SL Green Realty SLG recently announced that it has entered into a joint venture (JV) with Mori Building Co., Ltd., Japan’s leading urban landscape developer, for the development of 346 Madison Avenue. With 51% interest, at a gross valuation of $175 million, SLG will play the role of developer and lease manager in the above arrangement. The two parties to the JV will collectively contribute their expertise and design capabilities.
Located one block from Grand Central Terminal and across from One Vanderbilt, 346 Madison Avenue is equipped with amenities like a 215-seat auditorium, a lushly landscaped terrace, a tenant lounge, a luxury wellness center and a world-class restaurant. KPF will helm the design of the new 46-floor tower stretching around 850,000 rentable square feet.
The joint venture is strategically significant for SL Green. By selling a minority stake while retaining operational control, the company can reduce its equity exposure to the Madison Avenue development, improve balance sheet flexibility and potentially redeploy proceeds into other value-accretive opportunities. The deal also strengthens the project’s profile through Mori Building’s design and development capabilities.
Given the continued tenant preference for modern, well-located and amenity-rich office properties, the JV is likely to enhance the appeal of 346 Madison Avenue and support SL Green’s long-term East Midtown growth strategy.
Over the past three months, shares of this Zacks Rank #3 (Hold) office REIT have rallied 20.2% compared with the industry’s gain of 2.4%.
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Stocks to Consider
Some better-ranked stocks from the broader REIT sector are W.P. Carey WPC and Prologis Inc. PLD, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for WPC’s 2026 FFO per share is pegged at $5.26. This implies year-over-year growth of 5.8%.
The consensus estimate for PLD’s 2026 FFO per share is pinned at $6.18. This calls for a year-over-year increase of 6.4%.
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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Prologis, Inc. (PLD): Free Stock Analysis Report
SL Green Realty Corporation (SLG): Free Stock Analysis Report
W.P. Carey Inc. (WPC): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).