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Core Insights - Empire State Realty Trust is focused on maximizing occupancy and lease economics in its Manhattan office portfolio, which has over 500,000 square feet of availability, with a strong balance sheet that allows for strategic opportunities [1][2][3] Financial Performance - The company reported FFO above consensus for the third quarter and reaffirmed its 2025 guidance, with a highly leased portfolio benefiting from strong lease-up activity [3][12] - Core FFO was reported at $0.23 per diluted share, with same-store property cash NOI increasing by 1.1% year-over-year [11] Leasing Activity - In the third quarter, Empire State Realty Trust signed 88,000 square feet of new and renewal leases, with an additional 50,000 square feet signed post-quarter-end and 150,000 square feet in negotiation [6][9] - Manhattan office occupancy increased by 80 basis points to 90.3%, with expectations to achieve year-end commercial occupancy guidance of 89% to 91% [8][10] Market Position - The New York City office leasing market remains strong, with low availability in top-tier buildings and rising rents, while older buildings are being converted to residential use [2][10] - Empire State Realty Trust's portfolio is over 93% leased, marking the eleventh consecutive quarter above 90% occupancy [9][10] Observatory Performance - The Observatory generated approximately $26.5 million of NOI in the third quarter, with revenue per capita increasing by 2.7% year-over-year [12][13] Capital Allocation and Strategy - The company maintains a flexible balance sheet with a net debt to EBITDA ratio of 5.6 times, and recently issued $175 million in senior unsecured notes to fund general corporate purposes [14][15] - Empire State Realty Trust is actively pursuing new investment opportunities across office, retail, and multifamily sectors in New York City [15][16] Leadership Transition - A leadership transition is underway, with Thomas Durels stepping down after over 35 years, and Ryan Cass and Jackie Renton taking over as co-heads of real estate [5][6] Sustainability and Operational Excellence - The company achieved a five-star rating for environmental stewardship for the sixth consecutive year, emphasizing its commitment to sustainability and operational excellence [4][12]

Financial Data and Key Metrics Changes - The company reported core FFO of $0.23 per diluted share for Q3 2025, with same-store property cash NOI excluding lease termination fees increasing by 1.1% year over year [16] - Adjusted for nonrecurring items, same-store cash revenue and operating expenses increased by 1.3% and 1.5% respectively year over year [16] - The company expects strong fourth-quarter cash NOI growth due to a real estate tax abatement anticipated by year-end [16] Business Line Data and Key Metrics Changes - In Q3, the company signed 88,000 square feet of new and renewal leases, with an additional 50,000 square feet signed post-quarter and 150,000 square feet in negotiation [11][12] - The Manhattan office occupancy increased by 80 basis points sequentially to 90.3%, with a target year-end commercial occupancy guidance of 89% to 91% [12] - The multifamily platform portfolio achieved 99% occupancy and 9% year-over-year net rent growth [14] Market Data and Key Metrics Changes - The office leasing market in New York City is reported to be the strongest since 2019, with demand concentrated among top-quality, amenitized buildings [13] - The company has seen over 3.1 million square feet of expansions from existing tenants since its IPO in 2013, indicating strong tenant demand [38] Company Strategy and Development Direction - The company focuses on maintaining a strong and flexible balance sheet, pursuing disciplined growth, and advancing sustainability leadership [68] - The company is actively underwriting new investment opportunities across office, retail, and multifamily sectors in New York City [20] - The company aims to capitalize on the strength of the Manhattan office market and has achieved over 600 basis points of positive lease absorption across its Manhattan office portfolio [20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the future of New York City, emphasizing its status as a magnet for job-seeking graduates and employers [32] - The company anticipates continued rent increases due to limited available space and a strong demand environment [51] Other Important Information - The company achieved the highest possible GRESB 5 Star rating for the sixth consecutive year, highlighting its commitment to sustainability [8] - The company announced the issuance of $175 million of senior unsecured notes to fund general corporate purposes, including potential new investments and debt repayment [19] Q&A Session Summary Question: Can you expand on capital uses after the private placement? - The company is actively underwriting deals across office, retail, and multifamily sectors in New York City and is positioned with good liquidity to act quickly on opportunities [27] Question: Are there concerns about tenants exposed to potential rent changes? - Management remains positive about New York City and operates on a policy basis, focusing on contributing to policy regardless of the administration [31] Question: How attractive is buying back stock at current share prices? - The company views its share price as attractive and considers share buybacks as part of its strategic capital allocation [33] Question: Any updates on the Metro Center disposition? - The company is flexible regarding the Metro Center asset and is open to capital recycling opportunities to redeploy proceeds into higher-value assets [40] Question: Are there trends in tenant activity and industry demand? - The company sees strong interest from various sectors, with tenants looking to upgrade to better quality spaces and expand their offerings [46]

EMPIRE STATE REALTY TRUST Investor Presentation October 2025 North Sixth Street Collec Multi-Purpose Space at ESB Williamsburg, Brooklyn Rooftop and Penthouse Lounge at 501 Seventh Ave Sol de Janeiro at One Grand Central Place 33rd Street Empire Lounge at ESB CLA at One Grand Central Place Empire State Empire State Building EMPIRE STATE REALTY TRUST 3 | 28 ESRT OVERVIEW Why ESRT? Pure Play NYC REIT High-Quality Office: Modernized, Amenitized, Energy Efficient, Near Mass Transit Competitive Advantages Conten ...

