Suzy Hollinger - Director, IR Stan Kuriyama - CEO Paul Ito - CFO Chris Benjamin - President and COO George Morvis - VP, Corporate Development David Haverly - SVP of Leasing, A&B Property Lance Parker - SVP of Acquisitions and Dispositions, A&B Property.

Sheila McGrath - Evercore ISI Steve O'Hara - Sidoti & Company Young Ku - Wells Fargo Wilkes Graham - Compass Point.

Good day, ladies and gentlemen, and welcome to the Q2 2015 Alexander & Baldwin Earnings Conference Call. My name is Latoya, and I'll be your operator for today. At this time, all participants in listen-only mode. Later we will conduct a question-and-answer session.

[Operator Instructions] I would now like to turn the call over to the Director of Investor Relations, Miss Suzy Hollinger. Please proceed..

Thank you, Latoya. Aloha and welcome to Alexander & Baldwin's second quarter 2015 earnings call. On the call with me today are Stan Kuriyama, Chairman and CEO; Chris Benjamin, President and COO; George Morvis, Vice President, Corporate Development; and Paul Ito, Senior Vice President and CFO.

Also with us today from A&B Property's are Lance Parker, Senior Vice President of Acquisitions and Dispositions, and David Haverly, Senior Vice President of Leasing, who will participate in the question-and-answer portion of the call.

Before we commence, please note that statements in this call and presentation that are not historical facts, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve a number of risks and uncertainties that could cause actual results to differ materially from those contemplated by the relevant forward-looking statements.

Factors that could cause actual results to differ materially from those contemplated statements include without limitation those described on Page 17 through 30 of the company’s annual report on Form 10-K and in other subsequent filings with the SEC.

These forward-looking statements are not guarantees of future performance and we do not undertake any obligation to update our forward-looking statements. Management will be referring to non-GAAP financial measures when discussing results.

In particular, we will be referring to NOI when discussing leasing segment results and EBITDA when discussing performance of the Materials & Construction segment. Included in the appendix of today's presentation slides is a statement regarding our use of these non-GAAP financial measures and required reconciliation.

Slides from this presentation are available for download at our website, www.alexanderbaldwin.com. Slide 3 provides an agenda for today's presentation, after which we will take your questions. We'll start with Stan, who will comment on results and review highlights..

Thank you, Suzy, and good afternoon, everyone. As noted in our release the company reported earnings of $0.20 a share for the second quarter of 2015.

Results were driven by continued strength in our real estate operations including the sale of three Kahala Avenue properties for $24 million and Maui business parcel sale for $4.4 million and strong improvement in leasing performance.

Turning to recent highlights, I’m pleased to report that over the 450 tower and mid raise units at our collection project, 98% have now been presold under binding contracts. Six sales were closed at Kukui'ula in the second quarter and two more sales closed in July brining total closing for the year to 11.

We currently have binding contracts for another 14 units in Escrow, 13 of which are expected to close by year end. At Maui Business Park we closed a 2.4 acre parcel sale in May at $42 per square foot and have another 11 acres under binding contract to Lowes that we expect to close in the third quarter.

With Maui’s first target store already opened in March, Lowes will be another stronger retail anchor for the business park. Leasing continues to perform well, for the quarter we had a 16% increase in operating profit and a 9% improvement in NOI over last year bolstered primarily by Hawaii same-store growth.

Our Materials and Construction segment generated EBITDA of nearly $10 million. This was a little lower than anticipated due to a decline in the price of asphalt we sold due to drop in oil prices, but we’re pleased with the 22% increase in backlog from the end of March to $251 million.

Agribusiness incurred a loss in the quarter which we will discuss in more detail later. Hawaii’s economy continues to improve. Visitor arrivals and expenditures were up roughly 4% through June on pace for our fourth consecutive record year. Construction is picking up significantly.

The value of statewide private sector construction permits was up 41% year-to-date through May compared to last year led by an increase in commercial and residential permits. Tourism and the strengthening construction sector are driving improved performance across the broader Hawaii economy.

Unemployment for example was 4% at the end of June compared to 4.4% last year. Bankruptcy filings were lower by 10% for the first half of the year compared to the prior year.

Foreclosures declined by 18% year-to-date through May and First Hawaiian Bank reported that its debit and credit card same-store sales volume increased 6% for the second quarter compared to last year. Oahu residential real estate continues to perform well.

The median resale prices for single family home in June was $700,000, the second highest price in the State’s history. The median resale price for our condo units declined year-over-year from $360,000 to $340,000 for June, but the number of units sold increased by over 20%.

