FRP Holdings, Inc.

Good day everyone and welcome to today's FRP Holdings Incorporated second quarter 2024 earnings conference call. At this time all participants are in a listen only mode. Later you will have the opportunity to ask questions during the question and answer session. You may register to ask a question at any time by pressing star 1 on your telephone keypad. Please note this call is being recorded. I will be standing by if you should need any assistance It is now my pleasure to turn the conference over to CEO John Baker III. Please go ahead.

Thank you, Angela, and good afternoon. I'm John Baker III, Chief Executive Officer of FRP Holdings, Inc., and with me today are David DeVilliers, Jr., our President, John Baker II, our Chairman, David DeVilliers III, our Chief Operating Officer, Matt McNulty, our Chief Financial Officer, and John Milton, Jr., our Executive Vice President and General Counsel. As a reminder, any statements on this call which relate to the future are, by their nature, subject to risks and uncertainties that could cause actual results and events to differ materially from those indicated in such forward-looking statements. These risks and uncertainties are listed in our SEC filings. We have no obligation to revise or update any forward-looking statements except as imposed by law as a result of future events or new information. To supplement the financial results presented in accordance with generally accepted accounting principles, FRP presents certain non-GAAP financial measures within the meaning of Regulation G promulgated by the Securities and Exchange Commission. The non-GAAP financial measure referenced in this call is net operating income and pro rata net operating income. FRP uses this non-GAAP financial measure to analyze its operations, and to monitor, assess, and identify meaningful trends in its operating financial performance. This measure is not and should not be viewed as a substitute for GAAP financial measures. To reconcile NOI to GAAP net income, please refer to the segment titled Non-GAAP Financial Measures on pages 9 and 10 of our most recent earnings release. Any reference to cap rates, asset values, per share values, or the analysis of the estimated value of our assets, net of debt and liabilities, or for illustrative purposes only as a reflection of how management views its various assets for purposes of informing management decisions and do not necessarily reflect the price that would be obtained upon the sale of an asset or the associated costs or tax liability. Now, for our financial highlights from the second quarter. Despite revenues and operating profit remaining largely flat net income for the second quarter increased 242% to $2 million or 11 cents per share versus $598,000 or 3 cents per share in the same period last year. For the first six months, net income saw a 188% increase to $3.3 million or 18 cents per share versus $1.2 million for the first six months of last year. This increase was driven partly by the improved performance during lease-ups of our most recent multifamily development in D.C., The Verge, which drove down our equity and loss in joint ventures by $891,000 compared to the second quarter last year and $1.6 million compared to the first six months of last year. The primary driver for the improvement in net income was the performance of our most recent lending venture, Aberdeen Overlook. In the second quarter, Aberdeen Overlook generated $1.5 million in investment income compared to $560,000 in the second quarter last year from a previous lending venture project. Year to date, the project has generated $2.1 million in investment income compared to $614,000 from a previous project through the first six months of last year. By providing a developer we know and trust with the money required to develop land, for national home builders that are desperate for lots. These projects, while not part of our core business strategy in the long term, have generated returns for our cash well in excess of treasuries without tapping into the time and energy of our management and employees. Over the last three years, we have grown pro rata NOI at a compound annual growth rate of 21.6%. We've maintained that pace in the second quarter and the first six months of this year. Per-rata NOI for the second quarter was $9.2 million, a 22% improvement over the second quarter of 2023. For the first six months, per-rata NOI was $17.8 million, a 22% increase over the same period last year. Primary drivers of this growth were the multifamily segment and the industrial and commercial segment, as our mining royalty NOI is more or less flat compared to last year. Multifamily pro rata NOI increased by 84% this quarter compared to 2023 and 88% for the first six months compared to the same period last year. This growth is a result of the transfer to the multifamily segment of our 408 Jackson asset in Greenville and Bryan Street in DC from the development segment upon the stabilization of these assets when they reached 90% occupancy for 90 days. Same store NOI for Dock 79 and the Marin in Riverside was basically flat in the first six months compared to last year. NOI for Bryant Street and 408 Jackson compared to the second quarter last year when these projects were part of the development segment increased by 37.6% and 292% respectively. For the first six months, these projects increased 27.9% and 867 percent compared to the same period last year. These increases in NOI were the drivers from the multifamily segment for the improvement we saw in overall pro rata NOI. The transfer of the verge to this segment upon stabilization in the third quarter of this year should only improve this segment's performance on an NOI basis. Industrial and commercial NOI increased by 41 percent in the second quarter to $1.19 million and by 44% in the first six months to $2.3 million compared to the same periods last year. These increases are the result of having burned through the rent abatement concession periods at two buildings at our Hollander Business Park. These assets are now generating real cash as opposed to the unrealized revenues that we recognized in the early phases of occupancy from straight lining rents for gap purposes. Yesterday, we posted to our website a brief slideshow of financial highlights for the second quarter. For those who have not seen it, we are now publishing, for illustrative purposes, an estimated value of our real estate assets, net of debt and liabilities. Our analysis yielded a per share value in the range of $31.90 to $37.87. We provide this information to reflect how management views its various assets for the purposes of informing management decisions and do not necessarily reflect price that would be obtained upon sale of the asset or the associated costs or tax liability. I will now turn the call over to our Chief Operating Officer, David D'Avelio III, for his report. David.

