Thank you everybody for joining us and welcome to SL Green Realty Corp's First Quarter 2022 Earnings Result Conference Call. This conference call is being recorded. At this time, the company would like to remind listeners that during the call, management may make forward-looking statements. You should not rely on forward-looking statements as predictions of future events as actual results and events may differ from any forward-looking statements that management may make today. All forward-looking statements made by management on this call are based on their assumptions and beliefs as of today. Additional information regarding the risks, uncertainties and other factors that could cause such differences to appear are set forth in the Risk Factors and MD&A sections of the company's latest Form 10-K and other subsequent reports filed by the company with the Securities and Exchange Commission. During today's conference call, the company may discuss non-GAAP financial measures as defined by Regulation G under the Securities Exchange Act. The GAAP financial measure most directly comparable to each non-GAAP financial measure discussed and the reconciliation of the differences between each non-GAAP financial measure and the comparable GAAP financial measure can be found on both the company's website at www.slgreen.com by selecting the press release regarding the company's first quarter 2022 earnings and in our supplemental information, followed by our current report on Form 8-K relating to our first quarter 2022 earnings. Before turning the call over to Marc Holliday, Chairman and Chief Executive Officer of SL Green Realty Corp., I ask that those of you participating in the Q&A portion of the call to please limit your questions to two per person. Thank you. I will now turn the call to Marc Holliday. Please go ahead, Marc. Thank you. Good afternoon, everyone, and I appreciate you joining us all today for SL Green's first quarter conference call. We very much appreciate the opportunity to discuss with you the company's results and activities and provide some of our thoughts on the overall state of the commercial market in New York City. I'm happy to say, notwithstanding the challenging operating environment of the recent past, SL Green's portfolio is dramatically outperforming the overall Manhattan office market, reaffirming its place as New York's leading commercial real estate company and demonstrating its ability to adapt to an ever-changing market. We've done over 4 million sq ft of leasing in our office portfolio since the beginning of 2020, keeping our occupancy at approximately 93%, which is more than 10 full percentage points higher than the overall Manhattan office market. It's expected to rise above 94% by the end of 2022. Focusing on current results, SL Green signed nearly 900,000 sq ft of leases in the first three and a half months of 2022 alone, including the blockbuster announcement of IBM's 328,000 sq ft long-term anchor lease at our transformative One Madison Avenue development, a new lease to a global information services company encompassing 236,000 sq ft for their new headquarters at 100 Park Avenue, and a signed lease with UN Women for an 85,000 sq ft renewal at 220 East 42nd Street, more commonly known as the News Building. Even after all that activity, we still have an impressive pipeline of leases totaling another 900,000 sq ft, which we hope and expect to execute upon throughout the remainder of the year, in addition to building new pipeline throughout. With One Vanderbilt Avenue now 97% leased, the demand we are experiencing and leases we are signing is not just for new space, but rather for highly improved, amenitized and well-located space, which comprises the entirety of our portfolio. The success of our portfolio through the pandemic is the direct result of a multi-year strategy to narrow our focus on the best buildings in the best locations. As a result, our portfolio is without question the strongest it's ever been and getting even better with the announcement yesterday of the addition of 450 Park Avenue to our roster of premier buildings. We have worked incredibly hard over the past five years to transform our portfolio into the force that it is today, concentrated within resurgent East Midtown, with all the attributes that tenants have come to demand, health and wellness, exceptional amenities, great location, easy commutability, and high design. Looking at our portfolio today, we are lean, strong, and highly concentrated in our core prime assets. Over the past several years, we've dramatically reduced or entirely eliminated ancillary business lines, selling off our suburban portfolio, minimizing our retail and residential portfolios, and halving our debt and preferred equity book. Our core office portfolio remains a similar size, you know, from when we embarked at the outset, but we've replaced many smaller non-core assets with fewer, bigger, higher quality properties, thus giving us an edge on efficiency. New developments is now a much bigger component of our portfolio and will only grow as One Madison, 760 Madison, 7 Dey, and 15 Beekman move towards completion and stabilization. At the center of it all is One Vanderbilt, a triumphant development and the most successful building of 2021, leading an East Midtown renaissance and defining a new standard for office in New York and around the world. The response has been overwhelming, with more than 375,000 sq ft of leases signed in 2021 at record-breaking rents. The success of OVA has sparked a broader East Midtown revival, with massive investment taking place across the district now as the