At the end of June, housing supply in Oahu stood at 3.2 months of available inventory for single family homes and 3.5 months for condos. Median days in market were about 20 days for both homes and condos. Oahu’s commercial real estate markets are also performing well.

Retail asking rents climbed 9% in the second quarter compared to last year and vacancy remained low at 3.8%. Vacancy for industrial space was even lower at 2% and asking rents increased 11% in the second quarter compared to last year. Office rents improved by 4% in the quarter despite a slightly decline in occupancy.

And with that, I'd like now Chris to update you on our real-estate and agribusiness segments..

Thank you, Stan. We had a very good quarter in real estate once again with strong sales activity and with growth in same-store performance at our Hawaii commercial properties. Starting on the development side, the collection rise in Honolulu is nearly sold out with 439 binding sales contracts out of the 450 tower and mid rise units.

Construction continues in earnest and we just poured the sixth floor of the tower. The average price per square foot of the tower mid rise units is about $770 and this continues to be an attractive project for local buyers with 85% of contracted sales to local residents.

The 14 town homes, the last phase of the project were released for sale a couple weeks ago. So we’ll have an update next quarter on our sales status. Also on Oahu at our Kahala Avenue portfolio three properties closed in the second quarter an oceanfront lot and two mountain side properties that were sold for $24.3 million total.

These sales bring the portfolio gross revenue to $123 million nearly recapturing the initial $128 million acquisition price for the portfolio. Of the remaining nine unsold properties along Kahala Avenue four lots representing 70% of the remaining square footage are the higher value oceanfront properties.

Moving to Maui now, as Stan mentioned we're seeing continued sales interest at Maui Business Park driven by its great location as well as the opening of Maui’s first target store in March. Year-to-date we've closed two parcels -- totaling 6.4 acres at an average price of $45 per square foot.

Another 11 acres are being sold to those with closing expected later this quarter. The average price per square foot for this sale will be consistent with the average prices for our other large parcel sales in an adjunct -- in and adjunct to the park, which have been in the $38 to $40 per square foot range.

Lowes will be building a 167,000 square foot store at Maui Business Park, 16% larger than its current store and we look forward to their ground breaking later this year. Also on Maui we’re pleased to be advancing two important residential developments.

Pre sales begin in July on Keala 'O Wailea, our planned 70 unit condominium project in the Wailea resort with strong initial results and we’re making good progress in advancing Kai Lani, our primary residential project in Kihei which we expect to bring to market next year.

Moving on to Kailua and Kukui'ula on Slide 13, eight custom lots and one club cottage closed in the first half of 2015. Prices for the custom lots average $1.1 million and the club cottage was sold for $2.9 million. Increasing activity on lot sales is a very positive sign as it means more and more buyers are willing to design and build custom homes.

In fact 11 members currently have homes under construction. In addition to the first half sales, we closed two custom lots in July and have another 14 binding contracts in Escrow totaling approximately $45 million.

Sales in Escrow consist of seven club villas that sold for an average price of $4.5 million, two club bungalows at an average price of $1.75 million, one club cottage at $2.95 million and four custom lots averaging a $1 million each. All of the binding contracts are scheduled to close in 2015 except for one club villa.

In addition to the 11 homes being constructed by members we have 16 developer homes under construction through our various building initiatives.

To further expand the range of our product offerings at Kukui'ula, civil construction of Kukui'ula’s newest neighborhood Kai Lani is progressing well with mass grading of the 26 acre parcel of approximately 80% complete. Kai Lani will consist of 24 custom lots and a planned 20 unit condominium project all with ocean views.

Of the 16 custom lots that were released for presale in this project in June, four were contracted for sale during the quarter and are included in the 14 units we have in Escrow. The positive momentum at Kukui'ula is carrying over to the shops. Our 79,000 square foot resort retail center adjacent to the residential community.

The shop is now 95% leased compared to 86% at this time last year. The tenants at the shops are doing well with NOI increasing more than 13% through June. In March we welcomed yet another great restaurant Eating House 1849 by Chef Roy Yamaguchi, and look forward to the opening of a 15,000 square foot CVS drugstore at the shops in the fourth quarter.

Shifting now to the commercial portfolio, on Slide 16 increases in Hawaii same-store performance and the timing of acquisitions and dispositions drove nearly 16% increase in operating profit and a 9.2% improvement in NOI in the second quarter compared to the second quarter of 2014.

