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DATE
Thursday, July 24, 2025 at 9 p.m. ET
CALL PARTICIPANTS
Chief Executive Officer — Dan Hedigan
Chief Operating Officer and Chief Legal Officer — Mike Alvarado
Chief Financial Officer — Kim Tobler
Senior Vice President of Finance and Reporting — Leo Key
Executive Chairman — Stuart Miller
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TAKEAWAYS
Net Income-- Net income (GAAP) was $8.6 million, described as "largely in line with our guidance for the quarter," with primary contribution from Great Park land sales.
Great Park Venture Net Income-- $48.4 million reported.Five Point Holdings(FPH 3.77%)' share (adjusted for basis differences) was $16.7 million.
Liquidity-- $581.6 million total liquidity reported, comprising $456.6 million in cash and cash equivalents, and $125 million of undrawn revolving credit facility.
Residential Land Sale-- Closed 82 homesites at Great Park (5.7 acres) for $63.6 million, supporting reported profitability.
Equity in Earnings from Unconsolidated Entities-- $17.1 million of equity in earnings from unconsolidated entities, $16.7 million attributable to Great Park Venture results.
Great Park Venture Land Sale Gross Margin-- 75% gross margin on $63.6 million in land sale revenue.
Price and Profit Participation Revenue (Great Park Venture)-- $8.6 million received from alternative land sale structures.
SG&A Expense-- $15.6 million for the second quarter.
Debt Metrics-- Debt to total capitalization was 19.1% at the end of the quarter. Net debt stood at $68.4 million.
Q2 Cash Reduction-- $71.7 million decline in cash, mainly tied to $32 million in Valencia development costs, and $27.5 million in senior note interest.
Valencia Home Sales-- With six sales programs active, and one expected to conclude by year-end.
Great Park Home Sales-- Builder sales of 112 homes compared to 233 in the previous quarter, with 13 active sales programs, and another ten programs planned to launch later this year.
2025 Net Income Guidance-- Management now expects year-end net income (GAAP) to be consistent with the prior year's $177.6 million, with possible timing shifts in land sale closings into 2026 rather than 2025.
Hearthstone Acquisition Structure-- Deal to acquire 75% of Hearthstone, projected to close in Q3, with Five Point Holdings expecting to consolidate operating results.
Hearthstone AUM and Growth Goals-- Hearthstone manages approximately $2.6 billion in assets under management. Management aims to grow assets under management to $7-$8 billion over the next two to three years through a $37.5 million co-investment, plus leverage.
Hearthstone Revenue Model-- Asset management fees paid monthly, plus performance-based fees, typically with Hearthstone contributing just 1% of joint venture equity.
Homebuilder Market Conditions-- Management notes a "slowdown in new home sales since early April" in both the Great Park and Valencia communities, attributed to "higher interest rates and lower consumer confidence."
Corporate Structure and Share Repurchases-- Management confirmed "under our senior note indenture, we are not able to" repurchase shares currently, but may address this with a future senior note refinance.
San Francisco Community Development-- Engineering for the next phase of infrastructure underway, and construction expected to start early next year, with ongoing efforts to attract a strategic partner or capital.
SUMMARY
Management described continued quarterly profitability enabled by high-margin land sales, despite slowing new home sales and broad residential market softening. Guidance was updated to align year-end net income with the prior year's $177.6 million, citing the potential deferral of certain land sales into the next fiscal year. The acquisition of the Hearthstone platform is expected to consolidate an additional asset management business in the company's financial statements, extend national reach, and accelerate growth in assets under management, although a material financial contribution is now deferred to 2026. Liquidity remains robust, leaving management flexibility to time land sales and optimize margins, while ongoing regulatory progress and new program launches support future growth potential.
Kim Tobler stated, "We currently believe that we will end the year with net income consistent with last year's $177.6 million."
Mike Alvarado highlighted that Hearthstone serves as operator in joint ventures and "earns asset management fees that are payable monthly, and additional performance-based fees when certain financial hurdles are met, while typically only having to contribute 1% of the venture's equity needs."
Dan Hedigan addressed land pricing, stating the company intends to "let this market kind of settle down, hopefully," and is not presently planning price reductions.
Kim Tobler confirmed, regarding buybacks, "under our senior note indenture, we are not able to do that," but added this will be revisited during future refinancing considerations.
