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TheStreet Open House

SL Green Realty Corp. Reports Third Quarter 2012 FFO Of $1.14 Per Share Before Transaction Costs And EPS Of $0.09 Per Share

SL Green Realty Corp. (NYSE: SLG):

Financial and Operating Highlights

  • Third quarter FFO of $1.14 per diluted share before transaction related costs of $0.02 per diluted share compared to prior year FFO of $1.01 per diluted share before transaction related costs of $0.01 per diluted share.
  • Third quarter net income attributable to common stockholders of $0.09 per diluted share compared to prior year net income of $0.08 per diluted share.
  • Combined same-store cash NOI increased 4.7 percent for the quarter compared to the prior year, an increase of $7.7 million.
  • Signed 60 Manhattan leases totaling 471,267 square feet during the third quarter. The mark-to-market on office leases signed in Manhattan was 2.7 percent higher in the third quarter than the previously fully escalated rents on the same office spaces.
  • Completed the lease-up and repositioning of 100 Church Street, which is now 97.0 percent leased. The Company obtained ownership in the 1.0 million square foot building located in downtown Manhattan which was 58.7 percent vacant in January 2010. The latest lease was for 131,946 square feet to The City of New York.
  • Quarter-end occupancy of 93.3 percent in stabilized Manhattan same-store properties compared to 93.5 percent in the corresponding quarter in the prior year and 93.0 percent at December 31, 2011.
  • Signed 31 Suburban leases totaling 160,255 square feet during the third quarter. The mark-to-market on office leases signed in the Suburbs was 2.4 percent lower in the third quarter than the previously fully escalated rents on the same office spaces.
  • Quarter-end occupancy of 81.5 percent in the Suburban portfolio compared to 82.2 percent in the corresponding quarter in the prior year and 82.4 percent at June 30, 2012.

Investing Highlights

  • Acquired the 267,000 square foot office buildings located at 635-641 Sixth Avenue for $173.0 million, or $648 per square foot. Office occupancy at 641 Sixth Avenue is 100 percent and the 635 Sixth Avenue office space will be redeveloped in order to reposition it for high quality tenancy.
  • The Company, together with an affiliate of Blackstone Real Estate Partners VII, Gramercy Capital Corp. (NYSE: GKK) and Square Mile Capital Management LLC, formed a joint venture to recapitalize a 31-property, 4.5-million-square-foot office portfolio in southern California.
  • Formed a joint venture with Harel Insurance and Finance and the Naftali Group to develop a dormitory tower for Pace University at 33 Beekman Street in downtown Manhattan. The joint venture, in which the Company holds a 45.9 percent interest, acquired the development site for $31.2 million.
  • Closed on the sale of a 214,372 square foot office condominium at 3 Columbus Circle to Young & Rubicam for $143.6 million. This transaction was part of a 340,000 square foot commitment by Young & Rubicam, which included a lease for 124,760 square feet and which was subsequently expanded by 34,634 square feet.

Financing Highlights

  • Issued 6.50 percent Series I Cumulative Redeemable Preferred Stock generating net proceeds to the Company of $222.2 million, redeemed the entire $100.0 million, 7.875 percent Series D Cumulative Redeemable Preferred Stock and redeemed $100.0 million of the 7.625 percent Series C Cumulative Redeemable Preferred Stock.
  • Closed on a $175.0 million financing with a 1-year term and a 1-year extension option. This facility, which is secured by select assets in the Company‚Äôs debt portfolio, bears interest at 300 basis points over LIBOR and was unfunded as of September 30, 2012.
  • Recapitalized the Meadows, a New Jersey office complex. This recapitalization resulted in the Company having a 50 percent ownership in the complex and recognizing $10.8 million of additional income.

Summary

SL Green Realty Corp. (NYSE: SLG) today reported funds from operations, or FFO, of $104.8 million, or $1.12 per diluted share, for the quarter ended September 30, 2012, compared to $87.9 million, or $1.00 per diluted share, for the same quarter in 2011.

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