SL Green Realty Plunge 6.01% as Q2 Earnings Miss and Sector Woes Weigh on Outlook

Shares of SL Green Realty (SLG) fell 6.01% on Tuesday, hitting a level not seen since September 2025, with intraday losses reaching 7.69%. The decline reflects heightened volatility amid mixed institutional activity and cautious market sentiment.

Institutional investors have shown divergent strategies, with some adding to positions while others trimmed holdings. Recent purchases by firms like Toronto Dominion Bank and ExodusPoint Capital Management signaled optimism about SLG’s long-term value in New York’s commercial real estate market. Conversely, reductions by Swiss National Bank and Mitsubishi UFJ Trust & Banking Corp. highlighted concerns over short-term risks. The company’s monthly $0.27-per-share dividend, declared in July, also drew interest from income-focused investors, though questions linger about its sustainability amid recent earnings pressures.

Analyst ratings have been split, exacerbating uncertainty. Piper Sandler upgraded the stock to Overweight in July, citing strong leasing activity, while BMO Capital and Goldman Sachs downgraded it, citing sector-wide challenges and valuation concerns. As of mid-August, the average analyst rating remained “Hold,” underscoring a lack of consensus on near-term prospects. Meanwhile, short sellers have grown more aggressive, with increased put options activity and bearish bets suggesting expectations of further declines despite a broader September market rally.

Operational developments offered some support. SLG secured a 32,000-square-foot lease at 1350 Avenue of the Americas in September and added 346 Madison Avenue to its portfolio in late August, reinforcing its focus on prime Manhattan assets. However, Q2 2023 earnings, which missed estimates due to lower occupancy and rising costs, triggered a 11.1% drop in the stock since the report. Upcoming Q3 results on October 18 will be closely watched for signs of recovery.

Broad market trends also weigh on SLG. Persistent office sector challenges, driven by hybrid work models, and political uncertainties in New York City have dampened investor confidence. While the company’s high-yield appeal remains attractive, analysts remain divided on its ability to sustain payouts. The stock trades at a discount to intrinsic value estimates, but unresolved risks in the sector and regulatory concerns continue to cloud its outlook.