Greetings. And welcome to Empire State Realty Trust First Quarter 2017 Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Mr. Thomas Keltner, Executive Vice President and General Counsel at Empire State Realty Trust. Please begin, sir.

Good morning. Thank you for joining us today for Empire State Realty Trust’s first quarter 2017 earnings conference call. In addition to the press release distributed last evening, a quarterly supplemental package with further detail on our results has been posted in the Investors section of the Company’s website at empirestaterealtytrust.com. On today’s call, management’s prepared remarks and answers to your questions may contain forward-looking statements as defined in applicable securities laws, including those related to market conditions, property operations, income and expense. As a reminder, forward-looking statements represent management’s current estimates. They are subject to risks and uncertainties which may cause actual results to differ from those discussed today. Empire State Realty Trust assumes no obligation to update any forward-looking statement in the future. We encourage listeners to review the more detailed discussions related to these forward-looking statements in the Company’s filings with the SEC. Finally, during today’s call, we will discuss certain non-GAAP financial measures such as FFO, modified and core FFO, NOI, and EBITDA, which we believe are meaningful in evaluating the Company’s performance. The definitions and reconciliations of these measures to the most directly comparable GAAP measures are included in the earnings release and supplemental package, each available on the Company’s website. Now, I will turn the call over to John Kessler, President and Chief Operating Officer.

Good morning. We are delighted to welcome you to our first quarter 2017 earnings conference call. Empire State Realty Trust is a pure-play Manhattan and Greater New York metro area office and retail portfolio that offers a unique opportunity to grow income as we continue to redevelop and lease our properties at market rents and bring occupancies to market levels. Since inception, we have delivered and we expect to continue to deliver our embedded de-risked growth. During the first quarter, we continued to execute on our focused strategy and delivered strong results. We saw strong tenant demand for our value price point and well-located quality buildings as we signed approximately 201,000 square feet of leases during the quarter. With ESRT’s trademark ingenuity and tenacity, we concluded our redevelopment of the retail space at 112 West 34th Street, when we signed Target for a 43,000 square-foot lease. In our March 2015 Investor Day, when I’d been with ESRT for just one month, we presented the significant opportunity we saw in the conversation of a basement, ground floor retail and second floor office into 89,000 square feet of retail. Now, two years later with leases of Foot Locker, Sephora and Target, we have grown the revenue from these spaces from $2.2 million to $20.9 million. We continue to capture significant upside in rents, achieving average leasing spreads of 44% on all new and renewal leases across our entire portfolio and 22.4% on our new Manhattan office leases. Our Observatory experienced very unfavorable weather conditions and felt the effect of the calendar shift of the Easter weekend to the second quarter of 2017, yet revenues only declined 1.4% year-over-year. We continue to introduce new visitor options and improve the overall experience. In our broadcast operations, in the first quarter, we signed long-term lease…

Thanks, John. Good morning, everyone. On today’s call, I will provide an update of our four key growth drivers and review our leasing activity in the first quarter, giving up overview of our current and future space availabilities and discuss the timing of new lease commencements. As you know from our Investor Day in March of 2015, we set forth our four key growth drivers from our existing portfolio. At that time, we presented revenue growth of $90 million to $100 million from these four growth drivers over the following five to six years. Since January 2015, when we exclude the contribution to NOI growth from the Observatory and adjusted for the mid-2014 acquisitions of 1400 Broadway and 111 West 33rd Street, we have delivered $56 million in cash NOI growth. This is net of the loss of income from the vacancies we create through our redevelopment and re-leasing program. As David Karp will discuss more in his comments, we are now including disclosure of the annual rent from leases that have commenced but are in their free rent period. Once the free rent period is over, these leases will contribute to cash NOI, but until then, we will track them in signed leases, not commenced. Previously, we did not provide the future contribution to cash NOI from leases that have commenced that are still in their free rent period. Our first quarter numbers reflect further progress on our four key growth drivers, which are one, upside from signed leases, not commenced of $4.5 million and the burn off of free rent of $35 million, which together total approximately $40 million of growth from this driver; two, lease-up of developed vacant office space of $40 million; three, the mark-to-market on our expiring Manhattan office leases of $21 million; and four,…

