As we look to the fourth quarter, I want to remind you that our enterprise compensation and other expenses are typically higher due to the seasonality of certain expenses. We expect less of an impact this fourth quarter than the typical 7% to 10% and as we’re focused on managing expenses in the challenging and volatile macro environment. Shifting to our investment portfolio, it remains high quality, aligned with our liability profile and well positioned for a variety of economic conditions. We revalued the office real estate portfolio again in the third quarter. The commercial mortgage loan portfolio remains healthy. The current loan-to-value and debt service coverage ratios are strong at 47% and 2.5 times. Specific to our office exposure in the CML portfolio, all year-to-date maturities are resolved, and we are confident in the outcome of the one small remaining office loan maturing in the fourth quarter.
Looking ahead to 2024 office maturities, the underlying metrics are strong with a 63% loan-to-value and debt service coverage ratio of 3.8 times. We are confident in the outcome of the 11 maturities in 2024, of which, only three are slated for the first half of the year. Turning to capital and liquidity, we are in a strong position with $1.4 billion of excess and available capital, which reflects the benefit of negative IMR and includes approximately $940 million at the holding company, which is above our $800 million targeted level, $360 million in our subsidiaries, and $50 million in excess of our targeted 400% risk-based capital ratio. We returned more than $350 million to shareholders in the third quarter, including $200 million of share repurchases and $156 million of common stock dividends.
Last night, we announced a $0.67 common stock dividend payable in the fourth quarter. This is a $0.02 increase and aligns with our targeted 40% dividend payout ratio. Given our current capital position and strong free capital flow, we are increasing our full year share repurchase expectation to approximately $700 million, $100 million higher than previously expected. Combined with common stock dividends, we now expect to return $1.3 billion of capital to shareholders for the full year. We remain focused on maintaining our capital and liquidity targets at both the Life company and the holding company, and we’ll continue a balanced and disciplined approach to capital deployment. We are committed to maximizing our growth drivers of retirement, global asset management and benefits and protection, which will continue to deliver long-term growth for the enterprise and long-term shareholder value.
This concludes our prepared remarks. Operator, please open the call for questions.
Operator: Thank you. [Operator Instructions] Our first questions come from the line of Ryan Krueger with KBW. Please proceed with your questions.
Ryan Krueger: Hey, guys. Good morning. My first question was on real estate. And you mentioned a couple of real estate opportunities that you have some visibility on. I just – I guess my question is, you did $800 million in real estate flows in the quarter. Do you think that type of pace is more reasonable now as we move forward? Or can you give any more color on your expectations there?
Dan Houston: Yeah, Ryan, good morning and thanks for the question. I’m going to have Pat respond to that in just a minute here, but I also want to let everyone know that we’ve invited Kamal Bhatia to join us for our Q&A. Kamal is Global Head of Investments for Principal Asset Management who reports directly to Pat, and will also participate in responding to questions on PGI on earnings calls going forward. So with that, Pat, would you like to take that question, please?
Pat Halter: Yeah. Ryan, thanks for the question. As you highlighted, third quarter, we did have a $800 million net cash flow in real estate. That was from predominantly the institutional marketplace and that was double the prior quarter in terms of net cash flow. To your question, we continue to see an active pipeline and an active opportunity to selectively deploy the $6 billion of committed capital that has not been invested yet in our pipeline as we look forward. And I would expect in the fourth quarter to continue to see a very consistent pace like we saw in the third quarter in terms of real estate net cash flow, Ryan.
Ryan Krueger: Great, thanks. And then on the two outflows totaling $5 billion that you mentioned, what type of funds or what type of asset classes are those in?
Dan Houston: Please, Pat.
PatHalter: Yeah. Thanks, Ryan. As Dan mentioned, we do have two large one-time outflows that we expect to see in the late fourth quarter of 2023 and in the early first quarter of 2024. The first one is a preferred securities mandate, who is with a large client who is merging multiple strategies into one larger sort of a portfolio. The second is a very large large-cap equity mandate with a client that has opted to move to a passive strategy. Just in terms of probably the natural question is, what is the sort of the combined earnings loss impact of these two large mandates? It’s approximately $10 million without offsetting any expense adjustments we are considering as we go forward. We’ve also taken a look, Ryan, at our just overall portfolio, if there are any other one-time outflows we expect as we look forward into 2024. And we have not noted any other ones at this point in time as we reviewed the overall portfolio in our client base.
