Question-and-Answer Session
Operator
Thank you. (Operator instructions) And we’ll take our first question from Steve Sakwa with Merrill Lynch.
Steve Sakwa – Merrill Lynch
Good morning. Two questions. Jeff, first of all, I guess in light of the environment here, why wouldn’t you just basically shut the entire development pipeline down now given that you’ve got $8 billion of properties and some form of stabilization period and/or lease up, which by most accounts would be at least a two-year potential delivery of supply into funds. I mean, I guess, why wouldn’t you take a more dramatic reduction in development at this point?
Jeff Schwartz
Steve, I’ll start that and I’ll turn that over to Ted to elaborate and we’ve both been involved in this on a global basis, Ted particularly in North America and more involved – and myself outside of the US. But effectively that’s what we’ve done. Beginning in September, we have done nothing but build to suit starts, and those are serving customer relationships that we’ve had for an extended period of time.
We’ve also both put in – increased our expected investment yield or decreased our expected value upon completion to be conservative and those required that our teams, not only have things 100% pre-lease, but also increased our required margins substantially above where there were previously – to ask what they were previously – quite frankly at a minimum on those.
So effectively, when you see our starts in Q4, and our expectation is in the first half of next year, there’ll be very few development starts again only pre-leased buildings as we assess the market conditions, but your point is well taken and something that we’ve already put into effect.
Steve Sakwa – Merrill Lynch
Okay. And then secondly, can you maybe – I mean Bill did a very good job outlining kind of the capacity of the funds given that there seems to be very little debt available. You have an ability to finish products and then complete it and sell it into funds using 100% equity or do these investors effectively require the use of leverage and therefore if leverage isn’t available, assets cannot be contributed?
Bill Sullivan
Steve, this is Bill. According to our funds, we have the ability in our discretion to use 100% equity to fund any of the contributions, and so effectively take that one off the table. But there is debt available and I hope then sort of talking through our fund debt activity. We have lot of things that we’ve closed in the last five to six weeks. We’ve got a number of closings coming up in the coming weeks and we’ve got term sheets and commitments and other activities on other financings. And so I think the death of the refinancing market is slightly overstated at this point at low leverage. We are finding opportunities to finance the majority of these assets. Having said that, we can use all equity if we so choose and in certain instances, it may make sense to use all our equity and wait for the markets to settle down and then lever up.
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