SL Green Realty Corp. SLG reported second-quarter 2026 funds from operations (FFO) per share of $1.43, which beat the Zacks Consensus Estimate of $1.19 by 20.17%. However, FFO declined 12.3% from $1.63 in the year-ago quarter.
Net rental revenues of $171.85 million surpassed the consensus estimate of $171.48 million by 0.22% and increased 16.5% year over year. The results reflected stronger Manhattan leasing, higher occupancy and growth in same-store cash net operating income (NOI).
SLG's Leasing Momentum Strengthens
During the second quarter, SL Green signed 53 Manhattan office leases covering 445,161 square feet. The average rent was $93.17 per rentable square foot, while the average lease term was 5.8 years.
Replacement leases covering 308,680 square feet had average starting rents of $98.42 per rentable square foot. This represented an 18% increase over the previous fully escalated rents for the same office spaces, indicating healthy pricing for recently occupied space.
On July 22, 2026, SL Green announced that an AI tenant had entered into a new 10-year lease totaling 98,420 square feet for the entire 11th floor at 11 Madison Avenue. With this lease, the company has executed office leases covering 1,478,673 square feet to date in 2026 and maintains a current pipeline of more than 900,000 square feet.
SLG's Occupancy and NOI Improve
Manhattan same-store office occupancy, including leases signed but not yet commenced, rose to 94.7% as of June 30, 2026. This compares with 94.4% at the end of the prior quarter and 93% at the end of 2025. Management expects occupancy on the same basis to reach 95% by year-end 2026.
Manhattan same-store cash NOI, including the company’s share from unconsolidated joint ventures and excluding lease termination income, increased 4.3% from the prior-year quarter.
SLG's Portfolio Activity Remains Active
The company closed the sale of the residential and retail components of 7 Dey Street for $222.6 million, generating net cash proceeds of $23.7 million. It retained ownership of the 21,000-square-foot office condominium.
SL Green also sold a 49% joint venture interest in the 346 Madison Avenue development at a gross valuation of $175 million and received $94.9 million in net proceeds. Separately, it agreed to sell 10 East 53rd Street for $312.2 million, with expected net proceeds of about $100 million earmarked for corporate debt repayment.
SLG’s Debt Fund, Liquidity & Buyback Add Support
The company deployed $94.7 million from its $1.3 billion SLG Opportunistic Debt Fund during the second quarter. Since the beginning of the year through July 22, 2026, deployment reached $306.4 million, bringing the cumulative deployment to $590.5 million, of which $517.5 million had been funded.
SLG ended June 2026 with cash and cash equivalents of $180.8 million, up from $143.9 million at the end of March 2026. Consolidated debt declined to $4.55 billion from $4.77 billion sequentially.
SLG repurchased $14.1 million of common stock at an average price of $49.67 per share.
SLG Raises 2026 Guidance
Management increased its 2026 FFO guidance to $5.60-$5.90 per share from $4.40-$4.70. The midpoint rose $1.20, including 40 cents per share from higher NOI generated by the company's real estate portfolio, incremental fees and other income, and 80 cents per share of additional income expected from One Vanderbilt Avenue. The Zacks Consensus Estimate for 2026 FFO per share is currently pegged at $4.58.
SLG’s Zacks Rank & 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 Extra Space Storage EXR and Cousins Properties CUZ, slated to report on July 28 and 30, respectively.
The Zacks Consensus Estimate for EXR’s second-quarter 2026 FFO per share is pegged at $2.06, which implies a 0.49% year-over-year decrease. EXR currently carries a Zacks Rank #3.
The Zacks Consensus Estimate for CUZ’s second-quarter 2026 FFO per share is pinned at 74 cents, which indicates a 5.7% rise year over year. CUZ currently carries a Zacks Rank #3.
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.
7 Best Stocks for the Next 30 Days
Just released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."
Since 1988, the full list has beaten the market more than 2X over with an average gain of +23.9% per year. So be sure to give these hand picked 7 your immediate attention.
See them now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
SL Green Realty Corporation (SLG): Free Stock Analysis Report
Cousins Properties Incorporated (CUZ): Free Stock Analysis Report
Extra Space Storage Inc (EXR): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).