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SL Green (SLG) Announces Deal for Manhattan's News Building

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SL Green Realty Corp. (SLG - Free Report) announced the execution of a deal to convey a 30-year leasehold condominium interest, covering 308,115-square-foot at the News Building in Manhattan, NY, to Visiting Nurse Service of New York.

Notably, Visiting Nurse Service of New York is relocating from 1250 Broadway to this 220 East 42nd Street property. This property will serve as the centralized headquarters during its 125th Anniversary year. Notably, the 30-year deal comprises portion of the second, whole of third, fifth and sixth, part of the seventh, as well as portion of the ground and concourse level.

This deal, along with the prior announced renewal of 231,114-square-foot with Omnicom, considerably alleviates the forthcoming Omnicom lease expiration, spanning 493,560 square-foot of space and is hence encouraging for SL Green.  

This 220 East 42nd Street is a landmark building that towers 37 stories above midtown Manhattan. Among its major tenants are Omnicom Group, Martin Clearwater & Bell, WPIX TV, U.N. Women and United Nations. The property enjoys decent demand from tenants due to its proximity to major public transportation.

As a matter of fact, SL Green is the leading commercial property owner in New York City. The company has been actively pursuing portfolio enhancement initiatives through investments in opportunistic assets and debt and preferred equities. However, stiff competition and interest rate issues pose concerns.

SL Green currently has a Zacks Rank #3 (Hold).

Investors can also consider some better-ranked stocks in the REIT industry like American Tower Corporation (AMT - Free Report) , CorEnergy Infrastructure Trust, Inc. (CORR - Free Report) and InfraREIT, Inc. (HIFR - Free Report) , all sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

American Tower is a steady performer, having beaten the Zacks Consensus Estimate over all the trailing four quarters, with an average surprise of 6.16%. CorEnergy Infrastructure has experienced 3.9% upward revision in full-year 2016 estimates in the past two months. Also, InfraREIT has a long-term expected growth rate of 10% against the industry average of 5.8%.

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