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SL Green Realty Corp. SLG reported third-quarter 2025 funds from operations (FFO) per share of $1.58, which beat the Zacks Consensus Estimate of $1.34. The company reported an FFO of $1.13 per share in the year-ago period.
The results reflect a strong leasing activity with improved average rental rates on the Manhattan office leases signed in this period. From the beginning of the year through Oct. 15, 2025, the company has signed leases aggregating around 1.9 million square feet with a current pipeline of more than 1 million square feet.
Net rental revenues of $149.7 million marginally surpassed the Zacks Consensus Estimate of $149.6 million. Moreover, the figure improved 7.2% year over year.
In October 2025, SLG entered into a contract to acquire a Class A office building, Park Avenue Tower at 65 East 55th Street for $730 million. The transaction is set to complete in the first quarter of 2026, subject to customary closing conditions.
In the third quarter, for its Manhattan portfolio, SL Green signed 52 office leases encompassing 0.7 million square feet of space. The average rental rate on the Manhattan office leases signed was $92.81 per rentable square foot, improving from $90.03 in the previous quarter.
The signed leases had an average lease term of 8.9 years. The average tenant concessions were 9.1 months of free rent with a tenant improvement allowance of $99.09 per rentable square foot. The mark-to-market on signed Manhattan office leases decreased 2.7% from the previous fully escalated rents on the same spaces in the quarter.
Same-store cash net operating income (“NOI”), including the company's share of same-store cash NOI from unconsolidated joint ventures, decreased 5.5% year over year to $161 million, excluding lease termination income.
As of Sept. 30, 2025, Manhattan’s same-store office occupancy, including 361,924 square feet of leases signed but not yet commenced, was 92.4%, up from 91.5% at the end of the prior quarter.
SL Green's interest expenses (net of interest income) increased 12.2% from the year-ago quarter to $47.2 million.
In September 2025, SL Green closed on the sale of 5% stake in One Vanderbilt Avenue to Mori Building Co., Japan’s leading urban landscape developer, for $86.6 million. The sale follows an 11% stake sale in November 2024. Post this transaction, SLG’s stake in the trophy office tower is maintained at 55%.
In August 2025, SL Green entered into a contract to acquire 346 Madison Avenue, along with the adjacent site at 11 East 44th Street, for $160 million. Subject to customary closing conditions, the deal is expected to close in the fourth quarter of this year.
SL Green exited the third quarter with cash and cash equivalents of $187 million, up from $182.9 million recorded as of June 30, 2025.
As of the same date, the net carrying value of the company’s debt and preferred equity portfolio was $289.7 million, down from $315.7 million as of the last quarter.
SL Green currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
SL Green Realty Corporation price-consensus-eps-surprise-chart | SL Green Realty Corporation Quote
We now look forward to the earnings releases of other REITs like Digital Realty Trust DLR and Welltower WELL, slated to report on Oct. 23 and Oct. 27, respectively.
The Zacks Consensus Estimate for DLR’s third-quarter 2025 FFO per share is pegged at $1.78, implying a 6.6% year-over-year increase. DLR currently carries a Zacks Rank #2.
The Zacks Consensus Estimate for WELL’s third-quarter 2025 FFO per share is pegged at $1.29, indicating a 16.2% year-over-year increase. WELL currently carries a Zacks Rank #2.
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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This article originally published on Zacks Investment Research (zacks.com).
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