Our Hawaii portfolio is performing well with an increase in same-store NOI of 10.2% driven primarily by our Oahu properties, which reported a same store NOI increase of 11.5%.

These increases reflect not only the high quality of the portfolio, but also our ability to attract new tenants due to the size of the portfolio in the large amount of retail GLA that we own in the state.

We expect the positive performance to continue for the rest of the year and project our full year NOI growth to be approximately 7.9% sorry, let me try that again, growth is going to be about same in the second half, as in the first half roughly around the same 7.9% for the full year as what we experienced in the first half.

Second quarter 2015 occupancy for the Hawaii and Mainland portfolios were 93% and 95% respectively compared to 93% for both portfolios for the second quarter of 2014.

Finally turning to agro business on Slide 17 unfortunately, the weather challenges mentioned in our last call have continued and our sugar production is well behind where we expected to be at this point in the harvest.

Power margins also have been significantly lower than anticipated as the drop in fuel prices has reduced the price the local utilities pays us for power. Our dedicated team on Maui is managing through the challenges well and we hope to recover some of the lost ground against our original production plan.

But with continued unstable weather patterns and about half of the harvest remaining, it would be imprudent to make full year projections at this time. I can’t say that we’re likely to incur an operating loss greater than 2014, but we’ll do our best at limit it.

There is no secret that our Ag earnings are highly variable and between 2010 and 2013 we generated cumulative profits of about $60 million but we’re now in a tougher stretch. We continue to explore ways to improve our sugar results but also are actively looking at different business models including a diversified farm model.

As active as our efforts are, both on the sugar and diversified farm fronts, this is a significant complex undertaking and will take some time. We'll be updating you on our progress in future calls. With that let me turn the call over to George to discuss our materials and constructions results..

Thanks, Chris. Our materials and construction segment reported $7 million of operating profit and $9.7 million of EBITDA or earnings before interest, taxes, depreciation and amortization.

A 13% decline in liquid asphalt pricing implemented at the start of the second quarter negatively impacted our asphalt terminal operation's revenue and profitability as we work through our oldest highest cost inventory.

However by quarter’s end this high cost inventory had been largely depleted and as a result going forward we do not anticipate the type of impact we saw in the second quarter. The segment’s longer term prospects remain very positive.

Grace's backlog grew by 22% from the end of March to $251.4 million at the end of June due to a pick up in the pace of government bid activity. Performance for the balance of the year will largely be dictated by the percentage of this backlog we can complete and by additional perspective business we can win and do this year.

With that I will turn over to Paul Ito to talk about financial matters.

Paul?.

Thank you, George. Slide 21 we compare our balance sheet at the end of the quarter to year end. Proceeds from Waihonua and other development sales allowed us to reduce our debt levels in the first half of the year resulting in a decrease in our debt to debt plus equity ratio from 37% at the end of 2014 to 33% at the end of June.

On Slide 22 of the $37 million in total capital expenditures so far this year, $23 million went to investment capital, the majority of which was for active real estate projects and joint ventures. The remaining $40 million was for maintenance capital.

For the balance of the year, we have a little over $100 million in budgeted investment capital remaining including a $50 million placeholder for commercial property acquisitions, which we anticipate will be funded through 1031 exchanges, the remaining projected expenditures are primarily for investment in ongoing development projects and in undesignated new projects.

As in past years our budget includes capital for opportunistic investments the size and timing of which is of course unpredictable. With that let me turn the call over to Stan for closing remarks..

Thank you, Paul. Real estate performance was strong again this quarter. Sales momentum continues at our key projects and we continue to build our development pipeline. Our commercial portfolio is also performing well bolstered by solid same-store performance.

Because of extremely poor weather conditions, we do not expect to meet our 2015 sugar production goals. In addition power margins have declined because of lower fuel prices. As a result, losses will be higher than we had expected earlier in the year. As Chris mentioned you will be hearing more from us on future calls.

Despite the significant decline in the price at which we sold our asphalt, our materials and construction segment generated $10 million of EBITDA in the second quarter and the significant growth in backlog will benefit future quarters.

Before we open it up for your question let me take a minute to congratulate Chris Benjamin on his promotion to CEO and Lance Parker on his promotion to President of A&B Properties. Most of you know Chris well, and know that he is an intelligent capable leader and driving force behind the company’s strategic direction since joining A&B in 2001.

Chris has served A&B well in a number of executive leadership roles including Chief Financial Officer, General Manager, President of A&B Properties and most recently as A&Bs President and Chief Operating Officer. The Board and I are confident in his ability to lead the company in the years ahead.