Thank you, John, and good day to those on the call. Allow me to provide an operational perspective on the second quarter results of the company. Starting with our commercial and industrial segment, this segment consists of nine buildings totaling nearly 550,000 square feet, which are mainly warehouses in the state of Maryland. At quarter end, 95.6% of the buildings were occupied. Total revenues in NOI for the quarter totaled $1.4 million and $1.2 million, respectively, an increase of 2% and 41% over the same period last year. The large variance between revenue growth and NOI growth is due to several tenants beginning their lease term with rent abatement periods. GAAP requires the entire lease term to be straight-lined when calculating revenues. As a result, GAAP revenues are higher during the first half of the lease term than what is being received, and the variance is more pronounced during a rent abatement period. As stated above, NOI is a non-GAAP financial measure. NOI calculations back out the straight-lining effects. As a result, 2023 NOI reflected the reduced rental payments and 2024 NOI reflected the full lease payments. This is why we saw a 41% NOI growth compared to a 2% revenue growth this quarter over the same period last year. Moving on to the results of our mining and royalty business segment, this division consists of 16 mining locations, predominantly located in Florida and Georgia, with one mine in Virginia. Total revenues and NOI for the quarter totaled $3.2 million and $3 million, respectively, a decrease of 1% and 3% over the same period last year. These decreases were primarily the result of a $277,000 reduction in royalties to resolve a 2023 overpayment by our tenant at our Manassas quarry, which overestimated our portion of production tons, which is shared with other property owners. The outstanding balance of this overpayment credit is $53,000, which we expect will be exhausted in the first month of the third quarter of this year. As to our multifamily segment, this business segment consists of 1,483 apartments and over 117 locations located in Washington, D.C. and South Carolina. At quarter end, the apartments were 92.6% occupied, and the retail space was 75.6% occupied. Total revenues in NOI for the quarter were $11.9 million and $7 million, respectively. FRP's share of revenues in NOI for the quarter totaled $6.9 million and $4 million, respectively. This is a significant increase over prior quarters due to our Bryant Street and 408 Jackson Joint Ventures being included in this segment as of January 1, 2024, and adding $3.5 million of revenue and $1.9 million of NOI this quarter. As a same-store comparison, which only includes Dock, Marin, and Riverside, FRP's share of revenues and NOI for the quarter totaled $3.4 million and $2.1 million, respectively. a decrease of 0.9% and 3.7% over the same period last year. This is primarily the result of the average vacancy and average expenses increasing by 1% and less rental overage payments from our retail tenants this quarter as compared to 2023. An abundance of supply in the D.C. markets will continue to put pressure on vacancies and revenue growth in the foreseeable future. Rising real estate taxes and insurance premiums may also remain a headwind for NOI growth, which increased over 5.25% from a same-store perspective this quarter compared to 2023. Management continues to be diligent in tenant retention and rental rates in the market. We are pleased to have renewal success rates over 60%, with all renewal rental rates showing positive growth and a majority of our trade-out rental rates being positive as well. Now on to the development segment. This segment is where we acquire, entitle, develop, and create new income-producing assets that are transferred into our commercial, industrial, and multifamily business segments. Upon reaching certain completion and occupancy benchmarks, the segment uses capital to entitle and develop lands and fund our vertical construction endeavors with the goal of turning our non-NOI producing assets into NOI producing assets. The segment also lends funds to prepare and develop lands for sale to national home builders in exchange for principal and interest payments and profit sharing. In terms of our commercial industrial development pipeline, our 258,000 square foot state-of-the-art Class A warehouse building in the Perryman Industrial Sector of Harford County, Maryland is nearing completion and is expected to be delivered on or before November 1st of this year. Upon shell completion, this asset will be moved to the industrial commercial segment and will impact NOI negatively until it is occupied and stabilized with the operating expenses being passed through to the tenants. Our 200,000 square foot Class A warehouse building in Lakeland, Florida, located along