Q3 2024 Vornado Realty Trust and Alexander's Inc Earnings Call Transcript
Key Points
- Alexander's Inc (ALX) successfully refinanced a $400 million loan on the Bloomberg Headquarters Tower at a favorable 5% interest rate, saving the company $17 million annually.
- The refinancing was highly successful, being 8 times oversubscribed, indicating strong investor confidence in Alexander's Inc (ALX).
- The company has a strong liquidity position with $2.6 billion, including $1 billion in cash, providing a solid financial foundation.
- Alexander's Inc (ALX) has a strategic partnership with NYU for a master lease at 770 Broadway, which will help pay off a $700 million loan on the property.
- The company is open to acquisitions, looking for distressed assets at attractive prices, indicating a proactive approach to growth opportunities.
- The financial results for the quarter were down from last year, with comparable FFO as adjusted at $0.52 per share compared to $0.66 per share in the previous year.
- The decrease in financial performance was primarily due to lower NOI from known move-outs and higher net interest expenses.
- The office occupancy rate decreased to 87.5%, down from 89.3% last quarter, primarily due to move-outs at 770 Broadway.
- The company faces challenges in the San Francisco market, with city-wide vacancy rates at 36% and declining rents.
- Despite a strong liquidity position, Alexander's Inc (ALX) has a handful of credits that are overleveraged, which do not currently contribute to FFO and have little to no equity value.
Good day, and welcome to the Vornado Realty Trust third-quarter 2024 earnings call. (Operator Instructions) Please note, this event is being recorded. I would now like to turn the over to Stephen Borenstein, Senior Vice President and Corporate Counsel. Please go ahead.
Welcome to Vornado Realty Trust's third-quarter earnings call. Yesterday afternoon, we issued our third-quarter earnings release and filed our quarterly report on 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 Form 10-Q and financial supplement. Please be aware that statements made
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