BNL Q3 2026 earnings call transcript, October 29, 2026

Hello, and welcome to Broadstone Net Lease's third quarter 2026 earnings conference call. My name is Matthew, and I will be your operator today. Please note that today's call is being recorded. I will now turn the call over to Brent Madel, Director of Corporate Finance and Business Analytics at Broadstone.

Please go ahead.

Thank you, everyone, for joining us today. for Broadstone Net Lease's third quarter 2026 earnings call. On today's call, you will hear prepared remarks from Chief Executive Officer John Marano, President and Chief Operating Officer Ryan Albano, and Chief Financial Officer Kevin Fennell. All three will be available for the Q&A portion of this call. As a reminder, the following discussion and answers to your questions contain forward-looking statements, which are subject to risks and uncertainties that can cause actual results to differ materially due to a variety of factors. We caution you not to place undue reliance on these forward-looking statements. For a more detailed discussion of risk factors that may cause such differences, please refer to our SEC filings, including our Form 10-K for the year ended December 31st, 2025, and note that such risk factors may be updated in our quarterly SEC filings. Any forward-looking statements provided during this conference call are only made as of the date of this call. With that, I'll turn the call over to John.

Thank you, Brent. Good morning, everyone. Before turning to our quarterly results, I would like to quickly address the stark change in the capital markets and macroeconomic environment that we have all experienced recently. While the moves have been materially negative over the last quarter, since this management team took over in 2023, our team has consistently demonstrated our ability to operate this business through broader market volatility of all kinds. We will continue to operate the playbook that has worked since we started on this journey. Disciplined execution, creative thinking, and controlling our own destiny. As many who have heard from us over the last couple of years, our degree of selectivity has remained elevated for some time, and recent market moves serve more as a validation of our position than as disruption to our plans. In fact, this is exactly the kind of environment we built our strategy for in the first place. Strong same-store growth and prudent balance sheet management combined with a differentiated growth strategy that provides long-term visibility into attractive growth without reliance on the usual heavily marketed net lease acquisition channels works in any environment. but particularly one suffering from the type of volatility and uncertainty that we are seeing today on to the results the third quarter was a continuation of the progress we have been driving toward all year and really over the last three years we generated a ffo of 39 cents per diluted share a 5.4 percent increase over the third quarter of last year we returned to the public equity markets for the first time in four years completing a 259 million dollar forward equity offering we started three new

build suit developments totaling 326 million and six others reaching stabilization during the quarter with our capital already at work and our path forward clearly defined we believe we enter the fourth quarter well positioned to deliver on our full year guidance and to carry our momentum into 2027. during the third quarter we invested 236.6 million comprised of 63.8 million in a single industrial acquisition 137.1 million and build the suit developments 35.1 million in transitional capital and 0.6 million in redevelopment the acquisition and approximately 544,000 square foot industrial property was completed at an initial cash capitalization rate of 7.7 percent with a 15-year lease term and 2 percent annual rent increases resulting in a straight line yield of 8.8 percent the three build to suit developments we started this quarter total 325.8 million of estimated project cost at a weighted average initial cash capitalization rate of 8.8 million. rate of 8.4 percent in a straight line yield of 11.3 percent in addition to our colorado project we started two retail projects in manor texas for hobby lobby and academy sports as noted earlier we stabilized six build to suit developments during the quarter totaling 95.3 million of estimated total project investment at a weighted average cash capitalization rate of 7.3 percent additionally subsequent quarter end our 115 million southwire project reached stabilization with a first year cash capitalization rate of 7.3 percent additionally subsequent quarter end our 115 million southwire project reached stabilization with a first year cash capitalization rate of 7.3 percent

adding to the success of the quarter today our in-process build-a-suit pipeline now stands at approximately 456 million of which approximately 150 million has been invested leaving approximately 306 million of remaining estimated investment from that in-process pipeline we expect approximately 36 million of incremental annualized base rent to come online between the fourth quarter of this year and the end of 2027. approximately 2 million of that arrives in the fourth quarter approximately 31 million arrives in the first half of 2027 as colorado and other projects reach rent commencement and the balance follows in the back half of 2027 that equates to over 8 growth on our current abr of 449.5 million from projects that are already committed under construction and capitalized providing a degree of forward visibility in the growth that is rare in our space this portfolio continues to perform as designed we ended the quarter approximately 100 percent occupied on a square footage basis with all but one of our 767 properties subject to a lease and as of the date of our release we had collected 99.9 percent of base rents due for the quarter we also remained active with dispositions selling three properties during the quarter for gross proceeds of 12.5 million at a 6.6 percent capitalization rate that brings our year to date total to 13 properties sold for gross proceeds of 86.7 million at a weighted average capitalization rate of 6.3 percent on

tenanted properties project tri borough remains a key priority for us and we remain cautiously optimistic that we will achieve the 2026 goals we set out for this project at the beginning of the year ryan will provide a more detailed update shortly including our progress towards this year's major milestones on the capital front we took a significant step this quarter completing our first public equity offering in four years selling 12.65 million shares at $20.50 per share for estimated gross proceeds of approximately two hundred fifty nine million in connection with forward sale agreements together with approximately 167 million of forward sales under our ATM program at a weighted average gross price of twenty dollars per share we now have approximately 409 million of expected net proceeds from unsettled forward equity that capital positions us to fund our committed pipeline regardless of the ongoing volatility in the capital markets our approach has not changed we will remain disciplined and opportunistic across all of our capital sources and we will continue to make match fund our investments. Kevin will take you through the details of our balance sheet and funding plan in a moment. Based on our year-to-date performance and the visibility our Build the Suit pipeline provides we are reaffirming our full year 2026 AFFO per share guidance of $1.55 to $1.57 with a midpoint of $1.56 representing nearly 5% earnings growth over 2025 and we are raising the ranges for both investments and dispositions. The momentum we are carrying into the fourth quarter in 2027 is the product

of years of disciplined execution, deliberate portfolio construction, and a build-to-suit platform and differentiated growth strategy that is delivering at scale. I am excited about what we have in front of us and happy to hand the call over to Ryan and Kevin, who will each walk you through more of what is driving our confidence.

Thank you, John, and good morning, everyone. This quarter showed our platform working at scale. We started $326 million of new build-to-suit developments, stabilized another $96 million, dollars. and continue to advance our redevelopment projects in Project Triborough. Let me walk you through where the pipeline stands today, how our in-place portfolio is performing, our redevelopment activity, and then provide an update on Project Triborough. Starting with the pipeline, as of today, our in-process build-to-suit investments now total approximately $456 million across seven projects, roughly 83% of which are industrial. What the pipeline stands today? The pipeline carries a weighted average estimated cash yield of 8%, a weighted average straight-line yield of 10.4%, supported by a weighted average lease term of 14.8 years, and annual rent escalations of 2.7%. These are tenant-driven, mission-critical developments structured from the outset to mitigate the risks that typically accompany ground-up development. The six projects we stabilized this quarter, two industrial and four retail, are now contributing to ABR, and several more are expected to follow close behind. Our Southwire facility in Bremen, Georgia, a $115 million, 1.2 million square foot project, also reached stabilization this month, and our Academy Sports Project in Magnolia, Texas, is targeted for November. Turning to our in-place portfolio, occupancy was approximately 100% on a square footage basis at quarter

