Tricon Residential Inc.

Wojtek Nowak - IR Gary Berman - CEO Wissam Francis - CFO Craig Mode - Managing Director Adrian Rocca - Director Private Equity

Geoff Kwan - RBC Capital Markets Dean Wilkinson - CIBC Jonathan Kelcher - TD Securities Stephen MacLeod - BMO Capital Markets Jimmy Shan - GMP

Thank you Sean and good morning everyone and thank you for joining us to discuss Tricon's results for the three months ended March 31, 2016 which were shared in the news release we distributed yesterday. I would like to remind you that our remarks and answers to your questions may contain forward looking statements and information about future events and the performance of our business.

This information by nature is subject to risk and uncertainties that may cause actual events or results to differ materially. A detailed review of such risk factors is included in our most recent management discussion and analysis and annual information form which are available on CEDAR.

I would also like to remind everyone that all figures are being quoted in U.S. dollars unless otherwise stated.

Please note that this call's available by webcast at triconcapital.com and a replay will be accessible until May 19th 2016. Lastly, please note that during this call we will be referring to a supplementary conference call presentation which we have posted on our website.

If you haven't accessed it already it will be a useful tool to help you follow along during the call. You can find the presentation in the investor section of triconcapital.com under news and events.

With that I will turn the call over to Wissam Francis our Chief Financial Officer for a review of our financial results followed by Gary Berman our President and Chief Executive Officer who will discuss our operational results and provide a strategic overview of our investment verticals.

Thank you Wojtek and good morning everyone. We're trying something new this quarter by adding a slide presentation to follow along with our prepared remarks.

This was done in response to feedback from some of our shareholders and as such please let us know if you find the support helpful or if there're other ways in which we can improve in how we report and communicate. Moving on to our financial results Q1 was a strong quarter for us as we started 2016 with continued assets under management growth and operational successes across all of our verticals.

Let me recap some of the key highlights for the quarter. Our AUM increased by 26% year-over-year and currently stands at 2.8 billion or 3.6 billion in Canadian dollars.

Since Q4 of 2015 assets under management increased by 4% as a result of new investments in all verticals during the quarter. On Slide 5 of the conference call presentation we show the change in our AUM over the past quarter.

Let me outline the major changes. In Tricon Housing Partners, our land and home building investment vertical, we added a new land investment in Queen Creek Arizona.

In Tricon American Homes, our single family rented platform. We added 410 net new homes to the portfolio.

In Tricon Lifestyle Communities, our land lease business, we closed on five new communities in the quarter and in Tricon Luxury Residences, our new Class A multifamily rental development vertical, we added a new Canadian project at 57, Spadina in Toronto and continued development of our three existing projects. This growth in AUM was offset by distributions received from THP1 US which distributed 79 million of cash in the quarter including 54 million directly to Tricon.

Most of the proceeds came from the sale of TLR preserved land asset which we announced in March. Turning over to Slide 6 where we outline the various components of the adjusted revenue.

Contractual fees for the quarter were stable compared to Q1 2015, positive contributions from the Veridian separate account investment, a commitment fee on the new Queen Creek investment and the new TLR project which generated developed and management fees in Canada and equity supervisor fees in the U.S. But these were offset by lower fee revenue from legacy private investment vehicles which are in harvest mode.

And a lower fees from jobs and attributed to the timing of sales which Gary will elaborate on later. At Tricon Holding Partners investment income in decreased to 7.9 million compared to 12.4 million in Q1 2015.

This was mainly driven by lower valuations gains on investments compared to the prior year, on various projects attained significant development milestones that positively affected their valuation. In addition investment income decreased due to lower investment balances as distributions were received and investments were realized.

At Tricon American Homes investment income consists of two key components. Investment income excluding fair value gain and MCI was $8.6 million compared to $4.5 million last quarter, a solid last year -- a solid gain of 91% mainly related to growth in the portfolio.

