Greetings and welcome to the Empire State Realty Trust Second Quarter 2022 Earnings Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. As a reminder, this conference is being recorded. It is now my pleasure to introduce Tom Keltner, Executive Vice President and General Counsel. Thank you. You may begin.

Good afternoon. Thank you for joining us today for Empire State Realty Trust second quarter 2022 earnings conference call. In addition to the press release distributed yesterday, a quarterly supplemental package with further detail on our results and our latest investor presentation were posted in the Investors section of the company's website at esrtreit.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, capital expenditures, income expense, financial results, and proposed transactions and events. As a reminder, forward-looking statements represent management's current estimates. They are subject to risks and uncertainties including ongoing developments regarding the COVID-19 pandemic, 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. Certain of our disclosures today are added specifically in response to the SEC's direction on special additional disclosure due to the changes in our business prompted by the COVID-19 pandemic and are unique to this instruction. We do not expect to maintain the same level of disclosure when we resume normal business operations. During today's call, we will discuss certain non-GAAP financial measures, such as FFO, modified and core FFO, NOI, same-store NOI, cash 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 Tony Malkin, our Chairman, President and Chief Executive Officer.

Thanks, Tom, and good afternoon to everyone. We are pleased to report our strong second quarter and first half of the year. ESRT's top priorities are the lease space, sell tickets to the Observatory and achieve our sustainability goals. Through all of that we will enhance our shareholder value through pro – active portfolio management and capital allocation. ESRT is well positioned with a modernized portfolio that takes advantage of the flight to quality, signed leases that will contribute to earnings and a strong and flexible balance sheet that allows us to take advantage of investment opportunities. We are a great way to play in New York. City's upside with our revenue streams from office, tourism, residential and retail and there's no doubt about it New York City is busy again. International tourists have returned and their numbers are growing. Seats on planes to New York City in the second quarter reached 87% of second quarter 2019 levels and hotel demand is up. Foot traffic nears pre-pandemic levels and many of the neighborhoods that surround our portfolio. We are well positioned with modernized buildings, close to mass transit with great amenities and more to come. At our industry leadership and energy efficiency and indoor environmental quality and we have a very attractive set of buildings with a tremendous pricing advantage. If you want to see some great independent validation of how the market values our portfolio, I encourage you to view the new video by our largest tenant, LinkedIn, on Slide 6 and our updated investor presentation. In fact, there are several new videos you can view in that new presentation. The Empire State Building Observatory rated by Tripadvisor as the number one attraction in the United States and number three in the world is strong. We have already passed…

Hey, thanks, Tony. And good afternoon, everyone. We have said for some time that we benefit from flight to quality, which we provide at a great price point with modernized energy efficient and healthy buildings, newly built tenant spaces with indoor environmental quality at convenient locations, with excellent access to mass transit and fantastic amenities to which we will add. We had great results in our portfolio this quarter, including over 320,000 square feet of total leasing major lease expansions by existing tenants and a 25% increase in net effective rents in our Manhattan office portfolio in the second quarter year-over-year and 16% increase sequentially. Overall leasing volumes were consistent quarter-over-quarter this year marking significant improvement from the environment we were in one year ago. In the second quarter, we signed 37 new and renewal leases totalling approximately 320,000 square feet, which includes 260,000 square feet in our Manhattan office properties, 57,000 square feet in our Greater New York Metropolitan office properties and 3000 square feet of retail. The weighted average lease term increased to ten years this past quarter, which reflects our tenant's long-term commitments to our modernized healthy transit oriented portfolio. Notable lease assigned of this quarter include a 59,000 square foot expansion lease with iCapital for two full floors with a term of over 15 years at One Grand Central Place. This is iCapital’s fourth expansion at One Grand Central Place and it now leases a total of 141,000 square feet across six full floors in a long-term lease. A 35,000 square foot expansion lease with Burlington Merchandising Company for a full floor with a 15-year term at 1400 Broadway, where Burlington now leases 103,000 square feet, the expansion space was formally under leased to Uber who paid us a termination fee upon their early exit from…

