Newmark Q3 2025 Earnings Call Transcript

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Date

Thursday, October 30, 2025 at 10 a.m. ET

Call participants

Chief Executive Officer — Barry Gosin

Chief Financial Officer — Mike Rispoli

Head of Investor Relations — Jason McGruder

Global Head, Occupier Solutions — Luis Alvarado

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Takeaways

Total revenues -- $863.5 million for Q3 2025, representing a 25.9% increase compared with $685.9 million in the prior year quarter, driven by double-digit growth in all major business lines (non-GAAP).

Management services, servicing, and other revenue -- Grew 12.6% (non-GAAP) in Q3 2025, including 23.5% growth in valuation and advisory (non-GAAP), marking the best-ever quarter for these recurring revenue businesses on a non-GAAP basis.

Leasing revenues -- Rose 13.7% (non-GAAP) in Q3 2025 as a result of increased office and industrial activity in New York, Texas, and Northern California, reaching a record for the third quarter.

Capital markets revenues -- Surged 59.7% in capital markets revenues for Q3 2025 (non-GAAP), attributable to an approximately 129% increase in total debt volumes and a 67% jump in investment sales volumes, with both metrics meaningfully outpacing industry benchmarks.

Total expenses -- Total expenses were up 24.9% compared with the prior year quarter, primarily reflecting a 32.9% rise in commission-based revenues (non-GAAP), higher pass-through costs, and ongoing investments in business growth.

Adjusted earnings per share (EPS) -- Increased 27.3% to $0.42 from $0.33.

Adjusted EBITDA -- Adjusted EBITDA was $145.2 million, up 28.9% compared with the prior year quarter, with the adjusted EBITDA margin improving by 40 basis points to 16.8%.

Adjusted EBITDA margin (YTD) -- Improved 116 basis points to 15.2% (non-GAAP) for the first nine months of 2025.

Adjusted free cash flow -- Adjusted free cash flow reached $291.9 million over the trailing twelve months, up 134% compared with the prior year.

Cash and net leverage -- Ended the quarter with $224.1 million in cash and cash equivalents, and one times net leverage.

Share count -- Fully diluted weighted average share count declined 1.3% to 251.7 million.

2025 guidance: Total revenues -- Updated range of $3.175 billion to $3.325 billion, implying an 18.5% increase at the midpoint.

2025 guidance: Adjusted EPS -- Projected at $1.53 to $1.63, representing 24%-33% growth in adjusted EPS (non-GAAP).

2025 guidance: Adjusted EBITDA -- Expected adjusted EBITDA at $543 million to $579 million, indicating 22%-30% growth in adjusted EBITDA (non-GAAP) and an approximate 100 basis point adjusted EBITDA margin expansion at the midpoint.

Tax rate -- Adjusted earnings tax rate was 12.1% for the quarter and 13.2% year to date, with full-year guidance revised to 13%-15%.

International expansion -- Nine new international offices opened, and over 100 revenue-generating professionals hired outside the US since early last year, including expansions in France, Germany, the UK, Singapore, India, South Korea, and the UAE.

Acquisition of RealFoundations -- Completed this month, broadening client service capabilities through consulting and managed services for institutional real estate owners, and supporting the new fund administration business.

Facility management launch -- Newly launched in India and the broader APAC region this week.

Recurring revenue goal -- Management reconfirmed its goal of achieving $2 billion in annual recurring revenues by 2029.

2026 targets -- Management reaffirmed adjusted EBITDA (non-GAAP) target of over $630 million for 2026 and adjusted EPS target of $1.75 per share, noting formal 2026 guidance will be updated on the next call.

Summary

Management described the revenue growth as entirely organic for the quarter, and reported that all major business lines experienced double-digit increases (non-GAAP), with capital markets performance significantly outpacing industry averages in both debt and investment sales. Recent acquisitions and international expansion were presented as central to Newmark Group (NASDAQ:NMRK)’s strategy, including the RealFoundations acquisition and the rollout of property and facility management services in APAC, both framed as bolstering global and recurring revenue streams. Leadership maintained that investments in talent and geographic growth are expected to "result in 10% earnings improvement next year," referring to non-GAAP earnings, according to Mike Rispoli, while asserting continued margin expansion alongside these investments. Management acknowledged that current growth investments dampen near-term adjusted EBITDA margin expansion, but clearly stated that, without these investments, "it could have been double EBITDA expansion." The outlook anticipates strong pipeline momentum heading into year-end and does not indicate near-term macro or political obstacles slowing business activities.