INDUSTRY GLOSSARY
Land Banking: A financial arrangement where a third party acquires land and holds it for a homebuilder to avoid on-balance-sheet ownership, typically via joint venture or option agreements.
Assets Under Management (AUM): The total market value of assets managed by a company on behalf of outside clients, particularly relevant for asset management and joint venture platforms.
Full Conference Call Transcript
Dan Hedigan: Thank you, Paul. Good afternoon, and thank you for joining our call. I have with me today Mike Alvarado, our Chief Operating Officer and Chief Legal Officer, Kim Tobler, our Chief Financial Officer, and Leo Key, Senior Vice President of Finance and Reporting. Stuart Miller, our Executive Chairman, is joining us remotely. On today's call, I will update you on our Q2 results, which reflect the company's consistent cadence of quarterly profitability. I will provide a snapshot of the status of the company's current operations, including our strategic priorities and expectations for the remainder of 2025. I will also provide a brief update on our announced acquisition of 75% of the Hearthstone land banking and residential advisory platform.
Additionally, I have asked Mike to discuss the Hearthstone acquisition and Five Point Holdings, LLC's growth strategy in more detail. Finally, Kim will give an overview of the company's financial performance and condition, with updated guidance for the remainder of 2025. We will then open the line for questions. I would like to ask that you please limit yourself to one question and one follow-up.
Turning to the second quarter, I am pleased to report another profitable quarter for Five Point Holdings, LLC. We had anticipated that Q2 would be relatively quiet in comparison to the beginning and end of the year. However, we remained profitable and generated net income of $8.6 million, which is largely in line with our guidance for the quarter. The primary driver of this profitability was Great Park land sales. The Great Park Venture closed on a residential land sale consisting of 82 homesites on approximately 5.7 acres for an aggregate purchase price of $63.6 million.
This enabled the Great Park Venture to generate net income of $48.4 million during the quarter, our share of which, adjusted for basis differences, was $16.7 million. From a balance sheet perspective, we finished the quarter with total liquidity of $581.6 million, comprised of cash and cash equivalents totaling $456.6 million and borrowing availability of $125 million under our unsecured revolving credit facility. Against that backdrop, residential markets in general have weakened as a result of higher interest rates and lower consumer confidence, as has been widely reported by many of our builder customers and as they have reported in their earnings calls.
Nevertheless, our results reflect our continued focus on generating revenue, controlling our expenses, and managing our capital spend.
As we look at the remainder of the year, we expect a strong finish to 2025 with anticipated residential land sale closings at the Great Park in Q3 and Q4, notwithstanding current uncertainty in the homebuilding industry. While these challenges are leading to slower new home sales by many of the public builders, to our benefit, existing communities are located in California markets that are chronically undersupplied. Even with the current market conditions, there is continued interest in our communities. On my last call, I indicated that we believe we were on track to meet our prior guidance with estimated earnings for 2025 that would exceed 2024's net income of $177.6 million.
Even in light of the current market environment, we believe that we will end the year with net income consistent with last year's earnings. Obviously, the market is very dynamic at this moment, and we will continue to monitor evolving market conditions as the year progresses. Kim will provide more details on our guidance for the remainder of 2025 during his remarks.
Now let me turn briefly to our current operating strategy. As a reminder, the key elements of this strategy are: first, optimizing home site value within our existing three premier master plan communities by matching home site sales to current home builder demand. As I mentioned, homebuilder demand is softening currently. Seeing these current conditions, we are positioned to remain patient and continue to optimize the value in our uniquely positioned land, which should allow us to maintain the margins embedded in that value. Second, we are carefully managing our fixed costs and overhead even while we pursue growth opportunities. Although there are additional costs associated with our planned growth, we are maintaining our lean operating structure. We anticipate that our acquisition of Hearthstone will be accretive to earnings notwithstanding additional labor costs associated with the acquisition.
Third, we are continuing to match development expenditures with revenue generation to ensure that we are not deploying cash too far out in front of the needs of development. Fourth, we anticipate closing Hearthstone in the third quarter and will be working to integrate its operations into our platform. We will continue to seek growth opportunities on an opportunistic basis through new acquisitions, joint ventures, and strategic relationships. Our focus will remain on these strategic elements of our operating platform as we produce recurring earnings along with sustainable long-term growth. With that said, the members of our executive team have all been in this business long enough to know we will need to navigate through uncertainty from time to time.
