Question-and-Answer Session
Melissa Marsden
This question submitted by Sloan Bohlen of Goldman Sachs.
Sloan Bohlen - Goldman Sachs
You mentioned in your release that you were re-evaluating how you approach asset sales following the equity raise. Can you give us a sense of what that means? Both for the $700 million of wholly-owned and the $585 million of stabilized development that is either being marketed or is available for contribution? Is it a matter of cap rate or margin? And how do competing assets for sale in the market affect your timing?
Bill Sullivan
Let me, is this on? Let me take a quick shot. I walked through in one of my last slides the asset sales. Our expectations for the year have actually increased since the beginning of the year. I think we had originally guided at $1.3 billion to $1.5 billion gross. We have talked in the last 30 to 45 days about a slightly larger number. And, in fact, we are still targeting that number, which is $1.5 billion to $1.7 billion. However, we raised more in the equity offering than was originally planned.
And so, from our perspective, we have the opportunity to take a look at things as the year progresses and cut back on some of that, if, in fact, a deal or two, tries to get re-traded. Or valuations go against us from the contribution standpoint. However, we are still targeting at the midpoint about $1.6 billion. And I walked through the pieces of that a minute ago. And we are on track to make that happen.
Unidentified Analyst
I was wondering if you can talk about FFO trajectory. You put up this whole slide of core FFO of 82 to 98, and there was some talk about it increasing as you bring on the developments and other sort of initiatives. But I am wondering, if you can talk a little bit about the potential downside from that. You have $11 billion of debt at 4.8%. Obviously the refinancing of that debt overtime put aside the deleveraging impact, but just the refinancing of the debt is going to be coming at a much higher rate.
And then, there is going to be further deleveraging. So talk a little bit about what that impact is going to have to core FFO? But also in the development pipeline, as you lease that up I assume the cap interest is also going to come on to the balance sheet or on to the income statement. So that is going to depress you won't get the full benefit of it into earnings.
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