VNO - Earnings call transcript Q3 2017

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good morning, and welcome to the Vornado Realty Trust Third Quarter 2017 Earnings Call. My name is Adrienne and I’ll be your operator for today’s call. [Operator Instructions] I'll now turn the call over to Ms. Cathy Creswell, Director of Investor Relations. Please go ahead.

Cathy Creswell

you. Thank Realty earnings Vornado third Trust’s to 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 package 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 for refer Exchange XX-K more and information Securities regarding and filings to with these the Form Commission, including our risks our uncertainties. information today's as sensitive accurate The include that date. call of time only maybe may undertake statements. The update duty a company to does any not forward-looking

Vice On Investment President, are today Franco, and Executive to and Chief of President Roth. Also Officer. now comments Joseph Division; for Vice Executive is Steven Administrative Board our Chief Officer; the and Steven Roth, the David Chief room I the in call the opening and Michael will from the President turn Greenbaum, York over Executive of call Chief Officer. Financial Officer management New Chairman Macnow,

Steven Roth

increase. compared last $X.XX $X.XX a increase. per to the outstanding the the quarter everyone. industry Washington. adjusted XXXX to with adjusted $X.XX as share was XX.X% truly truly that quarter very results Cash per year, RemainCo to New without leading. Thank start compared share you, Cathy. Please Good York-centric for morning, as last quarter I and FFO outstanding $X.XX is call. comparability are the financial share share this were for year, Welcome first was we FFO per which a will quarter Vornado's reporting GAAP for third Vornado our strong quarter note X.X% per that third to

industry leading. outstanding Our are and also same-store metrics

GAAP, X.X% was X% in positive XX.X% and XX.X% positive California positive was was positive and New and York positive GAAP positive Chicago theMART GAAP XX.X% XXX Our EBITDA segment cash. cash. cash. XX.X%

in outperformance of Vornado deck focusing the Please York our Page of among of quarter's my growth been does. if centric I it dive RemainCo NOI peer validates same-store This is see This the of are here since one in of RemainCo's blue David XX charts. deconglomerating leader September past our XXXX. has on performance business. favorite our think website. on all the chip New XXXX shortly, strategy matters, And will some and highlights.

square average XXX,XXX a feet, Mark-to-markets at square XXX,XXX with were per leased office GAAP and share York XX.X% record-breaking outstanding. $XX feet and New foot XX.X% cash. rent that's starting

last coming square across Square. full XXXX in manner which their from We invest to modernized, understand the up largest Safora to existing Times at at leased Safora's store Penn footage grossing all we and U.S. across retail business, attract the our all [indiscernible]. XX,XXX our few street structured years at will well-positioned leased square New Demand in extend buildings, York this and feet This trends Broadway of Chelsea have New a from in Hudson I our these South. York for in from is XX% will so are Plaza foot hottest is street be our that their through office portfolio including In space West half Anticipating tenants XX South We office we district. the is U.S. is highest year. in island occupancy robust our are and in square users. to submarkets we of and replace they points XX,XXX town the the basis on and Yards the to store the phrase Manhattan ago of coined the market Today tilting run A sectors. developed

As foot national with of square a David are XX,XXX Broadway. we final moment, drafts major in into retailer a a also lease in get will at XXXX

these Times properties sides two on the at of are two we the [indiscernible]. Square With be best platforms will our which XXX% two leased both deals

was New XX.X% Retail York and up single up GAAP XX mark retail cash. is basis last the of X.X% victim positive occupancy XX.X% quarter the from were for points negative mark-to-market negative a quarter. GAAP The Americas. square a adjustment we SaaS XXX of Avenue rent renewal lease building the midblock was short-term foot the XXXX. in The the at when XXXX acquired marked XX,XXX as expiring on share, a

letter continues general annual We us race, laid my cash Excluding I having wins I three shareholders the the the X.X%. chose increase quite on the even of XXXX been to success on termination would our reaffirm an Times to Notwithstanding states. on the recent the way XX XX, the Square York bank have our by through XXX on as and year have In estate basis retail said tenant redevelopment same streets this business guidance. right depending of early rent GAAP that I soft. before views including extend positive my and Pages which best guidance retail particular branch New general for the retail today. real SaaS on that last adjustment, with in to be years out the market demonstrate at in

irreplaceable the unique, are term, the world. tenants the of as buttoned extremely great higher. may is on on where Avenue XXXX great are quality assets in majority and great In couple our retail Time Square will with they even [guidance]. call, I Upper a These I year's that last of highest percent of Fifth up show what value on retail fact, scarce, budget for repeat our our assets, said come are