Let me now provide you with some updates on our communities. Of note, across both of our actively selling new home communities, Great Park and Valencia, we have seen a slowdown in new home sales since early April. At this time, given the housing shortage, we believe this is a temporary condition in the new home market and will self-correct over the next quarters. As I mentioned earlier, the market is very dynamic at this moment, and we will continue to monitor and adjust as warranted by conditions at both the national and local levels. So let me turn first to our Great Park neighborhoods community.
During the second quarter, Builders Nest community sold 112 homes versus 233 homes in Q1 of 2025. We currently have 13 actively selling programs in the Great Park, roughly half of which we expect to be sold off by the end of 2025. Ten additional programs are anticipated to start sales later this year. I also previously reported the completion of bidding and contract for a group of nine new residential programs at the Great Park totaling 572 home sites. These are being sold to six builders. We still anticipate that these land sales will close either late third quarter or early fourth quarter of this year. We will have more to report on these sales next quarter.
I have also previously reported that the city of Irvine completed its state-mandated regional housing needs assessment, general plan, and zoning updates for the Great Park planning area, which will provide the Great Park Venture with the opportunity to convert some or substantial portions of its remaining commercial land holdings to residential uses. We continue to work with the city to expand our residential opportunities on our remaining land consistent with the Reno program adopted by the city.
Now let me discuss Valencia, our other active community. As a reminder, Valencia is in the early stages of its development and still has many future phases of land delivery ahead of it, which will enable us to provide much-needed housing in the Los Angeles market. During the second quarter, our guest builders sold 49 new homes compared to 69 in quarter one. We currently have six actively selling programs in Valencia, with one of those expected to sell before year-end. Additionally, we anticipate another four programs will open during the last half of 2025, providing a greater diversity of home offerings for prospective home buyers. We continue to work with builders on the potential sale of two new communities.
As I previously discussed, we also continue to work with Los Angeles County and other agencies on our regulatory approvals for future development areas in Valencia that will allow us to deliver thousands of additional home sites in the county's severely undersupplied market. In total, these developments are expected to consist of approximately 8,900 market rate home sites and 183 net acres of commercial land, approximately 139 of which is expected to cater towards industrial-focused uses.
Turning to San Francisco, we are currently working on our engineering for the next phase of infrastructure with the expectation of starting construction early next year. As we work on these plans, we continue to explore opportunities to bring in a strategic partner or other capital sources for this mixed-use Bayfront community. So let me now move to the Hearthstone acquisition. As we recently announced, Five Point Holdings, LLC entered into an agreement to acquire a controlling interest in a newly formed entity that will include substantially all the business and operations of Hearthstone, a provider of capital solutions to the US homebuilding industry. This move represents a meaningful step forward in our long-term growth strategy.
We believe that this acquisition provides Five Point Holdings, LLC with a number of benefits and opportunities. First, it provides us with a platform to offer broader capital solutions for the many homebuilders that are already Five Point Holdings, LLC customers as they continue to adopt landline strategies. We believe this will help fortify their already strong relationship with these customers and will add new ones. Second, this acquisition enhances Five Point Holdings, LLC's evolution into a capital allocator and manager of institutional capital through joint venture structures, which complements our deep land development expertise. Third, with a proven national platform, Hearthstone allows us to immediately expand our geographic reach, client relationships, and capabilities.
Fourth and most importantly, it introduces recurring revenue streams by also connecting us to a broader network of institutional capital providers and builder clients. We are on our way to obtaining all necessary third-party consent, and we anticipate that the acquisition will close during the third quarter.
Let me conclude by saying that while homebuilders are navigating the market uncertainty caused in part by reduced consumer confidence, our balance sheet and liquidity position allow us the flexibility to patiently optimize our land values while still working with our guest builders to ensure the prudent development of our master-planned communities. Fundamentally, land is still about location and scarcity. We have well-located land in extremely supply-constrained markets. Now let me turn it over to Mike to provide more information on the Hearthstone acquisition and discuss Five Point Holdings, LLC's continued focus on additional growth opportunities.
Mike Alvarado: Thanks, Dan. Let me briefly provide some additional information about our vision for the possibilities with the new Hearthstone venture, as well as our continued efforts to pursue additional growth opportunities. As Dan mentioned, this represents a targeted acquisition for Five Point Holdings, LLC and is the realization of our efforts to better serve the landline strategy that a number of publicly traded homebuilders have gravitated towards in recent years. It has been reported that over 70% of land pipelines for homebuilders are rather than purchased outright, and that the public homebuilders buy and develop over $35 billion in land per year. We believe our venture has the opportunity to capture a meaningful portion of that market.