You’re not as familiar with Lance but you’re familiar with his work. He is Head of our Properties Acquisition and Disposition team, Lance played a major role in the $1 billion worth of real estate transactions that we've consummated since 2012 including the acquisition of our Kailua and Kukui'ula avenue portfolios.

Lance is an excellent leader and we look forward to introducing him to you over the next several months. As for myself while I'll be stepping away from day to day oversight I will remain actively involved in my role as Executive Chair.

This Company is extremely important to me and I will continue to do all I can to support both our team and the relationships in our community that are important to our success. And that concludes our presentation this afternoon and we would now be happy to answer your questions..

[Operator Instructions] Your first question comes from Sheila McGrath with Evercore. Please proceed..

Good afternoon.

Same store NOI in Hawaii was really strong, I was just wondering if you could give us some insight with that mostly from the Kailua acquisition and maybe tell us how that acquisition is performing versus your original expectations?.

Hi Sheila it's David. Our Kukui'ula portfolio is doing extremely well and the entire retail portfolio is doing quite well with strong same-store growth. Kailua is a significant part of that and we've been very pleased thus far with its performance and continue to look forward to that goal forward..

Okay. And then in the slide deck there was a slide on CapEx and amount that you've invested this year is well below what you budgeted.

I was just wondering is that because you haven’t been able to source acquisitions or should we expect kind of more acquisitions in the back half of the year, just your thoughts on the investment outlook?.

Yes Sheila I think the answer to the first one is yes that probably has to do with just the timing of acquisition activity as you know and as Paul just said we budget without clear knowledge of what we'll be investing and that probably explains the difference so far.

And we certainly have things in the pipeline that could happen this year but we don’t talk specifically about timing or deals until they're consummated, but we certainly hope to be active yet this year..

Okay. And last question the real estate segment both development and the lease portfolio are really strong really all this year with demand accelerating at your major developments and I was just wondering Stan, the stock has continued to underperform this year.

If you could just give us an update on any strategic initiatives that you might consider to kind of close the gap between NAV and share price..

Okay. That's a good question Sheila, let me answer this way. Obviously we have been disappointed in our stock price performance. We haven’t been really announcing any bad news and so there is nothing really I think for the market to act negatively to. But again as far as things that affect our stock price, let me answer it this way.

First of all Hawaii's economy is performing well right, it’s a strong performer, expected to improve, expected to do well over the next several years. I think you see that improving economy, improving real estate markets reflected in our own performance.

So we do expect development sales activity, property sales activity and leasing performance to be a reflection of the improving Hawaii economy. Second, we continue to build our development pipeline. Chris has referred to a few new projects. So the pipeline we continue to build upon actively and something again that will benefit us in future years.

And of course we have a really strong record of investing in quality real estate throughout the State. We’ve been doing after 20 years. We have a great track record and we expect that to continue. Now we’ve been a little bit silent recently.

When markets are good, it is more difficult to find good investments that pencil out because of our underwriting discipline but we expect to continue with our historic track record of making good investments in the state. And then finally there are some strategic opportunities we’re looking.

These of course are going to be far and fewer between, but both real and both in real estate as well on the corporate side there are strategic opportunities and we’re hopeful that we can execute on couple of those over the next year or two.

So there are some near-term things that we are looking at, but at this point I think it would be little premature to be more specific about those right now..

Okay. Thank you..

Stan Kuriyama:.

.:.

Your next question comes from Steve O'Hara with Sidoti & Company. Please proceed..

Hi good morning, I think it is..

Yep..

Hi Steve..

Hi, I guess congratulations first of all I guess certainly for Chris and I guess a little were a bit of sweet for Stan on my part for Stan but congrats..

Thanks..

And then just quarter seemed I guess kind of in line with expectations, I guess one question on the backlog for Grace I mean is the backlog actually a little bit better than maybe it appears, simply because pricing is compressed a little bit because of where oil is or is it more kind of volume based and not really impacted?.

Well I think certainly given the and again Steve this George I apologize I didn’t introduce myself, I think given the fact that there is some lower pricing for some of that commodity inputs to the business such as asphalt in the marketplace that, that has been reflected in the bid volume in the early part of the year.

And so we feel pretty good about the way that will translate for Grace into future work. What’s really going to matter for us as I mentioned in the prepared remarks is the extent to which we can work our way aggressively through that backlog over the remainder of the year, the balance of this year and next year.

