Dream Office Real Estate Investment Trust

Jane Gavan - CEO Kevin Hardy - SVP, Portfolio Management Andrew Reial - SVP, Portfolio Management Franca Smith - VP, Finance Michael Cooper - Chairman, Board of Trustees

Mark Rothschild - Canaccord Genuity Alex Avery - CIBC World Markets Mike Markidis - Desjardins Capital Markets Matt Kornack - National Bank Financial Mario Saric - Scotiabank

Thank you, operator. Good morning, everybody.

Welcome to Dream Office REIT's second quarter conference call. Joining me are Kevin Hardy andrew Reial and Paul Skeans, our Senior Vice Presidents and Portfolio Managers, will be available to answer your questions on each of those respective markets.

Also with me is Franca Smith, our VP of Finance, who gives some perspective on our financial results and Michael Cooper, Chairman of the Board of Trustees. Last year, we felt that 2015 was going to be a competitive environment for Canadian office REITs and we been emphasizing the importance of lease and proactive asset management as drivers of outperformance.

We believe our team has stepped up to the challenge and delivered stable operating and financial results in the first six months of 2015 in an economy that's been challenging. As we announced in January, we began the year with good leasing momentum having secured at that time, 45% of our 2015 expirees.

Through proactively reaching out to existing tenants or actively seeking out new prospective tenants, we've made significant leasing progress and we have now secured 84% of expirees for 2015 and 35% of the 2016 expireers. That's roughly 2.5 million square feet and over 400 deals so far for 2015 and 1.4 million square feet for 2016.

The Alberta office market remains challenging given the continued low oil price environment and softened economy. At the beginning of July, I was in Calgary for a number of tenant and broker events and the general mood was definitely subdued.

Overall, we're seeing tenants talking a wait-and-see approach, postponing leasing decisions, as they remained focused on the direction of their respective business. However, we continue to be very aggressive with all of our lease negotiations and we expect our occupancy in downtown Calgary to remain relatively stable for the balance of the year.

In contrast to Alberta, the downtown Toronto market remains strong. Our portfolio has in place and committed occupancy of 98% with 93% of the 2015 expirees and 43% of the 2016 expirees already addressed.

We continue to see solid tour activity in the Bay Street and King Street portfolios and Adelaide Place. In addition, we had a lot interest in 438 University and remain confident about our ability to fill this space.

As we've discussed before, loyalty will be leaving the building at the end of 2017 freeing up approximately 197,000 square feet. During the quarter, we responded to a 200,000 square foot RFP and are pursuing three other large prospects ranging in size between 30,000 square feet to 90,000 square feet.

As a result of the company tal investments we've made over the years and lead projects and specifically that was completed last year, elevator modernization and main lobby upgrades that are currently underway and scheduled to be completed this year, 438 University will be regarded as a premier affordable block of premises in downtown Toronto. This year, we embarked on a CAD75 million capital expenditures program to proactively invest in our buildings to improve tenant retention, attract tenants and reduce energy costs.

This is the largest annual investment we've made of which 70% to 80% will be recoverable from tenants. The CAD75 million includes CAD36 million of value add initiatives, CAD12 million for sustainability and the remainder for recoverable general maintenance.

At the end of second quarter, we spent CAD25 million towards these initiatives of which approximately 50% related to capital projects at Scotia Plaza which are largely recoverable from tenants. We expect the majority of the 90% of the budgeted amount to be committed by year end.

We continue to work on our capital recycling program by exposing of assets that we've identified as non-core to our portfolio and reinvesting in strategic initiative. During the quarter, we went firm on a CAD30 million disposition in British Columbia that had since closed.

We're now firm on disposition for an additional CAD130 million of assets in Ontario and Quebec subject to typical closing conditions. We expect these deals to close during the third quarter.

We'll continue to identify opportunities for strategic dispositions. We've made solid progress on our retail initiative that include upgrading the quality of our existing retailers and adding new retail space to our portfolio.

We successfully completed several strategic long-term renewals to create flagship tenant space within our buildings. This includes the Sleep Country at Yonge and Kings; One of their first locations that they will be rebuilding as a flagship location and Big Daddy's at King and Simcoe [ph] which will be rebranded to a new concept Lonestar.

We're currently seeing uplift on renewal wins on our retail business of approximately 13% across our portfolio. Additionally, we're being proactive in attracting new in-demand retail uses such as restaurants, fitness facilities and coffee shops.