For those of you who may not be familiar with Hearthstone, they are a market leader in providing these off-balance sheet capital solutions to US homebuilders, with current assets under management of approximately $2.6 billion. Hearthstone started its slot auction program back in 1996, and we believe they are the only lot auction investor operating today that has been through multiple business cycles, including the great financial crisis. Over time, the land banking space has become increasingly important as homebuilders have strategically sought to avoid holding land on their balance sheets and have come to rely upon land banking and capital partnerships to secure home sites.
Hearthstone's model is perfectly aligned with this shift, and their proven platform provides Five Point Holdings, LLC with immediate scale and credibility in this space. Hearthstone's disciplined underwriting and their focus on risk-managed capital deployment align with Five Point Holdings, LLC's commitment to delivering strong long-term returns for shareholders. Hearthstone's experienced team, combined with Five Point Holdings, LLC's public company infrastructure and development capabilities, will allow us to grow the new venture efficiently and responsibly.
For Five Point Holdings, LLC, this venture helps our transition into an asset-light structure where almost all of the capital for the lot option investments will be provided by third-party capital sources through a joint venture arrangement. Hearthstone serves as the operator in these joint ventures and earns asset management fees that are payable monthly, and additional performance-based fees when certain financial hurdles are met, while typically only having to contribute 1% of the venture's equity needs. Beyond the immediate financial benefits, we believe that Hearthstone's relationships with capital providers and builders across the country will complement Five Point Holdings, LLC's existing relationships and will unlock additional strategic growth opportunities for Five Point Holdings, LLC.
As part of that growth, we see a major opportunity in the midterm land market, a segment currently underserved by traditional capital providers. We have already had conversations with capital providers and builders who have expressed an interest in discussing joint ventures or acquisition opportunities for land that does not fit in a shorter-term land banking model. These are the types of assets that fit into the core of what we do as a land development company. In sum, this is not just an acquisition. It is a strategic move that reinforces our position in the evolving housing ecosystem and positions us for long-term sustainable growth.
Now let me turn it over to Kim to report on our financial results for the quarter.
Kim Tobler: Thank you, Mike. As Dan and Mike have shared, we are very excited about the progress Five Point Holdings, LLC is making in executing on our strategic priorities, including the Hearthstone transaction and the potential it provides to drive revenue growth for the company. I am now going to review our second quarter financial results and some information about our expectations for the Hearthstone Venture. Then I will conclude by updating the guidance of what we are expecting in 2025. In the second quarter, we recognized $8.6 million of net income, bringing us to $69.2 million for the six months ended June 30th. The quarter's net income is made up of the following components.
We recognized $17.1 million of equity in earnings from our unconsolidated entities, $16.7 million of which came from the Great Park Venture. The equity in earnings from the Great Park Venture was attributable to net income of $48.4 million, resulting from land sales revenue of $63.6 million and a 75% gross margin. The venture also had $8.6 million of price participation and profit participation revenue in the aggregate, as the venture enjoys revenue streams that come from these different types of land sales structures. Five Point Holdings, LLC added $7 million of management services revenue, $30.6 million of which is associated with incentive compensation from the Great Park Venture.
Our second quarter SG&A was $15.6 million, and finally, we recognized $1.3 million of tax expense.
Let me provide a little detail about our liquidity and cash. As Dan mentioned, we ended the quarter with $456.6 million of cash, as well as $125 million of availability through a revolving credit facility, resulting in total liquidity of $581.6 million. At the end of the quarter, our debt to total capitalization was 19.1%, and our net debt was $68.4 million. During the quarter, our cash went down by $71.7 million. This was largely attributable to $32 million of development costs at Valencia and interest on our senior notes of $27.5 million.
While we had a sale at the Great Park Venture, the venture did not make a distribution this quarter and had a cash balance of $168.2 million at quarter-end.
While Dan and Mike have shared a great deal about the Hearthstone transaction and the transformative nature of this acquisition, I thought I would give some limited information about the expected financial implications to Five Point Holdings, LLC. First, I want to emphasize that we have not completed our accounting analysis for the transaction, so what I share is subject to the completion of that analysis after we close the transaction. Since Five Point Holdings, LLC will own 75% of common units in the Hearthstone Venture and will control the executive committee that manages the business and affairs of the venture, we will be expecting to consolidate the activities of the Hearthstone Venture in our financial statements.
