This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

All Bets Are Off for Empire State Realty Trust

NEW YORK ( TheStreet) -- Over a month ago I announced to The Street that Empire State Realty Trust investors would soon commence voting on an IPO aimed to provide liquidity for the new REIT anchored also by the iconic 82 year-old office tower.

Now with less than two weeks away from a deadline (March 26th), voters will decide whether the famous office tower will be part of a new REIT bearing its name.

However, based upon a filing on Friday (by Malkin Holdings, LLC) the controlling interest appears to be closer to reality. As Tom Yeatts with SNL Financial explains:

" Vote tallies reported in a March 15 filing by Malkin Holdings LLC, the controlling interest that has led the IPO charge against a tightly run and determined opposition, suggest that the Empire State Realty Trust Inc. IPO could very well be realized. But the opposition group's de facto leader thinks the Malkins are still a long way off from obtaining the necessary number of 'yes' votes."

At one time sides appeared to be split as the 2,800 shareholders weighed-in on the potential risks and rewards. Many current investors had no interest in aligning with the Malkin group who intend to provide a more diverse and liquid structure (hence the reason for forming a REIT).

In a March 14 letter (attached to the Friday filing), Malkin Holdings said 90% of the investors who have already voted -- about two-thirds of the more than 2,800 total -- have approved the REIT plan, which would consolidate the Empire State Building into a publicly traded entity that would include a portfolio that consists of 12 total office properties encompassing around 7.7 million square feet of space, mostly located in the Manhattan area.

Now with just two weeks left the gloves are off and both fighters are swinging hard. The Malkins believe they are all but victorious as their deep-seeded experience has been the primary force behind the "pro REIT" movement. They called the level of support seen so far from Empire State Building Associates LLC, the owner of the Empire State Building, "very strong." As they explained:

"We thank all those who have voted to date in favor of the transaction for their support and those whose votes are in the mail or who are planning to vote this weekend. This remarkable level of participation in such a short period has exceeded our hopes and reflects to us a tremendous enthusiasm for the proposed transaction among many participants."

Meanwhile the opposition group continues to trade jabs. One of the principal leaders, Richard Edelman, has been instrumental in the debate and he has spent countless hours hoping to find support for the legacy structure. His group has continuously sponsored bi-weekly conference calls attempting to build support against the Malkin group.

Members of Empire State Building Associates have until March 25 to vote. But whatever the tally by that date -- the Malkins need 80% of the total to approve the deal -- the Malkins implied that they would continue their campaign, noting that they are permitted to keep the solicitation open beyond the March 25 deadline and "will do so as needed."

1 of 2

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,866.83 +88.68 0.50%
S&P 500 2,074.82 +13.59 0.66%
NASDAQ 4,775.6470 +27.2510 0.57%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs