SL Green Realty Corp. SLG delivered first-quarter 2026 funds from operations (FFO) per share of 84 cents, down 40% from $1.40 in the year-ago quarter. The figure missed the Zacks Consensus Estimate of $1.06, translating into a negative surprise of 20.8%.
Net rental revenues came in at $166 million, up 14.9% year over year and ahead of the Zacks Consensus Estimate of $163 million. The revenue beat, a 1.8% surprise, arrived alongside record first-quarter leasing volume across SLG’s Manhattan office portfolio.
While leasing activity strengthened, SL Green’s first-quarter 2026 FFO per share performance was weighed down by items embedded in FFO and a tougher year-ago comparison. The latest reported quarter included 6 cents per share of unamortized deferred financing costs and 3 cents per share of positive non-cash fair value adjustments on mark-to-market derivatives. The year-ago quarter included 33 cents per share of income tied to the resolution of a commercial mortgage investment. Nevertheless, the office REIT reaffirmed its 2026 guidance.
Following the earnings release and the FFO miss, SLG shares were down more than 2% in after-hours trading.
SLG’s Leasing Momentum Highlights Pricing and Demand
Leasing was the operating bright spot in the first quarter of 2026. SLG signed 51 Manhattan office leases totaling 929,264 square feet, marking the highest first-quarter volume in the company’s 28-year history. The average rent on Manhattan office leases signed during the quarter was $105.12 per rentable square foot, with an average lease term of 9.8 years.
Replacement leasing also showed improved pricing. On space that had been occupied within the prior 12 months, SLG reported a 16.1% mark-to-market increase versus the previous fully escalated rents. Tenant concessions averaged 10.9 months of free rent with a tenant improvement allowance of $107.76 per rentable square foot, underscoring the mix of higher starting rents and meaningful upfront packages.
Occupancy trends moved in the right direction, too. Manhattan same-store office occupancy increased to 94.4% as of March 31, 2026, inclusive of leases signed but not yet commenced, up from 93% at the end of the prior quarter. Management expects this metric to reach 95% by Dec. 31, 2026. Significant leases during the quarter included new commitments from Clay Labs at 11 Madison Avenue and a large global investment firm at 245 Park Avenue, along with expansions from tenants such as Harvey AI Corporation and TD Securities.
Operationally, the company reported that Manhattan same-store cash net operating income (NOI), including its share from unconsolidated joint ventures, increased 2.6% year over year in the first quarter of 2026, excluding lease termination income. For investors, the metric helps connect strong leasing execution to property-level cash performance, even as corporate-level costs and other items influence bottom-line measures.
On the portfolio side, SLG entered into a contract to sell the residential and retail components of 7 Dey Street for a total consideration of $222.6 million, with closing expected in the second quarter of 2026, subject to customary conditions. The company also closed on the sale of 690 Madison Avenue for $54.5 million, generating cash proceeds to SL Green of $48.5 million.
SLG’s Capital Actions and 2026 Outlook Stay in Focus
SLG’s balance sheet positioning and capital markets activity were prominent in the quarter. Cash and cash equivalents totaled $143.9 million as of March 31, 2026 compared with $155.7 million at the end of 2025. Total debt, net of deferred financing costs, stood at $4.45 billion as of Dec. 31, 2025 compared with $3.93 billion at year-end.
The company also highlighted multiple transactions aimed at reshaping funding and liquidity. Alongside its joint venture partners, SLG completed a $1.65 billion, five-year, fixed-rate refinancing of One Madison Avenue at an interest rate of 5.81%. It also refinanced, extended and reduced the overall cost of $2.0 billion of its $2.4 billion corporate credit facility, extending the $1.25 billion revolving line of credit to June 2031 and restructuring the term loan into a new $750 million facility with a June 2031 maturity, while reducing borrowing costs on both components by 25 basis points.
SL Green reaffirmed its previously announced 2026 FFO guidance range of $4.40-$4.70 per share, with a midpoint of $4.55 per share. The Zacks Consensus Estimate for the same is currently pegged at $4.64.
The company also noted that its board established an annual ordinary dividend on common stock for 2026 of $2.47 per share, a level intended to support incremental liquidity for potential investment opportunities.
SLG’s Zacks Rank and Recommendation
SL Green currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
SL Green Realty Corporation Price, Consensus and EPS Surprise
SL Green Realty Corporation price-consensus-eps-surprise-chart | SL Green Realty Corporation Quote
Upcoming Earnings Releases
We now look forward to the earnings releases of other REITs like BXP Inc. BXP and Cousins Properties CUZ, slated to report on April 28 and 29, respectively.
The Zacks Consensus Estimate for BXP Inc.’s first-quarter 2026 FFO per share stands at $1.58, which indicates a 3.7% dip year over year. BXP currently has a Zacks Rank #3.
The Zacks Consensus Estimate for Cousins Properties’ first-quarter 2026 FFO per share is pegged at 71 cents, which implies a 4.05% year-over-year decrease. CUZ currently carries a Zacks Rank #2 (Buy).
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO), a widely used metric to gauge the performance of REITs.
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