Good morning, ladies and gentlemen, and welcome to AvalonBay Communities First Quarter 2024 Earnings Conference Call. Your host for today's conference call is Mr. Jason Reilley, Vice President of Investor Relations. Mr. Reilley, you may begin your conference call.

Thank you, Diego, and welcome to AvalonBay Communities First Quarter 2024 Earnings Conference Call. Before we begin, please note that forward-looking statements may be made during this discussion. There are a variety of risks and uncertainties associated with forward-looking statements, and actual results may differ materially. There is a discussion of these risks and uncertainties in yesterday afternoon's press release as well as in the company's Form 10-K and Form 10-Q filed with the SEC. As usual, the press release does include an attachment with definitions and reconciliations of non-GAAP financial measures and other terms that may be used in today's discussion. The attachment is also available on our website at www.avalonbay.com/earnings. We encourage you to refer to this information during the review of our operating results and financial performance. And with that, I will turn the call over to Ben Schall, CEO and President of AvalonBay Communities, for his remarks. Ben?

Thanks, Jason, and good morning, everyone. I'm joined by Sean Breslin, our Chief Operating Officer; Matt Birenbaum, our Chief Investment Officer; and Kevin O'Shea, our Chief Financial Officer. Sean will speak to our operating outperformance year-to-date and our positive momentum as we enter the prime leasing season. Matt will discuss the continued outperformance of our developments and lease-up and how we are strategically deploying capital to generate value. And Kevin is here for questions and is more than happy to speak to our preeminent balance sheet and liquidity profile. Utilizing our earnings presentation. Slide 4 provides the highlights for the quarter and identifies these key themes as we look ahead. First and foremost, we are off to a strong start in 2024 with first-quarter results outpacing expectations. We were able to build occupancy earlier than expected, and we also experienced meaningful improvements in bad debt in February and March. Second, we feel well positioned as we enter the peak leasing season, given low turnover, solid occupancy, and positive rental rate momentum. We also expect our suburban coastal footprint to continue to outperform, given steady and improved demand drivers. Given our first-quarter outperformance, applications for Q2, and improvement in underlying trends, we have increased our full-year guidance. We remain laser-focused on executing our strategic initiatives, including our operating model transformation. We remain on track to deliver $80 million incremental annual NOI uplift from our operating initiatives, a target we raised from $55 million at our Investor Day in November. And finally, with one of the strongest balance sheets in the sector, we are focused on growth opportunities in which we can leverage our strategic capabilities from our operating prowess to our development strength to drive outsized returns for shareholders. With that summary, let me go a layer deeper on our results, the wider supply and demand backdrop, and our increase to guidance. For the quarter, as shown on Slide 5, we produced core FFO growth of 5.1%, which was 350 basis points above our prior outlook. Same-store revenue growth increased 4.2% and was 90 basis points better than our prior outlook. Our developments and lease-up are seeing strong absorption, achieving rents and returns above pro forma. Slide 6 shows the components of the Q1 core FFO outperformance, with the bulk of the increase coming from higher same-store NOI. Revenues exceeded our prior outlook by $0.04, while expenses in the first quarter were $0.03 better than expected, though we note that $0.02 of this $0.03 is estimated to be timing-related, meaning we still expect to incur those expenses later in the year than we had originally forecasted. Turning to Slide 7, demand for our portfolio is benefiting from more job growth than originally forecasted. The National Association of Business Economics has now increased its estimate to 1.6 million new jobs in 2024, up from the prior estimate of 700,000 jobs. This improved job outlook provides an incremental lift to demand, though this may not be on the same trajectory as previously expected, as a disproportionate share of these additional jobs may be part-time and seem to be more concentrated in lower-paying sectors of the economy. The differential in the cost of owning versus renting a home also continues to benefit demand. This is particularly pronounced in our markets, given the high level of home prices, resulting in it being more than $2,000 per month more expensive to own than rent a home. This differential translates into record low numbers of residents leaving us to buy a home. Turning to supply on Slide 8. As we emphasized at our Investor Day, our suburban coastal portfolio, which is 71% suburban today and headed towards 80% suburban, faces significantly less new supply than many of our peers. In our established regions, deliveries will be 1.5% of stock this year and in line with historical averages. In the Sunbelt, by contrast, deliveries will be 3.8% of stock in 2024, significantly above historical averages. With lease-up of typical projects taking an additional 12 to 18 months, the pressure on rents and occupancy in the Sunbelt will last, at least, through the end of 2025, if not into 2026. This weaker operating performance in the Sunbelt is starting to weigh on asset values there, providing a more attractive opportunity for us to acquire assets below replacement costs as we continue to grow our expansion market portfolio from 8% today to our 25% target. With the supply-demand backdrop and our outperformance year-to-date, we are increasing our full-year core FFO guidance estimate to $10.91 per share for a 2.6% increase relative to 2023. With the detail on Slides 9 and 10, the bulk of the increase is in higher NOI driven mainly by higher revenue, with same-store revenue growth now projected to be 3.1%, up from 2.6% in our original outlook. Before turning to Sean, I'd like to take a moment to thank the team and the wider AvalonBay associate base, who continue to execute at a high level and above plan. It's energizing to see the organization executing on the priorities that we detailed at our Investor Day, a set of initiatives that we are confident will deliver superior growth in the near term and in the years ahead. And with that, I'll turn it to Sean to go deeper and provide his perspectives.

