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1. Company Snapshot

1.a. Company Description

Empire State Realty OP, L.P. operates as a subsidiary of Empire State Realty Trust, Inc.

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1.b. Last Insights on FISK

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1.c. Company Highlights

2. ESRT's Q3 Results: Strong Leasing and Revenue Growth

Empire State Realty Trust (ESRT) reported core FFO of $0.23 per diluted share for the third quarter of 2025, with same-store property cash NOI increasing 1.1% year-over-year after adjustment for nonrecurring items. The company's Manhattan office portfolio remains highly leased, at over 93% leased for the 11th consecutive quarter. Revenue growth is supported by a strong leasing platform, with 88,000 square feet of new and renewal leases signed in Q3, and an additional 50,000 square feet signed post-quarter end.

Publication Date: Nov -13

📋 Highlights
  • FFO Beat Consensus: Core FFO of $0.23 per share, exceeding expectations with reaffirmed 2025 guidance.
  • High Occupancy: Manhattan office portfolio at 93% leased (11th consecutive quarter above 90%), with 500,000 sq ft vacancy.
  • Leasing Momentum: 88,000 sq ft signed in Q3; 150,000 sq ft in negotiation post-quarter, including 50,000 sq ft closed after reporting.
  • Rental Growth: Residential portfolio achieved 9.3% year-over-year net effective rent growth, driven by occupancy gains.

Leasing and Occupancy Trends

ESRT's leasing activity remains robust, with approximately 150,000 square feet of leases in negotiation. The company's Manhattan office occupancy increased 80 basis points sequentially to 90.3%, and is on track to achieve year-end commercial occupancy guidance of 89% to 91%. As Ryan Kass mentioned, "Tenant demand continues to be diversified, and we are in discussions with prospects from various industries such as finance, professional services, TAMI, consumer products and others."

Valuation and Growth Prospects

With a P/E Ratio of 26.0 and an EV/EBITDA of 9.5, ESRT's valuation multiples suggest a premium for its stable cash flows and growth prospects. The company's ROE of 4.53% and ROIC of 13.35% indicate a reasonable return on equity and invested capital. Analysts estimate next year's revenue growth at 0%, indicating a stable outlook.

Capital Allocation and Strategy

ESRT remains committed to disciplined growth and maintaining a strong balance sheet. The company has $300 million of share buybacks over the years and considers its share price "very attractive." Christina Chiu stated that the company is "positioned with good liquidity so that we can move quickly when the right deal comes up." The company's strategic priorities include leasing space, growing Observatory revenue, and advancing sustainability leadership.

3. NewsRoom

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Empire State Realty Trust (ESRT) Q2 2020 Earnings Call Transcript

Aug -01

Source: Yahoo

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Empire State Realty Trust (ESRT) Q2 FFO Top Estimates

Jul -30

Source: Yahoo

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3 Top Small-Cap Stocks to Buy Right Now

Jul -22

Source: Yahoo

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Will office buildings ever be the same? Empire State offers clues

Jun -29

Source: Yahoo

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3 Beaten-Down Stocks I'm Not Giving Up On

Jun -01

Source: Yahoo

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Empire State Realty Trust (ESRT) Catches Eye: Stock Jumps 7.2%

May -27

Source: Yahoo

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New York's Cuomo warns against 'blindly' reopening states

May -02

Source: AOL

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New York's Andrew Cuomo warns against 'blindly' reopening states

May -02

Source: ALJAZEERA

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (3.67%)

6. Segments

Real Estate

Expected Growth: 3.5%

Growing demand for office spaces in New York metropolitan area, increasing tourism driving foot traffic to the iconic Empire State Building, and strategic acquisitions of 17 other properties drive growth for Empire State Realty OP, L.P.

Observatory

Expected Growth: 4.5%

Growing tourism in New York City, increasing popularity of iconic landmarks, and unique panoramic views drive growth for The Observatory, with a forecast CAGR of 4.5% from 2023 to 2028.

7. Detailed Products

Office Space Leasing

Empire State Realty OP, L.P. offers premium office space leasing services to businesses of all sizes, providing flexible and customizable leasing options to meet the unique needs of each tenant.

Retail Space Leasing

The company provides retail space leasing opportunities in iconic locations, including the Empire State Building, to retailers seeking high-visibility and high-traffic locations.

Observation Deck Tickets

Empire State Realty OP, L.P. operates the iconic Empire State Building's observation decks, offering breathtaking 360-degree views of the city to visitors from around the world.

Broadcasting and Telecommunications Services

The company provides broadcasting and telecommunications services, including antenna and transmission services, to media and telecommunications companies.

Property Management Services

Empire State Realty OP, L.P. offers comprehensive property management services, including maintenance, repairs, and capital improvements, to ensure the optimal operation of its properties.

8. Empire State Realty OP, L.P.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Empire State Realty OP, L.P. is medium due to the availability of alternative properties and investment options for tenants and investors.

Bargaining Power Of Customers

The bargaining power of customers for Empire State Realty OP, L.P. is low due to the company's strong brand and limited alternatives for tenants.

Bargaining Power Of Suppliers

The bargaining power of suppliers for Empire State Realty OP, L.P. is medium due to the company's dependence on a few large contractors and suppliers.

Threat Of New Entrants

The threat of new entrants for Empire State Realty OP, L.P. is low due to the high barriers to entry in the real estate industry and the company's established market position.

Intensity Of Rivalry

The intensity of rivalry for Empire State Realty OP, L.P. is high due to the competitive nature of the real estate industry and the presence of several established players.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 69.45%
Debt Cost 4.97%
Equity Weight 30.55%
Equity Cost 10.71%
WACC 6.72%
Leverage 227.35%

11. Quality Control: Empire State Realty OP, L.P. passed 1 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Piedmont Office Realty Trust

A-Score: 5.4/10

Value: 7.5

Growth: 2.2

Quality: 4.9

Yield: 8.0

Momentum: 3.5

Volatility: 6.0

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Brandywine Realty

A-Score: 5.0/10

Value: 6.8

Growth: 1.8

Quality: 4.5

Yield: 10.0

Momentum: 1.5

Volatility: 5.7

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New York City REIT

A-Score: 4.4/10

Value: 9.4

Growth: 3.3

Quality: 2.6

Yield: 0.0

Momentum: 8.5

Volatility: 2.3

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Empire State Realty OP

A-Score: 4.0/10

Value: 5.7

Growth: 4.4

Quality: 4.4

Yield: 3.0

Momentum: 2.5

Volatility: 4.3

1-Year Total Return ->

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Office Properties Income Trust

A-Score: 3.8/10

Value: 8.2

Growth: 0.8

Quality: 4.0

Yield: 10.0

Momentum: 0.0

Volatility: 0.0

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Creative Media & Community Trust

A-Score: 2.2/10

Value: 8.5

Growth: 0.8

Quality: 1.8

Yield: 2.0

Momentum: 0.0

Volatility: 0.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

6.5$

Current Price

6.5$

Potential

-0.00%

Expected Cash-Flows