ALX - Earnings call 3 2022 | Alexander's, Inc.

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Operator

Welcome to the Vornado Realty Trust earnings and webcast for the third quarter of 2022. My name is Vanessa, and I will be your operator for today. [Operator Instructions]

I will now turn the call over to Steven Borenstein, Senior Vice President and Corporate Counsel. Steve, you may begin.

Steven Borenstein

Trust earnings Realty Vornado to third call. quarter Welcome third release Form and afternoon, with we our earnings our issued Commission. Exchange on Yesterday filed quarter quarterly Securities and the XX-Q report website, supplemental as documents packages on Investor well section. our www.vno.com, These financial the under as are information available Relations our In discuss non-GAAP these today's measures. financial will and we during documents call, certain Form Reconciliations included in are of GAAP XX-Q financial comparable and measures these measures directly to supplement. earnings the release, most our be statements statements Please other statements, during variety made deemed be may differ these forward-looking actual call from of that due may results aware factors. and and this a risks, materially uncertainties to Please on for regarding these refer Exchange report Form and XX-K Securities risks and for more information uncertainties. ended filings to XXXX, with the the XX, annual Commission, including our year our December The information include today's may only accurate time-sensitive date. be as of call may that duty does not undertake company The update a statements. any forward-looking to

for Chairman and Officer; comments today On opening are our call Officer. Financial Chief Michael Roth, Steven and from the Executive Chief Franco, management and President

available is Our senior present for also questions. team and

turn will Steven over call I Roth. to the now

Steven Roth

good Steve, morning, and you, Thank everyone.

quarter. Michael headwinds economy cover rates, As up a still we last comparable third from FFO a year. a had from up expect will XX% moment, year and year's last rising quarter to be good slowing from another in interest this with we Despite fair amount

slowing is the a bit -- XXX,XXX a below interest result square higher leased lot timing. a This of the in XXX,XXX result rates numbers effect quarter, feel and the of year of the York, full given feet the full impact. next feet, little well of our will year effect Overall, trend. market, We square New we on this

pipeline pursuing markets fight slowing, explain, million will capital a and clearly The in inflation. Fed are As our X.X York volatile. is against their The Michael is serious deadly economy robust New square feet. is

assets so debt X million extended no we XXXX, year, a of next billion As coming $XXX and only through following the we actions. to significant this due XXXX. the for our X Earlier in extended near-term $X.X outstanding a top $XXX our totaling XXXX years. on debt priority, revolving million lines in liquidity coming with we X maturity, we Further, and now XXXX, due unsecured modest providing have taken very credit have

rate X.X% X $X In of for years, average addition, the our floating a months. of term we at interest protection -- providing LIBOR case above we a as X.X%. SOFR debt fixed billion an may swapping Further, on basis have of protected weighted to by exposure additional of floating $X debt billion be caps by for weighted rate XX rate average on or average a debt weighted

the are see line. line in the caps Page XX financial in supplement, this activity Mark-to-market Please these which and $XXX by [indiscernible] now swaps all of describes our aggregate, million.

So really remaining in is mature Be effect, rate rate aware environment. as million nothing debt a higher protect into debt. floating largely as long $XXX is can that our JV exposure only which

I to give development. conducive of been demolition tour to the [ lobby skin you us the and with down the The through. Island are of a PENN of are Railroad Long complete. fourth reactions We not is PENN call, and outstanding. We'll are that the far at will District. to be say X we and of amenities XXXX. focus truly have Broker look. headwinds environment PENN Hotel be area all quarter course, PENN tenant X is completed ground-up concourse. to in must happy scheduled in coming current second The as Bussell take all the very now is, along down and our invite The The now and a you ] come

I Lastly, want comment to dividend. on our

equal dividends our out income is now to XXXX. to in income. policy our to We be taxable pay taxable lower expect Our

not from assume budgeting to sales, we Central asset curve. no the are income interest and We South. have We Park XXX will rate yield

As dividend commensurate XXXX, such, projection our income. Trustees -- taxable protection to our in of plans with rightsize of our Board

allow course, retain to cash. Of us this will more

Now over to you, Michael.

Michael Franco

good and Steve, you, morning, Thank everyone.

mentioned, quarter. we Steve As had good another

While we core from rates, headwinds experienced well. rising business our interest some performed

leases, quarter recovery increased Third debt. net rent on an period prior our increase The year's higher on our Page adjusted comparable for provided as compared tax variable primarily of by partially was release and our rate or expense businesses was earnings quarter, $X.XX for our Page commencement X. XX.X%. share new per quarter-over-quarter estate from $X.XX office rates third increase variable in an $X.XX driven FFO last supplement the retail real continued to and in on a on at X interest We accruals offset financial by adjustment and the mark, bridge of

the anticipate for expect up FFO still share debt be next earlier rates we impact from Notwithstanding variable year. year, XXXX in greater our the share additional comparable a from per interest will per year-over-year. full do expense result year the rates additional interest rates will growth for impact our on rising The higher in we as FFO than comparable a rate variable expense have rising will debt cost lower

due quarter, this partially this the have we Steve We the mitigated covered. hedging as impact significant to did of just of amount