REIT. interesting below-market Fifth a Zara is Avenue, which Avenue Massimo mid-XXXX our only in Dutti that an have store, years, In and being of Upper lease five at fact. a our Square we in next the all properties, Time XXX Here division expiry one expires the at Fifth

of caution, lesser brought the buyer of being a Investment product in refinance Twitter, electing rather market office evidenced down John's to year, owners is sell. and and investment quality and Red to strong turning pricing is largely financing sales. from Bull to activity function sales South last markets. recent Manhattan Now West very located and the as than building St. Demand from by assets appreciably

York sales true in very buyer suffering as to domestic opting remain asset pricing. manner while that also to pricing strong been were from all with if and brought of interest flows life skittishness. worldwide sell. owners [indiscernible] the are ever Moreover, capital strong from We even markets refinance would be has on capital CMBS, seen trophy in this a ever. And as competitive to slowdown the sources are it liquid strength market, rather believe and are that we and investment and said, Retail I all have be recently, many just much markets for as discussed as foreign. New open robust both New assets continues Chinese assets of relative debt York markets Bank, as markets given that fire than the BPs Debt at companies to

prune We to will business. continue focus and the

South. that several over $X expected will from next the another be billion selling the identified have assets Central that not proceeds does include Park and XXX of years we We

thank for Let than good appreciated. want mid-August. surgery now have me while everyone am I had to for by in much many wishes, I you a to bypass better now. and been conclude very of I you. Thank saying work your new know as back

Now over to David.

David Greenbaum

and Steve everyone. thank good you, morning

on As quarter few our in and thoughts deeper activity. start into I'll offering third by then last calls, some the dive market our

within services Office the we online with as employment first XX,XXX story XX,XXX is year for track. the one well critical estimated be using start strong level. me to the services, The measure finally and years. next as new XX,XXX business absorb had reached third pre-financial like five in the this we employment in Let quarter continues resurgence growth see range employment which well annually over through the the that to supply we its to in needed new jobs third crisis professional and of quarter as of financial coming which

to to positions jobs. non-tech That however in tech is growth by is not signs technology decline Some these continued a modest very within jobs this were that companies. in All of offset say point dropping. in [TAMI] city employment

jobs last quarter, report converging on new on Roosevelt continued the to companies in are and an of ConAgra date jobs XXX,XXX same are people creative to old banking. the to That’s retail group driving buildings to are talented York Allstate in array of better one university state of XX% by that And both pursuing class just opening talent XXX,XXX industries reason comes is century-old the comptroller discussed can healthcare years and A of that insurance it strong and New I Tech As recent attract over ahead tech to from technology and the Cornell professionals. growth campus in such estimates that when out recent as Aetna, traditional young with companies efforts there City, to anticipate of including Islands. jobs underway. cities the

On the third performance been quarter. through market robust the front, leasing has

XX to by X.X%. X%, Wakefield the in Overall rents quarter X.X approached asking leases We our million foot, And year-to-date approach commitments report valuable. XXXX asset “The absorption X.X at Manhattan's by to office XXXX entitled million the quarter Accenture believe in basis in opportunities unrivaled positive total and Blackrock, our Total and square With major the town space West. the JLL's buildings of well state million $XX sublease an in feet all with citywide “strength our reached leasing its more average Side Penn existing of Cushman performed and new this leasing and is and improved see by feet reports. become Manhattan declined with to the lower”. can higher they Yards square square Plaza record more highlighted continuing drives market positive completed. a now were was of transit square in leasing vacancy and XX lease recent on West access of per both of third and Manhattan in feet square million uptick XX.X You track when continue points in Amazon brokerage absorption” third feet vacancy on development Manhattan most Hudson leasing year in leasing

square the me the We feet Let full breadth leased rents up the numbers, leasing of over XXX,XXX with our remain we portfolio. our very the of $XX digit quarter. assets $XX or quality transactions. quarter our or where of rents, we new triple With We strong Plaza record. at of to XX%. XX XXX,XXX now to and space office multitenant XX% our One a XX Penn square quarter feet a average points starting achieved starting of basis third that average a in portfolio and in office turn both foot, had occupancy reflects activity our

high the large part term average on that which were While lease RTI's commissions and XX side of is the leasing approached a years. reflection in

mark-to-markets Our efforts. These XX.X% of remain of strong a GAAP success mark-to-markets are redevelopment and cash. XX.X% the the result

