Matthew DiLiberto: Yeah, John, it’s Matt. So I read quite a bit of commentary out there that this was a miss, which kind of threw me because actually the quarter was ahead on our numbers. And if you look at what our guidance adjustment was, our new guidance range, both the adjustment we made back in January, the adjustment we made last night, are due to the incremental DPO gains, discounted debt extinguishment gains at 2 Herald, 280 Park, and 719 Seventh. That would say all of the other assumptions that fed our guidance back in December are intact. So if the first — we don’t guide on a quarter-by-quarter basis, we guide on a full-year basis and our full-year guidance is the same. So if it was — it struck people as low in the first quarter that’s relative to their models not ours.
We were ahead of our model by a few pennies, excuse me, mostly on the NOI and summit side. And if people need to adjust their models to reflect higher in the second, third, and fourth quarters to get back to the core number that we guided to, they should do that. Our quarterly earnings are not linear. We have fee streams that come through that make them lumpy. We have NOI building over the course of the year, as we increase occupancy. So, you know, first quarter was better than our expectations and our full year guidance is intact.
John Kim: Can I ask about 280 Park and the loan refinancing? It seems like there’s very little residual equity in the assets. You didn’t have to pay down any of the senior mortgage, although part of the [loan] (ph). What was really in it for the senior lenders on the transaction?
Matthew DiLiberto : So first, just to make a statement up front, disagree with the assessment about the residual equity. Not at all. With respect to just the market in general, and then I’ll speak about 280, as we saw with all these extensions and what we’re seeing both in the CMBS and the balance sheet side, and as we demonstrated with all those announcements, we’re able to get substantial runway and term on all these deals and in return, the lenders want to see some form of skin in the game. At 280 we put up reserves for leasing costs that we were otherwise going to spend at the asset and in assets that have free cash flow the lenders were looking for some form of skin in the game, which we demonstrated through some symbolic paydowns.
So as we’ve been telling people on the past few earnings calls, you know, these are lenders that we have big relationships with and they’re looking and they have tremendous faith in us. So you should expect to see more of what we got done over the past quarter as we get done the balance of the $5 billion program.
John Kim: Great, thank you.
Operator: Thank you, one moment for our next question. And our next question comes from Tom Catherwood with BTIG. Your line is now open.
William Catherwood: Thank you. Good afternoon, everybody. Obviously, very strong quarter on the leasing front and Marc, you sound convinced on the durability of this demand. How does your leasing pipeline compare to the 1.4 million square feet roughly that you had at the start of last quarter and could you provide some more color on the reemergence of the tech sector that you mentioned in your remarks?
Marc Holliday : Yeah I’m going to actually hand that ball off to Steve Durels so we can go right to the source here because he’s in charge of that pipeline, obviously, and can go into some discussion about, you know, after having done, by the way, big leasing in the fourth quarter, big leasing in the first quarter, you would think that pipeline’s depleted, but maybe not. And on the tech sector, we have some thoughts on that as well.
Steven Durels: Sure. So just to give you a little color on the pipeline, we actually have grown the pipeline despite very strong leasing in the first quarter, we’re now at a current pipeline of over 1.6 million square feet. Of that 1.6 million, 840,000 square feet of it is actually leases that are out in current negotiation, as opposed to over 700,000 square feet of term sheets that are in negotiation. Of that, two-thirds of the space is our new tenants as opposed to renewal tenants. I think another point to make within the pipeline, is that – of the leases that are out almost 500,000 square feet of those leases cover current vacancy within the same store portfolio. With regards to the increasing demand from the tech sector, there’s over 5 million square feet of current tech tenants that are being tracked in the market today, not necessarily just within our portfolio, obviously, but active tech requirements with tenants that are searching the market, that’s a 53% increase from a year ago.
And just to give you a flavor, we’ve seen tenants like Intuit and Fanatics and Figma and a couple other big household names that have started to kick tires in the market as a result of adding headcount to their Manhattan employee population.
William Catherwood: That’s great. Thank you for that, Steve. And then maybe on dispositions, obviously it was great to see 719 Seventh and Palisades go into contract. And we understand that the mix can potentially shift throughout the year, though the aggregate remains the same. That said, is OVA, the partial interest sale there, still in the plan? And what is the expected closing on 625 Madison?
Marc Holliday : You know, those assets are still very much in the plan in active negotiations documenting big deals. Big deals don’t happen quick nor you know do they need to be rushed but we’re confident in their outcome and you know in terms of timing I don’t know if we’ve given any guidance beyond this year. I mean, we hope to get them buttoned up sooner than later. Certainly OVA, which is more advanced. Second one you said was, did you say –.
William Catherwood : Yeah, it’s about 625.
Marc Holliday : 625 closing or that one’s in contract. Yeah. So, is the question there about closing timeframe on 625?
William Catherwood : Yes.