XX.X% over cash NOI quarter. by increased year's the quarter third prior same-store the Company-wide, for third

related have the adjustments would market still accrual X.X%. been the real estate taxes, Excluding increase solid to the

up several due NOI of X.X%, to cash rent retail the same-store very Our commencement strong leases. primarily important a was

Mart our largely at redevelopment. tenants X.X%, Our business was quarter, down Office nonrenewing higher-paying bring York by while post to tenants up was business to order third to lower year's in X XX% rent due overall office the PENN compared New the benefited prior also adjustment,

activity at through market quarter Leasing in city's pre-pandemic million. of Now above use volume its third averages. turning at this now leasing during feet XXX,XXX resilient. New our to to led X.X square quarter. Year-to-date, the labor New leasing were market, continued Stimulated with the activity leases last feet, surpassing market-wide by quarter headquarters York are Manhattan we volume office rebound was XX% job committed the stands above the time year, in reinforcing feet, the employment backdrop levels of remains million Amidst million by markets. are signing commitments. office economic tenants signed and York large square tight excess Class A Deal pre-pandemic this is $X.X square where XX uncertainty, at XX the including the long-term

accordingly. quarter, the though, we As in day. is the the world acting fourth increasing the is word of are There caution and tenants uncertainty enter

is on key both their newly Most is back buildings of developed top between for being incentivizing work the quality growing. critical. amenities and to highest with in remains best-in-class, or to strong office bifurcation As the collaboration preference come businesses talent. also requirements, high-quality believe modern product is the to transportation redeveloped and for to space new reassess companies continue and Tenant spaces employees commodity attracting experience

to portfolio demand. largely these Our types of to consists capture of well tenant assets, us continue positioning

were square breadth office third feet completed of New rents $XX XX and portfolio. our leasing the starting across In foot, our square quarter, New team During XXX,XXX comprising York, reflecting transactions strong average our Chicago the per San very high-quality York, Francisco.

of New negotiation in feet pipeline overall leases proposal with square in stages. X.X Our and remains York approximately advanced million leasing strong

Now transactions and office XX XX-XX a At this mix showroom quarter square Chicago. of and we turning in to theMART, activity. XX,XXX feet leased

we a remains quarter. have in market While challenged, the Chicago seen proposal in pickup the during

Francisco, expansion As square during Morgan San renewal we rebounded X Centerview XXXX, except for pre-pandemic full at Partners. last not to In yet, square-foot the in its Stanley feet versus feet renewal year. XXX up the a expected, XXX,XXX $XX.X though with business through trade a Street, and cube show with [ we're our has quarters large XXX,XXX XX,XXX back California where including nicely quarter, leased NOI ], levels square for and of million

cash strong, Our leases. a again, the XXX continues real starting once particularly these tenants San be by financial in to positive as asset Francisco, were evidenced premier rents estate California mark-to-market. generating very for XX%

the rebound results retailers new the for to were leasing quarter, Railroad we're cash leasing Concourse, activity very the you're with renewal rents. for Long with workers, mark-to-market. seeing store skewing significantly tourism in locations. of more incurred activity daily reported continuing modest More the in broadly, GAAP redeveloped where see with search fairly good The strong and and X Island Retail bulk transaction

cautious However, more to retailer change as to concerns inflation leases. about will This them about in the being committing are resulting economy environment economic in stabilizes. new the

GRESB. as real let our me Global a USA once REITs be and Finally, regional Benchmark, and spend group responded Real in Estate sector and continue the sustainability the the survey, global a listed we estate a in Vornado office where or to all and ranking XXX leader, diversify #X leader. Americas that selected GRESB or to in #X again retail minute out companies of Sustainability publicly was on

the addition, scored as portfolio In is our earned for well for rating, GRESB's X-star for differentiator market. once tenth other stakeholders area distinction and again our and we This is time public in our Star and the increasingly reporting ESG and an our to important score. tenants received a for the A Green

the challenging had and to interest Turning aggressive is impacting balance and CMBS heightened year this investors lenders pause. lend and are We focus and rise and other shut capital significantly with right the and sheet markets, more than The lenders generally anticipated financing to market the and deal now, properties hesitant our becoming in effectively the and debt is capital maturities. to markets XXXX most the XXXX rates to causing market markets Overall, best volatility now. early sponsors.

we near-term given mid-XXXX, at largely all significant protected of Importantly, are we risk. refinancing summer this attractive have billion spreads, maturities refinancings from the $X and dealt in through completed our with

of in is active continues the without market, large and to a sale interest front, office New difficult million but while are -- Notwithstanding to stable from York financing assets market On it sell of asset sales handful debt investors Fulton assets the negotiating retail transact we there with be challenges, in to XX now. $XXX contracted right small place assets. a and not executed

a U.S. billion, and undrawn $X.X billion is under credit cash, restricted billion billion liquidity cash our treasury and bills, facilities. in including $X.X $X.X strong revolving $X.X of current our Finally, investments

that, Q&A. it I'll With for the turn operator to over

Operator

Instructions] [Operator

question Evercore We first have with from our Steve ISI. Sakwa

Steve Sakwa

kind Michael And on 'XX? of or X.X that renewals and pipeline. relates million the a color that you looking just is of little maybe much of to Steve how for in feet provide I'm how curious early new into just more maybe you? can much requirements or maybe 'XX the Glenn,

Glen Weiss

Steve, it's Glenn.

some we X.X in So know toward going the as we terms locking pipeline forward filling in today million expanding and at the cited more versus renewals the empties would then say of feet, good to tenants spaces, and portfolio. new it's tenants portfolio. look expanding tenants of have we have financial we activity. a coming It's coming tenants activity, more be BD the the I to it's will service from who due some in or with law really in sided But activity tenants new mix, new

Steve Sakwa

color types firms, maybe tech just hold, private big of assume Glenn, equity I asset banks, any managers. of of tenants, kind And but terms just law these is in on investment

Glen Weiss

Private heavy, saying. XX, very XXX our some at Yes. financial activity very And you're buildings on Certainly, ] bps, our fund equity in as financial is et is hedge very, cetera. [ portfolio less still service tech, there's strong, also active. with

So firms the getting and like are in certainly, financial buildings is particularly busy portfolio law XXXth busier Avenue. definitely

Steve Sakwa

And one commented the to if how XX secondly, something of on that's pursue the Great. you still that that then And think casino Steve, the months? in? curious I'm licenses process downstate. XX your to do just sort you've past, over you're next in unfolds desire interested of

Steven Roth

RFP, be going to they're it process. they The there, continue late The a to put And think think, it's we'll -- in how government see then that first goes. December, interested, I I interested. out already early have January. in We their very announced -- from

to it process. expect a be We competitive very

Operator

question with question next -- Citi. Griffin our from next we Our is Michael have from

Michael Griffin

that And just going you the additional expecting heading rightsize comments on dividend. helpful. the the to into you're Wondering how on can be would commentary back any dividend if XXXX. to maybe much of frame Maybe sort

Steven Roth

around, moving We mean, to And really still what guess totally as numbers prerogative. might I be a board dividend it to the inappropriate would next and year. us for be can't. it's are that

Michael Griffin

to about embedded Got million for the expected cost And going the maybe forward to it looks those was like back executing be on still those then then just the burn term are swaps? off And loan, in floating? rate swaps that it. that leave interest to $XXX XXXX. in million the $XXX or of plan Would as swaps. What swap

Michael Franco

that so X gives in depends cost swap the trade, Michael, supplement, there. I the what terms the we you in say, a on rate would is XX basis of for Page points the of that's X laid of to embedded there's swaps, particular all-in on the It charge out you credit typical.

working little you well, these not corporate bad. bit the gave that that's a numbers in you on not say that's it's less, that swaps. I And cite, we if think but I a Sometimes use would again, assumption, as level all, the term that are but embedded But all largely -- loan you.

the different to to we different we example, asset ability We asset. a earlier did, loans have that year. roll City around, it or shift it sold so an off moved those we as wanted And around sold this and Island for move we to which on Long asset. if We

swaps. large, gives But by corporate. asset and So us certain There they're flexibility. level are

some we swap, answer look at ability move that then have XXX balance. fixing so If we that not, we'll next And And term the the Ford ahead and potentially year. of around. to the is beginning loan, went

Operator

our Bank question Camil next of have We with [indiscernible] from America.

Unknown Analyst

the on front. quarter financing Busy

following the rate the Just more with to versus us in debt peers? Can thinking exposure swaps. on XX% you rate up help how interest line lower your reducing amount floating decided understand on a your you behind

Michael Franco

the use. is think not the on the in of caps right We've I number place got to Well, bulk XX% rest.

hedging desire any So sort our when we due where do X%. look exposed, beyond loans it's of you are what's sort collectively basically floating or of no rate at the JV is was net to there. end about year, coming have the that, exposure partners there of that to And

everybody balance I from think our exposure, I a got also again, cash we've about on rates. earning remind X%. want got net we've that's to significant So sheet higher

that's Some of treasury been deployed in bills.

earning with higher relationships. that's of banking rates just our Some

terms in think a So is. is it's little in than the exposure I of more exposure, even accurate bit what I X%. less that, think, that But

Unknown Analyst

you drop to pricing We quite where specifically to shifting for That's speak going is City saw just Okay. very think leasing you helpful. retail? broadly retail. this how Can And spreads a in quarter. York New about

