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SL Green's Q1 FFO & Revenue Beat Estimates, Rental Rates Improve
SLGSL Green(SLG) ZACKS·2025-04-17 15:31

Core Insights - SL Green Realty Corp. reported first-quarter 2025 funds from operations (FFO) per share of 1.40,exceedingtheZacksConsensusEstimateof1.40, exceeding the Zacks Consensus Estimate of 1.27, compared to 3.07pershareinthesameperiodlastyear[1]−TheresultsweredrivenbyimprovedaveragerentalratesonManhattanofficeleasesandhighersame−storecashnetoperatingincome(NOI),despiteelevatedinterestexpensesimpactingoverallperformance[2]FinancialPerformance−Netrentalrevenuesreached3.07 per share in the same period last year [1] - The results were driven by improved average rental rates on Manhattan office leases and higher same-store cash net operating income (NOI), despite elevated interest expenses impacting overall performance [2] Financial Performance - Net rental revenues reached 144.5 million, surpassing the Zacks Consensus Estimate of 140.7million,reflectinga12.7140.7 million, reflecting a 12.7% year-over-year increase [2] - Same-store cash NOI increased by 2.4% year over year to 149.2 million, excluding lease termination income [3] Leasing Activity - In the first quarter, SL Green signed 45 office leases totaling 0.6 million square feet in Manhattan, with an average rental rate of 83.75perrentablesquarefoot,upfrom83.75 per rentable square foot, up from 74.38 in the previous quarter [4] - The average lease term for signed leases was 9.8 years, with tenant concessions averaging 9.4 months of free rent and a tenant improvement allowance of 94.35perrentablesquarefoot[5]OccupancyandInterestExpenses−AsofMarch31,2025,Manhattan′ssame−storeofficeoccupancywas91.894.35 per rentable square foot [5] Occupancy and Interest Expenses - As of March 31, 2025, Manhattan's same-store office occupancy was 91.8%, down from 92.4% at the end of the previous quarter [6] - Interest expenses increased by 46.5% year over year to 45.7 million [6] Portfolio Activity - In April 2025, SL Green sold 85 Fifth Avenue, generating net proceeds of 3.2million,andinthefirstquarter,soldsixGiorgioArmaniResidencesfornetproceedsof3.2 million, and in the first quarter, sold six Giorgio Armani Residences for net proceeds of 93.3 million [7] - The company acquired 500 Park Avenue for 130millioninJanuary2025[7]LiquidityPosition−Attheendofthefirstquarter,SLGreenhadcashandcashequivalentsof130 million in January 2025 [7] Liquidity Position - At the end of the first quarter, SL Green had cash and cash equivalents of 180.1 million, a decrease from 184.3millionasofDecember31,2024[8]−Thenetcarryingvalueofthecompany′sdebtandpreferredequityportfoliowas184.3 million as of December 31, 2024 [8] - The net carrying value of the company's debt and preferred equity portfolio was 318.2 million, reflecting a 4.8% increase from the last quarter [8]