Thanks, Tom. I’m pleased to provide comments on what was a solid quarter that emphasizes the strength of our portfolio comprised of quality office assets, the Empire State Building Observatory, the number one attraction in the United States. Our strong everyday retail assets with 95% national retail tendency and are well located, well-amenitized, multi-family assets. For the second quarter of 2022, we reported core FFO of $79 million or $0.29 per diluted share, which compares to core FFO of $49 million or $0.18 per diluted share for the second quarter of 2021. Notably core FFO this quarter includes $0.07 of lease termination fee income, which was not contemplated in our prior guidance range. Same-store property cash NOI, excluding lease termination fees was down 7.1% year-over-year. This is primarily due to the normalization of operating expenses amid higher building utilization, as well as the impact from the occupancy loss of GBG in late 2021 as assumed in our 2022 earnings outlook. For the second quarter of 2022 observatory visitation was in line with our hypothetical forecast of 60% of 2019 levels. While observatory NOI at $19.6 million was approximately 80% of 2019 levels, reflecting our progress in higher revenues per cap. Second quarter NOI was up significantly from $3.1 million in the second quarter of 2021. We feel confident in the past back to pre-pandemic levels of performance. As a reminder, the observatory historically contributed roughly a quarter of the company’s NOI and stands at approximately 9% on a trailing 12-month basis through the second quarter, but is steadily building back and based on our 2022 full year guidance, we expected to reach roughly 20% of NOI. As we look at our significantly discounted share price today, we believe this upside is not fully appreciated by the market. Turning to our…

Thank you. We will now be conducting a question-and-answer session. Our first question is come from the line of Steve Sakwa with Evercore ISI. Please proceed with your questions.

Thanks. Good afternoon. Tom, I was wondering if you could provide a little bit more color and detail around the leasing pipeline. And maybe talk a little bit about the new versus renewals and just where the tenants are coming from the industries. And to the extent that they are new, are they looking to expand contract or roughly stay the same?

Sure, Steve. We’ve got a good pipeline of activity going into the third quarter with tenant prospects in a variety of industries that ranges from professional services, fire sector, legal healthcare, some tech and some consumer products similar to what we’ve seen in the past, our portfolio attracts a wide diverse range of tenant types and various industries. You may have seen, we just signed a 30,000 square foot lease for an expansion of a tenant that moved out One Grand Central Place into our 501 Seventh Avenue for full floor of 30,000 square feet. We have about – roughly about 160,000 square feet of new and renewal activity for leases in negotiation. So this is aside from proposals for which we’re exchanging paper, but these are actual leases in negotiation and includes about a dozen or so pre-built, that’s a mix of new and renewal tenants. And also includes a sizable renewal of a multi-floor tenant in our Times Square South portfolio. We’ve got a couple of expansion deals at Empire State Building one of about 15,000 square feet, another new deal with a credit tenant of about 15,000 square feet of 1359 Broadway. So we’ve got a mix of good activity. Of course, all this follows on the heels of a really solid quarter of over 320,000 square feet of total leasing activity, which is a really solid performance by our leasing team. We did an outstanding job and achieved a weighted average lease term of 10 years. So I think we’re in really good shape. There’s a lot of great things happening, a lot of great things that we’re doing and with the expansion of our amenities that I commented on earlier, a lot of fantastic things happening at the Empire State Building. You got to look at the videos, look at that LinkedIn video that Tony mentioned and looked at the videos about the expanded amenity offerings, both the Empire State Building and in our Broadway Plaza campus.

Great. Thanks for that color. Maybe Tony on the Observatory, is there any color you can just provide on the mix of tenants between say domestic and international? And what is your expectation for that mix going forward? And how might that impact kind of per capital pricing in the back half of the year?

