SL Green (SLG) Sheds 707 Eleventh Avenue Property for $95M
SL Green Realty Corp. SLG announced the sale of its ownership interest in 707 Eleventh Avenue to a domestic buyer for a gross sale price of $95 million. The transaction, expected to close in the first quarter of 2022, is subject to customary closing conditions.
707 Eleventh Avenue is a 160,000-square-foot loft-style building. SL Green purchased the property in January 2020 for $90 million. SL Green plans to use the proceeds from the sale to repay corporate debt.
Per management, “The sale of 707 Eleventh Avenue demonstrates investor demand for quality, value-add investment opportunities in New York City.”
Recently, SL Green resorted to non-core asset sales to enhance its liquidity for funding development projects and share buybacks. In line with this, the REIT sold a 25% interest in One Madison Avenue to an international investor.
SL Green also announced the sale of its ownership interest in the office and garage condominiums at 110 East 42nd Street to Meadow Partners for a gross sale price of $117.1 million. Moreover, together with its joint-venture partner Stonehenge, SL Green announced the sale of its leasehold interest in 1080 Amsterdam Avenue for a gross sale price of $42.5 million.
While dispositions are strategic fits for the long term, SLG cannot bypass the dilutive impact on its earnings in the near term. Per management, the core portfolio GAAP net operating income is likely to be adversely impacted by property dispositions and planned sales in 2021.
Shares of this currently Zacks Rank #3 (Hold) playerhave gained 3.2% over the past three months, underperforming the industry's growth of 4%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Stocks to Consider
Some better-ranked stocks from the REIT sector are OUTFRONT Media OUT, Cedar Realty Trust CDR and CubeSmart CUBE.
The Zacks Consensus Estimate for OUTFRONT Media’s 2021 fund from operations (FFO) per share has been raised 13.8% over the past two months. OUT’s 2021 FFO per share is expected to increase 45.71% from the year-ago quarter’s reported figure.
OUTFRONT Media flaunts a Zacks Rank #1 (Strong Buy) at present. Shares of OUT have rallied 7% in the past three months.
The Zacks Consensus Estimate for Cedar Realty’s current-year FFO per share has been raised 2.6% to $2.36 in the past two months. Over the last four quarters, CDR’s FFO per share surpassed the consensus mark twice and missed the same in the other two, the average surprise being 6.4%.
Currently, CDR sports a Zacks Rank of 1. Shares of Cedar Realty have appreciated 44.6% in the past six months.
CubeSmart carries a Zacks Rank #2 (Buy) at present. Over the last four quarters, CUBE’s FFO per share surpassed the consensus mark on all occasions, the average being 7.10%.
The Zacks Consensus Estimate for CubeSmart’s 2021 FFO per share has been revised 1.9% upward in the past month to $2.10. Shares of CUBE have appreciated 18% in the past six months.
Note: Anything related to earnings presented in this write-up represent FFO — a widely used metric to gauge the performance of REITs
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SL Green Realty Corporation (SLG) : Free Stock Analysis Report
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