These activities include asset management and co-investment with the managed capital that is raised. As Mike mentioned, the venture generally expects to invest 1% of the required capital alongside the capital that is raised to finance the lot option fund joint venture structures that it is managing. Please note that these fund structures are not expected to consolidate with Five Point Holdings, LLC. Some of those fund structures currently use limited amounts of borrowed capital to augment the equity capital. That indebtedness is not expected to be consolidated on Five Point Holdings, LLC's balance sheet. As I mentioned, this treatment is all subject to our final accounting analysis.
Now if you reviewed our 8-K announcing the transaction, you may have noted that in addition to the $56.3 million acquisition price, Five Point Holdings, LLC expects to contribute an additional $37.5 million over time in order to fund the co-investment as the assets under management grow, which as I mentioned is generally 1% of invested capital. Depending upon the amount of leverage that is utilized in the new funds, this would suggest that we can grow the assets under management from the current $2.6 billion to $7 or $8 billion.
We believe that this growth can occur over the next two to three years and that we can achieve that growth without materially increasing the personnel required to service those funds. The Hearthstone joint venture is expected to be profitable this year. However, we do not expect it to materially contribute to our results for 2025, but expect a larger contribution in 2026, and I will be giving more guidance in that regard at year-end.
I would like to now update our guidance for the balance of 2025. We currently believe that we will end the year with net income consistent with last year's net income of $177.6 million. This change largely reflects the possibility that certain land sales might close in 2026 rather than 2025. As we mentioned last quarter, we continue to monitor the debt markets and remain ready to consummate a refinance transaction for our senior notes, including a paydown of some amount of principal when we determine it is prudent to do so. With that, let me turn it back to the operator who will now open it up for questions.
Operator: Thank you. We will now conduct a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys.
Alan Ratner: Hey, guys. Good afternoon. Congrats on the Hearthstone deal. Exciting growth opportunity for the company. I know you will give more 2026 color in a few months, but I am just curious. In terms of the economics of it, should we just think broadly as that business kind of being a percentage of assets under management less some type of personnel expenses? Is that the right way to think about modeling that longer term?
Dan Hedigan: Yes. Yes, Alan. That is the way you should look at that.
Alan Ratner: Okay. Great. And then just in terms of the business itself, you know, there have been quite a few new entrants into the land banking space over the last year or two. And we have seen generally kind of terms and structures getting more competitive in space that, you know, I am thinking specifically with Millrose and smaller deposits and, you know, kind of smaller interest carry compared to what we have heard was kind of ongoing previously in the private arena.
Have you given any contemplation to kind of products or, you know, new terms or financing vehicles that you are going to be offering the public community to get that, you know, assets under management up to $7 or $8 billion over the next few years?
Dan Hedigan: Thanks, Alan, for that question. It is a very good question. You are right. There is a lot of movement in this space right now. But what I think we see out there is that demand is much greater than current supply. So, you know, we do not need to really make any changes from what we are currently or what Hearthstone is currently doing. Working with them, we are going to hopefully expand their capital base. And there should be a lot more, there is a lot of need in this space in the homebuilding world. So we do not think we have to change anything.
Hearthstone has got a great platform and business model, and we think we can stay consistent with that.
Alan Ratner: Great. I appreciate that, Dan. So pivoting to, I guess, the core business, if you will, just on the land side, you know, we have been hearing from a lot of public builders the last few days about their business. It seems like everybody is pulling back. Starts. They are pulling back land spend. You know, your projects are unique in that they are obviously very desirable in both good and bad markets. But a lot of management teams are, you know, talking about the possibility of achieving lower land prices from sellers and just, you know, getting some capitulation on that front.
I am curious, you know, when you think about the guidance for the land sale later this year. I know you kind of mentioned the reduction is more, I think, a timing thing, maybe some of those deals get pushed out to 2026. But are you contemplating the possibility of potentially lower pricing in either Great Park or Valencia, either on a per lot basis or per acre basis compared to what you have achieved more recently, given what we are hearing from the builders recently?
Dan Hedigan: You know, Alan, I have actually been reading the same things you have been reading, but, you know, California is so supply-constrained and unique they cannot really, you know, they cannot replace the land that is here. But, you know, we are not, you know, we will work with our builder partners to the extent that, you know, they reach out to us. But I think at this point, we do think that we have got the ability to, you know, to let this market kind of settle down, hopefully. And, you know, still move our land forward as we are planning.