Okay. I just – I think you meant visitors and I’ll answer it as mix of visitors. Look, first of all, we’re thrilled to be able to be able to share the quarter with you folks. Strong leasings, strong performance from the observatory, really firing on all cylinders, our residential has done well. We typically, as you know in the past have seen a larger percentage of international visitors versus domestic visitors. That international component continues to grow. And as that international component grows and as visitorship in general at the observatory grows, we’re having a very good week this week. What we see is a higher percentage of participation in past programs and people who come in through our tour and travel partners. That said, on a revenue per cap even with comparable blend to what we have seen in the past, we are much higher. Though there is some dilution by the fact that more people have come in through our – as we have said, would happen over the prior quarters through our past progress and tour and travel partners. I really think that we have yet to see the full force of the observatory visitor from overseas. I think there are really three factors, which come into play. One, I think that they’ve really botched the reopening. Everyone can see they’ve botched the reopening of their airports. I think it makes internal travel in the United States look like a dream. As the August travel season declines over there, we expect to see more people able to travel in September, who are our typical visitor who come in off season. Number two, I think with the fact that the dollar is strong, people will focus more on the authentic experiences out there. We’ve already seen a…

Great. Thanks. That’s it for me.

Thank you. Our next question comes from the line of Michael Griffin with Citi. Please proceed with your questions.

Thanks for taking the question. Just wanted to ask on guidance. It seems like it implies a deceleration into the back half of the year, and I’m kind of curious if you can give some additional color on that. Maybe it was from the expense side or anything you can add there that would be helpful.

Okay. Thanks for the question, Michael. So in our earnings release on Page 5, we actually lay out a key assumptions table. And what we outline there is we expect operating expenses to go up by about 10%. And if you look at the numbers in the first half of the year we’re at sub that level, right? We’re around 7%. So that implies a ramp up in the back half. So that will have some impact. And other areas, we do have a recovering observatory, but we also have expenses trending a bit upwards there as well from $7 million a quarter in the first half to $8 million to $9 million a quarter in the back half as we continue to ramp up that portion of the business. So you could see overall we expect very clear results across the business that we reiterated. But we do have some expense picking up in the back half.

And Griff I might add one additional point, and that is that as occupancy increases our costs of operation of our properties, we need to provide more services. For instance, we have materially expanded the hours of our gym at the Empire State Building based on demand and increased membership. So as we look at the amenities we operate and at the services we provide and the number of square feet we have to clean, it depends on occupancy – building occupancy. And as that building occupancy has continued to grow those expenses grow.

Great. So it appears to be just like a timing issue, more so than anything just given the beat and no change in guidance kind of adjusting for that lease termination income.

Correct.

Okay, great. And then my next one was on, just the multi-family portfolio. Obviously you guys entered it early late last year. And we’ve seen reports about other apartment guys in New York kind of lightning their exposure. I’m curious why it would make more sense to add exposure there? and maybe any additional color, I think Durels touched on it a little bit, but any color you could give there as why it might make sense to add more multifamily to the portfolio would be appreciated.

So thanks, Griff. First of all, we’re very pleased with the performance of the multifamily properties so far. The demand environment in New York City is strong and the occupancy at our two properties increased again this quarter. And we continue to see strong mark-to-market increases and reduce concessions in outside broker commissions. The rationale for our investment in multifamily, look, it’s consistent with our previously stated focus on New York City office retail and multifamily assets. And we do need to look at the fact that we are a New York City play. We are office. We are destination attraction. We are multifamily. We are retail. And we don’t play in other markets. We play in this market. Within this market, when we look at multifamily, when we have an opportunity to trade out of assets, where we see the opportunity to perhaps sell properties that are better suited to a new owner and we can exchange for more efficient cash use and growth that that’s something, a trade that we’re prepared to do. We like the inflation adjustment of multifamily, just as we love the inflation adjustment of our observatory. We have inflation protection through operating pass through with our office. However, that does not adjust the rents on a regular basis with the greater periodicity of multifamily. So, we like the fact that, we think we can buy multifamily when we choose to buy it in a way that’s capital efficient, not just when we apply the capital to purchase, but also as we go forward through our ownership.

Okay. I appreciate the color there. Thanks for the time.