Over past quarter cash. and mark-to-market since portfolio X.X% start XX% industry-leading of our XXXX also and And XX.X% the years third during office the cash. five XX% portfolio in same-store remain numbers and the have GAAP office the GAAP averaged at

is mark-to-market over performance As building XXX,XXX an our cash. floor space dramatic again XXX,XXX for we office skylights high new of feet platforms the of plates extended see retail the at period same-store with partner construction From Skanska hall. averaged square elevators. for and level transform has and same-store Moynihan with hall industry-leading creative In the remained the openings Plaza train an become of and down XXXX X.X% square have our ancillary that feet two will X.X% station unique the enclose cavernous newly has where GAAP five train the now Since to the that main work mid-August, XXX been can hall the best-in-class start Governor well growth years major of into busy soaring time. In to our Penn of Cuomo on street the escalators underway train building you Penn celebrated space in space. construction cutting cranes the foot Farley

been and asset the as office spectacular. for We when this to for amenity response a the an one. take tenants potential unique has get introduce Manhattan. It's brokers foot the truly a up square onto deck we early expect wow, people have for as the as heart outdoor Imaginary roof of you'd and actions we roof space and in XX,XXX the space show them begun

we accessible commuter to submission pointed or our you years for front place our square expect, As at is and Amtrak XXth see released already proposals rail across accommodate in by XXX,XXX airports. Farley proposal With bookend area in will to the lines, three or host center in the was to that win and Midtown long-term own an the and West city West New grow but have own city in regional front to would could the materials additional center for significant building in plan Amazon's lines sites our a to development inclusion Farley to York Plaza room holdings, the feet Penn sites by West city's two in existing in the public all come. XXX,XXX the city with to pleased HQX out to HQX square district feet buildings Penn The and street Street X needs were from Farley not, significant XXX,XXX raise the in was XX Manhattan anchored square connective We noted the the Amazon Plaza four in that district. subway and near-term headquarters. Amazon. Amazon's with committed direct the that in Penn We having Plaza Amazon feet presence the

occupancy, With are end amount negligible full. XXXX we year At expirations XX% of we the the office of have a lease remaining. approaching,

and single XXXX. XX,XXX modernization the feet we to lease finalizing this third XXX,XXX Plaza. Penn available XXXX quarter our redevelopment years currently XXX,XXX for asset One spaces largest square in square Glen and the store expirations in fronts, in state-of-the-art Our We relatively lease quiet square now see continues feet of of a in and new team two Plaza, Penn One are including space feet lobby, next Over concentrated a address and of is a our total plan and infrastructure. plages, amenity his block of over expirations our where fourth are

XXXX proven We just few. Avenue, our street to XX assets, a Avenue, our West XXth at and Avenue, Mart, XXX track formula name Park record XXX have for Park just repositioning the look a at

We expect summer. redevelopment commence Plaza to next of this One Penn

with as irreplaceable highlight heart of the Steve in the been Street High lease activity XX,XXX completion business, at Broadway foot of XXXX Safora retail our square Times of the to bowtie has Square. Turning the mentioned, of at a our heart flagship the

leases was office buildings national of We we the major in related feet the The base retailer drafts final XXXX. and renewal of of mark-to-market X.X% Steve X.X%, were GAAP. another lease for square the cash our as for a A for GAAP adjustment, call a XX.X% FAS business also flagship in at are same strong our cash mark-to-market, balance XXXX. negative at the Retail" leasing "High for a activity with to the mentioned XXX positive retail the purchase a XX,XXX would of quarter remaining what XX.X% two retail but back and store negative that Street third for our Street solely attributable to not made quarter positive price numbers flattish

several where Chicago, leasing benefit theMART years. over Let turn last efforts the to to me development our in from now our continues

we demonstrating a quarter cash. and These a average of over at for stands foot. XX.X% and to and the of starting Occupancy $XX depth leases, showroom for represented and tenants roster. rents join space entered blue-chip at third GAAP office into mark-to-market expand feet extraordinary exceeding During retail XX% and XX.X% the the leases XX,XXX square showroom new by XX% tenants space our existing to looking for seeking office,

the of process in best-in-class are taking tenants more we XX,XXX space. ninth space the back result, square in order the a apparel additional of showroom to As floor from office create an on

average at XX% That’s our and our gap since at over years. average for looking XX.X% York Our mark-to-market the were XXXX, been have leading industry cash. the our for last back GAAP same-store an positive, to XX.X% performance, theMART five New XX.X% quarter Similar last years cash. the for numbers and theMART third numbers five

been average X.X% same-store even over at theMART past extraordinary GAAP growth at X.X% basis the has and on Our years a more cash. five

and on averaged last a repeat increases of time. annum years. a more each both the have around At GAAP through X% five me Let that theMART, store our same per cash basis one

Montgomery, building. at deals back Montgomery year, leases bonds with years with it XXX XX,XXX a XXX quarter, of floors few total leased completed representing to we’ve the building you we a quiet had a square active five just was the While that was $XX rents. good we this location now XXX the historical this class year. and I building completed out per $XX D XXX foot. starting building only square of $XX great at the X third floors during Street a at quarter modernization for a rents We our earlier Having were those Last quarter adjacent two Street, California feet. told

have We this negotiation for in of of up floors term this left sheets complete and leased asset. we’re just And to X all for space.

just leasing me a a the markets renovated I’ll health third is Let this performance reflection of and the of turn city. is portfolio that quarter in both as in And that, the to our continued growth strong our by conclude area concentrated the saying, largely over with well call of as Joe.