the I-4 corridor between Tampa and Orlando, is where FRP intends to be a 90% partner with BBX Logistics and is well into the entitlement stage. Permits for the development should be in hand on or before Q1 2025. FRP and BBX also closed on land that will support two Class A warehouse buildings in Broward County, Florida, totaling over 182,000 square feet. The site is minutes from Port Everglades and the Fort Lauderdale Hollywood International Airport with frontage on I-595, accessing the Florida Turnpike and I-95. The entitlement process is now underway and permits may be in hand by Q1 2025 as well. In Cecil County, Maryland, along the I-95 corridor, we are in the middle of pre-development activities on 170 acres of industrial land that will support a 900,000 square foot distribution center. We look to secure permits in Q2 of 2025. we are in the initial permitting stage for a 55-acre tract in Harford County, Maryland. The intent is to obtain permits for four buildings totaling some 635,000 square feet of industrial product. Existing land leases for the storage of trailers on site help to offset our carrying and entitlement costs until we are ready to build, which could be as early as 2025, pending favorable market conditions. Completion of these industrial commercial development projects will add over 2.1 million square feet of additional industrial commercial product to our industrial platform, growing the business segment from 550,000 square feet to over 2.7 million square feet. Over the next three to five years, we will focus on the permitting, construction, and lease up of the Perryman, Lakeland, Fort Lauderdale, and 212,000 square foot building in Harford County. These four buildings represent over 850,000 square feet of new industrial commercial product with a total project cost estimated at $142 million. With 6% to 7% return on cost expectations upon stabilization, these projects represent some $8.5 million to $10 million in potential NOI. As to our multifamily development pipeline, The Verge, our 344 residential unit project located in the district, was 90.7% occupied at quarter end. Total revenues in NOI for the quarter were $2 million and $1.16 million, respectively. FRP's share of revenues in NOI for the quarter totaled $1.3 million and $710,000, respectively. While our development focus is currently weighted toward our industrial assets, we continue to watch market conditions and their impact on four multifamily projects in our development segment pipeline, located in Washington, D.C., Greenville, South Carolina, and Estero, Florida. These projects represent over 1,200 apartments, and 58,000 square feet of retail. Turning to our principal capital source strategy or lending ventures, I have the following updates to our two current projects. Amber Ridge in Prince George's County, Maryland consisting of 187 lots is completely sold out. Final development activities to get off bonds are ongoing. And upon completion of this project, interest income and profits are expected to total $3.9 million, a 21% profit on funds drawn. Our second lending venture, Presbyterian Homes or Aberdeen Overlook, consists of 344 lots located on 110 acres in Aberdeen, Maryland. We have committed $31.1 million in funding $24.6 million was drawn as of quarter end, and over $12.7 million in preferred interest and principal payments have been received to date. A national home builder is under contract to purchase all the finished building lots by Q4 2027. 78 of the 344 lots were closed upon, and we expect to generate at least a 20% internal rate of return and funds drawn upon completion of the project. In closing, we are pleased with the entitlement progress being made on several industrial land assets, particularly on our Lakeland and Fort Lauderdale projects in Florida. The renewal and trade-out rent growth within our multifamily assets is encouraging and a key indicator of where we are on the supply and demand curve. Interest rates and construction costs have appeared to stabilize, interest rate spreads have eased, and although new supply of apartments in the DC waterfront submarket remains a headwind for rent growth, absorption and demand for apartments and warehouse space remain a bright spot. As we look ahead, our focus remains on the margin between revenue and expense growth at our existing assets. having a fundamentally sound capital stack with sensible construction financing terms, and hyper-focused development, leasing, and property management teams. With several permits expected in 2025, our efforts and entitlements to vertical due diligence. Through our cautious, patient, and thorough vertical due diligence process, we will make informed and calculated decisions to weight, or pull the trigger on vertical construction. Thank you, and I'll now turn the call back to John.