Thank you. Our next questions come from the line of John Kim with BMO. Please proceed with your questions.

Thank you. On Page 10 of your supplement, you provided some more clarity on your 2023 explorations, both on the positive and negative. I just wondering if you could provide some commentary on the leasing activity, you’ve gone to address that as well as some of the additional known decades.

Sure, John. Well, you’ve seen the breakdown that we provide on Page 10, just to some comment on that. We do expect the largest renewal in our New York City office portfolio to be at 1333 Broadway. And it’s about a 60,000 square foot or so tenant the rest are relatively, midsize or smaller tenants. Not a lot of change on our forecast of that case reminder as we do with new tenants, whether be in a given year or early renewal, they come off of that report entirely. So, we haven’t changed our forecast significantly from the past quarter as it relates to vacates, and renewals. I get comments previously on the health of the leasing market. Look, we had two really strong quarters back to back this past quarter, being really strong with improvement in net effect rents over the prior quarter, and certainly over a year ago. We continued to see activity throughout our portfolio. And I’m excited about the expansion of our amenities that I mentioned earlier. I think it’s, we’re getting a really great response from brokers and prospective tenants, reminder, all of the things that tenants are looking for today, and the focus on in terms of health, wellness, in building amenities, neighborhood amenities, convenience to mass transit, newly built spaces, which we’ve been investing in our portfolio for well before COVID, these are all the things that we provide that attract tenants. And that’s the reason we’re benefiting from this slight to quality. So, we got good activity going into the third quarter and I’m please to what we see.

And Tom has the capital markets and pause in hiring, has that led to any additional indecision on leasing decisions?

Well, we’ve seen it, we saw a bit of slowdown in tours over the past four weeks to six weeks. Some of that I think is due to the normal summer slowdown. But as I mentioned earlier, what we’re seeing is that the tenants that are out touring space are much more decisive. And our conversion from tour to lease has improved over prior periods. So, we’re, I would say that the tenants said we’re engaged with are being decisive to buy with, as I mentioned, a bit of a slowdown of tour activity that’s typical for this time of year. So, a lot will be we’ll see, as we get into latter part of the summer and into Labor Day,

Maybe a question for Tony or Christina, can you just provide an update on the priorities we have on investments between multi-family, office and retail, just given probably the big price disparities among the three and then also versus additional buybacks?

Yeah, sure. John so as we've mentioned, that is our focus area, right. All three categories, but it really depends on finding the right deal. So I think we end up speaking more on multifamily because that's an area that we get asked on more, and that's a new addition to the portfolio as of late last year. But similarly, we look for the right return and we will look at all three of those categories and ways in which we can add value and generate upside for our shareholders. And I'm glad you brought up the point on buyback because in all instances it's not at the expense of not doing buyback. So fortunately we have a well positioned balance sheet and we will also have an eye towards capital recycling as Tony elaborated on earlier. And that means if we've added value and it makes sense to consider a sale, we can take those proceeds and redeploy it into any of those categories, maybe multifamily, could be office or retail. And to the extent capital recycling satisfies the proceeds for acquisitions, then our balance sheet can be utilized towards further share buybacks as long as the market continues to misprice our portfolio. So we view all of those as attractive opportunities provided, we find the right deal and clearly with share prices at these levels. The shares are very compelling.

Yeah. And I would just add, we bought a lot of stock in the last quarter and we bought it well. So we were pleased. And I second, all of Christina's comments.

Appreciate the color. Thank you.

Thank you.

Thank you. Our next questions come from the line of Jamie Feldman with the Bank of America. Please proceed with your questions.

Great. Thank you. It sounds like you're having some good success, leasing up office here. Clearly some broader market headwinds. We've seen some buildings get handed back to the bank in your submarkets. I mean, do you think that, that's an opportunity for you now that maybe you're just doing something different than some of the competition?