Barry Gosin stated, "Newmark's growth was entirely organic," emphasizing performance drivers were internal, not acquisition-based.

The company highlighted that recurring businesses, such as management services and valuation, achieved record performance.

Mike Rispoli indicated future investments are "very purposeful," and modeled to drive 10% earnings improvement next year.

Management identified infrastructure–focused capital flows, particularly in data centers, as ongoing sources of client demand and opportunity.

Barry Gosin described the company as having "one of the most comprehensive sets of investor solutions to drive value for owners of commercial real estate and debt funds," following recent business launches and hiring initiatives.

Industry glossary

Adjusted EBITDA: Earnings before interest, taxes, depreciation, and amortization, adjusted to exclude certain non-recurring or non-cash items as defined by the company.

Adjusted EPS: Earnings per share calculated on an adjusted (non-GAAP) basis, typically excluding items such as restructuring costs, amortization, or one-time gains/losses.

Commission-based revenues: Revenue streams that primarily originate from commissions on leasing, sales, or debt transactions, as opposed to recurring fees or non-transaction activities.

Fund administration: Third-party management and accounting of investment funds, including reporting, compliance, and investor services tailored for institutional real estate owners or managers.

Valuation and advisory: Services involving formal appraisals, asset valuations, and consultative guidance on commercial real estate assets, often for lending, transactions, or tax purposes.

Full Conference Call Transcript

Jason McGruder: Thank you, operator, and good morning. Newmark Group, Inc. issued its third quarter 2025 financial results press release this morning. Unless otherwise stated, the results provided on today's call compare only the three months ending September 30, 2025, with a year earlier period. Except as otherwise stated, we will be referring to our results only on a non-GAAP basis including the terms adjusted earnings and adjusted EBITDA. Unless otherwise stated, any figures discussed today with respect to cash flow from operations refer to net cash provided by operating activities, excluding the impact of GSE FHA loan origination and sales.

We may also use the term cash generated by the business, which is the same operating cash flow measure before the impact of cash used for employee loans. Please refer to today's press release, the supplemental tables, and quarter results presentation on our website for complete updated definitions of any non-GAAP terms, reconciliation of these items to the corresponding GAAP results, and how, when, and why management uses them. For additional information on our cash flow measures, as well as relevant industry or economic statistics. The outlook discussed today assumes no material acquisitions or meaningful changes in our stock price. Our expectations are subject to change based on various macroeconomic, social, political, and other factors.

None of our targets or goals beyond 2025 should be considered formal guidance. Also, I remind you that information on this call contains forward-looking statements, including, without limitation, statements concerning our economic outlook and business. Such statements are subject to risks and uncertainties, which could cause our actual results to differ from expectations. Except as required by law, we undertake no obligation to update any forward-looking statements. For a complete discussion of the risks and other factors that may impact these forward-looking statements, see our SEC filings including but not limited to, the risk factors and disclosures regarding forward-looking information in our most recent SEC filings, which are incorporated by reference.

I'm now happy to turn the call over to our host, and chief executive officer, Barry Gosin.

Barry Gosin: Good morning, and thank you for joining us. Newmark Group, Inc. again delivered strong quarterly top and bottom line improvements. Our record third quarter revenues included double-digit gains across every major business line. Newmark's growth was entirely organic. Earlier this month, we acquired RealFoundations which offers management consulting and outsourced managed services for institutional real estate clients across the US, Europe, and Asia Pacific. We also recently launched a fund administration business. Newmark now has one of the most comprehensive sets of investor solutions to drive value for owners of commercial real estate and debt funds. Coupled with our best-in-class talent and client relationships, we believe Newmark is poised for growth across all of our investor and occupier-focused businesses.

With respect to our international expansion, this week, we launched property and facility management services in India, and the APAC region. Since the beginning of last year, we have opened nine international offices and hired over 100 revenue-generating professionals based outside the US. This includes expansions in France, Germany, the UK, Singapore, India, South Korea, as well as the UAE. Newmark's client-centric approach, expanding global reach, and our commitment to remaining agile, accountable, and adaptable is resulting in seeing and winning more global occupier assignments. We are becoming the brand of choice. This gives us increased confidence in our stated goal of producing more than $2 billion of recurring revenues annually by 2029.

With that, I'm happy to turn the call over to our CFO, Mike Rispoli.