Thank you, David. As we have said on several occasions, and you just heard in David's report, we are maintaining our strategy of focusing on industrial development and expanding our footprint on a square footage and regional basis. In July, we closed on the purchase of the land for our industrial joint venture in Broward County, Florida, for a total purchase price of $24.5 million. We also closed on the land for our other industrial JV in Lakeland, Florida last quarter for a total purchase price of $2.8 million. We expect to start construction on both projects on or before March of 2025. We are nearly finished with shell construction of our 258,000 square foot industrial asset in Perryman, Maryland with completion expected in the fourth quarter. These three projects, totaling 649,000 square feet of new Class A industrial space, represent an estimated $118 million in total CapEx and $72 million of equity capital, of which we account for $66.8 million. We've underwritten these assets at a 6% to 7% NOI yield on costs, but expect to outperform these conservative assumptions. I will now open the call up for any questions that you might have.

At this time, if you would like to ask a question, please press star 1 on your telephone keypad. You may remove yourself from the queue at any time by pressing star 2. Once again, that is star 1 to ask a question. We will pause for a moment to allow questions to queue. We'll take our first question from Steven Farrell with Oppenheimer Close. Please go ahead.

Good afternoon. Hey, Steven. Just a quick question. With the two Florida developments, the expected capex, $57 million and $28 million, does that include the purchase of land?

Yes. Yes.

Is there any particular reason why there's such a big discrepancy in the cost per square foot between the two?

Yes. In Lakeland, Florida, rental rates, let's say, range from $750 to $950. In the Broward County, Fort Lauderdale site, rental rates range from $1850 and are coming up against $20 a square foot triple net. And that well-heeled Broward County, Florida market land is

is just more expensive and and rental rates are a heck a lot higher um so that's that's the driving difference and even if i look at excluding the land though it looks like the construction cost to develop is about 180 per square foot versus 125 is it is there any construction related costs that are different?

A couple. The Lakeland building is a single building. It's a single 200,000 square foot building. There's just the efficiencies when you build a single building versus two, which is we're going to build two 90,000 square foot buildings in the Fort Lauderdale site. In Fort Lauderdale, there's some interesting site development costs. There are nuances to all these things. They may look the same, but there's always nuances that can move the cost around a little bit, particularly when it comes to the land development side of them.

Okay, thank you. For the Chelsea project, is there a lease in place for when construction is finished?

No, there is not.

Do you anticipate having any issue filling that space?

No, not at this time. The market, there's still a good demand. We feel we have a good product. Typically, it's rare for us to get buildings pre-leased before we really deliver them. This building really gets kind of put on the market Q4 of this year. And once we put it on the market and people can drive to it, pavings in, and they can walk in it, that's typically when we start seeing a lot of activity. We've had some, you know, inquiries, but no paper traded at this time.

Okay, that's good. And just a quick question on DOC 79 and Marin. In the new chart on the second page of your release. It looks like renewal rates at the dock were kind of outpacing Marin, which the percentage increased, which has not happened recently. Is there any color you can provide on that?

You know, I think that dock, for a while, may have, you know, had some effects of Marin. And now things are evening out and we're able to push rents at dock more these days. You know, dock also has, you know, just lower rental rates to begin with and more attractive. We'll have to see if it continues. I'd love it if DOC started seeing effective rents the same as Marin's. I don't know if we'll get there, but that's kind of where we are right now.

Yeah, I think Steve and I have pretty consistently pushed high rental growth at Marin. And last year at DOC, we were trying to maintain occupancy and you didn't see the kind of rent growth on renewals that you had previously. And I think this is probably Dr. Slank catch up.

That's good. That's all I have. Thank you very much.

As a reminder, if you'd like to ask a question today, please press star one. We'll go next to Bill Chin with Rhizome Partners. Please go ahead. Hello, Mr. Chen, your line is open. Please go ahead.

Good afternoon, guys. Hey, Bill. Hey. Good to connect with you guys. I have a few questions and may jump around a little bit. Just a first quick question. On the ProRata NOI for DOC79 Marin, the effects of that JV transaction, that's beyond, right? These are life-for-life numbers?

Correct.

Okay, got you. I guess, like, the drop in the NLI is due to a slightly lower occupancy and maybe expenses growing faster. Is that the read?

It is for Q2 alone. You know, Bill, year to date, they're even. Q2 is really the first quarter where we saw erosion. Okay.

When you say rows, are you talking occupancy or are you talking NOI? I just want to know which metric you're talking about.

Both. So Q2 of 2024 compared to Q2 2023, we saw around a 3.5% decrease in NOI. And from a occupancy standpoint, the average occupancy in Q2 2024 was about a 1% lower compared to Q2 2023. Got you. Got you. Okay.

