SL Green Realty (SLG - Free Report) announced an agreement to sell 1745 Broadway, which is an office building in Manhattan. The company, together with its joint venture partner Ivanhoe Cambridge, will sell the property for $633 million or $939 per square foot.
The transaction is subject to customary closing conditions and will likely close by second-quarter 2018. SL Green will be selling the property to an institutional customer of Invesco Real Estate.
Located in the center of the Midtown West, about three blocks from Central Park and Columbus Circle, this building is a Class-A property, spanning 674,000 square feet. Currently, the entire block between 55th and 56th Streets is taken up by the building which is 100% leased.
Additionally, the company has contracted to dispose of two suburban office properties, 115-117 Stevens Avenue in Valhalla, NY and Reckson Executive Park in Rye Brook, NY for a total of $67 million. The sale of these properties is initiated to different buyers and is subject to customary closing conditions.
Notably, 115-117 Stevens, which is expected to be sold by the second quarter of this year, has two office buildings, covering 178,000 square feet. Reckson Executive Park spans across 540,000 square feet and has six Class-A office buildings. The sale of the same is likely to be completed by the third quarter of 2018.
Together the deals are anticipated to generate approximately $190 million proceeds for SL Green, which it plans to use towards the $1.5 billion stock-repurchase program. Out of which, the company has already repurchased 12,258,203 shares.
SL Green’s co-chief investment officer, Isaac Zion informed, “We continue to make strategic divestments of non-core assets to both support the stock repurchase program and strengthen our portfolio.”
Encouragingly, in the past six months, shares of this Zacks Rank #2 (Buy) stock have outperformed the industry. While the company’s shares have declined 6.5%, the industry has recorded a loss of 9.1% during this period.
Stocks Worth a Look
A few other top-ranked stocks from the same space include Arbor Realty Trust (ABR - Free Report) , Extra Space Storage Inc. (EXR - Free Report) and Sotherly Hotels Inc. (SOHO - Free Report) . All three stocks carry a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Arbor Realty Trust’s Zacks Consensus Estimate for 2018 FFO per share remained unchanged at 90 cents over the past month. Its shares have returned 10.2% in 12 months.
Extra Space Storage’s FFO per share estimates for the current year moved up 0.9% to $4.59 in a month’s time. Its shares have gained 16.6% over the past 12 months.
Sotherly Hotels’ FFO per share estimates for 2018 remained unchanged at $1.05 over the past month. The stock has gained 23.3% during the past 12 months.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
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