Brendan Maiorana - Senior Vice President of Finance and Investor Relations Edward Fritsch - President and Chief Executive Officer Theodore Klinck - Chief Operating and Investment Officer Mark Mulhern - Chief Financial Officer.

Emmanuel Korchman - Citigroup Jamie Feldman - Bank of America Merrill Lynch Dave Rodgers - Robert W. Baird.

Ladies and gentlemen good morning and welcome to the Highwoods Properties' Conference Call. During the presentation, all participants will be in a listen-only mode. Afterwards, we will conduct a question-and-answer session. [Operator Instructions] As a reminder, this conference is being recorded on today's Wednesday July 26, 2017.

I would now like to turn the conference over to Brendan Maiorana, Senior Vice President, Finance and Investor Relations. Please go ahead sir..

Thank you and good morning. Joining me on the call this morning are Ed Fritsch, President and Chief Executive Officer; Ted Klinck, Chief Operating and Investment Officer and Mark Mulhern, Chief Financial Officer. As is our custom, today's prepared remarks have been posted on the web.

If any of you have not received yesterday's earnings release or supplemental, they are both available on the IR section of our website at highwoods.com. On today's call, our review will include non-GAAP measures such as FFO, NOI and EBITDA.

Also, the release and supplemental include the reconciliation of these non-GAAP measures to the most directly comparable GAAP financial measures.

Before I turn the call to Ed, a quick reminder that any forward-looking statements made during today's call are subject to the risks and uncertainties, and these are discussed at length in our annual and quarterly SEC filings. As you know, actual events and results can differ materially from these forward-looking statements.

The company does not undertake a duty to update any forward-looking statements. I'll now turn the call to Ed..

Thanks Brendan, and good morning everyone. Each quarter we typically start our call with the few brief comments regarding the economy and business conditions. In reviewing my prepared remarks from the past few years, the commentary has been consistently consistent.

Economic growth at around 2% has been positive, albeit below the long-term trend, inflation has been nominal, interest rates have remained low, job growth has been modest and the capital markets have been accommodative for well capitalized companies.

At the risk of sounding like a broken record or a podcast stuck on repeat, the current conditions appear once again in sync with the recent past. While seemingly stuck in the second year, this backdrop has proven to be a positive for our business.

Office absorption has remained net positive, speculative new supply has been held and check and well below past peaks, net effective rents have continued to improve and demand for highly pre-lease development has been healthy. We believe we are well positioned to continue to capitalize on this [indiscernible] macroeconomic environment.

Our portfolio of BBD located office properties continues to garner strong rent growth. Our development projects will continue to strengthen our cash flows and drive value creation and our balance sheet has never been stronger. Other than the length of the cycle, we don’t see any indications that the current economic conditions soon change.

In addition, we believe we are well positioned if and when conditions were to change. Our BBD submarkets are typically the last de-lease in the down market and the first to re-lease in an up market.

Our strong balance sheet provides us with the flexibility to pursue prudent growth opportunities via value add acquisitions and our strong improvement in development programs. Turning to the second quarter, we delivered $0.90 of FFO per share, 10% higher than the same time last year. The quarter included a penny for debt extinguishment gains.

Our strong financial performance was driven by better NOI in our same property pool, accretion from recently delivered development projects and savings from lower average interest rates.

Given our positive results, we have increased the midpoint of our FFO per share outlook by $0.01 after factoring in $0.02 of anticipated dilution from planned dispositions not previously included in our forecast. In summary, we are pleased to deliver steady FFO growth while continuing to recycle out of non-core properties.

On the operational front, we posted strong same property cash NOI growth of positive 5.3%. Cash rent spreads on signed leases were a positive 1% and GAAP rent spreads were a positive 15.3%. This quarter was the fifth consecutive quarter of positive rent spreads, double-digit positive GAAP rent spreads.

Our occupancy was 92.7% at the end of Q2, the same as at the end of the first quarter. An increase in occupancy in our same property pool was offset by placing our unoccupied 131,000 square foot industrial development project in Greensboro.

Behind the scenes, disposition activity was heavy during the quarter and we expect those efforts will translate into closings that will occur in latter part of the year. Therefore we increased the low end of our disposition outlook from $50 million to a $105 million.

The $105 million includes the $13 million sold in the first quarter plus another $92 million of properties that are under contract with non-refundable earnest money deposits. We have additional properties entering the market for sale that could bring the total for the year to the high-end of our guidance of $150 million.

We anticipate dispositions will be dilutive to 2017 FFO by $0.02 per share with the impact primarily coming in the fourth quarter. As a reminder, in keeping with our strategic plan, we routinely evaluate our portfolio for non-core properties and expect to continue to be regularly recyclers of assets.

We have kept our outlook for acquisitions unchanged at zero to $200 million. The acquisitions market is slow. For the few BBD located Class A properties that have come to market, we concluded pricing was out of sync with our view of the risk profile. We continue to evaluate on and off market opportunities with the focus on prudent investment.

Our development program continues to be a core competency of our company. At $225 million of 82% pre-lease development start encompassing 769,000 square feet announced so far this year, we have already exceeded the high end of our original outlook of $220 million.

This $225 million includes $99 million of new projects announced subsequent to the end of the first quarter. In addition, during the second quarter, we placed $208 million of 96% lease development in service and signed a total of 245,000 square feet of first-gen leases.

Our development pipeline now encompasses1.5 million square feet a total investment of $440 million and 76% pre-leased. The largest of our recent development announcements is the $65 million 219,000 square foot third building for MetLife's Global Technology Campus in Raleigh.

This announcement comes less than two years after we delivered their first two buildings. This 50% expansion announcement is a flattering endorsement of the Triangular area and MetLife's confidence in the Highwoods' team.

As part of yesterday's earnings release, we announced Virginia Springs I, a $34 million 109,000 square foot 34% pre-leased office building in the Brentwood submarket a Nashville BBD. Construction is scheduled to commence in the fourth quarter and the building will be built on company owned land which we acquired last year.

Brentwood has vacancy of 7% and there is no office development underway. Our 1.7 million square foot portfolio in Brentwood is 92.6% occupied. And our $107 million 299,000 square foot Riverwood 200 Development project in Atlanta, shell construction is complete and our first customer has moved into second quarter.

We are now 79% pre-leased two years in advance of pro forma stabilization. Shell construction is also complete at Seven Springs II. Our $38 million 135,000 square foot project in Nashville. We increased the pre-leasing percentage to 63% during the quarter and have a number of active prospects.

The stabilization is projected for the third quarter of 2018. We continue to see a pipeline for potential highly pre-lease development projects. While it's always difficult to forecast if and when a sizable user will commit to a development.

We are encouraged by the conversations and level of activity and therefore have increased the high-end of our development announced from $220 million to $275 million. Our average development projects announcements is around $50 million. So the high end of guidance includes the potential for one additional announcement before year end 2017.

Again, development is a core competency for us and an ongoing engine of strengthening cash flow and earnings growth. The combination of strong operating fundamentals, a solid balance sheet and the delivery of well pre-lease development projects sets the table for continued growth over the next several years. Ted..

Thanks, Ed and good morning. We had solid activity this quarter. Fundamentals across our markets remains consistently healthy over the last several quarters.

We continue to see long-term dynamics benefiting our markets, simply stated people enjoyed living and working in the Southeast for population and job growth were routinely above the national average. Raleigh had major employment growth announcements from numerous companies this quarter.

Included in these are more than 1000 expected new hires from both Credit Suisse and Infosys, a new entrant to Raleigh plus MetLife’s planned growth at our campus for them. Nashville has been our highest growth market this cycle. It continues to attract new residence and employers and its existing companies continue to expand their office footprint.

Atlanta, our largest market has garnered many corporate relocations in the organic growth of large corporate users has been strong. With limited new speculative supply and solid growth. The outlook in Atlanta continues to be bright. This past weekend, a New York Times article highlighted Pittsburgh as a growing tech centre.

Demand from leading tech companies such as Google, Uber, Facebook, Amazon and Apple will help drive office absorption across the market. There is also healthy demand from legal, financial and professional services firms as well as corporate users.

The combination of a palpable, urban, affordable cost of living and steady stream of graduates from local universities has Pittsburgh on the map for employer seeking well educated talent. Turning to our stats for the quarter. Total portfolio occupancy held steady from Q1 at 92.7% and office only occupancy increased 50 basis points to 92.9%.

As Ed noted, rents continue to move up and this was a fifth consecutive quarter with both positive cash rent spreads and double-digit positive GAAP rent growth.

Further, are in place cash rents per square foot are up 2.6% from the prior year even with Bridgestone’s 500,000 square feet where we are not receiving cash rent as this lease is still under early possession GAAP rent recognition.

We leased 575,000 square feet of second-gen office space in an average term of 6.1 years this quarter, and year-over-year asking rents continue to move higher. TI’s are generally moving up with escalating constructions cost, but we have been mostly successful in recouping these costs with higher rents.

Over the last four years, average net effective rents on second-gen office leases signed have increased approximately 25%. Turning to our operational performance in the quarter, we grew same property cash NOI by 5.3% over the prior year. We attribute this to higher average occupancy and in place rents, plus lower operating expenses.

We expect NOI growth will moderate in the second half of 2017 due to timing and seasonality of operating expenses and the previously disclosed move outs. Overall, we are pleased we were able to increase our same property NOI growth outlook again this quarter.

Our updated outlook is 3.0% to 3.75% growth which we view as positive considering average occupancy in the same property pool is projected to be modestly lower year-over-year. We ended the quarter with 92.7% occupancy and our year-end outlook remains unchanged at 92.2% to 93.2%.

I’ll first start with a brief update on our work to backfill of the larger 2017 move outs we have previously disclosed. In Nashville, at the end of Q1 we had re-let 37% of the former 210,000 square foot HCA space. We are now at 44% and have strong prospects that would take us above our year end goal of 50% re-let.

In Richmond, we mentioned last quarter that we already re-leased 39% of the 163,000 square feet and FCI scheduled to vacate through third quarter. We moved the re-let percentage to up to 64% at the end of the second quarter and we have prospects for approximately half of the remaining space. We feel good about the level of interest we are seeing.

In Atlanta, as previously disclosed, we will get back to 136,000 square feet in two blocks in the third quarter. These move outs are heavily driven by customer M&A activity. The positive are the blended in place rents are approximately 10% below market and there aren’t a lot of large blocks of Class A space available in the Buckhead.

Sticking with Atlanta, we continue to generate strong rents as evidenced by GAAP rent spreads of positive 30.5% on signed deals in Q2. The positive backdrop of fundamentals and the quality of the blocks of space we will soon have available combined to make us confident will drive NOI upward as occupancy normalizes.

We have seen the most year-over-year improvement in our Tampa portfolio, where occupancy is up 420 basis points. Our occupancy is 93.1% and activity remains healthy. We signed 96,000 square feet of second-gen leases in the quarter with GAAP rent growth of 19%. According to JOL, asking rents in Tampa were up 3.8% over the last 12 months.

At Suntrust Financial Center were now 89.7% occupied, up from 77% when we acquired it less than two years ago. With no new speculative office construction and healthy demand from diverse prepaid users, we expect solid fundamentals to continue. In Raleigh, the market continues to show steady growth.

Per Avison Young, Class A rents were up 5% year-over-year and vacancy is down 140 basis points to 9.0%. Our portfolio is 93.3% occupied up from 91.9% a year ago. We have been watchful of the new supply, which is now 2.1 million square feet or 4.5% of the market.

At 38% pre-leased and spread across numerous submarkets in Raleigh and Durham, we believe the level of supply is meeting market demand. Less than 1 million square feet of this supply is competitive to our BBD located office portfolio. Finally in Nashville, leasing activity and rents remain strong.

Per Cushman Wakefield, market vacancy is 6.9% and 6% for Class A properties. Class A asking rents were up 10% year-over-year. New supply is 2.5 million square feet or 6.7% of inventory which is approximately 60% pre-leased. New supply levels are down from the peak in 2016 and net absorption was robust in Q2 at 667,000 square feet.

The market steady demand suggest the remainder of this new product will be appropriately absorbed. Our portfolio occupancy is 95.7%, up 150 basis points from Q1 and we posted solid GAAP rent spreads of 15% in Q2. In conclusion, the positive fundamentals across our markets are for a healthy backdrop for our business.

Solid demand for our well located BBD office product should support strong organic NOI growth going forward. Mark..

Thanks Ted. During the quarter, we delivered net income of $37.6 million or $0.37 per share a 16% increase year-over-year and FFO of $94.5 million or $0.90 per share, a 10%increase year-over-year. Rolling forward from the $0.80 per share of FFO we delivered in Q1. The increase in Q2 was driven by the following items.

NOI from our customers early possession of Bridgestone Americas headquarters up $0.04 per share. Debt extinguishment gains of a penny per share, the normalization in G&A that equated to $0.02 per share.

As you know, our first quarter G&A is customarily higher due to the routine expensing of equity incentive cost under our long standing retirement plan. Sequential improvement in same property NOI of $0.02 per share much of this improvement is driven by seasonality that we usually see in Q2.

And as Ed noted, there are also other lower than anticipated operating expenses in the quarter. And finally lower interest expense of a penny per share. These items make up a $0.10 increase in FFO. Turning to our balance sheet and financing activities. We ended the quarter with leverage of 35.3% and debt-to-EBITDA of 4.56 turns.

Importantly, while we are committed to grow on a leverage neutral basis over the long-term, we are able to fund the remaining 271 million of spending on our development pipeline without the new issuance of new equity and still maintain a debt-to-EBITDA around the midpoint of our stated comfort range of 4.5 to 5.5 times.

We had several important financing transactions this quarter. The first is a new $100 million secured loan with a 12 year term that carries a 4% interest rate. These proceeds were used to payout a $108 million maturing secured loan with an effective interest rate of 4.2%.

This refinancing extends out our maturity ladder at a competitive fixed rate while further driving our unencumbered NOI to a record level for us at 96%.

Second, we entered into a floating to fixed interest rate swaps through January 2022 with respect to an aggregate of 50 million of LIBOR based borrowings, which effectively fixes the one month LIBOR at a weighted average rate of 1.69%.

Third as I mentioned on our last call, we obtained 150 million of forward starting swaps that effectively lock the underlying 10 year treasury at 2.44% with respect to a forecast to debt issuance before May 15th of next year.

As Ed mentioned, we updated our FFO outlook to $3.33 to $3.38 per share, a penny increase from the previous midpoint of $3.345 per share. As noted in our earnings release, this increase incorporated anticipated dilution from planned dispositions, we forecast will close for the remainder of 2017.

Most of this dilution will affect our fourth quarter results. When factoring in this $0.02 of estimated dilution, our apples-to-apples FFO outlook is up $0.03 per share at the midpoint. While these dispositions are dilutive to FFO, we don't expect they will alter our trajectory of strengthening cash flows in 2017 and beyond.

It’s worth considering a few modern items for the second half of 2017 and going forward. Our same property cash NOI growth is expected to moderate in Q3 and Q4 due to the timing and seasonality of operating expenses and the back half of the year impact of the known vacancies that we have discussed.

Other income is projected to drop due to the non-recurring debt extinguishment gains realized in Q2 that are not forecasted to repeat in the second half. Higher interest expense due to lower capitalized interest and higher share count. With that, operator we are now ready for your questions..

[Operator Instructions]. Our first question comes from the line of Manie Korchman. Please go ahead..

Hey, good morning everyone. So given the positive remarks you had about both sort of Nashville and Pittsburgh.

If we were to push you really hard and say what is going to be the next market that you go into sort of the way you did Nashville? What would that be then?.

So a new market for us or new dollars would more likely be invested..

Sure both..

So the answer on the first with regard to new markets, we look at markets as you know that aren't gateway cities. So we are not interested and trying to elbow our way into New York or LA as example. So we like to be kind of the big dog on a medium sized porch in the mid-tier cities.

We also have cities that have demographics that outperform national averages and we have seen that in our current footprints. So we would look for cities that mimic having demographics that outperform national averages. And then proximity to our current footprint makes a lot of sense.

So let's say that Portland has really good demographics, it's not a gateway city, but geography it doesn't make sense to us.

So we have routinely looked in markets that basically go from DC over to Texas and that leaves you with about half a dozen or more markets in that footprint that we routinely look at for a right opportunities to enter as we found in Pittsburgh what we haven't found. Pricing or assets are scaled to be in alignment yet with our investment objectives.

And then with regard to just dollars invested going forward it would predominantly be in this part of the cycle on the development side given the acquisitions is pretty quite right now and we are looking at a good handful of additional developments in addition to what we have in our current development pipeline, but it’s very difficult to tell what may or may not come to fruition on the build the seek side, but I can tell you that of the handful that we are pursuing across is five different markets for us..

Great.

And then if we think about the move outs that are coming in the latter half of this year, how much capital do you think you will have to put into those spaces to get them re-leased?.

I think probably the biggest disproportion amount Manie would be and I know this is reaching into next year would be the [FBI] (Ph), because we have a heavy dose of prioritizing that we need to do them.

We get that space back in February of 2018, but as far as the HCA space and the FCI space, we have already invested dollars in both of the HCA buildings which was divided one 33, 22 and the other ramp parts are those improvements have been - the common area of advertising improvements have been complete.

And then the TI dollars will just be in sync with market. There is no unusual aspects of that or at FCI in Richmond..

Great. Thanks Ed..

You are welcome..

Our next question comes from the line of Jamie Feldman with Bank of America Merill Lynch. Please go ahead..

Thank you good morning. I guess just taking with some of the Atlanta vacancy to come, can you maybe just talk about asking rent then specific leasing pipelines or tenant interest breaking out a few Buckhead spaces so then also from the FBI.

This is how we should be thinking about timing and what that demand line was like today?.

Sure Jamie this is Ted. First in Buckhead, you know I think our asking rents in Buckhead in those buildings you know generally mid-30s, which is about 20% below the three alliance building new construction that’s got delivered. So we are signing deals in that range today.

We feel like the market - there is nothing else under construction so we think the market in a lot of new big box and are available in the markets. So we feel pretty good about leasing that up, just a reminder we get about half the space back at the end of this month and about half at the end of August.

And we have already had numerous showing on the space, so I think we are going to lease that up in due time. With regard to the FBI, they vacate February 1st of 2018, we are already starting to show that as well and seen a lot of activity including a strong prospect for about 18% of the space.

So we feel real good about leasing that up in fair amount of time as well..

And then with regard to your question about where it stands in markets are combined the two tranches that will get back in Buckhead are about 10% below market and the FBI space is basically equal to market today..

Okay, and FBI was that something you would break up?.

Absolutely. Good question Jamie, because you would normally think that it’s a field office so it would be a single customer building, but they actually occupied a 136,500 square feet of a 228,000 square foot building. So it is a multi-customer building today, so yes we would absolutely lease by for.

And in fact we have a good prospect for A floor at this juncture..

Okay, great thanks. And you didn't talk about Orlando, can you just update us on what you have going on there, is that market you want to stay in longer term? Just latest thoughts..

Sure, yes. So it's a core market for us no doubt. Our investment in Lincoln Plaza, we have a site downtown that we have schematic drawings for a what we can do up to 300,000 square foot build a suite right across from our Cap Plaza I and II with integrated structured parking.

You may remember we brought DLF out of number of years ago and we think that the basis in which we bought that 1.3 million square feet very attractive. And Orlando has been slower to come back after the recession, but we are certainly seeing that market show some positive signs. And keen to what we have experienced in Tampa.

The Raleigh, Nashville, Atlanta came back quicker, and Tampa was slow to do it, but now Tampa is I think as Ted said in his comments is probably one of our hottest leasing markets right now and we are hopeful that Orlando is not far behind that..

Okay. And then just last question is I think you had mentioned five potential buildings since you are working on.

Is that on Highwoods' land and what does that mean for yield?.

All but one are on Highwoods' land. And the yield what we have said in the past is we don't like to speak anything specific, because in the competition those were according from project-to-project, but we consistently averaged 8 plus on a GAAP return for our development projects..

Okay, all right. Thank you..

Thanks Jamie..

Our next question comes from the line of Dave Rodgers with Baird. Please go ahead..

Hey, good morning guys. Mark, maybe to just start with you on Bridgestone. With the contribution in the second quarter or full quarter contribution I guess other way to asking that.

Is there any incremental contribution in the third quarter?.

Yes. Those are full contribution in second quarter, and we'll see similar number in Q3..

And I assume the big break line rent has the Bridgestone addition. I guess maybe as we roll forward over the next quarter two or three and into 2018.

Can you talk about kind of what break line rent adjustment would look like both with the asset sales or maybe you are looking at or maybe some older higher CapEx sales as well as the Bridgestone roll off and roll on to cash rent?.

Yes, so Dave the Bridgestone lease obviously will convert to cash in 2018 here. So that straight line rent will decline, again it was about $4 million a quarter in Q2 and Q3. The dispositions will be dilutive to FFO as we have noted in the release. But from a cash flow perspective not really impacting any of that.