Mike Rispoli: Thank you, Barry, and good morning. I'm pleased to report that for the fifth consecutive quarter, Newmark Group, Inc. produced double-digit revenue and earnings growth. Total revenues were $863.5 million, up 25.9% compared with $685.9 million. We increased management services, servicing, and other, by 12.6% leading to the company's best-ever quarter for these recurring businesses. This included 23.5% growth from valuation and advisory. In addition, our high-margin servicing and asset management platform grew by over 12% when excluding the impact of lower interest rates on escrow earnings. Leasing revenues were up 13.7% resulting in a record third quarter for this service line.

This was led by strong activity in New York, Texas, and Northern California, where we generated growth in office and industrial. Capital markets revenues increased by 59.7% which reflected an approximately 129% improvement in our total debt volumes, nearly 2.5 times faster than the industry. We increased our investment sales volumes by 67% also significantly outpacing the industry. Turning to expenses, total expenses were up by 24.9% which reflected a 32.9% increase in our commission-based revenues, higher pass-through costs, as well as investments in growth. We are more confident than ever in meeting or exceeding our 2026 targets of generating record earnings of over $630 million in adjusted EBITDA and $1.75 per share of adjusted EPS.

With respect to taxes, the company's tax rate for adjusted earnings was 12.1% in the quarter, and 13.2% year to date. The lower rate was primarily driven by higher tax-deductible stock compensation. We have therefore adjusted our full-year range to 13% to 15%. Moving to earnings, we increased adjusted EPS by 27.3% to $0.42 compared with $0.33. Adjusted EBITDA was $145.2 million, up 28.9% versus $112.6 million. Our adjusted EBITDA margin on total revenues improved by 40 basis points to 16.8%. For the first nine months of 2025, this margin improved by approximately 116 basis points to 15.2% compared with a year earlier.

With respect to share count, our fully diluted weighted average share count was down 1.3% to 251.7 million. Turning to the balance sheet, we ended the quarter with $224.1 million of cash and cash equivalents, and one times net leverage. The balance sheet changes from year-end 2024 reflected cash generated by the business of $325.5 million and $75 million of incremental borrowing under Newmark's revolving credit facility. This was offset by $177.3 million of cash used mainly to hire revenue-generating professionals, $125.5 million of share repurchases, and normal seasonal movements in working capital. Newmark continues to generate significant cash flow. Our adjusted free cash flow for the trailing twelve months was up 134% to $291.9 million.

Moving to guidance, our updated outlook for 2025 is as follows. We now expect total revenues of between $3.175 billion and $3.325 billion, an increase of 18.5% at the midpoint. We anticipate adjusted EPS between $1.53 and $1.63, up 24% to 33%. And we anticipate adjusted EBITDA in the range of $543 million to $579 million, an increase of 22% to 30% and an EBITDA margin improvement of approximately 100 basis points at the midpoint of the range. With that, I would now like to open the call for questions.

Operator: Thank you. If you would like to ask a question, you may signal by pressing star one on your telephone keypad. If you're using a speakerphone, please. We'll take our first question from Alexander Goldfarb with Piper Sandler.

Alexander Goldfarb: Hey, morning, morning down there. Barry, I have two questions. The first question is on data centers. It's been a topic we've discussed before with you guys, and certainly, it just seems to show no slowdown in investor and capital enthusiasm. As your team looks at the amount of capital that's been committed, versus the ability to actually build data centers over the next, you know, foreseeable future. Do you think all the capital can be put to work in the next, whatever, five, ten years? Or is there a lot more capital raised versus the physical ability to actually build data centers?

Barry Gosin: America is a big place. There is quite a bit of land, and there's quite a bit of gas. And there's an effort long term to build nuclear, both micro and large-scale nuclear. We were just involved in a company going public building a nuclear plant in Texas. We did a, you know, we're involved in a series C, and then they were taken public. And we'll see a lot more of that. I mean, on the exit, there'll be a lot of that. In respect of some of these hyperscalers figuring a way to exit and raise more capital. I mean, there is an endless amount of interest in data centers.

I mean, we produce about three gigs a year, I think. I believe that's a number. You know, I've seen people and estimates as high as 100 to 200 gigawatts of power. So the country is gonna require an enormous amount of infrastructure, so it's not just data centers. It's infrastructure. And infrastructure meaning nuclear plants and power plants and pipelines and data centers and quantum computing and a host of other things that surround it and support it on the industrial side of the business. So generally, I mean, if you look at the GDP, the GDP was primarily the investment in this kind of infrastructure. So I think and I think it has a lot of traction.