Michael Franco

communicated retail I think city, -- we we've has over is the last view. calls, that our and the couple of bottomed in think

start to key to You're is the in vacancy which forerunner of to decline obviously rebuilding. submarkets, some starting many the have see pricing

half exposure our assets peak. could most were from at of submarket, of the the footfall done, fact corrected. have going falling leases the highest seeing And But areas actually cases, will in already. be done don't up Rents get reflective submarkets. our want beginning to market's best you're and is now, be many take when the are big leases that situated recover. X/X are best move a the that right some SOHO think locations. they're depends bit I rents time there. portfolio to be is submarkets, the to begin have where retailers this rents little we not It overall, to bottomed. on could But right a on vacancy in focused drop anymore, to in And we getting are think They be the But lot now. that they in on of and in

on going But top in depends bit leases roll They're at they still it. where New best ranking the just looking and they around is when to given on is of the be said, net-net, time. very think York I much now trend But from the the want want where the little right locations what's it line to standpoint, where are a and a So as of city caution being economy. expand spaces. of on for there and the more retailers the focused cruising I market

Steven Roth

respect we recovering retail still market. With Make a in to are no mistake. retail,

they back where to were pre-pandemic. yet So volumes are not

and buses look into traffic pretty you at basically transportation anecdotally, the subways and the pre-pandemic. the was numbers city it X/X coming railroads on at the what If industries the is wholesome. of looks although And

be healthy So years. to market the thing. to more a is quarter-to-quarter we're what is need is our in market. much a of think that do This recovering I prediction will year-to-year a And thing. couple not you a It's say in very

Operator

question from Piper with Alexander next is Sandler. Goldfarb Our

Alexander Goldfarb

you The up on a retail cash still Is that billion The on retail. $X.X worth number following did the just is have to of billion $X.X Steve, that ago, your refinance coverage, And preferred out I that, the think value flow the the do you Maybe of guys cash thoughts the think you rate as coupon that that. of JV ability years focused, in guys, get X.XX%. sort par? just number and about balance your of sheet you more the addressed view How a that position? floating of this you've exposure.

Michael Franco

Michael. it's Alex,

to try your me let questions. get all So

value it It's [indiscernible] value It's and par. the significant -- of You in believe partners know chase. so. we fine. retail par, don't you still that worth I that value terms we less JV. just think of JV In think think equity worth it's clearly still to than preferred, the remains left wrote our they're

cash we So of standpoint, continues to not secure flow retail assets, they a all fun. to coverage -- again, remind From X.XX% ups that X.XX%, our whether rollover even of -- is preferred you which And just preferred the preferred flow the whatnot, preferred today XXXX. to that strong. and strong dividend, over That from today, you, remain coverage coverage that and think the on is and be goes to expect very on strong. cash very the payment the and or coverage time in some and assume is the April will downs rise as we of to is have

secret. any The are I refinance you opening back if right, this right the don't and Now in good my ability go product to category. now, financing in out. said I remarks, any what is not question, mean, your last think to I markets

unless basically the big for whatnot. don't a property great client capital. are and CMBS it marketing rest and the to really year shutting down a investors bond banks of you're deploy want So

a don't. -- I recall market to refinance to. So it's its' we to think going have But and in if you near Unfortunately, remain term. challenging the tough financing, to

today And There's get And or so. capital -- that done to do remember, piece-by-piece, asset up, in right? don't be rates if this -- we X, on do this we'll avail the prudent. to pay when can want do not we would so to X have year the need go ourselves to is cash preferred be budget And then or it But in market refinanced and we exorbitant want not X our next that the at this on. opens time. or go the [indiscernible] to what

I hopefully, to the ask, everything hit that's current but So state.

Steven Roth

Alex, look and elements yield X to collateral. way. One mean at it the the the it. this second is I is there's

I we carry think clearly coverage the take, Michael said give is that The on fine. collateral what double very dividend the or the just the preferred is, think of is.

capital think the be. would this market what preferred clearly, is, is we market that fine. So [indiscernible] very Dividend below is collateral volatile a price in to

you short-term say a that you might less will a sold but get on it, trader than of So would par basis, change. you submarket dividend, and the that you because were if

that so it's sound think And a still the we instrument. [indiscernible] by way.

Alexander Goldfarb

second question. Steve,

As appreciate Board for dividend -- make is as VNO dividend, the Alexander's through you similar is will similar in similar I next the the well? . comments for we on year. a of boat. that read Alexander's Should resizing a mentioned, determination dividend the that

Steven Roth

No.

