Empire State Realty Trust, Inc 8-K, filed Feb 20, 2024
Empire State Realty Trust, Inc. (ESRT)
About this 8-K
Empire State Realty Trust, Inc filed this 8-K on February 20, 2024.
Items reported
- Item 2.02: Financial results
- Item 7.01: Regulation FD disclosure
- Item 9.01: Financial statements and exhibits
| (State or other Jurisdiction of Incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification No.) |
| (State or other Jurisdiction of Incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification No.) |
| rd Streetth Floor |
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(Address of Principal Executive Offices) |
(Zip Code) | |||
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered | ||
Empire State Realty Trust, Inc. |
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Empire State Realty OP, L.P. |
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Item 2.02. |
Results of Operations and Financial Condition. |
Item 7.01. |
Regulation FD Disclosure |
Item 9.01. |
Financial Statements and Exhibits. |
Exhibit No. |
Description | |
| 99.1 | Press Release announcing financial results for the fourth quarter 2023 | |
| 99.2 | Supplemental report | |
| 104 | CoverPage Interactive File (the cover page tags are embedded within the Inline XBRL document). | |
| EMPIRE STATE REALTY TRUST, INC. (Registrant) | ||||||
| Date: February 20, 2024 | By: | /s/ Stephen V. Horn | ||||
| Name: | Stephen V. Horn | |||||
| Title: | Executive Vice President, Chief Financial Officer & Chief Accounting Officer | |||||
| . |
EMPIRE STATE REALTY OP, L.P. (Registrant) | |||||
| By: | Empire State Realty Trust, Inc., as general partner | |||||
| Date: February 20, 2024 | By: | /s/ Stephen V. Horn | ||||
| Name: | Stephen V. Horn | |||||
| Title: | Executive Vice President, Chief Financial Officer & Chief Accounting Officer | |||||
Exhibit 99.1
EMPIRE STATE REALTY TRUST ANNOUNCES FOURTH QUARTER
AND FULL YEAR 2023 RESULTS
– Net Income Per Fully Diluted Share of $0.06 in Fourth Quarter and $0.30 in 2023 –
– Core FFO Per Fully Diluted Share of $0.25 in Fourth Quarter and $0.93 in 2023 –
– Signed 951,000 Rentable Square Feet of Leases in 2023 –
– $1.2 Billion of Liquidity, No Floating Rate Debt Exposure –
– Provides 2024 Outlook –
New York, New York, February 20, 2024 – Empire State Realty Trust, Inc. (NYSE: ESRT) is a NYC-focused REIT that owns and operates a portfolio of modernized, amenitized, and well-located office, retail, and multifamily assets. The Company is a recognized leader in energy efficiency and indoor environmental quality. ESRT’s flagship Empire State Building – the “World’s Most Famous Building” – includes its Observatory, the #1 attraction in the U.S. in Tripadvisor’s Travelers’ Choice Awards: Best of the Best for two consecutive years. Today the Company reported its operational and financial results for the fourth quarter and full year 2023 and provided guidance for the full year 2024. All per share amounts are on a fully diluted basis, where applicable.
Fourth Quarter and Full Year 2023 Recent Highlights
| • | Net Income of $0.06 per share in the fourth quarter of 2023 and $0.30 per share in 2023. |
| • | Core Funds From Operations (“Core FFO”) of $0.25 per share in the fourth quarter of 2023 and $0.93 per share in 2023. |
| • | Same-Store Property Cash Net Operating Income (“NOI”) increased 11.3% from the fourth quarter of 2022 and increased 2.2% from the full year 2022, excluding lease termination fees, primarily driven by higher revenues from cash rent commencement and other income, which was partially offset by increases in property operating expenses. |
| • | Manhattan office portfolio leased rate increased by 20bps sequentially and increased by 250bps year-over-year to 92.1%. Total commercial portfolio is 90.6% leased as of December 31, 2023. |
| • | Signed approximately 164,000 rentable square feet of new, renewal, and expansion leases, in the fourth quarter and 951,000 rentable square feet of new, renewal and expansion leases in 2023. |
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| • | Empire State Building Observatory generated $26.9 million of NOI in the fourth quarter and $94.1 million of NOI for the full year 2023, which is in-line with full year 2019 NOI. |
Property Operations
As of December 31, 2023, the Company’s property portfolio contained 8.6 million rentable square feet of office space, 0.7 million rentable square feet of retail space and 727 residential units, which were occupied and leased as shown below.
| December 31, 2023 |
September 30, 2023 |
December 31, 2022 |
||||||||||
| Percent occupied: |
||||||||||||
| Total commercial portfolio |
86.3 | % | 87.0 | % | 85.2 | % | ||||||
| Total office |
86.0 | % | 86.7 | % | 85.1 | % | ||||||
| Manhattan office |
87.3 | % | 87.8 | % | 86.0 | % | ||||||
| GNYMA office1 |
76.6 | % | 79.3 | % | 80.2 | % | ||||||
| Total retail2 |
90.4 | % | 90.4 | % | 86.5 | % | ||||||
| Percent leased (includes signed leases not commenced): |
||||||||||||
| Total commercial portfolio |
90.6 | % | 90.5 | % | 88.6 | % | ||||||
| Total office |
90.5 | % | 90.5 | % | 88.3 | % | ||||||
| Manhattan office |
92.1 | % | 91.9 | % | 89.6 | % | ||||||
| GNYMA office1 |
79.3 | % | 79.9 | % | 80.9 | % | ||||||
| Total retail2 |
92.1 | % | 91.5 | % | 92.2 | % | ||||||
| Total multifamily portfolio |
98.1 | % | 97.1 | % | 96.3 | % | ||||||
| 1 | “GNYMA office” for the periods ended December 31, 2023 and September 30, 2023 reflects the removal of 500 Mamaroneck, Harrison, NY. |
| 2 | “Total retail” for the period ended December 31, 2022 includes the Westport, CT retail assets which were sold in February 2023. |
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Leasing
The tables that follow summarize leasing activity for the three months ended December 31, 2023. During this period, the Company signed 19 leases in the total portfolio totaling 163,896 square feet. Within the Manhattan office portfolio, the Company signed 14 office leases totaling 135,017 square feet.
Total Portfolio
| Total Portfolio |
Total Leases Executed |
Total square footage executed |
Average cash rent psf – leases executed |
Previously escalated cash rents psf |
% of new cash rent over / under previously escalated rents |
|||||||||||||||
| Office |
16 | 156,444 | $ | 63.40 | $ | 59.93 | 5.8 | % | ||||||||||||
| Retail |
3 | 7,452 | $ | 189.20 | $ | 288.16 | -34.3 | % | ||||||||||||
| Total Overall |
19 | 163,896 | $ | 69.98 | $ | 71.87 | -2.6 | % | ||||||||||||
Manhattan Office Portfolio
| Manhattan Office Portfolio |
Total Leases Executed |
Total square footage executed |
Average cash rent psf – leases executed |
Previously escalated cash rents psf |
% of new cash rent over / under previously escalated rents |
|||||||||||||||
| New Office |
9 | 96,341 | $ | 62.26 | $ | 59.54 | 4.6 | % | ||||||||||||
| Renewal Office |
5 | 38,676 | $ | 66.23 | $ | 60.91 | 8.7 | % | ||||||||||||
| Total Office |
14 | 135,017 | $ | 63.40 | $ | 59.93 | 5.8 | % | ||||||||||||
Leasing Activity Highlights
| • | A 17-year 52,116 square foot new lease with Greater New York Mutual Insurance Company, at the Empire State Building. |
| • | After the quarter end, a 16-year 67,865 square foot expansion lease with Burlington Merchandising Corporation, at 1400 Broadway. |
Observatory Results
In the fourth quarter, Observatory revenue was $36.2 million and expenses were $9.3 million. Observatory NOI was $26.9 million, a 13% increase year-over-year. For the full year 2023, Observatory revenue was $129.4 million and expenses were $35.3 million. Observatory NOI totaled $94.1 million, a 26% increase year-over-year and was in-line with full year 2019 NOI.
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Balance Sheet
The Company had $1.2 billion of total liquidity as of December 31, 2023, which was comprised of $347 million of cash, plus $850 million available under its revolving credit facility. At December 31, 2023, the Company had total debt outstanding of approximately $2.2 billion, no floating rate debt exposure, and a weighted average interest rate of 3.9% per annum. The weighted average term to maturity was 5.4 years. At December 31, 2023, the Company’s ratio of net debt to adjusted EBITDA was 5.4x.
Share Repurchase
The stock repurchase program began in March 2020 and through February 19, 2024, approximately $293.7 million has been repurchased at a weighted average price of $8.18 per share. There were no share repurchases during the fourth quarter.
Dividend
On December 29, 2023, the Company paid a quarterly dividend of $0.035 per share or unit, as applicable, for the fourth quarter of 2023 to holders of the Company’s Class A common stock (NYSE: ESRT) and Class B common stock and to holders of the Series ES, Series 250 and Series 60 partnership units (NYSE Arca: ESBA, FISK and OGCP, respectively) and Series PR partnership units of Empire State Realty OP, L.P., the Company’s operating partnership (the “Operating Partnership”).
On December 29, 2023, the Company paid a quarterly preferred dividend of $0.15 per unit for the fourth quarter of 2023 to holders of the Operating Partnership’s Series 2014 private perpetual preferred units and a preferred dividend of $0.175 per unit for the fourth quarter of 2023 to holders of the Operating Partnership’s Series 2019 private perpetual preferred units.
4
2024 Earnings Outlook
The Company has provided initial 2024 guidance and key assumptions, as summarized in the table below. The Company’s guidance does not include the impact of any significant future lease termination fee income or any unannounced acquisition, disposition or other capital markets activity.
| Key Assumptions | 2024 Guidance |
2023 Actual Results |
Comments | |||||||
|
Earnings |
||||||||||
| Core FFO Per Fully Diluted Share |
$0.90 to $0.94 | |
$0.93 ($0.90 ex non- |
|
• 2023 FFO included approximately $0.03 of non-recurring items
• 2024 includes $0.04 from multifamily assets | |||||
| Commercial Property Drivers |
||||||||||
| Commercial Occupancy at year-end |
87% to 89% | 86.3% | ||||||||
| SS Property Cash NOI (excluding lease termination fees) |
-1% to +2% | +2.2% | • Assumes positive revenue growth
• Assumes a ~6-8% y/y increase in operating expenses and real estate taxes, partially offset by higher tenant expense reimbursements | |||||||
| Observatory Drivers |
||||||||||
|
Observatory NOI |
$94M to $102M | $94.1M |
• Reflects average quarterly expenses of ~$9M | |||||||
| Low | High | |||||||
| Net Income (Loss) Attributable to Common Stockholders and the Operating Partnership |
$ | 0.24 | $ | 0.28 | ||||
| Add: |
||||||||
| Impairment Charge |
0.00 | 0.00 | ||||||
| Real Estate Depreciation & Amortization |
0.65 | 0.65 | ||||||
| Less: |
||||||||
| Private Perpetual Distributions |
0.02 | 0.02 | ||||||
| Gain on Disposal of Real Estate, net |
0.00 | 0.00 | ||||||
|
|
|
|
|
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| FFO Attributable to Common Stockholders and the Operating Partnership |
$ | 0.87 | $ | 0.91 | ||||
| Add: |
||||||||
| Amortization of Below Market Ground Lease |
0.03 | 0.03 | ||||||
|
|
|
|
|
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| Core FFO Attributable to Common Stockholders and the Operating Partnership |
$ | 0.90 | $ | 0.94 | ||||
The estimates set forth above may be subject to fluctuations as a result of several factors, including continued impacts of changes in the use of office space and remote work on our business and our market, our ability to complete planned capital improvements in line with budget, costs of integration of completed acquisitions, costs associated with future acquisitions or other transactions, straight-line rent adjustments and the amortization of above and below-market leases. There can be no assurance that the Company’s actual results will not differ materially from the estimates set forth above.
5
Investor Presentation Update
The Company has posted on the “Investors” section of ESRT’s website the latest investor presentation, which contains additional information on its businesses, financial condition and results of operations.
Webcast and Conference Call Details
Empire State Realty Trust, Inc. will host a webcast and conference call, open to the general public, on Wednesday, February 21, 2024 at 12:00 pm Eastern time.
The webcast will be accessible on the “Investors” section of ESRT’s website. To listen to the live webcast, go to the site at least five minutes prior to the scheduled start time in order to register and download and install any necessary audio software. The conference call can also be accessed by dialing 1-877-407-3982 for domestic callers or 1-201-493-6780 for international callers.
Starting shortly after the call until February 28, 2024, a replay of the webcast will be available on the Company’s website, and a dial-in replay will be available by dialing 1-844-512-2921 for domestic callers or 1-412-317-6671 for international callers. The passcode for this dial-in replay is 13739774.
The Supplemental Report and Investor Presentation are additional components of the quarterly earnings announcement and are now available on the “Investors” section of ESRT’s website.
The Company uses, and intends to continue to use, the “Investors” page of its website, which can be found at www.esrtreit.com, as a means to disclose material nonpublic information and to comply with its disclosure obligations under Regulation FD, including, without limitation, through the posting of investor presentations that may include material nonpublic information. Accordingly, investors should monitor the “Investors” page, in addition to following our press releases, SEC filings, public conference calls, presentations and webcasts. The information contained on, or that may be accessed through, our website is not incorporated by reference into, and is not a part of, this document.
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About Empire State Realty Trust
Empire State Realty Trust, Inc. (NYSE: ESRT) is a NYC-focused REIT that owns and operates a portfolio of modernized, amenitized, and well-located office, retail, and multifamily assets. The Company is the recognized leader in energy efficiency and indoor environmental quality. ESRT’s flagship Empire State Building – the “World’s Most Famous Building” – includes its Observatory, the #1 attraction in the U.S. in Tripadvisor’s Travelers’ Choice Awards: Best of the Best for two consecutive years. As of December 31, 2023, ESRT’s portfolio is comprised of approximately 8.6 million rentable square feet of office space, 0.7 million rentable square feet of retail space and 727 residential units. More information about Empire State Realty Trust can be found at esrtreit.com and by following ESRT on Facebook, Instagram, TikTok, X, and LinkedIn.
Forward-Looking Statements
This press release includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We intend these forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and are including this statement for purposes of complying with those safe harbor provisions. You can identify forward-looking statements by the use of forward-looking terminology such as “aims,” “anticipates,” “approximately,” “believes,” “contemplates,” “continues,” “estimates,” “expects,” “forecasts,” “hope,” “intends,” “may,” “plans,” “seeks,” “should,” “thinks,” “will,” “would” or the negative of these words and phrases or similar words or phrases. For the avoidance of doubt, any projection, guidance, or similar estimation about the future or future results, performance or achievements is a forward-looking statement.
Forward-looking statements are subject to substantial risks and uncertainties, many of which are difficult to predict and are generally beyond our control, and you should not rely on them as predictions of future events. Forward-looking statements depend on assumptions, data or methods which may be incorrect or imprecise, and we may not be able to realize them. We do not guarantee that the transactions and events described will happen as described (or that they will happen at all).
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Many important factors could cause our actual results, performance, achievements, and future events to differ materially from those set forth, implied, anticipated, expected, projected, assumed or contemplated in our forward-looking statements, including, among other things: (i) economic, market, political and social impact of, and uncertainty relating to, any catastrophic events, including pandemics, epidemics or other outbreaks of disease, climate-related risks such as natural disasters and extreme weather events, terrorism and other armed hostilities, as well as cybersecurity threats and technology disruptions; (ii) a failure of conditions or performance regarding any event or transaction described herein; (iii) resolution of legal proceedings involving the Company; (iv) reduced demand for office, multifamily or retail space, including as a result of the changes in the use of office space and remote work; (v) changes in our business strategy; (vi) a decline in Observatory visitors due to changes in domestic or international tourism, including due to health crises, geopolitical events, currency exchange rates, and/or competition from other observatories; (vii) defaults on, early terminations of, or non-renewal of, leases by tenants; (viii) increases in the Company’s borrowing costs as a result of changes in interest rates and other factors; (ix) declining real estate valuations and impairment charges; (x) termination of our ground leases; (xi) limitations on our ability to pay down, refinance, restructure or extend our indebtedness or borrow additional funds; (xii) decreased rental rates or increased vacancy rates; (xiii) difficulties in executing capital projects or development projects successfully or on the anticipated timeline or budget; (xiv) difficulties in identifying and completing acquisitions; (xv) impact of changes in governmental regulations, tax laws and rates and similar matters; (xvi) our failure to qualify as a REIT; (xvii) incurrence of taxable capital gain on disposition of an asset due to failure of compliance with a 1031 exchange program; and (xviii) failure to achieve sustainability metrics and goals, including as a result of tenant collaboration, and impact of governmental regulation on our sustainability efforts. For a further discussion of these and other factors that could impact the company’s future results, performance, or transactions, see the section entitled “Risk Factors” of our annual report on Form 10-K for the year ended December 31, 2022 and any additional factors that may be contained in any filing we make with the SEC.
While forward-looking statements reflect the Company’s good faith beliefs, they do not guarantee future performance. Any forward-looking statement contained in this press release speaks only as of the date on which it was made, and we assume no obligation to update or revise publicly any forward-looking
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statement to reflect changes in underlying assumptions or factors, new information, data or methods, future events, or other changes after the date of this press release, except as required by applicable law. Prospective investors should not place undue reliance on any forward-looking statements, which are based only on information currently available to the Company (or to third parties making the forward-looking statements).
Contact: Investors and Media
Empire State Realty Trust Investor Relations
(212) 850-2678
IR@esrtreit.com
9
Empire State Realty Trust, Inc.