Thanks, Tom, and good morning, everyone. I’ll start with the review of our financial performance, discuss some new disclosers, revisit Tom’s discussion of our four drivers, and follow with an update on our Observatory operations and balance sheet. For the first quarter, we reported core FFO of $61.3 million or $0.21 per diluted share. Cash NOI was $82.8 million, up 8.2% from the prior year period. Certain other revenue and fees, and property operating expenses affected our first quarter FFO. We recorded $7.9 million in lease termination income we generated from two departing tenants, one at each of first Stamford Place and 250 West 57th Street where we have already re-leased the entire four floors to partner PartnerRe and Mount Sinai, respectively. Straight line rent receivables associated with the terminated leases were reversed, and this reduced rental revenue by $1 million. We had a decrease in the year-over-year tenant expense reimbursements due to lower electric reimbursement and a decrease in our estimated build expense reimbursements driven by updated base years for new and renewal leases. We incurred higher property operating expenses year-over-year, primarily due to $1.9 million for repair expenses related to the Empire State Building elevator shaft modernization that was accelerated during the first quarter to avoid disruption to the Observatory during the Easter holiday with the remaining balance coming from ordinary course repair and maintenance. Since January 1, 2015, we have delivered approximately $56 million in cash NOI growth from our office and retail leasing performance. In addition, we have delivered approximately $15 million in NOI growth from our Observatory performance. Finally, we estimate our updated four key growth drivers will deliver approximately $110 million of revenue growth over the next five to six years relative to our trailing 12 months cash NOI of $362 million. As Tom…

Thank you. [Operator Instructions] The first question today comes from Jamie Feldman of Bank of America. Please go ahead.

Tom, I was hoping if you could just provide more color on the leasing market and what you’re seeing today, and may be the pipeline of tenants looking at space. And then, also, how you think the portfolio fits in versus some of the new supply we’re seeing come on line in your leasing discussions?

Sure, Jamie. I got to say, I feel really good about our deal flow, really good about our pipeline, the activities that we are seeing. And I would say that look -- hats off to our leasing team on the Target lease; they just actually crushed it with the re-lease of that 488,000 square feet at the base of 112 West 34th Street. The fact that we went from $2.2 million in aggregate rents to nearly $21 million in the current retail environment, I think we just killed it. On the other side, I feel good about our pipeline, I feel good about the activity. We have leases in negotiation or advanced discussions on fourth floors at 111 West 33rd Street, Empire State Building, One Grand Central, 1400 Broadway and advance discussion on our multi floor deal 250 West 57th Street. We have activity where we have available prebuilts, primarily at Empire State Building and at One Grand Central. So, overall, we feel good about where we sit, feel good about the activity that we are seeing. And in terms of how our portfolio fits within -- compared to maybe the new development, I would say first of all, I’m really happy that we own the portfolio that we do. I’m particularly glad that we don’t own aged, 50-year old Class A property. The location, the work that we’ve done with the redevelopment, how our properties show and the value price point, I think is all coming to our favor. As it relates to the new development, as I said in the past, we’re providing a great value, a choice for tenants that can choose to go anywhere, but they come to our portfolio, because they are getting great access to mass transit at a really good price point, newly built office space in buildings that have been fully redeveloped. So, I like our competitive advantage of new development.

Okay. And then, I guess to dig deeper on the leasing pipeline. Is there any shift in the types of tenants looking at space or any trends you’ve seen maybe post-election in terms of demand for your portfolio?

