Welcome to the Dream Office REIT Third Quarter 2023 Results Conference Call for Friday, November 10, 2023. Please be advised that all participants are currently in listen-only mode, and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press star, then one on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star and zero. During this call, management at Dream Office REIT may make statements containing forward-looking information within the meaning of applicable securities legislation. Forward-looking information is based on a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond Dream Office REIT's control, that could cause actual results to differ materially from those that are disclosed in or implied by such forward-looking information. Additional information about these assumptions and risks and uncertainties is contained in Dream Office REIT's filings with securities regulators, including its latest annual information form and MD&A. These filings are also available in Dream Office REIT's website at www.dreamofficereit.ca. Your host for today will be Mr. Michael J. Cooper, Chairman and CEO of Dream Office REIT. Mr. Cooper, please proceed. Thank you very much. I'd like to welcome everybody to our third quarter conference call. Today, I'm here with Jay Jiang, the CFO, and Gordon Wadley, the COO. I was going to make some opening comments before I turn it over to Jay and Gordon. You know, over the last 18 months, we've seen some massive changes in interest rates, in economic activity, in the housing market, and generally in the economy, number one. Number two, as a result of COVID and changes in the workforce, we've seen real changes in how office buildings have been used. So you know, it's really remarkable because overall, lots of segments of the economy are doing quite well. But I would say that real estate generally and office buildings, specifically, are on the wrong side of the big trends. So I mean, it's very frustrating and it makes it difficult, but I think our business is doing very well getting through this. Our view is that things are getting better. We don't know how long it will take, but the equilibrium level is, is—will be much more desirable for owners of buildings than what we have now. So what we see in the last 90 days is about a 10% increase in the number of people downtown, and it's been an incredibly slow recovery, but we are seeing a solid recovery. We're seeing lots of interest in retail downtown, the use of the retail stores. We're seeing more people in the premises, and we're actually seeing lots of tours. And if you've been paying attention, we talk a lot about tours. Over the last couple of years, we said we've got lots of tours, but we haven't necessarily got lots of leasing. I think what we're seeing now is we have lots of tours and lots of leasing, and we have lots more tours and lots more leasing. So effectively, I think we are seeing a lot of progress. It's very expensive, but the run rate of the leases that we're doing now, we're glad to have great tenants in the building. It's a lot better than vacancy. We burn off the cost relatively quickly, and the building is in good shape. The expectation is that over the next two or three years, we will see decent rents and less costs. And that's what we modeled on September sixth, when we put out our numbers, saying that over the next, you know, from September, I think we said the next three years, we're assuming the same cost of deals as we have now. And, after that, we're looking at, maybe half the way to where we were, half the way increase in occupancy to where we were, and the company starts to look really good. We don't know if it's three years or not, but I think we're weathering this, really unique time, quite well. And the other thing I would point out is, I was leasing office space in 1992. There's a couple of things about that. Way fewer tenants, way fewer transactions, even more expensive on the one hand, but the other thing was the economy generally was in much worse shape. So we see a lot of businesses growing. It's a very positive sign for our business. So I think the economy generally is much healthier than it was in 1992, even though the environment right now is worse than we've seen in a lot of years. So we're happy to answer questions later, but for... I'd like to turn the call over to Jay and then Gord and then Jay to go over some more details specific about our business, and we're happy to answer the questions after that. Gord? That's great. Thanks, Michael. Hope everyone's doing well. Just to piggyback on, on a lot of what Michael was saying, none of us in the industry are immune to the headlines, and I don't think there's been anything more polarizing than the impact of value, slower than anticipated return to the office, and negative sentiment around office space in non-core, but predominantly Class B and Class C assets. I would say Toronto's fared much better, and we're quite optimistic year to date, with about 614,000 sq ft