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Good day, ladies and gentlemen and welcome to the Life Storage Third Quarter Earnings Release Conference Call. At this time, all participants have been placed on a listen-only mode and the floor will be open for questions and comments after the presentation.
It is now my pleasure to turn the floor over to your host, Dave Dodman. Sir, the floor is yours.
Good morning, and welcome to our third quarter 2021 earnings conference call. Leading today’s discussion will be Joe Saffire, Chief Executive Officer of Life Storage; and Andy Gregoire, Chief Financial Officer.
As a reminder, the following discussion and answers to your questions contain forward-looking statements. Our actual results may differ from those projected due to risks and uncertainties with the company’s business. Additional information regarding these factors can be found in the company’s SEC filings. A copy of our press release and quarterly supplement may be found on the Investor Relations page at lifestorage.com.
As a reminder, during today’s question-and-answer session, we ask that you please limit yourself to two questions to allow time for everyone who wishes to participate. Please requeue with any follow-up questions thereafter.
At this time, I’ll turn the call over to Joe.
Thanks, Dave and good morning everyone. I am pleased to report another outstanding quarter. It has been a very active quarter on a number of fronts.
First, I am pleased to announce that we celebrated a significant milestone during the quarter when we crossed the 1000 store threshold. Second, I am proud to announce that for the fourth consecutive year Newsweek has recognized our team for Best Customer Service amongst store centers. And third, we continue to perform at record levels, with record occupancy for this time of year and exceptionally strong pricing power.
With regards to external growth, we are on pace to achieve record acquisition volume with over $1.7 billion of wholly-owned acquisitions, either closed this year or currently under contract and expected to close by year-end. This represents 115 additional stores and nearly 20% growth in our wholly-owned portfolio. These acquisitions represent a nice mix of both markets and maturity with roughly one-third still in lease-up and approximately 75% in the Sun Belt states.
We continue to expand in key markets such as Austin, Atlanta, Tampa, Miami, Phoenix, San Diego, Seattle, and greater New York City. Despite one-third in lease-up, we still expect the blended year one cap rate to be in the mid-four range, as we remain focused on finding both strategic and FFO accretive opportunities.
Our third-party managed portfolio totaled 357 stores at quarter-end. And it's proven to be the robust acquisition pipeline that we anticipated. Specifically 27 stores acquired this year were managed by Life Storage, representing 30% -- 36% of our closed acquisition volume so far this year. And we continue to onboard additional managed stores at a rapid pace, including 30 in the third quarter alone, as owners and developers are attracted to our operating performance and innovative technology platforms. Our team has evaluated a record number of managing opportunities this year, and the pipeline continues to grow.
With this strong performance, we are once again increasing our guidance for 2021. We have raised the midpoint of our estimated adjusted funds from operations per share to $4.94 this year, which would be a 24% growth over 2020. We have also nearly doubled the upper end of our acquisition guidance from $1 billion to nearly $2 billion.
And lastly, before handing over to Andy, I am pleased to announce that we published our Inaugural Sustainability Report this morning. This report highlights our many ESG initiatives, including our expanded solar, diversity and inclusion, and community engagement programs. The report is available on a sustainability page of our investor relations website.
So, with that, I will hand it over to Andy to provide further details on the quarter and revisions to our guidance.
Thanks Joe. Last night we reported adjusted quarterly funds from operations of $1.37 per share for the third quarter, an increase of 35.6% over the same quarter last year. Third quarter same-store revenue accelerated significantly again to 17.4% year-over-year, up from 14.7% in the second quarter.
Though we've begun to see somewhat of a return to normal seasonal trends in the past couple of months, we remain highly occupied with average same-store occupancy up 220 basis points compared to the same quarter last year. This elevated occupancy has allowed us to continue to be more aggressive with rates on new and existing customers, which has driven a significant increase in our in-place rates per square foot, which were up 14% year-over-year in the third quarter, representing substantial acceleration from the 8% in the second quarter and the 1% in the first quarter.
Same-store operating expenses grew only 3.5% for the quarter versus last year's third quarter. The largest negative variances occurred in repairs and maintenance and real estate taxes. The increases were partially offset by a 5% decrease in internet marketing expenses and slightly lower payroll and benefits.
