W. P. Carey Inc. (NYSE:WPC) Q4 2023 Earnings Call Transcript

Operator: [Operator Instructions] Our next questions come from the line of Joshua Dennerlein with Bank of America.

Farrell Granath: This is Farrell Granath on behalf of Josh in line. I was wondering if you could walk me through or elaborate on with the discretion and having kind of more capital on hand, would you be holding this cash and getting about like a 5.5% yield or paying down the 2024 maturity is at 3.5%.

Jason Fox: Yes.

Toni Sanzone: Gave a little color on that. Sorry, go ahead, Jason.

Jason Fox: That’s okay. Yes. So in the short term, if we haven’t deployed that capital in new investments, likely result in a little bit of delevering. But to your point, we can hold a lot of that in cash as well, given the returns that we can generate. I think the expectation is that we’ll be at the low end of our target leverage range for probably the first half of ’24, but we’re not planning to delever longer term. We’re still kind of targeting in the mid to high 5s on a net debt-to-EBITDA basis.

Farrell Granath: And I just wanted to ask about the 80 basis point decline in occupancy, is that being driven off of the bankruptcies? Or is there other aspects in that?

Jason Fox: Brooks, do you want to take that?

Brooks Gordon: Sure. No. The biggest driver is that warehouse. And so again, we’re actively working on that. But that’s really the moving part in the piece.

Operator: Thank you. At this time, I am showing no further questions. I’ll now hand the call back over to Mr. Sands.

Peter Sands : Thanks everyone for your interest in W. P. Carey. If you have additional questions, please call Investor Relations directly on (212) 492-1110. And that concludes today’s call. You may now disconnect. Thank you.

Operator: Thank you. That does conclude today’s teleconference. We appreciate your participation. You may now disconnect at this time.