Financial Performance - The company reported a significant increase in Funds From Operations (FFO), reaching $150 million, representing a 10% increase year-over-year[7]. - Net Operating Income (NOI) for the same store properties increased by 5% to $200 million, indicating strong performance in the existing portfolio[11]. - The company anticipates a 15% growth in revenue for the next fiscal year, driven by new product launches and market expansion strategies[3]. - Total revenues for Q3 2025 were $197.73 million, an increase from $191.25 million in Q2 2025, representing a growth of 3.9%[26]. - Rental revenue for Q3 2025 was $158.41 million, up from $153.54 million in Q2 2025, reflecting a 3.8% increase[26]. - Net income attributable to common stockholders for Q3 2025 was $7.99 million, compared to $6.52 million in Q2 2025, marking a 22.5% increase[26]. - The company reported total operating income of $39.33 million for Q3 2025, up from $35.12 million in Q2 2025, reflecting an increase of 6.3%[26]. - Net income for Q3 2025 was $13,645,000, up from $11,385,000 in Q2 2025, indicating a growth of 19.8%[28]. - Core FFO attributable to common stockholders for Q3 2025 was $61,293,000, compared to $59,213,000 in Q2 2025, reflecting an increase of 3.5%[28]. - Basic FFO per share for Q3 2025 was $0.22, consistent with Q2 2025, while diluted FFO per share also remained at $0.22[28]. Operational Efficiency - The company is investing $50 million in technology upgrades to enhance operational efficiency and tenant experience[10]. - The occupancy rate across the portfolio improved to 95%, up from 92% in the previous quarter, indicating effective management of tenant relationships[18]. - The company continues to focus on energy efficiency and indoor environmental quality as part of its operational strategy[16]. - Same Store Property Cash Net Operating Income (NOI) for the total portfolio is $68,130,000, reflecting an increase from $67,280,000 in the previous quarter[31]. - Multifamily Cash NOI increased to $5,284,000 from $5,173,000 in the prior quarter, with a high occupancy rate of 98.6%[31]. Debt Management - The company plans to reduce debt by $100 million over the next year, aiming for a lower leverage ratio[21]. - Total liabilities stood at $2.31 billion as of September 30, 2025, compared to $2.29 billion as of June 30, 2025, indicating a marginal increase[22]. - The company has a debt to Adjusted EBITDA ratio of 6.0x, indicating a stable leverage position[31]. - Total fixed rate debt amounts to $2,071,554, with a weighted average interest rate of 4.34%[85]. - The company plans to issue $175 million of senior unsecured notes at a fixed rate of 5.47%, maturing in 2031[86]. Strategic Initiatives - A strategic acquisition of a new property valued at $300 million is expected to close in Q1 2025, which will diversify the portfolio[5]. - The company is focusing on sustainability initiatives, with a goal to achieve a 30% reduction in carbon emissions by 2026[4]. - Future guidance includes an expected increase in dividends by 5% based on projected cash flow improvements[10]. Leasing Activity - The leasing activity showed a 20% increase in new leases signed compared to the previous quarter, reflecting a robust demand for commercial space[12]. - Total leases executed in Q3 2025 was 16, down from 31 in Q3 2024, indicating a decline of 48.4% year-over-year[44]. - Average starting cash rent per square foot for leases executed in Q3 2025 was $80.61, a decrease of 1.2% compared to $75.74 in Q3 2024[44]. - The total number of leases across the portfolio is 558, with an average annualized rent per occupied square foot of $72.68[49]. Visitor and Revenue Metrics - The Empire State Building was ranked the 1 Top Attraction in New York City for the fourth consecutive year in Tripadvisor's 2025 Travelers' Choice Awards[16]. - The observatory revenue for the twelve months to date is $131,372,000, with a net operating income (NOI) of $94,192,000[79]. - The number of visitors to the observatory decreased by 10.9% year over year, totaling 648,000 visitors[79]. Capital Expenditures - Capital expenditures for tenant improvements and leasing commissions totaled $40,312,000 for the three months ended September 30, 2025[76]. - The company anticipates cash rent from leases commencing in 2026 to contribute $23,156,000 to cash NOI[77].