leased already. Just to give some perspective, we're on track to exceed last year's full-year leasing velocity of 659,000 sq ft. We've got another 240,000 sq ft of deals that are conditional or under advanced negotiations, and we still have almost two months to go to close out the year. So on a gross leasing perspective, we've been outpacing 2022, which, for some context, was our best year since 2019. Our reputation and ability to manage, coupled with our well-located assets, has helped us secure some of the best covenant tenants for arguably some of the biggest deals in a very, very competitive sub-market. We're pleased to announce that we've been able to secure Infrastructure Ontario for their largest renewal of the year at 438 University Avenue, SGGG Fund Services Inc. headquarters at 20 Toronto Street, ICICI Bank headquarters for the full building at 366 Bay Street, and we're conditional on a renewal for one of our largest tenants in the portfolio.... From an income perspective, we're seeing a very healthy spread of 17% on a net rent from two expiries. While for the large-scale deals completed year-to-date, have a weighted average lease term of seven years, which is almost two and a half years higher than the market average. From a performance perspective, the Canadian office market over the last three years can best be described as dislocated. For example, when one performance metric sees improvements or an indication of stability, such as overall vacancy rates or absorption, another metric, such as the amount of new vacant space arriving on the market, trends upward, and alternatively, NERs and income metrics also fluctuate, due in large part to costs. Couple this with growing interest rates and softening cap rates. There's undoubtedly been some challenges in the sector not seen since the great financial crisis. Up until the end of Q3, this pattern remains as deal velocity, like Michael said, absorptions and tours are all up significantly year-over-year. But to be clear, NERs continue to see material pressure with inducements, construction costs, commissions, and overall cost increases to transact. As a result, we've seen average NERs compressed, coming in at around CAD 17. However, average net rents continue to remain strong and consistent to underwriting anywhere from CAD 30-CAD 35 a foot. Overall, committed vacancy this quarter stabilized across all classes, and Toronto sits at about 17.5%. It's buoyed largely by a low vacancy in the Class A assets. Although the vacancy rates themselves did not see much movement quarter-over-quarter in the city, our managed and REIT properties saw positive absorption, and we're doing about 600 basis points better than market, with a current and committed occupancy in Toronto of almost 89%. This is up almost 50 basis points quarter-over-quarter, and I want to point out it's the third straight quarter we've seen growth in our current and committed. This is supported by some key deals, including Chop at Adelaide Place for 12,000 sq ft. As I mentioned before, ICICI Bank for about 40,000 sq ft, and we also did IO for about 200,000 sq ft at 438 University. That's going to see them extended until 2030. A lot of commentary has been made about the 20-year high in sublet space, which currently makes up about 30% of the total vacant space in downtown Toronto. Specific to our business, those sublease space only makes up about 2% in our portfolio today. The cost to improve suites has grown dramatically over the last 3 years. I'll be honest with everybody, gone are the days when you can simply induce with basic carpet, paint, and ceiling tiles. Tenants are so much more sophisticated in their expectations for a suite. CEOs have been replaced on tours by HR and facility managers. Front and center is HVAC quality, tech, video hubs, and smart building software, as well as adaptable furniture systems and wellness rooms. All of these cost drivers have seen NERs be compressed on average by about 20%. This is all coinciding with materials and soft cost increases, and some supply chain and procurement challenges to deliver. I am, however, very proud of our team to date, as we often self-perform the work and have consistently delivered on time and on budget. This reputation's been a real catalyst, catalyst for us in helping us win deals and outperform the market. As a result, we've earned almost CAD 400,000 in net fees and mitigated about CAD 600,000 in third-party fees, which we end up retaining. We've had some very, very cautious optimism with the additional 240,000 sq ft of LOIs and conditional deals in very active negotiation, which we hope to report on in subsequent quarters. One key driver to our future success is retail. For the past few quarters, we've been highlighting the negotiations and prospect of completing four marquee deals on our Bay Street collection. We're proud to say we've completed all of them. We've welcomed Milos, Daphne, cocktail bar, Alobar, and now Chop Steakhouse, newest concept at