The other component was a fair value gain of $9.4 million compared to $19.5 million last year. You may recall that last year we obtained detailed BPO valuations for over 2,000 homes.

As we prepare for our first securitization transaction. This was a more precise valuation method which yielded a strong valuation gain compared to a more conservative HPI valuation method we used in Q1 2016.

And so while this year result is solid in its own right, it is not a true apples-to-apples comparison with prior year. Tricon life stock community’s investment income was $1.3 million compared to $0.2 million for Q1 2015 as we grew the portfolio from one park to 10 parks and enhance operations of the new acquisitions.

In our Tricon luxury residences, our new Class A purpose built rental verticals, investment income was $1.3 million primarily a result of fair value gain recognized on the McKenzie in Dallas, as construction commenced on the projects in Q1. The completion of entitlements, closing of the construction loans and product construction represent significant development milestones and definitely-risking events for the project.

Slide 7 provides a bridge of our adjusted revenue to adjusted EBITDA and earnings. In terms of corporate operating expenses, compensation expense increased by $1.2 million from last year to $5.7 million in Q1 2016.

The increase was largely related to expanding our team to support our four investment verticals for future growth. We expect total compensation expense to remain between $5 million to $6 million per quarter over the near term.

General and administration expense was $1.4 million in Q1 2016, largely consistent with Q1 2015 and is expected to remain near this level over the coming quarters. Adjusted EBITDA was lower by $9.1 million largely because of the fair value gain at TAH.

Let me emphasize this point. If we strip out the fair value gains we actually had a great quarter with adjusted EBITDA increasing by $1 million year-over-year.

For the same reasons mentioned earlier, our adjusted earnings per share decreased year-over-year. Let me remind everyone that we have a higher number of common shares outstanding following the bought deal share offering completed in Q3 of 2015.

We issued approximately 13.2 million common shares for gross proceeds of CAD150 million and deployed the net proceeds into new investment opportunities that are expected to be accretive to earnings per share over time. Lastly on Slide 8, we provide a summary of our liquidity position.

We have access to credit facility of 235 million to deploy into growth initiatives within our four various verticals. As of March 31, 2016 approximately $77 million was drawn on the facility and we had close to $30 million of cash at the corporate level for a net debt balance of $47 million.

Another significant source of liquidity for us is THP1 US. We received $54 million from our co-investment in the fund in Q1 and we’re still on track to receive another $200 million or thereabouts between now and 2018.

The next major project to track is Rockwell a condominium project at Pine and Franklin in Downtown, San Francisco. The project is nearly sold out and approaching the end of construction with closing and distributions expected by early 2017.

And this is expected to be another major source of cash contributions to Tricon similar to Faria Preserve. Finally, as Tricon American Homes following quarter ended dedicated warehouse credit facility was upsized from $300 million to $400 million giving us ample runway to build a portfolio with approximately $280 million drawn as of Q1 2016.

At this point, I’ll turn the call over to Gary who will provide additional insight into our business verticals.

Thank you, Sam. I’d like to walk you through some of our achievements this quarter, and talk about the growth prospects for each of our verticals starting with Tricon Housing Partners on Slide 10.

Q1 was a solid quarter for THP particularly from a cash flow generation perspective. As Sam mentioned our THP1 US co-investment received $54 million primarily as a result of the completed sale of Faria Preserve, a land investment within the Greater Bay Portfolio and less than three years Tricon has received a total of $186 million of distributions from its $260 million investment in THP1 US.

THP also closed on $15 million land investment in Queen Creek and Southeast Valley of Phoenix, Arizona. This is a relatively small investment, but we wanted to give you some insight into how we think about deals and what we are looking for.

Slide 11 provides additional detail on this investment, entails the purchase of fully zoned 128 acre parcel of land in Queen Creek, an affluent suburban Phoenix with a portion to acquire this land from receivership at a fairly advanced stage development with all entitlements in place and no need for outside infrastructure. As you can see from the aerial photo the land is surrounded by existing development and recent amenities.