We’ve always liked the diversity of the tenants and the industry types that we attract and to whom we lease. In the first quarter, I can’t say that there was any significant change in that diversity. We leased to tenants in professional services, healthcare, fire sector, technology, you name it. It was really again a wide range of industries and tenant types to whom we lease. I can’t point to any significant case. But, I’ve always liked that about our portfolio. We attract a wide range of tenant, industries and we’ll continue to see that going forward.

The next question is from Craig Mailman of KeyBanc. Please go ahead.

Hey, guys. Good morning. David, just a clarification. It seems like between the change in revenue recognition methodology and the accelerated kind of spend on the elevators at the Empire State Building, it seems like that was almost a penny of cost with three quarters of that kind of pulled forward from other parts of the year. Is that a fairway to look at it?

Yes. Craig, the elevator shaft repair work, which we accelerated into Q1 to avoid any disruption at the Observatory was approximately $2.5 million. And then, with respect to the revenue recognition, that impacted our top line revenue by roughly $500,000.

Okay. So, was the full penny in that $2.5 million was just slated for either 2Q or beyond, so that margins should get a little bit better in the coming quarters?

Yes. On the elevator shaft repair work, we still have some remaining work to do there, considerably smaller amount, less than a third of that $2.5 million. And again, we’ll probably concentrate that in Q1 of 2018, again to avoid any disruptions.

That’s helpful. And then, Tom, nice update [ph] on the Target leased on. I’m just curious and looking at the kind of the mark-to-market there, relative to Sephora, it looks like maybe the ground floor came in roughly at 40% plus discount. And I know two years ago and you had the ground below grade space to lease here. I’m just curious, as you guys were kind of moving between tenants and kind of the decision here to go with Target, which maybe the credit deserved to discount rent versus maybe some other tenants?

I don’t view it as a discount rent. Yes. Craig, I don’t view it as a discount rent. The total aggregate rent that we achieved which is nearly $21 million is absolutely consistent with our prior expectations. As you go back to some of the earlier calls, I was even targeting -- forecasting between 18 to $20 million. So, we did a fantastic job in the execution here; delighted to have Target. I think you are trying to compare different spaces, right? Sephora has the largest ground floor presence and the most -- the greatest amount of frontage on 34 Street. They have the most valuable space. Foot Locker is different to Target. They have the entire second floor space, as you know. And then, Target as you know took that lower level space and ground floor. So, again, the outcome is consistent and even outperformed some of our earlier expectations, but certainly within the range that we thought we would achieve.

That’s helpful clarification there. And then, just lastly, the acquisition market, you guys are still sitting on 500 plus million of cash. Curious what you guys are seeing in the market, and maybe just update us again on what areas of the city you guys would be interested in, and if there is any parts that are less interesting to you versus more interesting, maybe just some updated thoughts.

For starters, just to remind you that for the next couple of years, we don’t -- our business doesn’t need to make acquisitions to grow our NOI, given the significant embedded growth that we have. From our comments earlier from David and Tom, we’ve got a $110 million in NOI growth coming on top of the in place NOI. In terms of the market environment that we see, certainly we think it continues to be very competitive and the results that we saw at 245 Park are an example of that. In terms of markets that we like, I think we continue to like the markets that we are in.

I would just add. It’s Tony here. It’s Thursday morning, right? It is Thursday morning, isn’t it? It seems like everybody had three weeks this week. And by Thursday morning, I’ve already had in-person on the phone or over email four conversations with four different parties, with regard to M&A activities on which we are working; none of those is the high probability at this juncture, but they all represent things that we think make sense. They are all big picture at longer term; every single one of them makes absolute sense in our view for the other party. But people have different motivations and different thoughts. So, while we have this built-in growth, and come on guys, $110 million of additional drivers, this is in our sweet spot, based on today’s markets. In addition to that, we’re working very hard but we’re being super disciplined. And we’re not going to do things which aren’t in the best interest of shareholders, just for the sake of showing growth.

[Operator Instructions] Our next question comes from John Guinee of Stifel. Please go ahead.