We've also successfully completed some first-to-market new concept restaurants by repurposing some of our retail space and adding to Toronto's already vibrant food scene. For example, at 100 Yonge, we converted the former condo sales office to a restaurant to add to Scotia's amenity base with significant rent increases.

While continued weakness in oil prices have increased uncertainty and volatility in this economy, we continue to expect stability in our results reflecting resilient portfolio, a diversified tenant base and the strength of our leasing platform. The story of Dream Office this year has and continues to be leasing, leasing, leasing, aggressively filling vacancies and realizing opportunities to intensify their use.

We saw a robust level of leasing activity in the second quarter with 498,000 square feet of total leasing taking occupancy in the quarter. This includes 350,000 square feet of renewals representing a solid tenant retention ratio of 62%.

The spread between estimated market rents and in-place net rents have tightened over the past few quarters as we bring rents to market on lease renewals and with the downward pressure on market rents in Calgary. We presently estimate in-place rents to be about 6.4% below market across the portfolio.

In terms of total leasing volume complete during the second quarter, 902,000 square feet of leasing transactions were completed. These leases take occupancy in Q2 2015 or in future periods.

Of the 902,000 square feet, 522,000 were renewals and 380,000 square feet were new transactions. In our downtown Toronto portfolio, we completed 23 new deals in the second quart totaling 65,000 square feet.

This includes a seven-year lease with [indiscernible] consulting at 8 King for 7,000 square feet and an 11,000 square foot expansion of the Bank of Nova scotia out of 100 Young for years. Details were completed above market rent.

We completed renewals in downtown Toronto totaling 163,000 square feet including a 10-year renewal with DBRS for 41,000 square feet at Adelaide and a two-year renewals with CBRE for 37,000 square feet at 18 King Street East. In suburban GTA, we were very active and signed 25 new deals with tenants under 6,000 square feet for a total of 76,000 square feet and two short-term deals for six months for approximately 30,000 square feet.

During the quarter, we completed 19 renewals for 50,000 square feet. The largest renewal was 8,000 square feet with Scotiabank at our Aviva building.

Aviva continues to see a lot of activity from mid to large-sized users well in advance of its availability in late 2017. In Ottawa, we responded aggressively to a federal RFP for 51,000 square feet and were selected over newer class A builds as we were responsive to the government's workplace 2.0 requirements for the building and for being a cost-effective solution.

In downtown Calgary, we completed 10 new deals totaling 44,000 square feet and seven renewals totaling 37,000 square feet. We've now completed 77% of our 2015 lease expireers and one-third of our 2016 expirees.

Our average tenant size in Calgary is smaller generally not competing with the large floor price coming on the market either in terms of new builds or the large sublet space. Activity in our Calgary suburban portfolio continues at a modest pace with five new deals completed for 10,000 square feet and 3,000 square feet of renewals.

We leased up almost 90% of the 2015 expireers in this market. In Montreal, subsequent to quarter end, we completed a deal with National Bank for 135,000 square feet of which 68,000 square feet is in early renewal with the original maturity date in 2020 and the balance of 67,000 square feet being a new lease on a space at National Bank with subletting from Bell Canada.

We're pleased to have National Bank demonstrate such a commitment to this asset. We're focused on occupancy and in this part of the cycle where it's a more completive leasing market; our leasing cost had been higher than we've seen historically.

Our leasing cost this quarter were approximately 2246 per square foot leased which is higher than what we believe to be normalized levels, primarily due to two large tenants that took occupancy this quarter with longer than average lease terms and higher lease incentives. Based on our current information of over 200 leases that are taking occupancy in the second half of 2015, we're seeing leasing costs come in at around CAD15 per square foot.

Now I will turn the call over to Franca Smith, our VP of finance to provide a brief overview of our financial highlights.

Thank you, Jane. Overall our second-quarter results were in line with our expectations.

Fully diluted FFO per unit of CAD0.722 which excludes the impact of the cost of the consideration issued on the reorganization of the management agreement and related transaction costs compares to CAD0.708 in the prior quarter and CAD0.727 in the prior year comparative period. Our basic AFFO for the forward was CAD0.644 per unit up 3.5% over the prior quarter and up 0.9% year-over-year.

The quarter-over-quarter increase includes G&A savings from the reorganization of our management agreement net of the dilution impact of the units issued. The reorganization of the management agreement took effect on April 2.