Adelaide Place. These are major retail deals with some of arguably Canada's top restauranteurs, and when all is said and done, will total over 52,000 sq ft. With the high cost of retail transactions and our strategy with retail finalized, we're optimistic leasing costs on a net basis will come down. This net new absorption, with average rents close to CAD 70 a sq ft, an annualized NOI impact of an additional CAD 4 million. These are all in our most desirable node. Thus, finishing off and finally supporting our thesis of, of bringing an elevated and all-new experience of boutique luxury to the core. This positions us well for tenants' flight to quality and really helping us drive value in these curated offerings that often appeal to Canada's top covenants and most discerning tenants who value quality more so than face rate. I'd say no one in the real estate market today is immune to the impact of rising interest rates, and it's become a more challenging lending environment today than three years ago. Since a historical low of 40 basis points in the mid-twenties, the 10-year government of Canada bond yield and cost of debt has risen by more than 330 basis points. Lenders are actively reviewing their office loan exposure and are becoming more selective based on property's location and quality, and really taking consideration and really putting into addition the covenant of borrowers. They're evaluating tenant profiles and leases very carefully, and loans are sized more conservatively. Getting back to my previous point on NER quality, tenants, too, are much more sophisticated in their demands, and they're acutely aware of their own balance sheet and liquidity position. Hence, many are trying to push traditional tenant costs to the landlord on transactions to induce and win their tenancy. This is having a real impact in this high interest rate environment, and we're seeing this all over the sector. Our downtown Toronto committed occupancy continues to be very resilient and our pipeline strong, which will continue to support healthy cash flows at our buildings. Covenant-wise, we have large commitments with the federal, provincial, and municipal government, as well as Crown corporations, coupled with our premium location, asset quality, and leasing prospects for our retrofitted downtown assets. Fundamentally, we continue to improve and leverage our strong lender relationships to ensure that our balance sheet is well protected through what we believe will be a trough in the lending market. We're renewing our largest tenants and have done so with IO, ILAC, State Street, Federal Government, and we're conditional with our last big, large tenant for a material blend and extend. More to come on this next quarter when we can announce. Despite some of the macro challenges in the sector, I really couldn't be more pleased with how the whole team's navigated through some evolving challenges to the industry. Their efforts and dedication to not only our company, but to our clients, is what I'm most proud of. At the end of the day, it's this combination of having irreplaceable assets, coupled with the quality, high character of the team of people that we have operating and leasing these buildings, that really gives me the greatest confidence closing out 2023 and going into 2024, in spite of whatever headwinds or macro challenges we'll face. And I'm going to turn it over to my friend, Jay. Thanks, everyone. Yeah. Thank you, Gord. Good morning. Our third quarter FFO per unit was CAD 0.35, which was flat year-over-year. Included in the FFO was approximately CAD 0.01 of non-recurring restaurant startup costs in one of our joint ventures on Bay Street. Accounting rules require us to expense these costs upfront, but we will be able to recover it from our tenant over the term of the lease. We expect our fourth quarter FFO per unit to be relatively flat from Q3. We think the total portfolio in-place occupancy will be up about 75 basis points as committed leases take effect towards the end of the year. This is offset by timing of temporary free rent periods and higher interest expense. We expect our 2023 full-year comparative properties NOI growth to remain right in the low single-digit range. We will provide our 2024 forecast on our fourth-quarter conference call in February. Our Comparative Properties NOI was up CAD 1.2 million, or 4.4%, compared to the same quarter last year. It was largely the result of 5.4% of higher rental rates on re-leasing and 80 basis points of higher in-place occupancy in Downtown Toronto. We have been monitoring the situation of WeWork at 357 Bay closely. In its public release, they stated the intention to reject the leases of certain locations, which have been largely non-operational. The court's filings show that they authorized the rejection of two unexpired leases in Downtown Toronto, none of which are 357 Bay. To date, they remain operational in the building and they are current on their rent payments. We will continue to monitor