Three quick questions. First, looks like Manhattan office numbers are very, very pleasant but the Greater New York office portfolio re-leasing is 11% cash rent roll down despite a $69 re-leasing package. Is that typical of suburban or Greater New York office leasing?

John, first of all, I’d say that I’m very pleased with the execution on the lease to PartnerRe, similar to the Mount Sinai lease. We seize an opportunity to recapture space from an existing tenant, physically vacated space was going to hook for rent, secure termination payment, re-lease space to a new credit tenant for long-term, avoid downtime and lease to a tenant that’s prospect for growth. So, we’re really going to take advantage of the situation like that. Second, we have very little rollover in the coming year, only about 46,000 that’s rolling in the coming year. We did have some modest rollout during the first quarter, so our lease percentage is now 91.3% leased but with only 46,000 square feet rolling in the coming year and activity in the pipeline, I feel very good about where we’re at. The TI concessions are going to vary, depends on the condition of the space, we have some smaller builts, second gen prebuilts, some are first gen prebuilts and we have -- and some of the larger lease are going to command the higher TI concession packages, all depends on the overall geo-economics, the rents, length of term, free rent and every rent. So, I can’t say that there is one typical concession package that fits all; it varies by particular space and particular geo-economics.

John, I would also like to say that, we do know that your name is Guinee

Okay. Thank you. Second, on your retail lease with Target 43,000 square feet just under a $100 a square foot, is that a net lease or is there a gross component to that? And then, second, what was the concession package TI, leasing commission, moving costs, et cetera on that deal?

It’s a gross lease. There are rent bumps, increases in base rent over the length of the term. So, what you’re calling $100 square foot is a starting rent; it will increase over the length of the long-term. We also have real estate tax escalation pass-throughs over a base year. With regards to concessions, without divulging the specifics for confidentiality reasons, I would say that we’ve always said that retail concession typically range somewhere between the 47% total concessions as a percentage of aggregate rent over term. This was in the kind of 4% to 5% range between free rents and TI, so relatively low concession relative to the base rent.

Okay. Is this a 20-year lease?

Yes.

Okay. So basic…

Just under 21 years. Sorry, John. Just under 21.

So, if we take $100 times 21 years times 5%, you get the concession package?

Well, you’ve got to add in the bumped over term, which we haven’t quoted, but there are bumps in base rent over term.

Okay. And then, the last question. Looking at the Manhattan office lease, 85,000 square feet, up 21%, up about $10 gross; if you’ve factored in the reset on the OpEx, maybe David Karp, and you look at the previous OpEx costs versus the new reset, what sort of increase would you be getting on a net rent basis? Any idea; do you guys have that number off the top of your head?

John, we don’t, but we’re happy to take a look at it and I can get back to you offline with the response.

The next question comes from Tom Lesnick of Capital One Securities. Please go ahead.

Hi, guys. Thanks for taking my questions. I guess first, it looks like there was a marketed asset in Stamford in the last two months. I know you guys can’t talk about that one specifically, but big picture. Do you guys have any interest in expanding the portfolio beyond Manhattan; how are you guys thinking about the Greater New York region overall right now?

Well, I think as Tom just went through, our assets there continue to be steady; we like what we own. We think about the expansion of our business. That’s not a market that we are focused on growth.

Just adding to John’s thoughts. We are very clear on what we said when we went public and with our -- we’ve been consistent throughout. We really view ourselves in this market -- we are primarily a New York City, Manhattan based business proposition. It is not to say that if other things came along with it or if there were something which were strategically compelling, we wouldn’t really reconsider. But strategically compelling to us is not a small term; it’s really -- it’s big, it’s important. We are fortunate to be where we are. I often joke that if my family had settled in Cleveland instead of New York City, we would not be on the phone with you right now. So, we are good where we are. And I think that it’s very difficult to consider going out of its territory where we have expertise and there are so many opportunities and complicated ownership situations to which we can add benefit through our balance sheet and our ability to figure complicated things out. There is a lot of opportunity here. Not ruling something out if it came along with the package but it’s hard for us to consider. We’re going to go do something which opens up a West Coast based -- exclusively with a West Coast based company; it’s kind of hard to envision that from where we are.