Condensed Consolidated Statements of Operations
(unaudited and amounts in thousands, except per share data)
| Three Months Ended December 31, |
||||||||
| 2023 | 2022 | |||||||
| Revenues |
||||||||
| Rental revenue |
$ | 151,167 | $ | 145,905 | ||||
| Observatory revenue |
36,217 | 32,318 | ||||||
| Lease termination fees |
— | — | ||||||
| Third-party management and other fees |
275 | 336 | ||||||
| Other revenue and fees |
5,223 | 2,714 | ||||||
|
|
|
|
|
|||||
| Total revenues |
192,882 | 181,273 | ||||||
| Operating expenses |
||||||||
| Property operating expenses |
42,944 | 39,060 | ||||||
| Ground rent expenses |
2,332 | 2,332 | ||||||
| General and administrative expenses |
16,144 | 16,478 | ||||||
| Observatory expenses |
9,282 | 8,529 | ||||||
| Real estate taxes |
31,809 | 31,420 | ||||||
| Depreciation and amortization |
49,599 | 44,500 | ||||||
|
|
|
|
|
|||||
| Total operating expenses |
152,110 | 142,319 | ||||||
|
|
|
|
|
|||||
| Total operating income |
40,772 | 38,954 | ||||||
| Other income (expense): |
||||||||
| Interest income |
4,740 | 2,804 | ||||||
| Interest expense |
(25,393 | ) | (25,634 | ) | ||||
| Gain (loss) on sale of properties |
(2,497 | ) | 6,818 | |||||
|
|
|
|
|
|||||
| Income before income taxes |
17,622 | 22,942 | ||||||
| Income tax expense |
(1,792 | ) | (1,322 | ) | ||||
|
|
|
|
|
|||||
| Net income |
15,830 | 21,620 | ||||||
| Net (income) loss attributable to noncontrolling interests: |
||||||||
| Noncontrolling interest in the Operating Partnership |
(5,670 | ) | (7,947 | ) | ||||
| Noncontrolling interests in other partnerships |
1 | (28 | ) | |||||
| Preferred unit distributions |
(1,050 | ) | (1,050 | ) | ||||
|
|
|
|
|
|||||
| Net income attributable to common stockholders |
$ | 9,111 | $ | 12,595 | ||||
|
|
|
|
|
|||||
| Total weighted average shares |
||||||||
| Basic |
161,974 | 161,720 | ||||||
|
|
|
|
|
|||||
| Diluted |
267,003 | 265,370 | ||||||
|
|
|
|
|
|||||
| Earnings per share attributable to common stockholders |
||||||||
| Basic |
$ | 0.06 | $ | 0.08 | ||||
|
|
|
|
|
|||||
| Diluted |
$ | 0.06 | $ | 0.08 | ||||
|
|
|
|
|
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Empire State Realty Trust, Inc.
Condensed Consolidated Statements of Operations
(unaudited and amounts in thousands, except per share data)
| Year Ended December 31, | ||||||||
| 2023 | 2022 | |||||||
| Revenues |
||||||||
| Rental revenue |
$ | 597,319 | $ | 591,048 | ||||
| Observatory revenue |
129,366 | 105,978 | ||||||
| Lease termination fees |
— | 20,032 | ||||||
| Third-party management and other fees |
1,351 | 1,361 | ||||||
| Other revenue and fees |
11,536 | 8,622 | ||||||
|
|
|
|
|
|||||
| Total revenues |
739,572 | 727,041 | ||||||
| Operating expenses |
||||||||
| Property operating expenses |
167,324 | 157,935 | ||||||
| Ground rent expenses |
9,326 | 9,326 | ||||||
| General and administrative expenses |
63,939 | 61,765 | ||||||
| Observatory expenses |
35,265 | 31,036 | ||||||
| Real estate taxes |
127,101 | 123,057 | ||||||
| Depreciation and amortization |
189,911 | 216,894 | ||||||
|
|
|
|
|
|||||
| Total operating expenses |
592,866 | 600,013 | ||||||
|
|
|
|
|
|||||
| Total operating income |
146,706 | 127,028 | ||||||
| Other income (expense): |
||||||||
| Interest income |
15,136 | 4,948 | ||||||
| Interest expense |
(101,484 | ) | (101,206 | ) | ||||
| Gain on sale/disposition of properties |
26,764 | 33,988 | ||||||
|
|
|
|
|
|||||
| Income before income taxes |
87,122 | 64,758 | ||||||
| Income tax benefit |
(2,715 | ) | (1,546 | ) | ||||
|
|
|
|
|
|||||
| Net income |
84,407 | 63,212 | ||||||
| Net (income) loss attributable to noncontrolling interests: |
||||||||
| Noncontrolling interest in the Operating Partnership |
(31,094 | ) | (22,812 | ) | ||||
| Noncontrolling interests in other partnerships |
(68 | ) | 243 | |||||
| Preferred unit distributions |
(4,201 | ) | (4,201 | ) | ||||
|
|
|
|
|
|||||
| Net income attributable to common stockholders |
$ | 49,044 | $ | 36,442 | ||||
|
|
|
|
|
|||||
| Total weighted average shares |
||||||||
| Basic |
161,122 | 165,039 | ||||||
|
|
|
|
|
|||||
| Diluted |
265,633 | 269,948 | ||||||
|
|
|
|
|
|||||
| Earnings per share attributable to common stockholders |
||||||||
| Basic |
$ | 0.30 | $ | 0.22 | ||||
|
|
|
|
|
|||||
| Diluted |
$ | 0.30 | $ | 0.22 | ||||
|
|
|
|
|
|||||
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Empire State Realty Trust, Inc.
Reconciliation of Net Income to Funds From Operations (“FFO”),
Modified Funds From Operations (“Modified FFO”) and Core Funds From Operations (“Core FFO”)
(unaudited and amounts in thousands, except per share data)
| Three Months Ended December 31, |
||||||||
| 2023 | 2022 | |||||||
| Net income |
$ | 15,830 | $ | 21,620 | ||||
| Noncontrolling interests in other partnerships |
1 | (28 | ) | |||||
| Preferred unit distributions |
(1,050 | ) | (1,050 | ) | ||||
| Real estate depreciation and amortization |
48,548 | 43,076 | ||||||
| (Gain) loss on sale of properties |
2,497 | (6,818 | ) | |||||
|
|
|
|
|
|||||
| FFO attributable to common stockholders and Operating Partnership units |
65,826 | 56,800 | ||||||
| Amortization of below-market ground leases |
1,958 | 1,958 | ||||||
|
|
|
|
|
|||||
| Modified FFO attributable to common stockholders and Operating Partnership units |
67,784 | 58,758 | ||||||
|
|
|
|
|
|||||
| Core FFO attributable to common stockholders and Operating Partnership units |
$ | 67,784 | $ | 58,758 | ||||
|
|
|
|
|
|||||
| Total weighted average shares and Operating Partnership units |
||||||||
| Basic |
262,775 | 263,759 | ||||||
|
|
|
|
|
|||||
| Diluted |
267,003 | 265,370 | ||||||
|
|
|
|
|
|||||
| FFO per share |
||||||||
| Basic |
$ | 0.25 | $ | 0.22 | ||||
|
|
|
|
|
|||||
| Diluted |
$ | 0.25 | $ | 0.21 | ||||
|
|
|
|
|
|||||
| Modified FFO per share |
||||||||
| Basic |
$ | 0.26 | $ | 0.22 | ||||
|
|
|
|
|
|||||
| Diluted |
$ | 0.25 | $ | 0.22 | ||||
|
|
|
|
|
|||||
| Core FFO per share |
||||||||
| Basic |
$ | 0.26 | $ | 0.22 | ||||
|
|
|
|
|
|||||
| Diluted |
$ | 0.25 | $ | 0.22 | ||||
|
|
|
|
|
|||||
12
Empire State Realty Trust, Inc.
Reconciliation of Net Income to Funds From Operations (“FFO”),
Modified Funds From Operations (“Modified FFO”) and Core Funds From Operations (“Core FFO”)
(unaudited and amounts in thousands, except per share data)
| Year Ended December 31, |
||||||||
| 2023 | 2022 | |||||||
| Net income |
$ | 84,407 | $ | 63,212 | ||||
| Noncontrolling interests in other partnerships |
(68 | ) | 243 | |||||
| Preferred unit distributions |
(4,201 | ) | (4,201 | ) | ||||
| Real estate depreciation and amortization |
184,633 | 210,522 | ||||||
| Gain on sale/disposition of properties |
(26,764 | ) | (33,988 | ) | ||||
|
|
|
|
|
|||||
| FFO attributable to common stockholders and Operating Partnership units |
238,007 | 235,788 | ||||||
| Amortization of below-market ground leases |
7,831 | 7,831 | ||||||
|
|
|
|
|
|||||
| Modified FFO attributable to common stockholders and Operating Partnership units |
245,838 | 243,619 | ||||||
|
|
|
|
|
|||||
| Core FFO attributable to common stockholders and Operating Partnership units |
$ | 245,838 | $ | 243,619 | ||||
|
|
|
|
|
|||||
| Total weighted average shares and Operating Partnership units |
||||||||
| Basic |
263,226 | 268,337 | ||||||
|
|
|
|
|
|||||
| Diluted |
265,633 | 269,948 | ||||||
|
|
|
|
|
|||||
| FFO per share |
||||||||
| Basic |
$ | 0.90 | $ | 0.88 | ||||
|
|
|
|
|
|||||
| Diluted |
$ | 0.90 | $ | 0.87 | ||||
|
|
|
|
|
|||||
| Modified FFO per share |
||||||||
| Basic |
$ | 0.93 | $ | 0.91 | ||||
|
|
|
|
|
|||||
| Diluted |
$ | 0.93 | $ | 0.90 | ||||
|
|
|
|
|
|||||
| Core FFO per share |
||||||||
| Basic |
$ | 0.93 | $ | 0.91 | ||||
|
|
|
|
|
|||||
| Diluted |
$ | 0.93 | $ | 0.90 | ||||
|
|
|
|
|
|||||
13
Empire State Realty Trust, Inc.
Condensed Consolidated Balance Sheets
(unaudited and amounts in thousands)
| December 31, | December 31, | |||||||
| 2023 | 2022 | |||||||
| Assets |
||||||||
| Commercial real estate properties, at cost |
$ | 3,655,192 | $ | 3,551,449 | ||||
| Less: accumulated depreciation |
(1,250,062 | ) | (1,137,267 | ) | ||||
|
|
|
|
|
|||||
| Commercial real estate properties, net |
2,405,130 | 2,414,182 | ||||||
|
|
|
|
|
|||||
| Assets held for sale |
— | 35,538 | ||||||
| Cash and cash equivalents |
346,620 | 264,434 | ||||||
| Restricted cash |
60,336 | 50,244 | ||||||
| Tenant and other receivables |
39,836 | 24,102 | ||||||
| Deferred rent receivables |
255,628 | 240,188 | ||||||
| Prepaid expenses and other assets |
98,167 | 98,114 | ||||||
| Deferred costs, net |
172,457 | 187,570 | ||||||
| Acquired below market ground leases, net |
321,241 | 329,073 | ||||||
| Right of use assets |
28,439 | 28,670 | ||||||
| Goodwill |
491,479 | 491,479 | ||||||
|
|
|
|
|
|||||
| Total assets |
$ | 4,219,333 | $ | 4,163,594 | ||||
|
|
|
|
|
|||||
| Liabilities and equity |
||||||||
| Mortgage notes payable, net |
$ | 877,388 | $ | 883,705 | ||||
| Senior unsecured notes, net |
973,872 | 973,659 | ||||||
| Unsecured term loan facility, net |
389,286 | 388,773 | ||||||
| Accounts payable and accrued expenses |
99,756 | 80,729 | ||||||
| Acquired below market leases, net |
13,750 | 17,849 | ||||||
| Ground lease liabilities |
28,439 | 28,670 | ||||||
| Deferred revenue and other liabilities |
70,298 | 76,091 | ||||||
| Tenants’ security deposits |
35,499 | 25,084 | ||||||
| Liabilities related to assets held for sale |
— | 5,943 | ||||||
|
|
|
|
|
|||||
| Total liabilities |
2,488,288 | 2,480,503 | ||||||
| Total equity |
1,731,045 | 1,683,091 | ||||||
|
|
|
|
|
|||||
| Total liabilities and equity |
$ | 4,219,333 | $ | 4,163,594 | ||||
|
|
|
|
|
|||||
14
Exhibit 99.2
|
Fourth Quarter 2023 |
| Page | ||||
| Table of Contents | ||||
| Summary |
||||
| Supplemental Definitions |
3 | |||
| Company Profile |
5 | |||
| Condensed Consolidated Balance Sheets |
6 | |||
| Condensed Consolidated Statements of Operations |
7 | |||
| Highlights |
8 | |||
| Selected Property Data |
||||
| Property Summary Net Operating Income |
9 | |||
| Same Store Net Operating Income (“NOI”), Initial Cash Rent Contributing to Cash NOI |
10 | |||
| Leasing Activity |
11 | |||
| Commercial Property Detail |
13 | |||
| Portfolio Expirations and Vacates Summary |
14 | |||
| Tenant Lease Expirations |
15 | |||
| Largest Tenants and Portfolio Tenant Diversification by Industry |
17 | |||
| Capital Expenditures and Redevelopment Program |
18 | |||
| Observatory Summary |
19 | |||
| Financial information |
||||
| FFO, Modified FFO, Core FFO, FAD and EBITDA |
20 | |||
| Consolidated Debt Analysis |
||||
| Debt Summary |
21 | |||
| Debt Detail |
22 | |||
| Debt Maturities |
23 | |||
| Ground Leases |
23 | |||
Forward-looking Statements
This presentation includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We intend these forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and are including this statement for purposes of complying with those safe harbor provisions. You can identify forward-looking statements by the use of forward-looking terminology such as “aims,” “anticipates,” “approximately,” “believes,” “contemplates,” “continues,” “estimates,” “expects,” “forecasts,” “hope,” “intends,” “may,” “plans,” “seeks,” “should,” “thinks,” “will,” “would” or the negative of these words and phrases or similar words or phrases. For the avoidance of doubt, any projection, guidance, or similar estimation about the future or future results, performance or achievements is a forward-looking statement.
Forward-looking statements are subject to substantial risks and uncertainties, many of which are difficult to predict and are generally beyond our control, and you should not rely on them as predictions of future events. Forward-looking statements depend on assumptions, data or methods which may be incorrect or imprecise, and we may not be able to realize them. We do not guarantee that the transactions and events described will happen as described (or that they will happen at all).
Many important factors could cause our actual results, performance, achievements, and future events to differ materially from those set forth, implied, anticipated, expected, projected, assumed or contemplated in our forward-looking statements, including, among other things: (i) economic, market, political and social impact of, and uncertainty relating to, any catastrophic events, including pandemics, epidemics or other outbreaks of disease, climate-related risks such as natural disasters and extreme weather events, terrorism and other armed hostilities, as well as cybersecurity threats and technology disruptions; (ii) a failure of conditions or performance regarding any event or transaction described herein; (iii) resolution of legal proceedings involving the Company; (iv) reduced demand for office, multifamily or retail space, including as a result of the changes in the use of office space and remote work; (v) changes in our business strategy; (vi) a decline in Observatory visitors due to changes in domestic or international tourism, including due to health crises, geopolitical events, currency exchange rates, and/or competition from other observatories; (vii) defaults on, early terminations of, or non-renewal of, leases by tenants; (viii) increases in the Company’s borrowing costs as a result of changes in interest rates and other factors; (ix) declining real estate valuations and impairment charges; (x) termination of our ground leases; (xi) limitations on our ability to pay down, refinance, restructure or extend our indebtedness or borrow additional funds; (xii) decreased rental rates or increased vacancy rates; (xiii) difficulties in executing capital projects or development projects successfully or on the anticipated timeline or budget; (xiv) difficulties in identifying and completing acquisitions; (xv) impact of changes in governmental regulations, tax laws and rates and similar matters; (xvi) our failure to qualify as a REIT; (xvii) incurrence of taxable capital gain on disposition of an asset due to failure of compliance with a 1031 exchange program; and (xviii) failure to achieve sustainability metrics and goals, including as a result of tenant collaboration, and impact of governmental regulation on our sustainability efforts. For a further discussion of these and other factors that could impact the company’s future results, performance, or transactions, see the section entitled “Risk Factors” of our annual report on Form 10-K for the year ended December 31, 2022 and any additional factors that may be contained in any filing we make with the U.S. Securities and Exchange Commission.
While forward-looking statements reflect the company’s good faith beliefs, they do not guarantee future performance. Any forward-looking statement contained in this presentation speaks only as of the date on which it was made, and we assume no obligation to update or revise publicly any forward-looking statement to reflect changes in underlying assumptions or factors, new information, data or methods, future events, or other changes after the date of this presentation, except as required by applicable law. Prospective investors should not place undue reliance on any forward-looking statements, which are based only on information currently available to the company (or to third parties making the forward-looking statements).
