Todd Thomas: All right, thank you.
Operator: Thank you. One moment for our next question. Our next question comes from Juan Sanabria with BMO Capital Markets. Your line is open.
Stuart Tanz: Good morning, Juan.
Juan Sanabria: Good morning. Just hoping you could talk a little bit about the latest thoughts on Rite Aid. I think they’ve increase their store closure count, and maybe there’s some, maybe delays or hesitation there and some back and forth in the market that they may pursue. Chapter 7. So just curious on what the plan would be if that were to eventuate with Rite Aid?
Stuart Tanz: Well, yes, obviously, as you’re touching on there, there’s a bit of uncertainty about, the final outcome of the Rite Aid situation. We have reached agreements with Rite Aid on all the remaining locations, extending the terms on most of those, and we are hopeful that that plan will get approved. But in the event that it doesn’t, the demand for our spaces continues to be very strong. And as we touched on with the spaces we did get back, they were spoken for very quickly. So while we’re hoping that the plan gets approved, we’re also prepared to capitalize on the opportunity if it doesn’t.
Juan Sanabria: And what’s the closure at this point? What would be perspective in terms of what you’d need to release once those stores close based on the current plan as it stands now?
Michael Haines: Well, if you look at what’s in the pipeline in terms of leasing, that would be the current locations that they gave up. So…
Stuart Tanz: Yes, we started out with 15 Rite Aids. Three of those were rejected. We did sign agreements on the remaining 12. They recently announced some additional closures. One of our stores was on that list. It’s not an anchor space. And the day after it was listed, the adjacent grocer called us about expanding. So again, we feel that there’s still a lot of demand for these spaces. And while we would rather not get them back, we’re prepared to get them back, and we’ve already got our ducks [ph] in a row, and our leasing team is focused on talking to the potential tenants in the event that that happens.
Juan Sanabria: Okay. And then how much NOI, I guess would go away temporarily on the anchor spaces that you’ve spoken for and released. But just thinking about the cadence of same-store NOI growth and what those anchor leases mean to your forecast for the rest of the year, just so from a modeling perspective, we can capture that appropriately.
Michael Haines: Juan, are you referring to the three that we got back already and have released, but not in a pay yet?
Juan Sanabria: Correct.
Michael Haines: We didn’t model anything for those spaces in the 2024 same-store NOI or FFO. So there’s nothing in the numbers for that.
Stuart Tanz: And, Mike will get back just in terms of the number, if that’s what you’re looking for.
Juan Sanabria: Yes. How much was in the first quarter? Just to make sure that we’re capturing whatever the sequential drop-off may or may not be. But we can follow up offline.
Michael Haines: In Q1, there was nothing in our numbers for the three Rite Aids basis.
Juan Sanabria: Okay. And then lastly, was there any sort of comp issue with regards to expenses? Going back to Todd’s question on the same-store NOI that may have positively impacted the year-over-year result there that we should kind of think about going forward?
Michael Haines: Nothing. I know last year we had some snow removal costs that were accelerated, but outside of that, nothing I can think of no specific item.
Juan Sanabria: Okay. Thank you very much.
Operator: Thank you. One moment for our next question. Our next question comes from Craig Mailman with Citi. Your line is open.
Michael Haines: Good morning, Craig.
Craig Mailman: How are you?
Michael Haines: Good.
Craig Mailman: Just to follow up on the anchors, the leases were you guys able to kind of start to put through any better escalators in these deals or as you guys get early renewals? Is that in the conversation now with some of these anchor tenants? Or is it still kind of more of the minimal bumps relative to what you’re getting in shop?
Stuart Tanz: Well, on one anchor, big anchor of vacancy, we were able to get more term than usual from the tenant and probably even higher rent because this particular tenant needed this space extremely badly. It’s a new concept and one that they need to get rolled out very quickly. So we sort of had the upper hand there in terms of negotiation, the balance of those spaces rich, just in terms of the ordinary, what you would ordinary see from these tenants.
Michael Haines: Yes. I think that the ongoing increases is sort of this historic, which is for an anchor tenant every five years, 10% to 12%. And for our shop space to, we’re still around 3% annually.
Craig Mailman: Okay. And this new concept, is it kind of grocery, is it new to the U.S. or just new to your markets? What’s the credit profile look like?
Stuart Tanz: Very, very, very strong. They’re already in the U.S. in a pretty big way. But this is a brand new concept that has proven to be a lot more profitable than their current inventory of stores.
Craig Mailman: And then just on the acquisition. I know you guys got a couple of questions on this already, but just from what was an initial guidance from a timing and kind of spread perspective relative to your cost of capital, can you just give us a sense of what that was as a contribution to the range and so how much sensitivity there is? If the acquisition market remains a little bit stalled here and things get pushed out to year end. Like how much of guidance is at risk just from the acquisitions piece?
Stuart Tanz: So, Mike, we modeled, if I recall, I think its 25 million out per quarter or a bit more than that.
Michael Haines: Well, our initial guidance is $100 million to $300 million, so it’s really going to depend on the equity market as far as availability for equity capital. And right now we’re turning our capital to support the acquisition side. So it’s going to depend on how the market kind of evolves over the course of the year. Obviously, rates make a change in favor then REITs typically respond very positively. So that could impact, our stock price would make it more accretive to use that as a funding source.
