Executive Summary

Core FFO per share was $0.17, a $0.01 beat vs consensus, driven by strong New York leasing; GAAP EPS was a loss of $0.05 given higher operating and interest expense .
Revenue performance was resilient: total revenues of $187.0M vs S&P Global consensus of $177.0M, a clear beat; GAAP EPS (-$0.05) missed consensus (-$0.02) while FFO/share ($0.17) exceeded consensus ($0.158) *.
FY25 Core FFO guidance was reaffirmed at $0.51–$0.57 per share; operating assumptions were raised: leasing activity to 900k–1.1M sf and year-end same-store leased occupancy to 84.4%–86.4% (midpoint +50 bps) .
Leasing momentum accelerated: 283,874 sf signed (PGRE share 186,447 sf) at $76.52 psf with 12.9-year WALT; same-store leased occupancy rose 140 bps q/q to 86.2% .
Capital markets actions support flexibility: 45% interest sold in 900 Third Avenue (~$95M net proceeds) and, post-quarter, sale of 25% interest in One Front Street ($255M valuation, $11.5M net proceeds, seller financing at 5.50%)—supporting repositioning plans and balance sheet liquidity .

What Went Well and What Went Wrong

What Went Well

Robust leasing drove occupancy higher: same-store leased occupancy increased 140 bps q/q to 86.2%, with 278k sf in NYC; “We executed leases totaling approximately 284,000 square feet, marking our strongest first quarter of leasing since 2019” .
High-profile wins: Kirkland & Ellis expanded to 179k sf at 900 Third Avenue, lifting building leased occupancy from 68.9% to 90.2%; Benesch signed 121k sf at 1301 Sixth Avenue, taking the asset to 90% leased .
Guidance confidence: Management reaffirmed FY25 Core FFO $0.51–$0.57 and raised leasing and occupancy operating assumptions; “Based on year-to-date results…we are increasing our leasing guidance to 900,000–1,100,000 square feet” .

What Went Wrong

Same-store performance softness: Same-store NOI declined 5.4% YoY and same-store Cash NOI fell 4.1% YoY, reflecting lease roll and San Francisco pressures .
GAAP earnings headwind: Diluted GAAP EPS was a loss of $0.05 due to higher operating and interest expense, and lower fee income vs prior year .
San Francisco drag and heavy 2025 roll: SF same-store leased fell 150 bps q/q to 82.3%; ~490k sf (27.7% at share) expires in 2025, ~80% from Google/JPMorgan, likely pressuring near-term occupancy before improvement later .

Financial Results

Metric	Q3 2024	Q4 2024	Q1 2025
Revenue ($USD Millions)	$194.9	$186.3	$187.0
GAAP Diluted EPS ($)	-$0.04	-$0.18	-$0.05
FFO per diluted share ($)	$0.18	$0.17	$0.17
Core FFO per diluted share ($)	$0.19	$0.19	$0.17
PGRE’s share of NOI ($USD Millions)	$89.47	$90.18	$86.79
PGRE’s share of Cash NOI ($USD Millions)	$84.11	$86.14	$83.68
Same-store NOI YoY (%)	+1.8%	-0.4%	-5.4%
Same-store Cash NOI YoY (%)	-2.9%	-0.1%	-4.1%
Same-store leased occupancy (%)	84.7%	84.8%	86.2%

Segment breakdown (Q1 2025):

Segment KPI	Q1 2024	Q1 2025
PGRE’s share of NOI – New York ($USD Millions)	$68.37	$58.65
PGRE’s share of NOI – San Francisco ($USD Millions)	$26.24	$29.82
PGRE’s share of NOI – Other ($USD Millions)	-$1.03	-$1.69
PGRE’s share of Cash NOI – New York ($USD Millions)	$63.73	$53.89
PGRE’s share of Cash NOI – San Francisco ($USD Millions)	$26.16	$31.37
PGRE’s share of Cash NOI – Other ($USD Millions)	-$0.92	-$1.58

Key KPIs (Q1 2025):

KPI	Value
Total square feet leased (PGRE share)	283,874 total; 186,447 share
Initial rent (cash psf)	$76.52
Weighted average lease term	12.9 years
TI + LC per annum (psf)	$13.74 (18.0% of initial rent)
Second gen mark-to-market	+7.1% GAAP; -1.5% cash
Same-store leased occupancy (q/q change)	86.2% (+140 bps)

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change	Status
Core FFO per share	FY2025	$0.51–$0.57	$0.51–$0.57	None	Maintained
Net loss per share (GAAP)	FY2025	($0.36)–($0.30)	($0.36)–($0.30)	None	Maintained
Leasing activity (sf)	FY2025	Prior midpoint increased	900,000–1,100,000	+100,000 at midpoint	Raised
Same-store leased % (year-end)	FY2025	Prior midpoint increased	84.4%–86.4%	+50 bps at midpoint	Raised
Same-store Cash NOI decrease	FY2025	Prior baseline	(7.0%)–(11.0%)	n/a	Maintained
Same-store NOI decrease	FY2025	Prior baseline	(9.0%)–(13.0%)	n/a	Maintained
G&A ($MM)	FY2025	Prior baseline	$64–$67	+$1.5 at midpoint	Adjusted
Interest & debt expense ($MM)	FY2025	Prior baseline	$142–$145	-$1.5 at midpoint	Adjusted
Cash NOI ($MM)	FY2025	Prior baseline	$296–$301	n/a	Maintained
NOI ($MM)	FY2025	Prior baseline	$304–$311	n/a	Maintained
Dividend policy	FY2025	Dividend suspended since Sep-2024	No change	n/a	Maintained