the situation closely. Our net asset value per unit decreased from 34.71 in Q2 to 34.42 in Q3, primarily attributed to CAD 17 million of fair value decreases across our portfolio. For properties that are valued under the direct cap method, third-quarter cap rates were 5.7%, which consisted of 5.34% applied for Downtown Toronto and 7.73% applied for other markets. Year-over-year, our cap rates increased 55 basis points in Downtown Toronto and 53 basis points in other markets. Our operational stats have helped to relieve some of the upward pressure on the cap rates. Year-over-year, our weighted average in-place and committed rents increased by approximately 7.5%, and we secured 614,000 sq ft of leasing this year at 16% higher rents than expiry. In addition to continuing to track observable leasing and market data, we intend to externally appraise approximately 25% of our portfolio each year. At the same time, our lenders also perform their internal analysis and may engage their independent appraisers to value our assets prior to mortgage refinancings. This year, we have successfully completed our refinancing program. In aggregate, we were able to up-finance CAD 250 million of mortgages for CAD 278 million at a weighted average term of 4.6 years and interest rate at 6.3%. We think this is a reflection of our portfolio quality and the strong relationships we have with our lenders. Our carrying value for the income-producing portfolio is approximately CAD 460 per sq ft, versus implied trading price of about CAD 250 per sq ft. In addition, we have 3.3 million sq ft of residential density zoned at our share with a carrying value of about CAD 80 per sq ft. Currently, we're seeing replacement costs for new office buildings at over CAD 1,100 per sq ft. So it is very difficult to build new supply, but at the same time, we continue to see strong population and job growth in Toronto, so that bodes well for the location and the quality of our buildings. We think we have well-located real estate in a very high-growth city, so that when office sentiment in the market improves, unitholders are well positioned for attractive returns. Our Q3 leverage ratio increased 50 basis points from last quarter to 48.8%. We are actively looking to lower debt in our business by bringing in partners for our development sites, which will also help improve liquidity and reduce risk. At 2200 Eglinton, we have a deal in place with CentreCourt to jointly develop the first 1000 condos. We anticipate sales to launch in early 2024, and if that goes well, we have a blueprint to monetize future phases not long after. At 212 King, we jointly own a land assembly of 3 small heritage buildings with our partner in a very well-located area. We achieved zoning this year to create 875,000 sq ft of incremental residential density, and the 190,000 of non-residential density can potentially facilitate higher-end hotel and retail offerings. We have already engaged CBRE to market the site and will provide an update if we have more information on our next call. At 250 Dundas, we think the recent removal of federal and provincial tax on housing will have a material positive impact on development returns. We think this project will be attractive to institutional investors, and we will look for opportunities to sell down our interest and bring in external capital. In addition to the already zoned developments, we are working on other ways to reduce risk, improve the highest and best use of certain assets, or opportunistically sell assets to improve our balance sheet. With that, I'll turn it back to Michael. Thank you, Jay. I do want to revisit a word that, Gord used about dislocation. There's a lot changing in the office market. We've had a lot of tours recently. We had a session where we had 45 lenders do a tour of most of our buildings in an hour, and they were really impressed with the buildings. They've approached us to work on either renewals or putting out new money. We've had tours with other tenants, with other lenders separate from that. And the buildings look great, and people really like them. And I think they have a long, valuable life, and we're just going through a very difficult time for the sector, but we're excited about the future of what we own. So with that, we're happy to answer any questions. Thank you. We will now begin the question and answer session. To join the question queue, you may press star, then one on your telephone keypad. You will hear a tone acknowledging your request. If you're using a speakerphone, please pick up your handset before pressing any keys. To withdraw your question, please press star and two. We will pause for a moment as callers join the queue. The first question comes from Mark Rothschild of Canaccord Genuity. Please go ahead. Thanks, and good morning, everyone. Maybe for Gord, just in regards to the occupancy, it sounds like the committed occupancy is materially higher than the current in-place, which is already higher than the