It is well located along the transportation court of Auschwitz Road, approximately 3.5 miles south of the loop 202 freeway and less than 1 mile north of the Queen Creek marketplace and 800,000 square foot retail and entertainment note. The site is also short drive to the Price Road corridor, a major employment note that is home to Intel, Orbital Science, [indiscernible] and Wells Fargo.

This line has many ways like a whole Madonna with many development surrounding it. The only undeveloped area that you can see in the photo is restricted flight path for the Mesa Gateway a small regional airport.

The business plans developed about 350 single family lots and sell these for homebuilders over the next 24 to 36 months. In addition, there are 15 acres of commercial land to be developed.

In terms of structure, the project was funded 85% by Tricon and 15% by community Southwest, a long time development partner for Tricon and was underwritten to generate the stronger turnover in the short investment horizon. Going forward we intent to warehouse land and home building investments on our balance sheet and then syndicate them to third party investors upfront once the projects refer to de-risked.

We plan to focus on two types of investments as shown on Slide 12. The first type is smaller, short duration investments like Queen Creek which provides us with good visibility into the current cycle and are underwritten to generate higher IRRs about potentially lower ROI multiples.

The second type is longer duration investments in master planned communities and active idle communities. Our preference here is to acquire existing cash flowing assets with loss in homes on the ground were previous investors have taken the Greenfield risk to entitle the sight and install off sites up front infrastructure and community amenities as well as establish interest from home builders and consumers alike through our large sales program.

Our recycling of capital that is distributed from existing land and home building investments back into THP, we intent to maintain steady AUM and related contractual fees while using the gains to profit to grow our three income producing verticals. That’s a good Segway.

So let’s turn our attention to Tricon American Homes on Slide 13. In Q1 2016 we continue to focus on execution at the operating level.

I’d like to highlight several key metrics. First, TAH it’s achieved the acquisition target by purchasing 482 homes and selling 72 non-core homes for a net increase of 410 homes in Q1.

Second, in place occupancy of 88% and stabilized occupancy of 95% remains stable compared to year end 2015. Third, operating margin was maintained at 60% Q1 which is consistent with a full year of 2015.

Poor tenant turnover came in lower than we’d anticipated at 26.7% , our long-term expectation for turnover is 30% to 33% meaning residents will stay in our homes for roughly 3 years. And last TAH was able to grow rents by 4.1% in Q1 including 3.6% of renewals and 4.5% on new move-ins.

Tricon American Homes also consolidated its head office operations in Orange County, California. TAH has 250 employees across the U.S.

led by a seven person executive team and it continuously strengthening its platform for future growth and operational improvement. In terms of growth objective, you can see on Slide 14, how the TAH portfolio has grown through a disciplined acquisition strategy and geographic expansion since 2012.

TAH remains focused on getting efficient scale in its 14 target markets and remain on pace to acquire 400 net homes in the current quarter. Also given the current geographic mix, we expect TAH operating margin to remain at 60%.

We see ample growth opportunities in the single family rental market given that there are 15 million rental homes in the U.S. and only 200,000 or so are under institutional ownership.

Our current acquisition pace, we can double the portfolio in less than five year. Moving along to Tricon lifestyle communities on Slide 15, Q1 marks a significant achievement with the acquisition of the portfolio of 5 parks in Arizona bringing the TLC portfolio to 10 parks with almost 2,500 pads and 86 million of AUM.

In Q1 we achieved a least turnover rate of 3.9% and we’re able to grow rents by 2.4% resulting in an average monthly rent of $378 per pad. On Slide 16, we show how the new acquisition will impact the TLC portfolio.

The acquisition of Sun portfolio was completed at the cost of 34 million representing a going in purchase cap rate of 6.7%. It consists of 5 age restricted manufacture housing communities and a total of 1,349 pads.

In conjunction with the acquisition, TLC secured a financing package within average advanced rate of 65% of loan to value and a weighted average interest rate of 4.63%. We view this acquisition as a terrific value add opportunity, you can see that the in place occupancy of the parks is only 65% which is lower than the occupancy of 89% in our existing parks and take for a blended occupancy to about 76%.

