Wissam Francis: So on the ERP implementation system, it’s basically a new system that we’re putting in to consolidate all of our GLs. The cost is — could be, again, depending on all the things that we activated, could be about $7 million to $10 million full cost. You can see that run through. In Q3, it was a little higher. Again, you saw some of that come through in nonrecurring G&A. You’re going to start seeing that dugdown probably by Q4, really getting into Q1 next year. Most of the investments has already occurred this year and including some last year, and you’re going to see very little on the investment front going forward. What’s going forward is really about creating efficiency and creating process improvement in the system. And you’re going to see some of that process improvement occur next year as we finish the implementation and really focus on stabilization of the system.
Jonathan Kelcher: Okay. So that will be mostly in the G&A then?
Wissam Francis: It could be a yes, partially yes, part of it would be in G&A, part of it would be really in compensation. What you’re going to see is you’re going to see as the company continues to grow, our overhead remains flat to stable to down. And that’s why we’re going to create the efficiencies that we talked about. Remember, our overhead is geared and we geared it towards 50,000 homes. And today, obviously, we’re short of that target, and we’re going to rightsize the company. As the company gets bigger, you’re going to see less increases through the overhead line item.
Operator: Your next question comes from the line of Jade Rahmani.
Jason Sabshon: This is Jason Sabshon on for Jade. So for my first question, what proportion of your customer base is multi-family a substitute product? Or does the apartment demographic have little overlap? So in other words, although performance has been resilient thus far, are you seeing competition from multi-family supply and slowing rent growth in the Sunbelt?
Gary Berman: I’ll let John take that.
Jonathan Ellenzweig: Yes. Jason, it’s a great question. We see actually very little overlap. And as we survey our residents and look at where they’re coming from, some of them might be moving out for multi-family, but in many cases, our residents aren’t shopping multi-family. And if you think about the nature of both unit sizes as well as locations, for the families that are moving into Tricon’s homes, it’s not really a perfect substitute. Multi-family is often located in more, let’s say, commercial oriented parts of cities or neighborhoods. And also schools tend to not be as strong as the homes that we’re buying. And so when we’re targeting school scores, let’s say, in the 5, 6 or 7, you can’t often find the same for multi-family with similar rents. So our residents are really looking at SFR only when we’re shopping.
Jason Sabshon: Got it. And as a follow-up, does it make sense to weigh incremental capital deployment towards self-development communities and targeting a more opportunistic return or to continue acquisitions at a more moderate pace until economics become very attractive?
Gary Berman: Probably, the latter. I mean, I think on a capital allocation, the best thing we can do as we talked about right now is our capital recycling program, which we’re doing, debt repayment and probably buying back some stock. That’s the right thing to do. On the development side, we’re just not seeing the yields that make it compelling, right? We’re buying homes off the MLS at a 6 cap. In order to make development, I think, [pencil in] and make it compelling, we probably need a spread to that of at least 50 to 100 bps, and we’re not seeing that, right? We’re looking at a lot of build-to-rent deals. We just can’t make the numbers work. So I think we’re in an environment right now where development doesn’t make a ton of sense. We have to be patient and acquisitions will be largely focused on existing homes when we raise the new funds, and also probably buying homes from builders.
Operator: [Operator Instructions] We’ll wait another moment for more questions. All right. There are no further questions at this time. I’d like to turn the call back over to Gary Berman, President and CEO of Tricon Residential.
Gary Berman: Thank you, operator. I would like to thank all of you on this call for your participation. We look forward to seeing many of you at the fall NAREIT conference and speaking with you again in February to discuss our Q4 and full year results.