market. Should I infer from your word that you're saying that in-place should get to closer to 90%, in the next few years, around 2024? Or I just don't want to misunderstand what you're saying. Yeah, good question, Mark. It's in line with what we're saying. We're going to see probably committed occupancy at or around 90%. We're thinking kind of by 2025. But current and committed is a bit of a lagging indicator because those are committed occupancies where we have deals where we're either building the space for them now, we have full commitments with them. We're just doing the work, and it takes a little bit of time for them to occupy. So we think by 2025, that number is going to trend up to your point. Yeah. Just to clarify, so next quarter, we're going to be able to close quite a bit of the gap, I think, around 60%, and typically, tenants take possession towards the end of the year. Fixturing periods are longer, and we're continuously replacing tenants with churn, so there's higher rent growth on the new leases. But we feel pretty good about our committed occupancy, but the downtime in between as tenants prepare their space is typically about six months to a year. And presumably, just making sure I fully get that, there's no material lease expiries that would offset that over the next year and a half that you're aware of at this point. And obviously, retention's been a little lower of late than historically. So, you think that by 2025, it'll be closer to, if not at 90%? Yeah, Mark. So there is a table in our MD&A that shows the leases expiring and the amounts that have been secured already. I think at the quarter end, we were at 37%. We are working on a number of leases that will bring that average up in Q4. In terms of major expiries, there is one larger one towards the end of next year. We're working on a potential extension for that space, but you should see a higher number by the time that we begin the year. Okay, great, Jay. And once I have you, you spoke about a couple of different areas where you can generate liquidity or, or reduce leverage through, through selling other assets. To what extent are any of these near-term actionable items that we should expect maybe in the next three to six months, something like this happening? Or are these just potential longer-term ideas? Mark, we're just going through our budgets now, and, you know, this is a difficult time because we're still working what the plan is for next year. In the near term, we don't have anything we're working on right now that's actionable. Three to six months, we definitely could. We're just setting up what it is we want to look at, bringing capital in. So we're looking to bring capital into as partners in some of our developments. We mentioned that a quarter of the Edmonton site, we brought a partner in for, and we're looking at 250 Dundas, and we're also looking to see whether it makes sense to sell any assets, whether it's out west or in Toronto. But we're just telling you this is what we plan on doing. We're not, we don't have any specifics. Okay, great. Thanks. I'll turn it back. The next question comes from Lorne Kalmar of Desjardins. Please go ahead. Thanks. Good morning, everybody. Michael, you mentioned, you know, conversion rates on tours are going up. Do you happen to have sort of any numbers, even rough, just to give us an idea of what conversions look like versus, you know, maybe the past 12 or 18 months? Go ahead, Gord. Yeah, we've seen it go up. Good question, Lorne. We've seen it go up a little bit. We're kind of converting about 25% of the tours right now. ... but the velocity of the tours have picked up dramatically, since probably Q2. We've seen dramatic uptakes, in our downtown portfolio, and what's given us a bit of optimism is we've started to see some more tours in, tertiary markets like Calgary and, the, Toronto suburbs, Mississauga as well. Okay. I guess what would sort of be a normalized conversion rate on tours? Usually if they're touring and it's at scale, you should probably be in around the 33% range. Okay, so you guys aren't too far behind there. That's nice to hear. We're not. And then I won't spend too much time on the WeWork thing, but just wondering if you had had any inbounds on on 357 Bay from any potential tenants to backfill? Firstly, everybody asks us about WeWork, like we have access to something. We happily go through, like, 400-page, 400- to 600-page filings to find out anything. So as long as people want to ask us questions, we're able to answer with the same information that's available to you. WeWork has been very consistent that this building is important to them. They've been paying us, and they've got a fair amount of people in the building, and it looks like they're getting more people in it. So we're pretty comfortable with the building. The tenants in are paying a fair amount of rent, and it's a very desirable building. But, I don't think we're... Like, we are, we're not getting inbound from anybody saying they