Page 2
|
|
Fourth Quarter 2023 Supplemental Definitions |
Funds From Operations (“FFO”)
We compute FFO in accordance with the “White Paper” on FFO published by the National Association of Real Estate Investment Trusts, or NAREIT, which defines FFO as net income (loss) (determined in accordance with GAAP), excluding impairment write-off of investments in depreciable real estate and investments in in-substance real estate investments, gains or losses from debt restructurings and sales of depreciable operating properties, plus real estate-related depreciation and amortization (excluding amortization of deferred financing costs), less distributions to non-controlling interests and gains/losses from discontinued operations and after adjustments for unconsolidated partnerships and joint ventures. FFO is a widely recognized non-GAAP financial measure for REITs that we believe, when considered with financial statements determined in accordance with GAAP, is useful to investors in understanding financial performance and providing a relevant basis for comparison among REITs. In addition, we believe FFO is useful to investors as it captures features particular to real estate performance by recognizing that real estate has generally appreciated over time or maintains residual value to a much greater extent than do other depreciable assets. Investors should review FFO, along with GAAP net income, when trying to understand an equity REIT’s operating performance. We present FFO because we consider it an important supplemental measure of our operating performance and believe that it is frequently used by securities analysts, investors and other interested parties in the evaluation of REITs. However, because FFO excludes depreciation and amortization and captures neither the changes in the value of our properties that result from use or market conditions nor the level of capital expenditures and leasing commissions necessary to maintain the operating performance of our properties, all of which have real economic effect and could materially impact our results of operations, the utility of FFO as a measure of its performance is limited. There can be no assurance that FFO presented by us is comparable to similarly titled measures of other REITs. FFO does not represent cash generated from operating activities and should not be considered as an alternative to net income (loss) determined in accordance with GAAP or to cash flow from operating activities determined in accordance with GAAP. FFO is not indicative of cash available to fund ongoing cash needs, including the ability to make cash distributions. Although FFO is a measure used for comparability in assessing the performance of REITs, as the NAREIT White Paper only provides guidelines for computing FFO, the computation of FFO may vary from one company to another.
Modified Funds From Operations (“Modified FFO”)
Modified FFO adds back an adjustment for any above or below-market ground lease amortization to traditionally defined FFO. We believe this a useful supplemental measure in evaluating our operating performance due to the non-cash accounting treatment under GAAP, which stems from the third quarter 2014 acquisition of two option properties following our formation transactions as they carry significantly below market ground leases, the amortization of which is material to our overall results. We present Modified FFO because we believe it is an important supplemental measure of our operating performance in that it adds back the non-cash amortization of below-market ground leases. There can be no assurance that Modified FFO presented by us is comparable to similarly titled measures of other REITs. Modified FFO does not represent cash generated from operating activities and should not be considered as an alternative to net income (loss) determined in accordance with GAAP or to cash flow from operating activities determined in accordance with GAAP. Modified FFO is not indicative of cash available to fund ongoing cash needs, including the ability to make cash distributions.
Core Funds From Operations (“Core FFO”)
Core FFO adds back to Modified FFO the following items: loss on early extinguishment of debt, acquisition expenses, severance expenses and IPO litigation expense. The Company believes Core FFO is an important supplemental measure of its operating performance because it excludes non-recurring items. There can be no assurance that Core FFO presented by the Company is comparable to similarly titled measures of other REITs. Core FFO does not represent cash generated from operating activities and should not be considered as an alternative to net income (loss) determined in accordance with GAAP or to cash flow from operating activities determined in accordance with GAAP. Core FFO is not indicative of cash available to fund ongoing cash needs, including the ability to make cash distributions. In future periods, we may also exclude other items from Core FFO that we believe may help investors compare our results.
Core Funds Available for Distribution (“Core FAD”)
In addition to Core FFO, we present Core FAD by (i) adding to Core FFO non-real estate depreciation and amortization, the amortization of deferred financing costs, amortization of debt discounts and non-cash compensation expenses and (ii) deducting straight line rent, amortization of debt premiums and above/below market rent revenue, and recurring capital improvements such as second generation leasing commissions, tenant improvements, prebuilts, capital expenditures and furniture, fixtures & equipment. Core FAD is presented solely as a supplemental disclosure that we believe provides useful information regarding our ability to fund our dividends. Core FAD does not represent cash generated from operating activities and should not be considered as an alternative to net income (loss) determined in accordance with GAAP or to cash flow from operating activities determined in accordance with GAAP. Core FAD is not indicative of cash available to fund ongoing cash needs, including the ability to make cash distributions. There can be no assurance that Core FAD presented by us is comparable to similarly titled measures of other REITs.
Net Operating Income (“NOI”) and Property Cash NOI
NOI is a non-GAAP financial measure of performance. NOI is used by our management to evaluate and compare the performance of our properties and to determine trends in earnings and to compute the fair value of our properties as it is not affected by: (i) the cost of funds of the property owner, (ii) the impact of depreciation and amortization expenses as well as gains or losses from the sale of operating real estate assets that are included in net income computed in accordance with GAAP, (iii) acquisition expenses, loss on early extinguishment of debt, impairment charges and loss from derivative financial instruments, or (iv) general and administrative expenses and other gains and losses that are specific to the property owner. The cost of funds is eliminated from NOI because it is specific to the particular financing capabilities and constraints of the owner. The cost of funds is eliminated because it is dependent on historical interest rates and other costs of capital as well as past decisions made by us regarding the appropriate mix of capital which may have changed or may change in the future. Depreciation and amortization expenses as well as gains or losses from the sale of operating real estate assets are eliminated because they may not accurately represent the actual change in value in our office or retail properties that result from use of the properties or changes in market conditions. While certain aspects of real property do decline in value over time in a manner that is reasonably captured by depreciation and amortization, the value of the properties as a whole have historically increased or decreased as a result of changes in overall economic conditions instead of from actual use of the property or the passage of time. Gains and losses from the sale of real property vary from property to property and are affected by market conditions at the time of sale which will usually change from period to period. These gains and losses can create distortions when comparing one period to another or when comparing our operating results to the operating results of other real estate companies that have not made similarly-timed purchases or sales. We believe that eliminating these costs from net income is useful to investors because the resulting measure captures the actual revenue generated and actual expenses incurred in operating our properties as well as trends in occupancy rates, rental rates and operating costs. In some cases, the Company also presents (1) Property Cash NOI, which excludes Observatory NOI and the effects of straight-line rent, fair value lease revenue, and straight-line ground rent expense adjustment, and (2) Property Cash NOI excluding lease termination fees. Property Cash NOI is presented solely as a supplemental disclosure that management believes allows investors to compare NOI performance across periods without taking into account the effect of certain non-cash rental revenues and straight-line ground rent expense adjustment. Similar to depreciation and amortization expense, fair value lease revenues, because of historical cost accounting, may distort operating performance measures at the property level. Additionally, presenting NOI excluding the impact of straight-line rent and straight-line ground rent expense adjustment provides investors with an alternative view of operating performance at the property level that more closely reflects net cash generated in the portfolio. Presenting Property Cash NOI excluding lease termination fees provides investors with additional information that allows them to compare operating performance between periods without taking into account termination fees, which can distort the results for any given period because they generally represent multiple months or years of a tenant’s rental obligations that are paid in a lump sum in connection with a negotiated early termination of the tenant’s lease and are not reflective of the core ongoing operating performance of the Company’s portfolio. However, the usefulness of NOI, Property Cash NOI, and Property Cash NOI excluding lease termination fees is limited because it excludes general and administrative costs, interest expense, depreciation and amortization expense and gains or losses from the sale of properties, and other gains and losses as stipulated by GAAP, the level of capital expenditures and leasing costs necessary to maintain the operating performance of our properties, all of which are significant economic costs. NOI and Property Cash NOI may fail to capture significant trends in these components of net income which further limits its usefulness. NOI and Property Cash NOI are measurements of the operating performance of our properties but do not measure our performance as a whole. These metrics therefore are not substitutes for net income as computed in accordance with GAAP. These measures should be analyzed in conjunction with net income computed in accordance with GAAP. Other companies may use different methods for calculating NOI, Property Cash NOI or similarly titled measures and, accordingly, our measures may not be comparable to similarly titled measures reported by other companies that do not define the measure exactly as we do.
Same Store
In the Company’s analysis of NOI, particularly to make comparisons of NOI between periods meaningful, it is important to provide information for properties that were owned by the Company throughout each period presented. The Company refers to properties acquired prior to the beginning of the earliest period presented and owned by the Company through the end of the latest period presented as “Same Store.” Same Store therefore excludes properties acquired after the beginning of the earliest period presented or disposed of prior to the end of the latest period presented. Accordingly, it takes at least one year and one quarter after a property is acquired for that property to be included in Same Store. The Company’s definition of Same Store also excludes properties held-for-sale or those which we otherwise expect to dispose of in the subsequent quarter and our multifamily properties. For mixed-use properties, all same store property NOI is represented in the property category that comprises the majority of that mixed-use property’s NOI.
Page 3
|
|
Fourth Quarter 2023 Supplemental Definitions |
EBITDA and Adjusted EBITDA
We compute EBITDA as net income plus interest expense, income taxes and depreciation. We present EBITDA because we believe that EBITDA, along with cash flow from operating activities, investing activities and financing activities, provides investors with an additional indicator of its ability to incur and service debt. EBITDA should not be considered as an alternative to net income (determined in accordance with GAAP), as an indication of our financial performance, as an alternative to net cash flows from operating activities (determined in accordance with GAAP), or as a measure of its liquidity. For adjusted EBITDA, we add back impairment charges and gain on disposition of property.
Net Debt to Adjusted EBITDA
We compute Net Debt to Adjusted EBITDA as the Company’s pro-rata share of gross debt less cash and cash equivalents divided by the Company’s pro-rata share of trailing twelve months Adjusted EBITDA. The Company believes that the presentation of Net Debt to Adjusted EBITDA provides useful information to investors because the Company reviews Net Debt to Adjusted EBITDA as part of the management of its overall financial flexibility, capital structure and leverage based on its percentage ownership interest in all of its assets.
Page 4
|
|
Fourth Quarter 2023 |
COMPANY PROFILE
Empire State Realty Trust, Inc., or the Company, is a NYC-focused REIT that owns and operates a portfolio of modernized, amenitized, and well-located office, retail, and multifamily assets. The Company is a recognized leader in energy efficiency and indoor environmental quality. ESRT’s flagship Empire State Building – the “World’s Most Famous Building” – includes its Observatory, the #1 attraction in the U.S. in Tripadvisor’s Travelers’ Choice Awards: Best of the Best for two consecutive years.
BOARD OF DIRECTORS
| Anthony E. Malkin | Chairman and Chief Executive Officer | |
| Thomas J. DeRosa | Director, Chair of the Compensation and Human Capital Committee | |
| Steven J. Gilbert | Director, Lead Independent Director | |
| S. Michael Giliberto | Director, Chair of the Audit Committee | |
| Patricia S. Han | Director | |
| Grant H. Hill | Director | |
| R. Paige Hood | Director, Chair of the Finance Committee | |
| James D. Robinson IV | Director, Chair of the Nominating and Corporate Governance Committee | |
| Christina Van Tassell | Director | |
| Hannah Yang | Director |
EXECUTIVE MANAGEMENT
| Anthony E. Malkin | Chairman and Chief Executive Officer | |
| Christina Chiu | President | |
| Thomas P. Durels | Executive Vice President, Real Estate | |
| Steve Horn |
Executive Vice President, Chief Financial Officer & Chief Accounting Officer |
COMPANY INFORMATION
| Corporate Headquarters | Investor Relations | New York Stock Exchange | ||
| 111 West 33rd Street, 12th Floor | IR@esrtreit.com | Trading Symbol: ESRT | ||
| New York, NY 10120 | ||||
| www.esrtreit.com | ||||
| (212) 687-8700 |
RESEARCH COVERAGE
| Bank of America Merrill Lynch | Camille Bonnel | (416) 369-2140 | camille.bonnel@bofa.com | |||
| BMO Capital Markets Corp. | John Kim | (212) 885-4115 | jp.kim@bmo.com | |||
| BTIG | Thomas Catherwood | (212) 738-6140 | tcatherwood@btig.com | |||
| Citi | Michael Griffin | (212) 816-5871 | michael.a.griffin@citi.com | |||
| Evercore ISI | Steve Sakwa | (212) 446-9462 | steve.sakwa@evercoreisi.com | |||
| Green Street Advisors | Dylan Burzinski | (949) 640-8780 | dburzinski@greenstreetadvisors.com | |||
| KeyBanc Capital Markets | Todd Thomas | (917) 368-2286 | tthomas@key.com | |||
| Wells Fargo Securities, LLC | Blaine Heck | (443) 263-6529 | blaine.heck@wellsfargo.com | |||
| Wolfe Research | Andrew Rosivach | (646) 582-9251 | arosivach@wolferesearch.com |
Page 5
|
|
Fourth Quarter 2023 Condensed Consolidated Balance Sheets (unaudited and dollars in thousands) |
| December 31, 2023 |
September 30, 2023 |
June 30, 2023 |
March 31, 2023 |
December 31, 2022 |
||||||||||||||||
| Assets |
||||||||||||||||||||
| Commercial real estate properties, at cost: |
||||||||||||||||||||
| Land |
$ | 366,357 | $ | 366,364 | $ | 361,497 | $ | 361,497 | $ | 365,540 | ||||||||||
| Development costs |
8,178 | 8,178 | 8,204 | 8,178 | 8,166 | |||||||||||||||
| Building and improvements |
3,280,657 | 3,245,555 | 3,196,181 | 3,183,615 | 3,177,743 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| 3,655,192 | 3,620,097 | 3,565,882 | 3,553,290 | 3,551,449 | ||||||||||||||||
| Less: accumulated depreciation |
(1,250,062 | ) | (1,217,967 | ) | (1,180,558 | ) | (1,162,923 | ) | (1,137,267 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Commercial real estate properties, net |
2,405,130 | 2,402,130 | 2,385,324 | 2,390,367 | 2,414,182 | |||||||||||||||
| Assets held for sale |
— | — | — | 35,980 | 35,538 | |||||||||||||||
| Cash and cash equivalents |
346,620 | 353,999 | 315,357 | 272,648 | 264,434 | |||||||||||||||
| Restricted cash |
60,336 | 66,954 | 80,451 | 108,183 | 50,244 | |||||||||||||||
| Tenant and other receivables |
39,836 | 37,651 | 32,901 | 23,879 | 24,102 | |||||||||||||||
| Deferred rent receivables |
255,628 | 254,233 | 249,881 | 238,842 | 240,188 | |||||||||||||||
| Prepaid expenses and other assets |
98,167 | 82,918 | 98,986 | 57,891 | 98,114 | |||||||||||||||
| Deferred costs, net |
172,457 | 175,488 | 176,678 | 182,367 | 187,570 | |||||||||||||||
| Acquired below-market ground leases, net |
321,241 | 323,199 | 325,157 | 327,115 | 329,073 | |||||||||||||||
| Right of use assets |
28,439 | 28,496 | 28,554 | 28,612 | 28,670 | |||||||||||||||
| Goodwill |
491,479 | 491,479 | 491,479 | 491,479 | 491,479 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total assets |
$ | 4,219,333 | $ | 4,216,547 | $ | 4,184,768 | $ | 4,157,363 | $ | 4,163,594 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Liabilities and Equity |
||||||||||||||||||||
| Mortgage notes payable, net |
$ | 877,388 | $ | 878,757 | $ | 880,592 | $ | 882,142 | $ | 883,705 | ||||||||||
| Senior unsecured notes, net |
973,872 | 973,819 | 973,768 | 973,714 | 973,659 | |||||||||||||||
| Unsecured term loan facility, net |
389,286 | 389,158 | 389,028 | 388,901 | 388,773 | |||||||||||||||
| Unsecured revolving credit facility, net |
— | — | — | — | — | |||||||||||||||
| Accounts payable and accrued expenses |
99,756 | 83,299 | 71,709 | 71,605 | 80,729 | |||||||||||||||
| Acquired below-market leases, net |
13,750 | 14,703 | 15,280 | 16,581 | 17,849 | |||||||||||||||
| Ground lease liabilities |
28,439 | 28,496 | 28,554 | 28,612 | 28,670 | |||||||||||||||
| Deferred revenue and other liabilities |
70,298 | 75,688 | 73,972 | 76,769 | 76,091 | |||||||||||||||
| Tenants’ security deposits |
35,499 | 39,307 | 40,253 | 35,111 | 25,084 | |||||||||||||||
| Liabilities related to assets held for sale |
— | — | — | 6,862 | 5,943 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total liabilities |
2,488,288 | 2,483,227 | 2,473,156 | 2,480,297 | 2,480,503 | |||||||||||||||
| Total equity |
1,731,045 | 1,733,320 | 1,711,612 | 1,677,066 | 1,683,091 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total liabilities and equity |
$ | 4,219,333 | $ | 4,216,547 | $ | 4,184,768 | $ | 4,157,363 | $ | 4,163,594 | ||||||||||
|
|
|
|
|
|
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Page 6
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Fourth Quarter 2023 Condensed Consolidated Statements of Operations (unaudited and in thousands, except per share amounts) |
| Three Months Ended | ||||||||||||||||||||
| December 31, 2023 |
September 30, 2023 |
June 30, 2023 |
March 31, 2023 |
December 31, 2022 |
||||||||||||||||
| Revenues |
||||||||||||||||||||
| Rental revenue (1) |
$ | 151,167 | $ | 151,458 | $ | 154,603 | $ | 140,091 | $ | 145,905 | ||||||||||
| Observatory revenue |
36,217 | 37,562 | 33,433 | 22,154 | 32,318 | |||||||||||||||
| Third-party management and other fees |
275 | 268 | 381 | 427 | 336 | |||||||||||||||
| Other revenue and fees |
5,223 | 2,238 | 2,125 | 1,950 | 2,714 | |||||||||||||||
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| Total revenues |
192,882 | 191,526 | 190,542 | 164,622 | 181,273 | |||||||||||||||
| Operating expenses |
||||||||||||||||||||
| Property operating expenses |
42,944 | 42,817 | 39,519 | 42,044 | 39,060 | |||||||||||||||
| Ground rent expenses |
2,332 | 2,331 | 2,332 | 2,331 | 2,332 | |||||||||||||||
| General and administrative expenses |
16,144 | 16,012 | 16,075 | 15,708 | 16,478 | |||||||||||||||
| Observatory expenses |
9,282 | 9,471 | 8,657 | 7,855 | 8,529 | |||||||||||||||
| Real estate taxes |
31,809 | 32,014 | 31,490 | 31,788 | 31,420 | |||||||||||||||
| Depreciation and amortization |
49,599 | 46,624 | 46,280 | 47,408 | 44,500 | |||||||||||||||
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| Total operating expenses |
152,110 | 149,269 | 144,353 | 147,134 | 142,319 | |||||||||||||||
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| Total operating income |
40,772 | 42,257 | 46,189 | 17,488 | 38,954 | |||||||||||||||
| Other income (expense) |
||||||||||||||||||||
| Interest income |
4,740 | 4,462 | 3,339 | 2,595 | 2,804 | |||||||||||||||
| Interest expense |
(25,393 | ) | (25,382 | ) | (25,405 | ) | (25,304 | ) | (25,634 | ) | ||||||||||
| Gain (loss) on disposition of property |
(2,497 | ) | — | 13,565 | 15,696 | 6,818 | ||||||||||||||
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| Income before income taxes |
17,622 | 21,337 | 37,688 | 10,475 | 22,942 | |||||||||||||||
| Income tax (expense) benefit |
(1,792 | ) | (1,409 | ) | (733 | ) | 1,219 | (1,322 | ) | |||||||||||
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| Net income |
15,830 | 19,928 | 36,955 | 11,694 | 21,620 | |||||||||||||||
| Net (income) loss attributable to noncontrolling interests: |
||||||||||||||||||||
| Non-controlling interests in the Operating Partnership |
(5,670 | ) | (7,207 | ) | (14,049 | ) | (4,168 | ) | (7,947 | ) | ||||||||||
| Non-controlling interests in other partnerships |
1 | (111 | ) | (1 | ) | 43 | (28 | ) | ||||||||||||
| Private perpetual preferred unit distributions |
(1,050 | ) | (1,050 | ) | (1,051 | ) | (1,050 | ) | (1,050 | ) | ||||||||||
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| Net income attributable to common stockholders |
$ | 9,111 | $ | 11,560 | $ | 21,854 | $ | 6,519 | $ | 12,595 | ||||||||||
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| Weighted average common shares outstanding |
||||||||||||||||||||
| Basic |
161,974 | 161,851 | 160,028 | 161,339 | 161,720 | |||||||||||||||
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| Diluted |
267,003 | 266,073 | 264,196 | 265,197 | 265,370 | |||||||||||||||
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| Earnings per share attributable to common stockholders |
||||||||||||||||||||
| Basic and diluted |
$ | 0.06 | $ | 0.07 | $ | 0.14 | $ | 0.04 | $ | 0.08 | ||||||||||
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| Dividends per share |
$ | 0.035 | $ | 0.035 | $ | 0.035 | $ | 0.035 | $ | 0.035 | ||||||||||
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Note:
| (1) | The following table reflects the components of rental revenue. |
| Three Months Ended | ||||||||||||||||||||
| December 31, 2023 |
September 30, 2023 |
June 30, 2023 |
March 31, 2023 |
December 31, 2022 |
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| Rental Revenue |
||||||||||||||||||||
| Base rent |
$ | 134,467 | $ | 133,228 | $ | 138,808 | $ | 124,782 | $ | 131,745 | ||||||||||
| Billed tenant expense reimbursement |
16,700 | 18,230 | 15,795 | 15,309 | 14,160 | |||||||||||||||
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| Total rental revenue |
$ | 151,167 | $ | 151,458 | $ | 154,603 | $ | 140,091 | $ | 145,905 | ||||||||||
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The preceding table of the components of rental revenue is not, and is not intended to be, a presentation in accordance with GAAP. The Company believes this information is frequently used by management, investors, securities analysts and other interested parties to evaluate the Company’s performance.