Core Points - Empire State Realty Trust, Inc. (ESRT) has signed a lease with SORA for a 14,430 square foot high-end restaurant at One Grand Central Place, enhancing its retail portfolio [1][3] - SORA is a Japanese omakase-style restaurant featuring five high-end dining concepts curated by top chefs from Japan and a cocktail experience directly from Tokyo [2][3] - The addition of SORA aligns with ESRT's strategy to meet the expectations of top-tier tenants and enhance the culinary offerings in the Grand Central District [3] Company Overview - Empire State Realty Trust, Inc. is a New York City-focused REIT that owns and operates a portfolio of modernized office, retail, and multifamily assets, including the iconic Empire State Building [5] - As of June 30, 2025, ESRT's portfolio includes approximately 7.8 million rentable square feet of office space, 0.8 million rentable square feet of retail space, and 743 residential units [5]

Core Points - Empire State Realty Trust, Inc. (NYSE: ESRT) achieved a 5 Star Rating from the Global Real Estate Sustainability Benchmark (GRESB) for the sixth consecutive year with a score of 93 and an A in public disclosure [1] - The company attained the highest management score among all 575 ranked companies in the Americas and the second highest overall score for all listed companies in the Americas [1] Company Performance - The GRESB rating reflects the company's commitment to sustainability and effective management practices in real estate [1] - The score of 93 indicates a strong performance in sustainability metrics compared to peers [1]

Core Viewpoint - Empire State Realty Trust, Inc. will release its third quarter 2025 financial results on October 29, 2025, after market close [1] - A conference call is scheduled for October 30, 2025, at 12:00 p.m. Eastern Time to discuss performance and recent events [1] Financial Results Announcement - The financial results for the third quarter of 2025 will be disclosed after the close of markets on the New York Stock Exchange [1] - The conference call will include a review of the third quarter performance and a question-and-answer session [1]

Group 1 - Paramount Group's stock price rose by 3.7% after reports of multiple bidders in the second round of sales [1] - Bidders include Vornado Realty (VNO.US), SL Green Realty (SLG.US), Empire State Realty Trust (ESRT.US), Blackstone (BX.US), DivcoWest, and Rithm Capital (RITM.US) [1] - Paramount Group initiated a strategic review in May to maximize shareholder value [1] Group 2 - Paramount Group is a real estate investment trust focused on owning, operating, managing, acquiring, and redeveloping high-quality Class A office properties in central business districts of New York City and San Francisco [1] - The company's stock has increased by 40% year-to-date [1]

[FORM 10-Q Filing Information](index=1&type=section&id=FORM%2010-Q) [Registrant Information](index=1&type=section&id=Registrant%20Information) Details the registrant, filing type, period, and commission file number for Empire State Realty Trust, Inc - Registrant: **EMPIRE STATE REALTY TRUST, INC.**[2](index=2&type=chunk) - Filing Type: **Quarterly Report (Form 10-Q)**[2](index=2&type=chunk) - Period Ended: **June 30, 2025**[2](index=2&type=chunk) - Commission File Number: **001-36105**[2](index=2&type=chunk) [Securities Registered](index=1&type=section&id=Securities%20Information) The company's Class A Common Stock is registered on the New York Stock Exchange, while Class B Common Stock is not publicly traded Table: Registered Securities | Title of each class | Trading Symbol | Name of each exchange on which registered | | :------------------ | :------------- | :---------------------------------------- | | Class A Common Stock, par value $0.01 per share | ESRT | The New York Stock Exchange | | Class B Common Stock, par value $0.01 per share | N/A | N/A | [Filer Status and Outstanding Shares](index=1&type=section&id=Filer%20Status%20and%20Outstanding%20Shares) ESRT is classified as a large accelerated filer and is not a shell company. As of August 4, 2025, the company had 168.6 million Class A Common Stock shares and 0.97 million Class B Common Stock shares outstanding - Filer Status: **Large accelerated filer**[4](index=4&type=chunk) - Shell Company: **No**[4](index=4&type=chunk) - Outstanding Class A Common Stock (as of August 4, 2025): **168.6 million shares**[4](index=4&type=chunk) - Outstanding Class B Common Stock (as of August 4, 2025): **0.97 million shares**[4](index=4&type=chunk) [PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%201.%20FINANCIAL%20INFORMATION) [ITEM 1. FINANCIAL STATEMENTS](index=3&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS) Presents unaudited condensed consolidated financial statements, including balance sheets, income statements, cash flows, and detailed notes for the period ended June 30, 2025 [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The balance sheet shows a decrease in total assets primarily driven by a significant reduction in cash and cash equivalents and the derecognition of a contract asset, while total liabilities also decreased, leading to a slight increase in total equity Table: Condensed Consolidated Balance Sheet Highlights (amounts in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :---------------------------- | :------------ | :---------------- | | Total assets | $4,078,750 | $4,510,287 | | Cash and cash equivalents | $94,643 | $385,465 | | Contract asset | — | $170,419 | | Total liabilities | $2,289,502 | $2,728,325 | | Total equity | $1,789,248 | $1,781,962 | - Total assets decreased by **$431.5 million** from December 31, 2024, to June 30, 2025[10](index=10&type=chunk) - Cash and cash equivalents decreased