end. Third quarter same store rental revenue grew 0.7% year over year. Contractual rent increases contributed 1.9% of growth across our same store portfolio, including 2.1% for industrial. The headline number was held back by approximately $1.2 million of prior year rent from two industrial properties that are now under redevelopment. Excluding those two properties, same store growth would have been approximately 1.9% in line with our year to date growth. We have had strong execution year to date on both 2026 and 2027 lease renewals, achieving a 111% recapture rate. As we look ahead to 2027, our track record gives us confidence in both managing upcoming expirations and finding opportunities to create value through our redevelopment efforts. Redevelopment continues to be a differentiated source of value creation. Our first project, the conversion of a functionally obsolete office asset in the Chicago MSA into approximately 156,000 square feet of industrial space, is progressing. Total estimated project investment is approximately $17.9 million, of which approximately $3.7 million has been invested to date. The property carried originally ABR of approximately $1.4 million, and we expect stabilized ABR of approximately $2.7 million with substantial completion targeted during Q2 of 2027. We are in active conversations with multiple prospective tenants who are potentially interested in this property. Our second project is our Hoffman Estates Illinois property, which we moved into redevelopment at the start of the third quarter after evaluating re-leasing the property,

a vacant sale, and several redevelopment scenarios prior to the lease term ending. We estimate a total investment of approximately $28.4 million, including the property's remaining basis, and plan to repurpose the existing structure. Target stabilization is anticipated for Q3, 2028, with estimated stabilized ABR of approximately $3.3 million, in line with the original property ABR. ABR. While significantly reducing the office component of the building's square footage, and meaningfully improving the quality of the building and overall value. Now, turning to Project Triborough. As a reminder, this is a large site in northeastern Pennsylvania, more than 550 acres of land with a committed one gigawatt power supply. We have approximately $154 million invested in the project as of September 30th. As you all have heard many times before, we did not underwrite Project Triborough as a single outcome investment, and each of the three distinct paths create real value for shareholders. Monetizing the land in the near term, building a hyperscale data center campus, or building four large box industrial buildings. We have continued to invest in this opportunity while creating value and maintaining optionality for all paths forward. On site work, we continue to progress horizontal activity that is common to both an industrial and a data center development. And the first of four building pads is nearly ready for vertical construction. Various stages of horizontal work continue across the remaining land.

On power, we continue coordination efforts with PPL and are in the process of finalizing our ESA and CSA. Our onsite substation design and engineering continues to progress. And timelines remain intact for the initial power delivery anticipated during the first half of 2028. On zoning, we have continued to engage in constructive dialogue with the borough to advance the project under consideration and address the concerns of the borough's residents. In all cases, we expect clarity on zoning, power, and tenant demand this year, which supports our target of deciding among our three paths by year end. We remain very excited about the value creation. opportunity that Triborough represents and look forward to communicating our progress in the near term. With that, I'll turn the call over to Kevin.

Thank you, Ryan. During the quarter, we generated adjusted funds from operations of $77.8 million, or $0.39 per share, representing a 5.4% increase over the third quarter of 2025. Results benefited from same-store rent growth, recent investment activity, and from build-to-suits reaching stable. General and administrative expenses were in line with expectations, with core G&A of $7.4 million, trending towards the low end of our full-year guidance of $30 to $31 million. With respect to the balance sheet, we ended the quarter with total debt of $2.9 billion and pro forma net leverage of 5.4 times, down from 5.9 times last quarter, reflecting the forward equity we raised that we intend to settle alongside rent commencement in future quarters. Between the August offering that John already highlighted and our ATM activity, our total outstanding expected net proceeds from unsettled forward sale agreements were approximately $409 million as of September 30th. On our last call, we also discussed our new $300 million senior unsecured delay draw term loan, and we have drawn $100 million to date. Additionally, with $428.8 million available available. on our revolving credit facility at quarter end, we have over $1 billion of in-place liquidity available to fund the $337 million of remaining estimated investment in our bill-to-suit projects, as well as additional opportunities. Looking ahead, we will continue to assess all potential sources of funding, managing around a pro-forma leverage target of six times. Last week, our Board of Directors increased our quarterly dividend by 1%.