Thanks, Ben. Turning to Slide 11. The primary drivers of our 90 basis points of revenue growth outperformance in Q1 were economic occupancy, which accounted for roughly one-third of the total outperformance for the quarter, and underlying bad debt, which represented another roughly 20%. Occupancy was about 30 basis points higher than expected, increasing from the mid-95% range at the end of last year to the high 95s for the quarter. We anticipated occupancy to grow during Q1, and it increased more quickly than we expected, reflecting strength in the underlying demand for our primarily coastal suburban portfolio and very limited new supply. In terms of underlying bad debt from residents, we ended up about 25 basis points favorable to our original expectations for the quarter, with all of the improvement realized in February and March. January was in line with the budget at roughly 2.2%, but it declined materially to 1.8% in February and again to 1.6% in March, which is roughly 60 basis points below our original budget. We experienced a similar dip in May of last year, and while we're encouraged by the results in February and March, we need to see a few more months at these lower levels to feel confident that we'll experience consistently better performance moving forward. From a geographic perspective, the favorable variance to our initial expectations was more significant in New England, New York, New Jersey, Seattle, and to a lesser degree, in Northern and Southern California. Moving to Slide 12, key portfolio indicators are very healthy during Q1, and our portfolio is well positioned for the prime leasing season. In Chart 1, turnover remains well below historical norms, partly due to a very low level of move-outs to purchase a home. During Q1, only 7% of our residents moved out of one of our communities to purchase a home. Not long ago, we highlighted that 12% to 13% of move-outs purchasing a home was low. Seven percent is extremely low relative to the long-term average of 16% to 17%, and it certainly reflects the favorable rent versus own economics in our established regions, as Ben referenced earlier. Given the low level of turnover, availability has been relatively stable and supportive of above-average asking rent growth recently, which is reflected in Chart 3 and accelerating rent change reflected in Chart 4. As expected, our East Coast regions delivered the strongest rent change in Q1 at 2.7%, with the East Coast established regions trending in the 3% range, while Florida was sub-1%. We experienced positive momentum in rent change throughout the quarter across the East Coast markets, particularly notable in Mid-Atlantic, while performance in the District of Columbia has been soft and volatile due to numerous issues, including new supply impacts. The Northern Virginia and Maryland suburbs have demonstrated continued positive momentum. Rent change for the West Coast regions was 1.3% during the quarter, with the Seattle market leading at 2.8%, which further increased into the mid-4% range for April. Urban Seattle is still soft due to substantial new supply and weaker demand, but performance across our primary suburban portfolio improved significantly during the quarter. In Northern California, the indicators of better performance are emerging, though not yet significantly impacting current performance. Rent change was flat for the quarter, with a positive rent change in San Jose being offset by negative rent change in San Francisco and the East Bay. Transitioning to Slide 13 to address our updated revenue outlook for the year, we now expect same-store revenue growth of 3.1% for 2024, an increase of 50 basis points from our original guidance. The increased outlook is primarily driven by stronger lease rates, as higher occupancy at the start of the year has allowed us to begin achieving higher rental rates than we originally anticipated as we move into the prime leasing season. We now expect like-term effective rent change in the mid-2% range, about a 50 basis point increase from our original outlook. The second quarter should trend up into the low 3% range before decelerating in the back half of the year, consistent with seasonal norms. We expect renewals in the low to mid-4% range for the balance of the year, while new move-ins average roughly 50 basis points, reflecting the low 2% range for Q2 move-ins before experiencing the normal seasonal decline in Q3 and Q4. In addition, we're projecting a greater contribution from the improvement in underlying bad debt, with a full-year rate of 1.7%, down from 2.4% last year and slightly more rent relief. Finally, moving to Slide 14, you can see where we're projecting stronger revenue performance compared to our original outlook. We're expecting the most significant improvement in Seattle and New England, which outperformed our expectations in Q1 and accelerated further into April, with both regions delivering greater than 4% rent change, followed by Metro New York. The Mid-Atlantic is expected to modestly outperform our original expectations, supported by stronger performance in Northern Virginia and suburban Maryland. Southern California is also expected to perform modestly better than our original outlook, and we haven't changed our forecast for Northern California. So I'll turn it over to Matt to address recent lease-up performance and our capital allocation plan for 2024. Matt?