The net effect of the same-store revenue and expense performance was a 390 basis point expansion in net operating income margin to 70.7%, result again 24.3% year-over-year growth in same-store NOI for the third quarter. Additionally, we increased our dividend 16% in October, as we continue to share growth in FFO with our shareholders. This increase follows our 4% dividend bump this past January, and the 7% growth in our dividend last year.
Our balance sheet remains strong. We supported our acquisition activity and liquidity position by issuing equity securities and pricing a bond offering during the third quarter. Specifically, we completed an underwritten public offering of common stock, generating approximately $350 million and issued an additional $130 million of common stock via our ATM program. The company also issued roughly $90 million of preferred operating partnership units as part of the consideration for our portfolio acquisition during the quarter.
Finally, we issued $600 million of 10-year, 2.4% senior unsecured notes that priced in late September and closed in early October. Our net debt to recurring EBITDA ratio was 3.9 times at quarter-end and 5.1 times following the completion of the notes offering in October. Our debt service coverage increased to a healthy 6.3 times at September 30th, and we had $500 million available on our line of credit at quarter-end.
We have no significant debt maturities until April of 2024, when $175 million becomes due. And our average debt maturity is 6.3 years. We have substantial liquidity available to continue growing our asset base with investment opportunities that provide our shareholders with attractive risk adjusted returns.
Regarding 2021 guidance. We increased our same-store forecast again, driven primarily by higher expected revenues and slightly reduced expense expectations. Specifically, we expect same-store revenue to grow between 12.5% and 13.5%. Excluding property taxes, we expect other expenses to increase between 1.75% and 2.75%. While property taxes are expected to increase 6.75% to 7.75%. The cumulative effect of these assumptions should result in 17% to 18% growth in same-store NOI.
We have also increased our anticipated acquisitions by $900 million to between $1.7 billion and $1.9 billion. Based on these assumption changes, we anticipated adjusted FFO per share for 2021 to be between $4.92 and $4.96.
And with that operator, we will now open the call for questions.
Ladies and gentlemen, the floor is now open for questions. [Operator Instructions]
Your first question for today is coming from Juan Sanabria. Please announce your affiliation, then pose your question.
Hi. Juan Sanabria from BMO. Good morning team. Just hoping you could speak a little bit more about the acquisitions you've completed and what's under contract. I think Joe, you mentioned the midpoint [ph] going in yield -- or year one yield. I'm just curious on the expectation for what we should think of that from a stabilized perspective, the assumptions behind that. And then as part of that, the funding you guys have been active on the equity and the debt front, so how we should think about the funding for what's left to come and where pro forma leverage goes?
Sure. Hi, Juan. Funding, obviously we did our capital raise and also issued some debts. So, we're all set for the current pipeline and deals that have closed. And in terms of the underwriting of the deals, yeah, we -- the blended cap rate, there's so many stories to talk about, but we feel comfortable that the year one cap rate is around 4.5% and stabilized cap rate, depending on the locations and so forth, probably an average of 5.5%, but definitely there was some in the 6% range and some of the lower 5% range really depends on the geography and so forth, but we feel very good about it.
I think the deals that we closed in the first half of the year are all meeting or exceeding our underwriting, so that gives us a real good sense as to what we should expect in year one for all of its stores under contract. So, feel very good about it.
Great. And just curious on the margin story, you kind of highlighted that in the intro. You seemed to be buying more and maybe higher growth Sun Belt markets. Just curious on how we should think about margins going forward as you got it pretty significantly here to the portfolio and maybe the uplift on rate per square foot. And how you think that maybe evolved through your portfolio.
Sure. I mean, that's definitely been one of our strategic pillars for the last few years, Juan. If you look back for the last three years of the deals we've been buying, they've been newer stores, bigger stores, more revenue per stores. We've been entering markets with better rates per square foot.
And obviously, it takes time to move the needle, but you can kind of see where our average rate per square foot has been going. It's been going up. And we're not always going to have stores in those situations, but I would think the vast majority of everything that we acquire has tended to be better than our portfolio average. So, this has been a great year for us and we expect that trend to continue. I spoke about in our remarks some of the highlights cities that we are expanding in, the Seattle, San Diego, a lot of Florida markets, they are all doing very well. We are very excited about the transformation of the portfolio that really began five or six years ago.
Thanks, Joe.
Yeah.
Your next question is coming from Todd Thomas. Please announce your affiliation, then pose your question.
Yeah. Hi, good morning. It's Todd Thomas of KeyBanc.