to 29.5 cents per share, payable to holders of record as of December 31st, 2026, on or before January 15th, 2027. Now turning to guidance. Given our year-to-date performance and the visibility from our bill-to-suit pipeline, we are reaffirming our full year 2026 AFFO guidance range to $1.55 to $1.57 per diluted share. This guidance is based on investments of $700. to $800 million revised higher from $600 to $800 million. Dispositions of $150 to $200 million revised higher from $100 to $150 million. And no change to total core G&A expenses of between $30 and $31 million. Given our portfolio performance to date, we are also reducing our bad debt assumption to 25 basis points. As always, it is worth reminding everyone that our per share results for the year are sensitive to the timing, amount, and mix of investment and disposition activity, as well as any capital markets activities that may occur during the year. Our guidance now includes less than half a penny per share of estimated dilution from approximately 350,000 to 600,000 weighted average shares related to our outstanding forward equity under the Treasury stock method. Please reference last night's earnings release in supplemental for additional details, and we will now open the call up for questions.

We will now begin the question and answer session. Please limit yourself to one question and one follow up. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. We ask that you pick up your handset when asking the question to allow for optimum sound quality. If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster.

Your first question comes from the line of Eric Borden with BMO Capital Markets.

Your line is now open. Please go ahead. Great. Thanks for taking my question.

The first question is just on Triborough. You know, it's encouraging that you're still working towards a decision by your end. But as you sit here today, which of the remaining items is most important to determining that path forward? You know, whether it be. Donating the power agreements or getting a tenant commitment. Thank you. Thanks, Eric. It continues to move forward. We've had really good, as Ryan said, constructive dialogue with the borough, trying to make sure that we're going about this the right way and responding to local resident concerns and providing sort of the best possible sort of mutually beneficial answer for this moving forward. I think, you know, we've heard us say all year that there's three things here. There's zoning, there's power, and there's the tenant. And I think in terms of order of priority, they fall. In that order, you know, we can't have the conversation around power or the conversation around the tenant unless we know for sure that we've got the data center zoning squared away. So that's where a lot of our attention has been. That's not to say that we haven't continued to work constructively with PPL as they think about their transmission distribution lines, the construction of the substations is going to be on the property, the ESA and CSA, as Ryan had said, and that we have not continued to have a good sort of preliminary dialogue with potential tenants. But of course, the tenants are waiting for that zoning to be taken care of. So most important thing for us

is that we have to be taken care of. Is to have that tenant, excuse me, the zoning squared away. And our expectation is that that should happen by the end of the year. And then we can move forward with the other two pieces in short order thereafter. Great. Thank you. And then maybe just switching gears a little bit, you know, to looking ahead to 2027. I understand that you're not providing guidance, but, you know, the rent commencement schedule gives us, you know, a helpful starting point. But how should we think about the main offsets between, you know, your embedded rent growth? And the AFFO per share growth. I understand that, you know, interest expense and G&A are large contributors, but curious if there's any other offsetting factors there. Thank you. Eric, it's Kevin. I think you've got them pretty well targeted, you know, a variable that seemingly changes every day. Certainly every week is the interest rate environment. And so, you know, that's one we'll get sharper on as we cross the calendar here, but you've got the right ones to be focused on.

Your next question comes from the line of Anthony Pallone with JP Morgan. Your line is now open. Please go ahead.

The more traditional acquisition side is going to be a winning formula going into 2027. Got it. Thank you. And then you've talked about in the past, just leaning more towards a bit more self-funding through dispositions of the things you develop over time. And I'm just wondering if you think that's been impacted by the change in the rate environment. And in particular, I think you're now in the clear-to-sell zone on UNFI. And I think that's been one in the past you've talked about that could be a potential large- source of capital at an attractive price. And so, any implications there to the thinking with the change in the environment? Yeah. So, I may actually just start with sort of how we're thinking about what we have in place right now from a dry powder standpoint. We've got $500 million or more of dry powder in hand right now that we can deploy into good, attractive, accretive investments with an in-place cost of capital based off of the work that Kevin had done this year in the equity and debt capital markets in the low to mid-sixes. So, we've got dry powder that we can deploy. And have it be accretive to earnings. And we don't have to be thinking too strongly about the dispositions like we did in 2023, 2024, when we were working through our portfolio repositioning. That being said, we are doing more. I mean, as you saw, we increased our disposition guidance for the year. That is both a combination of incremental assets that Mike Caruso and his team have been working on, thinking about selling, finding good opportunities to move them along, and then also sort of the traditional risk mitigation type stuff that we would do.