Operator

Markets. John from is Capital question with next BMO Our Kim

John Kim

the this to a on to cautious project week was move an York you the how need update forward? You if less in environment. use of the there's particular, consideration And the going project, more the New much office with you lot talked have any and in on provide office, to preleasing change development? PENNXX. the was an forward if would I about of case There wondering could post optimistic

Steven Roth

to the prepared John, my thanks of development question. it. the environment things. I'm remarks for going the the that And difficult. did question. current grounds A couple I up I duck very meant in say makes

and now. in into to you, have that's get of is one. what changing uses number X we're not that's terms something So Number going

John Kim

Okay.

that being Regarding other the sold. Central any the any it next year? fully businesses an tax issue. you the about I see of Park on there XXXX? Park direction will in South Central income income South and taxable you talked Are really thought XXX know your other be on taxable I next thoughts rates protection, But year, XXX pressures other so rising

Steven Roth

that not reasons going higher taxable said lentis we've to The mean XXX% budget because think primary go that I we we're interest our down. rates that are protected. shows

We have no we a have soft and economy. income XXX, from

we So and are any if you -- from sales. we're budgeting not take all those gains X budgeting asset again, that things,

I I So it. mean, that's think

time. put we probably to in reluctant will make the at a on are the that number quarter. But a current decision We first

John Kim

this And income that is taxable your dividend, year? XXX% of

Steven Roth

Tom? . What is number, the exact

Thomas Sanelli

dividend $X.XX, haven't taxable we Our finalized is income. and

Steven Roth

projection. our That's

Thomas Sanelli

that. around It's

Steven Roth

Yes.

for So year we XXX% taxable of within think that hair the current a the dividend is XXXX. of income our

Michael Franco

includes Which [indiscernible]

Operator

Daniel Our with Street. next Ismail question is from Green

Daniel Ismail

a few lack difficult and think City York transactions. curious where office of given the at is are days? answer, the you values a You mentioned recognize environment financing question I tough times New these just and this cap to I'm rates But

Michael Franco

lot a Daniel of is transaction activity. answer The

I difficult very give right? -- there City answer, I tell the in I high. all, think York you first New would to think that interest is remains you precise investor of a it's

given the it And they capital. While issues right, It as Is what's York financial is, think, attractive investor going belief you anymore? York. they some to you the world, fundamental at they look a evaluate want have around opportunity and don't the global capital. others black when got New seem see When And in their it very in on others invest doesn't where without you question, and base, of -- I looks the come New see London? as U.S. clouds, good. a Is HongKong have. global back, I think terms so.

you And had value. because market of looking who a you're right York, frankly at period to absence in in if market, sell the see New quarter, know market, I they picking this of of think for that's time. quarters, interest activity X knows? money a a then on it's in the of smart York financing you're New lot don't stem now, give X right? sell If less somebody a needs at compressed. all-cash there think it I wider financing. an from precision No. If it a larger this? impact can something be rate with impacted don't, a So they sort XX that? Sure. up it's cap But basis buyer, on rate Is points then is than you I will cap cap are There's you Can a if of impact. lot to But rate, XX%. a So values maybe that's the little going XX%? forced scouring I

got But it's assumption, say a think think Dan. anybody I reasonable precision, probably. with I can don't

Steven Roth

couple They access many We this must that markets and comments entering A the debt seen or markets economy highly unbelievably they The the the of aligning. you debt recession. on and expensive are capital that. before either times markets. illiquid, in are if recession are is

asset So deterrent sales. a that's very to big

second these is that The people of thing to only kinds markets in sell, that have transact.

the And the distressed really are controlling buyers market sellers only only transacting are are weak buyers. that the because so

given below the office The the a to to sooner X the number. will significantly mark-to-market my to can not have through every year they of and out It we distressed in have that where, you of the think. of either about have This below So this, market transactional end aberrant the that year. But stocks you live into last X go just will gone one significantly or where corrected or comment. it XX, kind portfolio, market in is and happens than make the companies X you a is are point really of capital this year adjustment. the end. But judgment,

Daniel Ismail

thoughts. Got it. I the appreciate

trending or in leases guys negotiating? a Glenn. last one new Are you are days? concessions you on where Just stabilization concessions the any curious for I'm abating these you are seeing think

Glen Weiss

concessions think have They have I stabilized. abated.

So certainly TIs helping of in but I stabilized. think you're of more terms the terms build they've out tenants into TIs buildings but space them stabilized of the getting than historically, number high", still are has in "too that seeing more

Steven Roth

they're up. building. and seeing of have better fallen inducements Rents We're anything, as have If really But on gone going market. TIs the strange up sort the not well. the a

pound market reductions. inducements to the the rent in opposed taking their in So is flesh of the as

Operator

Bank. Derek Our with next Deutsche question from Johnston is

Unknown Analyst

the employers view your will for of point tipping In there utilization. leaders, balance versus favoring office the a is discussions recession greater likely employees. And that thus, with be power business a

So I drive perhaps guess, office greater slowdown view? utilization and sustainable can your the in