We essentially received 476 pads for free and we see significant room to drive NOI by increasing occupancy and rents in this portfolio as TLC implements its enhancement CapEx program and improves the resident experience. We have already demonstrated our ability to do this at long heaven and so we are hopeful that we can achieve even better results for the Sun portfolio.

Looking ahead, TLC has already entered into a binding contract to purchase in age restricted community in Mesa, Arizona for 8.8 million. The park is comprise of a 177 residential pads and the transaction is expected to close in Q2, 2016.

In 2016, TLC will continue to execute in an active acquisition pipeline of 100 million mainly in Phoenix as well as potential new markets in Florida and California. We have done well so far in terms of our acquisitions -- [technical difficulty].

Okay so it sounds like the call got dropped. We apologize for the technical difficulties.

I'm going to back and recap Tricon Luxury Residences and then we'll go to Q&A. So back to Slide 17, Tricon Luxury Residences a vertical we only officially entered in last year, we're happy to report that we now have four projects close in a relatively short period of time, two in Canada and two in the U.S.

with combined AUM of a 168 million. On Slide 18 you can see our two U.S.

developments. At our first project The McKenzie and Dallas, entitlements are in place, construction financing is closed and construction is now underway.

Our second project Canals at Grand Park II in Frisco, Texas is now officially branded the Maxwell. The project closed its construction loan subsequent to quarter end and recently started construction.

On Slide 19 we show our two Canada projects. Our first Toronto based investment of 592, Sherbourne Street known as the Selby is under construction with a majority of hard cost now tentative price slightly better than budget.

Our second Toronto based investment of 57, Spadina closed during Q1, this project will be a 36 story development located in one half blocks south of King Street on Spadina Avenue. Tricon has partnered with a major Canadian pension plan to form a 43 million Canadian separate account with Tricon funding 20% of the commitment.

Pre-development of 57, Spadina has commenced with construction expected to start in Q1 2018 once the existing leased premises are vacated. We continue to focus on growing this vertical.

We're currently pursuing an active pipeline investments in Phoenix and San Diego that are projected to commence development in 2016. We also have several projects in the pipeline in Toronto.

TLR's built-to-core strategy is very attractive to third party institutional investors as rental apartments are a familiar after class. As a result we're seeing good level of interest from third parties looking to participate in our investments.

With the help of third party capital we aim to grow TLR towards 1 billion of AUM in the next few years. Turning to Private Funds and Advisory, which represents our fees and third party AUM as well as our advisory income streams, you can see on Slide 20 the total contractual fees in just GP distributions were flat compared to last year but this is a combination of both positive and negative dynamics.

As Sam mentioned earlier, contractual fees excluding Johnson were up substantially benefiting from incremental revenue related to Viridian, Queen Creek and TLR investments. The offset with Johnson revenues which were lower this quarter compared to last year as the large commercial land sale was delayed and a number of lot transactions were pushed out in the Q2.

We expect Johnson sales to fluctuate quarter-to-quarter because of the timing of large land parcel transactions which are episodic in nature and can have a material impact on Johnson’s quarterly earnings. Nevertheless, Johnson continues to see resilient home sales across its portfolio of leading master plan communities which bodes well for future land sales as homebuilders continuously need to replenish their inventories.

Year-to-date, home sales at Johnson communities were in line with last year reflecting successful new product launches at Harvest Green and Sienna Plantation expansion in for the Dallas market for the Viridian acquisition as well as stable sales across Creek Ranch and Woodforest. In conclusion, we are very happy with the progress we’re making in all of our verticals and excited about the growth prospects.

Looking at Slide 21 it's remarkable how far we come in only a few years. Since going public in 2010, we’ve grown our AUM from just under 1 billion to almost 3 billion today, our longer term goal is to reach 5 billion and we believe we can do that in three to five years.

