SL Green Realty Exceeds Q2 Earnings and Revenue Expectations

SL Green Realty reported Q2 FFO of $1.63, beating estimates by $0.25. Revenue reached $241.92M, an 8.6% YoY increase and a $72.93M beat. The company also reported a net loss of $0.16 per share for the quarter.

SL Green Realty Corp. (NYSE: SLG), Manhattan's largest office landlord, reported its Q2 2025 financial results, showing a mixed performance with some positive developments and areas of concern. The company reported a net loss of $0.16 per share, compared to a net loss of $0.04 per share in Q2 2024. However, the company's FFO (Funds from Operations) of $1.63 per share beat estimates by $0.25. Revenue reached $241.92 million, an 8.6% year-over-year (YoY) increase, and a $72.93 million beat.

The company's key operational highlights include signing 46 Manhattan office leases totaling 541,721 square feet in Q2 2025, with a positive mark-to-market of 2.4%. Manhattan same-store office occupancy stood at 91.4%, with expectations to reach 93.2% by year-end. The company increased its 2025 FFO guidance to $5.65-$5.95 per share, a $0.40 increase at the midpoint, reflecting incremental income generated by the company's debt and preferred equity portfolio.

Notable transactions include the $200 million repayment of the 522 Fifth Avenue investment, the sale of 85 Fifth Avenue for $47 million, and the acquisition of the remaining 49.9% interest in 100 Park Avenue. The company's special servicing business grew to $6.1 billion in active assignments.

While the headline FFO of $1.63 per share represents a 20.5% decline from the $2.05 reported in Q2 2024, this comparison is complicated by significant non-recurring items in both periods. The more troubling metric is the same-store cash NOI decline of 1.0% (excluding lease termination income), indicating modest but real deterioration in the core operating portfolio's performance. This suggests continued pressure on Manhattan office fundamentals. However, leasing momentum remains strong, with 46 Manhattan office leases signed covering 541,721 square feet. The company's 91.4% Manhattan office occupancy is holding steady with a projected increase to 93.2% by year-end, significantly outperforming the broader Manhattan market.

The company's debt and preferred equity (DPE) portfolio delivered exceptional results this quarter, most notably the $125 million investment in 522 Fifth Avenue being repaid for $200 million - generating a substantial $75 million gain. This success, along with other DPE activities, prompted management to increase 2025 FFO guidance by $0.40 per share at the midpoint (now $5.65-$5.95). The special servicing business continues its rapid expansion, now managing $6.1 billion in active assignments (up $1.3 billion) with another $10.5 billion designated.

While net loss widened to $0.16 per share versus $0.04 in Q2 2024, SLG maintained its $0.2575 monthly dividend, reflecting management's confidence in cash flow stability despite accounting losses.

References:
[1] https://seekingalpha.com/news/4468104-sl-green-realty-ffo-of-1_63-beats-by-0_25-revenue-of-241_92m-beats-by-72_93m
[2] https://www.stocktitan.net/news/SLG/sl-green-realty-corp-reports-second-quarter-2025-eps-of-0-16-per-1ggrexjlonr1.html