Well, I mean, you know, the good thing is the renewal rent growth is, you know, kind of better than what we're seeing in the Sunbelt. Generally what we've been seeing is healthier rent trends in the DC metro area. I see that that's just the renewal. Do you know like what the, The new lease, I don't think you guys ever published that in the past. Like, what we see in some of the bigger REITs is the renewals are usually positive, and then the new leases tend to be slightly negative. Like, is that what you're seeing as well?

So at Dock and Riverside, we had positive trade-outs.

Okay.

And at Marin, the trade-out was negative. It was just under 2%, about 1.8%. and the negative.

Gotcha. That's helpful. Jumping over to the warehouses, can we assume Chelsea's going to get about $9 net a square foot? Is that a reasonable assumption?

You know, a couple of things. I would say that we are out in the market at $10 for Chelsea. Okay. You know, where we land is going to be, you know, it's going to be an equation of how many improvements they want and length of term and what type of annual escalations we get. So hopefully that average rate, you know, across that term is even better. But we're kind of looking at that year one rate. We're out in the market right now at $10.

$10, okay. That's helpful. And what's the market vacancy in that sub-market right now?

For our product type, I'd say it's, don't hold me to this exact number, but I'd say we're probably looking at 5%. 5%. Okay.

So, so, so, I mean, it's not, it's not too like before, but you know, still very healthy. Um, uh, the, um, I think in one of the earlier, um, filings you have mentioned, I don't know if it's an earnings call or filings. You have mentioned that you learned a lot from the, um, the company learned a lot from the lending venture, um, And you're exploring ways to potentially apply that kind of to the 20 acres you have in Florida and Georgia. If my memory serves me correctly, that's what you guys said or might have disclosed that. And any update on any potential sites or targets where we may... You know, we historically have thought of these parcels as multi-decade assets when the land will be available to be monetized, right? Like any update on any near-term monetization or just, and by near-term, I mean like within five years, right, of turning them into potentially home building lots, et cetera, like any commentary on that would be helpful.

Bill, go ahead, David.

Bill, I was going to say, you know, at one of our quarries in Fort Myers, Lee County purchased land from us to put a major road through it called Alico Road. You know, that's going to cause that's going to cause probably some of the mining operations to stop there because you can't exactly bring large aggregate vehicles across a major highway. And when stuff like that comes up, we look at it to see if there's a second life, to see if we can do something with it. Mm-hmm. You know, near term, I don't think that's something near term. You know, a lot has to happen for a major road to be built and, you know, water, sewer, and zoning. But that's the type of stuff that we're just keeping an eye on. You know, and if there's a way to squeeze some dollars out of property that otherwise is going to sit vacant, you know, that's what we're going to do.

Yeah, Bill, just to piggyback on what David said Vulcan is going to get every bit of limestone out of Fort Myers that there is to get prior to Alico Road being built. It's just too valuable to them. They are hustling to get it mined so that they can get to the other side of the road and continue mining in the second phase of that, but Those are, I wouldn't say they're top of mind, but we certainly revisit them often and continue to talk internally about what development will look like there. But particularly that site, you're going to need you're going to need to bring in some utilities with that road to make it happen. And until that road's built, it's not going to be possible to develop it. We are going to make sure that we're ready to develop that stuff as soon as it's capable of being developed.

You know, I remember there was a time when, you know, the bridge, the Frederick Duckler Bridge needed to be built in the 01 demo. And I thought, man, that's going to take at least 15, 20 years. But that happened in a much shorter time frame than I thought. You know, is Aleko Road, is that, you know, building Aleko Road, is that, Is that a three-year? Is that a five-year? Is that a 10-year? Like, help me understand, like, what kind of timeframe are we talking about?

Yeah, probably like 2027, 2028, something like that. Okay.

All right. Because in New York, when we say we're going to do something, we've been, like, 30 years later. So, guys, I just want to make sure that we're on the same pace there.

Okay. That's helpful. It's a priority for the county. That road... is going to open up a lot, a lot for them. And it's, I would say it's almost, it's probably the county's top priority. Got you. Got you. That's helpful.

It is, am I thinking too, too like, you know, too fast here because I've driven past late Louisa years ago. This is like eight years ago. If I remember correctly, that's right by Disney where all these subdivisions are going up. Is there any potential of that being sold to some home developer in the near term, meaning five, ten years for those slots?

