Question-and-Answer Session
Operator
Your first question comes from Ambika Goel - Citi.
Ambika Goel - Citi
Can you comment on the level of transaction volume that’s embedded in 2008 guidance? Is it specific deals that you have already set up that you expect to occur? Given that the level of transaction activity in 2007 was quite high, I just wanted to see what got you comfortable with 2008 levels.
David J. Oakes
We expect, at this point, the transaction volume in 2008 to be lower than the record volume in 2007. We’ve budgeted some expected asset sales, continuing to recycle capital and work on the assets that Dan mentioned specifically that came out of the portfolio reviews that might be good candidates for sale and do not have acquisitions identified at this point. So our budget currently is to be a net seller of real estate for 2008.
Ambika Goel - Citi
Specifically focusing on the gains, do you have deals in place that make you comfortable with transactional profits to be in line with the previous year?
David J. Oakes
We are comfortable with our guidance that transactional gains would be consistent with or somewhat lower than the level of 2007 that support the range that Scott provided.
Scott A. Wolstein
Ambika, most of that is merchant building gains based on actual development completions that already exist, which will probably be conveyed into joint ventures with financial partners, as we’ve done in past years. So yes, we’ve identified actual properties, the yields on those properties are already in place. We pretty much know what the cap rates would be on any sale or contribution to a joint venture.
Operator
Your next question comes from Jay Habermann - Goldman Sachs.
Jay Habermann - Goldman Sachs
Good morning, everyone. On the ?08 guidance, calling for 5%, 6% growth year over year which again looks reasonable, but a bit of a deceleration. Can you just comment to what degree being a net seller next year, what sort of dilution you’re expecting there? To what degree will you be a net seller in 2008?
David J. Oakes
Right now, for the budget we are expecting to be a net seller of several hundred million dollars of real estate in 2008.
Jay Habermann - Goldman Sachs
Can you just characterize the pipeline of acquisitions that you’re actually looking at today?
David J. Oakes
I would say despite the slowdown a few months ago, there continues to be a healthy amount of products on the market and we continue to evaluate a very large number of acquisition opportunities across the spectrum of retail that are available today.
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