city's strongest leasing, which is occurring in core East Midtown. The building itself has become the locus of activity in Midtown, helping to draw people back. Last year, as you know, we opened Daniel Boulud's Le Pavillon at One Vanderbilt, signaling the return of the New York restaurant scene in Midtown. We knew the demand was there, but we've been completely blown away with the reaction as every dinner table has been taken since opening, with long wait lists to boot. In October, we upped the ante, celebrating the launch of SUMMIT One Vanderbilt, an immersive experience unlike anything else in New York. This was another major milestone for New York, signaling to domestic and global tourists alike that the city is open for entertainment and new and exciting things can come out of even the most trying of circumstances. In just 149 days of operation, SUMMIT One Vanderbilt generated over 550,000 total visitors from 57 countries around the globe, quickly becoming the hottest new attraction in New York City within a competitive landscape for entertainment attractions. Looking ahead, One Madison is poised to transform Midtown South, just as One Vanderbilt sparked a resurgence of East Midtown. IBM's decision to sign on as an anchor tenant is massive for New York City, signaling the long-term health of the city and the ongoing attraction of Midtown South. One Madison follows the One Vanderbilt playbook by leveraging its retail space to bring an amenity to the building tenants that adds value with Chelsea Piers, delivering a 56,000 sq ft fitness facility. One Madison responds in every way to the ongoing rapid transformation in work culture that has brought a heightened desire for healthy, productive, hospitality-focused work environments. We're bringing this same approach to a series of new development projects, including 760 Madison, 7 Dey, 15 Beekman, all centered around modern and luxurious design, curated amenities, and outdoor space offerings. Looking to the future, there is reason for optimism based on the continuing job growth in New York City. 84% of office jobs have already been recovered, and full recovery is projected by OMB to occur by middle of 2023, with 24,000 office-using jobs expected to be created in 2022 alone. Every day, we see and feel New York City coming alive. We are proud to be a part of New York City's comeback, and we'll continue to look for ways to capitalize on the current market environment to deliver value to our shareholders. Thank you, and we are happy now to take your questions. Thank you. To ask a question, you will need to press star one on your telephone. To withdraw your question, press the pound key. As a reminder, we limit questions to two per person. Our first question comes from Alexander Goldfarb with Piper Sandler. Your line is open. Hey, good afternoon. Good afternoon, gentlemen. Two questions. The first question is for Steve. Certainly, you know, headlines One Vanderbilt have been great for Midtown. As you look at the buildings in the Grand Central Market, are tenants still saying, you know, brand new construction, that's where we want to be, so the bias is whether it's the Far West Side or downtown to new buildings? Or are you seeing tenants increasingly look at older vintage assets in the Grand Central Market? I'm trying to figure out, is older vintage in Grand Central becoming more competitive and basically how this relates to 450 Park? Well, I think all you have to do is look at the 235,000 sq ft lease that we did at 100 Park Avenue to answer that question, right? It's a vintage building, but it's been heavily renovated over the years and amenitized. We're seeing a similar sort of activity throughout our portfolio where we have well-located, recently upgraded, amenitized product. It's clearly not a bias simply to new construction, but rather a bias to good quality, well-positioned product. Okay. The second. I think 450 Park, with our business plan in mind for that product, is spot on, you know. Well-located, high design building. We're gonna amenitize it. You know, it's a sweet spot for financial firms, which is one of the biggest drivers for tenant demand right now. Okay. Andrew, on the DPE book, rates are obviously up big. I think about a third of your DPE book or so is floating. Are your spreads on the overall book fixed, so as rates go up and down, you're making the same spread? Or, I don't want to say mismatch, but, you know, are the funding costs different than the interest rates that you're receiving such that the spread's gonna vary as interest rates are rising? No. We're hedged, if you will. I mean, the floating rate assets have fixed spreads over the floating index, which resets every 30, 60, or 90 days, depending on the documents. The new loans that we're looking at originating are also primarily floating to increase that sort of floating rate hedge that the debt book provides us v ersus our floating rate liabilities. Okay. Thanks. We don't have any leverage, any specific leverage on the book today, so it's only, you know, funded off the corporate line of credit, basically. Our question comes from Jamie Feldman with Bank of America. Your line is open. Great. Thank you. I guess I just was hoping to maybe just take the pulse of, you know, where you think tenants are in terms of how they're gonna use the space going forward. I know a lot of companies, you know, offices are back open, maybe people aren't back fully, they're giving flexibility on how many days a week. Just as you're talking to your tenants, I mean, what do you think the future looks like in terms of, you know, how many days a week people will be in