With the strategy in place our goal now is to focus on execution and producing a growing stream of predictable cash flows over time. Lastly, I would like to invite everyone to attend our Annual Meeting on May 25th.

You will find the relevant details in Slide 22. With that I will pass the call back to Shawn to take questions with other senior members of our management team.

The first question I have was just on the SFR side, the potential securitization. Just wanted to see if you can talk about potential timing?

And more specifically if you guys are going to go down that route again, is the consideration maybe more around where the funding costs are playing from the market? Or is it maybe a little bit more of having a specific deal size in mind?

So timing is really probably at the back part of this year. We need to acquire more homes and we’re doing that this quarter to really get the size to a level that makes sense in the market.

So I think with homes in place this quarter Q2, or in Q2 I should say we should be there Geoff and then it’ll obviously take a few months to work through the process. So we’re looking at time for the end of the year.

And as part of our -- it's the part of the process we’re going through in the ordinary course of business. So as you know we acquire the homes for cash, we then stabilize them, we put them on our credit facility When we get to a significant scale in this case, let's say it's 3,500 homes on the credit facility, we then can roll it into the securitization trust and lower our cost of capital.

So that’s the plan.

Maybe just ask it a little bit of a different way is, assuming that you get -- or when you get to this size to be able to make the economics work for you. How much do funding cost play into it?

Is it as long as it's a reasonable cost you guys are okay with it? Or would you look to try and be opportunistic if the funding costs become more favorable?

Certainly we’re always going to look at funding cost, but it's also a question of what are the alternatives. And right now I think the best opportunity in single family rentals sector is and continues to be securitization.

And so even though spreads are widening I think fairly substantially since we did the first deal. In fact it could be 100 basis points wider than when we did the deal of LIBOR plus 196, it's still make sense.

And so I think at those type of rates Geoff, we’ll continue to move forward securitization. The real issue I think will be that we want to continue to flow to fix and that’s something we’ll determine later in the year.

Gary could you just remind me on the TLR, the funding mechanism for that? Are those separate accounts with a finite life or is it just an ownership interest that continues on in perpetuity?

For TLR Canada that is a separate account with one of our existing long standing pension plan partners. There is no finite life, this is developed for a strategy, these are long-term holds.

There is a valuation mechanism where performance fees are paid in year 10, so 10 years after we acquire the site. But it would be a shoulder-to-shoulder hope on our balance sheet with our partner.

And then the 10 years, there is no sunset on that, the short come [indiscernible] or anything like that?

Correct.

And Dean in the U.S. we obviously do not have any third party investors yet, but that’s something we’re working overtime.

Then just on the unfunded commitment within the principle investments, the 78 million. Am I right to read that that is fully covered from the net proceeds of THP1, give or take timing issues?

Yes, that’s correct.

And would there be excess or?

So when we’re projecting and guiding the market that we think there is going to be another 200 million of cash flow from now through the end of 2018, we’re taking into account any potential contributions and there should be additional cash out for 2018, but we’re just guiding from now till 2018. So that’s the net number.

Perfect. Okay, that’s a net number, great.

And then just in Veridian is the grass dry and are you back on the ground or is that still sort of working its way out?

Yeah, I am going to hand that over to Craig Mode to give you a little more detail as to what’s happening on the ground in Veridian.

Yeah, we continue to have pretty strong rain events in kind of a cross detective markets, but we’re passed the point where that was really critical in impacting the delivery and timing of lot sales. So we are back actively selling lots at this point in time and expect pretty significant deliveries through Q2 and Q3 of this year.

So, anything that you would have missed in Q1 just been pushed back out into those quarters?

Correct. Yeah, all of those lots are.

Perfect. And then my last, just looks in TAH, it looks to me like you’ve got something in the acquisition capacity of 250 to 300 million without having to do anything.

Am I looking at that right?

Yeah, that’s correct. I mean if you look at the -- I mean there are lot of different ways to look at it, but or to skin the cat, just giving the exact different verticals.

