Tayo Okusanya : A quick question on the guidance side. Again, very strong underlying fundamentals built in ’23. I’m trying to understand a little bit more about some of the kind of the drags on the numbers, if I may use that word, that results in the guidance. And specifically on the interest and FX side, trying to understand the FX assumptions being made and quantitatively how much of a drag that is on earnings this year, in case FX becomes better than expected? And also trying to understand the assumptions around the $500 million of refinancing that’s baked into the numbers, exactly what kind of rates are you expecting to refinance that at?
Bob Probst : Great. I’ll take that. So Page 14 of the deck we posted yesterday is helpful here because it really focuses on the impact of rising interest rates. Of the $0.16 I noted in the bridge, the vast majority is interest rates. And the vast majority of that is really the curve on floating rate that we see and show in the deck. FX is a contributor but a small contributor. And in large part because we have, in Canada, Canadian debt, and that’s a natural hedge to what is a stronger U.S. dollar, which is having translation impact on NOI. So that’s the primary driver. In terms of the $500 million this year of refinancing, again, that’s in Canada, principally. And we’ve been able to secure some attractive pricing on mortgages in Canada.
That’s going to be a key source of funds as well as some agency debt here in the U.S., which we’re planning to issue, which we’ll use to pay down floating rate debt. And those are really the two key drivers of the guidance in terms of refinancing.
Otayo Okusanya : And specifically for the $500 million, could you give us a sense of what the new rate is going to be versus the old rate?
Debra A. Cafaro : Well, I mean it depends on the 10-year.
Bob Probst : Yes, it depends on the 10-year. In the 5s would be a reasonable expectation, depending on where the 10-year is.
Otayo Okusanya : Okay, great. Pete, you’re giving me 2% to 3% MOB next year. Going down, but I still like it.
Peter Bulgarelli : We’re feeling good.
Operator: Our next question will come from the line of Nick Yulico with Scotiabank.
Nicholas Yulico : I just also in terms of the guidance, a question on the $300 million of capital recycling proceeds that you’re getting. If you could just give the breakdown on the loan repayments versus property dispositions in that number. And as a second on that would just be how we should think about your using those proceeds? I mean, are you earmarking for debt paydown, acquisitions or development? Any color there would be helpful.
Debra A. Cafaro : Nick, it’s Debbie. On the $300 million, a couple of hundred million as we show in the deck, is based on office dispos, some of which are purchase option-driven. There’s a — we got full repayment on a Freddie Mac loan in January, that was $43 million, I think, at a double-digit interest rate. We got paid in full on that. And then the balance is other small items.
Operator: Our next question will come from the line of Rich Anderson with SMBC.