And a lot of that becomes either very project dependent or weather dependent. There just still some issues with things like the pace at which notices proceed come out.

There are some -- there was a big series of articles in the Honolulu Star Advertiser a couple of months ago about the challenges that Hawaii has in translating federal funding into state highway projects.

And so those are things that tend to limit the ability to translate that backlog and in addition to backlog other work that we believe is out there in the short-term into short-term financial results, but I’d say overall we feel very, very positive about where we are in this business and we feel very positive about our ability to continue to win and complete as best in the short-term..

Okay. Thank you. And then just I know there’s a couple of or maybe one very large housing project I want to say it’s on the Eastern side of the island in Oahu and I think both are kind of locked up in the Supreme Court or in front of the Supreme Court. It sounds like the housing demand is there. It looks like volume on the condos improves obviously.

Do you have any take on your thoughts about the prospects of these projects getting through and if maybe that would be driver for Grace going forward as well?.

Yeah so Steve let me start and then I’m going to ask Lance to chime in a little bit specifically on those projects you’re referring to. The context I want to start with is the fact that we’re very happy to be playing in a number of the residential markets in Hawaii right now.

We’re heavily involved as you know in the urban condominium market, which has been booming. We’ve got the projects on Maui that I referenced in my remarks both a resort project at Wailea and a primary residential project that is coming up on in Kihei.

And then of course we've got the phenomenal project on Kailua and Kukui'ula and we’ve got a resort property project over on the big island. So we feel very good about the way we’re able to take advantage of the strong residential market in Hawaii right now.

The one piece that we’ve been clear about wanting to add is more Oahu primary residential outside the urban core. And so we have been looking to some of these projects out on actually on the West side West and Central side of the island and would love to participate in some of those.

We having being specific about who we’ve been talking to or what projects we’ve been looking at but suffice it to say we would like to partner with or take down pieces of land in one or more of these projects.

So they are -- couple of the big ones anyway are tied up in litigation and maybe I can just let have Lance comment briefly on where those, the likelihood of them advancing and then what that will mean George can jump in on the Grace part of the question..

Thanks Chris. Hi Steve this is Lance. Probably difficult I think for us to really say the likelihood of these projects and where they stand in regards to litigation. But suffice it to say as Chris indicated there are a handful of larger residential projects on West Oahu.

We’ve expressed our interest in the past in playing in that arena and continue to have a strong interest in doing so. So we’ll track those opportunities. We’ll continue to underwrite them into the extent that we can get involved we will..

And certainly I would just add for Grace that any increase in construction activity on the lye water west side of the island will result in some substantial benefits to Grace simply because of the location of its quarry relative to the other rock quarry of the island or the one that’s the most proximate in location to all of the larger plant developments in Hawaii and so once that get underway we would anticipate some benefit to Grace..

Okay. Thank you..

Your next question comes from Young Ku with Wells Fargo. Please proceed..

Great, thank you. Just going back to Grace for a little bit, if I take a look at your backlog $251 million today versus kind of Q1 '14 which is what was around the same type of level.

So is it fair to say that until that backlog starts increasing you probably won’t be getting incremental EBITDA growth from Grace or am I thinking about that wrong?.

Well there’s really couple of factors that play, it’s not only the size of the backlog, but it’s really the pace at which you go through the backlog because in a throughput driven business like Grace the more tonnage that you can put down, the more rock that you can quarry because of the high fixed cost nature of that business.

The quicker you can do it the more that will translate into EBITDA in any given quarter and so really what I would point you towards is if you look at the margins, the EBITDA margins versus the revenues on a quarterly basis you’ll note that at higher revenue levels we tend to do higher EBITDA margins and so it’s really for us about how much of that work can we get done in a relatively concise period of time and there is another factors that play into that.

But I wouldn’t preclude EBITDA growth at any given level of backlog. I think it’s really what’s determined to is both the level of backlog and the pace at which we can get through it..

Okay, got it. That’s helpful.

And so in terms of the second half 2015 EBITDA contribution, what kind of numbers should we be looking at for the full year '15 do you think it’s going to be something similar to 2014 or maybe there is a little bit growth on top of that?.

We really haven’t commented on a specific estimate for that. I’d say that certainly where the run rate of the past couple of quarters is something that if you look at the revenues, the EBITDA margins are pretty attractive.

And so if we can continue that pace of revenues or increase it modestly then I would say that we would be able to maybe get a little bit better results in the second half.