No. I certainly appreciate that. And as to my second question, I understand obviously that Easter fell in second quarter this year and that there were one fewer days overall in 1Q 2017 versus 2016. But as you look at where bad weather fell in holidays, it does appear that both MLK and President’s Day in 2016 experienced some bad weather. So, just wondering big picture, how you guys attribute sensitivity to each of the holidays with respect to visitors…

Okay, let’s be clear. A couple of things; I appreciate the question; it’s going to give me an opportunity to say a number of things on the Observatory, which I wanted to say. David mentioned we always look at things holistically over a 12-month period; that’s for sure. Number two, President’s Day, MLK Day, these are not school holidays. Easter typically tracks for the United States and in countries which have a major Christian population, a one week holiday. So, we look at the Easter Sunday and we bracket that on either side with two weeks of business. So, to be clear, the reality of our existence in March was pretty terrible. There is nothing we could do about it. When you can’t see the top of the building, you can’t see the top of the building. On the snow storm on the 14th, they shut down the day before by around noon in New York City, 2’o clock for offices; flights were canceled starting on the 24 hours priors to that. I was one of two people in the office on the 14th. It was kind of nice because there was absolutely nobody on the streets because all transportation was either shut down or had been disclosed that it was about to be shut down. And then, three days after that weather experience, traffic was still screwed up on the New York City streets, specifically Manhattan as frontend loaders and dump trucks were being used to dig out frozen piles of snow that had been pushed through the side, everything froze. The weather stayed cold. This was a massive disruption. So, when we look at this, I would just look at the weather -- and we had one of these, we have these from to time-to-time, we had them in January. The good news is, hey, without Easter, first quarter is not a big quarter for us. That’s why we compressed so much of the shaft work in the Empire State Building elevators in that period, because it’s the least disruptive time in which to do it. And Easter is not the same as we experienced for MLK or President’s; you really have to think about Easters almost like -- it’s bigger than Thanksgiving; it’s almost like a Christmas to New Year’s holiday period. That’s big business for us.

Got it. That’s really interesting. And I certainly appreciate the color. Thanks, guys.

Our final question will come from John Kim at BMO Capital Markets. Please go ahead.

Tony, on the M&A discussions that you had this week, were these conversations based with USD [ph] acquirer and also are you sensing that bigger picture M&A activity will pick up this year?

Well, I think there is -- first of all, to your -- the second part of your question first. There is no question that with the discounts, which most REITs are trading to NAV and we know what we think our NAV is but it’s always interesting to see the Street establishes insights NAVs based on other underwritings. In general, selling shares to buy stuff at market is not a thrilling proposition I think for anybody. So, I think M&A is something which there is a lot conversation today in general; that’s thematic. Number one. Number two, in our activities, I’ll be very blunt. I was look at it from a perspective that I personally, my family generally has a huge stake in this business. And at the same time, I’m an investor. I’ve always been an investor. You guys may know, I started out in a private equity business. I don’t think that -- we’re not here to perpetuate our position the top of corporate structure. We’re here to deliver the best results for shareholders. But for me to give up control of our balance sheet, it has got to be with somebody and whom I or a management and whom I personally selfishly as a shareholder have a tremendous degree of confidence because I’m going to be living with those results for a significant period of time, at least if I’m fortunate. But I would say that the discussions out there for this particular week have all been more in the spirit of partnership rather than in the spirit of sale or in the spirit of acquisition, on the spirit of partnership.

Is it fair to say that you’d be comfortable operating as either public or private entity given the industry?