Thank you, Sean. Turning to our development communities. Slide 15 details the impressive results generated by our lease-ups. The six development communities that had active leasing in Q1 are delivering rents $295 per month or 10% above our initial underwriting, which translates into a 40 basis point increase in yield. This performance is supported by strong traffic and leasing velocity, with these assets averaging 30 net leases per month in the seasonally slow first quarter, which grew throughout the quarter to nearly 40 per month in March. This outperformance is driven by two primary factors. First, since we conservatively don't trend rents and report our development economics based on projected NOI at the time of construction start until the communities enter lease-up, there's usually rent growth during the construction period, which provides some incremental lift to our development yields by the time of completion. Second, while we are generally good at predicting how the market will respond to our latest product offerings and new development, we often see some additional premium as the market reacts positively to features we incorporate into our designs. Turning to Slide 16. While it was a quiet quarter for investment activity with no closed transactions or development starts, our investment plans for the year are still very much on track. We brought four assets in our established regions to the market in Q1, looking to take advantage of a potential lull in the investment sales market as many owners were waiting for interest rate cuts before commencing their disposition plans. All four are now under agreement at pricing consistent with our initial expectations, with a weighted average cap rate of 5.1%. We expect to redeploy some of the proceeds from these pending sales into acquisitions in our expansion regions in the coming months as we continue to make progress on our portfolio optimization objectives to increase our expansion market allocation to 25% over time. Planning for development starts is also proceeding as expected, with our start activity this year concentrated in Q2 and Q3. We are seeing helpful construction buyout savings in certain regions, which will allow us to preserve our targeted spread of 100 to 150 basis points between development yields and prevailing cap rates. In our SIP program, we continue to be conservative but do expect to grow that business line modestly through the year. The $200 million in commitments in the program today were all originated in the last two years, are geographically dispersed across our markets, concentrated in submarkets with less new supply pressure and have initial maturity dates that are still over two years out. So we do not have any legacy overhang burdening our loan book. It's also interesting to see some larger portfolio transactions starting to gain traction just in the past few weeks. This illustrates the continued attractiveness of our sector to private capital and perhaps marks a shift in sentiment that might bring increased deal flow as the year progresses. We continue to preserve dry powder on our balance sheet so we can take advantage of future opportunities that may emerge, if they align with our strategic priorities and unique capabilities.

Thanks, Matt. Our results to date have exceeded our expectations, and we're excited about the momentum heading into the peak leasing season. Demand is stronger than originally expected, and our suburban coastal portfolio faces significantly less supply than elsewhere in the country. We are confident that we will find opportunities to put our balance sheet and strategic capabilities to work to generate shareholder value. I'll end our prepared remarks there and turn it to the operator to open the line for questions.

And our first question comes from Eric Wolfe with Citi.

It's Nick here with Eric. Maybe just on the capital allocation and then transition into the Sunbelt. You made a comment in the prepared remarks about seeing opportunities below replacement costs. I'm curious if you can quantify that. Obviously, it's probably a range, but how far below replacement costs you're seeing on average and the size of the opportunity you're seeing in terms of product on the market in those expansion markets.

Sure. Nick, it’s Matt. The discount to replacement cost is obviously going to vary to some extent based on the age of the asset. In theory, assets that are 10 to 20 years old should be trading below replacement cost because there is some depreciation. We are seeing assets that are 10 years old might be trading 15% to 20% below current replacement cost. We haven't seen many brand-new assets coming out of lease-up hitting the market at compelling prices. I think people are getting extensions on their construction loans, and there’s a pretty active bridge lending space. We would look at those as well. For younger assets, I would expect the discount to be a little less, but we haven't seen much of that yet. The volume has been light and that's one reason supporting cap rates being lower than I would have thought. But there is a little bit of a scarcity premium there. We're taking advantage of that as sellers, which is one reason we brought some assets to market early because we anticipated that might happen. But as buyers, that's a little frustrating.

Would you expect some of that product to start to come to market? Or do you think owners will be more in a wait-and-hold mode? I'm trying to understand the current supply and the rate uncertainty might affect your acquisition strategy and urgency over the next year or two, particularly if the supply picture has started to improve.

I mean, who knows? I would say there is more volume coming. If you talk to the brokers, they'll say they're pretty busy with BOVs. This is the seasonal time of year when you start to see an uptick in transaction volume. Q1 volumes were down significantly from Q1 '23, which was down a lot from Q1 '22. And transaction volumes are now below where they were in '17, '18, '19. I think you will start to see some pickup in what might be available. And certainly, from our point of view, we're staying disciplined about it. We're hopeful that we might move into an environment where we can start to accelerate our asset trading activity a bit. We haven't done much in the last four or five quarters.

Nick, I'll add a couple of comments; it's well put by Matt. I generally see our window of opportunity being open for a decent period of time for two primary reasons: one, the supply dynamics that exist in the Sunbelt, per my prepared remarks, which we expect to hold for a while. Secondly, we're in the front part of the wave of maturities of deals done two, three, or four years ago. I agree with Matt that while we’re not seeing a ton today and not a lot of dislocation, it's still early. We're prepared to take advantage of it for the right types of opportunities.

And our next question comes from Jamie Feldman with Wells Fargo.

Great. I want to go back to a comment you made about rents and occupancy in the Sunbelt. You indicated it could last, at least, through '25 and possibly into '26. I want to ensure that I heard that correctly. Can you elaborate on what gives you confidence in this assertion?

Yes, Jamie, I'll start with a couple of comments. One is to state the known dynamics that exist: Supply in the Sunbelt will peak later this year but remain elevated into 2025. We know which projects are under construction, when they will complete, and the time associated with lease-up, which could delay impacts into early 2026. While the economic scenario has improved, we still expect pressure to continue in certain submarkets with high supply.

Are there specific markets that particularly stand out as having prolonged difficulties, aside from Austin?

Yes. Austin would definitely be at the top of that list due to the percentage of stock coming online. More urban-oriented submarkets in the Sunbelt generally exhibit higher supply levels. That's one of the reasons we've been purposeful in growing our expansion market portfolio beyond just those higher-density products. We're competing less directly with new supply.

So your Sunbelt expansion would still primarily be suburban, correct?

Yes, that's been a very deliberate choice of ours. We view this as complementing our acquisitions with what we will be building. We've been acquiring slightly older products—lower price point, lower density—while our development generally tends towards suburban mid-rises at slightly higher price points once they hit the market. We think about this at both the portfolio level and from a market perspective.

And our next question comes from Austin Wurschmidt with KeyBanc Capital Markets.

Matt, just to circle back on dispositions—particular factors that affected valuations you achieved? Were they reflective of the market overall, or were there more idiosyncratic aspects at play?

The first thing to note is none of the assets have closed yet, but it's a good mix. Three of the four are AVAs, slightly more urban than what we’ve sold in the past—one in Jersey, one in Seattle, one in Boston, and one in Southern California. The market tends to bifurcate for smaller deals, which attract private and syndicator buyers, while larger assets often attract institutional bidders. The larger deals tend to use less leverage, demonstrating lower cap rates if you find a strong institutional bid.

I wanted to ask about momentum in the Bay Area. What will it take for that to translate into outperformance amidst volatility?

It's a good question on many minds. Supply shouldn’t be an issue for an extended period. There are one or two assets in San Francisco finishing up lease-ups but, given the nature of the product and economic timelines, that won't be a concern soon. The key factor is on the demand side, requiring business leaders to be confident in bringing people back to their offices. Underlying issues, such as consumer comfort, play their role too. We see positive momentum in certain markets, including San Jose, but it's mixed overall.

Is that sequential improvement driven by West Coast markets specifically, or is it more broad?

The trends are primarily driven by East Coast markets. East Coast markets improved by 2% to 3% year-on-year, while West Coast markets grew close to 1%. Southern California markets are stronger, while Seattle has shown positive recovery. However, urban areas in Seattle remain soft due to significant new supply pressures. We're surprised by the recovery in Seattle, but in contrast, the Bay Area is lagging.

Our next question comes from Steve Sakwa with Evercore ISI.

On Slide 13, economic occupancy for 2024 shows no improvement. Given your recent 30 basis point pickup, why aren't you assuming improved occupancy? Is that due to your pricing strategy?

It's really two factors. First, the faster improvement in occupancy translates to rate acceleration, which puts some pressure on occupancy. The dollar value of a vacant unit is higher with higher rates, resulting in lower revenue contribution from vacancies. Those are the two primary reasons, relating to overall revenue estimates and the nature of occupancy to rate changes throughout the year.

Regarding renewals, are your notices going out at significantly better than 4%, indicating potential upside to this number?

Renewal offers for May and June are around the high 5% range. Expecting them to settle in the low to mid-4s is reasonable based on historical norms.

Yes, Steve. We're seeing some good momentum as we target new projects. Today, it’s not one number but varies based on market conditions. We're broadly looking for a target yield of 100-150 basis points spread over cap rates, translating to mid-to-high 6s generally. Locations with stronger expected growth lead to lower target yields and vice versa.

Our next question comes from Adam Kramer with Morgan Stanley.

Can you clarify your expectations for West Coast markets? They lagged a bit but might be expected to have outsized growth? What explains that delta?

The rent growth expectation is largely driven by improved bad debt and general market performance. In Q1, about 40% of revenue growth in Southern California stemmed from better bad debt management. This could lead to outperformance as we move forward.

What's your updated expectations for new and renewal growth reflecting your guidance? Where do the expectations stand now?

As I stated in my prepared remarks, we expect like-term effective rent change in the mid-2% range, which is about a 50 basis point increase from our original outlook. The second quarter should trend in the low 3% range before decelerating in the back half of the year. We're looking at renewal growth of low to mid-4% while new move-ins are projected to be in the low 2% range for Q2.

Our next question comes from John Kim with BMO Capital Markets.

What contributed to the capital markets outperformance? Last quarter, you gave a breakdown on that? What aspects are driving improvements?

The $0.02 capital markets favorability was primarily driven by favorable interest expense and interest income as well as slightly higher budgeted capital interest expenses. Most of the favorability was realized in those categories.

What are your cap rate expectations on sales or investments?

In Q1 we did not have any transactions that closed, so cap rates did not significantly impact. We foresee adjustments throughout the year, with expectations for annual capital markets activity remaining relatively stable.

Our next question comes from Joshua Dennerlein with Bank of America.

Regarding the widening gap between owning and renting—have you observed any historical periods that mirror this? How did it influence rent growth?

Today's rent versus ownership economics are unique. We're seeing unprecedented levels, with many of our markets being nearly double the cost to own compared to renting. While we don't anticipate this gap remaining at peak levels, it provides substantial support for our rental demand in the near term.

Is any future rent growth tied to the narrowing of this gap, or could this gap create potential upside?

The current year outlook reflects expectations of relative stability. Obviously, as interest rates and prices shift, that will be monitored continuously.

Our next question comes from Anne Chan with Green Street.

Have you seen heightened property tax assessments of apartments to address budget gaps resulting from subdued commercial real estate values?

It’s early in the assessment cycle, with most assessments weighing towards midyear. An uptick has been noted in Washington State and Virginia, but there's still a lag in property tax assessed values. Expect some pressure in the Sunbelt based on prior rapid value increases.

What level of CapEx per unit should we expect over the next few years for both NOI enhancement and asset preservation?

Our asset preservation CapEx has been around $1,600 to $1,700 per unit over the past two years, about 6% to 7% of NOI. We're looking to enhance our investment volumes considerably, targeting about $150 million this year, focusing on solar production and accessory dwelling units in California.

Our next question comes from Brad Heffern with RBC Capital Markets.

Your blended rate assumptions of low 3% for the second quarter seem conservative given the growth you've seen already. Are you projecting more muted seasonality than normal?