want to lease the building that's otherwise under contract with somebody else. But we are hearing from other people that they'd love to manage the operations if we need them to. Okay, fair enough. And then, maybe just on the 212 King, what do you think would be kind of a realistic price per square foot on that, given, you know, sort of a little bit of a cooling on some of the demand for land and development density? We don't know. I mean, what's happening is 212 King is probably among the very best sites in the city because it's right at the border of the financial core and King West. So that's the good news. What we're seeing on the development side is smaller projects are in favor over larger projects. That's about 1.1 million sq ft. And I know there's people that are looking at it, are trying to figure out how do they manage risk on such a large project. So it could be two groups, one does apartments, one does condos in the same building, but you know, we're waiting to see. We don't have a lot of insight for you. Fair enough. Thank you so much for the color. Sure. Let me take that back, Warren. We're, we're seeing some deals being done now at relatively good sites. You know, definitely in the top quartile, between CAD 160 and CAD 135 a foot. So there is deals happening. Just saying that, the mega sites are, are harder to do now, where maybe a couple of years ago, people wanted to do the biggest sites possible. Now, you know, managing risks, they're looking at 300,000 or 400,000 sq ft sites as more attractive than a 1 million sq ft site. Okay, great. Thank you. The next question comes from Sairam Srinivas of Cormark Securities. Please go ahead. Thank you, Operator. Good morning, guys. Gordon, I know you referred to this in your prepared remarks, but just going back to 2024 leases, can you give us some color on the conversations you're having with your tenants in terms of renewals and, you know, what are they seeing in terms of their back-to-office plans and their space utilization needs? Yeah, no, that's a great, that's a great question. So 2024, we're actively speaking with all the expiries. To Jay's point, you know, we're hoping next quarter we'll be able to talk about a large renewal. We've been working with some tenants. For the most part, we've seen... It's probably a 50/50 ratio of tenants that are growing and tenants that are downsizing. So, you know, with this one large tenant we're dealing with, now that we're conditional on, they're actually growing a little more than a third of their footprint. And they really like the flight to quality, so they're moving from other locations into this one, which is good. And then we've got a lot of other groups, probably in the same vein, that are downsizing a little bit. So if you're a 10,000 sq ft tenant, you know, we're seeing some downsizing to about 7,500 sq ft. These are more so for professional services firms. We're seeing a lot more, like private law firms, you know, fund managers, things like that in our portfolio. We're seeing them downsize a little bit, but we feel pretty good because they're taking long commitments. They're doing 5, 7, you know, some 10-year leases. But back to your question, it's about 50/50 downsizing and growth. And then how they're building their space, you know, we're seeing a combination, almost an equal combination of enclosed perimeter offices and then some open concept space. Thanks, Gordon. So does this also mean that, from your side, in terms of lease negotiations, you've been having to do a bit more of, CapEx upfront compared to, like, what you would have earlier done, I guess? Yeah. You're asking about the CapEx and the leasing cost, which is interesting because now the market's moved so quickly that we're evaluating our strategy. The TI for years have definitely gone up, but we think that keeping the buildings full is a good idea. The tenants, to your last question, they want great space for their employees. More people are coming in, but the office environment has changed. They like more meeting rooms, more open space concepts. ... So a lot of the money has been going into opening up a lot of the space, which we do think creates more value in the broader environment in the buildings. We're contemplating, for example, in the TI, you could be giving cash or free rent. Giving out free rent has a much lower opportunity cost, so we'll explore ideas to work with the tenants, work with their business plans, but at the same time, alleviate our capital pressures as well. Sorry, one interesting thing that we're seeing in an observation, you know, when you're seeing tenants and there's so much fluidity in terms of growing and shrinking in size, there's a new cost that not a lot of landlords are talking about, but I think it hits everybody, and that's how you're shuffling the tenants in the building. If the tenant's getting bigger, you sometimes have to make accommodations with other tenants to move them or relocate them. There's always costs associated