Hi.
Hi. First question, I just wanted to see if you could talk about the fourth quarter implied guidance a bit, Andy and maybe help us bridge to the $1.29 per share at the midpoint of the FFO range relative to the $1.37, that you reported this quarter.
Sure, Todd. When we look at what we expect in the fourth quarter, some normal returns to occupancy decline that we would normally see the seasonality. So, we would probably peak from July to December. Look at -- probably occupancy down 230, probably another 100 basis points down here from October. October was very similar to September, and that was -- I think it was 20 basis points decline in occupancy. So, we're still very good spread to last year. October was up 120 basis points.
So, on the same-store, it gets to be a tougher comp, right? So, we'll have a tougher comp there, first last year, but when you bridge it to the FFO, Todd, look at what we did with equity and debt, right? We raised a decent amount of equity during the quarter. The debt came in early fourth quarter. Most of the fourth quarter acquisitions are delayed until December. So, we have some drag from those raises, but we're in good shape. We'd like where our capital stack is. Our funding for our acquisitions is set in place. And that is what really causes those additional shares. And that $600 million bond offering will cause the FFO in the fourth quarter and the delay from the acquisitions to be at that 1.29 midpoint of show.
Okay. That's helpful. And then I think you said leverage ticked up from 3.9 times at the end of the third quarter to 5.1 times after the notes offering. Is that pro forma leverage for the notes offering and acquisitions that you expect to complete by year-end? And what's your sort of near term leverage target.
Yeah. That does pro forma and the acquisitions, but our leverage target, when we say it's between five and six in the quarters where we like to keep it in that range. So, I wouldn't expect any change from that.
Okay. Got it. If I could just sneak one last one in here, just around acquisitions. Joe, there -- previously there was an effort to add, some California and West Coast properties to the portfolio. And the company did expand in California primarily, I think in the years leading up to the pandemic. You talked about a lot of the Sun Belt exposure and some of the higher growth markets that I guess, you're adding to, with the acquisitions here, but what's the position on California and the West Coast today.
Yeah. Todd, obviously it's not the easiest market to buy. There's typically not a lot of sellers. I think if Prop 13 ever changes that might open up the flood gates, but we are very opportunistic. We managed to find a few in San Diego, which is terrific. We've been adding to Sacramento over the years and we'll continue to look at opportunities as they come up. But it's definitely a market that we would like to increase our exposure to. And we feel very good about California in the long-term.
Okay. Thank you.
Okay. Thanks, Todd.
Your next question is coming from Elvis Rodriguez. Please announce your affiliation, then pose your question.
Good morning. Elvis Rodriguez from Bank of America, and thank you for taking the question and congrats on the quarter. Joe, perhaps you can update us on your micro fulfillment business. Number of stores today, where you think this platform could go and what the first mover advantage you think gives you long-term with this business?
Sure. Hi, Elvis. We're excited about it. Our warehouse anywhere business really consists of two product -- really two real different products. One is geared for the large corporates and that's our enterprise, that doesn't involve micro fulfillment centers. The enterprise business is much more mature. It targets large corporates. It supports them and their desire to use Self Storage for their inventory needs, because we can provide inventory tracking technology. And we've seen that business grow nicely. We had a very large contract that we talked about over the summer and there's another RFP we're working on.
So, I think that's an untapped market. And as more and more people work-from-home and service techs need to have product closer to the homes, we think that's going to be -- continue to be a good opportunity for us. And again, we differentiate ourselves quite nicely in that space.
The micro fulfillment center, the Lightspeed product, obviously that's a newer product for us. There's a lot of investment in that space from a lot of startup companies and so forth. But we have the real estate and we're building the know-how. Currently, we have micro fulfillment centers in Atlanta, Chicago, Vegas. We opened up a larger one in Columbus, Ohio is kind of a hub for us and we are currently, I think, close to opening Los Angeles and Dallas. So really we'll have a nice spread across the country. And we feel very good about the business.
I think our Columbus opened up a couple of months ago and we already signed on 10 customers. And we think the more we learn about the business, the more we build out our infrastructure and continue to build on our technology, we'll see how we do in terms of attracting more customers. But obviously, it helps us leverage our real estate, and e-commerce is not going away. Supply chain issues are not going to go away anytime soon. And I think we can be a real player in that business.