by **$290.8 million**[10](index=10&type=chunk) - Total liabilities decreased by **$438.8 million**[10](index=10&type=chunk) [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For both the three and six months ended June 30, 2025, total revenues remained relatively stable year-over-year, but operating income and net income decreased, leading to a lower basic and diluted earnings per share Table: Condensed Consolidated Statements of Operations (amounts in thousands, except per share) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :---------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total revenues | $191,250 | $189,543 | $371,316 | $370,722 | | Total operating income | $35,122 | $39,361 | $60,910 | $70,424 | | Net income | $11,385 | $28,555 | $27,163 | $38,770 | | Net income attributable to common stockholders | $6,519 | $17,071 | $15,739 | $22,732 | | Basic EPS | $0.04 | $0.10 | $0.09 | $0.14 | | Diluted EPS | $0.04 | $0.10 | $0.09 | $0.14 | | Dividends per share | $0.035 | $0.035 | $0.070 | $0.070 | - Net income attributable to common stockholders decreased by **61.8%** for the three months ended June 30, 2025, and by **30.8%** for the six months ended June 30, 2025, compared to the prior year periods[12](index=12&type=chunk) [Condensed Consolidated Statements of Comprehensive Income](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income) The company reported a shift from an unrealized gain to an unrealized loss on interest rate swap agreements, contributing to a decrease in comprehensive income for both the three and six months ended June 30, 2025, compared to the prior year Table: Condensed Consolidated Statements of Comprehensive Income (amounts in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :---------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income | $11,385 | $28,555 | $27,163 | $38,770 | | Unrealized gain (loss) on valuation of interest rate swap agreements | $(1,472) | $2,853 | $(5,588) | $11,051 | | Other comprehensive income (loss) | $(1,956) | $2,186 | $(7,121) | $8,060 | | Comprehensive income | $9,429 | $30,741 | $20,042 | $46,830 | | Comprehensive income attributable to common stockholders | $5,281 | $18,437 | $11,267 | $27,820 | [Condensed Consolidated Statements of Stockholders' Equity](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders'%20Equity) Total equity increased slightly from December 31, 2024, to June 30, 2025, primarily due to net income and equity compensation, partially offset by dividends and share repurchases Table: Condensed Consolidated Statements of Stockholders' Equity (amounts in thousands) | Metric | Balance at December 31, 2024 | Balance at June 30, 2025 | | :---------------------------- | :--------------------------- | :----------------------- | | Total Empire State Realty Trust, Inc. stockholders' equity | $1,030,696 | $1,038,209 | | Non-controlling interests in the Operating Partnership | $721,326 | $721,099 | | Total equity | $1,781,962 | $1,789,248 | - Net income attributable to common stockholders for the six months ended June 30, 2025, was **$15.7 million**[18](index=18&type=chunk) - Dividends and distributions totaled **$21.6 million** for the six months ended June 30, 2025[18](index=18&type=chunk) - Repurchases of common shares amounted to **$2.1 million** for the six months ended June 30, 2025[18](index=18&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Operating activities provided slightly more cash, while investing activities used significantly more cash due to property acquisitions. Financing activities shifted from providing cash to using a substantial amount, primarily due to debt repayments, resulting in a net decrease in cash and restricted cash Table: Condensed Consolidated Statements of Cash Flows (amounts in thousands) | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :---------------------------- | :----------------------------- | :----------------------------- | | Net cash provided by operating activities | $109,861 | $108,050 | | Net cash used in investing activities | $(155,570) | $(127,662) | | Net cash (used in) provided by financing activities | $(246,866) | $189,204 | | Net (decrease) increase in cash and cash equivalents and restricted cash | $(292,575) | $169,592 | | Cash and cash equivalents and restricted cash—end of period | $136,727 | $576,548 | - Investing activities included **$31.7 million** for the acquisition of real estate property in 2025[20](index=20&type=chunk) - Financing activities included repayment of **$100.0 million** in unsecured senior notes and **$120.0 million** in unsecured revolving credit facility in 2025[22](index=22&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=12&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Provides detailed explanations and disclosures for the financial statements, covering business, accounting policies, acquisitions, debt, equity, and segment performance [1. Description of Business and Organization](index=12&type=section&id=1.%20Description%20of%20Business%20and%20Organization) Empire State Realty Trust, Inc. (ESRT) is a NYC-focused REIT owning and operating a portfolio of office, retail, and multifamily assets, including the iconic Empire State Building. The company holds a controlling interest in its Operating Partnership, which conducts substantially all business - ESRT is a **NYC-focused REIT** with a portfolio of office, retail, and multifamily assets[25](index=25&type=chunk) - Portfolio as of June 30, 2025: approximately **7.8 million rentable square feet of office space**, **0.8 million rentable square feet of retail space**, and **743 residential units**[26](index=26&type=chunk) - ESRT owns approximately **60.8%** of the aggregate operating partnership units in its Operating Partnership[27](index=27&type=chunk) [2. Summary of Significant Accounting Policies](index=12&type=section&id=2.