with that, and then how you measure those costs is how you measure your NERs, and often they go in there, too. So I think that's a different cost pressure that a lot of landlords are feeling, and I haven't heard too many talk about... Too many people talk about it, but it's a, it's a real cost of a transaction. Today, more so than I've seen in my 20 years. Well, that's amazing color, guys. And, you know, when you talk about tenants actually going out from your current portfolio, where are you seeing them go essentially? Are they just moving to higher quality Class A product out there, or are they kind of moving out entirely of downtown? We haven't seen too—like, if we've lost tenants, it's usually because they've gone into sublet space. And it'll be, you know, net quality will be the same. But the sublet space, as everybody knows on the call, is dramatically more affordable. So we're seeing some people absorb some of the sublet space because it's got more flexible term in terms of years and then also in costs. But we haven't seen many people leave the core to go to the suburbs, or vice versa, see a tremendous amount of people come from the suburbs into the core. Awesome. Good, Jay, thank you so much for the color. I'll turn it back. Thanks very much. The next question comes from Sam Damiani at TD Cowen. Please go ahead. Thanks, and good morning, everyone. Maybe just to start off, I know we're talking about, you know, dispositions and the leverage ticked up on the quarter. How are you thinking about your target leverage over the next number of years with the dispositions you've got in mind, and how that might impact the REIT's ability to sustain the current dividends? Yeah, first, I'll talk about the leverage, Sam. Thanks. That's a good question. We're going to look for opportunities to delever. We don't have the precise data yet because we're working through the ideas of bringing in partners on the joint ventures. But if we were able to execute any of the three projects, that will have a positive impact on our leverage and also without sacrificing a lot of yield, because that is more for development density. We don't have a target unless we can predict what we can do, but our goal is definitely to take the leverage down over the course of the next year. I think by February, when we give the 2024 forecast, we'll be able to give a clean number, but leverage and liquidity are definitely top of mind. I guess your current thoughts on how the distribution sort of gets affected by all these ideas? You know, we're looking at the whole business. I mean, I think the market says that we're yielding too much. We're committed to the dividend. It's a board decision. We'll look at everything, but right now, it doesn't feel like the stock market's working very well with a valuation of CAD 250 a foot. So we'll look at it with the board. But I think what Jay and I have referred to both individually is, we're doing a deep dive on all the assets, different ways to go forward to surface value. We're having a meeting. We just had our board meeting yesterday, but a lot of the board meeting was talking about the things we're looking at for December. So we'll have a lot more information for year-end. Okay, great. Look forward to that, for sure, I guess, in February. And then I guess it was been talked about, you know, a bit already, but, you know, there is a lot of leases rolling next year. I guess one large one at the end of the year, which hopefully next quarter we get some good news. But, you know, that aside from that one, are you guys feeling pretty good about the 2024 lease roll? Yeah, I would say so. You know, we're still working through some deals. They're taking a little bit longer to get done. But the one thing I'll say about our team is they're engaged with absolutely everybody, directly and with their broker. So, you know, there won't be any surprises on our end. Okay, and then last one for me. There's been a lot of discussion on the increased costs of leasing, which, you know, in past cycles, has been purely a function of vacancy in the market. But this time around, it seems more like, you know, tenants are demanding a different thing from their office space. Just wondering what your thoughts are on how that evolves, as, you know, some point in time in the future when leasing markets once again tighten up. Is that cost of fitting out the interior space gonna stick or, you know, are the, are the landlord costs gonna, you know, drop to more favorable levels? Yeah, I think, Sam, we spoke about this September sixth. I spoke about it earlier. We feel that we're not at the equilibrium. We think that we're spending more per sq ft now than we will be over the long term. But the value of tenant today is pretty good. So if a tenant's paying you, like, CAD 55 gross, waiting 12 months, it's hard to. So if you forego that CAD 55 because you didn't want to spend so much. That CAD 55 bucks is CAD 5.50 a sq ft. You're not going to make it up. So we kind of