the office? Are they gonna be hoteling? Just any color you can provide on kinda just the latest thoughts. I don't know that, you know, companies yet know definitively how they'll be using their offices within the near term. I think to me, the best takeaway is evidence of what tenants' long-term expectations are for, you know, office space being the center of business activity. That sort of relates back to the 4 million sq ft of long-term leases, or mostly long-term leases we signed all during pandemic, where, you know, tenants have gone through and thoughtfully considered how they wanna use their space, clearly de-densifying from the plans we saw three and four years ago, to, you know, loosen up the footprints as it were, and also to incorporate significantly more non-work office space or non-workstation space for all the different things we've talked about over the past few calls in terms of collaboration space, you know, food and beverage, lounges, conference facilities, breakout rooms, mothering rooms, wellness rooms, et cetera. I think, you know, the plans are exciting. They're more thoughtful. I think by and large, all the new space being built today, you know, is more productive space for employees, more appreciated by employees, more appreciated by clients. There seems to be less, you know, mono focus on density and efficiency, and it's more on sustainability, healthfulness, and productivity. I think that's been the big shift we see. Whether tenants' employee base are coming back three days a week, four or five days a week, what seems pretty clear is that every one of those employees are still landing at a unique workstation. I think the days of hot desking or sharing, you know, is reduced now from what it was, as people tend to want their own space, their own environment. You know, the commitments of space being made by tenants are generally for the same or more space footprint than previously, at least in our portfolio of 27 million sq ft. That's what we're seeing. 35% of the tenants in our portfolio are expanding. You know, for those that have signed leases for renewal in the portfolio. You know, clearly, we're not seeing a trend like existed before. The densification trend was one of the toughest, you know, we faced over close to a 10 to 15-year period predating COVID. That really seems to be somewhat halted, if you will. Instead, you know, these kind of new and inventive floor plans, which, you know, create hospitality-like environments, that, you know, anywhere between incentivize employees back to the office or help on recruitment and retention, we see that as the trend of the future. You know, you can speak to the businesses. We have 900 tenants in the portfolio. Speak to any, you know, grouping, subset of them, and I think they'll tell you how much focus space planning now gets. It doesn't seem to be a trend towards smaller space. But if you ask them specifically how many people, what days, I don't know that they know that yet. I just know that our portfolio is experiencing physical occupancy levels between 40% and 50% between based on what day of the week it is. You know, those levels are starting to feel really good and, you know, getting back to the utilization, you know, we've seen in the past. We have a ways to go, but I think we're heading in the right direction. All right. Thank you. I guess for my second question, turning to Matt. Matt, I know you've maintained guidance. I assume there's a lot of moving parts, though. I mean, clearly rates are probably higher than, you know, you expected to start the year. Can you just talk about kinda what's up and what's down, based on what you originally expected as you think about the guidance? Yeah. I mean, really the topic is rates. I mean, operationally, everything we saw in the first quarter was right on top of our expectations, on every metric. For the balance of the year from an operating perspective, you know, we're seeing exactly what we expected to see when we gave guidance in December. It's really a question of rates right now. If you recall back when we gave guidance We do cushion the forward curve on our floating rate debt by 50 basis points, which gives us room for the curve to move. Traditionally, it hasn't. This year, it has. We put 50 basis points on it back in December, and the forward curve has pushed through that 50 basis points and beyond. It leaves us within the range, but certainly looks like you're trending towards the lower end of the range just as a function of the movement in rates. Would you say there's anything that's offsetting that or it's pretty much everything's as expected other than rates? I mean, the activity we're seeing in the portfolio, NOI was a tick better in the first quarter. I'm not, you know, spreading one quarter out over the remaining nine necessarily, but we've seen, you know, some indications of better performance in the operating portfolio, in the first three months. If that carries out, yeah, that would offset it. Otherwise, you know, pretty much in line across the board with what we expected. Okay, great. Thank you. Our next question comes from Michael Bilerman with Citi. Your line is open. Hey, it's Michael Bilerman here with Manny. Marc, I was wondering if you could maybe spend some time just elaborating a little bit on the growth in the investment management program. Maybe just talk about it from the perspective of obviously, you've had venture partners for a long time, and you've utilized those very successfully to refinance and recycle capital. As you think about, you know, 450 Park Avenue going into that at, you know, north of $1,300 a foot, obviously