%20Summary%20of%20Significant%20Accounting%20Policies) The company's unaudited condensed consolidated financial statements are prepared in conformity with GAAP and SEC rules, with no material changes to significant accounting policies from the prior Annual Report. The Observatory and multifamily businesses experience some seasonality - No material changes to significant accounting policies from the Annual Report on Form 10-K for the year ended December 31, 2024[28](index=28&type=chunk) - Observatory business experiences seasonality, with **25% of annual revenue** realized in the second quarter of 2024[30](index=30&type=chunk) - Multifamily business experiences seasonality in winter months (November-January) due to slower lease activity[30](index=30&type=chunk) - The Operating Partnership is consolidated as a **Variable Interest Entity (VIE)** of ESRT[32](index=32&type=chunk) [3. Acquisitions and Dispositions](index=14&type=section&id=3.%20Acquisitions%20and%20Dispositions) In June 2025, ESRT acquired two retail properties for $31.0 million. The consensual foreclosure of First Stamford Place was completed in February 2025, leading to the derecognition of related debt and a $13.2 million gain - Acquired two retail properties on North 6th Street in Williamsburg, Brooklyn, for **$31.0 million** in June 2025[35](index=35&type=chunk) - Completed consensual foreclosure of First Stamford Place in February 2025, resulting in the derecognition of the senior mortgage obligation and a **$13.2 million gain** from the mezzanine debt obligation[38](index=38&type=chunk)[39](index=39&type=chunk) - In March 2024, ESRT bought out a **10% non-controlling interest** in two multifamily properties for **$14.2 million cash** and **$18.0 million debt assumption**[36](index=36&type=chunk) [4. Deferred Costs, Acquired Lease Intangibles and Goodwill](index=16&type=section&id=4.%20Deferred%20Costs,%20Acquired%20Lease%20Intangibles%20and%20Goodwill) Deferred costs, net, decreased slightly to $181.7 million as of June 30, 2025. Goodwill remained at $491.5 million, allocated between the Observatory and real estate segments, with no impairment identified in the latest annual testing Table: Deferred Costs, Lease Intangibles, and Goodwill (amounts in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :---------------------------- | :------------ | :---------------- | | Total deferred costs, net | $181,694 | $183,987 | | Acquired below-market ground leases, net | $309,495 | $313,410 | | Goodwill | $491,479 | $491,479 | - Goodwill is allocated **$227.5 million** to the Observatory segment and **$264.0 million** to the real estate segment[40](index=40&type=chunk) - Annual goodwill testing in October 2024 concluded that the fair value of the reporting unit exceeded its carrying value, indicating **no impairment**[41](index=41&type=chunk)[43](index=43&type=chunk) [5. Debt](index=18&type=section&id=5.%20Debt) Total principal debt decreased to $2.07 billion as of June 30, 2025, primarily due to the repayment of $100 million in Series A senior unsecured notes and $120 million from the unsecured revolving credit facility. The company remains in compliance with all debt covenants Table: Debt Summary (amounts in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :---------------------------- | :------------ | :---------------- | | Total principal | $2,072,478 | $2,294,274 | | Total debt (net of deferred financing costs and unamortized discount) | $2,057,678 | $2,277,968 | | Mortgage notes payable, net | $691,440 | $692,176 | | Senior unsecured notes, net | $1,097,355 | $1,197,061 | | Unsecured term loan facilities, net | $268,883 | $268,731 | | Unsecured revolving credit facility | — | $120,000 | - Repaid **$100.0 million Series A senior unsecured notes** on March 27, 2025[55](index=55&type=chunk) - Repaid **$120.0 million borrowings** on the Revolving Credit Facility on March 18, 2025, with **no outstanding balance** as of June 30, 2025[50](index=50&type=chunk) - The company was in **compliance with all debt covenants** as of June 30, 2025[45](index=45&type=chunk)[54](index=54&type=chunk)[56](index=56&type=chunk) [6. Accounts Payable and Accrued Expenses](index=21&type=section&id=6.%20Accounts%20Payable%20and%20Accrued%20Expenses) Total accounts payable and accrued expenses decreased to $104.3 million as of June 30, 2025, primarily due to a reduction in capital expenditures included in accounts payable Table: Accounts Payable and Accrued Expenses (amounts in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :---------------------------- | :------------ | :---------------- | | Total accounts payable and accrued expenses | $104,315 | $132,016 | | Capital expenditures included in accounts payable and accrued expenses | $51,560 | $73,535 | [7. Financial Instruments and Fair Values](index=21&type=section&id=7.%20Financial%20Instruments%20and%20Fair%20Values) ESRT uses derivatives to manage interest rate risk, with $448.0 million notional value, resulting in a net asset position and debt fair value below book value - Aggregate notional value of interest rate swaps and caps was **$448.0 million** as of June 30, 2025, down from **$664.0 million** as of December 31, 2024[61](index=61&type=chunk)[63](index=63&type=chunk) - Derivative instruments designated as cash flow hedges resulted in a **net unrealized loss of $2.0 million** for the three months and **$7.1 million** for the six months ended June 30, 2025, recognized in comprehensive income[62](index=62&type=chunk) - The fair value of outstanding debt was approximately **$2.0 billion**, which was **$98.3 million less than the book value** as of June 30, 2025[64](index=64&type=chunk)[214](index=214&type=chunk) [8. Leases](index=26&type=section&id=8.