Steve Sakwa: Okay. Thanks. Last question for me. Just Albert, you sort of mentioned the transaction market in distress and things picking up. I’m curious, are you solely focused on looking at New York and San Francisco opportunities? I know you’ve been in other markets in the past. So would you open up the lens to D.C., again, Boston or other markets? Or are you exclusively looking at San Francisco and New York?
Albert Behler: For the time being, we are looking at San Francisco and New York. We have an office still in Washington, D.C., but we don’t see opportunities there. We had mezz investments, mezzanine fund investments there, and the D.C. market doesn’t seem to be attractive at all for the time being. And I think New York and San Francisco will offer opportunities that are write-down or early, and we will focus on that.
Steve Sakwa: Great. Thanks. That’s it for me.
Albert Behler: Thank you, Steve.
Operator: And the next question comes from the line of Camille Bonnel with Bank of America. Please proceed with your question.
Camille Bonnel: Hi. I wanted to clarify on 111 Sutter. You mentioned you’re expecting an outcome in the next few weeks. Is there any risk that this plays out for a few more quarters?
Wilbur Paes: Camille, I don’t know what you mean by risk. When I think about risk, there is no risk to us and our partners. Right now, what we have is we have a maturing loan that is cash flowing where all shortfalls accrete to the principal balance. The debt is still non-recourse. So there is no risk per se to Paramount and its shareholders in Paramount’s balance sheet. The possible outcomes in this scenario are we continue to extend that in a similar structure, which I think is a tremendously favorable outcome for Paramount and its shareholders because it preserves optionality while limiting any risk to Paramount’s balance sheet, or the outcome is the asset potentially goes back. And if it does, then the debt comes off our books and we would have effectively delevered because there is no contribution from these assets to Paramount’s earnings right now.
Camille Bonnel: Okay. Appreciate the clarification. And there’s a lot going on with Showtime’s parent company. I know that lease is a bit further out, but do you see – like have you started any conversations there? And any probability that, that lease will be extended, too?
Albert Behler: Camille, we are constantly talking to, I think that’s one of our strengths, that our property and leasing management is consistently communicating with our tenants. We want to be very tenant-friendly, so there are communications all the time. And Showtime is a large tenant in our 1633 asset. But it’s too early to say what the plans are there. We have very good demand potentially by other tenants at 1633 who might want to have additional space, but it’s too early to go into any details.
Camille Bonnel: Got it. And finally, just wanted to get more color on the short-term renewal of KPMG’s lease at 55 Second. Just any further details on why they took a renewal for one-year. And if you offered lower rent or more conventions, do you think you could have gotten a longer lease?
Peter Brindley: Hi. Camille, this is Peter. It was more than a year. It was 21 months. We know and enjoy a very good relationship with KPMG. I think once again, it’s too soon to say how this plays out going forward. But for the time being, this was a deal that was acceptable to both sides, and we were very happy to make the deal.
Camille Bonnel: Okay. Thanks for taking my questions.
Peter Brindley: Thank you, Camille.
Operator: And the next question comes from the line of Blaine Heck from Wells Fargo. Please proceed with your question.
Blaine Heck: Thanks. Good morning. Just wanted to revisit the possibility of dispositions, in particular on the retail side, given that we’ve seen some interesting trades relatively recently. Is that something you all would consider in the kind of near future?
Albert Behler: Well, we are, as you know, in the market with 712. We have some vacancy there. We have done a terrific lease with the neighboring property and lease part of the 712 retail to Harry Winston, which is currently under construction. They’re doing a beautiful job, so it will be a wonderful new store, combining 718 and parts of 712. And the rest of the space is currently in the market for lease. I think we did well by taking our time because the interest is coming in our favor. Rental rates, with regard to retail on Fifth Avenue, are really coming up significantly. There’s a very healthy space demand for retail. And I don’t like to comment about dispositions in the retail arena. We have discussions off and on, but there’s nothing to talk about at this earnings call.
Blaine Heck: Great. Thanks, Albert. And just quickly to come back to Showtime. I had been under the impression that you guys had previously said that was a known move-out. Has something changed there? It didn’t seem like your commentary ruled out a potential extension. Just wanted to make sure I heard you correctly?
Albert Behler: No, it’s just relatively early. I mean we have heard rumors by KPMG, for example, it’s another example, last year that they moved out or wanted to move out, and they now extend it in place, and we don’t know whether they will do another extension. My experience has taught me that large corporations change their mind a couple of times, sometimes within 12 months. And we had this in many different cases with banks that wanted to grow or shrink and change their mind because there were M&A business going on. So I think it’s too early to give something definite about that tenant.
Blaine Heck: Okay. Got you. That’s fair. Last one, Peter, can you just talk about what you’re seeing with respect to concessions? It seems to be a little elevated on the leasing you guys did this quarter. Market commentary is that they’re very high, if landlords can even afford to pay them. So can you just talk through those dynamics and whether you’re seeing continued upward pressure on TIs or maybe that’s plateaued at this point?
Peter Brindley: Hi. Blaine, I would say that concessions have plateaued. It may be slightly elevated. I think what you’re referring to is concessions we gave in New York specifically in the first quarter. That was against the transaction we completed on the second floor. And so concessions don’t vary all that much based on rent generally. So I think that’s the reason for it being slightly elevated in the quarter. But all things considered, they are at historical levels. They are high, but they have not gone up recently. They’ve remained stable, and we expect that to be the case going forward.