But at this point, I think that, you know, the uncertainty in the market is just going to have to play out just a little bit longer. And so we are, at this point, thinking more about just trying to work with our existing builders and, you know, keep our land sales moving forward.
Alan Ratner: Got it. That is helpful, Dan. And then a final one for me on the land development cost side. You know, you think about Valencia and the development work out ahead of you there and then hopefully eventually San Francisco gets up and running. We have also heard a lot about the potential for driving land development costs lower, kind of given everything that is going on in the market. And I know your chairman, who is on the line, has talked a lot about, you know, potentially utilizing AI as a tool to also leverage that part of the business.
So I am curious if that longer term you are kind of optimistic that might filter through to Five Point Holdings, LLC's business specifically in the two projects that have a lot of development work out ahead of them.
Dan Hedigan: Well, you know, I think, Alan, the broad answer to that is that as technology progresses, we are hoping it really helps us really try to be able to manage our land development work better, you know, analyze it better. You know, ultimately, still, we are going to be in a very kind of physical moving dirt is not going to change. But hopefully, we can move it, you know, smarter and more efficiently. And I think there is some technology that people are working on that can help us there. But for this point, we have not changed any of our budgeting or thoughts around that as we think about our future development.
But we are hopeful that it can make us more efficient in moving the dirt.
Alan Ratner: Right. A lot, and good luck with everything.
Dan Hedigan: Yeah. Thank you, Alan.
Operator: Our next question is from David Lundgren, Private Investor.
David Lundgren: Yeah. Hi. Thank you for taking my question. I had a question about using your cash. I did not know if you consider using some of the cash to buy back shares.
Kim Tobler: David, thanks for asking. A number of people were interested in that question. Currently, under our senior note indenture, we are not able to do that. So that is part of what we are looking at as we look to perhaps refinance those notes.
David Lundgren: Okay. And then, I mean, I guess the elephant in the room that rarely gets discussed on these calls is that, you know, the stock price being well below book value. And I have been a shareholder for many years, and I am curious, like, if you are ever going to try to address that or look into reasons why the market is not valuing you where you should be. I think, you know, as an investor, I think one of the reasons you are not valued at the appropriate stock price is because of your corporate structure, which is very confusing. And this recent deal to buy Hearthstone is making everything more confusing because you are buying 75%.
So now you have, you are adding, like, another serpentine layer. So I do not think that this new transaction helps with the corporate structure. I think if you could somehow simplify the corporate structure, maybe that might help the share price. But as a long-term shareholder, I am just wondering if you are, is this a concern for you that the stock price does not reflect the true value, the fact that you are well below book value?
Kim Tobler: David, I appreciate that question. First of all, I want to answer directly about Hearthstone. Hearthstone, when it consolidates, it will not add to any complication. If you will, we will own 75%, but we will report 100%. But as it relates overall to the concern about the difference between the book value and the fair market value of the stock at this time, I, you know, I appreciate the difficult structure that exists, but there are advantages to it from the tax side and other elements that are very important to the company. And, additionally, I think at another time, we might go through kind of the elements that are associated with the stock going down in value.
But we see it rising and continuing to rise over the next several years.
David Lundgren: Okay. Well, thank you for answering my questions. I think you guys are executing really well. I just, I am just always wondering why the stock price does not reflect that. So but thank you for answering my questions.
Operator: Thank you. Our next question is from Ben Fader-Rattner with Nexus Capital.
Ben Fader-Rattner: Hi. I just wanted to clarify something that you said. You said that there would be some debt paydown when you eventually refi the bonds. I think previously, you talked about $100 to $200 million of debt paydown. Is that still the right number?
Kim Tobler: You know, Ben, this is Kim. Thank you. That will be determined at the time when we enter into the transaction. I do not know what it will be at that time, given that the market is changing daily, it is important for us to assess our needs and everything as that day comes.
Operator: Thank you. There are no further questions at this time. I would like to hand the floor back over to Dan Hedigan for any closing comments.
Dan Hedigan: Thank you, Paul. On behalf of our management team, we thank you for joining us on today's call. We look forward to speaking with you next quarter.
Operator: This concludes today's conference call. You may disconnect your lines at this time. Thank you for your participation.