Steven Roth

Street and the colleagues -- time, kitchen pain want of office will culture change The do that over that idea temptation basically don't be at table. it's I get power wrote overpower marketplace. the from transit being just workspace that came employee the in the from believe more in recently, debunked the the into the sit -- out unemployment, office. back we that people higher -- will get productive, I to have will we that's going with changes office. the a on Green recession that. recession piece therefore, where the to aspect that [indiscernible] be employer, table. to to where to will kitchen the opposed cafe the employee But a the office as back And the [indiscernible] however, I think at no is that of believe, I that view the the work and will change

Unknown Analyst

this don't And sentiment big ultimately office And another But more it. concern. Got before. just you is seen by this picture it. I hybrid one. been sidelined really think But Steve, as secular Appreciate investors hope movie to work guys going have unfair. you positive investor do you've recession. what flip on help now before. to is What seen this we longer said, have take? Like I can the term. you've REITs, Or to it likely this

Steven Roth

were buy rules the the of and believe game sell to low always I that high.

buy assets. that the on have is are there that are at market, it's to hard market. virtue in But what and is now assets So prices. we very distress the distressed They're certainly the stock illiquid

But like the I buy. We buy to family from recessions, don't time in my I investing. and mean, that's and know. And so personal to

guess So is way will but turns what's don't the for stupid, end of guys going that stock cheap. these realizing you to gallops ahead market as just are -- what's start the stupid stocks recessions. to and always it my happen. it that going before I to And know, take

do I what the the will business think that do. tell I I don't office catalyst well. -- so can't as you

Operator

next Pelon with question JPMorgan. from We have our Anthony

Anthony Paolone

And just roll-ups, amount not roll looking at maybe Can peel us a help the retail bit that a have quarter. whether as your you like move-outs expiring back it office known in XXXX or disproportionate lease to big downs? first us expirations, sense and or you a in any there's and give seems

Glen Weiss

It's Glenn.

the of and XXX to properties, relates first it of XXX. the in those that's X attacking not our of course, office for Broadway, As we're, And of [indiscernible] 'XX, out in all a only expirations. the mix Car, it's quarter, really year, XXXX

have very, the space. of characteristic in those you when tell look the some on good XXX very lease like action market I buildings assets, like buildings quality We they're will at a highest you our others amongst unique to XXX. a trying were and and most

coming So in 'XX. that's expirations are where out the

Anthony Paolone

Okay. first to the And how about retail out in quarter? there? call Anything

Michael Franco

not it's there's can't to there. definitely renew renew. rolling and is X X discussions where tell and a schedule happen I Michael. tenants The we're what's key going There's got answer could we've you Tony, or to all

right renew. if So most down likely discussions do it's even you still just give -- pretty may given some, more fluid think will be the where income I I now. remain precision renew, one too just the given fluid net-net, the But can't

Anthony Paolone

on gotten shows seems EBITDA the just about you back. have in maybe are just where Mart. then the you Can run item. trade And like some the tax on help And it. Got the rate think back annual follow-up you think I that to years, one Okay. us asset? has know It

Michael Franco

know casual mid-XXs. business we that the probably to be leaving. also going I think -- it's But today, we're in is the

comes bottoms probably the mid-XXs it so to And in before back. low

in rate -- beginning the of terms probably So year, back. we number at a run rate of to before rebuild that probably and the that is decent run a the -- mid-XXs low

Steven Roth

building potential the is top the end? at What's for the

Michael Franco

job right? release the ultimately, additional of think show. in million, upside to I building Like, some trade think our there's back get we the We So north do $XXX should Yes. is it. mean

the hopefully XX it in million. number let's think of next months, -- north $XXX we it, that So back, the gets call

Steven Roth

upon So so -- based about -- now, $XX million. right it's

up volatile It's a it down it will turns that's bit happen like, the goes asset. next into but but $XXs the the story. would and more than before happen for We year, will go we much in not million, the $XXX future, as expect to little potential million as to back which

Operator

question is Our next with from Scotiabank. Nick Yulico

Nicholas Yulico

wanted XXX to confirm just want that your I recent Farley them to at space given just see, impact news there's seeing Meta, for from you're Broadway. or no I with the

Glen Weiss

out of both it buildings relates the is of strong, There's no to no of utilization happen the are announcements. as recent the There impact they very on XXX love and buildings Farley, impact to properties.

Steven Roth

financial because embarrassing company are It's almost a from spectacular bit say, but big to a looking X tenant. meant little a credit of their they point view. this at of time we And is

which when a have you a So amount think about flow a amount cash after -- number? is they what's free spending on discretionary. million a year R&D, it, $XX of greater similar or

well is flow $XX above cash million a So their year.

debt. almost no have They

recently. did billions. have they debt like first in cash -- $XXs-or-something $XXs-or-something issue millions balances think the I their that tiny They

Michael Franco

billion. little over $XX Yes. A

Steven Roth

works. That Okay.

they a of and view, And huge a of financial so Instagram great point platforms have are WhatsApp. company. the from They Facebook,

a they're on so And mission. now off

because look the back past. he's You the have guy in done what to

So to will the is not will not a the this. it's extraordinarily certainly successful, that it for impair sanctity universe. believe new Even develop they of if be trying I unbelievable it answer are successful.

