NEW YORK – SL Green Realty Corporation (NYSE: NYSE: ), Manhattan’s largest office landlord, has launched a public offering of $400 million of its common stock, the company announced today. The real estate investment trust also plans to offer the underwriters a 30-day option to purchase up to $60 million in additional shares.
The proceeds from the stock offering are earmarked for general corporate purposes, which may include investment opportunities and repayment of certain outstanding debts of the company. Wells Fargo (NYSE: ) Securities, JP Morgan, TD Securities, BMO Capital Markets, and Deutsche Bank (ETR:) are joint book-running managers for securities transactions.
The offering is part of an effective shelf registration statement filed with the Securities and Exchange Commission on November 21, 2024. Prospective investors may access the prospectus free of charge through the SEC’s website or obtain copies from the joint bookrunner through specified contact methods.
As of September 30, 2024, SL Green’s portfolio includes interests in 55 buildings, totaling 31.8 million square feet in Manhattan. This includes 28.1 million square feet of Manhattan buildings and 2.8 million square feet of debt and preferred equity investments.
The Company’s press releases contain forward-looking statements that are subject to risks and uncertainties, which could cause actual results to differ materially from those anticipated. These statements are based on management’s current expectations and assumptions about future real estate industry trends and market conditions in the New York metropolitan area.
Investors are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. SL Green undertakes no obligation to update these statements in light of new information or future events. This announcement is based on a press release statement and does not constitute an offer to sell or a solicitation of an offer to buy shares.
In other recent news, SL Green Realty has been the focus of several analysts. Barclays (LON: ) raised its price target for the company to $78.00 from $66.00, citing strong leasing activity. The company signed leases for 2.8 million square feet this year, surpassing its 2024 target of 2 million square feet. Trust Securities also raised its price target on SL Green Realty from $55.00 to $72.00, noting strong leasing activity in Manhattan.
BMO Capital Markets, Piper Sandler, and Compass Point also updated their positions on the company. BMO raised its price target to $87.00 from $72.00, while Piper Sandler raised its price target to $90.00 from $75.00. Compass Point maintained a neutral rating but raised the price target to $65.00 from $60.00.
Despite positive leasing activity, SL Green Realty’s funds from operations (FFO) per share guidance for 2024 was unchanged from $7.45 to $7.75. The company also reported third-quarter headline FFO of $1.13 per share, which fell short of consensus estimates, while core FFO exceeded expectations at $1.55 per share.
SL Green Realty plans to launch a debt fund in the fourth quarter of 2024 after investing about $110 million in the debt securities business. The company is also moving forward with the sale of a joint venture stake in the prestigious One Vanderbilt development, which is expected to close in the fourth quarter of 2024. These are recent developments in the company’s ongoing operations.
InvestingPro Insights
SL Green Realty Corp. The recent announcement of the stock offering comes at a time when the company’s financial metrics paint an interesting picture. According to data from InvestingPro, SLG has a market capitalization of $5.23 billion, reflecting its significant presence in the Manhattan real estate market.
Despite the challenging environment for office real estate, SLG has shown resilience. An InvestingPro tip highlights that the company has maintained dividend payouts for 28 consecutive years, demonstrating its commitment to shareholder returns even in turbulent times. This can be particularly attractive to investors looking for income stability in the current market.
The stock’s performance has been particularly strong, with InvestingPro data highlighting a cumulative price return of 147.41% over the past year. That’s consistent with another InvestingPro tip indicating higher returns over the past year, which may have contributed to the company’s decision to capitalize on its stock’s momentum with this offering.
However, it is important to note that analysts expect sales to decline in the current year, according to an InvestingPro tip. This may explain a company’s move to raise capital, possibly to strengthen its financial position or pursue strategic investments in a challenging market.
For investors seeking a more comprehensive analysis, InvestingPro offers additional tips and insights. There are 11 more InvestingPro Tips available for SLG, providing a deeper understanding of the company’s financial health and market position.
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