And so that should be positive again from a net cash flow basis and going forward..

Okay, that's helpful. And maybe for Ed or Ted, I think year-end occupancy guidance is right below 93% at the midpoint. Do you feel that there is still room to push occupancy here in the cycle over the next couple of years? Or are we getting to that point of kind of frictional vacancy rate within the portfolio.

Just curious on your thought on that?.

Yes, I think it's fair to consider equilibrium in the current environment around 93.5%. And obviously us placing in service 131,000 square foot warehouse in Greensboro that unleashed has an impact on where we might by the end of the year..

Okay, that’s helpful and just given the strength of the office markets where you are and any thoughts on moving forward with more speculative development on the office side, like you have done on the industrial like you talked about and talk about any activity that you might have on the industrial building you just mentioned. So sorry two more..

Sure. So this is spec development, we did announce in yesterday’s release Virginia Springs I which is 34% pre-leased building so there is obviously a spec component to that.

So prior to that we had announced a 751 corporate centre in Raleigh, again about a third pre-leased and then before that we had announced 5000 CentreGreen that was a pure spec building.

So I think we have done it in a very cadence manner and we will continue to look at those opportunities and we look across how much do we have that’s build to suit a 100% pre-lease versus how much spec we want to take on. So we look on it, didn’t look that it’s not just by market but in the aggregate across the portfolio.

I think the cadence in which we have done that would be a fair way to consider how we would continue to do it in the future.

The second part of your question with regard to the building we are referencing is Enterprise 5, it could be confusing because we also recently announced Enterprise 4 and they are both about the same size, about 130,000 square feet.

Enterprise 4 we announced 63% pre-leased, Enterprise 5 which we started year before we started spec and it’s still as I mentioned un-leased, but we feel very good about it.

In enterprise part we have 660,000 square feet that’s 96.7% occupied and in Greensboro we have 2.4 million square feet, that’s 95.8% and the market itself is a 114 million square feet, that’s 95.5% occupied. So when you across whether it’s ours in a park or in the market or the market as a whole, the occupancy is 95 plus percent.

So we just haven’t met the right customer yet and the total investment is only $7.6 million. So we are not losing any sleep over that one yet..

Make sense, all right. Thanks guys..

Thanks Dave..

[Operator Instructions]. Our next question is a follow-up question coming from the line of Manie Korchman with Citi. Please go ahead..

Just a follow-up. The operating expense savings in 2Q, can you sort of discuss what they were and how they differ from the ones in 1Q and I was under the impression they are sort of more deferred in nature and will actually be recognized 3Q or 4Q. So maybe just some details on that..

Yes, Manie its Mark. What I would say is obviously the second quarter is milder weather so our utility numbers were a little modest on a comparative basis. We had some property tax savings that we were able to get through the property tax appeal process.

So I would say those were the primary drivers of maybe the decline and what we are cautious about is we did have some repair and maintenance expending that we think will shift into the third and fourth quarter.

So we do anticipate again a moderating of that same store NOI number as you go into Q3 and Q4 you know we are coming off of two quarters of 5% plus growth in cash NOI. And you see we did with the guidance. So yes, we do anticipate a combination of a little higher OpEx and then some of the impact of the vacancies impacting those numbers..

Thanks Mark..

Sure..

Our next question is a follow-up question coming from the line of Jamie Feldman with Bank of America Merrill Lynch. Please go ahead..

Hey I'm just curious to hear your latest thoughts on how much remaining to raise the dividend based on the developments in the pipeline and cash flow growth?.

So Jamie, as you know we kind a make a periodic evaluation of the dividend. We have got a lot of good things happening with respect to putting as you noted the developments in service and the cash flow improving overtime. So I do think that the CAD numbers and certainly the free cash flow will strengthen overtime.

And we will get in make that decision and discuss it with the board obviously make some evaluation, but it's still little early for that. We are just coming off of 3.5% increase that we made in Q4, 2016. So I think we'll get to that, but I wouldn't tell you what that is right now..

Okay. Thanks for the color..

Sure..

There are no further questions on the phone lines at this time. I'll turn the conference back to you..

Thank you everyone for dialing in and thank you for the questions. As always, if you have any follow up questions, don't hesitate to give us a call. Thank you..

Ladies and gentlemen that does conclude the conference call for today. We thank you for your participation and ask that you please disconnect your lines..