Q2 2024 Vornado Realty Trust and Alexander's Inc Earnings Call Transcript
Key Points
- Alexander's Inc (ALX) reported a strong start in leasing activities for the year, with significant renewals and new leases.
- The company successfully completed the sale of its portion of UNIQLO's Fifth Avenue flagship for $350 million, which will enhance liquidity.
- The PENN District transformation is attracting a diverse range of tenants, including technology, fashion, financial, legal, academic, and media sectors.
- The company has a robust pipeline of deals, with 2.6 million square feet in negotiation, indicating strong future leasing activity.
- Alexander's Inc (ALX) has strong liquidity with $2.7 billion, including $1.1 billion in cash and restricted cash, and $1.6 billion undrawn under revolving credit facilities.
- Second quarter comparable FFO as adjusted was $0.57 per share, down from $0.72 per share in the same quarter last year.
- Higher projected net interest expense and temporary impact of known vacancies are expected to affect 2024 comparable FFO.
- The company faces challenges in the financing markets, particularly for office spaces, although there are early signs of improvement.
- Concessions for leasing have stabilized but remain stubbornly high, impacting net effective rents.
- The occupancy rate is expected to trend down in the next quarter due to significant tenant move-outs, such as the 275,000 square feet vacated at 770 Broadway.
Good morning, and welcome to the Vornado Realty Trust second-quarter 2024 earnings call. My name is Rocco, and I will be your operator for today's call. This call is being recorded for replay purposes. (Operator Instructions) I will now turn the call over to Mr. Steve Borenstein, Executive Vice President and Corporate Counsel. Please go ahead.
Welcome to Vornado Realty Trust second-quarter earnings call. Yesterday afternoon, we issued our second quarter earnings release and filed our quarterly report on Form 10-Q with the Securities and Exchange Commission. These documents as well as our supplemental financial information packages are available on our website, www.vno.com, under the Investor Relations section. In these documents and during today's call, we will discuss certain non-GAAP financial measures. Reconciliations of these measures to the most directly comparable GAAP measures are included in our earnings release
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