Well, look, Jamie I'll start that and let Tom jump in if you'd like to or Christina to add any other color. We spent a lot of money when we modernized our properties, focused on energy efficiency, built out amenities and maintained indoor environmental quality, so that we're in a position to offer outstandingly located assets at a great value. And we are a receptor of flight to quality in our competitive set at the top of the price range. And the fact of the matter is, takes a lot of money to do that work. We spent the money. You need to have the right basis to spend that money to make the profit that's out there. So we'll definitely continue to look at and our investment group looks at office as an opportunity for sure. And at the same time, we haven't seen anything that really is attractive to us at this point. That's just the bottom line. I don't know if Tom, if you want to add anything.

I echo what Tony said. We certainly keep our eye on everything and we'll look at all of the certainly office and multifamily, and we apply our expertise and our knowledge when we're underwriting assets. And so when we see an opportunity, we'll certainly we're ready to seize upon those opportunities.

I might throw in two other comments, if I might, office is still in a price discovery point. If you look at the, the, the purchase price of 450 Park and the cap rate there, and you look at the just announced transaction at 1330 Avenue of The Americas and the cap rate, there is a material increase in the cap rate, forget about the difference in assets. There's a material increase in the cap rates and frankly, less of a perhaps and upgrade releasing load at 1330. So we still think office has a way to go in price discovery. And we think that movement is justified. And again our assets are extraordinarily well positioned. All this conversation about older properties, and everyone's going to the newer stuff, what we said before, not everybody wants to pay a $150, $200, $250 a square foot for office space, or even if they wanted to, they can’t and we are a primary beneficiary their with and it’s shown by the strong leasing we did in the second quarter.

Okay, thank you. And would you say the pick up in leasing is, are these tenants who they didn’t have office for a while? Like they kind of, they shut down during the pandemic, or these are tenants who are already in the city, didn’t close down at all. They are just looking to either upgrade or be in a different building.

Well, we have a mix of tenants. We – iCap was an expansion of One Grand Central Place. They’ve been in the office and their business is doing well and they’re looking at their future needs and they’ve expanded with us several times now. The professional services firm that I mentioned earlier that moved from One Grand Central Place and double their space to take a full floor 501 Seventh Avenue, again, their business is doing well. And they’ve been in the office, another we renewed a sizable multi-floor tenant at 1333 Broadway. We announced following the close of the quarter, an early renewal for 79,000 square Franklin Templeton out in Stamford, Connecticut. They’re obviously fire sector. So these are all a mix of tenants that are see the long term needs for their offices, for their place for their employees to work and for them to conduct their businesses or make long-term commitments. And it’s a mix of new renewal and expansion tenants.

And I’ll add again, as is in our investor presentation with fantastic videos. I might add 2.2 million square feet of expansions in our portfolio since October of 2013. I don’t think that’s a coincidence. It means that our tenants really like what we offer, the price point is good, and we choose our tenants well, and that’s a benefit. iCapital Network, Signature, these are just the most recent meaningful expansions. And we continue to try to exercise very good tenant selection, be very clear. We built our portfolios, we got the best deals and the good times, and we get deals in the bad times. That’s what we’ve always said. And that’s what we hope to see.

That’s helpful. And then do you plan to build out amenity spaces in more buildings? And can you talk a little bit more about the cost to do that?

Well, we have the three expanded amenity projects that I have mentioned, and that’s all that we have planned for the time being. Again, it’s the basketball sports court convertible to a 300-person town hall presentation room with tenant lounge, the bar service, and a golf simulators that is in addition to this New York City’s large tenant-only fitness center of 15,000 square feet or executive gym conference center. And then the 23,000 square foot Starbucks Reserve is opening up later this year. So that’s a incredibly robust amenity offering at the Empire State Building. The Broadway Campus amenities that I mentioned that town hall presentation room of 1400 Broadway, alongside the tenant lounge at 1400 Broadway. And the very cool 1333 outdoor space with private cabanas and landscape will be available to all of our tenants in this Times Square South portfolio. This is on top of the in-building curated food and beverage options. We have 23 throughout the New York City portfolio and the neighborhood amenities. So that’s what we have planned right now. We think it’s an incredibly full offering. And we’re quite excited about it. We – well, lastly, we’re adding a wellness facility that are building a 250 West 57th Street. We’re private showers, cabanas, really, for those that want to exercise, bike, run, and such so forth in Central Park.