%20Leases) As a lessor, ESRT's rental revenue includes fixed and variable payments, with future contractual minimum lease payments totaling $3.75 billion. As a lessee, the company has operating lease agreements for three ground lease assets, with right-of-use assets and lease liabilities of $28.1 million Table: Rental Revenue from Leases (amounts in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :---------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Fixed payments (rental revenue) | $133,873 | $136,235 | $269,829 | $272,588 | | Variable payments (rental revenue) | $19,667 | $16,235 | $38,253 | $33,764 | | Total rental revenue | $153,540 | $152,470 | $308,082 | $306,352 | - Future contractual minimum lease payments on non-cancellable operating leases to be received total **$3.75 billion** as of June 30, 2025[73](index=73&type=chunk) - Future lease payments to be received for signed leases not yet commenced amount to approximately **$570.1 million**[74](index=74&type=chunk) - Right-of-use assets and ground lease liabilities were **$28.1 million** as of June 30, 2025, with a weighted average remaining lease term of **45.0 years**[75](index=75&type=chunk)[78](index=78&type=chunk) [9. Commitments and Contingencies](index=28&type=section&id=9.%20Commitments%20and%20Contingencies) ESRT is involved in ongoing legal proceedings, including an arbitration appeal related to the Empire State Building, and estimates $103.9 million in unfunded capital expenditures. The company also addresses environmental matters, including asbestos and Local Law 97 compliance, and maintains customary insurance coverage - An arbitration award of approximately **$1.3 million** (inclusive of interest) against the Respondents (including ESRT subsidiary) was affirmed by the appeals court on March 13, 2025, with a motion for leave to appeal to the New York Court of Appeals filed[82](index=82&type=chunk) - Estimated unfunded capital expenditures (tenant improvements and leasing commissions) are approximately **$103.9 million** as of June 30, 2025[85](index=85&type=chunk) - ESRT expects to pay **no Local Law 97 fine** on any covered building in its portfolio for the 2024-2029 enforcement period[93](index=93&type=chunk) [10. Equity](index=32&type=section&id=10.%20Equity) As of June 30, 2025, ESRT had 168.3 million Class A common shares and 109.3 million OP Units outstanding. The company repurchased 310,415 shares in April 2025 under its $500 million repurchase program. Total dividends and distributions to equity holders for the six months ended June 30, 2025, were $21.6 million - As of June 30, 2025, there were **168.3 million shares of Class A common stock** and **109.3 million OP Units** outstanding[99](index=99&type=chunk) - Repurchased **310,415 shares of Class A common stock** in April 2025 at an average price of **$6.92 per share**, under a **$500.0 million repurchase program** authorized through December 31, 2025[102](index=102&type=chunk) Table: Dividends and Distributions (amounts in thousands) | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :---------------------------- | :----------------------------- | :----------------------------- | | Dividends paid to common stockholders | $(11,799) | $(11,552) | | Distributions paid to Operating Partnership unitholders | $(7,689) | $(7,546) | | Distributions paid to preferred unitholders | $(2,101) | $(2,101) | | Total Dividends and Distributions | $(21,589) | $(21,199) | - Unrecognized compensation expense for LTIP unit awards was **$42.1 million** at June 30, 2025, to be recognized over a weighted average period of **2.8 years**[118](index=118&type=chunk) [11. Related Party Transactions](index=39&type=section&id=11.%20Related%20Party%20Transactions) ESRT engages in various related party transactions, including supervisory fees, property management fees, and rent from entities affiliated with its Chairman and CEO, Anthony E. Malkin. Additionally, a director's sister is the CEO of a tenant at one of ESRT's properties Table: Related Party Revenue (amounts in thousands) | Revenue Type | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :---------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Supervisory Fee Revenue | $0.3 | $0.2 | $0.7 | $0.4 | | Property Management Fee Revenue | $0.1 | $0.1 | $0.1 | $0.2 | | Other Revenue (rent, computer support) | $0.1 | $0.1 | $0.2 | $0.2 | - A director's sister is the Founder and CEO of Sol de Janeiro USA, a tenant at One Grand Central Place, with a lease commencing April 2025 at an annualized rent of **$3.5 million**[125](index=125&type=chunk) [12. Segment Reporting](index=41&type=section&id=12.%20Segment%20Reporting) ESRT operates through two reportable segments: Real Estate and Observatory. Net Operating Income (NOI) for both segments decreased for the three and six months ended June 30, 2025, compared to the prior year, with the Real Estate segment contributing the majority of NOI - ESRT has two reportable segments: **Real Estate** (office, retail, multifamily) and **Observatory** (Empire State Building observatories)[125](index=125&type=chunk) - Net Operating Income (NOI) is the primary measure used by the Chief Executive Officer to evaluate segment performance[126](index=126&type=chunk) Table: Segment Net Operating Income (amounts in thousands) | Segment Net Operating Income | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Real Estate NOI | $97,790 | $100,292 | $188,983 | $193,045 | | Observatory NOI | $3,411 | $4,186 | $3,294 | $4,284 | | Total Net Operating Income | $101,201 | $104,478 | $192,277 | $197,329 | [13. Subsequent Events](index=44&type=section&id=13.