Joseph Macnow

the you year, remind results quarter third XX July I Vornado reclassified we the completed of and to our of presented, quarter. good without for everyone. included Thank the you of David, RemainCo on that our spinoff along in $XX.X all with Washington Washington comparable and results periods business, non-comparable discontinued this have accordingly now of items operations transaction morning Washington. been cost million in

our comparability Cash our and proceeds, strong. Another in to what the them newness Vornado additional percent, say. page of REIT’s quarter is third Pennsylvania shareholders, trailing supplement adjusted Pennsylvania million XXmonths RemainCo. March of in information, as and includes for occupancy David XXXX. outstanding EBITDA leasing X.X%, was Steve And positive FFO for XX.X%, X. for XX% We Springfield metrics, mark-to-market, comparability reporting quarter this in regarding FFO leading Mall as improve this our industry pro partnership and operating the very continues effort reemphasize to led of into high I the when sold disclosure forma non-comparable in adjusted same-store we quarter a cash truly received of the is the all for trends shares on $XX.X NOI the NOI results a impairment on to item non-cash REIT. our part up as

a Specifically, leases $XXX.X quarter well as of summary signed revenue commences, of equivalent. by a incremental we’re as providing million GAAP $XX.X from

$XX.X a spend disclosed have also revenue. to We of incremental to be this remaining related million capital

rental X.XXX%. On extended, our XXX loan We X.XX%. plus were realized and October September loans owns billion billion On $XXX at approximately building six cost. are resulted from net on owned XX, revolving realized refinancing. foot XX% facility, August venture our of share financing executed. The debt over extension matures joint remaining million, X%. and matures two credit of of consolidated six facility facilities, turning debt other loans, and points. of course and was with owns This billion from has consolidated of entity for partially XXX,XXX Plaza, matures XXXX X.XX same the joint million, a $XXX Manhattan Now, at in I’m LIBOR plus mortgage tower, completed owned rate This office July credit net which The we square us interest-only Avenue to interest has no Madison existing X%. very interest $XX of proceeds basis maturities we owned to X XXXX Independence November We The months XXXX property completed or of office well refinancing. owned XXXX $XXX.X in as our LIBOR $X.XX the Park Tribeca three with repayment activities. a in fees at approximately closing interest-only The subscribe The with and that share of million rate of XXXX existing which has $XXX.X our entities $X.XX million RemainCo loan seven after XX, XXXX, a the our extension was complex maturities. the February XXXX, January revolving option. rate one plus LIBOR by largest and a year X.XX%, interest. XX% million XXXX $X.X unchanged unsecured and million. fixed in million, XX.X% maturities Vornado LIBOR $XXX and to plus month August XXX are our a fee previously building interest X.XX%. is that is $XXX as residential XXX-unit remains encumbered facility million as facility's in On repayment partially interest The a two Avenue, foot XX, extended option. which lower closing at after proceeds plus Manhattan ventures, owned LIBOR XX square extended

rate are which the XXX cash to sheet "R" to a Us weighted on turn In securities marketable debt with $X.X Central rate debt times, maturities. call floating back South Avenue on partially of term restricted Steve. cash XXX debt we $X.X accounted and Toys Excluding entities and a Vornado debt the of undrawn the a of EBITDA well our a spin-off of comprised contracts modest will as net years. JBJS staggered rate account $X.X Office to billion debt have I balance debt based X.XX% and with XX.X% credit Fifth billion Consolidated of share closing, our and is EBITDA facilities. of and XX% cash, and of now debt liquidity Park leverage years, Post X.X and closing fortress average interest our X night's other financing times. including revolving to of owned debt than to average billion debt has in to is Project weighted rate XX% weighted enterprise fixed cash net our price. of close, X.XX% is weighted value X.X with average stock will signed Debt last self-liquidate of metrics term of average consolidated X.X

Steven Roth

happy We you. take your Thank questions. to

Operator

question ahead. first [Operator the from And go Instructions] from comes Manny Please Citi.

Michael Belman

several that $X the you sales talked And billion from clarity in about potential I of a Manny Steve, with more your opening here the think Citi. we wanted And of It's billion to years. comprise said of little next proceeds? comments over company. what get versus some Michael net I to you've the from $X just the Belman that proceeds of pieces in terms gross are bit big

Steven Roth

the your think $X billion? Is question is that question I what's your in Michael?