And again, as I said before, probably three quarters ago, if you believe in AI, you'll believe in the future. And so there is runway.

Alexander Goldfarb: But do you think it's, I mean, but the point is it sounds like there's, we all know there's a lot out there of potential needs, but it just sounds like physically, building the infrastructure, laying the utilities, building the power plants, all this stuff. It sounds like the capital has gotten ahead of itself. Do you think that's the case, or you think that the capital raised can commensurately, you know, basically go into production, you know, pretty quickly?

Barry Gosin: Well, there is a lot of production going on, but there will be a lot more. I mean, the capital comes first. We're on the capital side, so that's good for us. Raising the capital bill is good for us. I mean, just look at the numbers. And then the predict there's gonna be a lot more capital required. I mean, on the end, when it's built, we'll be there with financing and going public and doing all those kinds of things. So we're following the continuum. We'll be a beneficiary of the future. But we're also right there in the beginning.

Alexander Goldfarb: Okay. And then the second question is, years ago, when you were investing in hiring a lot of different producers and expanding into new areas, acquiring smaller shops, there was a lot of drag initially from those hires. You spent the money to onboard them. It took a while for them to deliver. Recently, that seems to be a thing of the past, and you guys have been expanding into Europe. You mentioned the expansion in India, etcetera. Is all of that, you know, drag that we experienced years ago when you were onboarding producers, is that just a thing of the past, or has the company gotten big enough, or is it where the stock price is today?

Just trying to understand because it's a pretty sharp contrast now as you grow and expand, it doesn't seem to have a slowdown to earnings whereas years ago, it did.

Mike Rispoli: Good morning, Al. So it's Mike. I'll take that one. Of course, it still has a drag on earnings. We're gonna grow nicely this year and expand our EBITDA margins by 100 basis points. Had we not been investing for the future, it could have been double EBITDA expansion. What I would say is the investments we're making today, which are very purposeful and you could see we've accelerated as we move throughout this year, are going to result in 10% earnings improvement next year. And so that is our model. We're very intentional about it. And we can grow margin while expanding the business. And continuing to invest and we'll continue to do that.

Barry Gosin: I mean, we are going to continue to grow the company, Alex. And there is still running room. There's still white space. And we are still putting all the pieces together to build a complete foundation. We are now winning more and seeing more, like I just said. What does that mean? That means we're just gonna have more market share on the things that we have now put all the pieces together in whatever spectrum of activities that are required in that vertical. And once we're there, we pitch the business. We will have a higher ratio of win rates and our volume will go up without any capital requirements.

And that you could see in some of our businesses, it's more apparent because we've already built it. It's happening. We're winning market share. So there's other verticals that we're working on. Not to mention all of the recurring revenue businesses that are around the hoop and supporting all of the other businesses that we've created. Thank you.

Operator: We'll take our next question from Jade Rahmani with KBW.

Jade Rahmani: Thank you very much. The 2026 targets that Mike reiterated, when were those conceived?

Mike Rispoli: Morning, Jade. We've had those targets out there for a while as you know. Certainly, we'll get through the fourth quarter. And we'll give formal guidance for 2026 probably on our next earnings call.

Barry Gosin: But we feel very confident and that's still double-digit growth from the midpoint of our guidance range this year. So we'll certainly reevaluate that next quarter.

Jade Rahmani: Jay, it was a couple of years ago. We've been, you just look back at the earnings calls. We've predicted that for a while.

Jade Rahmani: Yes. Well, what I'm trying to imply or suggest is that since they were created prior to the very robust growth that Newmark Group, Inc. has demonstrated across its businesses, particularly capital markets, plus the data center fundraising wave in which Newmark is taking part, you know, the outlook 2026 as previously mentioned, seems quite conservative. Growth coming out of Siri recoveries tends to be a lot stronger than that. And the recovery thus far, macro risks notwithstanding, seems to be gaining momentum. So do you believe that those targets are conservative? And are you also seeing anything in the macro economy that would cause you to be erring on this side of caution?

Mike Rispoli: I would say it's always good to be a little cautious. Certainly, those are conservative targets. And you know, we'll give you an update next quarter once we get through the full year. Thank you very much. Great job.