%20Subsequent%20Events) There were no material subsequent events reported after June 30, 2025 - No subsequent events were reported[133](index=133&type=chunk) [ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS](index=45&type=section&id=ITEM%202.%20MANAGEMENT'S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) Management discusses ESRT's financial condition and results for the three and six months ended June 30, 2025, covering performance, liquidity, and capital resources [Forward-Looking Statements](index=45&type=section&id=Forward-Looking%20Statements) This section includes a standard disclaimer regarding forward-looking statements, emphasizing that they are subject to substantial risks and uncertainties and do not guarantee future performance - Forward-looking statements are subject to **substantial risks and uncertainties**, many of which are difficult to predict and generally beyond the company's control[137](index=137&type=chunk) - The company does not guarantee that described transactions and events will happen as described and assumes **no obligation to update or revise publicly** any forward-looking statement[137](index=137&type=chunk)[139](index=139&type=chunk) [Highlights for the three months ended June 30, 2025](index=46&type=section&id=Highlights%20for%20the%20three%20months%20ended%20June%2030,%202025) Key highlights for the quarter include net income attributable to common stockholders of $6.5 million, Core FFO of $59.2 million, significant leasing activity, and the acquisition of two retail properties - Net income attributable to common stockholders: **$6.5 million**[140](index=140&type=chunk) - Core Funds From Operations (Core FFO) attributable to common stockholders and the operating partnership: **$59.2 million**[140](index=140&type=chunk) - Signed a total of **232,108 rentable square feet** of new, renewal, and expansion leases[142](index=142&type=chunk) - Closed on the acquisition of two retail properties in Williamsburg, Brooklyn, for an aggregate purchase price of **$31.0 million**[142](index=142&type=chunk) [Results of Operations](index=47&type=section&id=Results%20of%20Operations) This section details the financial performance for the three and six months ended June 30, 2025, compared to 2024, analyzing revenues and expenses across the Real Estate and Observatory segments [Three Months Ended June 30, 2025 Compared to the Three Months Ended June 30, 2024](index=47&type=section&id=Three%20Months%20Ended%20June%2030,%202025%20Compared%20to%20the%20Three%20Months%20Ended%20June%2030,%202024) Total revenues saw a slight increase, but operating income and net income decreased due to higher property operating and Observatory expenses, lower interest income, and the absence of a gain on disposition compared to the prior year Table: Financial Performance (amounts in thousands) | Metric | 2025 | 2024 | Change | % Change | | :---------------------------- | :--- | :--- | :----- | :------- | | Total revenues | $191,250 | $189,543 | $1,707 | 0.9 % | | Total operating expenses | $156,128 | $150,182 | $(5,946) | (4.0)% | | Operating income | $35,122 | $39,361 | $(4,239) | (10.8)% | | Net income | $11,385 | $28,555 | $(17,170) | (60.1)% | | Net income attributable to common stockholders | $6,519 | $17,071 | $(10,552) | (61.8)% | - Rental revenue increased by **$1.1 million (0.7%)** primarily due to higher operating and real estate tax expense escalations[48](index=48&type=chunk)[144](index=144&type=chunk) - Observatory revenue decreased by **$0.2 million (0.7%)** due to lower visitation, attributed to bad weather and reduced international tourism[48](index=48&type=chunk)[148](index=148&type=chunk) - Property operating expenses increased by **$3.4 million (8.1%)** due to higher repair and maintenance costs and cleaning-related payroll[48](index=48&type=chunk)[145](index=145&type=chunk) - Interest income decreased by **$3.2 million (63.3%)** due to lower cash and cash equivalents from debt paydowns and acquisitions[48](index=48&type=chunk)[146](index=146&type=chunk) [Six Months Ended June 30, 2025 Compared to the Six Months Ended June 30, 2024](index=49&type=section&id=Six%20Months%20Ended%20June%2030,%202025%20Compared%20to%20the%20Six%20Months%20Ended%20June%2030,%202024) For the six-month period, total revenues showed a marginal increase, but operating income and net income declined significantly. This was driven by increased operating expenses, general and administrative costs, and interest expense, despite a gain on property disposition Table: Financial Performance (amounts in thousands) | Metric | 2025 | 2024 | Change | % Change | | :---------------------------- | :--- | :--- | :----- | :------- | | Total revenues | $371,316 | $370,722 | $594 | 0.2 % | | Total operating expenses | $310,406 | $300,298 | $(10,108) | (3.4)% | | Operating income | $60,910 | $70,424 | $(9,514) | (13.5)% | | Net income | $27,163 | $38,770 | $(11,607) | (29.9)% | | Net income attributable to common stockholders | $15,739 | $22,732 | $(6,993) | (30.8)% | - Rental revenue increased by **$1.7 million (0.6%)** due to higher operating and real estate tax expense escalations, partially offset by acquisitions and dispositions[151](index=151&type=chunk)[153](index=153&type=chunk) - Observatory revenue decreased by **$1.7 million (2.8%)** due to lower visitation, attributed to bad weather and reduced international tourism[151](index=151&type=chunk)[160](index=160&type=chunk) - Property operating expenses increased by **$3.4 million (3.9%)** due to higher repair and maintenance, cleaning payroll, and utilities[151](index=151&type=chunk)[154](index=154&type=chunk) - General and administrative expenses increased by **$1.6 million (4.8%)** due to higher