Thanks. And then just a follow-up for Andy. On repair and maintenance expenses, so they went up 20% in 2Q, close to 15% in 3Q, anything in particular that's going on this year that you think could be a benefit next year from this at line item?
I think there was a few unusual items in there, Elvis. One of them was the -- there were some storm damage from some of the storms that came through. We also have one expansion that we have been pursuing and we could not get it through the municipality. And we had to write-off those costs that had committed to that expansion that was relatively minor, but it moved the needle on that number.
So, those were the two unusual items. Otherwise, it's just a tough comp to last year where we couldn't find contractors to do some of the work. And so we had a reduction last year and this year we're -- just it's a tougher comp, but there's a few usual items, but outside of that I wouldn't expect much difference next year.
Thank you.
Your next question is coming from Samir Khanal. Please announce your affiliation, then pose your question.
Good morning. Samir Khanal from Evercore ISI. Hey, Andy. Maybe expanding on the prior question. You haven't given guidance for 2022, but just maybe walk us through the various line items for expenses. I know you spoke a little bit about repairs and maintenance, which is kind of what I can through, sort of payrolls and maybe property tax and maybe other line items we need to think about for next year.
Yeah. I think, we're in an industry that's in a good place and that we have about one and a half FTEs per store, but we do see hourly wage pressure at the store level. We're -- looking at some different items that could help us through there, some technologies that could help us control that cost. But I think the hourly rate -- wage we will have pressure on. So there, I would expect a higher than normal pressure on the wage line.
Property taxes, I think we're going to be in a little better shape next year than we are this year. Utilities with our ESG investments and much more solar investment, I think we'll be well controlled as they have been over the years. Repairs and maintenance, I think will be -- it'd be an easier comp and that I don't expect much pressure on that line. Still tough to find contractors and get it done timely, but I think we're controlling that cost through some changes internally and bringing on some more maintenance tax in-house to help us control that line. Right now, we don't see a lot of pressure on the insurance line that we use in March. We'll see how that flows as we go through.
Internet advertising, we've been keeping that relatively controlled, down a 5% or so over the last year. Who knows what next year holds, right? We'll have to see -- there's a couple of different levers we pull. If we see declines in occupancy or other ways to improve our revenue and internet marketing is one of those. And we'll see how the year pans out. Going into the year, we're going to be in good shape. We'll be at higher occupancy than we started 2021. And 2021 turned out pretty well. So, we'll see how that goes and we'll see how controlled that line can be.
Thanks for that. And then I guess, Joe, just shifting over to supply at this point, maybe provide us with sort of what's your current view on supply and in any markets we should be sort of tracking or you're seeing sort of a pickup in supply in the recent months here.
Sure. Hi, Samir. Yeah. Not a ton different from what I explained last quarter. Obviously, there's more supply this year, then 2020, but it's still lower than 2019. There's a lot going on with supply. Obviously, there's demand and I'm sure there's a lot of developers looking to build, but I think that the increase in material costs can be quite significant. And then, obviously, there's a lot of delays going on with subcontract work.
So, we still think that 2020 -- 2022 is going to be similar to 2021 in terms of deliveries, maybe around 150 or so, that affect our stores. And we try to monitor as best we can, new planning to give us an idea of maybe where 2023 will go. We're not really seeing a big increase in planning. So, we feel pretty good about the next 18 months or so, and no real markets that would stand out, which is a good thing, I guess. I think we -- maybe we are seeing a little bit in New York region and then in Las Vegas. Other than that, I think that your usual suspects of the Nashville, the Raleigh and so forth still absorbing some of that new supply.
But in summary, I think we feel pretty good about 2022, and then we'll see how it goes as we enter that year to try to get a better feeling for 2023.
Thanks, everybody.
You are welcome.
Thanks, Samir.
Your next question is coming from Smedes Rose. Please announce your affiliation, then pose your question.
Hi, good morning. This is [indiscernible] on for Smedes Rose with Citi. Can you just give us some spot numbers on October occupancy? And then just as occupancy remains elevated, I think you mentioned higher going into 2022, then you were going into 2021. Even as you've been able to increase rates, can you just talk about updated thoughts around customer length of stay and when you would expect the rate increases to have an impact on occupancy or as the pandemic had a permanent impact on customer behavior?
Hi, Smedes. October occupancy was 94.4 at the end of October, that was up 120 basis points over last year's October occupancy. So, from an occupancy point of view, things are holding up well. We expect to end of the year probably 50 basis points over last year's occupancy in December. So like I say, that does start us off nicely for the New Year.