Operator: We'll take our next question from Julien Blouin with Goldman Sachs.

Julien Blouin: Hi. Thank you for the question, and congrats on the strong quarter. Barry, I wanted to ask about New York City. I mean, third quarter CRE transactions and leasing in the city looked really strong. But we continue to hear, you know, signs from, signs that institutional investors, especially abroad, are maybe beginning to worry about political risk in the city. Related to the mayoral race. I guess, are you seeing any sign of impact or any cautiousness from buyers in the city?

Barry Gosin: Not really. I mean, there's a lot of noise around the mayor. But as I said, probably two calls ago, the mayor has limited power. The governor's race, the governor really is the firewall for the city. That's really, and the federal government on what, you know, what the federal, how the federal government's gonna treat New York, but that's New York State as well as New York. So I don't really, I believe it's, you know, it's just a lot of noise. New York is, the law firms are doing great. The financial institutions are all expanding. All of our clients are expanding. So I don't really see it.

Julien Blouin: Got it. That's helpful. And then, Mike, can you help us understand maybe the cadence of capital markets across the quarter? Was September particularly strong given rates coming down? And did you see sort of a follow-through of that activity into October? And then maybe how do pipelines compare to this time last year?

Mike Rispoli: I wouldn't say there was anything in particular within months that would stand out to me. It was a strong quarter across the board for us. The pipelines remain really strong into the fourth quarter. You could see that in our guidance. And you know, we feel pretty good. We don't see anything in the market that is slowing transaction activity down at the moment.

Julien Blouin: Okay. Great. Thank you.

Operator: As a reminder, if you'd like to ask a question, please signal by pressing star 1. We'll go next to Mitch Germain with Citizens Bank.

Mitch Germain: Thank you, and congrats on the quarter. I'm just maybe on the RealFoundation transaction, Barry, just maybe talk about kind of your view of the fit and potential to expand or cross-sell that platform?

Barry Gosin: So we've been, we look at ourselves as a pure play for the most part. We are designing a business to be able to be a partner with institutional investors to help them execute on their strategy. And that means all things for them to help them leverage companies like us to be able to do more. And what RealFoundations is, is both a consulting firm and a technology adviser. They implement and integrate, for example, MRI and Yardi, which are the two biggest technology platforms for investors and how they manage. They can go in and advise a company on which tech, how to integrate it, and how to get the maximum out of it.

Now that's a piece of all the other things that we've done, real estate property accounting, staffing, due diligence, cost monitoring. So all those pieces fit neatly together and bridge the gaps between a holistic solution as a becoming the go-to firm when a fund is thinking about how they wanna operate. And some would prefer to operate with, you know, everything in-house, and some prefer to operate with some of this outsourced. We, you know, we hire great people. We've bought great companies. You know, our strategy is about centers of excellence and people who are excellent.

And if we continue to hire the kind of talent that our clients rely on, we think we'll be, you know, be the go-to brand for that kind of business. And we think that has enormous traction. We launched fund administration as well. And without RealFoundations, it would've been much harder for us to deliver on fund administration. So we put the pieces together very carefully. We thought about it, and we think we now have an incredible array of services to provide a very comprehensive solution.

Luis Alvarado: Great. That's super helpful. And Mitch, oh, yeah. If I can.

Barry Gosin: No. This is, this is Lou Alvarado. If I can add, sorry about that, Lou. I'm sorry about that. My thoughts. The other value that we saw in RealFoundations is to augment our growth and occupier solutions. Right? So they were primarily investing focused, but we saw a lot of the skills that they have and the talent that they bring really blends well with our occupier platform as well. As we have significantly grown that and continue to focus on growing that, we think RealFoundations will be an excellent match for us. And that was part of the reason why RealFoundations also picked us.

Mitch Germain: Great. Thanks for that perspective. Barry, obviously, you've been making a lot of hires outside the US opening new offices. Curious about your views about organically growing services platform facilities management and other services versus more traditional brokerage and, you know, kinda how you view that organic growth and the timeline to augment those capabilities on a global scale.

Barry Gosin: Well, you know, it's accelerating. We have, we've been putting all the pieces together the same way we're doing, we did on the investor side. We're doing it the same way on the facility management and the solutions side. Lou is absolutely right. I mean, when, you know, we have clients on the occupier side who use the same technology and to be able to help them implement a technology strategy to manage their real estate better will give us a leg up on the competition. We need to be in the geographies. We need to be in all the verticals. And we need to be out there. I think that our reception in Europe has been incredible.