Michael Belman

question. That is billion $X the

Steven Roth

are to got be mean we've they going Lexington, REIT, et I for which sale. stocks are Urban XX Edge some So cetera.

we've better could a the common be billion got stocks. the So part it $X.X of of

We have our are several to the not JBG assets and were Washington spinoff market which the which in Smith contributed in basically are core. not

those whatever. So to amount

We do, cetera. have center that et have some sold debt we positions that we shopping that still will retained some are coming be

Number from So reasons doesn't protections, when of the over tax lot which include than be, because completion expected very more, locked you comes billion cetera. $X some of the that have the number. will regulations significantly than of them South from Park years, added out other all proceeds significantly a billion, one. will et And But it some of be to XXX come spinoff well some over more that. sales next we have them realized up, a over $X number significant more what's quite some Central several the will two, as

Michael Belman

XX the redevelopment, about bit do. talk there's secondly, whether that starting Can about to talked XXX would more plan budget that agencies? of a of a before sort redevelopment next do open then other government different you and things that waiting you're of lot city go from to for anything funding want little to the the parts and you're David And the get that or going for you total there summer just some you from is Plaza of state forward to

Joseph Macnow

require redevelopment by The Penn city planning. does actions One some

half although about those even budgets actions redevelopment of on. to do expect the of in expect Steve, approvals. wanted commence We in we final at place the fact advance the you this year have second program comment to point next in to in those

Steven Roth

Plaza don't still for - happen Well David around conversion the building. some really the improvement we’re we asset major have to we bit city so which to a little it’s said. The our of jiggering into let serial space that if think the that did and we we will of approval, me proceed what public involve did planning just tack it the that that of benefit approvals on we but a reason happen in If - that won't untoward that okay. get redevelopment they

we at So as basically look unconditional.

not we to published yet it it we be quarter. when respect with we publish the likely may report Now in will and the have – budget fourth

Michael Belman

And Steve ever. it’s great you're that than back better

Steven Roth

Thank very assets square One space way rentable now Penn, respect is starting a you million By we the Michael. achieving district with dominates much feet it the are X.X to One of its massive Penn $XX rents.

for So asset this the the of future aspirations very train is sits very, top the right we important very, on growth its high it asset, and an station had of asset.

Operator

Please go And comes our next America. ahead. of question from Jamie Bank Feldman from

Jamie Feldman

at much are years looks for Square. over Can I like same-store signed and thing outlook think what some given guess through leases talk you you the kind you gave up? sounds things the buttoned Times steps but that it on lease you few like potential have works pretty of next the spreads as the leasing retail through I first the you know in

Steven Roth

You're or retail talking office about both?

Jamie Feldman

Street retail.

Steven Roth

the the would with it's think that retail Street retail is cycle this we the said one this second doing level ends street we period we into so - can retail. until year a weapons. believe, go soft hold we be is very we And will now might if that We following challenging well. for say environment street

retail low great this an basis have street extremely we green one, number in portfolio. Okay,

So this portfolio. be we other have very, competitors competitive to low flexibility don't. debt that Number on two, very we have

which don't portfolio put or against our the six debt Square XXX, five assets and assets Times debt somewhere take that. odd flagship some is you more Avenue that have billion our have of times is If valuable dollars which than we our together, of that $X are Fifth you billion on assets we at them

So maybe debt on we have below XX% these assets.

those So position. low us in a debt very competitive basis low puts things two

have. are marketplace Next, in assets very best that these assets the and assets the to these need the are retailers

competitive. very us makes also that So

long-term Next and Fifth we of Times leases have Square the Avenue assets. on all

Almost leased is our are leases look good mean credits. recently you with have years that retailers term, we five them we and I have published this for that I those of had $X said next very the great portfolio all one are I very, think very in million as extra upticks GAAP We is or and all think we in up NOI. at if there we and

Joseph Macnow

NOI

Steven Roth

$X will our some retail books to of which portfolio portability million the have We cash degree. in protect

relation multi-hundred over lease be Now be there insubstantial. in going to of $XXX rolled insubstantial coming million and million the will to dollars they they are out, will I in be mean income

for we portfolio compete, strong keep are in we will very, very position. We we a think will our

Jamie Feldman

then I peak in would sub say about thinking as guess the you're rents the And key markets? future, versus are where the

Steven Roth

shortly that's the mean that any out characterization that deals very are be have a thin - not within that leases the atypical does within that bloody and spitting you Safora I'm lease very we price while clearing can top if talk very, they’re retailers which in top are trolling of where being this expect words the not a and when have that be so Times to signed tick two believe distance okay they and in there tick. saying which about unnamed are we our the of lease here make Square. very for The is the - of spitting there few difficult market there fair may are be lot few what Jamie the distance made they very very are money portfolio. a that We look of rents no you okay, could tenants other that is tenants to can I there very tell I are

Jamie Feldman

just then last, assets Street Taylor or city? the either work for your it or thoughts & And deal means we and any XXth what retail in office Lord on

Steven Roth

I XX% as - I work think about doing think well. we that’s but store it comment valuations, to year's is we & think transaction fact or wrote they’ll We & Lord think no good. we whatsoever closing their be have we in down to that this Taylor think moment on that I last either that that so closing The shrinking neighborhood, of unbelievably I and us. we to was these know or letter, happy even Lord them driven a my them obviously know maybe won’t Taylor a improve, of recapitalizes what previous they're entirely folks impressive. will I and them we’re financially is welcome

Operator

question And from Stifel. comes our next Please from ahead. John Guinee go

John Guinee

than Steve, congratulations, assets better question? new the is are new better CEO and than

Steven Roth

Is thank that a well wish, you.