you're buying your stock well south of that, you know, over half of that discount. I'm just trying to, you know, understand, you know, how much do you wanna sell existing assets to grow the platform versus making incremental. I recognize you're constantly doing things, and the organization's constantly in motion. Just help sort of frame everything as you progress down this road of really creating this platform. Well, you know, I mean, as you point out, Michael, we've been doing deals with partners for decades. You know, we consider ourselves, you know, a very good partner for people who wanna invest in New York City, specifically Manhattan. You know, we've had a very good track record with investors, both domestic and all over the world, and we wanna continue that, because, you know, quite frankly, for us, it's been a bit of a more reliable source of equity through the years and through cycles than the public markets have been. You know, there have been times in the past public markets have been, you know, favorable. Completely closed. You know, I'd say I can't really say that over the past four or five years. You know, it's we have to lean into, on behalf of our shareholders, heavily, you know, accessing what I would say the most dependable, consistent, and appropriately priced equity capital is, and that tends to be domestic and foreign private equity. You know, for that reason, we're not only continuing along that path, we're increasing it. You know, really what I think you're seeing there is a shift from a company that's been very transactional over the, you know, let's call it prior two decades. You know, recall that August is our 25th year as a public company on the NYSE. We'll be celebrating that milestone date in August and September of this year. I think the evolution has been to one where we now want to. We've built a significant brand value. We have an excellent platform. We have excellent people. We have excellent systems and controls and procedures and security and marketing and leasing and everything that goes into it. Now with You know, I think we move into a phase of transactional company into franchise and platform company where we can, you know, utilize our expertise in this very narrow slice of the market, albeit very sizable part of the market, to become a provider and co-investor of, you know, best-in-class services for excellent real estate, which seems to always be in demand in New York City, regardless of market cycle and regardless of interest rate environment. I think 450 will be an excellent litmus test of that thesis, a property that even at, you know, the per sq ft price you reference, we think represents extraordinary value, given its location, what I would call maybe the bluest chip of locations arguably in New York City, 57th and Park. The building is an excellent boutique, class A building that I think, under our stewardship, we'll be able to bring a new vision to that property for amenity and service and improvement such that we should be attaining rents at the very highest levels, just short maybe of what One Vanderbilt commands in new construction. Therefore, on that basis, there's real runway there for us. You know, you mentioned $1,300 a foot. There's no reason buildings on Park Avenue couldn't routinely be approaching $2,000 a foot and certainly above for building new buildings like One Vanderbilt. So we see significant upside. We also see significant attraction because for people there is a wealth of investors, a depth of investors out there who want to invest with the best sponsorship in the best properties, in the best location in New York City. You know, 450, I hope, we like to think checks all those boxes, and you know, the proof will be in the execution. I guess it doesn't sound like you are already in discussions with existing or future partners? I mean, I guess stepping back from it, you know, to me like this is the first big deal you've acquired since 2018, right? I think it's a pretty massive signal, especially at a time where you've been shrinking the base. How much equity capital is out there for office assets? 'Cause I think one of the other things, Marc, that you've, you know, been demonstrating, you bought back like two REITs already, you know, by buying back 35%-40% of your shares. But you shrunk so dramatically and, you know, protected NAV and grown NAV by selling assets and buying back your stock at a discount. Got it. I guess at what point is there enough. Like I remember last summer when you and I had this conversation on the call about is there enough equity capital to take an office REIT private, right? You've shrunk your equity cap on an NAV basis down to, you know, call it $8 billion, you know, $7.5 billion-$8 billion. Is there enough equity if you lever up the entity so that you maintain the franchise, but you don't have to worry about the public markets? I guess that's I thought the question was how much capital is available. Where is the question for 450 Park Avenue? I gotta pick myself up off the floor here. There's lots of equity for 450 Park Avenue, that's for sure. Okay. We've had spectacular success with pretty much all of our joint venture partners in the past, if you go down the list. We've delivered astonishing market-leading returns to these investors. Therefore, given our track record and given the fact that we have the conviction to buy this building, the inbound calls have been great. You know, the call volume has been very encouraging, and people are anxious to, you know, invest in New York and invest with SL Green for sure. You know, there's a deep pool for a single asset deal. You