But I mean if you look at the capacity on a credit facility and then you looked at the capacity on our TAH dedicated warehouse facility. That together is roughly 300 million, I’m rounding and if you assume that and I’ll be conservative that the average all-in costs with renovation of the homes is a 150,000 for us and another 2,000 homes.

Another 2,000. That’s where I was thinking.

Perfect. That’s all I had.

Thanks guys.

First just on the land and housing business, could you maybe give us a little color on your current pipeline there. I think you’ll close on a large scale this year?

Yeah, I mean we’re hoping that we can I mean these large master plan communities, John, come off from time-to-time. We obviously can’t control when they happen, but we’re the first call and we’re incredibly selective when we do see opportunities.

But our hope is that we can acquire one maybe two per year. So that I think is still our plan.

And then in addition to Queen Creek, we’ve also got one or two other smaller deals that are in the pipe and our plan once we get -- if we get to that stage in closing on those deals then we’ll syndicate them.

Okay. Are you looking at any big ones right now?

Yeah, we are. We’re always looking at big ones and we can’t comment more than that, but we are, we always have our feelers out there.

Okay. Fair enough.

And then just turning to the TLC portfolio, if we look at the 65% occupancy you have at the Sun portfolio, how much do you think you can grow it and over what timeframe?

Yeah, I’ll hand that to Adrian.

Yeah, I would say so what we’ve underwritten in that deal, we underwrite all of our parts on a 10 year basis. I think overtime, over a kind of 5 year period we should get let’s say 10% increase in our occupancy conservatively and that will be a combination of selling homes but those are brand new homes, existing inventory homes that we essentially got for free in the portfolio but are 130 homes in total and as well as kind of we’re seeing new homes as well.

So I’d say 10% over the next 5 years is where we would expect it to actually have.

Okay. And that 6.7 cap rate is on the current NOI, right in place NOI.

Right. In on the place NOI.

Okay. Did you guys look at the carefree portfolio at all that was that a little bit too much to take?

Yeah, we did. We did look at the carefree.

It was a high quality portfolio and an exciting opportunity and we bid on it in a consortium and my understanding is we came second on it. We were just not willing to stretch any further and so we ended up going to a pretty keen cap rate, but we were in the running.

Okay. That’s it from me.

Thank guys.

I just want to follow up on the THP business with respect to Slide 12, you’ve outlined kind of 2 types of projects and I just wanted to get a sense as to what the pace of new investments would look like and whether you have a preference for in-fill versus master planned communities?

We wanted to do both because as the slide speaks we want to really combine this kind of shorter term duration investment where we really get good visibility into the cycle and we can move quickly through them like Queen Creek and then the longer term cash flowing projects like Veridian. So we’re looking for both we’d love to do kind of one large deal a year and do a handful of smaller deals per year.

And by doing that we can basically maintain our AUM and THP and then cycle any profits into the other income producing verticals.

Okay, so that would be kind of like a $150 million to $200 million in annual deployment, is that right.

Yes, that sounds about right. I mean remember we're opportunistic, so that’ll ebb and flow but yes that sounds reasonable Steve.

Okay, just as an average. Okay great and you mentioned Rockwell being the next kind of cash flow catalyst on THP1 US.

Can you talk a little bit about the timing of those cash flows and what the numbers potentially would look like?

It's a major contributor, I can't give you the exact number but I would say it’s kind of in the ball park of what we received over time from Faria Preserve. So it's going to be a major contributor and the timing would probably be very early Q1 2017.

Okay great. Okay and then just turning to the financial statement so the performance fees, there were none in Q1, I was just wondering is that, do you expect that to continue to be zero or is that just a function of kind of how things fell out for Q1.

No I mean we expect there to be some performance fees this year and certainly more next year, if you look at THP1 Canada all the capital now has been repaid, you can see that on the AUM and so any future distributions to come in will generate performance fees. We have one master plan there in Edmonton called Heritage Valley, it's in south west Edmonton and so, you know the master plan is doing well but things are slower than they've been and so I think the timing on the cash flow will be a little later than we had thought.