John Guinee

and DCE more? about probably that cash a me vibrant business DSPs flow is to given fairly What matters about SO your rate well looks a matter like is about wish. million your run XXX you $XXX less discounts That year. XXX would about think includes cost that million on around G&A him XX is grain a and XXXX in NAV your million G&A Joe million,

Joseph Macnow

and services supply reconcentrate income of income have fee fee G&A. G&A. to Edge We and We you that Smith you that I to us reducing gives of We better analysis supplemental which understanding. Alexander's to G&A. assets our service plan and income on the will JBG that that shows us supply still G&A publish We we of tell in shot a Urban fee lot G&A. to shows services a

net real, we to job of to we’re want it. committed on we but is high have to work real on rate better portraying of that do work G&A to you So it and a

John Guinee

then going transactions? to your tax tax you all stock without on hit your LXT Edge second these able sell a to are stock the your issues REIT these be or stock taxable incurring Urban Penn question, And are

Steven Roth

is is the XX% - basis price. LXT we of about that have market

XX% taxable, one. so Edge? Urban On be will will in Urban our that small, I be proceeds what's step Edge, think there the of sales basis So

Joseph Macnow

tax. No

Steven Roth

What?

Joseph Macnow

tax. is. there sorry, tax Urban on No I'm

Steven Roth

looks unknown, the Urban It REIT at have we Edge. looking Penn value protected for Edge like REIT, Urban tax XX% Penn will of think XX% taxable. basis for what? is market one And I just the last So and be of

Joseph Macnow

tax. No

Steven Roth

It sell is protected, can’t tax we it.

on tax We a basis sale individual have REIT? on a lockout What’s until passage. Penn the

Joseph Macnow

from us Penn to taxable of We allocated sale REIT. the won’t have income

taxable gave talked the distributions before, you heard gains, when Vornado. So are carryovers of was was the capital $Xbillion would some loss $X cash Steve cash you billion There just talk which number to most retained we Steve about about shareholders. But of you other absence that the retained. by be that

Unidentified Analyst

right. Thank you. All

David Greenbaum

way These most maybe proceeds. portfolio. in to in able the Joe slightly correct. different slightly of And and of John, assets, and assets all retain that that sell buildings me our even these our other absolutely these all say let than is assets we is are are of most of almost

Operator

Malhotra Morgan Stanley. from the ahead. And comes Please next from question Vikram go

Vikram Malhotra

for back well brief Congrats and Steve coming well healthy. as

reported In retail portfolio York. challenges out we bigger turning? different. and in business. In other of are Real rents where way, are kind on broader the rents the And is at in things we any New are asking your follow-up submarkets correction? your there opinion, are have down signs Street that Estate the we retail you how correction? and in come monitoring? laid is Board the in well a view, with as that Where What Just Vornado by Said least you seen the certain of

Steven Roth

Yes, sorry There tenants. there in pickup I call is to the activity. bottom. willing were bottom I Fishers that are a am market, a into am coming about not

Vikram Malhotra

as then a up. just And follow

of color of the that Penn as on give on type large perspective and with the make you say, that’s the large redevelopment Let’s Amazon us comments maybe having give some tenants? amount you Penn are that come your Can of through. of well. color some conversation Plaza us demand for the the Can And Farley there Plaza. may is on Some with does area? Are types that you headquarter users deal space of includes you needs not discussions sure or, conversations having which this in space?

Steven Roth

demand, about in there we that talk to they're answer in position on not any The is are speculate conversations. to a any event. is But

Operator

from next from ahead. question your And Sakwa Please comes go Evercore. Steve

Steve Sakwa

in side. guess kind just what on urgency done? Can with you of of of to due XXXX, office kind just sort about And get sense renewals the to David, on talk tenants kind of And the XXXX? like are of I discussions today? you trying tenants early where just of deals, the is coming maybe having sort or the is that look dynamic