And as of this date, Dream Office no longer pays asset management, acquisition and capital expenditures fees to Dream Asset Management Corp., a subsidiary of Dream Unlimited Corp. As consideration, we issued CAD4.85 million changeable limited partnership units of a subsidiary of the REIT to Dream Asset Management Corp.

representing total consideration of CAD127.3 million, based on our April 2, closing price of 2625 per unit. Dream Asset Management Corp.

will continue to provide strategic oversight of the REIT on a constant recovery basis. The ongoing G&A savings net of the dilution impact of the units issued are expected to be approximately CAD0.03 per unit annualized.

Comparable NOI for the quarter was flat compared to both the same quarter last year and the previous quarter. Compared to Q1 2015, higher rents on renewals and step-up in rental rates in Toronto downtown were offset by lower occupancy in Calgary downtown.

Looking to the remainder of 2015, we expect our in-place occupancy at the end of the third quarter to decrease from Q2 levels as previously reported tenant vacancies take effect the largest being winners which has vacated approximately 200,000 square feet. Occupancy levels at the end of the fourth quarter are expected to be flat to down slightly from those at the start offer.

Same property NOI is expected to be flat to slightly down as well and we expect to continue to benefit from G&A savings from the reorganization of the management agreement. On the capital side, we have maintained a stable and can conservative capital structure.

Our leverage was 47.9% compared to 47.6% in the previous quarter. Following the disposition of 8100 Grandville with the net proceeds used to repair credit facility; our leverage was reduced to 47.6%.

Our interest coverage ratio remains strong at 2.9 times and our net average debt to EBITDA FD ratio has improved to 7.6 years from 7.9 years. Our pool of unencumbered assets remained at approximately CAD820 million and going forward, we will continue to strengthen our balance sheet by refinancing our upcoming mortgage maturities where we expect to capitalize on low interest rates generating approximately CAD3 million in interest rates savings per year.

At the beginning of the year, we had approximately CAD300 million of debt maturing in 2015 at an average rate of 4.1%. To date, we have addressed or are in advanced stages of negotiating approximately 70% of this balance at attractive rate - five year government of Canada plus approximately 200 basis point spreads or as of today between 2.75% and 3.05% all in.

The secured financing market continues to present attractive refinancing opportunities to capitalize on low interest rate environment. We remain active on our NCIB program which we renewed in late June.

For the six months ended June 30, 2015, we have repurchased for cancellation just over 2 million REIT units at average price of 2660 per unit. Subsequent to quarter end, we have purchased a further 36,000 units for cancellation at average price of 2462 per unit.

We continue to actively repurchase units under our normal course issuer bids as we believe that the market discount of our units offers a compelling opportunity. Subsequent to quarter end, we completed the disposition of 8100 Grandville avenue in British Columbia for gross proceeds of approximately CAD30 million representing a cap rate of 6%.

A portion of the proceeds were used to pay down our credit facility which has been used on an interim basis to finance our NCI REITs. We're continuing to improve our portfolio by selectively pruning our noncore properties and continue to target roughly CAD300 million in total dispositions for the year with net proceeds to be reinvested back into our portfolio or buying back our units.

Now I'd like to turn the call back over to Jane.

Thank you, Franca. Before I turn the call over to questions, I want to welcome our new CFO, Rajeev Viswanathan who's going to be joining us next week.

Rajeev will be a very valued addition to our senior management team and I'm really excited about the skills and the perspective he's going to bring to complement our team. So, welcome Rajeev.

And now operator, I'm going to open the call for questions.

Same-store NOI was relatively flat but there has been some small slip in occupancy. Though for the second half of the year and maybe going to 2016, notwithstanding all the leasing that you've done, do you expect same-store NOI to remain flat to positive or should we expect some dip?

I think it's going to be flat with possibly a dip.

Okay. And it looked like the numbers were somewhat strong in suburban Calgary for the quarter.

Is that related to a few specific leases? Is that overall market strength relative to downtown Calgary?

Maybe expand on that a little?

Yes, Mark. I think that's specific just to our working our butts off on those properties.

There are five or six small deals and we've got some good momentum there. That markets remains challenging but we're working hard there.

Does that imply then, other markets are not or is it easier there than in downtown Calgary?

No, no. Definitely not.

