Empire State Realty misses Q2 operating income estimates

Overview

• Empire State Realty Trust Q2 net income per share at $0.04

• Core FFO per share for Q2 at $0.22

• Operating income missed analyst expectations, per LSEG data

• Co acquired Williamsburg retail asset for $31 mln

Outlook

• Company revises 2025 Core FFO guidance to $0.83-$0.86 per share

• Empire State Realty Trust expects year-end commercial occupancy of 89%-91%

• Company projects 2025 same-store cash NOI change of -2.0% to +1.5%

• Observatory NOI guidance lowered to $90M-$94M for 2025

Result Drivers

• HIGHER EXPENSES - Same-Store Property Cash NOI decreased 5.9% due to increased real estate taxes and property operating expenses

• POSITIVE LEASING SPREADS - Manhattan office leasing spreads increased by 12.1%, marking 16th consecutive qtr of positive spreads

• OBSERVATORY INCOME - Empire State Building Observatory generated NOI of $24.1 mln

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 2 "strong buy" or "buy", 3 "hold" and 1 "sell" or "strong sell"

• The average consensus recommendation for the diversified reits peer group is "hold"

• Wall Street's median 12-month price target for Empire State Realty Trust Inc is $9.00, about 13.7% above its July 22 closing price of $7.77

• The stock recently traded at 92 times the next 12-month earnings vs. a P/E of 89 three months ago

Press Release: ID:nBwbP5GrFa