Length of stay?
Length of stay, we haven't -- we've saw an uptick throughout the pandemic. Our median length of stay increased. Our average length of stay is -- has only measured on move-out, has been 16 plus months. So, those are both crept up. Our number of customers over one year and two year of also crept up. So, we're seeing good trends there. When does it return to normal? That's to be seen. We've been aggressive with our rent increase letters. How often we do them and how high they are percentage wise? And they've been sticky. So, I think that continues until the data tells us otherwise.
Thanks. And then I guess just another one, we thought you and your peers raised acquisition guidance. Do you expect acquisition volumes to remain elevated in 2022?
Well, that's a great question. Obviously, there were some very large portfolios this year and there's some debate whether that was due to some of the potential changes in the tax laws. But I would think that there will still be some sellers next year, probably more than we've seen in previous years. Not sure if it will be as much as 2021 though, given the size of some of these large portfolios.
But again, we like to look at our acquisition -- I'm sorry, our third-party managed portfolio. We do a good job of buying from our partners and the owners, that we work with. And again, we are more than happy to do the onesie twosies, singles and doubles, work really hard. And we typically don't go after highly marketed deals. The pricing can get a little out of control. So, we're going to continue with our strategy and we'll see how it goes.
Obviously, we like what's been going on. The last couple of years, we've been able to add to our portfolio and we've been able to find very good deals. And to Juan's question earlier on, we're continued to try to get into larger markets with better demographics and we'll continue to have that focus. So, we'll see how it goes, but we're more than ready to continue to expand through expansions.
Thank you.
[Operator Instructions]
Your next question is coming from David Balaguer. Please announce your affiliation, then pose your question.
Good morning. David Balaguer from Green Street. I just wanted to go back to warehouse anywhere. I mean, a lot of that sort of supply chain disruption that we've seen this year, is that led to potentially more inbound on the enterprise side?
Say that again, the question about enterprise.
Yes. With one of the national supply chain issues that we've heard and some of the just-in-case inventory needs nationally for a lot of say, retailers out there. Has that led to more enterprise inbound volume for that portion of the warehouse anywhere business?
Sure. Enterprise, it's definitely more on the Lightspeed side. The micro fulfillment, we're seeing smaller SMEs trying to figure out their logistic needs. The enterprise really is a unique product, not so much about supply chain, but really about getting product closer to employees. So, for example, medical device companies, we have a lot of service tech industries, like the ATM providers, companies that manufacture cars, but don't have dealers, they need to have product close to their service technicians who are working remote. So, it's really getting equipment closer to service techs, so that they can just-in-time do their repairs and so forth.
So, we haven't really seen a significant rise through the supply chains for that business. But we are seeing is a lot more inbound calls on the logistics and the -- for our Lightspeed product and trying to get those e-commerce customers, who are buying, or who are selling through the internet and the companies that are trying to get their product to compete with the likes of Amazon who are now same day delivery. So that's really -- that opportunity is growing because of supply chain concerns, but not so much our enterprise product.
Got it. And then just on the revenue growth side, obviously rate trends have been extremely positive this year. But looking at the sort of existing rents out there, should we be expecting more existing rate increases throughout the year? Or are you roughly at parody with street rates in your portfolio?
No, it's got some room. Our current customer -- 60% of our customers are still below the street rate, David. So, we've got some nice room there. So, I think it sets us up nicely to be aggressive again in 2022 from an in-place customer run increased side.
Great. Thank you.
You are welcome.
You do have a follow-up question coming from Elvis Rodriguez. Elvis, your line is live.
Just a couple quick ones guys. On the JV in Brooklyn, are you able to share more details on that asset and that investment?
That's an investment, Elvis, that we've had a partial, a smaller joint venture ownership and over the years. One of the partners wanted out. So, we purchased that partner's share. We still have another partner in, and then maybe down the road, we'd buy the remaining part. That's on McDonald Avenue.
Yeah. We have a pretty good partner there, a developer that we've been managing for, and this is our second store that we've purchased from them off market in the boroughs. And it's a great relationship. We don't typically do ground up development on our own. We'd like to do it with a JV partner, with the idea of buying it, at some point in lease-up. And it's a great relationship and I would expect similar opportunities like that in the future.
