviously, you can go back and look at what the various trends are. And you’ll see that the overall trend for most of our operators is up in the right direction. So it’s just that EBITDAR wasn’t a scientific number, as we talked about in great detail, I believe, this time last year, it was — we had a lot of subjectivity to it.
Andrew Rosivach: You’re typically taking — you’re making, I’m guessing an assumption of an expense as a percentage of revenues or…
Edward Aldag: That’s correct. Yes.
Andrew Rosivach: Or is EBITDARM is an actual number that you’re getting? That’s correct.
Andrew Rosivach: Terrific. Thanks a lot guys.
Operator: And our next question is a follow-up from Vikram Malhotra from Mizuho. Please go ahead with your follow-up.
Vikram Malhotra: Thanks. Just two quick follow-ups. First, can you just clarify the Utah sale to CommonSpirit. My quick calculation, I think the new rent, is it about 10% lower on a cash basis. Can you clarify, was there a rent change with CommonSpirit?
Steven Hamner: Yes. Yes, there was a rent change. On a cash basis, they’re paying — you can do the arithmetic. They’re paying 7.8% on the roughly $1.22 billion of investment. That’s a reduction from what Steward paid in 2022 by a little more than $6 million. Some of that $6 million will be recovered through reallocation of that rent back to other Steward facilities. And again, all that’s built in to the guidance numbers we gave.
Vikram Malhotra: Okay, that’s helpful. And then can you just maybe give us a little bit more color on the guidance components on two things. Just what’s the what’s the straight line rent baked into the guide on either end of the range, if you can? And also what the G&A range is, if it’s possible?
Steven Hamner: I think we’ll probably have to get back to you on that. I don’t think anybody around this table has an immediate answer, especially the straight line, the G&A is a recent run rate.
Vikram Malhotra: Okay. Thank you.
Operator: And our next question is also a follow-up from John Pawlowski from Green Street Advisors. Please go ahead with your follow-up.
John Pawlowski: Thanks for taking the second question. Steve or Ed, what level of leverage on a debt-to-EBITDA basis on your metrics do you expect to be running at this time next year? I think Ed’s opening remarks, we’re pretty bullish on acquisition pipelines, but there’s — there’s a lot of moving pieces in terms of potential dispositions. So, this time next year, what level of leverage can shareholders expect you to be running at?
Edward Aldag: Let me make the point about the acquisitions that I was trying to make in the prepared remarks there. We have a great pipeline — but until we get a new norm for where interest rates are around the world, there’s not going to be a whole lot of acquisitions from us. As we have said throughout the year, we will continue to support our existing customers and other very strategic moves like we did with the Priory transaction we announced today. But other than that, I’m just making the point that — the pipeline is strong. We’re continuing to work out those relationships.
Steven Hamner: Yes. And what goes unsaid, probably don’t need to be said with that, we certainly don’t expect to be leveraging up to take advantage of marginally accretive transactions.
John Pawlowski: We expect leverage to remain essentially unchanged? Or do you expect to do?
