NEW YORK CITY—Empire State Realty Trust had a good first quarter, according to its newly released earnings report for the first three months of the year.
Says Anthony Malkin, chairman, CEO and president, “We had a positive start in 2014. We continued to produce strong leasing results including renewal leases and expansions with several key tenants. Additionally, we saw strength in attendance at the Empire State Building Observatory and increased Observatory revenues from optimized ticket sales and pricing, despite difficult weather and the shift of Easter week from March to April. We believe our low levered balance sheet and new leases at higher spreads continued to drive strong value.”
The REIT achieved funds from operations of $0.17 per fully diluted share and net income attributable to the company was $0.05 per fully diluted share. The total portfolio was 87.2% occupied, up 110 basis points from December 31, 2013; the total portfolio was 88.8% leased as of March 31.
The Manhattan office portfolio was 86% occupied, up 160 basis points from December 31, the retail portfolio was 92.2% occupied, up 30 basis points from December 31, 2013 while Empire State Building was 83% occupied. Overall, ESRT executed 50 leases, representing 191,319 rentable square feet across the total portfolio,
FFO was $41.3 million, or $0.17 per fully diluted share. Net income attributable to the company was $4.4 million, or $0.05 per fully diluted share. The company began operations upon the completion of its formation transactions and initial public offering in October 2013 and therefore had no comparative results to report for the first quarter 2013.
The company reported that its total portfolio, containing 8.4 million rentable square feet of office and retail space, was 87.2% occupied at the end of the first quarter 2014. Percentage occupied was up 110 basis points from 86.1% at the end of the fourth quarter 2013, and up 720 basis points from 80.0% at the end of the first quarter 2013. Including SLNC, the Company's portfolio was 88.8% leased at March 31, 2014.
The company's office portfolio, containing 7.7 million rentable square feet, was 86.8% occupied at the end of the first quarter 2014, up 120 basis points from the end of the fourth quarter 2013, and up 700 basis points from the end of the first quarter of 2013.
The company's retail portfolio, containing approximately 624,000 rentable square feet, was 92.2% occupied at the end of the first quarter 2014. This compares to 91.9% at the end of the fourth quarter of 2013, and compares to 82.1% at the end of the first quarter 2013. Including SLNC, the company's retail portfolio was 92.5% leased as of March 31.
For the three months ended March 31, 2014, the company executed 50 leases within the total portfolio, comprising 191,319 rentable square feet. Total leasing volume included 49 office leases, comprising 190,966 rentable square feet, and 1 retail lease, comprising 353 rentable square feet.
On a blended basis, the 50 new, renewal and expansion leases signed within the total portfolio during the quarter had an average starting rental rate of $48.03 per rentable square foot, representing an increase of 15.8% over the prior in-place rent on a fully escalated basis.
The company paid a dividend of $0.085 per share for the first quarter 2014.
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
Rayna Katz
Rayna Katz is a seasoned business journalist whose extensive experience includes coverage of the lodging sector, travel and the culinary space. She was most recently content director for a business-to-business publisher, overseeing four publications. While at Meeting News, a travel trade publication, she received a Best Reporting award for a story on meeting cancellations in New Orleans during Hurricane Katrina.