David Greenbaum

Listen portfolio. vacant the portfolio space I have, the portfolio. is square of the What said XX,XXX is in a largest entire our multitenant piece we real single feet earlier

feet, look couple it X,XXX all next these over is expirations the with tenants that And we the at of the you have have XX,XXX up tenants time. are that as much we feet. have So XX,XXX regular feet, of coming years, discussions that

right square as of of feet. in some have proposal And the with We XXX,XXX, active are going tenants out dialogue tenants forth. in in the back new well as XXX,XXX we somewhere in now portfolio

asked give of to said Coast. X-X our and addition Farley to some of what campuses the data that other call that in building. of attractive creative here, August, I’ll relates companies, you better call, had West as spent to entire them of we’ve call fish to where truly point. big feet building. as of Realistically, just team what realistically that tenants square tackling. the to types what XXX,XXX grander are the on early understand just footprints, visiting I’ve tenants. of of of deliver normal the the and In feet. today that better extraordinarily we can customers, and of the question nature as hunting XXX,XXX Vikram to part prior is about, these extraordinarily is kind have the some days, part nature locking And Valley. full XXX,XXX the and I’ll Silicon to you these The in It this And on one the of well in blocked this begin The we And understand as unique the senior floor. went witness

a see a Frank building, is one footprints. building, Gehry You base go story and parking to square Facebook, the XXX,XXX of you’ll new which at

top. the about park think you As that, with on that’s XX acres,

park it’s square And tenants. floor when again, Apple’s other first the over feet, you You middle go and headquarters, ring. with of in and the there’s Samsung, effectively go to the over see to you Nvidea XXX,XXX

views So, unique earlier, around. is building a deliver space is New the the about horizontal Farley in of in I what what roof campus, we think heart is deck truly with great the the all truly York on City, to said ability

of the we going it’s really So, are normal after of less what what square fee our most XXX,XXX terms does what do but in day, tenant day, is. our that every business, tenants every than Glen feet,

Steven Roth

Steve it the submarkets expect, supply submarket-to-submarket. submarkets. you And it's that our supposed different Demand to is other there of actually, are on as always as is. tighter as focused are we would some

Steve Sakwa

is And over the guess, period. then Steve as I a billion that I multiyear know $X about talked you

capital buybacks, capital. sort geared use how of would of sort or do think bit how geared maybe about it uses today? for of So, little I sort capital? the use a share a acquisitions? Is premature is it about as to mean, for But, prioritize in think of redevelopment, you you those

Steven Roth

Yes, agree with is I you. It premature.

Steve Sakwa

And XQ. question. guess, it’s on H And then I realize just last whole early I the Amazon

Just led if out. that of the they about requirements you sort think

priority of New housing of kind other I as you some of York issue. how up cities? New stack about, the meet talked those think and stacks you any mean, do York affordability but many relative of do kind of of is you the maybe to to them that sort up? housing sense how And

Steven Roth

is like and hasn't it I fighting, think, is, don’t it we’ve I cities. We’ve think, difference brother anything and this before. to that like the applicants. all Amazon truly process ever marked brother XXX some seen there, got different out down that gets big. There’s these more a

there Steve, Amazon. we said to area. begin friendly is out, unparallel, terms in it's don’t about option, So it business the who’s the really is think quality the but I options amazing, cost high that predict very they’re even comes X I are is, York how but could result, to business of we only is are our can’t we we even But, predict begin comment We is XX a obviously, friendly. think other final that, there the Having can’t where New know. to or transportation like won’t of even that, we not think workforce and think is that be. we going know satisfy

Operator

And Alexander your Please from with comes next question ahead. Sandler Goldfarb go O’Neill.

Alexander Goldfarb

Good morning. vigor. have on back And Steve so certainly to good call, the and

Steven Roth

Thank you.

Alexander Goldfarb

sales would the as as dollars, guys poised other far does and revolution get may look stock Two into billion the I much your potential assets positions you different questions, you tax that how play are whatever at sell. both in Toys the and happens whatever happens both discussions? it here their division are of to of versus with much two Toys How with billion Asia $X separate is tied are

Steven Roth

coming tax I $XXX of million $X answer is And much from the question your think does write-off the potential okay. Toys, is billion shield how Joe.

Joseph Macnow

comes The $X the will other than from billion from Toys without of Toys. the it Toys write-off is utilization any of retain it’s all none and portion assets

Steven Roth

a that used all being icing billion haven't our So to cake terms that in of the Toys in internal on we budget. the at as is shield $X well used answer retain that

Alexander Goldfarb

about else? dispositions does a as so went to resolved mean that is that, something then you use you we an hopefully or think Toys follow-up additional should if shield for that would So amount of

Steven Roth

predict Once we can’t predict okay, just mean sell. I I I that again that can’t

Alexander Goldfarb

stick with… we’ll Okay,

Steven Roth

can we have Hang not we created we to got of to on, of assets are from time that think in lots our the the that for they core. time maturity where we different sell either reasons, we level value

longer longer are based other instance them we reasons, no really in For made want they where mistake, or a do once get reasons. longer a to where because upon take it we or we to no in even upon don’t think business they do or a growing real while rare large we into don't sales we miscellaneous based and estate a reasons tax profit try no we useful want why either

forward of a will last have We've this - tail remember the transactions it is on cake So shield not of savings millions in is - business. its of okay. tax really million which door hundreds a the be years $XX wedding Toys of very basis this this shield really a doesn't tax will we gain $XXX dollars million be say capital that the Toys going million or and $XX can just the shield a potential icing on in big done so recent of you

Alexander Goldfarb

have Joe then all obviously year it the a there all does about - think impacts in How million should that next equivalent quarter. NOI quarter over When think question, half. And over reactions XX GAAP online have a into come you this guys into to about that that’s the going within you leak releases on next XXXX? that out heading some a does year, come past of stock to of year second we next guys the year and put of assessed we lot good

Joseph Macnow

of the It’s interests. timing NOI the

Alexander Goldfarb

The GAAP NOI.