No, I think it's just - we've had a good run of success there.

Okay. And maybe for the larger CapEx programs, Jane, Scotia Plaza and then the Barclays Centre, the property in Calgary.

With Scotia Plaza you said much of it is recoverable. Can you maybe just walk through how that works - how you're able to recover so much the big CapEx program and then maybe the big project in Calgary as well would that also be similar?

Well, in Scotia Plaza, the bank is two-thirds of the tenancy in the building and it's just part of their leases that we can do upgrades. The elevators are certainly recoverable but the program we're undertaking over the next three years.

And so it's just pursuant to their leases that you can amortize - do some of these costs and then amortize them. And then on Calgary -

We're just getting - we expect to be large part of that project will be recoverable the amenity space that we talked about finishing the conference center obviously is a benefit to the tenants and is run through the operating budget as is the main floor upgrades.

Mark, just to go back on the Scotia Plaza, by the way, when we negotiated the purchase price, we had identified some of the capital that needed to be done. The elevator, for example - first we've got a price reduction in respect of those.

And those are costs that also can be capitalized by the tenants so those will be recoverable, largely to the bank, by the way.

You know from your comments, it's quite clear that you're really outperforming the market from a leasing perspective and in your disenclosure you highlighted that you've got a new tenant experience strategy. I was hoping you could just tell us a little bit more about that and perhaps some examples of innovative ways that you're achieving this leasing success.

Sure. Well among other things just leasing in this organization is top of mind.

So once a week the entire leasing group across the country sits down and we go through every leasing professional goes through what's going on in their portfolio. We started a new group that's going to be focused on what's new and up and coming in terms of retail, tenant experience and getting ahead of the curve in terms of how office tenants are thinking about how they use space.

That's going to be incorporated into a big new construction group that we started so that we can fit out space quickly, make sure the tenants are choosing us first off so that they can get a great turnkey experience. I'm going to turn it over Andrew Reial right now because I want him to talk about some of the stuff he's thinking about in terms of the GTA west because it really speaks to how we're thinking about tenant amenities.

Okay. Well, in the suburban Tron, we've been really focusing on improving the amenities and the worklife experience for all of our tenants.

In the last quarter, we've added shuttle busses that take people from mass transit go stations, TTC to our buildings. We've added zip cars in other ways people can get around.

We've also adding a lot of exciting things - fitness facilities in all the buildings and we found operators to provide additional services, gym classes that they can really help out and people can get everything done during the day in our buildings and have a really great experience.

And we're looking at all across our portfolio how do we bring more amenities to the building and bring - build more loyalty in our tenants and improve our tenant retention ratios.

Okay. That's quite interesting.

Are there any I guess specific nuances to the tenant experience offering that you'd be going with in Calgary given that it's somewhat a unique market today?

You know, I think very similar to when Andrew said, I think we're seeing it really be a driver of tenant retention in the sense that Calgary historically has been very competitive for staffing and employment and so oil and gas companies and other companies are looking for those more than ever - those end of trip for cyclists, runners. So all of those kinds of things we're introducing to our core building so that in staff 444 as I spoke to earlier, we're introducing a conference center and a fitness center expanded bike parking there.

We're looking at Wi-Fi in some of our common areas, umbrellas at our lobby decks, all to really take an enhanced view of the tenant experience.

Two questions from my end. The first would be a high level question.

I guess multiple corporate structures but realistically when you look at the history of Dream you had experience in the office sector for over 15-plus years and we've gone through several cycles in the office market. I'm just wondering if you could give us some sense on how you would compare the dynamics in Canada that you're seeing today and how you could compare that back to periods of weakness we saw specifically I guess 2008, 2009 and then going back even further to the early part of the 2000s?

Just because I think the history of the question Jane asked me to answer. I think that Alberta is not dead.

I think on the margin, it's resting and there's a lot of uncertainty. But if you take Alberta out of the equation, I think what we're seeing is tremendous value in office buildings that are well located.

I think we're seeing a lot more use of office buildings for retail fitness - all the kind of amenities you're talking about. There's tremendous intensification.

A lot of restaurants. I think the underlying social fabric of what these office buildings fit into is fantastic.

I think in the suburbs we're seeing a tremendous growth of population and we're seeing what Andrew would call urban suburban or suburban suburban as two distinctnesses of buildings out in the suburbs and they have a big distinction as to the desirability. So I think we're seeing some real social changes in how people are living.

