Bringing them up to market "won't happen overnight," heacknowledged, but the situation demonstrates significant upsidepotential. He estimated that net operating income could increase by$50 million as rents are lifted to market rates.
When a Wall Street analyst questioned the timeline on existingleases, Olson said some anchor options are in place for as long as15 to 20 years, "but the probability of all going to full term isunlikely," which is why the 2007 guidance calls for 3% to 4% netoperating income property growth.
New and renewed leases during the first quarter numbered 180 foran aggregate of 604,000 sf at an average increase of 9.4% on a cashbasis. The average base rent of the full portfolio is $11.14 persf, according to Jeffrey Stauffer, COO, which is 4.5% more than thefirst prior-year quarter.
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