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Shares of SL Green Realty Corp. (SLG - Free Report) lost 3.26% in the after-market trading hours after it reported a fall in occupancy in its Manhattan’s same-store office portfolio.
While the company’s second-quarter 2023 funds from operations (FFO) per share of $1.43 surpassed the Zacks Consensus Estimate of $1.33, the figure fell from the year-ago quarter’s $1.87.
Net rental revenues of $165.65 million missed the Zacks Consensus Estimate by 0.12%. However, it climbed 21.4% from the prior-year quarter’s $136.49 million.
Quarter in Detail
During the second quarter, the same-store cash NOI, including SL Green’s share of same-store cash NOI from unconsolidated joint ventures, increased 3.6% year over year to $160.8 million. This excludes the lease termination income.
For its Manhattan portfolio, SL Green signed 43 office leases encompassing 410,749 square feet of space in the reported quarter. The mark-to-market on signed Manhattan office leases decreased 2.2% from the previous fully-escalated rents on the same spaces for the quarter.
The average lease term for the Manhattan office leases signed was 8.3 years, while average tenant concessions were 9.2 months of free rent with a tenant improvement allowance of $81.33 per rentable square foot. This excludes the leases signed at One Vanderbilt Avenue.
As of Jun 30, 2023, Manhattan’s same-store office occupancy, inclusive of 143,263 square feet of leases signed but not yet commenced, was 89.8%, down from 90.2% at the end of the prior quarter and 92.6% at the end of the year-ago quarter.
As of the same date, the carrying value of the company’s debt and preferred equity portfolio was $636.5 million.
Liquidity
SL Green exited the second quarter with cash and cash equivalents of $191.9 million, up from $158.9 million recorded as of Mar 31, 2023.
Investment Activity
In June, SLG divested 49.9% of its joint venture interest in 245 Park Avenue for a gross asset valuation of $2 billion. The transaction yielded $174.2 million as net cash proceeds for the company. With 50.1% interest remaining in the property, SLG will continue to oversee the management and leasing aspects of the same.
We now look forward to the earnings releases of other REITs like Alexandria Real Estate Equities, Inc. (ARE - Free Report) and American Tower (AMT - Free Report) , slated to report on Jul 24 and Jul 27, respectively. Boston Properties’ (BXP - Free Report) earnings are scheduled for Aug 1.
The Zacks Consensus Estimate for Alexandria’s second-quarter 2023 FFO per share is pegged at $2.20, implying a year-over-year increase of 4.8%. ARE currently carries a Zacks Rank #3.
The Zacks Consensus Estimate for American Tower’s second-quarter 2023 FFO per share is pegged at $2.34, suggesting a year-over-year fall of 9.6%. AMT currently carries a Zacks Rank #3.
The Zacks Consensus Estimate for Boston Properties’ quarterly FFO per share stands at $1.80, indicating a year-over-year fall of 7.2%. BXP currently has a Zacks Rank #3.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
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SL Green's (SLG) Q2 FFO Beats Estimates, Occupancy Falls
Shares of SL Green Realty Corp. (SLG - Free Report) lost 3.26% in the after-market trading hours after it reported a fall in occupancy in its Manhattan’s same-store office portfolio.
While the company’s second-quarter 2023 funds from operations (FFO) per share of $1.43 surpassed the Zacks Consensus Estimate of $1.33, the figure fell from the year-ago quarter’s $1.87.
Net rental revenues of $165.65 million missed the Zacks Consensus Estimate by 0.12%. However, it climbed 21.4% from the prior-year quarter’s $136.49 million.
Quarter in Detail
During the second quarter, the same-store cash NOI, including SL Green’s share of same-store cash NOI from unconsolidated joint ventures, increased 3.6% year over year to $160.8 million. This excludes the lease termination income.
For its Manhattan portfolio, SL Green signed 43 office leases encompassing 410,749 square feet of space in the reported quarter. The mark-to-market on signed Manhattan office leases decreased 2.2% from the previous fully-escalated rents on the same spaces for the quarter.
The average lease term for the Manhattan office leases signed was 8.3 years, while average tenant concessions were 9.2 months of free rent with a tenant improvement allowance of $81.33 per rentable square foot. This excludes the leases signed at One Vanderbilt Avenue.
As of Jun 30, 2023, Manhattan’s same-store office occupancy, inclusive of 143,263 square feet of leases signed but not yet commenced, was 89.8%, down from 90.2% at the end of the prior quarter and 92.6% at the end of the year-ago quarter.
As of the same date, the carrying value of the company’s debt and preferred equity portfolio was $636.5 million.
Liquidity
SL Green exited the second quarter with cash and cash equivalents of $191.9 million, up from $158.9 million recorded as of Mar 31, 2023.
Investment Activity
In June, SLG divested 49.9% of its joint venture interest in 245 Park Avenue for a gross asset valuation of $2 billion. The transaction yielded $174.2 million as net cash proceeds for the company. With 50.1% interest remaining in the property, SLG will continue to oversee the management and leasing aspects of the same.
SL Green currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
SL Green Realty Corporation Price, Consensus and EPS Surprise
SL Green Realty Corporation price-consensus-eps-surprise-chart | SL Green Realty Corporation Quote
Upcoming Earnings Releases
We now look forward to the earnings releases of other REITs like Alexandria Real Estate Equities, Inc. (ARE - Free Report) and American Tower (AMT - Free Report) , slated to report on Jul 24 and Jul 27, respectively. Boston Properties’ (BXP - Free Report) earnings are scheduled for Aug 1.
The Zacks Consensus Estimate for Alexandria’s second-quarter 2023 FFO per share is pegged at $2.20, implying a year-over-year increase of 4.8%. ARE currently carries a Zacks Rank #3.
The Zacks Consensus Estimate for American Tower’s second-quarter 2023 FFO per share is pegged at $2.34, suggesting a year-over-year fall of 9.6%. AMT currently carries a Zacks Rank #3.
The Zacks Consensus Estimate for Boston Properties’ quarterly FFO per share stands at $1.80, indicating a year-over-year fall of 7.2%. BXP currently has a Zacks Rank #3.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.