Question-and-Answer Session
Operator
(Operator instructions) Your first question comes from Michael Bilerman. Your line is open.
Craig Melcher – Citigroup
Hi, it's Craig Melcher here with Michael.
Kenneth Myszka
Hi, Craig.
Craig Melcher – Citigroup
Dave, what's the assumption on the interest rate you are assuming on that unsecured note offering to get you to that $0.06 to $0.08 dilution figure?
Dave Rogers
Well, right now, we are paying at floating LIBOR plus 90, which is about 2.9 or so. We are looking perhaps to go as high as 6%, if we do it with the ten-year notes. Five-year notes would put us in the range of probably a $0.03 to $0.04 dilution, because we'd be locking – we would plan to lock in at LIBOR of about 3 with a spread of probably about 160 to 180 over that.
Craig Melcher – Citigroup
Okay. And does that assume you also repay that $100 million maturing in late '09, that $0.06 to $0.08, or is that incremental to that $0.06 to $0.08?
Dave Rogers
That actually won't have any effect, because no matter what we do with the '09 note, we are hedged. So, whatever instrument we use to take that note out would keep the same rate. So it would only be on the $132 million that we have outstanding.
Craig Melcher – Citigroup
Okay. But you have spoken to the lenders and you think you can get a spread of 160 to 180 over?
Dave Rogers
We think.
Craig Melcher – Citigroup
Okay. On the occupancy data for the quarter, it looks like at the end of the quarter the occupancy dipped a little bit. If you look at the quarterly average, occupancy was down 170 basis points. But at the end of the quarter year-over-year it was down 240. Is there anything specific going on there?
Dave Rogers
This has always been our nadir, the middle of March to the middle of April has been – if you look back historically, our nadir. So, we have slid a little bit. We are sliding a little more than we like, perhaps a little bit more than we expected, but nonetheless, this is – you draw the curve year after year after year and you see us dipping to the low point right at March 31. So, we are not thrilled, but it's not unexpected.
Craig Melcher – Citigroup
Is it impacting your rental rate decisions so far in the second quarter?
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