Steven Roth

Joe on, in is Hang looking some papers. through

Joseph Macnow

this on quarter in the is The gave given $XX equivalent Page QX NOI million million year, $XX XXXX EBITDA after. on by million year, $XX of in We the our Page million $XX million again fourth $X.X quarter year up comes next The this million year, of quarter $X X supplement. in supplement. of in X XXXX, the

Alexander Goldfarb

FFO. thinking that's GAAP as Joe or I cash about And

Joseph Macnow

The set set you was numbers gave second first NOI of I of GAAP, was the numbers gave I cash.

set $XX first The cash. $XX million is GAAP, the $XX of million. the numbers $XX of totaled numbers is totaled the set second million,

Operator

ahead. question next Reagan Green Street our from Please go Advisors. Jed And from comes

Jed Reagan

all hear a to very of better. Steve you're first glad feeling lot

Steven Roth

you. Thank

Jed Reagan

I at changed in mind you your with involvement that’s at it timeline maybe Board if approach or guess at talk those forward the evolving has succession thinking your can level? and terms day-to-day along on company all the if terms your the in all planning all going of lines of about

Steven Roth

management the I over future we team the in said number transformed this I. company and the is back involved Obviously at am of it’s then last of mind very level, - of in half of future Board plan top I’m be this the I years the that that, team said my as had mind obviously the totally Board on Having the back Having nine may mean even business. management nine. I the back and

which That's and we I a then we yet that, plan and say still and think Board do the Having to We I’m have the do. don't that with has be more have not we that you I person restructured I robust so, quite said do succession think was it something to that. I can anything more thought done corporate's. still assured have think enormously to to have the done and benefited we that best more have

Jed Reagan

position yield provided the to project for project? expectation that in wondering the if guys in provide a Simply you some stabilized helpful just cost Farley supplemental, a you’re on details

Steven Roth

estate are aspirations think aspirations the of it's acceptable that yields town in our we really also very that We in a real our side piece so Not are jumbler down high. best a return. very high think

which to ready let’s do real really do it's market use it our think We just so not will better make do anybody We’re and thing. us the let’s predictions estate we our thing. than

Jed Reagan

timeline, One Penn kind appreciate can point? color of you the two any last for this one at the the Penn timeline maybe offer expectation And redevelopment on

Steven Roth

be that right two and right to now two any us can’t - answer simple is information for inappropriate Penn give redevelopment we complex Penn to The lives so now. will or on it’s the

Operator

question go Nick ahead. UBS. And from Please our from Yulico next comes

Nick Yulico

how Just may that a what your question evolve? there and about latest plan Fifth, XXX thoughts

Steven Roth

first evolving an the that’s step. That's plan,

issue. The very, many attractive second said times very have its before estate, piece an a is overleveraged this is of it’s real I which

bottom over the position Our think office asset okay. on is proportionate look retail the leveraged at position leverage we our on leverage in Fifth upon of office it okay, the XXX% We of has that is building brilliant own XX% Avenue we well but to building we retail located. own the building. the The

marketplace in have a the development of they there XX% to revert the if office an position so likely There all the likely it’s So of schemes. it any that not the and in in where as look event. fairly mezz building will feasible rumors our building building. tearing for position rumors in in we marketplace loan are manner it's published we warrant upon capital more it relatively about amount than a and have have grand that our been It’s down that those been doing buildings modest

on on working it’s we're in so so et work a plans, process. arrangements we’re venture that working cetera working And we're capital on

Nick Yulico

so stake? in off where would to like is to than look sell existence that your the you your And ownership increase a situation rather building

Steven Roth

This year last don't seller grand likely want longer has than even maybe said I into were deal. that's are or position a the that. are our the increasing that gone it leave speculate or - on and or I building a subject adventure the our the so of current and we with of whether and grand in discussions seller that to we scheme scheme away buyer

Operator

Thank you participation you. conference. may you this today's Thank Ladies now and for concludes and disconnect. gentlemen

Steven Roth

which to - my Thanks everybody. fine, respect much very I am appreciate And health I thanks. wishes with well is your

Operator

Thank you ladies and gentlemen.

Vornado Realty Trust (VNO) 31 Oct 172017 Q3 Earnings call transcript