I’m comfortable about the predictability of future cash flows and the opportunity that compounds value in the most tax efficient fashion possible. That’s what gives me comfort. So, if your comment is would you sell for cash, the number one comment in my mind there is what is the most effective pre and post tax result we can deliver for shareholders and I’d say that specifically; our responsibility first and for most is to shareholders. We do have a lot of operating partnership to unit holders. We’re very clear on what our responsibilities are to them but our focus is specifically on what is best for shareholders; that’s our requirement; that’s our mandate; that’s our focus.

Okay, great. Thanks. Earlier this year, the New York City -- tourism arm in particular, the international visitors into New York would decrease this year due to Trump’s travel ban. I’m wondering if you’re seeing that at the Observatory.

First of all, I think it’s too early to say. Again, I would just tell you that absent March, we were having a wonderful time at the New York City as number one iconic attraction, the Empire State Building. So, I think it’s too early to say. I do believe that you can’t separate the politics from the situation. New York City has been labeled a Sanctuary City, self labeled a Sanctuary City. The NYC & Company is a department for a lack of a better word of the New York City government, it’s run by Mayor de Blasio. Mayor de Blasio has -- his administration have a view about the politics in DC. I can’t imagine that view does not have something to say on the matter of the ban, travel ban. But it’s very clear that we absolutely have a concern about the publicly reported incidence, for instance Canadian school trips changing their destination to other locations than the United States, countries that have more diverse populations, more accessible immigrating than the United States, which allow people with other passports to live within their borders more freely, having a concern about how those people might come to the United States or not based on their concern of if something were to happen, would they be deported from the United States to Somalia, instead of back to the United Kingdom. But all that being said, we do take some comfort in the fact that aside from the PR bruise that the U.S. takes in the public opinion, we do have this issue of not too many people from the countries in question, our visitors to the Empire State Building Observatory, So that may impact numbers overall. Our customer base but that doesn’t really rate.

Okay. And then, a final question perhaps for David. The mortgage at the Empire State Building expires about a year from now and I’m wondering what your plans as far as refinancing, particularly in light of the reason refinancing JM Building?

John, there is no mortgage on the Empire State Building.

Okay.

You referenced another property?

Probably, I’ll take it offline. Thank you.

Okay.

We will take a follow-up from Craig Mailman of KeyBanc as our final question. Please go ahead.

Hey, Tony, just to follow up on the M&A discussion here. You guys sold a big chuck of the Company to QIA last year at 21 bucks. At that time, it sounded like it was more strategic partnership and maybe the $21 wasn’t a reflection of where you thought your NAV was trading. But just given kind of the upside that you guys have over the next five years on NOI basis, just kind of your thoughts on maybe what you guys view NAV vis-à-vis kind of the decision to maybe be opened to some type of partnership with another public or private equity firm here and kind of how you view that the opportunity set for your existing shareholders versus what you will need from the partner side in terms of upside and quality and all of the things that you guys hold near and dear?

Well, I would just say that with $1.6 billion of readily accessible capital, we feel that we’ve got a level of comfort as to the ability to act on anything really out of things that might be interesting to us. Number one. Number two, we absolutely view our relationship with our new largest Class A shareholder as fundamental. We maintain that relationship; we have open dialogue with them on a regular basis; and we still remain very pleased having them as a key shareholder. And as for the last piece, I really don’t know how to react other than to say that. Our view was that in the world of raising capital for flexibility, we did not want to shrink our balance sheet; we wanted to grow our balance sheet. And selling out a piece of a property on a joint-venture basis to me was moving us into the land of smaller REITs that simply I think at the hard time justify being independent companies. And clearly from our perspective, we are motivated keeping in mind that we’ve got a $110 million of additional growth that we think we’ve laid out pretty clear in our four drivers. So, we will obviously think we are a much bigger company than for which people give us credit. But the bottom line is as far as our ability to grow and where we see the value, it’s all about the long term. Said before, our good decisions, our decisions that look in 10 years, seven years, five years, four years, I’m not so concerned about quarters one, two, three or four after we make a decision.