So I would just add, among the amenities, if you make note, some of it is a rooftop on one building. Another is a town hall within another building. We don’t need to build the same amenity for each one of our buildings, and that’s a major benefit of having a campus like portfolio. These set of amenities can benefit six buildings by building one rooftop, one town hall, that’s amazing cost energy. And as we look at the marketplace, you hear more and more about amenities, and you really need to question, I think we all need to question, should the building, every building build a gym, build a rooftop, build these centers and will they see the return on that? So it’s definitely a trend. It is in demand. But how many tenants and square feet can you service from that? So we find the synergies to be very compelling and some amenities we pay for in the build out cost. And some we benefit by adding it into the portfolio, for example Starbucks Reserve concept that's going to be fantastic for ESB.

Okay. And is this in any way a revenue source or no, this is just purely amenities?

The space on 1333 Broadway at built out will be absolutely dropped dead fantastic views of the Empire State building overlooking Herald Square. It's very sizeable place and because of the way 1333 Broadway is configured we've actually decided that we will make that a separate entrance on 36th Street, rather than gum up the lobby with that. We have excess freight elevators at 1333 Broadway. It was a former manufacturer ship and show building. So we think that's a big opportunity for that and other than that though no and the priority for 1333 is definitely as an amenity for our tenants.

Okay, great. Thank you.

Thank you. Our next questions come from the line of Blaine Heck with Wells Fargo. Please proceed with your question.

Thanks. Good afternoon. Just a quick one here on your dividend, you guys reinstated the dividend at $0.14 annually in May of 2021, and it seems like that's more than well covered at this point. So how do you think about increasing that dividend level in the future versus kind of maximizing three cash flow for uses elsewhere, whether that be repurchases or other investments?

Sure. Thanks for the question, Blaine. So on the dividend we review that quarterly and we have an eye towards having that go back to higher levels as the business continues to recover. So that's constantly on the agenda and you might recall the history behind it is we will do it based on requirements. So if we have taxable income, we will do it, if not we'll evaluate whether it makes sense and the alternative uses of that capital to return capital to shareholders, which does include share buybacks as well as providing continued operating runway for our business and evaluating other opportunities. So we'll certainly provide a dividend to our shareholders and we look at what is the best way to generate value across the board.

Okay. That's helpful. Thanks.

Sure. Thank you.

Thank you. Our next question has come from the line of Michael Griffin with Citi. Please proceed with your questions.

Yes. It's Michael Bilerman here with Griff. Tony, you expressed a little bit about looking at your portfolio for sale opportunities, and I was wondering if you could sort of frame for us maybe a goal post of sort of how much capital you can draw out of the portfolio. And I say that just from the perspective of, I think about some of your assets obviously have tax protection, obviously a number of your assets also have mortgage debt on them. Sometimes it's the same asset that has tax protection, the number of your assets have ground leases to them. Obviously the Empire State building and the observatory is key to the company. And as Christina just walked through, you think about the campus approach that you have with those buildings around ESB. I would imagine that all this capital you're spending you wouldn't want to then take an asset out of that. So how should investors think about really the total amount of capital that could be generated from asset sales and effectively the cost of that capital given some of the limitations from a tax protection, mortgage debt, ground lease on some of them?

No, appreciate the question. I'll start and then maybe Tony will add some comments. So as we've mentioned, we've taken a hard look at every asset and that includes tax. That includes the future of capital needs. That includes future prospects and so we take everything into consideration. Having said that nothing's off limit, it's all about having the right transaction. So we're definitely not for sellers as we've communicated based on our balance sheet positioning, our debt maturity schedules. So we don't have pressure, but we will look at it opportunistically, right buyer, right price, right deal, right structure that allows us to get around any of the items that you reeled off. If it makes sense it's available for sale. If it generates value for shareholders, it's available for sale. And how we redeploy that there's number of options. It's about looking for the right deal in the categories that we've already mentioned. In the market New York City that we are focused on and there's also share buyback. If we can buy back more of our – the rest of our portfolio at a highly discounted valuation that's very much on the table as well. So appreciate all those challenges that you mentioned. We definitely think about it and we will take that into consideration as we evaluate each and every one of our options.