Built into that is a bit more of a chunkier one. We are contemplating a sale of our transitional capital investment in our Sunset Hills Retail Center. So that is a big piece of why we increase the guidance for the year. We'll be able to, if we execute on that, we'll be able to redeploy that into the existing pipeline, as well as sort of pair that up with the capital that we've got from a dry powder standpoint. So just want to emphasize first and foremost, like we've got plenty of dry powder that's at a great cost of capital for us to redeploy accretively into the investments that we're seeing, particularly our build-to-suit pipeline. uh, and then we have the flexibility to go out and drive more through our disposition strategy, which, you know, it was real nice when the sun was shining on us for a couple of months there over the summer, but we've been controlling our own destiny through sales and other activities to provide our funding for the last four years. So this isn't nothing new for us. Okay. Thank you.

Your next question comes from the line of Jay Kornreich with Cantor Fitzgerald. Your line is now open. Please.

Okay, appreciate that. And then just in terms of the amount of unsettled forward equity and thinking about the timing when you settle that should we expect that be more of a match funding approach with the. Developments or a more, you know, radical approach as you're providing capital along the process of developments match funding along completion is a more reasonable assumption. I'd say sort of mid quarter convention around that is probably pretty reasonable. Okay, thank you. I'll hold it. I'll hold it there.

Your next question comes from the line of Caitlin Burroughs with Goldman Sachs. Your line is now open. Please go.

Just to get comfortable with making sure that the economics continue to work in a fairly changing volatile world. Got it. Okay. And then just, I saw it looked like a couple of developments actually stabilized earlier in the third quarter. So, congrats on that. I guess I'm wondering if there's anything specific to call out on what drove it and if it could be repeatable, but also, as we think of the full year guidance, you also mentioned that you lowered bad debt. So, wondering if there was any offsetting factors that we should consider in terms of why the AFFO guidance was not.

I think on that timing piece, Caitlin, it's sort of project specific. You've seen us be more or less plus or minus 45 to 60 days from our original estimates. We do our best to tune those in as we get closer to completion. I don't know if there's anything thematic to call it on that piece. And on the guide, you know, the Treasury stock piece of this equation was, you know, it's less than half a penny, but, you know, when you're talking about a guidance range of one to three pennies, it's certainly a contributor to sort of holding the line on the range. Thanks.

Your next question comes from the line of Upal Rana with Key. Your line is now open. Please go ahead.

Okay. All right. That's helpful. And then maybe on Triborough, you know, I'm sure you've had plenty of conversations with potential tenants. Is there anything you can share on some of the conversations you are having? You know, is there anything particular they're looking for or asking for as it relates to the property or lease or anything that they're concerned about from the executive order that it's requiring?

Conversations have been constructive. I would continue to characterize them as very preliminary. People don't want to spend a huge amount of time digging into all the details and negotiating a lease until they know that it actually can be a data center. So that's why we're focused on getting the zoning done first and foremost. And as I said, we continue to be cautiously optimistic about that for this year. But the thing that we have heard and we continue to see is that demand is not dropping. We are continuing to hear from tenants that they have real demand for these types of projects and they're looking for these types of projects. One of the things that has positioned us, we think, and we hope to be in a much better position than others is that we have continued to pursue the horizontal site level work on this. So in terms of being able to sort of hit the gear a little bit harder to shift it from the work that we've done today to starting construction on the substations, the initial buildings that would be a part of phase one and getting to delivered power sometime in 2028, you know, we think positions this asset incredibly well relative to the demand that we have. we are hearing continues to exist and the interest that we're seeing from tenants on a preliminary basis.

