Download PDF

1. Company Snapshot

1.a. Company Description

SL Green Realty Corp., an S&P 500 company and Manhattan's largest office landlord, is a fully integrated real estate investment trust, or REIT, that is focused primarily on acquiring, managing and maximizing value of Manhattan commercial properties.As of December 31, 2020, SL Green held interests in 88 buildings totaling 38.2 million square feet.This included ownership interests in 28.6 million square feet of Manhattan buildings and 8.7 million square feet securing debt and preferred equity investments.

Show Full description

1.b. Last Insights on SLG

SL Green Realty Corp.'s recent performance was negatively impacted by Asset Management One Co. Ltd. reducing its stake in the company by 2.0%, selling 2,029 shares during the quarter. This decrease in investor confidence may be attributed to the company's high debt and interest costs, as well as its exposure to the NYC market. Additionally, SL Green's pursuit of a gaming license resulted in transaction costs of $13.1 million, which may have affected its financials. The company's Q3 earnings revealed net income attributable to common stockholders of $0.34 per share, a significant decrease from the same period in 2024.

1.c. Company Highlights

2. SL Green Realty Corp. Delivers Strong Q2 2025 Earnings with Leasing Momentum and Profitable Investments

SL Green Realty Corp. reported a robust second-quarter 2025 performance, exceeding expectations with an EPS of $1.63 compared to the consensus estimate of $1.37. The company demonstrated strong operational execution, completing over 540,000 square feet of leasing and securing a pipeline of over 1 million square feet, with 80% of leases under 25,000 square feet. This activity underscores the company's ability to capitalize on a diverse tenant base, with half of the pipeline coming from financial services and the remainder from a mix of industries. SL Green also realized a significant profit of nearly $90 million from the sale of its mortgage position at 522 Fifth Avenue, highlighting its ability to generate substantial returns from its investment portfolio. Additionally, the sale of a 50% participation interest in its preferred equity position at 625 Madison Avenue yielded over $300 million in cash proceeds, further bolstering its liquidity. These achievements prompted the company to raise its earnings guidance by $0.40 at the midpoint, with FFO guidance increasing by 7.4%.

Publication Date: Jul -21

📋 Highlights
  • Leasing Volume: Completed over 540,000 square feet of leasing, with year-to-date total reaching 1.3 million square feet.
  • Profit on Investment: Realized a $90 million profit on a $130 million mortgage investment at 522 Fifth Avenue.
  • Fund Commitments: Secured over $500 million in fund commitments, exceeding $1 billion in total.
  • FFO Guidance: Increased FFO guidance range by 7.4% at the midpoint, driven by portfolio profits.
  • Leasing Pipeline: A diverse pipeline with over 1 million square feet, 80% of which are 25,000 square feet and under.

Portfolio Performance and Leasing Momentum

The company's leasing momentum remained strong, with year-to-date leasing reaching 1.3 million square feet. Management emphasized that the slight dip in occupancy during the quarter was not a concern, as the company's leasing volume remains among the best in the business. Occupancy is expected to reach 93.2% by year-end, supported by a diverse tenant base. The growth of AI and tech demand in Midtown South was a notable highlight, with two deals completed during the quarter and two more pending. This demand, coupled with limited supply, positions SL Green well to maintain its competitive edge in the New York City market.

Capital Recycling and Growth Prospects

SL Green's capital recycling strategy continues to yield strong results. The company announced over $500 million in new fund commitments, bringing its total to over $1 billion. These commitments, combined with the proceeds from asset sales, are expected to drive growth in 2025 and beyond. Management highlighted the potential for same-store NOI increases due to rising occupancy rates and the company's ability to generate real cash gains. Additionally, SL Green is actively pursuing multiple development site opportunities, which remain a high priority. The company also reaffirmed its $1 billion disposition plan for the year, with investment opportunities emerging in areas such as the Sixth Avenue and Third Avenue corridors.

Market Outlook and Valuation

SL Green's shares are currently trading at a P/E ratio of -339.24 and a P/B ratio of 1.06, reflecting the market's expectations for future growth. The company's dividend yield of 5.07% remains attractive, supported by its strong cash flow generation. Despite the high EV/EBITDA ratio of 23.01, the company's ability to deliver consistent profitability and its strategic positioning in a supply-constrained market suggest that its valuation is justified. Management's confidence in its guidance and the positive outlook for same-store NOI growth in 2026 further reinforce the stock's appeal. With a strong leasing pipeline and a solid balance sheet, SL Green is well-positioned to continue creating shareholder value in a favorable demand environment.