The same, you know, the talented people wanna be with us. And they're joining the firm because of how we approach the business. They said agile, accountable, nimble. We provide customized solutions. It's easier for us to provide customized solutions for clients. And not just a black box. We're not overly pregnant in certain areas. It gives us the ability to be adaptable for our clients. So all the things are coming together. And as we continue to put in, you know, hit a geography and have that geography when we, you know, we're invited to many more parties.

Mitch Germain: Thank you.

Operator: Thank you. We'll take a follow-up question from Jade Rahmani with KBW.

Jade Rahmani: I just wanted to ask if there's anything in the fourth quarter 2024 comp period that you wanna call out, for example, you know, leasing commissions were up 15.1%. So that's a tougher comp than what you dealt with this quarter. You know, capital markets, of course, was very strong last year. But given the strength this quarter, you know, it seems achievable to exceed that. And then anything on the, you know, expense side, just so we're aware.

Mike Rispoli: Sure. I think generally Q4 is going to be a tougher comp for us. We were up 17% last year. In 24% in the fourth quarter. But that's all been thought through and reflected in the guidance that we provided both in terms of top line and bottom line. The pipeline continues to remain strong and really just comes down to when do transactions close. And as you know, there's always some that are gonna push out, some that are gonna pull in. And we thought through that as we gave you the guidance range that we put out today.

Operator: Thank you. We'll take a follow-up question from Julien Blouin with Goldman Sachs.

Julien Blouin: Thank you. Just a quick follow-up. Barry, you know, following on from Alex's question on data centers, your data center capital markets volumes have been really impressive this year. Particularly on the financing side. You just maybe talk through the team you've built there? How you've been able to build such a dominant early foothold in the space, and then how should we think about the growth in data center financing volumes and investment sales going forward?

Barry Gosin: You know, it's what's interesting, a couple of years ago, we brought in experts in our evaluation group that it's risk assessment and stress testing for banks. The idea is to be early. And early as often as you can. We saw signs of the, you know, the data center business. We acted quickly. That goes into the definition of nimble. We hired people quickly. And we got in front of it. And we have incredibly good people that can, you know, can adapt as well. So we put together an incredible team of people and we're still building it, actually. You know, we're building more on the leasing side of it.

And because there's still, you're still gonna have, you know, cloud computing. You're gonna still have some of the old colocation facilities. That are gonna change out their racking systems. To have better cooling and more capability for the new AI chip set. That provide much more heat and much higher level of computing. You know, there is a whole business of adapting some of the old colocation facilities for the new environment. And, you know, we'll be involved in that kind of stuff. So we still continue to hire good people. It's just all about talent. In all of our verticals, it's about getting the right people in the right place. And not overcrowding.

Julien Blouin: Thank you.

Operator: Thank you. We'll take a follow-up question from Alexander Goldfarb with Piper Sandler.

Alexander Goldfarb: Hey, thank you. And Barry, wanna continue that. A while back, if my recollection is right, when you and I discussed this, there was the comparison to life science and how you didn't wanna overcommit from an investment to data centers just given that real estate tends to follow boom-bust cycles. Doesn't mean it's out. It just means, hey. There's a big boom, and then there's a cooling, and then it grows from there. Obviously, life science, you know, went crazy during COVID, and, you know, now it's dealing with the consequences.

So from a staffing level, are you now feeling more bullish that this has longer legs to hire more or you're still of that restraint mentality, which is, hey. We don't wanna get too far over our skis on this. It's a great sector, but you know, every sector that has huge growth eventually has a cooling period and we just wanna maintain staffing appropriately.

Barry Gosin: You know, we're always, we always view doing more with less. That's just our operating model. If you have great people, you can flex up and down when you get overly committed on anything, you know, it's hard to go the other way. So we think we're appropriately staffed to scale now. We think there are parts of it that we could expand in the geographies more on the probably more on the leasing side of the data center business. But money is fungible. It travels everywhere. We can do it with our team and flexing our team the way it is. Our strategy is more with less, not more.

Alexander Goldfarb: Thank you.

Operator: Thank you. With no additional questions in queue at this time, I'd like to turn the call back over to Barry Gosin for any additional or closing remarks.

Barry Gosin: Once again, I'd like to thank everybody for joining, and I look forward to updating you next quarter.

Operator: That will conclude today's call. We appreciate your participation.

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