Page 7
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Fourth Quarter 2023 Highlights (unaudited and dollars and shares in thousands, except per share amounts) |
| Three Months Ended | ||||||||||||||||||||
| December 31, 2023 |
September 30, 2023 |
June 30, 2023 |
March 31, 2023 |
December 31, 2022 |
||||||||||||||||
| Office and Retail Metrics: |
||||||||||||||||||||
| Total rentable square footage |
9,359,219 | 9,361,656 | 9,356,165 | 9,637,356 | 9,661,065 | |||||||||||||||
| Percent occupied (1) |
86.3 | % | 87.0 | % | 86.8 | % | 86.7 | % | 85.2 | % | ||||||||||
| Percent leased (2) |
90.6 | % | 90.5 | % | 90.3 | % | 89.4 | % | 88.6 | % | ||||||||||
| Same Store Property Cash Net Operating Income (NOI): |
||||||||||||||||||||
| Manhattan office portfolio |
$ | 66,897 | $ | 61,985 | $ | 62,800 | $ | 58,227 | $ | 61,913 | ||||||||||
| Greater New York office portfolio |
5,206 | 3,982 | 4,291 | 3,121 | 3,731 | |||||||||||||||
| Retail portfolio |
1,791 | 1,752 | 1,609 | 512 | 753 | |||||||||||||||
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| Total Same Store Property Cash NOI |
$ | 73,894 | $ | 67,719 | $ | 68,700 | $ | 61,860 | $ | 66,397 | ||||||||||
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| Multifamily Metrics: |
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| Multifamily Cash NOI (4) |
$ | 4,032 | $ | 4,837 | $ | 3,756 | $ | 3,499 | $ | 2,848 | ||||||||||
| Total number of units |
727 | 727 | 721 | 721 | 721 | |||||||||||||||
| Percent occupied |
98.1 | % | 97.1 | % | 97.4 | % | 97.2 | % | 96.3 | % | ||||||||||
| Observatory Metrics: |
||||||||||||||||||||
| Observatory NOI |
$ | 26,935 | $ | 28,091 | $ | 24,776 | $ | 14,299 | $ | 23,789 | ||||||||||
| Number of visitors (3) |
711,000 | 743,000 | 666,000 | 443,000 | 660,000 | |||||||||||||||
| Change in visitors year-over-year |
7.7 | % | 8.2 | % | 16.2 | % | 64.7 | % | 83.3 | % | ||||||||||
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| Ratios at ESRT pro-rata share: (4) |
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| Debt to Total Market Capitalization (5) |
45.2 | % | 49.7 | % | 51.4 | % | 54.8 | % | 54.0 | % | ||||||||||
| Net Debt to Total Market Capitalization (5) |
41.1 | % | 45.4 | % | 47.6 | % | 51.6 | % | 50.9 | % | ||||||||||
| Debt and Perpetual Preferred Units to Total Market Capitalization (5) |
47.0 | % | 51.7 | % | 53.5 | % | 56.9 | % | 56.1 | % | ||||||||||
| Net Debt and Perpetual Preferred Units to Total Market Capitalization (5) |
43.0 | % | 47.6 | % | 49.8 | % | 53.9 | % | 53.1 | % | ||||||||||
| Debt to Adjusted EBITDA (6) |
6.4x | 6.6x | 6.7x | 6.6x | 6.5x | |||||||||||||||
| Net Debt to Adjusted EBITDA (6) |
5.4x | 5.5x | 5.8x | 5.7x | 5.7x | |||||||||||||||
| Core FFO Payout Ratio (7) |
14 | % | 14 | % | 14 | % | 20 | % | 16 | % | ||||||||||
| Core FAD Payout Ratio (8) |
35 | % | 23 | % | 29 | % | 83 | % | 23 | % | ||||||||||
| Core FFO per share - diluted |
$ | 0.25 | $ | 0.25 | $ | 0.26 | $ | 0.16 | $ | 0.22 | ||||||||||
| Diluted weighted average shares |
267,003 | 266,073 | 264,196 | 265,197 | 265,370 | |||||||||||||||
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| Class A common stock price at quarter end |
$ | 9.69 | $ | 8.04 | $ | 7.49 | $ | 6.49 | $ | 6.74 | ||||||||||
| Dividends declared and paid per share |
$ | 0.035 | $ | 0.035 | $ | 0.035 | $ | 0.035 | $ | 0.035 | ||||||||||
| Dividends per share - annualized |
$ | 0.14 | $ | 0.14 | $ | 0.14 | $ | 0.14 | $ | 0.14 | ||||||||||
| Dividend yield (9) |
1.4 | % | 1.7 | % | 1.9 | % | 2.2 | % | 2.1 | % | ||||||||||
| Series 2013 Private Perpetual Preferred Units outstanding ($16.62 liquidation value) |
1,560 | 1,560 | 1,560 | 1,560 | 1,560 | |||||||||||||||
| Series 2019 Private Perpetual Preferred Units outstanding ($13.52 liquidation value) |
4,664 | 4,664 | 4,664 | 4,664 | 4,664 | |||||||||||||||
| Class A common stock |
162,062 | 161,346 | 159,843 | 160,340 | 160,140 | |||||||||||||||
| Class B common stock (10) |
984 | 987 | 988 | 989 | 990 | |||||||||||||||
| Operating partnership units |
107,900 | 108,618 | 110,087 | 110,618 | 109,905 | |||||||||||||||
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| Total common stock and operating partnership units outstanding (11) |
270,946 | 270,951 | 270,918 | 271,947 | 271,035 | |||||||||||||||
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Notes:
| (1) | Based on leases signed and commenced as of end of period. |
| (2) | Represents occupancy and includes signed leases not commenced. |
| (3) | Reflects the number of visitors who pass through the turnstile, excluding visitors who make a second visit on the same ticket at no additional charge. |
| (4) | Calculated to include ESRT’s pro-rata 90% share of NOI, debt, interest, EBITDA and FFO at its joint venture properties. |
| (5) | Market capitalization represents the sum of (i) Company’s common stock per share price as of December 31, 2023 multiplied by the total outstanding number of shares of common stock and operating partnership units as of December 31, 2023; (ii) the number of Series 2014 perpetual preferred units at December 31, 2023 multiplied by $16.62, (iii) the number of Series 2019 perpetual preferred units at December 31, 2023 multiplied by $13.52, and (iv) our outstanding indebtedness as of December 31, 2023. |
| (6) | Calculated based on trailing 12 months Adjusted EBITDA. |
| (7) | Represents the amount of Core FFO paid out in distributions. |
| (8) | Beginning in the three months ended December 31, 2023, we have eliminated a deduction of other non-recurring capital improvements from Core FFO to arrive at Core FAD and the related Core FAD Payout Ratio. We made this modification above to the calculation of Core FAD Payout Ratio for the other periods presented; in our previous supplemental reports prior to this change, the Core FAD Payout Ratios were 27%, 33%, 97%, and 23% for the three months ended September 30, 2023, June 30, 2023, March 31, 2023, and December 31, 2022, respectively. |
| (9) | Based on the closing price per share of Class A common stock on December 31, 2023. |
| (10) | We have two classes of common stock as a means to give our OP Unit holders voting rights in the public company that correspond to their economic interest in the combined entity. A one-time option was created at our formation transactions for any pre-IPO OP Unit holder to exchange one OP Unit out of every 50 OP Units they owned for one Class B share, and such Class B share carries 50 votes to the extent such holder continues to hold 49 OP units for every Class B share. |
| (11) | Represents fully diluted common stock and operating partnership units as it includes unvested restricted stock and unvested LTIP units. |
Page 8
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Fourth Quarter 2023 Property Summary - Same Store (1) Net Operating Income (“NOI”) by Quarter (unaudited and dollars in thousands) |
| Twelve Months Ended |
Three Months Ended | |||||||||||||||||||||||
| December 31, 2023 |
December 31, 2023 |
September 30, 2023 |
June 30, 2023 |
March 31, 2023 |
December 31, 2022 |
|||||||||||||||||||
| Same Store Portfolio |
||||||||||||||||||||||||
| Revenues |
$ | 570,559 | $ | 146,857 | $ | 144,331 | $ | 147,806 | $ | 131,565 | $ | 138,097 | ||||||||||||
| Operating expenses |
(284,765 | ) | (72,397 | ) | (73,074 | ) | (68,653 | ) | (70,641 | ) | (67,132 | ) | ||||||||||||
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| Same store property NOI |
285,794 | 74,460 | 71,257 | 79,153 | 60,924 | 70,965 | ||||||||||||||||||
| Straight-line rent |
(18,960 | ) | (1,990 | ) | (4,900 | ) | (11,742 | ) | (328 | ) | (5,896 | ) | ||||||||||||
| Above/below-market rent revenue amortization |
(2,492 | ) | (534 | ) | (595 | ) | (669 | ) | (694 | ) | (630 | ) | ||||||||||||
| Below-market ground lease amortization |
7,831 | 1,958 | 1,957 | 1,958 | 1,958 | 1,958 | ||||||||||||||||||
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| Total same store property cash NOI - excluding lease termination fees |
$ | 272,173 | $ | 73,894 | $ | 67,719 | $ | 68,700 | $ | 61,860 | $ | 66,397 | ||||||||||||
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| Percent change over prior year |
2.2 | % | 11.3 | % | 8.8 | % | 1.1 | % | (11.4 | )% | (3.3 | )% | ||||||||||||
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| Property cash NOI |
$ | 272,173 | $ | 73,894 | $ | 67,719 | $ | 68,700 | $ | 61,860 | $ | 66,397 | ||||||||||||
| Lease termination fees |
— | — | — | — | — | — | ||||||||||||||||||
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| Total same store property cash NOI |
$ | 272,173 | $ | 73,894 | $ | 67,719 | $ | 68,700 | $ | 61,860 | $ | 66,397 | ||||||||||||
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| Same Store Manhattan Office(2) |
||||||||||||||||||||||||
| Revenues |
$ | 517,516 | $ | 133,207 | $ | 130,888 | $ | 133,986 | $ | 119,435 | $ | 125,014 | ||||||||||||
| Operating expenses |
(257,353 | ) | (65,750 | ) | (66,294 | ) | (61,601 | ) | (63,708 | ) | (60,332 | ) | ||||||||||||
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| Same store property NOI |
260,163 | 67,457 | 64,594 | 72,385 | 55,727 | 64,682 | ||||||||||||||||||
| Straight-line rent |
(15,593 | ) | (1,984 | ) | (3,971 | ) | (10,874 | ) | 1,236 | (4,097 | ) | |||||||||||||
| Above/below-market rent revenue amortization |
(2,492 | ) | (534 | ) | (595 | ) | (669 | ) | (694 | ) | (630 | ) | ||||||||||||
| Below-market ground lease amortization |
7,831 | 1,958 | 1,957 | 1,958 | 1,958 | 1,958 | ||||||||||||||||||
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| Total same store property cash NOI - excluding lease termination fees |
249,909 | 66,897 | 61,985 | 62,800 | 58,227 | 61,913 | ||||||||||||||||||
| Lease termination fees |
— | — | — | — | — | — | ||||||||||||||||||
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| Total same store property cash NOI |
$ | 249,909 | $ | 66,897 | $ | 61,985 | $ | 62,800 | $ | 58,227 | $ | 61,913 | ||||||||||||
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| Same Store Greater New York Metropolitan Area Office |
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| Revenues |
$ | 40,370 | $ | 10,064 | $ | 9,902 | $ | 10,325 | $ | 10,079 | $ | 10,617 | ||||||||||||
| Operating expenses |
(20,917 | ) | (4,978 | ) | (5,127 | ) | (5,384 | ) | (5,428 | ) | (5,196 | ) | ||||||||||||
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| Same store property NOI |
19,453 | 5,086 | 4,775 | 4,941 | 4,651 | 5,421 | ||||||||||||||||||
| Straight-line rent |
(2,853 | ) | 120 | (793 | ) | (650 | ) | (1,530 | ) | (1,690 | ) | |||||||||||||
| Above/below-market rent revenue amortization |
— | — | — | — | — | — | ||||||||||||||||||
| Below-market ground lease amortization |
— | — | — | — | — | — | ||||||||||||||||||
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| Total same store property cash NOI - excluding lease termination fees |
16,600 | 5,206 | 3,982 | 4,291 | 3,121 | 3,731 | ||||||||||||||||||
| Lease termination fees |
— | — | — | — | — | — | ||||||||||||||||||
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| Total same store property cash NOI |
$ | 16,600 | $ | 5,206 | $ | 3,982 | $ | 4,291 | $ | 3,121 | $ | 3,731 | ||||||||||||
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| Same Store Retail |
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| Revenues |
$ | 12,673 | $ | 3,586 | $ | 3,541 | $ | 3,495 | $ | 2,051 | $ | 2,466 | ||||||||||||
| Operating expenses |
(6,495 | ) | (1,669 | ) | (1,653 | ) | (1,668 | ) | (1,505 | ) | (1,604 | ) | ||||||||||||
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|
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| Same store property NOI |
6,178 | 1,917 | 1,888 | 1,827 | 546 | 862 | ||||||||||||||||||
| Straight-line rent |
(514 | ) | (126 | ) | (136 | ) | (218 | ) | (34 | ) | (109 | ) | ||||||||||||
| Above/below-market rent revenue amortization |
— | — | — | — | — | — | ||||||||||||||||||
| Below-market ground lease amortization |
— | — | — | — | — | — | ||||||||||||||||||
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| Total same store property cash NOI - excluding lease termination fees |
5,664 | 1,791 | 1,752 | 1,609 | 512 | 753 | ||||||||||||||||||
| Lease termination fees |
— | — | — | — | — | — | ||||||||||||||||||
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| Total same store property cash NOI |
$ | 5,664 | $ | 1,791 | $ | 1,752 | $ | 1,609 | $ | 512 | $ | 753 | ||||||||||||
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Notes:
| (1) | Excludes 10 Bank Street, White Plains, NY, 69-97 and 103-107 Main Street, Westport, CT, and 500 Mamaroneck Ave, Harrison, NY, which were sold in December 2022, February 2023, and April 2023, respectively, Williamsburg retail in New York City, NY which was acquired in September 2023, and multifamily properties. |
| (2) | Includes 498,682 rentable square feet of retail space in the Company’s nine Manhattan office properties. |
Page 9
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|
Fourth Quarter 2023 Same Store Net Operating Income (“NOI”), Initial Cash Rent Contributing to Cash NOI (unaudited and dollars in thousands) |
| Twelve Months Ended |
Three Months Ended | |||||||||||||||||||||||
| December 31, 2023 |
December 31, 2023 |
September 30, 2023 |
June 30, 2023 |
March 31, 2023 |
December 31, 2022 |
|||||||||||||||||||
| Reconciliation of Net Income to Cash NOI and Same Store Cash NOI |
||||||||||||||||||||||||
| Net income |
$ | 84,407 | $ | 15,830 | $ | 19,928 | $ | 36,955 | $ | 11,694 | $ | 21,620 | ||||||||||||
| Add: |
||||||||||||||||||||||||
| General and administrative expenses |
63,939 | 16,144 | 16,012 | 16,075 | 15,708 | 16,478 | ||||||||||||||||||
| Depreciation and amortization |
189,911 | 49,599 | 46,624 | 46,280 | 47,408 | 44,500 | ||||||||||||||||||
| Interest expense |
101,484 | 25,393 | 25,382 | 25,405 | 25,304 | 25,634 | ||||||||||||||||||
| Income tax expense (benefit) |
2,715 | 1,792 | 1,409 | 733 | (1,219 | ) | 1,322 | |||||||||||||||||
| Less: |
||||||||||||||||||||||||
| (Gain) loss on disposition of property |
(26,764 | ) | 2,497 | — | (13,565 | ) | (15,696 | ) | (6,818 | ) | ||||||||||||||
| Third-party management and other fees |
(1,351 | ) | (275 | ) | (268 | ) | (381 | ) | (427 | ) | (336 | ) | ||||||||||||
| Interest income |
(15,136 | ) | (4,740 | ) | (4,462 | ) | (3,339 | ) | (2,595 | ) | (2,804 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Net operating income |