know, for corporate deal, I don't think we're commenting on that at this time. No, it's not, you know. We need to address it, but it's. I don't think it's relevant to, you know, to 450. I mean, we're talking about the investment management platforms and asset by asset platform. I think Andrew's answered the question. The investor pool in today's market Is worldwide and domestic and is deep. Thank you. Our next question comes from Steve Sakwa with Evercore ISI. Your line is open. Yeah, thanks. Good afternoon. I guess I wanted to maybe touch on capital allocation and just, you know, get a better sense for, you know, share buybacks versus acquisitions via JV, you know, versus debt paydown. Just given kinda where the balance sheet is, Marc, and the fact that, you know, roughly 20% of the balance sheet's floating rate debt. You know, how are you sort of prioritizing or thinking about capital allocation from here forward? Well, you know, look, the capital allocation decision is, you know, fluid and changes, you know, quarter by quarter, you know, day by day almost. I think at a time of rising interest rates, we're gonna put more emphasis, if you will, just on a relative basis on debt repayment because debt repayment becomes more accretive relative to what it looked like when three to four months ago. So, you know, we've been buying back stock, we've also been retiring debt. So we've been trying to, you know, maintain that neutrality, but in a market like this I think we'll probably overweight debt repayment or debt retirement over, you know. I would say now through year end, you know, we'll see where, you know, rates settle, not in the next month or two, but you know, in the next you know, 12 to 18 months, where rates settle, whether they continue an upward trajectory or they level off, kind of as the yield curve would suggest, or you know, possibly retreat as they did in 2019 after a spike in 2018. Don't know. We try to maintain at all times a relative neutrality view neutral approach to interest rates, meaning the yield curve itself is the best arbiter of future expectations. That's served us well over our 25 years. You know, we also build in a cushion, which is why in the first quarter with our cushion, we still, you know, came out right on top of where we expected to be, notwithstanding the increase in the short end of the rate. You know, I think, you know, 450 Park, while I think it's indicative of where our rents are going forward, I wouldn't read too much into it, you know. I mean, we used to do, I think like a couple of billion dollars a year of acquisitions, and that was kinda routine for us. You know, this is a unique opportunity. Corner of 57th and Park. Corner of 57th and Park. We got it at, you know, what we feel was a very attractive price relative to its prior history. We think there's upside, and we think it's highly syndicatable. I put it in the category of almost a no-brainer, you know, for somebody like us who specializes in this market and in this asset class to sort of seize the moment and take the opportunity to take the asset down. You know, there's still an overarching recognition that, you know, we wanna be defensive in an inflationary environment. You know, with future asset sale proceeds, I would expect a lot of that, you know, disproportionately to be oriented towards debt reduction. There you go, Steve. Okay, great. Thanks. I know this has kind of been a topic that's come up a few times, and it might be hard to really speak to, but, you know, the New York, the Downstate gaming license, just trying to understand, you know, sort of where your head is around that as it relates to SL Green. Is this something where, you know, you wanna really try and be partners with a gaming company and go through the licensing process and be on the operator side? Are you looking at this more of, "Hey, we'd like the casino in one of our buildings because we think it attracts people, and we wanna be more of a landlord to the casino." I'm just trying to sort of figure out how you're sort of thinking about that in the- No, it's a good question, and it's not that we, you know, can't speak about it. I just wanna hold off probably until the next call to speak about it. I think it's a little premature, and I don't wanna speak off the cuff other than to say, we think it's a big opportunity for New York City. We think it's a big opportunity potentially for SL Green. You know, I believe the city should end up with, you know, not one, but two of the three licenses. I think that's completely appropriate in terms of, you know, how best to allocate licenses over an area known, you know, or referred to in Albany as Downstate, and capture different segments of the market because different locations will appeal to different customers and consumers. In that regard, we've studied it closely, and I feel New York, you know, New York City can handle, not one, but you know, two of the three licenses. I think that the single best location for a license is, Manhattan, and within Manhattan, I feel the absolute best, most obvious, least impactful, and most globally, accepted area will be Times Square. So, you know, we're on that, you know, that opportunity. In terms of how we'll participate, who we'll participate with, and, you know, what shape that may take, I'd say that's a conversation that is not right for today, but maybe, on the next call. Okay, thanks. That's it for me. Thank you. Our next comes from Derek Johnston with Deutsche Bank. Your line is open. Hi, everyone. Thank you. We see a lot of focus on the competitive but healthy New York City leasing backdrop, at least in