Great. Thank you. And then Joe or Andy, one quick one on the third-party management platform, you commented on trying to -- wanting to grow that platform aggressively and profitably, but you don't split out sort of the revenue and expenses for that platform as some of your peers do, are you able to share is a platform profitable today? And if not, when do you believe you'll achieve profitability?
Yeah. That platform is plot profitable. We break out the revenue. It is grouped in the supplement on a separate line item in the back the expenses -- our group with warehouse anywhere and some other items, but that's profitable. There's about a 40% margin on that business. So, it is relatively profitable and we'll continue to grow that platform and it becomes more profitable as you do grow it, obviously there's kind of these of scale there, but a lot of what you do with management is in your G&A, right? So, we don't break our G&A out and allocate some of it to the managed stores. It would be arbitrary. Some do that, but it's not simple to take your G&A and split it between a managed store and a wholly-owned store.
Got it. That's very helpful. And then Joe, just one quick one on that, you mentioned the third-party platform being a pipeline for future deals, and you did some odd 30% of your deals this year from that platform. Do you foresee that -- do you foresee, as you onboard sort of the clients that you have in the pipeline today, creating a bigger pipeline of acquisition deals in the future?
Yeah. Without a doubt, I think, as we continue to grow that portfolio, you end up developing terrific relationships with the owners and we have a very good reputation as buyers out there. We have repeat sellers who have come to us because we know we can get a deal done quickly and fairly. And we would expect to be able to continue to do that going forward. So, that's one of the -- when you ask is, is third-party management profitable, it's hard to quantify that intangible. How do you measure being able to buy product off market when there's so much competition for marketed deals? So, there's definitely some intangible value there and we would expect that opportunity to continue to grow as we continue to build out that portfolio.
Great. Thank you.
Thanks.
You have another follow-up question coming from Todd Thomas. Todd, your line is live.
Yeah. Thanks. Just quickly -- I had a couple of questions on the ECRIs. Andy, you mentioned that 60% of customers are still below street. Did you share where in-places relative to street. And then that 60%, I'm just curious how that sort of compares to sort of historical levels and how many customers in the portfolio overall today are eligible for rent increases as you turn towards 2022.
Yeah. Todd, every one of our customers is eligible for a rate increase, right? But I mean, they have to be with us so many months. So, it's -- the first one uses about five months in is when we see that first increase. We've been more aggressive on that first one when it goes in place. And the second one beyond that we've been more aggressive.
When I look at the overall portfolio and we've got 60% under -- we've got about 30% -- 30% some odd above street rate at the moment, when you blend them all together, there's just slightly below street rates at this point. But it's obviously street rates decline this time of year. They'll increase as we go through the summer next year. And we would expect to have a good pool to increase next year.
So, I think it's going to be -- rates are going to be the story next year. I can't see so much, but rates, whether it's -- we've got some nice roll-up going on and the ability to increase our current customers and watch that move out rate. And we haven't seen any significant fluctuations in that. We'll continue to be aggressive next year.
And so the -- in the 30% that are above street today, you've been -- you've continued to push rates -- rent increases through to that portion of the customer base as well.
That is correct. Yes. It doesn't matter how much they're above or below street. If they're still in a pool, it may switch when we do those types of customers, what time of year. But we will -- street rate, whether they're above or below is just one of the factors, but it does not eliminate them from getting an increase.
Okay. And the revenue growth in the quarter, 17.4%. So a little over 200 basis points, so that was related to occupancy. If you look at the other -- sort of 15% plus, what's the breakout look like in terms of the contribution between ECRIs and higher move-in rents, that you achieved in the quarter?
I think it was relatively split, pretty evenly. You look at our ECRI and your averages are in the mid teens. And you're looking at our street rates, they were, our move-in first, move-outs were the upper teens, 20%, I should say, there's a quarter. So it's relatively split. Our rent roll up first in-place, so it's pretty even.
Okay. All right. Great. Thank you.
Thanks Todd.
Ladies and gentlemen, that is all the time we have for questions today. I would now like to turn the floor back over to Joe for any closing comments.
Well, thank you everybody for dialing in today. We look forward to talking to many of you over the next couple of weeks, and if we don't speak, have a happy Thanksgiving.
Thank you. Ladies and gentlemen, this does conclude today's conference call. You may disconnect your phone lines at this time and have a wonderful day. Thank you for your participation.