399,205 | 106,240 | 104,625 | 108,163 | 80,177 | 99,596 | ||||||||||||||||||
| Straight-line rent |
(19,563 | ) | (2,133 | ) | (5,015 | ) | (11,859 | ) | (556 | ) | (6,029 | ) | ||||||||||||
| Above/below-market rent revenue amortization |
(2,415 | ) | (483 | ) | (554 | ) | (675 | ) | (703 | ) | (622 | ) | ||||||||||||
| Below-market ground lease amortization |
7,831 | 1,958 | 1,957 | 1,958 | 1,958 | 1,958 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total cash NOI - including Observatory and lease termination fees |
385,058 | 105,582 | 101,013 | 97,587 | 80,876 | 94,903 | ||||||||||||||||||
| Less: Observatory NOI |
(94,101 | ) | (26,935 | ) | (28,091 | ) | (24,776 | ) | (14,299 | ) | (23,789 | ) | ||||||||||||
| Less: cash NOI from non-Same Store properties |
(18,784 | ) | (4,753 | ) | (5,203 | ) | (4,111 | ) | (4,717 | ) | (4,717 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total Same Store property cash NOI - including lease termination fees |
272,173 | 73,894 | 67,719 | 68,700 | 61,860 | 66,397 | ||||||||||||||||||
| Less: Lease termination fees |
— | — | — | — | — | — | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total Same Store property cash NOI - excluding Observatory and lease termination fees |
$ | 272,173 | $ | 73,894 | $ | 67,719 | $ | 68,700 | $ | 61,860 | $ | 66,397 | ||||||||||||
|
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|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Multifamily NOI(1) |
||||||||||||||||||||||||
| Revenues |
$ | 32,669 | $ | 8,345 | $ | 8,581 | $ | 8,119 | $ | 7,624 | $ | 6,251 | ||||||||||||
| Operating expenses |
(16,218 | ) | (4,268 | ) | (3,683 | ) | (4,254 | ) | (4,013 | ) | (3,345 | ) | ||||||||||||
|
|
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|
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|
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|
|
|
|||||||||||||
| NOI |
16,451 | 4,077 | 4,898 | 3,865 | 3,611 | 2,906 | ||||||||||||||||||
| Straight-line rent |
(408 | ) | (102 | ) | (103 | ) | (101 | ) | (102 | ) | (64 | ) | ||||||||||||
| Above/below-market rent revenue amortization |
81 | 57 | 42 | (8 | ) | (10 | ) | 6 | ||||||||||||||||
|
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|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Cash NOI |
$ | 16,124 | $ | 4,032 | $ | 4,837 | $ | 3,756 | $ | 3,499 | $ | 2,848 | ||||||||||||
|
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|
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|
|
|
|
|
|
|
|||||||||||||
Initial Cash Rent Contributing to Cash NOI in the Following Years From Burn-off of Free Rent and Signed Leases not Commenced
| Square Feet |
Initial Annual Cash Rent |
Initial Cash Rent Contributing to Cash NOI in the Following Years |
||||||||||||||||||||||||||
| Expected Cash Commencement |
2024 | 2025 | 2026 | 2027 | 2028 | |||||||||||||||||||||||
| First quarter 2024 |
314,994 | $ | 17,360 | $ | 15,533 | $ | 15,895 | $ | 15,443 | $ | 14,733 | $ | 11,748 | |||||||||||||||
| Second quarter 2024 |
192,860 | 14,241 | 9,432 | 14,241 | 14,241 | 14,241 | 14,241 | |||||||||||||||||||||
| Third quarter 2024 |
41,056 | 2,672 | 954 | 2,672 | 2,672 | 2,672 | 2,672 | |||||||||||||||||||||
| Fourth quarter 2024 |
81,756 | 3,577 | 819 | 3,577 | 3,577 | 3,577 | 3,516 | |||||||||||||||||||||
| First quarter 2025 |
36,590 | 2,491 | — | 2,251 | 2,491 | 2,491 | 2,491 | |||||||||||||||||||||
| Second quarter 2025 |
154,756 | 9,321 | — | 6,128 | 9,321 | 9,321 | 9,321 | |||||||||||||||||||||
| Third quarter 2025 |
19,671 | 1,274 | — | 587 | 1,274 | 1,274 | 1,274 | |||||||||||||||||||||
| Fourth quarter 2025 |
21,262 | 1,318 | — | 330 | 1,318 | 1,318 | 1,318 | |||||||||||||||||||||
| First quarter 2027 |
52,116 | 3,231 | — | — | — | 3,152 | 3,231 | |||||||||||||||||||||
| First quarter 2028 |
25,132 | 1,785 | — | — | — | — | 1,784 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| 940,193 | $ | 57,270 | $ | 26,738 | $ | 45,681 | $ | 50,337 | $ | 52,779 | $ | 51,596 | ||||||||||||||||
|
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|
|
|
|
|
|
|
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|
|
|
|||||||||||||||
| Incremental Annual |
Initial Annual |
Initial Cash Rent Contributing to Cash NOI in the Following Years |
||||||||||||||||||||||||||
| 4Q 2023 |
Cash Rent (2) | Cash Rent | 2024 | 2025 | 2026 | 2027 | 2028 | |||||||||||||||||||||
| Commenced leases in free rent period |
$ | 25,418 | $ | 29,246 | $ | 21,871 | $ | 27,738 | $ | 27,328 | $ | 26,619 | $ | 23,572 | ||||||||||||||
| Signed leases not commenced |
25,264 | 28,024 | 4,867 | 17,943 | 23,009 | 26,160 | 28,024 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| $ | 50,682 | $ | 57,270 | $ | 26,738 | $ | 45,681 | $ | 50,337 | $ | 52,779 | $ | 51,596 | |||||||||||||||
|
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|
|
|
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|
|||||||||||||||
Notes:
| (1) | Calculated to include ESRT’s pro-rata 90% share at its joint venture properties. |
| (2) | Reflects initial annual cash rent less annual cash rent from existing tenant in the space. |
Page 10
|
|
Fourth Quarter 2023 Property Summary - Leasing Activity by Quarter (unaudited) |
| Three Months Ended | ||||||||||||||||||||
| December 31, 2023 |
September 30, 2023 |
June 30, 2023 |
March 31, 2023 |
December 31, 2022 |
||||||||||||||||
| Total Office and Retail Portfolio |
||||||||||||||||||||
| Total leases executed |
19 | 21 | 31 | 19 | 29 | |||||||||||||||
| Weighted average lease term |
11.1 years | 8.6 years | 7.9 years | 9.1 years | 5 years | |||||||||||||||
| Average free rent period |
13.5 months | 10.5 months | 7.2 months | 8.6 months | 4.6 months | |||||||||||||||
| Office |
||||||||||||||||||||
| Total square footage executed |
156,444 | 245,292 | 326,150 | 201,145 | 142,828 | |||||||||||||||
| Average starting cash rent psf - leases executed |
$ | 63.40 | $ | 66.71 | $ | 64.27 | $ | 57.11 | $ | 55.46 | ||||||||||
| Previously escalated cash rents psf |
$ | 59.93 | $ | 60.28 | $ | 56.20 | $ | 54.89 | $ | 55.10 | ||||||||||
| Percentage of new cash rent over previously escalated rents |
5.8 | % | 10.7 | % | 14.4 | % | 4.1 | % | 0.7 | % | ||||||||||
| Retail |
||||||||||||||||||||
| Total square footage executed |
7,452 | 3,187 | 10,164 | 912 | 1,498 | |||||||||||||||
| Average starting cash rent psf - leases executed |
$ | 189.20 | $ | 169.44 | $ | 122.70 | $ | 39.47 | $ | 262.60 | ||||||||||
| Previously escalated cash rents psf |
$ | 288.16 | $ | 169.31 | $ | 178.14 | $ | 65.79 | $ | 416.07 | ||||||||||
| Percentage of new cash rent over previously escalated rents |
(34.3 | %) | 0.1 | % | (31.1 | %) | (40.0 | %) | (36.9 | %) | ||||||||||
| Total Office and Retail Portfolio |
||||||||||||||||||||
| Total square footage executed |
163,896 | 248,479 | 336,314 | 202,057 | 144,326 | |||||||||||||||
| Average starting cash rent psf - leases executed |
$ | 69.98 | $ | 68.03 | $ | 66.10 | $ | 57.03 | $ | 57.66 | ||||||||||
| Previously escalated cash rents psf |
$ | 71.87 | $ | 61.68 | $ | 60.03 | $ | 54.94 | $ | 58.93 | ||||||||||
| Percentage of new cash rent over previously escalated rents |
(2.6 | %) | 10.3 | % | 10.1 | % | 3.8 | % | (2.2 | %) | ||||||||||
| Leasing commission costs per square foot |
$ | 28.52 | $ | 19.53 | $ | 17.34 | $ | 20.90 | $ | 13.60 | ||||||||||
| Tenant improvement costs per square foot |
$ | 96.54 | 91.09 | 64.40 | 83.02 | 41.12 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total LC and TI per square foot (1) |
$ | 125.06 | $ | 110.62 | $ | 81.74 | $ | 103.92 | $ | 54.72 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Occupancy |
86.3 | % | 87.0 | % | 86.8 | % | 86.7 | % | 85.2 | % | ||||||||||
| Manhattan Office Portfolio |
||||||||||||||||||||
| Total leases executed |
14 | 18 | 25 | 15 | 22 | |||||||||||||||
| Office - New Leases |
||||||||||||||||||||
| Total square footage executed |
96,341 | 78,305 | 156,949 | 168,335 | 75,182 | |||||||||||||||
| Average starting cash rent psf - leases executed |
$ | 62.26 | $ | 65.59 | $ | 66.35 | $ | 57.42 | $ | 62.95 | ||||||||||
| Previously escalated cash rents psf |
$ | 59.54 | $ | 59.89 | $ | 48.93 | $ | 54.71 | $ | 58.78 | ||||||||||
| Percentage of new cash rent over previously escalated rents |
4.6 | % | 9.5 | % | 35.6 | % | 4.9 | % | 7.1 | % | ||||||||||
| Office - Renewal Leases |
||||||||||||||||||||
| Total square footage executed |
38,676 | 157,133 | 151,361 | 14,929 | 17,658 | |||||||||||||||
| Average starting cash rent psf - leases executed |
$ | 66.23 | $ | 68.79 | $ | 62.55 | $ | 62.44 | $ | 63.87 | ||||||||||
| Previously escalated cash rents psf |
$ | 60.91 | $ | 61.68 | $ | 63.79 | $ | 63.90 | $ | 65.80 | ||||||||||
| Percentage of new cash rent over previously escalated rents |
8.7 | % | 11.5 | % | (1.9 | %) | (2.3 | %) | (2.9 | %) | ||||||||||
| Total Manhattan Office Portfolio |
||||||||||||||||||||
| Total square footage executed |
135,017 | 235,438 | 308,310 | 183,264 | 92,840 | |||||||||||||||
| Average starting cash rent psf - leases executed |
$ | 63.40 | $ | 67.73 | $ | 64.48 | $ | 57.83 | $ | 63.12 | ||||||||||
| Previously escalated cash rents psf |
$ | 59.93 | $ | 61.08 | $ | 56.23 | $ | 55.46 | $ | 60.11 | ||||||||||
| Percentage of new cash rent over previously escalated rents |
5.8 | % | 10.9 | % | 14.7 | % | 4.3 | % | 5.0 | % | ||||||||||
| Leasing commission costs per square foot |
$ | 28.27 | $ | 18.54 | $ | 17.02 | $ | 21.88 | $ | 15.54 | ||||||||||
| Tenant improvement costs per square foot |
103.30 | 93.00 | 64.58 | 81.92 | 48.72 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total LC and TI per square foot (1) |
$ | 131.57 | $ | 111.54 | $ | 81.60 | $ | 103.80 | $ | 64.26 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Occupancy |
87.3 | % | 87.8 | % | 87.6 | % | 87.8 | % | 86.0 | % | ||||||||||
Page 11
|
|
Fourth Quarter 2023 Property Summary - Leasing Activity by Quarter - (Continued) (unaudited) |
| Three Months Ended | ||||||||||||||||||||
| December 31, 2023 |
September 30, 2023 |
June 30, 2023 |
March 31, 2023 |
December 31, 2022 |
||||||||||||||||
| Greater New York Metropolitan Area Office Portfolio |
||||||||||||||||||||
| Total leases executed |
2 | 2 | 3 | 3 | 5 | |||||||||||||||
| Total square footage executed |
21,427 | 9,854 | 17,840 | 17,881 | 49,988 | |||||||||||||||
| Average starting cash rent psf - leases executed |
N/A | (2) | $ | 42.53 | $ | 50.55 | $ | 43.98 | $ | 40.26 | ||||||||||
| Previously escalated cash rents psf |
N/A | (2) | $ | 41.00 | $ | 54.38 | $ | 44.33 | $ | 45.15 | ||||||||||
| Percentage of new cash rent over previously escalated rents |
N/A | (2) | 3.7 | % | (7.1 | %) | (0.8 | %) | (10.8 | %) | ||||||||||
| Leasing commission costs per square foot |
$ | 16.38 | $ | 9.35 | $ | 16.48 | $ | 11.86 | $ | 6.31 | ||||||||||
| Tenant improvement costs per square foot |
80.55 | 34.49 | 81.70 | 98.47 | 25.53 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total LC and TI per square foot (1) |
$ | 96.93 | $ | 43.84 | $ | 98.18 | $ | 110.33 | $ | 31.84 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Occupancy |
76.6 | % | 79.3 | % | 79.2 | % | 80.6 | % | 80.2 | % | ||||||||||
| Retail Portfolio |
||||||||||||||||||||
| Total leases executed |
3 | 1 | 3 | 1 | 2 | |||||||||||||||
| Total square footage executed |
7,452 | 3,187 | 10,164 | 912 | 1,498 | |||||||||||||||
| Average starting cash rent psf - leases executed |
$ | 189.20 | $ | 169.44 | $ | 122.70 | $ | 39.47 | $ | 262.60 | ||||||||||
| Previously escalated cash rents psf |
$ | 288.16 | $ | 169.31 | $ | 178.14 | $ | 65.79 | $ | 416.07 | ||||||||||
| Percentage of new cash rent over previously escalated rents |
(34.3 | %) | 0.1 | % | (31.1 | %) | (40.0 | %) | (36.9 | %) | ||||||||||
| Leasing commission costs per square foot |
$ | 67.66 | $ | 123.73 | $ | 28.28 | $ | — | $ | 136.80 | ||||||||||
| Tenant improvement costs per square foot |
20.18 | 125.00 | 28.40 | — | 90.32 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total LC and TI per square foot (1) |
$ | 87.84 | $ | 248.73 | $ | 56.68 | $ | — | $ | 227.12 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Occupancy |
90.4 | % | 90.4 | % | 90.7 | % | 86.7 | % | 86.5 | % | ||||||||||
| Multifamily Portfolio |
||||||||||||||||||||
| Percent occupied |
98.1 | % | 97.1 | % | 97.4 | % | 97.2 | % | 96.3 | % | ||||||||||
| Total number of units |
727 | 727 | 721 | 721 | 721 | |||||||||||||||
Notes:
| (1) | Presents all tenant improvement and leasing commission costs as if they were incurred in the period in which the lease was signed, which may be different than the period in which they were actually paid. |
| (2) | Leases on spaces that have been vacant for more than two years are not included in the calculation of leasing spreads. The average starting cash rent psf for these two leases was $42.06. |
Page 12
|
|
Fourth Quarter 2023 Commercial Property Detail (unaudited) |
| Property Name |
Location or Sub-Market |
Rentable Square Feet (1) |
Percent Occupied (2) |
Percent Leased (3) |
Annualized Rent (4) |
Annualized Rent per Occupied Square Foot (5) |
Number of Leases (6) |
|||||||||||||||||||
| Office - Manhattan | ||||||||||||||||||||||||||
| The Empire State Building |
Penn Station -Times Sq. South | 2,713,783 | 84.6 | % | 91.8 | % | $ | 149,146,291 | $ | 64.98 | 144 | |||||||||||||||
| One Grand Central Place |
Grand Central | 1,241,235 | 85.2 | % | 90.7 | % | 64,495,396 | 61.01 | 148 | |||||||||||||||||
| 1400 Broadway (7) |
Penn Station -Times Sq. South | 917,281 | 100.0 | % | 100.0 | % | 51,543,523 | 56.19 | 20 | |||||||||||||||||
| 111 West 33rd Street (8) |
Penn Station -Times Sq. South | 639,496 | 94.2 | % | 95.7 | % | 40,779,657 | 67.68 | 21 | |||||||||||||||||
| 250 West 57th Street |
Columbus Circle - West Side | 472,707 | 80.6 | % | 84.5 | % | 23,990,288 | 62.98 | 28 | |||||||||||||||||
| 501 Seventh Avenue |
Penn Station -Times Sq. South | 461,209 | 88.4 | % | 88.4 | % | 20,432,035 | 50.09 | 19 | |||||||||||||||||
| 1359 Broadway |
Penn Station -Times Sq. South | 456,004 | 83.5 | % | 91.4 | % | 22,376,656 | 58.75 | 32 | |||||||||||||||||
| 1350 Broadway (9) |
Penn Station -Times Sq. South | 372,599 | 85.5 | % | 86.4 | % | 19,076,631 | 59.90 | 50 | |||||||||||||||||
| 1333 Broadway |
Penn Station -Times Sq. South | 296,349 | 84.4 | % | 94.4 | % | 14,545,148 | 58.12 | 13 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Office - Manhattan |
7,570,663 | 87.3 | % | 92.1 | % | 406,385,625 | 61.47 | 475 | ||||||||||||||||||
| Office - Greater New York Metropolitan Area | ||||||||||||||||||||||||||
