CONE
#<UNK>, if there's any of those peers that think they can't make money, we're more than happy to pay them a commission to float all of those deals to us and we will be willing to do those deals all day long.
Just sending that out there.
We're happy to pay anyone a commission to bring more of those deals to us.
The reality is, we have been designing and focusing on the design of our facilities and our supply chain for the last half decade.
The result is that we can consistently deliver these types of yields that we have been putting up for the last several years.
I hear a lot of that chatter in the industry.
I don't know where it comes from, but all I can say is I would personally he happy to take all of the deals in the industry if the other guys can't walk away.
I think you probably saw a lot of that when Walmart was first starting out their company and you had a lot of these mom and pop stores going out of business.
Basically because of the logistical and supply-chain efficiency that Walmart was able to bring into that industry, which was fairly sleepy for a number of years.
And they shook it up and now we see the same thing going on with Amazon.
Being just as disruptive in that same type of industry.
I think the results and the proof is in the pudding.
They stand on their own.
With regard to the EBITDAR numbers, I think you could do a similar type of thing.
My only caution there is some of the expense in the EBITDA number as opposed to the NOI number is somewhat forward-looking.
When I think of your NOI number, that is really a static type number relative to those buildings that you have in place.
If you look at what we are doing in the G&A line, there is really where you get a much better sense for the investments that we're making in the business to where we are going to be over the next couple of years.
I talked about what we've been doing on the customer service side.
We are beefing up our legal team, finance team, marketing, sales, those are all forward-looking investments that we're making, given where we want to be over the next couple of years.
If I had no intention to want to grow this business, and want to do something on a broader scale we would not be making any of those types of G&A investments in the Company.
We have always taken the position that we never want to lead with price.
We have always felt that as long as we can make a really nice return on the capital that we are deploying, we're happy to continue to do that.
And so, if there's irrational decisions being taken by other folks in the industry, we will have to think through that.
But the reality is that we are maniacally obsessed with continuing to pull out cost and how to do things faster and cheaper.
That is what we do all the time.
And so when I think about the competitive landscape, the whole focus is how do I continue to push the envelope and do things differently and more creatively.
And so we really from an innovative perspective, that is where we make our money.
I talked about, when we first started the Company, a long time ago, we've always went into this from the perspective of we always wanted to be the low-cost provider in the industry.
That was purely done on a defensive basis.
Because we never had a cost to capital advantage to play around on the right-hand side of our balance sheet.
So I never wanted to be in a position where I had an inferior position on what I could actually deliver the cost of the product to be only worsened by the fact that I have an inferior cost of capital position.
Our cost of capital position has improved dramatically over this period of time.
We have always had the high ground, in terms of being able to deliver a megawatt of capacity at the lowest cost.
We're going to continue to sell what we have.
And hopefully, some of these other folks that can't meet the current prices out there will self select out.
And we can continue to gobble up a bigger share of the market.
But we don't see any reason why you have to drop your price to be able to do that.
No.
Nothing like that in these leases.
The only thing I would say is that the lease bumps on these when they're going out for 12 years or less the typical what we have been seeing is lease increases of between 2.5% to 3%.
And these are less than that just given the life of these is much longer duration.
Closer to that range.
Maybe a little less at times.
Thanks everyone.
I appreciate you joining our call today.
As I mentioned, this is the strongest position CyrusOne has ever been in.
We feel really bullish about the prospects in front of us.
But I would also point out that the entire industry continues to do really well.
We are the last one to report our results this quarter.
And again, all of my peers also put up really strong results for the quarter.
I think it bodes well for the industry heading into 2017 and beyond.
