Federal Realty Investment Trust Earnings Call Insights: East Bay Bridge Acquisition and Market Rent Growth Prospects
East Bay Bridge Acquisition
Craig Schmidt – Bank of America: This is Craig Schmidt. I’m here with Jeff. I guess a question kind of focuses on East Bay Bridge acquisition. I know a lot of the leases you’ve mentioned are nearly 20 years old, so opportunity to push rents, but is there also an opportunity to do some re-tenanting?
Don Wood – President and CEO: This is actually one of the first acquisitions that we’ve seen in a bunch of years where I mean literally every (penny) is under market and then a number of them are doing extremely strong sales. A number of them are not and that’s really where the opportunity lies. Let me — Jeff is on the call now from California and (to deal), so let me have him address that.
Jeff Berkes – President, West Coast: We’ve got a couple of tenants in the lineup and it’s pretty obvious if you look at the lineup and see that the tenants are who that might be that – we either have an ability to really move their rent when their base term comes up because they have fair market value options or potentially recapture and improve the lineup so we’ll definitely be looking at doing that. The great thing about this asset and the reason we got so excited about buying I should probably mention to it’s something we’ve been working on as you might expect for a number of years. We’ve been talking to Catellus, first one there owned by ProLogis and then, again obviously after they were acquired by TPG about buying this asset and they are on our radar screen for a while. I’m very happy that we’re able to make a deal because its unique and that not only are the in-place leases well below market, but there is a significant shortage of box space in this trade area and when we look at our buoyed analysis for the trade area there is a long list of tenants that aren’t represented and who would want to be represented in this trade area. So, we’re pretty confident that we’re going to be able to take advantage of that and there are defiantly a couple of re-tenanting opportunities in the box lineup.