Question-and-Answer Session
Operator
(Operator Instructions). Our first question comes from the line of Kristin O’Connor from Morgan Stanley. Please proceed with your question.
Kristin O’Connor – Morgan Stanley
Hi. Thanks. Good morning. Can you talk about what economic assumptions are incorporated in your 2008 guidance? For instance, does it assume a recession and what the job growth outlook is for the various markets?
David P. Gardner
When we’re putting our guidance together we don’t try to be prognosticators of the future job growth and such. I think in my formal presentation I tried to suggest that it’s what we’ve seen today. It’s demand that we’re seeing today. It’s the lower available the rent the higher occupancy the higher traffic. Things of that sort are making it feel that we’re starting out at a reasonable spot. So we’re not feeling any recessionary trends today. We do believe that if there is more recession in the second half of the year that, if there is some pressure on revenue growth that it will hopefully be offset by the now fully functioning LRO that will be in place at that time. I would suggest I really haven’t built in positive some LRO in the idea that we’re anticipating there could be some pressure from a recession. I can’t sit here and tell you what kind of job growth I’m assuming, but I do believe that we will have some pressure in the second half of the year.
Edward J. Pettinella
Yeah, the unemployment growth is generally trended and our market is about a percent under the national average and it seems to be continuing, surprisingly. And another, what I would consider an early warning model, the companies in our neighbourhoods that are laying off or reporting in the paper, there’s only been a couple that we’ve seen that are somewhere between 250 and 1,000 employees over the past quarter. So it’s odd. It’s not significant so far. And as Dave said, in our guidance we’re going from 94.6%, we not only expect to hold that level, but we may see it move up about three-tenths between now and the end of the year 2008. So we’re not seeing recessionary effects as of yet and as a result we have not laid in how the effect of recession in this guidance.
Kristin O’Connor – Morgan Stanley
Okay. And can you talk a little bit about the large increase in the percentage of people who left due to eviction or skipping. Is that a seasonal increase or is that a reason for concern?
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