Okay, great. That was helpful. Thank you.

Your next question comes from the line of Linda Tsai with Truist Securities. Your line is now open. Please go ahead.

Are there a lot of interested parties from the private capital solution perspective? Yeah, there's a huge amount of interest in. Continuing to fund these things that is coupled up with the continued huge amount of demand for projects like this. So I think that, you know, with projects that are looking at delivering in, you know, back half of 27 and into 2028, like you're talking about with the initial phase delivery on power for Project Triborough and similarly situated ones where they've done the work and the site level that Ryan and his team have been continuing to advance. There is ample capital that's out there looking to be deployed into projects just like this. Thanks. Your next question comes from the line of Michael Goldsmith with UBS. Your line is now open. Please go ahead.

you know, if you look back as. Historically, our, you know, low to sort of mid 102 to 104 or 5% is really a bit more in line with sort of reasonable expectations, because often we're going to be in a situation where the tenant is going to have the option to renew at like 2% or 3% or whatever it is. And so we can come to a better solution from there. That's great. But they always have the fallback of just hitting their option and continuing to hold that sort of increasing from whatever the sort of standard lease increases. So 111% is great. And kudos to our team for being able to find some really great solutions and positive outcomes on our lease rolls for this year. And, you know, hopefully we continue to see opportunities to do that in some discrete situations in the future. But, you know, I think it's more in that low 100% range that we should be setting expectations around. Thank you very much. Good luck in the fourth quarter.

Your next question comes from the line of Ryan Caviola with Green Street. Your line is now open. Please go ahead.

I think there's certainly a political component to it. We expected after tariff day and some of the efforts by the administration to bring more manufacturing in the United States to drive some additional tailwinds for industrial. And I think that's playing out. I don't know if it's playing out to the same degree that maybe everyone expected at the outset of this. But then I think beyond the political sort of component to that, there's also sort of the tailwinds of the shifting views that a lot of the industrial and manufacturer folks have had coming out of COVID where they just knew that they needed to rethink their supply chains to make sure that they could continue to, you know, provide revenue for their businesses and not run into the problems that we've seen from sort of geopolitical issues or from sort of pandemic era style COVID supply chain issues. So there's both, I think, the political tailwind that helps a little bit. And then I think there's more of a secular market tailwind where people are looking at, you know, businesses are looking at their supply chains and wanting to make sure that they're as resilient as possible here to make sure that they're as resilient as possible. Domestically, and not having to rely as much on, you know, international shipping. Thanks. Appreciate the color. Your next question comes from the line of Ronald Camden with Morgan Stanley. Your line is now open. Please go ahead. Great. I just want to go back to the pipeline and the thinking of advanced manufacturing or data centers and so forth. One, I was just curious in terms of are there any sort of larger.

that we're doing the same thing for them to do. Evidently allocating the capital that we have to the projects that we think are going to be the most decretive and earnings powerful in the future is where we're spending our time and attention. That's helpful. And then just in this, going back to sort of the regular way acquisitions, sort of post the interest rate move, you guys have always been pretty selective, but do you think that maybe this would shake up more opportunities for BNL here? Just some thoughts on just regular way acquisitions as well. Thanks. Yeah, we have been very selective for a long time. We will continue to be. There's very little that we move on in terms of regular way deal flow anymore. We always make sure that we can stay in touch with it and we're in contact with all the brokers and making sure that we understand what's happening. If there's ever a good opportunity that's out there, we want to make sure that we're part of it. But our strategy is really focusing on these long term value creating build suits and then finding opportunities to find direct off marketed deals with our existing relationships that we can deploy. capital more creatively. And if you're looking at an environment where their cost of capital has changed a little bit, financing markets have changed a little bit, depending on how banks are thinking about lending, what the brokers are seeing, what the appetite is for people to be able to deploy capital that are the other participants in the net lease market, maybe that shakes out a few direct deals for us if people are looking for surety of execution as opposed to having to work their way through a more heavily marketed process. So we're hopeful.