| First Stamford Place (10) |
Stamford, CT | 781,731 | 78.7 | % | 82.3 | % | 26,691,177 | 43.38 | 48 | |||||||||||||||||
| Metro Center |
Stamford, CT | 281,510 | 70.9 | % | 70.9 | % | 10,914,848 | 54.71 | 20 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Office - Greater New York Metropolitan Area |
1,063,241 | 76.6 | % | 79.3 | % | 37,606,025 | 46.15 | 68 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total/Weighted Average Office Properties |
8,633,904 | 86.0 | % | 90.5 | % | 443,991,650 | 59.79 | 543 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Retail Properties | ||||||||||||||||||||||||||
| 112 West 34th Street (8) |
Penn Station -Times Sq. South | 93,057 | 100.0 | % | 100.0 | % | 24,825,569 | 266.78 | 4 | |||||||||||||||||
| The Empire State Building |
Penn Station -Times Sq. South | 90,670 | 71.9 | % | 76.4 | % | 7,032,389 | 107.93 | 10 | |||||||||||||||||
| One Grand Central Place |
Grand Central | 68,733 | 99.4 | % | 99.4 | % | 8,977,805 | 131.41 | 12 | |||||||||||||||||
| 1333 Broadway |
Penn Station -Times Sq. South | 67,001 | 100.0 | % | 100.0 | % | 10,155,485 | 151.57 | 4 | |||||||||||||||||
| 250 West 57th Street |
Columbus Circle - West Side | 65,526 | 91.4 | % | 91.4 | % | 9,111,860 | 152.07 | 7 | |||||||||||||||||
| 10 Union Square |
Union Square | 58,006 | 91.9 | % | 91.9 | % | 8,181,304 | 153.49 | 10 | |||||||||||||||||
| 1542 Third Avenue |
Upper East Side | 56,135 | 100.0 | % | 100.0 | % | 2,542,042 | 45.28 | 4 | |||||||||||||||||
| 1010 Third Avenue |
Upper East Side | 38,235 | 100.0 | % | 100.0 | % | 3,460,188 | 90.50 | 2 | |||||||||||||||||
| 501 Seventh Avenue |
Penn Station -Times Sq. South | 35,859 | 50.8 | % | 59.6 | % | 1,310,333 | 71.94 | 5 | |||||||||||||||||
| 1350 Broadway (9) |
Penn Station -Times Sq. South | 30,710 | 77.8 | % | 77.8 | % | 5,962,833 | 249.70 | 5 | |||||||||||||||||
| 1359 Broadway |
Penn Station -Times Sq. South | 29,247 | 83.0 | % | 100.0 | % | 1,668,652 | 68.73 | 5 | |||||||||||||||||
| 561 10th Avenue |
Hudson Yards | 28,266 | 100.0 | % | 100.0 | % | 2,007,748 | 71.03 | 3 | |||||||||||||||||
| 77 West 55th Street |
Midtown | 25,388 | 100.0 | % | 100.0 | % | 1,978,407 | 77.93 | 3 | |||||||||||||||||
| 1400 Broadway (7) |
Penn Station -Times Sq. South | 17,879 | 78.2 | % | 78.2 | % | 1,538,836 | 110.07 | 6 | |||||||||||||||||
| 298 Mulberry Street |
NoHo | 10,365 | 100.0 | % | 100.0 | % | 1,802,507 | 173.90 | 1 | |||||||||||||||||
| Williamsburg Retail |
Brooklyn | 6,538 | 100.0 | % | 100.0 | % | 1,158,422 | 177.18 | 3 | |||||||||||||||||
| 345 East 94th Street |
Upper East Side | 3,700 | 100.0 | % | 100.0 | % | 263,134 | 71.12 | 1 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total/Weighted Average Retail Properties |
725,315 | 90.4 | % | 92.1 | % | 91,977,514 | 140.27 | 85 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Portfolio Total |
9,359,219 | 86.3 | % | 90.6 | % | $ | 535,969,164 | $ | 66.32 | 628 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Notes:
| (1) | Excludes (i) 189,148 square feet of space across the Company’s portfolio attributable to building management use and tenant amenities and (ii) 83,190 square feet of space attributable to the Company’s Observatory. |
| (2) | Based on leases signed and commenced as of December 31, 2023. |
| (3) | Includes occupied space plus leases signed but not commenced as of December 31, 2023. |
| (4) | Represents annualized base rent and current reimbursement for operating expenses and real estate taxes. |
| (5) | Represents annualized rent under leases commenced as of December 31, 2023 divided by occupied square feet. |
| (6) | Represents the number of leases at each property or on a portfolio basis. If a tenant has more than one lease, whether or not at the same property, but with different expirations, the number of leases is calculated equal to the number of leases with different expirations. |
| (7) | Denotes a ground leasehold interest in the property with a remaining term, including unilateral extension rights available to the Company, of approximately 40 years (expiring December 31, 2063). |
| (8) | Denotes a ground leasehold interest in the property with a remaining term, including unilateral extension rights available to the Company, of approximately 54 years (expiring May 31, 2077). |
| (9) | Denotes a ground leasehold interest in the property with a remaining term, including unilateral extension rights available to the Company, of approximately 27 years (expiring July 31, 2050). |
| (10) | First Stamford Place consists of three buildings. |
Page 13
|
|
Fourth Quarter 2023 Total Portfolio Expirations and Vacates Summary (unaudited and in square feet) |
| Actual | Forecast (1) | |||||||||||||||||||||||||||
| Three Months Ended | Three Months Ended | |||||||||||||||||||||||||||
| December 31, 2023 |
March 31, 2024 |
June 30, 2024 |
September 30, 2024 |
December 31, 2024 |
Full Year 2024 |
Full Year 2025 |
||||||||||||||||||||||
| Total Office and Retail Portfolio (2) |
||||||||||||||||||||||||||||
| Total expirations |
205,619 | 188,726 | 114,707 | 125,180 | 150,609 | 579,222 | 594,946 | |||||||||||||||||||||
| Less: broadcasting |
— | (906 | ) | — | (511 | ) | — | (1,417 | ) | — | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Office and retail expirations |
205,619 | 187,820 | 114,707 | 124,669 | 150,609 | 577,805 | 594,946 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Renewals & relocations (3) |
51,704 | 80,714 | 34,787 | 32,024 | 43,464 | 190,989 | 87,685 | |||||||||||||||||||||
| New leases (4) |
50,828 | 25,651 | 4,115 | 2,998 | 6,738 | 39,502 | 119,226 | |||||||||||||||||||||
| Vacates (5) |
103,087 | 72,064 | 72,271 | 75,649 | 52,219 | 272,203 | 139,521 | |||||||||||||||||||||
| Unknown (6) |
— | 9,391 | 3,534 | 13,998 | 48,188 | 75,111 | 248,514 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total Office and Retail Portfolio expirations and vacates |
205,619 | 187,820 | 114,707 | 124,669 | 150,609 | 577,805 | 594,946 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Manhattan Office Portfolio | ||||||||||||||||||||||||||||
| Total expirations |
186,007 | 150,009 | 114,707 | 103,587 | 130,047 | 498,350 | 495,292 | |||||||||||||||||||||
| Less: broadcasting |
— | (906 | ) | — | (511 | ) | — | (1,417 | ) | — | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Office expirations |
186,007 | 149,103 | 114,707 | 103,076 | 130,047 | 496,933 | 495,292 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Renewals & relocations (3) |
34,632 | 65,235 | 34,787 | 21,728 | 43,464 | 165,214 | 57,630 | |||||||||||||||||||||
| New leases (4) |
50,828 | 25,651 | 4,115 | 2,998 | 6,738 | 39,502 | 119,226 | |||||||||||||||||||||
| Vacates (5) |
100,547 | 52,347 | 72,271 | 64,352 | 41,690 | 230,660 | 106,311 | |||||||||||||||||||||
| Unknown (6) |
— | 5,870 | 3,534 | 13,998 | 38,155 | 61,557 | 212,125 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total expirations and vacates |
186,007 | 149,103 | 114,707 | 103,076 | 130,047 | 496,933 | 495,292 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Greater New York Metropolitan Area Office Portfolio |
| |||||||||||||||||||||||||||
| Office expirations |
3,168 | 14,017 | — | 20,689 | 20,562 | 55,268 | 76,903 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Renewals & relocations (3) |
628 | 8,628 | — | 9,805 | — | 18,433 | 23,777 | |||||||||||||||||||||
| New leases (4) |
— | — | — | — | — | — | — | |||||||||||||||||||||
| Vacates (5) |
2,540 | 2,540 | — | 10,884 | 10,529 | 23,953 | 16,737 | |||||||||||||||||||||
| Unknown (6) |
— | 2,849 | — | — | 10,033 | 12,882 | 36,389 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total expirations and vacates |
3,168 | 14,017 | — | 20,689 | 20,562 | 55,268 | 76,903 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Retail Portfolio | ||||||||||||||||||||||||||||
| Retail expirations |
16,444 | 24,700 | — | 904 | — | 25,604 | 22,751 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Renewals & relocations (3) |
16,444 | 6,851 | — | 491 | — | 7,342 | 6,278 | |||||||||||||||||||||
| New leases (4) |
— | — | — | — | — | — | — | |||||||||||||||||||||
| Vacates (5) |
— | 17,177 | — | 413 | — | 17,590 | 16,473 | |||||||||||||||||||||
| Unknown (6) |
— | 672 | — | — | — | 672 | — | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total expirations and vacates |
16,444 | 24,700 | — | 904 | — | 25,604 | 22,751 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Notes:
| (1) | These forecasts, which are subject to change, are based on management’s current expectations, including, among other things, discussions with and other information provided by tenants as well as management’s analyses of past historical trends. |
| (2) | Any lease on month to month or short-term will re-appear in “Actual” in each period until tenant has vacated or renewed, and thus it would be double counted if periods were cumulated. “Forecast” avoids double counting. |
| (3) | For forecasted periods, “Renewals & relocations” includes the following: tenants renew their existing leases in all or a portion of their current spaces; tenants which signed renewal leases for a term of less than six months and reappear in forecast periods in 2024; and tenants who move within a building or within the Company’s portfolio. |
| (4) | For forecasted periods, “New Leases” represents leases that have been signed with a new tenant, a subtenant who signed a direct lease or a tenant who expanded. There may be downtime between the lease expiration and the new lease commencement. |
| (5) | For forecasted periods, “Vacates” assumes a tenant elects not to renew at the end of their existing lease or exercises an early termination option; leases that the Company decides not to renew at the end of tenants’ existing lease due to anticipated future redevelopment or for other reasons. This also may include early lease terminations. |
| (6) | For forecasted periods, “Unknown” represents tenants whose intentions are unknown. |
Page 14
|
|
Fourth Quarter 2023 Tenant Lease Expirations (unaudited) |
| Percent of | ||||||||||||||||||||||||
| Rentable | Portfolio | Annualized | ||||||||||||||||||||||
| Number | Square | Rentable | Percent of | Rent Per | ||||||||||||||||||||
| of Leases | Feet | Square Feet | Annualized | Annualized | Rentable | |||||||||||||||||||
| Expiring (1) | Expiring (2) | Expiring | Rent (3) | Rent | Square Foot | |||||||||||||||||||
| Total Office and Retail Lease Expirations |
||||||||||||||||||||||||
| Available |
— | 875,777 | 9.4 | % | $ | — | 0.0 | % | $ | — | ||||||||||||||
| Signed leases not commenced |
28 | 402,268 | 4.3 | % | — | 0.0 | % | — | ||||||||||||||||
| 4Q 2023 (4) |
15 | 143,627 | 1.5 | % | 7,522,786 | 1.4 | % | 52.38 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total 2023 |
15 | 143,627 | 1.5 | % | 7,522,786 | 1.4 | % | 52.38 | ||||||||||||||||
| 1Q 2024 |
21 | 119,175 | 1.3 | % | 8,359,089 | 1.6 | % | 70.14 | ||||||||||||||||
| 2Q 2024 |
13 | 114,707 | 1.2 | % | 5,798,621 | 1.1 | % | 50.55 | ||||||||||||||||
| 3Q 2024 |
17 | 125,180 | 1.3 | % | 7,181,398 | 1.3 | % | 57.37 | ||||||||||||||||
| 4Q 2024 |
38 | 150,609 | 1.6 | % | 8,736,094 | 1.6 | % | 58.01 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total 2024 |
89 | 509,671 | 5.4 | % | 30,075,202 | 5.6 | % | 59.01 | ||||||||||||||||
| 2025 |
85 | 594,946 | 6.4 | % | 40,363,625 | 7.5 | % | 67.84 | ||||||||||||||||
| 2026 |
72 | 628,943 | 6.7 | % | 37,384,704 | 7.0 | % | 59.44 | ||||||||||||||||
| 2027 |
87 | 713,569 | 7.6 | % | 47,192,095 | 8.8 | % | 66.14 | ||||||||||||||||
| 2028 |
63 | 945,077 | 10.1 | % | 52,486,474 | 9.8 | % | 55.54 | ||||||||||||||||
| 2029 |
50 | 981,952 | 10.5 | % | 73,521,837 | 13.7 | % | 74.87 | ||||||||||||||||
| 2030 |
38 | 745,546 | 8.0 | % | 50,024,340 | 9.3 | % | 67.10 | ||||||||||||||||
| 2031 |
23 | 174,491 | 1.9 | % | 20,214,026 | 3.8 | % | 115.85 | ||||||||||||||||
| 2032 |
29 | 368,694 | 3.9 | % | 26,223,606 | 4.9 | % | 71.13 | ||||||||||||||||
| 2033 |
29 | 329,711 | 3.5 | % | 21,332,708 | 4.0 | % | 64.70 | ||||||||||||||||
| Thereafter |
48 | 1,944,947 | 20.8 | % | 129,627,761 | 24.2 | % | 66.65 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total |
656 | 9,359,219 | 100.0 | % | $ | 535,969,164 | 100.0 | % | $ | 66.32 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Manhattan Office Properties (5) | ||||||||||||||||||||||||
| Available |
— | 597,862 | 7.9 | % | $ | — | 0.0 | % | $ | — | ||||||||||||||
| Signed leases not commenced |
20 | 362,213 | 4.8 | % | — | 0.0 | % | |||||||||||||||||
| 4Q 2023 (4) |
12 | 124,643 | 1.6 | % | 7,044,490 | 1.7 | % | 56.52 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total 2023 |
12 | 124,643 | 1.6 | % | 7,044,490 | 1.7 | % | 56.52 | ||||||||||||||||
| 1Q 2024 |
14 | 82,998 | 1.1 | % | 5,229,107 | 1.3 | % | 63.00 | ||||||||||||||||
| 2Q 2024 |
13 | 114,707 | 1.5 | % | 5,798,621 | 1.4 | % | 50.55 | ||||||||||||||||
| 3Q 2024 |
13 | 103,587 | 1.4 | % | 6,394,857 | 1.6 | % | 61.73 | ||||||||||||||||
| 4Q 2024 |
36 | 130,047 | 1.7 | % | 7,781,812 | 1.9 | % | 59.84 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total 2024 |
76 | 431,339 | 5.7 | % | 25,204,397 | 6.2 | % | 58.43 | ||||||||||||||||
| 2025 |
67 | 495,292 | 6.5 | % | 32,205,906 | 7.9 | % | 65.02 | ||||||||||||||||
| 2026 |
57 | 485,929 | 6.4 | % | 29,511,170 | 7.3 | % | 60.73 | ||||||||||||||||
| 2027 |
71 | 600,450 | 7.9 | % | 36,782,006 | 9.1 | % | 61.26 | ||||||||||||||||
| 2028 |
47 | 854,943 | 11.3 | % | 47,465,773 | 11.7 | % | 55.52 | ||||||||||||||||
| 2029 |
35 | 738,291 | 9.8 | % | 44,821,337 | 11.0 | % | 60.71 | ||||||||||||||||
| 2030 |
27 | 599,150 | 7.9 | % | 37,243,747 | 9.2 | % | 62.16 | ||||||||||||||||
| 2031 |
12 | 86,541 | 1.1 | % | 6,076,449 | 1.5 | % | 70.21 | ||||||||||||||||
| 2032 |
21 | 334,698 | 4.4 | % | 23,105,190 | 5.7 | % | 69.03 | ||||||||||||||||
| 2033 |
15 | 141,599 | 1.9 | % | 8,587,282 | 2.1 | % | 60.65 | ||||||||||||||||
| Thereafter |
35 | 1,717,713 | 22.8 | % | 108,337,878 | 26.6 | % | 63.07 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total Manhattan office properties |
495 | 7,570,663 | 100.0 | % | $ | 406,385,625 | 100.0 | % | $ | 61.47 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Page 15
|
|
Fourth Quarter 2023 Tenant Lease Expirations (unaudited) |
| Percent of | ||||||||||||||||||||||||
| Rentable | Portfolio | Annualized | ||||||||||||||||||||||
| Number | Square | Rentable | Percent of | Rent Per | ||||||||||||||||||||
| of Leases | Feet | Square Feet | Annualized | Annualized | Rentable | |||||||||||||||||||