I will now turn the call back over to Mr. Malkin for closing comments.

Do we have one another -- I think we have one more follow-up from Jaime Feldman.

Oh, yes, sir. He just came in the queue. Mr. Feldman from Bank of America, please go ahead.

Thank you. I apologize if I missed it. But, can you talk about just your thoughts on the health of street retail and your 34th Street Broadway corridor.

From who do you want to hear? You’ve got a large group of people in this room who would be happy to comment on that. Tom, go ahead.

Jamie, this is Tom. Again, I can’t be more pleased than with the execution on the leasing of 88,000 square feet on 34th Street bringing the aggregate prior in-place rent in April a year-ago from $2.2 million to nearly $21 million, achieving 840% mark-to-market in the current retail environment. We’ve leased up all of our Broadway frontage in Time Square South, leased up all of our 57th Street retail. And what remains is some side street space to lease which candidly will bring in likely food to provide service and amenities to our office tenants and a newly available space at the base of Empire State Building and it’s early in the marketing of that. So, I feel very good about what we’ve accomplished to-date, the amount of leasing that we’ve done, and it feels like we’re in a really, really good position. And I have absolute confidence in the ability of our team to execute. But let’s talk to the larger issue, Jamie. There is no secret here. Anybody who says that retail is not materially challenged is either deeply, deeply in need of psychotherapy or needs to get out from under a rock. There is a fundamental reality that I think possibly driven to some degree by landlords that are forcing retailers to look at different ways to do business, smaller stores, reduce the number of stores because they can’t make money at these rents. They are under pressure. We’re fortunate, on 34th Street, there is a reason that Sephora Foot Locker and Target are leased with us because that’s a high traffic location. Those people are leasing their rents that allow them to make money. Those are going to be successful stories. You’re not going to read a story like the one about Lauren and Polo. We’re one of those stores that go close in 18 months, Sephora is thrilled there, Food Locker’s thrilled, Target is going to be thrilled there. They’re going to do tremendous business; Sephora and Foot Locker already are.

This is Foot Locker’s historically -- this has been Foot Locker’s number one performing store and Sephora expects this would be their top performing store in the U.S. So, this is a great location.

So, you look around at the rest of where our retailers, same story. But in general retailer is retrenching and a lot of it is -- I’ll leave you with one last thought. When you look at what’s happening in class A trophy office buildings right now, the old ones are losing tenants to the new ones and they are both counted as occupied. That artificially inflates the occupancy and the actual performance of the Class A trophy office environment in New York City. Same thing with regard to retail. There are a lot of retailers right now who are serving prison sentences. They can wait for those leases to be over, so they can get out of them. And there is going to be a meaningful development just on Harold Square, not involving Macy’s, which already know about because of our knowledge of the marketplace, which will further highlight how much things are changing in New York City. And I would just tell you that we consider a great success on 34th Street, but we also consider it’s going to be a great success for our retail partners and the long-term viability of these locations that we’ve got. We’re happy about them.

And then if you do start to see real pricing weakness in retail, would you be interested in value investing [Multiple Speakers] your business.

100%.

Which corridors would you be interested in?

The ones where we see the best value over the long-term. Sorry. I think we’ve probably kept everybody a really longtime. Jamie, do you have any further follow-up? I don’t think we’d give any more specificity on that particular question.

No. I’m all set. Thanks.

Thank you all very much for joining us. John and I, we’re really happy with the team’s performance. I can’t say how happy we’re with what we see in our ongoing solid business fundamentals. We’re glad we are fully modernized with the 21st century portfolio and our locations and at our price points. And we look forward to finishing up Q2 and reporting to you all in three months. Thank you all very much for joining us.

This concludes today’s conference. You may disconnect your lines at this time. Thank you for your participation.