Right. And we'll just do this in as tax efficient and logical way as possible. We know the numbers, we've done the calculations and we just approach it from there. It's the same effective way that we transferred out ownership at Merit View.

Right. I'm just trying to get a sense of how much of the portfolio really investors should expect could be liquidated. Now that you've gone through this review, I don't know if it's $500 million, is it a $1 billion? I'm just trying to get some goal posts, Tony around, how much you're looking to sell, because I know you're not happy where the stock price is. I recognize you're not for seller, but where the stock is. There's a pretty large disconnect from what you're talking about?

Well, we were certainly happy buyers in the last quarter. And we bought several tens of millions of dollars. And that's the benefit of having this fantastic balance sheet with no maturities until the earliest. We've got one loan, a mortgage in 2024 late in the year. We've got a lot of cash. We have 5% of our debt is floating rate. Everything else is fixed. Number one, number two, we really can't give any forward looking comment. However, it's public knowledge that 500 Mamaroneck and 10 Bank Street are on the market. We put our real estate retail on Main Street and Westport on the market. Candidly, we had a price we liked that potential buyer's stock, didn't work out. So we like the, the cash flow we get from that. We've got eight and half years weighted average lease term, unless it's compelling, we won't sell it. So that's where we are. And outside of that, we wait each thing as we go, we've got a lot of flexibility on our balance sheet cash on hand, undrawn online in order to take advantage of things as we go forward.

Right? And to that point Tony, the balance sheet is in good shape with that cash and low leverage. But if you take that hindsight approach of where the stock has come from, right, and you look over the last five years, the stocks down well, over 60% underperforming peers and significantly underperforming REITs, but even benchmarking it relative to last October, when you announced the multi-family entry, the stocks off, 25%, 30% relative to REITs down 10. And so I just don't know how much time you and the management team and the board are sort of just saying, okay, we've taken all these steps. The market doesn't seem to be reacting the way we want them to, what else can be done. And that's where, it's all sort of coming to a head and you can keep on buying back stock, but perhaps that there's other issues of why the stock is trading, where it is. I mean is there, is that part of your, and the board thinking.

As this sounds like your last quarter Michael, when you asked what's our reason for being…

You are being right. You are a public company, Tony, I know you exist but at some point, as I think a board and a CEO, you have to look at how the market is pricing. And if it's the market's not willing to price it, then maybe they're not endorsing the strategy you're going now.

Totally appreciate this. And I appreciate your continued question. I look forward to continue this conversation with you in the future; Our four priorities are clearly stated rent space, sell tickets. We want to fulfill our goals on sustainability. And we want to work with our strong balance sheet recycle and apply it as, and where it makes good sense. And as far as I'm concerned, we've done a great thing by our investors, with the stock that we've repurchased. We did a great thing by our investors, with the, that the resi assets that we acquired. And I just have a feeling that, if you're asking me whether or not I plan to push on a wet string to, to tell the company forward no, we're just going to be intelligent and logical as we go through this period.

Thank you.

Thank you. There are no further questions at this time. I would like to turn the call back over to Antony Malkin for any closing comments.

Thanks everybody for attending. Please remember that forward looking statements including guidance are meant to be helpful with forward modeling and they are not guarantees, many thanks to our great team who have worked incredibly hard, that the folks at the observatory who won that number one in the United States and the folks, who have shown up every day and really delivered on behalf of stakeholders. We look forward to the chance to meet with many of you at non-deal road shows, conferences and property tours in the months ahead. Until then, thank you for your interest and onward and upward.

Thank you. This does conclude today's teleconference. We appreciate your participation. You may disconnect your lines at this time. Enjoy the rest of your day.