go with the market on the TIs. I think a lot of TIs are driven now as costs have gone up since COVID started, and there's clearly a lot more negotiating power for the tenants. I made a comment that was picked up in the Globe and Mail about a bunch of buildings that were obsolete. What I was really focused on was, I think we're going to see more and more buildings being torn down with apartments being built. The city is focused on this. I don't think they want to make a universal call on how any building can be torn down and the office can be replaced. But I think what we're going to see is the supply of office space is going to be coming down. We're not seeing a lot of new buildings being built. We're seeing more people coming back to work, and we're seeing companies. A lot of companies are growing. So I think that the market is likely to get better based on things kind of not changing, let alone if we start to see interest rates coming down, an economy that's not flatlining, but actually growing. So yeah, there's no doubt that the focus that we're doing is to make sure that we keep our buildings as full as possible through this trough. And as we come out of it, we would expect that we would revert. And the numbers we use are very simple, halfway between where we were in 2019 and where we are now seems to be as good an estimate as anything. Very helpful. Thanks very much. Once again, if you have a question, please press star, then one. The next question comes from Matt Kornack of National Bank Financial. Please go ahead. Good morning, guys. Just continuing along that line of discussion, 74 Victoria Street and 137 Yonge Street has a pretty short weighted average lease term. How do you think about leasing in the context of your view that, again, some of these buildings, probably the highest and best use is to add some residential to them? Would you renew tenants in place at that building and put some flexibility in, in terms of your ability to redevelop at some point in the future? Yes, that's a great question, Matt, and that was the asset that I answered on an earlier question. The lease is up towards the end of next year in November. Gord and the team are actively in discussions with a couple of tenants. Longer term, it has a good rezoning potential. There is a gym on the ground floor, and it's doing very well. And we actually bought the alley a number of years back to protect our development rights. What we're really doing is really contemplating the capital we need to put into that building and seeing what the value is, but there is a couple of prospects and different uses. It's well located, and we're seeing good demand specifically on the education side. And also it's a good building for government tenant as well. It was a passport office and other agencies within the building. At the same time, we think there's an opportunity to extend the lease for a bit. So we're. There's a lot of options and permutations on the table, and we're just working through all the plans to come out with the best scenario for us. Yeah, Matt, one thing that's unique about that building is it has both residential and commercial density. So I was referring earlier about the ability to not have to replace office space. That building doesn't require it. So one of the things we're working on now, it's going to take longer than next month, is looking at the various choices with that building and determining what's the highest return. But there are lots of choices. Fair enough. Including existing tenants and some of the people we're talking to now. Okay. Yep, makes sense. And then, just a quick accounting one, because I think 366 Bay comes in next quarter. Is there going to be any straight line contribution in Q4, or will it be just the, kind of, the first three quarters of 2024, and then we'll convert to cash rent, upon kind of them totally taking? Matt, is that a question for me? No. Hey, Matt. So, so, that building's in PUD. I think that building is actually in PUD until, latter half of next year, not this year. And, so the tenant that we signed in the building, we're working with them on, creating a really beautiful, office environment for them. We'll be done in the latter half of next year, and, our policy is always to just record, revenue and income when they take economic occupancy. So, once the building comes out of PUD, the income will come in. It will also not hit the comparative, property, NOI numbers, but it will be in total NOI. Okay, fair enough. So I don't add the straight line contribution? No, you do not. That's helpful. Okay. Thank you. This concludes the question and answer session. I would like to turn the conference back over to Mr. Cooper for any closing remarks. Thank you very much. I'd like to thank everybody for listening and asking questions on the call. Jay, Gord, and I are always available if you have any follow-ups, and we look forward to speaking to you at the year-end quarter conference call in February. Thank you very much.