And we have not seen any diminution in interest as rates rise, obviously, the embedded debt becomes more valuable on a mark-to-market basis. And the lease stream is unaffected. And I don’t think you can make any extrapolations as interest rates or cap rates 10 or 15 years out? I guess you could, but it would be conjecture. So in that way, the building is well insulated as any. And we’ve had great reception and we’re hoping to be able to conclude something there.
Operator: Thank you. One moment for our next question. Our next question comes from the line of Caitlin Burrows from Goldman Sachs.
Caitlin Burrows: Maybe just on the occupancy front, you mentioned earlier in response to the guidance question. The various parts of the business are going better than expected. It does seem like to meet the occupancy target for the same-store Manhattan portfolio, you need a significant pickup in the fourth quarter. So just wondering, based on where we are today and the visibility that you have kind of the outlook for occupancy increasing materially in the near term?
Matthew DiLiberto: Yes. So we had a very heavy goal of north of 92%. We will not make that goal. Marc alluded to in his comments that we have a good pipeline, we’ve already done 1.3 million square feet of leasing. We have 1.1 million square feet of pipeline, but deals are taking longer to get done. And therefore, the occupancy is picking up but at a slower trajectory than we had anticipated. So we do expect it to pick up into ’23 and into ’24 as we close on the pipeline, but we will be short of the 92% that we had laid out at the beginning of the year.
Marc Holliday: Yes. And I just want to be clear on that. That I know it’s — maybe it’s too nuanced, but what we have internally projected versus what our goal is that we set for ourselves and what I call stretch goals, the 92-point whatever was ambitious goal to get to 7.5% occupancy in a market that’s 18% vacant — I’m sorry, 75% vacant in the market that’s 18% vacant. Obviously, in doing that, where we’re trying to be realistic, but we’re trying to push ourselves. I said anywhere from, I don’t know, 18 to 20 to 21 goals a year and if they were all projected or tapping, we meet them all every year. And in fact, we generally meet anywhere from about 60% to 75% of those goals, that’s by design. So the fact that, I think as we sit here this year, our occupancy is trending up and will be in the 90s.
We’ll have to see where we cross the finish line at a point in time on December 31 is an amazing achievement in a market that otherwise has been relatively flat on vacancy at around 18% throughout the year. And I do think the pipeline is more telling than where we are exactly at December 31 because what it’s saying is we’re going to have a big December, January and February because we have a 1.1 million square foot pipeline. And typically, those deals take three to five months to close from the time they’re in that pipeline. So it sets up really well for next year. So I know how it works and the headlines are going to be, well, SL Green Gold 92, and they come in at 90-point-something or 91, who knows. But the reality is — it’s all about the trend, it’s about the pipeline and it’s at our confidence that we bottomed out in vacancy in the second quarter.