desirable sub-markets. You know, elevated concessions probably important to win deals, and investors are gonna focus on rent spreads. How do you view spreads and concessions trending as we move through 2022? I guess, you know, what's changed since the investor event in December on those slides? Well, I don't think the concessions have changed, quite frankly. I think as we've said at Investor Day, and I think probably certainly through the starting through the second half of last year up until today, we think concessions leveled off as statistically you could see in the broader market where there's evidence that they may have, in certain cases, already started to trend down a little bit. I know that, you know, we posted some big numbers for this quarter, but you have to appreciate that of the 800,000 sq ft of leases that we signed, 700,000 sq ft of that were with new tenants. It just so happens that we had a quarter that was disproportionately weighted to new tenants as opposed to renewal tenants. Renewal tenants who typically have a lower concession package, so therefore, the weighted average is a lower number than what we posted this quarter. But if you drill down on a deal-by-deal basis, I still think concessions are, depending on the building and the size and the length of the lease, somewhere between $110 and $130 a foot in TI on a 10-year term. I think concessions for free rent have been sort of in that 14 to, you know, 14-month free rent period, roughly. And that's where it's been for the past year or so. That's what we're experiencing throughout our portfolio, when you do a tremendous amount of leasing to new tenants on long-term leases, then all of a sudden it paints a picture to suggest that maybe concessions have increased, and I don't think that's the fact at all. Okay, great. Look, IBM, really big win at One Madison. You know, we do know it's early on, but do you envision, you know, potentially another anchor tenant in place, maybe even later this year? And do you see the success at One Vanderbilt potentially driving early pre-leasing interest and demand for One Madison, especially given what we see as an employer quest for newness? We've got a number of tenants that we're speaking to at One Madison. We're in advanced discussions with some of them, and we're very hopeful that we're gonna have some additional announcements before the end of the year. Yeah. You know, the momentum is gonna build on itself. I think if we do additional leasing this year, and we can eclipse, you know, roughly the 50% mark, we'll probably be a little patient with the rest of the leasing because we'd be dealing with, you know, parts of the building that we'd be excited to be showing and marketing once the building is topped off because there's really no substitute for standing on, you know, on these floors and taking in these incredible views and vistas of the park, you know, of downtown, of some of the surrounding landmarks. The amenities will be further along, and I think as good as the amenities are in One Vanderbilt, we're gonna try and equal or outdo ourselves at One Madison. Thanks, guys. Our next question comes from Caitlin Burrows with Sachs. Your line is open. Hi. Good afternoon, everyone. Maybe back to the 450 Park acquisition. Could you give some color on kinda how it came to be? Was it marketed? Going forward, how much and over what time you think the joint venturing out of pieces could happen, and what amount of amenity investment could be made? Sure. The property was, you know, marketed in sort of a targeted way. The sellers had some particular requirements that we were able to meet, we think, you know, uniquely or that put us in a smaller group. I would expect the syndication to at least start by closing in June of the asset, and, you know, be completed by the summer. On the amenity front, you know, I'd say we're still assessing exactly what level of investment we wanna make in the building, but we do intend to market this at the very high end of the Park Avenue Plaza district offerings, and the amenities will be commensurate with that. Got it. Okay. Maybe just on the lease that you guys did at 100 Park Avenue that had the meaningfully negative impact on leasing spreads. I know it was only one lease, but it was a large one. Just wondering if you could go through the decision to re-lease that space to that user at a lower rent rather than lease it to someone else, or would meaningful investment have been needed in order to improve the rents. It does seem a little surprising given the location right by Grand Central or anything else you can share there. No. Remember, the majority of that space of that large block was in the bottom half of the building, large floor plates, the darker part of the building. The rents that we received for that lease, I think, are the same rents we would have received pre-COVID, quite frankly. I don't think it's a function of an investment. The negative mark to market is simply a function of the fact that we had a tenant rolling off at a very high escalated rent. It is absolutely not an indicator of rental rates on the broader market. It's simply a function of a one-off lease where the tenant rolling off was escalated way above the market. Got it. Okay, thanks. Our next question comes from John, BMO Capital Markets. Your line is open. Thank you. I'll be the analyst on the call asking about 625 Madison and any update on the ground lease reset. If it's a possibility that the asset is just given up. Well, no update on the ground rent reval. There still hasn't been a arbitrated decision, but that process is ongoing. We own two positions there, a