On the other hand if because of weather and/or other factors, we aren’t able to get through the backlog as quickly, then we will -- we could face some headwinds there and so, a lot of it is going to depend on the pace at which we can get through these things..

Okay, that’s helpful.

Thank you, and just going to back to the strategic alternative question that was published earlier, with your leverage, at pretty level and you stock trading at a pretty steep discount to NAV have you considered stock buyback as opposed to other investment opportunities as a potential option?.

Yeah, hi this is Paul. So, yeah share purchases, obviously is a capital allocation and capital structure decision that are influenced essentially by the other alternative investments that are out there.

So we would certainly consider share purchases in the context of our other investment opportunities and to the extent it represents a superior investment opportunity we would undertake that.

Currently we have a $2 million share repurchase authorization and all of that remains available, but again it comes down to an evaluation of what we have in terms of investment alternatives..

Okay, thank you and just one last question for you and George. When I look at the real estate supplemental for Q2, I just wanted to be clear that I calculating this correctly.

The NOI contribution from Kailua retail and Kailua ground lease, how should I think about that? It’s looks like if I add those two together sequentially it was up pretty meaning to if I like 30%, but I just want to make sure I wasn’t double counting anything..

Hey, Young this is George, I don’t know David Haverly answer that question..

Thanks George. Young you're right, by taking both the Kailua retail pieces in the supplement and the ground lease for Kailua that would be representative of the Kailua acquisition and the NOI growth we received from that.

And you should take into account that a portion of the ground lease increase was reset on that Kailua shopping, work shopping center acquisition that we had earlier this year..

Okay, so that $4.5 million is it a pretty good run rate then..

Actually for the quarter it's a slight increase I will taper off because there were some retroactive ground rent in that..

Oh I see, got it. Thank you..

[Operator Instructions] Your next question comes from Wilkes Graham with Compass Point. Please proceed..

Hi good morning and to Chris and Stan and Lance congrats to you three..

Thanks Wilkes..

Thank you, Wilkes..

Just one question for me I think most of the other question I had have been asked, maybe Chris as you're looking at the residential market in Hawaii as you mentioned you're operating in a e in the condo market and resort market on Kailua, you don’t really operate in the sort of primary residential market on Kailua.

But I am sure you observe those trends. I am curious as we move through this year, if you've seen strength and weakness in any of those three markets relative to the others in demand of pricing power I would say..

I am sorry Wilkes, the three markets compare to which..

To each other, so the condo market very high and reserve market and then the primary residential..

Well I would say that certainly the slowest to recover this time around even though it is back to a degree and it’s covering is the resort market and we've felt that of course with improvement, but not dramatic improvement in resort sales over the last couple of years. So, it’s going the right direction, but at a smaller pace.

The condo market of course has been off the charts of late and then the primary residential market has been very strong, but just isn’t that much supply on the primary residential market.

One of the reasons that we targeted the price points that we did at both Waihonua and the collection, which is very much a local buyer mid level, middle class pricing level is because we see so much depth in that market and we believe that while the higher end stuff is certainly doing well right now it is a somewhat more finite market and we have see tremendous depth going forward for the primary residential market and the price points in say $400,000 to $600,000, $700,000 price range.

There is just a lot more demand at that level. So that’s why we’re very interested in the primary residential market on Oahu because we think there is significant depth to it. Stan do you want say anything..

Okay, thanks a lot..

We have a follow-up question from Steve O'Hara with Sidoti & Company. Please proceed.

Hi, thanks for taking the follow up. Could you just I think in the past you talked about the timing on the collection, I’m just wondering -- I didn't hear you mention, maybe you did, but are you still kind of planning on late 2016, is that still a good timeframe/.

Yeah, Steve we're probably going to be cautious in hedge a little bit. Certainly completion and construction we’re targeting late 2016 as you know you got to complete construction and get a certificate of occupancy and then get through 450 closings.

And so when those exactly will fall whether it will be late 2016 or early 2017 we’re not taking a strong position on right now, but completion on construction should certainly is on track for late 2016..

Okay. Thank you very much..

Thank you.

This ends our Q&A session. I will now turn the call over to Ms. Suzy Hollinger for closing remarks..

Thanks Latoya. I just wanted to mention on the answer to Young's question on the supplement and what you have to add for Kailua for the ground leases you have to also add the other Oahu ground leases NOI, so that you can capture everything. Thanks for been on the call today. If you have any questions, you can call me at 808-525-8422. Thank you..

Ladies and gentlemen, thank you for your participation. This concludes today’s conference. You may now disconnect. Have a great day..