And I think net-net is probably quite good for real estate. We're seeing something unusual for this time which is an incredibly low cost of capital with debt costs as well as pension funds so we're seeing more supply than you would normally see at this kind of - part of the cycle.

And I think the values of buildings are higher. People are adding 27 stories of condos on top of a building.

We're seeing - it's a tremendously innovative and exciting time. So I think that that's a healthy back drop.

I think that Toronto was at 98% occupied right now. The new buildings are very well leased.

I don't think we're too fussed about air mile - [indiscernible] university or Scotia Plaza leasing we have there. The Aviva site that's coming up in a year or two is a great development site with incredible transportation probably worth as much as vacant land as it is.

So I think generally in Montreal, the deal we did with National Bank makes 700 La Gauchetiere bullet proof for a whole other cycle again so we're excited about that. So I think overall ex-Alberta, things have been pretty good.

Within Alberta, these guys are taking on the chops in just about every direction and I think what we're seeing is out of the election debate yesterday and every else, every bank, every international economic organization, the Bank of Canada has progressively had worse projections for Canada so I think that's really weighing heavily on Alberta. As you compare this to other times, nothing matches what happened in 1992 and I don't think we're going to see anything like that with this environment.

In 2008, I think what was really different was - and I remember writing a report to the Board that I called and everything turned to [indiscernible] because everywhere around the world things went bad at the same time. And I think what's disappointing for us is what's happening now uniquely bad in Canada.

I think the U.S. is doing well.

I think Europe in its own way kind has kind of outperformed. So this is completely different in 2008 but I think that that's the irony in that.

There's going to be growth elsewhere and that will help pull Canada out of this. Net-net I think on the margin we're working really hard.

I think you heard Paul talking about a whole bunch of leases in suburban Calgary. Overall, I think we've done quite well but I think Alberta is going to have about 18 months of uncertainty and on the margin I think we might be hurt in occupancy but I think the rest of the business is in really good shape.

So I think this is nothing like 2008 or 2009. I just think that it's a tougher time but as Franca had mentioned that we got a lot of debt available at low cost.

We got a good balance sheet. We got a lot of good things.

I don't know if it was mentioned but London City Centre we've re-done the main tenant there. 700 La Gauchetiere been done, 219 Lorea's been done.

These are big buildings that have had major, major leases on it. So business is going on pretty well.

I just think that [indiscernible] we have to show up a little bit earlier for work every day for a while.

Just a final question for me, as you guy talked about the increased CapEx spend and how 80% of that will be recoverable from your tenants and I think also mentioned or referring to the fact that you're putting higher tenant amenities such as fitness centers and shuttle buses and whatnot. So I'm not sure if you're aware of this.

One of your peers in the office space has recently amended their administrative fee charge to tenants at the property management level and also you know cap a cap on some of their costs and vacancy [indiscernible]. They put back bac to the tenant in an effort to become a little bit more tenant friendly.

Is that something you had any discussions with your tenants at the - late?

Look. Actually I don't know the situation you're talking about, Mike.

But we're doing everything to be responsive to our tenants and elbows out in terms of competition. So we're providing these amenities, we're being completely mindful about how we place ourselves in the market so it's a bit of a balancing of we're going to give all of the amenities we can but watch where the rents are going and it's a situation-by-situation case, Kevin, in Toronto has a different situation then Paul in Calgary.

But -

So I think on this one the key thing is the consistency of billing and I think we've been very consistent over the years to manage all of the costs in a way that's predictable for the tenants. I don't want to comment on what anybody else is doing but we do know tenants don't like surprises on the billing.

As we do CapEx. It gets amortized - CapEx that we used to do - the amortization ends and I think we're very focused on managing that process so the tenants get the best experience and the buildings are as valuable as possible.

I'm just wondering if you guys made any progress in terms of identifying some density potential maybe within the Toronto portfolio? And if so, how you plan on monetizing that or if would develop some of those stuff on your own?

Yes, I mean what we know is that our portfolio gets more valuable certainly in downtown Toronto and you can see there's not that many lots anymore available for construction so we continue to look at it. That's going to be a long-term project for us.

Michael mentioned the Aviva site. I mean that's probably more near term in terms of looking at how we sub divide that out or deal with on a development basis and then, of course, in terms of intensification, we're focused on retail so where we can - expanding our retail, changing office space to retail and so we're making more active progress on that side.