So so. we're we're friends happy honored vendors to and and where to be then

Nicholas Yulico

Steve. Appreciate that,

retail Just one JV. other question is on the

like the confirm in at in NOI also today to feels actually when see, a rates cap rate, the that. want a based at is did I at you are it you the impair I think know back be to but it going then And up the supplement, NOI -- bit. that might similar deal actually, look correctly, the the struck XXXX. But looking I'm investment I original cap was it very in on deal presumably I XXXX, when was mean, this on So I the struck, just everything higher in when X.X% world.

the from So the if value on should is just impairment any the you that had there understand to to do that? of possibility of annual the trying dynamic when JV, think test we

Michael Franco

from terms -- when bankrupt, then. down [ recollection have of as the because since deal, Nick, versus ] in the number Forever portfolio the when probably little of just down from on income vacancy struck And I we on recall, a ins the you is now the me. the may in is XX of My so it still that don't outs front numbers exact in and knowing went struck. and was deal they're bit but so space, Fifth the had original we X

But like is now down the than struck net-net, touch. we booming right a the it's signage So higher I think deal. probably frankly

has the be correctly roll, durable. point the And of some But been but you some -- impact. very out, income leases there'll

of I'm impair In Again, the So I from Nick. did going XXXX, correct. -- in impairment, think it. and memory, you're terms we

I behalf answer an that the assumption. on the But venture, look $X we every want deals we what we drives it has give do without of independent south impaired is, And the frankly and appraisal provide There's billion. at struck think of their performed sort number I of don't front million, -- take that. don't the quarter. in -- that's me. fair having that. to They at you original it have we and third-party work, which of the we value, the independent we $X.X it look,

So of end their we'll the they'll do at the year, work and act.

whether predict can't I be. So or it won't will

it's whether But and you the the significantly. any [indiscernible] our market market there accounting certainly given how in -- be impaired comments, will is stock it's your can't yet. I is comments I impairments, think given on certainly tell priced further

Operator

Stanley. Kamdem from Ronald our Morgan have question We with next

Ronald Kamdem

quick ones of me. for couple A

leasing to the about back going economy you maybe forth. talked slowing the and activity, so Just

color from by Just more of Is of could a hybrid bit and sort subsectors is was the side the also it hoping it tenant you be economy? sort provide little helpful. would

Glen Weiss

by the activity. tech economy, I you, techs certainly is this by We're specifically. discussions. medium-sized I those. in There were generally, hesitancy more to due in a the more market are couple more think of certainly, more much seeing And the the sector, will quarter hesitant for small tell a some But economy of there that think so I load. would [indiscernible] sure. to leases CEOs couple hybrid, caution, tell big I our not you by to the signed due

Ronald Kamdem

back then you the talked decision to And Great. of Board And about the I sort second they're know it's my just dividend. discussing. question going was

Just trying is to just -- and understand of what then the pieces million that CapEx, cash or you're are it plus about sort $XXX it of going trying minus to I'm into sense what to sustainable a that. flow dividend thinking to operating Is the a to the to get get for we should be right that for solve basis? land? how still thinking of just at for looking about place

Steven Roth

anything have to dividend said. more than the don't on I've what other I already say

get Board to first that will quarter We at meeting. the

do one their and the dividend business. everybody think guesstimating trades I'm little factor I and X% I the that but and can not tell guesstimate, math between is the own rate. can XX% you spot

what this So I'll that is think indicates something wrong. I But I've that said. stand with already

Operator

next question Malhotra Mizuho. Our from with Vikram is

Vikram Malhotra

like few are a rates-wise, feels get thoughts level, what fundamentals. improving, work swapped years a things you I want a calls, and seem now according lot guess leasing inflecting rate picture of was of just improving. bigger last X the to return first, to the micro contemplating maybe on have a cutting is contemplating at you're dividend. more been with you've debt I to your at But -- I'm sort just for to macro-wise, just then It Steve.

dividend just the but us I'm to wise you micro issue, and swaps? in more in what all of bridge can actions, this a said issue so a than like your you term, near it's X-year this balance it sounds to X-year are trying like a forecasting it's And like X- to And X-year issue. help X-year you macro-wise effectuate this

Steven Roth

economy that very destructive. obviously, to so it's hyped see. Boy been oh let's probably the boy, has --

for So get it. about their politics, said, but is and runaway -- as want and to job have we earnest different I And different for whatever deadly reasons, that I is other into this reasons, don't I doing stopping inflation. think

rapid by cetera. #X I So rates. a the of market, et had is an mean, their interest whole tool, enormous stock The rates interest already as the market, effect have manner. course, very illustrated in