No, not really. The expected growth for Q2 is reasonable given the projections of asking rent growth. We will continue to monitor consistent changes as the season progresses.

Can you share any insights on concessions behavior in the other regions, particularly the expansion areas?

In the expansion regions, we have relatively small portfolios within the same-store basket. In Q1 Dallas experienced a year-over-year increase in concession volume, previously about a third of leases; now around half. In Denver, concessions vary significantly between urban and suburban areas. In Florida, pricing tends to focus on absolute rent rather than concessions.

Our next question comes from Haendel St. Juste with Mizuho Securities.

As supply slows heading into '26, when rents recover, how quickly can development resume in the Sunbelt? Is that a concern for your expansion plans?

There's less regulatory barriers in the South, allowing supply to respond quickly. While demand remains high, we pay close attention to specific submarkets that face more significant supply barriers, aligning our portfolio strategy appropriately.

In the near term, we find opportunities to buy below replacement costs and take advantage of our operational capabilities to drive shareholder value through well-timed acquisitions and asset management.

What are you observing in land costs currently?

Land prices vary significantly by region. Certain submarkets have seen prices fall considerably, making current opportunities attractive. Expansion regions have seen land prices stabilize somewhat, reflecting broader market behavior.

Our next question comes from Alex Goldfarb with Piper Sandler.

With the recent rent law updates in New York, do you see any opportunities for your development capital program?

Our developer funding program is focused on expanding growth in our target regions. We're not planning to grow our cap allocation in New York.

Your economic health seems solid across all markets. Are there factors suggesting weaknesses later this year?

Overall, our portfolio remains healthy. However, there are exceptions in urban submarkets, like D.C., that are facing challenges from both demand and supply sides. While the general outlook seems positive, certain areas still experience volatility.

I emphasize the improved job picture, but we do see crosswinds affecting the consumer. Factors like car loan renewals and student loan repayments could pose challenges even as our outlook improves.

And our next question comes from Anthony Dowling with Barclays.

Regarding the bad debt improvement observed in the quarter, what were the drivers?

The improvement stemmed from a combination of tighter processes and residents becoming current in their payments. Notably, the broader New York metro area showed improvement in bad debt metrics, reflecting our ongoing efforts.

How does the new law in New York impact your perspective?

Our portfolio allocation in New York remains at about 20%. We've aimed to gradually rotate capital out to favor growth in our expansion regions, particularly New Jersey, which exhibits better development yields.

Our next question comes from Linda Tsai with Jefferies.

What can you tell us about demographic shifts among your residents?

I wouldn't state anything significantly changed, though there has been a slight rebound in near-normal levels after visible fluctuations during the pandemic.

Is the recent job growth affecting demand among lower-income residents?

Our lower price point assets are performing very well, potentially better than higher price point assets, reflecting market conditions and demand stability overall.

Our next question comes from Jamie Feldman with Wells Fargo.

Can you elaborate on debt maturities in '24 and '25? What’s in your guidance regarding refinancing options?

As for our capital plan this year, it hasn't changed notably. We have $1.4 billion in uses, primarily comprising investment spend and a debt maturity later this year. Our sources include free cash flow and drawdown of unrestricted cash, along with anticipated external capital sourced through two debt offerings.

How will you address hedging costs for the upcoming years?

Hedging is an ongoing assessment process based on our evolving capital plan. We assign hedges considering anticipated activity and the opportunities in the market at any given time.

Our next question comes from Michael Lewis with Truist Securities.

About your references to Sunbelt versus established regions; what do you foresee for performance heading into '25 and '26?

Starts in the Sunbelt are anticipated to peak this year and remain elevated through the middle of the next year. Following that, we expect it to revert to more typical levels, with greater performance opportunities in our established regions likely given lower supply pressure.

Are you concerned about the 2.5% supply growth in the Sunbelt relative to the 1.3% in established regions?

I think the fundamentals will start to look similar over time. Given the delivery cycle timing and how long it takes to stabilize assets post-lease-up, we are confident in our performance relative to the Sunbelt scenarios.

And there are no further questions at this time. I'll hand the floor back to Ben Schall for closing remarks.

Thank you all for joining us today. We appreciate your engagement and support, and we'll talk with you soon.

Thank you. That concludes our call for today. All parties may disconnect.