Great. That's it for me. Thank you.

Your next question comes from the line of Mitchell Jermaine with Citizens JMP. Your line is now open. Please go ahead. Your line is now open. Please go ahead.

Your next question comes from the line of Michael Gorman with U.S. Bancorp BTIG. Your line is now open. Please go ahead.

project, you, we are either selling it and then taking those proceeds, delevering, and then redeploying it into our core verticals, or we're going to find a private capital joint venture solution for it. And at that point, you know, in terms of tenant concentration, it will be far lower than what it would be if you're thinking about it more of on a headline, fully on balance sheet number.

Got it. That's helpful. And then maybe just pivoting for the other growth avenues, whether it's revenue generating CapEx or maybe traditional. Sorry, transitional capital or anything. What's the financing environment like for your tenant base? I imagine they're seeing some of the same volatility that you are. And is that opening up additional opportunities in some of those other growth avenues, whether it's helping with expansion or CapEx?

Yeah, you know, their cost of capital and their financing opportunities are changing sort of in step with the way that we're thinking about it. You know, there are places where depending on, you know, are they pricing off a 10-year, are they pricing off a SOFR? You know, there's been. Significant differences in the volatility there. You know, the 10-year, depending on the day, is up whatever 60 or 80 basis points relative to the beginning of July. SOFR is up, I don't know, it was 20 the other day or something like that. So depending on how you're thinking about pricing these things, if you're doing an ABS facility or doing something else, you know, there are alternatives. But, you know, the build-to-suit structure, you know, helping from a revenue-generating CapEx with existing tenants because we already own the asset, you know, continues to provide in most instances, you know, we think an attractive alternative to anything else is going to be out there. And so we can. continue to have constructive conversations about deploying capital into all those potential verticals. Great. Thanks for the time.

Your final question comes from the line of Eric Borden with BMO Capital Markets.

Your line is now open. Please go ahead.

Great. Thanks for taking the follow up. Just on Project Triborough with the first pad nearly ready, is there an opportunity to move forward with an industrial building on part of the site? While preserving the ability to pursue a data center development on the balance? Or would the site layout infrastructure requirements make that path, make those paths mutually exclusive?

We would not pursue, if it moves forward and you have data center approvals from a zoning standpoint and you have the power and the interest, we wouldn't move forward with an industrial site on it because any of the hyperscale tenants that are looking at that project want all of it. They want all of it and then more. So, uh, you know, we would not put industrial on it to start. The only way that we're going to be putting industrial, um, on those 550 acres is if, uh, you know, we end up having to pivot towards the industrial. But as I said, we're cautiously optimistic that we'll have this, uh, resolved by the end of the year. And so hopefully then we're, we're moving fairly quickly to the conversations on, on power and on tenancy. Okay. Thank you. And then just in the event that you do have to shift towards an industrial, um, build the suit or development, would that be on a spec basis or on? Uh, would you like to have the tenant and tenant in hand before moving forward with that project? We'd always love to have tenants in hand before moving forward, but given the demand that we know that exists in Northeastern Pennsylvania for this type of large format box, uh, we'd be very comfortable continuing to move forward, including even going vertical on some of these assets if we needed to. All right. Well, thank you for the time. I appreciate it. Thank you.

There are no further questions at this time. I will now turn the call back to John Marana for closing remarks. Thanks all for joining us today. And we're looking forward to seeing many, if not all of you at in Atlanta at Nary in a few weeks. Enjoy the fall. Thanks. This concludes today's call. Thank you for attending. You may now disconnect.