| Expiring (1) | Expiring (2) | Expiring | Rent (3) | Rent | Square Foot | |||||||||||||||||||
| Greater New York Metropolitan Area Office Properties |
||||||||||||||||||||||||
| Available |
— | 220,593 | 20.7 | % | $ | — | 0.0 | % | $ | — | ||||||||||||||
| Signed leases not commenced |
3 | 27,802 | 2.5 | % | — | 0.0 | % | — | ||||||||||||||||
| 4Q 2023 (4) |
2 | 2,540 | 0.2 | % | 63,701 | 0.2 | % | 25.08 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total 2023 |
2 | 2,540 | 0.2 | % | 63,701 | 0.2 | % | 25.08 | ||||||||||||||||
| 1Q 2024 |
3 | 11,477 | 1.1 | % | 547,643 | 1.5 | % | 47.72 | ||||||||||||||||
| 2Q 2024 |
— | — | 0.0 | % | — | 0.0 | % | — | ||||||||||||||||
| 3Q 2024 |
2 | 20,689 | 1.9 | % | 721,050 | 1.9 | % | 34.85 | ||||||||||||||||
| 4Q 2024 |
2 | 20,562 | 1.9 | % | 954,282 | 2.5 | % | 46.41 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total 2024 |
7 | 52,728 | 5.0 | % | 2,222,975 | 5.9 | % | 42.16 | ||||||||||||||||
| 2025 |
13 | 76,903 | 7.2 | % | 3,597,773 | 9.6 | % | 46.78 | ||||||||||||||||
| 2026 |
8 | 71,784 | 6.8 | % | 3,508,404 | 9.3 | % | 48.87 | ||||||||||||||||
| 2027 |
10 | 58,730 | 5.5 | % | 2,801,695 | 7.5 | % | 47.70 | ||||||||||||||||
| 2028 |
11 | 84,915 | 8.0 | % | 3,735,230 | 9.9 | % | 43.99 | ||||||||||||||||
| 2029 |
5 | 128,271 | 12.1 | % | 5,907,668 | 15.7 | % | 46.06 | ||||||||||||||||
| 2030 |
4 | 78,033 | 7.3 | % | 3,562,425 | 9.5 | % | 45.65 | ||||||||||||||||
| 2031 |
2 | 16,560 | 1.6 | % | 843,885 | 2.2 | % | 50.96 | ||||||||||||||||
| 2032(6) |
1 | — | 0.0 | % | 6,180 | 0.0 | % | — | ||||||||||||||||
| 2033 |
3 | 151,754 | 14.3 | % | 7,494,005 | 19.9 | % | 49.38 | ||||||||||||||||
| Thereafter |
2 | 92,628 | 8.8 | % | 3,862,084 | 10.3 | % | 41.69 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total greater New York metropolitan area office properties |
71 | 1,063,241 | 100.0 | % | $ | 37,606,025 | 100.0 | % | $ | 46.15 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Retail Properties | ||||||||||||||||||||||||
| Available |
— | 57,322 | 7.9 | % | $ | — | 0.0 | % | $ | — | ||||||||||||||
| Signed leases not commenced |
5 | 12,253 | 1.7 | % | — | 0.0 | % | — | ||||||||||||||||
| 4Q 2023 (4) |
1 | 16,444 | 2.3 | % | 414,595 | 0.5 | % | 25.21 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total 2023 |
1 | 16,444 | 2.3 | % | 414,595 | 0.5 | % | 25.21 | ||||||||||||||||
| 1Q 2024 |
4 | 24,700 | 3.4 | % | 2,582,339 | 2.8 | % | 104.55 | ||||||||||||||||
| 2Q 2024 |
— | — | 0.0 | % | — | 0.0 | % | — | ||||||||||||||||
| 3Q 2024 |
2 | 904 | 0.1 | % | 65,491 | 0.1 | % | 72.45 | ||||||||||||||||
| 4Q 2024 |
— | — | 0.0 | % | — | 0.0 | % | — | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total 2024 |
6 | 25,604 | 3.5 | % | 2,647,830 | 2.9 | % | 103.41 | ||||||||||||||||
| 2025 |
5 | 22,751 | 3.1 | % | 4,559,946 | 5.0 | % | 200.43 | ||||||||||||||||
| 2026 |
7 | 71,230 | 9.8 | % | 4,365,130 | 4.7 | % | 61.28 | ||||||||||||||||
| 2027 |
6 | 54,389 | 7.5 | % | 7,608,394 | 8.3 | % | 139.89 | ||||||||||||||||
| 2028 |
5 | 5,219 | 0.7 | % | 1,285,471 | 1.4 | % | 246.31 | ||||||||||||||||
| 2029 |
10 | 115,390 | 15.9 | % | 22,792,832 | 24.8 | % | 197.53 | ||||||||||||||||
| 2030 |
7 | 68,363 | 9.4 | % | 9,218,168 | 10.0 | % | 134.84 | ||||||||||||||||
| 2031 |
9 | 71,390 | 9.8 | % | 13,293,692 | 14.5 | % | 186.21 | ||||||||||||||||
| 2032 |
7 | 33,996 | 4.7 | % | 3,112,236 | 3.4 | % | 91.55 | ||||||||||||||||
| 2033 |
11 | 36,358 | 5.0 | % | 5,251,421 | 5.7 | % | 144.44 | ||||||||||||||||
| Thereafter |
11 | 134,606 | 18.7 | % | 17,427,798 | 18.8 | % | 129.47 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total retail properties |
90 | 725,315 | 100.0 | % | $ | 91,977,514 | 100.0 | % | $ | 140.27 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Notes:
| (1) | If a tenant has more than one lease, whether or not at the same property, but with different expirations, the number of leases is calculated equal to the number of leases with different expirations. |
| (2) | Excludes (i) 189,148 square feet of space across the Company’s portfolio attributable to building management use and tenant amenities and (ii) 83,190 square feet of space attributable to the Company’s Observatory. |
| (3) | Represents annualized base rent and current reimbursement for operating expenses and real estate taxes. |
| (4) | Represents leases that are included in occupancy as of December 31, 2023 and expire on December 31, 2023. |
| (5) | Excludes (i) retail space in the Manhattan office and (ii) the Empire State Building broadcasting licenses and Observatory operations. |
| (6) | Represents a telecom lease with no square footage. |
Page 16
|
|
Fourth Quarter 2023 20 Largest Tenants and Portfolio Tenant Diversification by Industry (unaudited) |
| Weighted | Percent of | |||||||||||||||||||||||||
| Average | Total | Portfolio | Percent of | |||||||||||||||||||||||
| Remaining | Occupied | Rentable | Portfolio | |||||||||||||||||||||||
| Lease | Lease | Square | Square | Annualized | Annualized | |||||||||||||||||||||
| 20 Largest Tenants |
Property |
Expiration (1) | Term(2) | Feet (3) | Feet (4) | Rent (5) | Rent (6) | |||||||||||||||||||
| 1. LinkedIn |
Empire State Building | Aug. 2036 | 12.7 years | 501,409 | 5.4 | % | $ | 33,465,435 | 6.2 | % | ||||||||||||||||
| 2. Flagstar Bank |
1400 Broadway | Aug. 2039 | 15.7 years | 313,109 | 3.3 | % | 18,285,046 | 3.4 | % | |||||||||||||||||
| 3. Centric Brands Inc. |
Empire State Building | Oct. 2028 | 4.8 years | 221,365 | 2.4 | % | 11,952,833 | 2.2 | % | |||||||||||||||||
| 4. PVH Corp. |
501 Seventh Avenue | Oct. 2028 | 4.8 years | 237,281 | 2.5 | % | 11,519,383 | 2.1 | % | |||||||||||||||||
| 5. Sephora |
112 West 34th Street | Jan. 2029 | 5.1 years | 11,334 | 0.1 | % | 10,533,585 | 2.0 | % | |||||||||||||||||
| 6. Target |
112 West 34th St., 10 Union Sq. | Jan. 2038 | 14.1 years | 81,340 | 0.9 | % | 9,341,224 | 1.7 | % | |||||||||||||||||
| 7. Coty Inc. |
Empire State Building | Jan. 2030 | 6.1 years | 156,187 | 1.7 | % | 8,497,458 | 1.6 | % | |||||||||||||||||
| 8. Macy’s |
111 West 33rd Street | May 2030 | 6.4 years | 131,117 | 1.4 | % | 8,451,562 | 1.6 | % | |||||||||||||||||
| 9. Urban Outfitters |
1333 Broadway | Sept. 2029 | 5.8 years | 56,730 | 0.6 | % | 8,185,595 | 1.5 | % | |||||||||||||||||
| 10. Li & Fung |
1359 Broadway, ESB | Oct. 2027 - Oct. 2028 | 4.5 years | 149,061 | 1.6 | % | 7,954,806 | 1.5 | % | |||||||||||||||||
| 11. Footlocker |
112 West 34th Street | Sept. 2031 | 7.8 years | 34,192 | 0.4 | % | 7,745,828 | 1.4 | % | |||||||||||||||||
| 12. Federal Deposit Insurance Corp. |
Empire State Building | Dec. 2025 | 2.0 years | 119,226 | 1.3 | % | 7,578,004 | 1.4 | % | |||||||||||||||||
| 13. HNTB Corporation |
Empire State Building | Feb. 2029 | 5.2 years | 105,143 | 1.1 | % | 7,000,733 | 1.3 | % | |||||||||||||||||
| 14. Institutional Capital Network, Inc. |
One Grand Central Place | Feb. 2024 - Oct. 2035 | 10.6 years | 94,331 | 1.0 | % | 6,351,680 | 1.2 | % | |||||||||||||||||
| 15. The Michael J. Fox Foundation |
111 West 33rd Street | Nov. 2029 | 5.9 years | 86,492 | 0.9 | % | 6,267,495 | 1.2 | % | |||||||||||||||||
| 16. Shutterstock |
Empire State Building | Apr. 2029 | 5.3 years | 104,386 | 1.1 | % | 6,096,096 | 1.1 | % | |||||||||||||||||
| 17. Fragomen |
1400 Broadway | Feb. 2035 | 11.2 years | 107,680 | 1.2 | % | 5,959,656 | 1.1 | % | |||||||||||||||||
| 18. Burlington Merchandising Corp. |
1400 Broadway | Jan. 2038 | 14.1 years | 102,898 | 1.1 | % | 5,932,832 | 1.1 | % | |||||||||||||||||
| 19. ASCAP |
250 West 57th Street | Aug. 2034 | 10.7 years | 87,943 | 0.9 | % | 5,384,628 | 1.0 | % | |||||||||||||||||
| 20. Duane Reade |
ESB, 1350 Broadway | May 2025 - Sept. 2027 | 2.5 years | 39,142 | 0.4 | % | 4,941,165 | 0.9 | % | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
| Total |
2,740,366 | 29.3 | % | $ | 191,445,044 | 35.5 | % | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Notes:
| (1) | Expiration dates are per lease and do not assume exercise of renewal or extension options. For tenants with more than two leases, the lease expiration is shown as a range. |
| (2) | Represents the weighted average lease term based on annualized rent. |
| (3) | Based on leases signed and commenced as of December 31, 2023. |
| (4) | Represents the percentage of rentable square feet of the Company’s office and retail portfolios in the aggregate. |
| (5) | Represents annualized base rent and current reimbursement for operating expenses and real estate taxes. |
| (6) | Represents the percentage of annualized rent of the Company’s office and retail portfolios in the aggregate. |
Portfolio Tenant Diversification by Industry (based on annualized rent)
Page 17
|
|
Fourth Quarter 2023 Capital Expenditures and Redevelopment Program and Leasing Opportunity (unaudited and dollars in thousands) |
| Three Months Ended | ||||||||||||||||||||
| Capital expenditures | December 31, 2023 |
September 30, 2023 |
June 30, 2023 |
March 31, 2023 |
December 31, 2022 |
|||||||||||||||
| Tenant improvements - first generation |
$ | — | $ | — | $ | — | $ | — | $ | 6,024 | ||||||||||
| Tenant improvements - second generation |
28,817 | 18,047 | 19,823 | 23,919 | 8,867 | |||||||||||||||
| Leasing commissions - first generation |
125 | 203 | 98 | — | — | |||||||||||||||
| Leasing commissions - second generation |
5,706 | 2,319 | 4,370 | 4,114 | 4,721 | |||||||||||||||
| Building improvements - first generation |
— | — | — | — | 2,530 | |||||||||||||||
| Building improvements - second generation |
12,102 | 7,425 | 8,879 | 11,050 | 5,945 | |||||||||||||||
| Non-recurring capital improvements |
4,420 | 5,226 | 3,935 | 1,561 | 892 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total |
$ | 51,170 | $ | 33,220 | $ | 37,105 | $ | 40,644 | $ | 28,979 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Leasing Opportunity - Inventory of Current Vacant Space as of December 31, 2023 (in square feet) (1) |
||||
| Total Portfolio vacant space |
1,278,000 | |||
|
|
|
|||
| Signed leases not commenced (“SLNC”): |
||||
| Manhattan Office Properties SLNC |
362,000 | |||
| Greater New York Office Properties SLNC |
28,000 | |||
| Retail Properties SLNC |
12,000 | |||
| Greater New York Office Properties |
221,000 | |||
| Retail Properties |
57,000 | |||
| Manhattan Office Properties |
535,000 | |||
| Manhattan Office Properties off market |
20,000 | |||
| Manhattan Office Properties other |
43,000 | |||
|
|
|
|||
| Total |
1,278,000 | |||
|
|
|
|||
Notes:
| (1) | These estimates are based on the Company’s current budgets and are subject to change. |
Page 18
|
|
Fourth Quarter 2023 Observatory Summary (unaudited and dollars in thousands) |
| Three Months Ended | ||||||||||||||||||||||||
| Observatory NOI | Twelve Months to Date |
December 31, 2023 |
September 30, 2023 |
June 30, 2023 |
March 31, 2023 |
December 31, 2022 |
||||||||||||||||||
| Observatory revenue (1) |
$ | 129,366 | $ | 36,217 | $ | 37,562 | $ | 33,433 | $ | 22,154 | $ | 32,318 | ||||||||||||
| Observatory expenses |
35,265 | 9,282 | 9,471 | 8,657 | 7,855 | 8,529 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| NOI |
94,101 | 26,935 | 28,091 | 24,776 | 14,299 | 23,789 | ||||||||||||||||||
| Intercompany rent expense (2) |
80,514 | 21,545 | 22,113 | 20,942 | 15,914 | 18,204 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| NOI after intercompany rent |
$ | 13,587 | $ | 5,390 | $ | 5,978 | $ | 3,834 | $ | (1,615 | ) | $ | 5,585 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Observatory Metrics |
||||||||||||||||||||||||
| Number of visitors (3) |
711,000 | 743,000 | 666,000 | 443,000 | 660,000 | |||||||||||||||||||
| Change in visitors year over year |
7.7 | % | 8.2 | % | 16.2 | % | 64.7 | % | 83.3 | % | ||||||||||||||
| Number of bad weather days (“BWD”) (4) |
11 | 10 | 12 | 15 | 20 | |||||||||||||||||||
Notes:
| (1) | Observatory revenues include the fixed license fee received from WDFG North America, the Observatory gift shop operator. For the three months ended December 31, 2023, September 30, 2023, June 30, 2023, March 31, 2023, and December 31, 2022, the fixed license fee was $1,807, $1,807, $1,807, $1,807 and $1,200 respectively. |
| (2) | The Observatory pays a market-based rent payment comprised of fixed and percentage rent to the Empire State Building. Intercompany rent is eliminated upon consolidation. |
| (3) | Reflects the number of visitors who pass through the turnstile, excluding visitors who make a second visit on the same ticket at no additional charge. |
| (4) | The Company defines a bad weather day as one in which the top of the Empire State Building is obscured from view for more than 50% of the day. |
Annual Observatory NOI 2018 to 2023
Notes:
| (1) | The 102nd floor Observatory was closed for approximately nine months in 2019 for renovations. |
| (2) | Due to the COVID-19 pandemic, the Observatory was closed on March 16, 2020. The 86th floor Observatory reopened on July 20, 2020 and the 102nd floor Observatory reopened on August 24, 2020. |
| (3) | The Observatory continued to experience a gradual recovery in visitors due to the COVID-19 pandemic. |
Page 19
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|
Fourth Quarter 2023 Funds from Operations (“FFO”), Modified Funds From Operations (“Modified FFO”), Core Funds from Operations (“Core FFO”), Core Funds Available for Distribution (“Core FAD”) and EBITDA (unaudited and in thousands, except per share amounts) |
| Three Months Ended | ||||||||||||||||||||
| Reconciliation of Net Income to FFO, Modified FFO and Core FFO |
December 31, 2023 |
September 30, 2023 |
June 30, 2023 |
March 31, 2023 |
December 31, 2022 |
|||||||||||||||
| Net Income |
$ | 15,830 | $ | 19,928 | $ | 36,955 | $ | 11,694 | $ | 21,620 | ||||||||||
| Non-controlling interests in other partnerships |
1 | (111 | ) | (1 | ) | 43 | (28 | ) | ||||||||||||
| Preferred unit distributions |
(1,050 | ) | (1,050 | ) | (1,051 | ) | (1,050 | ) | (1,050 | ) | ||||||||||
| Real estate depreciation and amortization |
48,548 | 45,174 | 44,887 | 46,024 | 43,076 | |||||||||||||||
| (Gain) loss on sale of properties |
2,497 | — | (13,565 | ) | (15,696 | ) | (6,818 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| FFO attributable to common stockholders and the Operating Partnership |
65,826 | 63,941 | 67,225 | 41,015 | 56,800 | |||||||||||||||
| Amortization of below-market ground lease |
1,958 | 1,957 | 1,958 | 1,958 | 1,958 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Modified FFO attributable to common stockholders and the Operating Partnership |
67,784 | 65,898 | 69,183 | 42,973 | 58,758 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Core FFO attributable to common stockholders and the Operating Partnership |
$ | 67,784 | $ | 65,898 | $ | 69,183 | $ | 42,973 | $ | 58,758 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total weighted average shares and Operating Partnership units |
||||||||||||||||||||
| Basic |
262,775 | 262,756 | 262,903 | 264,493 | 263,759 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Diluted |
267,003 | 266,073 | 264,196 | 265,197 | 265,370 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| FFO attributable to common stockholders and the Operating Partnership per share and unit |
||||||||||||||||||||
| Basic |
$ | 0.25 | $ | 0.24 | $ | 0.26 | $ | 0.16 | $ | 0.22 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Diluted |
$ | 0.25 | $ | 0.24 | $ | 0.25 | $ | 0.15 | $ | 0.21 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Modified FFO attributable to common stockholders and the Operating Partnership per share and unit |
||||||||||||||||||||
| Basic |
$ | 0.26 | $ | 0.25 | $ | 0.26 | $ | 0.16 | $ | 0.22 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Diluted |
$ | 0.25 | $ | 0.25 | $ | 0.26 | $ | 0.16 | $ | 0.22 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Core FFO attributable to common stockholders and the Operating Partnership per share and unit |
||||||||||||||||||||
| Basic |
$ | 0.26 | $ | 0.25 | $ | 0.26 | $ | 0.16 | $ | 0.22 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Diluted |
$ | 0.25 | $ | 0.25 | $ | 0.26 | $ | 0.16 | $ | 0.22 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Reconciliation of Core FFO to Core FAD |
||||||||||||||||||||
| Core FFO |
$ | 67,784 | $ | 65,898 | $ | 69,183 | $ | 42,973 | $ | 58,758 | ||||||||||
| Add: |
||||||||||||||||||||
| Amortization of deferred financing costs |
1,075 | 1,089 | 1,088 | 1,089 | 1,096 | |||||||||||||||
| Non-real estate depreciation and amortization |
1,077 | 1,298 | 1,248 | 1,237 | 1,285 | |||||||||||||||
| Amortization of non-cash compensation expense |
5,294 | 4,989 | 5,369 | 4,375 | 5,412 | |||||||||||||||
| Amortization of loss on interest rate derivative |
1,527 | 1,527 | 1,527 | 1,527 | 1,525 | |||||||||||||||
| Deduct: |
||||||||||||||||||||
| Straight-line rental revenues, above/below market rent, and other non-cash adjustments |
(3,013 | ) | (5,569 | ) | (12,534 | ) | (1,259 | ) | (6,651 | ) | ||||||||||
| Corporate capital expenditures |
(71 | ) | (90 | ) | (225 | ) | (270 | ) | (162 | ) | ||||||||||
| Tenant improvements - second generation |
(28,817 | ) | (18,047 | ) | (19,823 | ) | (23,919 | ) | (8,867 | ) | ||||||||||
| Building improvements - second generation |
(12,102 | ) | (7,425 | ) | (8,879 | ) | (11,050 | ) | (5,945 | ) | ||||||||||
| Leasing commissions - second generation |
(5,706 | ) | (2,319 | ) | (4,370 | ) | (4,114 | ) | (4,721 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Core FAD (1) |
$ | 27,047 | $ | 41,351 | $ | 32,584 | $ | 10,589 | $ | 41,730 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Reconciliation of Net Income to EBITDA and Adjusted EBITDA |
||||||||||||||||||||
| Net income |
$ | 15,830 | $ | 19,928 | $ | 36,955 | $ | 11,694 | $ | 21,620 | ||||||||||
| Interest expense |
25,393 | 25,382 | 25,405 | 25,304 | 25,634 | |||||||||||||||
| Income tax expense (benefit) |
1,792 | 1,409 | 733 | (1,219 | ) | 1,322 | ||||||||||||||
| Depreciation and amortization |
49,599 | 46,624 | 46,280 | 47,408 | 44,500 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| EBITDA |
92,614 | 93,343 | 109,373 | 83,187 | 93,076 | |||||||||||||||
| (Gain) loss on sale of properties |
2,497 | — | (13,565 | ) | (15,696 | ) | (6,818 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Adjusted EBITDA |
$ | 95,111 | $ | 93,343 | $ | 95,808 | $ | 67,491 | $ | 86,258 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| (1) | Beginning in the three months ended December 31, 2023, we have eliminated a deduction of other non-recurring capital improvements from Core FFO to arrive at Core FAD and the related Core FAD payout ratio. We made this modification to the calculation of Core FAD for the other periods presented; in our previous supplemental reports prior to this change, Core FAD was $35,922, $28,551, $9,028, and $40,838 for the three months ended September 30, 2023, June 30, 2023, March 31, 2023, and December 31, 2022, respectively. |
Page 20
|
|
Fourth Quarter 2023 Debt Summary (unaudited and dollars in thousands) |
| December 31, 2023 | September 30, 2023 | |||||||||||||||||||||||||||||||
| ESRT | Weighted Average | ESRT | Weighted Average | |||||||||||||||||||||||||||||
| Pro-rata | Interest | Maturity | Pro-rata | Interest | Maturity | |||||||||||||||||||||||||||
| Debt Summary |
Balance | Share | Rate | (Years) | Balance | Share | Rate | (Years) | ||||||||||||||||||||||||
| Mortgage debt |
$ | 891,998 | $ | 873,887 | 3.77 | % | 6.0 | $ | 893,945 | $ | 875,775 | 3.77 | % | 6.3 | ||||||||||||||||||
| Senior unsecured notes |
975,000 | 975,000 | 4.05 | % | 6.2 | 975,000 | 975,000 | 4.05 | % | 6.4 | ||||||||||||||||||||||
| Unsecured term loan facilities (1) |
390,000 | 390,000 | 3.93 | % | 2.0 | 390,000 | 390,000 | 3.93 | % | 2.3 | ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Total fixed rate debt |
2,256,998 | 2,238,887 | 3.94 | % | 5.4 | 2,258,945 | 2,240,775 | 3.94 | % | 5.7 | ||||||||||||||||||||||
| Unsecured term loan facilities (2) |
— | — | — | — | — | — | — | — | ||||||||||||||||||||||||
| Unsecured revolving credit facilities |
— | — | — | 1.3 | — | — | — | 1.5 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Total variable rate debt |
— | — | — | 1.5 | — | — | — | 1.5 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Total debt |
2,256,998 | 2,238,887 | 3.94 | % | 5.4 | 2,258,945 | 2,240,775 | 3.94 | % | 5.7 | ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
| Deferred financing costs, net |
(9,488 | ) | (10,052 | ) | ||||||||||||||||||||||||||||
| Debt discount |
(6,964 | ) | (7,159 | ) | ||||||||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||||||||||
| Total |
$ | 2,240,546 | $ | 2,241,734 | ||||||||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||||||||||
| Available Capacity |
Facility | Outstanding at December 31, 2023 |
Letters of Credit |
Available Capacity |
||||||||||||
| Unsecured revolving credit facility (3) |
$ | 850,000 | $ | — | $ | — | $ | 850,000 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Covenant Summary |
Required | Current Quarter |
In Compliance |
|||||||||
| Maximum Total Leverage(4) |
< 60 | % | 31.5 | % | Yes | |||||||
| Maximum Secured Leverage (4) |
< 40 | % | 12.3 | % | Yes | |||||||
| Minimum Fixed Charge Coverage |
> 1.50x | 3.3x | Yes | |||||||||
| Minimum Unencumbered Interest Coverage |
> 1.75x | 5.7x | Yes | |||||||||
| Maximum Unsecured Leverage (4) |
< 60 | % | 23.4 | % | Yes | |||||||
Notes:
| (1) | SOFR is fixed at 2.562% for $175 million and 2.626% for $215 million under variable to fixed interest rate swap agreements, through debt maturity. |
| (2) | As of December 31, 2023, each of our unsecured term loan facilities are fixed under variable to fixed interest rate swap agreements. |
| (3) | The unsecured revolving credit and term loan facilities have an accordion feature allowing for an increase in maximum aggregate principal balance to $1.5 billion under certain circumstances. This unsecured revolving credit facility matures in March 2025 with two additional six-month extension options. |
| (4) | Represents the ratio of total indebtedness to total asset value as determined in accordance with the credit facility agreement. |
Page 21
|
|
Fourth Quarter 2023 Debt Detail (unaudited and dollars in thousands) |
| Stated Interest |
Effective Interest |
Principal | ESRT Pro-rata Share |
Maturity | ||||||||||||||||||||||
| Rate (%) |
Rate (%) (1) | Balance | Percent | Amount | Date | Amortization | ||||||||||||||||||||
| Metro Center |
3.59% | 3.67 | % | $ | 80,070 | 100 | % | $ | 80,070 | 11/5/2024 | 30 years | |||||||||||||||
| 10 Union Square |
3.70% | 3.97 | % | 50,000 | 100 | % | 50,000 | 4/1/2026 | Interest only | |||||||||||||||||
| 1542 Third Avenue |
4.29% | 4.53 | % | 30,000 | 100 | % | 30,000 | 5/1/2027 | Interest only | |||||||||||||||||
| First Stamford Place (2) |
4.28% | 4.73 | % | 175,860 | 100 | % | 175,860 | 7/1/2027 | |
5 years interest only; 30 years thereafter |
| |||||||||||||||
| 1010 Third Avenue & 77 West 55th St. |
4.01% | 4.21 | % | 34,958 | 100 | % | 34,958 | 1/5/2028 | 30 years | |||||||||||||||||
| 250 West 57th Street |
2.83% | 3.21 | % | 180,000 | 100 | % | 180,000 | 12/1/2030 | Interest only | |||||||||||||||||
| 1333 Broadway |
4.21% | 4.29 | % | 160,000 | 100 | % | 160,000 | 2/5/2033 | Interest only | |||||||||||||||||
| 345 East 94th Street - Series A |
70% of SOFR plus 0.95% | 3.56 | % | 43,600 | 90 | % | 39,240 | 11/1/2030 | Interest only | |||||||||||||||||
| 345 East 94th Street - Series B |
SOFR plus 2.24% | 3.56 | % | 7,209 | 90 | % | 6,488 | 11/1/2030 | 30 years | |||||||||||||||||
| 561 10th Avenue - Series A |
70% of SOFR plus 1.07% | 3.85 | % | 114,500 | 90 | % | 103,050 | 11/1/2033 | Interest only | |||||||||||||||||
| 561 10th Avenue - Series B |
SOFR plus 2.45% | 3.85 | % | 15,801 | 90 | % | 14,221 | 11/1/2033 | 30 years | |||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||||
| Total fixed rate mortgage debt |
891,998 | 873,887 | ||||||||||||||||||||||||
| Unsecured term loan facility |
SOFR plus 1.20% | 4.22 | % | 215,000 | 100 | % | 215,000 | 3/19/2025 | Interest only | |||||||||||||||||
| Unsecured revolving credit facility |
SOFR plus 1.30% | — | — | 100 | % | — | 3/31/2025 | Interest only | ||||||||||||||||||
| Unsecured term loan facility |
SOFR plus 1.50% | 4.51 | % | 175,000 | 100 | % | 175,000 | 12/31/2026 | Interest only | |||||||||||||||||
| Senior unsecured notes: |
||||||||||||||||||||||||||
| Series A |
3.93% | 3.96 | % | 100,000 | 100 | % | 100,000 | 3/27/2025 | Interest only | |||||||||||||||||
| Series B |
4.09% | 4.12 | % | 125,000 | 100 | % | 125,000 | 3/27/2027 | Interest only | |||||||||||||||||
| Series C |
4.18% | 4.21 | % | 125,000 | 100 | % | 125,000 | 3/27/2030 | Interest only | |||||||||||||||||
| Series D |
4.08% | 4.11 | % | 115,000 | 100 | % | 115,000 | 1/22/2028 | Interest only | |||||||||||||||||
| Series E |
4.26% | 4.27 | % | 160,000 | 100 | % | 160,000 | 3/22/2030 | Interest only | |||||||||||||||||
| Series F |
4.44% | 4.45 | % | 175,000 | 100 | % | 175,000 | 3/22/2033 | Interest only | |||||||||||||||||
| Series G |
3.61% | 4.89 | % | 100,000 | 100 | % | 100,000 | 3/17/2032 | Interest only | |||||||||||||||||
| Series H |
3.73% | 5.00 | % | 75,000 | 100 | % | 75,000 | 3/17/2035 | Interest only | |||||||||||||||||
|
|
|
|
|
|
|
|
||||||||||||||||||||
| Total / weighted average debt |
3.94% | 4.20 | % | 2,256,998 | $ | 2,238,887 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
||||||||||||||||||||
| Deferred financing costs, net |
(9,488 | ) | ||||||||||||||||||||||||
| Debt discount |
(6,964 | ) | ||||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||||
| Total |
$ | 2,240,546 | ||||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||||
Notes:
| (1) | The effective interest rate is composed of the stated interest rate, deferred financing cost amortization and interest associated with variable to fixed interest rate swap agreements. |
| (2) | Represents a $164 million mortgage loan bearing interest at 4.09% and a $11.9 million mortgage loan bearing interest at 6.25%. |
Page 22
|
|
Fourth Quarter 2023 Debt Maturities and Ground Lease Commitments (unaudited and dollars in thousands) |
| Year |
Maturities (1) | Amortization | Total | ESRT Pro-rata Share |
Percentage of Total Debt |
Weighted Average Interest Rate of Maturing Debt |
||||||||||||||||||
| 2024 |
$ | 77,675 | $ | 8,861 | $ | 86,536 | $ | 86,288 | 3.9 | % | 3.59 | % | ||||||||||||
| 2025 |
315,000 | 6,893 | 321,893 | 321,621 | 14.4 | % | 3.86 | % | ||||||||||||||||
| 2026 |
225,000 | 7,330 | 232,330 | 232,033 | 10.4 | % | 3.98 | % | ||||||||||||||||
| 2027 |
319,000 | 6,461 | 325,461 | 325,136 | 14.5 | % | 4.21 | % | ||||||||||||||||
| 2028 |
146,092 | 3,556 | 149,648 | 149,292 | 6.7 | % | 4.06 | % | ||||||||||||||||
| 2029 |
— | 3,988 | 3,988 | 3,589 | 0.2 | % | n/a | |||||||||||||||||
| 2030 |
508,600 | 4,413 | 513,013 | 508,212 | 22.7 | % | 3.67 | % | ||||||||||||||||
| 2031 |
— | 3,283 | 3,283 | 2,955 | 0.1 | % | n/a | |||||||||||||||||
| 2032 |
100,000 | 3,591 | 103,591 | 103,231 | 4.6 | % | 3.61 | % | ||||||||||||||||
| 2033 |
439,007 | 3,248 | 442,255 | 431,530 | 19.3 | % | 4.20 | % | ||||||||||||||||
| Thereafter |
75,000 | — | 75,000 | 75,000 | 3.2 | % | 3.73 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total debt |
$ | 2,205,374 | $ | 51,624 | 2,256,998 | $ | 2,238,887 | 100.0 | % | 3.94 | % | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Deferred financing costs, net |
(9,488 | ) | ||||||||||||||||||||||
| Debt discount |
(6,964 | ) | ||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||
| Total |
$ | 2,240,546 | ||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||
Debt Maturity Profile (2)
Ground Lease Commitments (3)
| Year |
1350 Broadway (4) |
1400 Broadway (5) |
111 West 33rd Street (6) |
Total | ||||||||||||
| 2024 |
$ | 108 | $ | 675 | $ | 735 | $ | 1,518 | ||||||||
| 2025 |
108 | 675 | 735 | 1,518 | ||||||||||||
| 2026 |
93 | 675 | 735 | 1,503 | ||||||||||||
| 2027 |
72 | 675 | 735 | 1,482 | ||||||||||||
| 2028 |
72 | 675 | 735 | 1,482 | ||||||||||||
| Thereafter |
1,584 | 23,625 | 35,586 | 60,795 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| $ | 2,037 | $ | 27,000 | $ | 39,261 | $ | 68,298 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
Notes:
| (1) | Assumes no extension options are exercised. |
| (2) | The table reflects ESRT’s pro-rata share of debt maturities. |
| (3) | There are no fair value market resets, no step-ups, and no escalations in the three ground lease commitments. |
| (4) | Expires July 31, 2050 with a remaining term, including unilateral extension rights available to the Company, of approximately 27 years. |
| (5) | Expires December 31, 2063 with a remaining term, including unilateral extension rights available to the Company, of approximately 40 years. |
| (6) | Expires May 31, 2077 with a remaining term, including unilateral extension rights available to the Company, of approximately 54 years. |
Page 23