In going a is to of it fed runaway We exposure it's reasons, the protect which multiple how this different protect long against battle. the to floating most rate was win interest the takes. one rate a important our So went just for end, of aggressively matter environment.

that was the sort covered. we most of execution think had efficient The we for So years. swaps X

firm do is did we -- upon that. our did And view X-year the read There so this into we future on based basically -- number. not anything

and -- have at the at -- they expect up recessions and then would bail economy they steep the put out. I if of past and at because have quickly you down generally I fairly look curve pretty look and activity, into tell go aggressively you to they the that come graph chart recession, past they then they a it

we -- life anything. bet we what expect our but happen that's going we So won't on this don't time, is to

our So think protected our to We balance not we sheet. think appropriate. dividend is overpay we've

actions this not financial to to proper X-year the is X- taken bit, the a of that to sanctity we've the X- a be event. We company. think to we so a And believe the going protect fact that up fiscal X-year

Vikram Malhotra

fundamentals that macro outlaid, your office the that year I'm opposed X so just to assuming. the in on is X And to comment more as you

up on I numbers know Just I'm so that. moving the are following not that... around asking

Steven Roth

Vikram. to on, prediction. is Hang X a years no. The macro No, X No.

Vikram Malhotra

And how fundamentals be Okay. frame? will fundamentals in that square do you where office time

Steven Roth

York-based. we with the -- of all, York, of We we we've first Well, are and -- and lots over believe employers New of lots believe all world. anecdotally, in had New from conversations

to capital here, to young is the still United want States. for of here. be York. sure, the believe people still be York want we And It's New New companies

the they Just extremely and all to children my that's lot have them, moved a when be because where their want in New that anecdotally, children I'll out [indiscernible]. are, in of Florida. you tell York, to friends New you ask York But are

predictable think there and will industries locating there be fairly at different -- interest will that an aggressive is rates, in but a we to So be in different cycle will grow New York. to York New growing this continue where

Vikram Malhotra

just Okay. X quick... And then

Steven Roth

We District. to the New what strongly think that center PENN success. another and about doing that, of is convicted in an absolutely be extraordinary are we're going We York,

So very that. very, very, we're excited about

Vikram Malhotra

to going are numbers the before I was you to I ask that. But -- thing just related That out. Okay. one that, moving know

cut think to like numbers be, historical look the it year? But at payout where I'm with be. may a a in line as model AFFO AFFO dividend should if is So or historical ratio, we to we whatever going assume is to the asking not levels assume payout next we -- fair

Steven Roth

approximately. penny, to If that's better you're you income, if And man is be taxable going what dividend than a the that can model model are. we the could to you

another got go. full we've quarter to So

process. the We're in we're we make so And nowhere the that first decision quarter. in will there over. budgeting And

Operator

Sakwa We Evercore have from follow-up Steve with ISI. a question

Steve Sakwa

financing I Steve, doesn't lot private seem very big on you gaps big, mentioned about markets that discounts very rate. price foot, and Historically, But today, we've the in square there's you valuation, per and guess, a given seen numbers, implied high low equity I'm persist. sure trade close likely. in are that of come at sectors where the cap where

time be Or So and to wait of to patient are gap? you've there for and steps got this you are try just markets that take? that where improve? close financing steps kind to contemplating a the there is Or you're can

Steven Roth

that I almost too. to want duck question,

may our company me buyout can't in if value. extraordinary it. Let -- model, The it its and How I see equity is value something not out predict debt and or the of work parse all this is environment. now. there, can right into plays The leverage that's I may that has which

Steve Sakwa

which in Well, the into I separation was maybe PENN talked a you've about hold. I of guess the District spinout, the know on assets past

seems meaningful buybacks be buy You stock, need a do difficult. to to sell probably assets which to would you back in only able but said you way,

just tied. just could it I'm that missing you wondering, we close are the here hands help So like to are anything seems your do gap.

Steven Roth

sheet the and of the priority. #X is is spinout balance the protection our on The still table,

Operator

have We in further no questions queue.

Steven Roth

and you all call appreciate Well, next when? you thank joining us, much. very We the is

Michael Franco

Valentine's February Day. XX. Tuesday,

Steven Roth

call, says Day. Michael Valentine's next Your is the lovable

yet, do very Have up in guess down on the by PENN. way, or come Thanks invitation take thank through great our red Thanks advantage seen you all much. is to and for my the we'll like you you joining. a there very see year, the down of We'd extraordinary. you those all you since who we're doing. I and show Valentine's get it much. take of haven't toured here. day. please It's what to So rest And And of invitation

Operator

Ladies for participation. and gentlemen, this concludes today's you your conference. Thank

disconnect. may You now

Alexander's (ALX) 1 Nov 222022 Q3 Earnings call transcript