SL GREEN REALTY CORP (SLG) Q2 2025 Earnings Summary

Executive Summary

• Q2 2025 GAAP diluted EPS was ($0.16) and FFO/share was $1.63; total revenues were $241.9M, with rental revenue up 8.8% YoY and SUMMIT revenue down modestly YoY .
• Management raised full-year 2025 FFO guidance to $5.65–$5.95 (midpoint +$0.40), driven by gains in the debt & preferred equity book; net income guidance maintained at $1.27–$1.57 .
• Strong leasing execution: 46 Manhattan office leases totaling 541,721 sf signed; same-store office occupancy (incl. signed, not commenced) at 91.4% and reiterated path to 93.2% by year-end .
• S&P Global consensus for Q2 2025 revenue was $169.0M*, vs company-reported $241.9M, a beat; S&P “Primary EPS” consensus was ($0.041)* vs S&P “Primary EPS” actual ($0.75), while GAAP diluted EPS was ($0.16), highlighting definition differences [GetEstimates Q2 2025] .

Note: *Values retrieved from S&P Global.

What Went Well and What Went Wrong

• What Went Well

  • FFO/share of $1.63 included $0.61/share of income from the 522 Fifth mortgage repayment, offset by reserves and derivative marks; full-year FFO guidance raised (+$0.40 midpoint) .
  • Leasing velocity remained robust: 46 leases, 541,721 sf signed in Q2, with +2.4% mark-to-market on replacement leases; average starting rent $95.93/sf, and concessions trending lower QoQ (free rent 6.3 months; TI $78.81/sf) .
  • Asset management wins: 522 Fifth mortgage repaid for $200.0M (net proceeds $196.6M); sold 50% of 625 Madison preferred for $104.9M; raised >$1.0B for SLG Opportunistic Debt Fund, enhancing liquidity and capital deployment capacity .

• What Went Wrong

  • GAAP net loss attributable to common shareholders of ($11.1M) and diluted EPS ($0.16) due to equity loss from JVs and fair value adjustments/reserves; FFO down YoY vs Q2 2024 ($2.05/share) .
  • Same-store cash NOI fell 1.0% YoY in Q2 (ex-lease termination) reflecting mix shifts and SUMMIT operations temporarily offline for “Ascent” experience (expected back by end of summer) .
  • Occupancy dipped QoQ to 91.4% (incl. signed not commenced), impacted by an unbudgeted tenant default at 711 Third; management reiterated year-end target but acknowledged timing frictions .

Financial Results

Revenue breakdown (selected components):

KPIs:

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• “We concluded over 540,000 square feet of leasing… and refilled the pipeline to over 1,000,000 square feet for near term execution.”
• “We realized nearly $90,000,000 of profit on a $130,000,000 investment [522 Fifth]… and sold a 50% participation in 625 Madison preferred… yielding over $300,000,000 of fresh cash proceeds.”
• “Our successes so far this year allow us to… increase our FFO guidance range by a meaningful $0.40 or 7.4% at the midpoint.”
• “An unbudgeted tenant default at 711 Third Avenue… space went dark.”
• “AI and tech demand in Midtown South is just starting to get revved up… Sigma, Pinterest, and two more pending.”
• “When that [1552–1560 Broadway] debt is extinguished… we would recognize a debt gain substantially larger than the $20,000,000 we currently have in guidance.”
• “Caesars Palace Times Square… transformational for Times Square… halo effect for small businesses and community.”

Q&A Highlights

• Occupancy cadence: Near-term dip in Q2 tied to a tenant default at 711 Third; reiterated confidence in achieving 93.2% by YE as pipeline converts .
• Guidance drivers: +$0.69/share incremental FFO from 522 Fifth repayment, offset by $0.19/share reserves on 625 Madison; interest expense trending ~$0.10/share above plan due to timing of asset sales .
• Debt gains optionality: Purchased 1552–1560 Broadway debt for $63.0M vs $219.5M claim; potential for outsized extinguishment gains upon resolution .
• Demand breadth: AI/tech uptick in Midtown South; larger tenants facing tight availability driving renewals and expansions, spillover into non-trophy corridors .
• SUMMIT: “Ascent” temporarily offline; attendance above projections; expected to return by end of summer .

Estimates Context

Observations: Company revenue outpaced S&P consensus materially; EPS comparisons differ across definitions (S&P “Primary EPS” vs GAAP diluted EPS), and coverage was thin (# of EPS estimates = 1)* [GetEstimates Q2 2025] .

Note: *Values retrieved from S&P Global.

Key Takeaways for Investors

• FFO uplift catalysts were realized (522 Fifth repayment), with further potential from discounted debt extinguishments (e.g., 1552–1560 Broadway) pending extinguishment mechanics .
• Leasing momentum and improving economics (lower concessions, higher starting rents) should drive economic occupancy and NOI into H2 2025 and 2026 as commencements ramp .
• The DPE portfolio monetizations and opportunistic debt fund capital provide >$1B+ incremental liquidity and flexibility for high-IRR deployments in NYC dislocation .
• Same-store cash NOI was modestly down YoY in Q2, but trajectory supports increases into 2026 per commencements and occupancy progression guidance .
• Watch SUMMIT normalization with “Ascent” returning; expect margin and revenue tailwinds vs Q2 .
• Occupancy: near-term timing and isolated defaults can mask trajectory; management reiterated confidence in reaching 93.2% YE occupancy (incl. signed) .
• EPS vs consensus: revenue beat highlights strong gross performance; EPS variance reflects measure definitions—focus on FFO/share and cash NOI for REIT valuation context [GetEstimates Q2 2025].

SL Green Realty Corp. source documents and data: press release/8-K Q2 2025 –, earnings call transcript –, Sigma lease , fund commitments press release , Q1 2025 materials – –, Q4 2024 materials – –.