SL Green Realty (SLG) Q3 2024 earnings summary

Executive summary

• Achieved a major 925,000 sq ft renewal and expansion lease with Bloomberg at 919 Third Avenue, contributing to year-to-date leasing of 2.8 million sq ft and a projected 92.5% Manhattan occupancy by year-end.

• One Madison Avenue is fully complete and operational, with IBM and other tenants moving in, and new amenities opening soon.

• Signed 42 Manhattan office leases totaling 763,755 sq ft in Q3 2024, with mark-to-market rents 10.8% higher than previous rents.

• The company operates as a self-managed REIT with 36 properties totaling 25.3M sq ft and 89.4% occupancy as of September 30, 2024.

• The company has returned to the DPE business, investing nearly $110 million in the quarter and preparing to launch a debt fund with an anchor investor.

Financial highlights

• Q3 2024 total revenues were $229.7 million, up 9.2% year-over-year; rental revenue rose 3.9% to $156.9 million.

• Net loss attributable to common stockholders was $13.3 million, or $(0.21) per share, improved from $(0.38) per share in Q3 2023.

• Funds from Operations (FFO) for Q3 2024 was $78.6 million ($1.13 per share), down from $87.7 million ($1.27 per share) in Q3 2023.

• Cash, cash equivalents, and restricted cash totaled $315.1 million at quarter-end; liquidity including undrawn revolver was $0.7 billion.

• Same-store cash NOI increased 2.9% in Q3 2024 year-over-year, trending ahead of expectations for 2024.

Outlook and guidance

• Leasing momentum is expected to continue, with projected year-end Manhattan occupancy at 92.5%.

• Full-year same-store guidance remains unchanged, but performance is trending better than expected.

• No significant move-outs or right-sizing anticipated for Q4 2024 or early 2025; renewals are outpacing expectations.

• Management expects to meet liquidity needs through operating cash flow, asset sales, and available credit.

• Income recognition from new leases will ramp up over 2025 and beyond due to typical build-out delays.