leasehold position and a position in the debt recall. Which position are you referring to? The lease position. It really depends on the arbitrated rent. You know, we've sort of shared our returns on that position, assuming we walk away, which we certainly have not made a decision to do, are still, you know, positive. It was a great investment for the company. We're gonna play out the arbitration process and sort of see where it goes. We still are huge fans of, you know, Madison between 58th and 59th, and think the site and the location has enormous potential. You know, given today's market, we're gonna take our optionality to evaluate everything. Okay. Marc Holliday, on a follow-up on the casino license commentary, you mentioned potentially speaking about it on the next call. Just wanted to ask, do you think a decision will be made by then? I'm assuming you're talking about 1515 Broadway. How does that feasibly work if the asset's 100% leased? Yeah. I'm not at liberty to describe yet what building or buildings we've targeted for, you know, for potential, you know, gaming use. You know, possibly in the next call we will be. In terms of a decision being made by next call, I would say no. That's. This is a process that is likely not to be fully and finally decided until I think the end of the year or possibly first quarter of next year. The process will get going, but this is gonna be, I think, the way it's been set up, a very thoughtful, deliberate process that is being, you know, conducted by the state, but being is going to also incorporate, you know, home rule, if you will, and local support issues at, you know, in our case, the city level, which I also think is appropriate. You know, this is kind of a watershed moment for Downstate New York to be issued these licenses. I would expect the process to be, you know, thoughtful, rigorous. I believe, you know, in the scale of time I look at, it'll be done on a reasonable timeframe, but that doesn't mean three months from now. It probably is more like end of year or first quarter next year. Thank you. Thank you. As a reminder, to ask a question at this time, please press star then one on your touchtone telephone. Our next question comes from Ronald Kamdem with Morgan Stanley. Your line is open. Hey, the first question is just on CapEx. In the 10-K, you had sort of $82 million for recurring CapEx and $108 million for development and redevelopment. Now with sort of the leasing activity and the recent acquisitions and so forth, are those numbers changing at all or how should we think about sort of the CapEx going forward? No, none of the, you know, I'll call it CapEx is changing. As I said earlier, we're right on our business plan for the year. As to 450, touched on, you know, a fairly modest amenity addition. You know, some of that spend will happen this year, but it will likely be a JV spend. And then the asset is under-occupied right now, so there will be leasing capital over time. But again, in a JV structure, so fairly modest overall for us. Great. Just sticking with 450, can you share sort of the, maybe a little bit more color on the economics, whether it's cap rates or target IRR, both for 450 and also just in general what you're seeing in the markets overall? Thanks. IRR. Well, I think it's roughly a 4% going in return. Recall though, the asset has about 18% vacancy, so we'll be, you know, undertaking a lease-up program there. We expect IRRs in the mid-teens type returns. Which for an asset of this quality level, we're very excited about it. Thanks. Thank you. Our next question comes from Nicholas Yulico with Scotiabank. Your line is open. Oh, thanks. Look, first question is just on the lease term income from the JV pool. Can you just say what that related to? You know, was that also like a surprise sort of termination that, you know, contributed to some of the quarter-over-quarter occupancy drops? No. That was all actually projected. I won't talk about the tenants, but it was predominantly at 11 Madison. And then we had a little bit more at one of the other JV properties. But nothing unexpected. 280 Park had a little bit. Okay, thanks. Just second question for you, Matt, is, you know, on the interest rate swaps that are in place that are expiring you know next year, I guess, what is the thinking on that? I mean, are you just gonna kinda wait till next year to resolve it? You know, is there any chance that there's an earnings impact this year as you know, move to replace more expensive swaps? We have a series of swaps that we put on a couple years ago that mature in early and mid-2023. It goes back to the question we got earlier, and I think Marc addressed it on debt repayment. As we look at incremental proceeds from asset sales or wherever they may come, we're gonna be biased towards debt repayments, and the debt underlying those swaps will be targets. Okay, thanks. As I talk about incremental proceeds, it's worth reminding everybody that in late 2023, when we TCO One Madison, we get funds in from our JV partners, substantial funds in excess of $500 million, which can be used for debt repayment. Thank you. Thank you. I'm currently showing no further questions at this time. I'd like to turn the call back over to Marc Holliday for closing remarks. Great. Well, you know, for anybody left on the line, thank you for listening and for the questions. We've got a lot of exciting things ahead over the next few months until we speak again in July, and we look forward to it. Everybody have a good spring and beginning of summer. This concludes today's conference call. Thank you for participating. You may now disconnect.