No. I think, first of all, Cimex is going to have to to start mining, which hasn't happened yet. And I think they'd have to mine a pretty meaningful portion of the property just to get the kind of scale you'd want to develop it, which we're going to be making good money while they're doing that. And god, that place is going to be the proverbial hole in the donut. even when we can go about developing the first phase of it. And it is within kind of this overall concept plan in Lake County called Wellness Way. Everybody knows development's coming there. It's just going to be a little bit before we do, but I think that whatever... however long you have to wait, the demand for land down there is well exceeding inflation. So I don't think we're losing any money by sitting tight. We're going to be generating income as CEMEX finds it. Just be patient. Well, I mean, you know, it's not a bad thing.

not a bad thing to let every, everything else appreciate and get built out. Right. Like, you know, the whole new donut. So that's, um, is there a reason why that CMEX, I mean, it's, it's unbelievable. Cause you know, it's, it was a year ago when I drove across there, actually maybe nine now, but, uh, you know, CMEX still hasn't started. Like what's, um, any timeline when, when they may start, uh, mining that.

Yeah. I don't know. They know they own it, or at least have a lease on it. And I think kind of the biggest hurdle to them getting in there and mining was they were required to extend some county roads at their expense. That was part of getting permits. And they do have other assets in that. and so maybe it's not as if they were immediately running out of reserves and they could supply their ready mix operations with what they already had. They will mine it eventually. I know that and we are happy to collect the minimum royalty payments in the meantime. That's another, uh, another product that the price is exceeding the, uh, uh, inflation. So again, I don't, I don't think we're losing any money by them not mining it. The, um,

The site in Jacksonville, I know I'm jumping around a little bit, but I just have all these thoughts in my head. The site in Jacksonville that's now a vacant site, could that potentially be a warehouse?

I don't know about a warehouse, but I think it could definitely be equipment storage. Nothing we have to worry about immediately, but I think there's two or three years left on that lease. As we kind of get to a year or six months out, I think that's when we'll start exploring kind of its next phase. But it will not sit there vacant.

OK. And how big of a, how many square foot could be built on that site?

I don't know about its viability as a future industrial asset. I think equipment storage, at least for the time being, is its best use.

I don't think I have more questions, but I just want to leave the management team with a thought. Uh, I I've been tracking the company. I've been a shareholder for nine years since 2015, 2014, 2015. So maybe 10 years now. And I, you know, track the cashflow, attract the NOI. And I, I think that the, you know, the management team, the boys should start thinking about initiating a dividend. I know, I know there's a lot of projects in the pipeline. Uh, I know you guys do a great, you know, great job putting that capital to work. But I think that I also know that because I've been a shareholder for nine, 10 years, and I know your intentions, but that's not necessarily the case for the casual shareholder or prospective shareholder. And I think they're, you know, I know you guys went out and hired a really good IR team. I know that you guys are trying to increase visibility. So in today's environment, when you could get you know, 4% in the two-year treasury, 5% in the six-month treasury, and then the, you know, mid-America trade is paying almost a 4% yield. I think that there is competitively, you know, the company could be helped by initiating a 1% dividend because most of the capital could still be allocated, and that would be, you know, maybe just $5 million a year. I did some math before jumping on the call. I think we're going to be running at over $40 million of NOI once Chelsea gets leased, once Verge gets consolidated. And a lot of these assets don't have debt on their debt service is very minimal. And there's still a lot of cash on the balance sheet. So I think that initiating a 1% dividend will be good. I think more important than anything else is it signals to the casual shareholder and the prospective shareholder that there is an intention to return some of the capital to shareholders eventually. And I think if you start at 1%, you could have that dividend easily grow 10% a year or even 15% a year, and it will still be very, very affordable because the NOI has grown so quickly, and you're starting off at a very low base, at a very low amount. So that's something to think about. You know, sometimes on these earnings calls, I like to use the calls to kind of express some of my thoughts, and a lot of it comes from talking to other shareholders and other prospective shareholders, you know, who kind of have walked us up. And I think it will also help with the trading liquidity, which is kind of a perpetual issue that the company deal with. So it's not a question. It's more, it's more of, you know, sharing some of the feedbacks that I have when I talk to other shareholders.

No, Bill, that's a, that's really good feedback. And I'd be lying if, I said that it's not something that we've, an idea that we've at least bounced around. So I appreciate you sharing that.

Well, thank you. And I'm glad that, you know, it's been thought about internally and I have no further questions.

It appears we have no further questions at this time. I will now turn the program back over to our presenters for any additional or closing remarks.

Thank you all, and we, of course, appreciate your continued investment and interest in the company. Thanks. Bye.

This does conclude today's program. Thank you for your participation. You may disconnect at any time.