In terms of cap rates, A, can you provide an indication as to where the CAD130 million traded post quarter and then also how do you get comfortable on cap rates in Calgary at this point if it's more than an 18-month downturn?

On first question, on about CAD170 million - let me take a step back. When we look at IFRS values, we're fair valuing the asset.

The debt is not mark to market. So sometimes when we do a transaction, the debt has to be mark to market which could be 3% of the asset or something like that on average.

And that's partly because the interest rates are so low. So if we have to mark to market that's a bit - that's built in.

It's not reflected what's built in. So far on the closings, I think we're looking at about 4.5% under IFRS value on CAD170 million of assets.

Your question on Calgary the answer is nobody knows.

And then just finally, do you track sublease vacancy within the portfolio? I know you have smaller tenancies so it may be difficult but have any sense as to whether there's significant sublet vacancy?

Yes, I think, Matt, you said it. It's really tough to track for us because of our smaller unit size.

Maybe a couple of broader macro questions, Michael, you mentioned something that's maybe a bit different this time around is on the supply side - you're seeing a bit of development at this stage of the cycle that maybe perhaps you went through in the past. Can you comment on the motivations for development for your peers?

Obviously pension funds have a lot of potential development [indiscernible] parking lots out there. Do you have a sense that they're becoming more risk tolerant in terms of proceeding with developments that preleasing levels that historically would have been low simply because they're continuing to look for increased allocations to real assets in a low bond yield environment?

I think you answered the question. I mean I'll say the same thing back if you like which is I think what we're seeing is there's a tremendous demand for long-term hard assets in the private markets and I know that Jane and I have been stunned to watch the open-ended funds in Germany continue to be popular even with their fee structure because people are so content not to have ownership interest in something that trades in the stock market.

So that been a surprise to me because I always thought that if you had an asset plus liquidity it'd be worth more than an asset without liquidity but I think it's proving itself out everywhere that private assets are worth more than public assets. With regards to development, I think that the large pools of capital take the view that in terms of risk management, they're managing the risks because they have a lot of other assets in addition to the development asset.

So we're seeing more development than you would have seen from an entrepreneurial based industry now. That's for sure.

But if you look at the different markets, I think Toronto has done an incredible job of absorbing the new supply. Calgary is kind of getting whipsawed with having some new buildings where, in some of those cases, tenants are subletting some of the space that haven't taken yet.

But I say the most interesting market is Edmonton because what they're doing with the ice district is really try to create a sensational center for Edmonton. 7% of the people in Edmonton go downtown to work.

It's an incredibly small percentage. And I think what Edmonton is trying to do is create an environment in the center that would attack more people to have office jobs downtown in Edmonton.

So that one is an interesting one because if they're successful, I think it would be good for our buildings but we're seeing more supply across the full spectrum.

And so looking ahead outside of what we thought of today, do you view the risk of speculative development in Canada as being higher than it has been in the past?

Okay. I feel like I'm on the witness stand.

I would say that for almost 20 years, there was almost no speculative development at all and it would have been preposterous to contemplate that. So I think recently, we're starting to see some speculative component of developments so it is more than before.

But before it was zero. I think that the pension funds are being cautious at this point.

Just a couple of specific questions with respect to your portfolio, first 438 university and then 700 DLG. At 438 University, you highlighted really good demand.

Give you us a sense in terms of the types of tenants and where they're coming from? I know they are looking at the space there today?

Absolutely, Mario. It's Kevin Hardy.

I'd say not surprisingly to us, we have - we're really confident in that asset and the spectrum of tenants looking at the it and the four or five groups that we're talking to really range from institutional to finance and mining, legal. So it's a broad spectrum of tenants where we believe the asset is really appealing to all kinds of different groups so it's proving out in terms of 438.

For Montreal -

Yes. Sorry, for Montreal, can you give us a sense in terms of how the proactive pro forma economics look relative to what was in place before?

I'm not sure what you're asking, Mario.

Just in terms of the new economics on the lease extension how they compare to what was in place before the 700 de La Gauchetiere?

The extension on National Bank we did was - not a seven-year extension on the 2020 executive expiree and there's a bit of a blend down but it still stays within the market and secures the bank long term when their [indiscernible] I think is very positive.

That's excellent. Thank you very much, everybody.

We look forward to talking to you next quarter.