Earnings Call Themes & Trends

Topic	Q3 2024 (Previous Mentions)	Q4 2024 (Previous Mentions)	Q1 2025 (Current Period)	Trend
Flight to quality in NYC	Occupancy down amid lease roll; raising 2024 guidance modestly	Core FFO $0.19; highlighted 2025 guidance headwinds from expirations	“Strongest first-quarter leasing since 2019”; pricing power on upper floors; pipeline >375k sf in negotiations	Improving momentum
AI/technology tenant demand (SF)	Limited explicit AI commentary; SF demand subdued	Emphasis on 2025 expirations (Google/JPMorgan)	“~20 AI deals totaling >275k sf; more than half new-to-market”	Building demand base
San Francisco policy/business environment	n/a	n/a	Meetings with new Mayor; focus on safety, business engagement; optimism on recovery	Improving policy backdrop
Leasing/occupancy outlook	2024 same-store leased fell due to Clifford Chance expiration	84.8% same-store leased at YE 2024	NYC occupancy “bottomed” and rising; SF to dip near-term then improve	Mixed near-term; improving medium-term
Balance sheet and capital actions	Revolver covenants and debt maturity schedule detailed	2025 guidance with elevated interest expense drivers	900 Third Avenue JV sale (~$95M proceeds); post-quarter One Front Street 25% sale and seller financing	Proactive asset capital recycling
Dividend policy	Dividend suspended in Sep-2024	Dividend suspension reiterated	No change	Neutral

Management Commentary

“We executed leases totaling approximately 284,000 square feet, marking our strongest first quarter of leasing since 2019… core FFO of $0.17 per share for the first quarter, exceeding consensus by $0.01” — Albert Behler (CEO) .
“Kirkland & Ellis… totaling 179,000 square feet… improving the leased occupancy of the building… from 68.9% to 90.2%” — Albert Behler (CEO) .
“We are increasing our leasing guidance to now be between 900,000 square feet and 1.1 million square feet… [and] increasing our same-store leased occupancy guidance to 84.4%–86.4%” — Wilbur Paes (COO/CFO) .
“Upper floors… command rents in excess of $120 a foot [at One Market]” — Peter Brindley (EVP, Head of Real Estate) .
“More than half of the AI-based tenants that transacted in the first quarter are new to the market” — Peter Brindley .

Q&A Highlights

Capital allocation: Management is “disciplined and opportunistic,” open to transactions like 900 Third Avenue to enhance flexibility and shareholder value .
San Francisco leasing: Law firm backfill on “Google floors” at One Market with upper floors “in excess of $120/ft”; broader pipeline ~7M sf with tenants of varying sizes, including AI .
Large expirations and backfill: Active paper trading for Visa (portion backfill in advanced discussions), Morgan Lewis, Autodesk in 2026; Showtime block (~250k sf) at 1633 Broadway seeing multi-tenant interest .
Guidance mechanics: Same-store NOI guidance unchanged despite higher leasing due to commencement timing; management expects potential refinement “to the better” as year progresses .
NYC pricing power: Scarcity on upper floors in Midtown provides rent push opportunities; tenants engaging earlier driven by “fear of loss” .

Estimates Context

Metric	Q4 2024 Actual	Q4 2024 Consensus*	Q1 2025 Actual	Q1 2025 Consensus*	Outcome (Q1 2025)
Revenue ($USD Millions)	$186.3	$180.405*	$187.0	$176.983*	Beat
GAAP Primary EPS ($)	-$0.18	-$0.04*	-$0.05	-$0.02*	Miss
FFO / Share (REIT) ($)	$0.17	$0.1825*	$0.17	$0.15833*	Beat

Values retrieved from S&P Global.*

Implications: Street will likely raise leasing/occupancy assumptions and revenue run-rate given Q1 beats and raised operating assumptions, but GAAP EPS may remain pressured near-term by SF lease roll and interest expense headwinds .

Key Takeaways for Investors

Leasing outperformance and occupancy gains in NYC underpin the reaffirmed FY25 Core FFO guide; execution on upper-floor pricing supports rent roll-ups over time .
Q1 delivered a clean FFO/share and revenue beat vs consensus; GAAP EPS miss reflects the REIT reporting construct and interest/operating cost dynamics, not core cash performance *.
Raised operating assumptions (leasing and occupancy) signal confidence; commencement timing tempers immediate same-store NOI guidance, but trajectory is positive .
San Francisco remains a near-term drag (82.3% same-store leased; heavy 2025 expirations), yet AI and legal demand plus civic engagement point to medium-term recovery catalysts .
Balance sheet flexibility improved via minority sales (900 Third, One Front) and ample cash/restricted cash (~$499.3M at quarter end excluding non-core debt); 2026 maturities (notably 1301 Sixth) are being proactively de-risked .
Dividend remains suspended, prioritizing balance sheet strength and capex/leasing investments; reinitiation likely contingent on sustained NOI recovery and leverage normalization .
Near-term trading: Favorable setup given leasing momentum and beats; watch SF lease roll headlines. Medium-term thesis: Flight to quality in NYC, amenity-led differentiation (Paramount Club), and policy tailwinds in SF to drive NOI stabilization and eventual growth .

Additional Data Points and Transactions

Q1 portfolio operations: Same-store NOI $87.34M (-5.4% YoY), same-store Cash NOI $84.12M (-4.1% YoY); PGRE share of Adjusted EBITDAre $77.9M .
Benesch lease (121k sf, 16.5-year term) lifts 1301 Avenue of the Americas to 90% leased, supported by Paramount Club amenity offering .
Post-quarter One Front Street 25% sale at $255M valuation; seller financing $40.5M at 5.50% fixed; $11.5M net proceeds retained .

Notes: Where noted with an asterisk (*), values retrieved from S&P Global.

Paramount Group, Inc. (PGRE)·Q1 2025 Earnings Summary