3. NewsRoom

Card image cap

Head-To-Head Contrast: Americold Realty Trust (NYSE:COLD) & SL Green Realty (NYSE:SLG)

Dec -01

Source: defenseworld.net

Card image cap

Stock Traders Buy High Volume of SL Green Realty Put Options (NYSE:SLG)

Nov -25

Source: defenseworld.net

Card image cap

SL Green Realty Corp. Announces Common Stock Dividend

Nov -19

Source: globenewswire.com

Card image cap

REIT Lessons That Could Save You Thousands

Nov -03

Source: seekingalpha.com

Card image cap

San Lorenzo Gold to Attend the 51st Annual New Orleans Investment Conference

Oct -30

Source: newsfilecorp.com

Card image cap

SL Green Realty Corporation $SLG Shares Sold by Asset Management One Co. Ltd.

Oct -29

Source: defenseworld.net

Card image cap

Why Office REITs Are A Likely Value Trap

Oct -28

Source: seekingalpha.com

Card image cap

SL Green Realty: Stock Price Ignores Progress

Oct -17

Source: seekingalpha.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.35%)

6. Segments

Real Estate

Expected Growth: 4.5%

Driven by NYC’s strong office market, SL Green Realty Corp’s commercial properties growth is fueled by rising demand and limited supply

Summit

Expected Growth: 3.5%

Driven by strong demand for office space in New York City, SL Green Realty Corp’s commercial property portfolio benefits from its prime locations

Debt and Preferred Equity

Expected Growth: 4.5%

SL Green Realty Corp’s debt and preferred equity investments driven by strong property market, increasing demand for office and residential spaces

7. Detailed Products

Office Buildings

SL Green Realty Corp. owns and manages a portfolio of office buildings in New York City, providing commercial spaces for businesses to operate.

Retail Properties

SL Green Realty Corp. also owns and operates a range of retail properties, including shopping centers, restaurants, and other retail spaces.

Development Services

SL Green Realty Corp. offers development services, including construction, renovation, and redevelopment of properties.

Property Management

SL Green Realty Corp. provides property management services, including leasing, marketing, and maintenance of properties.

Investment and Financing

SL Green Realty Corp. offers investment and financing solutions for real estate projects and acquisitions.

8. SL Green Realty Corp.'s Porter Forces

Forces Ranking

Threat Of Substitutes

SL Green Realty Corp. operates in the real estate industry, where substitutes are limited. The company's focus on commercial properties in New York City reduces the threat of substitutes, as tenants have limited alternatives for high-quality office and retail space.

Bargaining Power Of Customers

While SL Green Realty Corp. has a diverse tenant base, some large tenants may have significant bargaining power due to their size and lease terms. However, the company's strong market position and high-quality properties mitigate this risk.

Bargaining Power Of Suppliers

SL Green Realty Corp. has a strong market position, which reduces the bargaining power of suppliers. The company can negotiate favorable terms with contractors, architects, and other suppliers due to its scale and reputation.

Threat Of New Entrants

The barriers to entry in the New York City commercial real estate market are high, making it difficult for new entrants to compete with established players like SL Green Realty Corp. The company's strong brand, extensive network, and significant resources deter new entrants.

Intensity Of Rivalry

The New York City commercial real estate market is highly competitive, with several large and well-established players competing for tenants and properties. SL Green Realty Corp. faces intense rivalry from companies like Vornado Realty Trust, Boston Properties, and Related Companies, which can lead to downward pressure on rents and upward pressure on property prices.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 53.38%
Debt Cost 4.05%
Equity Weight 46.62%
Equity Cost 12.44%
WACC 7.96%
Leverage 114.51%

11. Quality Control: SL Green Realty Corp. 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

Stock-Card
COPT Defense

A-Score: 6.1/10

Value: 4.2

Growth: 4.8

Quality: 5.7

Yield: 8.0

Momentum: 4.0

Volatility: 10.0

1-Year Total Return ->

View Full Report
Stock-Card
Alexandria Real Estate Equities

A-Score: 5.8/10

Value: 7.9

Growth: 4.4

Quality: 6.1

Yield: 9.0

Momentum: 1.5

Volatility: 6.0

1-Year Total Return ->

View Full Report
Stock-Card
Vornado Realty

A-Score: 5.2/10

Value: 5.4

Growth: 2.2

Quality: 6.6

Yield: 6.0

Momentum: 5.5

Volatility: 5.7

1-Year Total Return ->

View Full Report
Stock-Card
Douglas Emmett

A-Score: 4.9/10

Value: 4.3

Growth: 4.6

Quality: 3.7

Yield: 8.0

Momentum: 3.0

Volatility: 6.0

1-Year Total Return ->

View Full Report
Stock-Card
Boston Properties

A-Score: 4.8/10

Value: 3.3

Growth: 3.1

Quality: 3.8

Yield: 8.0

Momentum: 4.0

Volatility: 6.7

1-Year Total Return ->

View Full Report
Stock-Card
SL Green Realty

A-Score: 4.1/10

Value: 2.1

Growth: 0.9

Quality: 3.5

Yield: 9.0

Momentum: 3.5

Volatility: 5.3

1-Year Total Return ->

View Full Report

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

42.59$

Current Price

42.59$

Potential

-0.00%

Expected Cash-Flows