And then we've got other syndicate investments which are nearing completion too which should also generate some performance fees for us this year and maybe next year.

Okay great, and then just finally on the TH portfolio, you may have mentioned this in the slide and I may have missed it I apologize if that's the case. I just wanted to get your sense as to what you're sort of expecting in terms of reasonable expectations for rent increases, NOI margin, and occupancy rates from where we are today.

Yes, I think we're going to be stable. I think our NOI margin was 60% in Q1, it was 60% for the full year for 2015, that might you know fluctuate a little bit from quarter to quarter because sometimes it's seasonal but on a full year we would expect 60% with the existing geographic mix.

On occupancy from a stabilized perspective, we'd continue to expect to be at 95%, we're seeing lots of demand. And I forgot what your other -- rent increases.

So on rent increases you know we've had more of an occupancy bias Steve, so we've averaged about 4% in Q1 which is healthy but we have had more of an occupancy bias. I think we'll, I think we'll continue to be able to do roughly 3% to 4% for the year as well.

Okay, that's great, okay thank you very much.

Thanks good morning guys, just had one follow up on the occupancy bias comments, just kind of wondering as to how you think about the tradeoff between pushing the rents and pushing turnover. And is the view of that maybe we'll -- the goal is to reduce the turnover rate as opposed to being aggressive on the rents.

Yes, that's right, I mean just one of the things that really drives this business and allows us to achieve you know margins that are very similar to multifamily is the turnover. You want to keep people in the homes for as long as possible and so you're better off to keep the turnover lower than really push rents, we don't think it makes sense to be greedy, but obviously if you are at 95% or 96% then we can start to get a little bit more aggressive.

But at the end of the day we'd rather have lower turnover than risk, than take risk -- than chances with higher rents and have more people move out.

So from the same store NOI growth perspective then how do you think that'll play out on the stabilized assets over the next 12 months?

I mean, I think the growth on a same store basis and by the way that's something that we need to spend more time on Jimmy in terms of -- and I will add that you know the whole, all our peers have been doing a lot of work with Greenstreet to try to come up with common or standard metrics for the industry so when we report results there apples-to-apples across our peers, and so we are going to be coming up with metrics which really define same store and core portfolios which will kind of help you as you think about it. But I think you know from a same store perspective I would expect you know again I would expect revenue to increase 3% to 4% as I said to Steve and for our margin to hold steady.

Okay, alright and then turning to the discussion on the BPO valuation versus the HPI it's been a year since you -- most of the assets have been BPO valued. So if the whole portfolio were to be valued under that methodology today how likely do you think it'll be higher than the current value using HPI and how much higher do you think it'll be if that's the case?

I'm guessing, I think it would be higher, Jimmy, but I can't I can’t give you a more specific answer than that. And without having -- we’ll obviously we'll have to do BPOs again when we do the next securitization at the end of the year and that will give us obviously a lot more insight.

But without actually doing them I can’t tell you.

Well, in terms of the non-core assets, how would the values compare?

On the non-core, you mean between [Multiple Speakers].

So in the sale proceeds versus the value that you have.

So in Q1 we were little above -- the actual sales were little bit higher than the carrying value, the fair market value.

Lastly just to confirm, so on the liquidity side at the corporate level you’ve got 188 million and then at the TAH level 167 million, so combined you have something like 350 million to deploy not including the cash flows coming from THP1 US?

Yes, that’s correct.

And the intent is to fully draw on those lines in the next 12 months?

Well, I am not necessarily fully drawn on our corporate credit facility, but certainly we would draw any TAH warehouse facility. And then again once we get critical scale on the TAH warehouse facility we would then move that into a securitization trust.

Thank you, Shawn. I would like to thank all of you on the call for your participation.

And we look forward to speaking to you in August when we discuss our results for Q2 2016.