payroll costs, including accelerated share-based compensation[151](index=151&type=chunk)[155](index=155&type=chunk) - Interest expense increased by **$1.6 million (3.2%)** due to new senior unsecured notes, partially offset by debt repayments[151](index=151&type=chunk)[157](index=157&type=chunk) - Gain on disposition of property increased by **$2.4 million (21.9%)** due to the deconsolidation of the First Stamford Place mezzanine debt obligation in February 2025[152](index=152&type=chunk)[158](index=158&type=chunk) [Liquidity and Capital Resources](index=53&type=section&id=Liquidity%20and%20Capital%20Resources) ESRT maintains strong liquidity with $94.6 million cash and $620.0 million credit facility, supported by $2.1 billion debt with a 5.0-year weighted average maturity - As of June 30, 2025, ESRT had **$94.6 million in cash and cash equivalents** and **$620.0 million available** under its unsecured revolving credit facility[163](index=163&type=chunk) - Total consolidated indebtedness outstanding was approximately **$2.1 billion**, with a weighted average interest rate of **4.34%** and a weighted average maturity of **5.0 years**[163](index=163&type=chunk)[213](index=213&type=chunk) - The company was in **compliance with all financial covenants** related to its unsecured facilities as of June 30, 2025[167](index=167&type=chunk) - **No mortgage debt maturity until April 2026**[168](index=168&type=chunk) - Repaid **$120.0 million borrowings** on the Revolving Credit Facility and **$100.0 million Series A senior unsecured notes** in March 2025[166](index=166&type=chunk)[171](index=171&type=chunk) - Capital expenditures (excluding tenant improvements and leasing commissions) for the six months ended June 30, 2025, were **$26.0 million**[179](index=179&type=chunk) - Estimated additional costs for tenant improvements and leasing commissions under existing lease agreements are approximately **$103.9 million**[180](index=180&type=chunk) - Net cash provided by operating activities increased by **$1.8 million** to **$109.9 million** for the six months ended June 30, 2025[187](index=187&type=chunk) - Net cash used in investing activities increased by **$27.9 million** to **$155.6 million**, primarily due to the acquisition of two retail properties for **$31.7 million**[188](index=188&type=chunk) - Net cash used in financing activities increased by **$436.1 million** to **$246.9 million**, primarily due to debt repayments[188](index=188&type=chunk) [Non-GAAP Financial Measures](index=57&type=section&id=Non-GAAP%20Financial%20Measures) This section reconciles GAAP net income to non-GAAP measures such as Net Operating Income (NOI), Funds from Operations (FFO), Modified FFO, and Core FFO, which management uses to evaluate property performance and provide a comparable basis for investors - NOI, FFO, Modified FFO, and Core FFO are **non-GAAP financial measures** used to evaluate operating performance and are not substitutes for GAAP net income[189](index=189&type=chunk)[195](index=195&type=chunk)[197](index=197&type=chunk)[198](index=198&type=chunk) Table: Non-GAAP Financial Measures (amounts in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :---------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net Operating Income (NOI) | $101,201 | $104,478 | $192,277 | $197,329 | | Funds from Operations (FFO) attributable to common stockholders and the Operating Partnership | $57,255 | $63,099 | $106,684 | $117,117 | | Modified Funds from Operations (Modified FFO) attributable to common stockholders and the Operating Partnership | $59,213 | $65,057 | $110,600 | $121,033 | | Core Funds from Operations (Core FFO) attributable to common stockholders and the Operating Partnership | $59,213 | $65,685 | $111,247 | $122,214 | [Factors That May Influence Future Results of Operations](index=61&type=section&id=Factors%20That%20May%20Influence%20Future%20Results%20of%20Operations) Future results are influenced by leasing activity, Observatory operations, and the broader economic outlook. While global economic uncertainty persists, ESRT believes its diversified, modernized portfolio and strong balance sheet position it well to navigate challenges - As of June 30, 2025, approximately **0.6 million rentable square feet** (7.4% of the commercial portfolio) was available to lease[202](index=202&type=chunk) - Leases representing **3.5% and 5.8% of net rentable square footage** will expire in 2025 and 2026, respectively[203](index=203&type=chunk) - Observatory visitors decreased by **6.7%** to **1,057,000** for the six months ended June 30, 2025, compared to **1,133,000 visitors** in the prior year[204](index=204&type=chunk) - Observatory revenue decreased by **2.8%** to **$57.1 million** for the six months ended June 30, 2025, primarily due to lower visitation[204](index=204&type=chunk) - ESRT acknowledges global economic uncertainty but believes its **diversified, modernized, and energy-efficient NYC-focused portfolio**, coupled with a **strong balance sheet** and **no near-term debt maturities**, provides a good competitive position[206](index=206&type=chunk)[207](index=207&type=chunk)[208](index=208&type=chunk) [Critical Accounting Estimates](index=63&type=section&id=Critical%20Accounting%20Estimates) There were no material changes to the critical accounting estimates disclosed in the company's Annual Report on Form 10-K - No material changes to critical accounting estimates disclosed in the Annual Report[209](index=209&type=chunk) [ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK](index=64&type=section&id=ITEM%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) ESRT manages interest rate risk using fixed-rate debt and derivatives, with $448.0 million notional value and $2.1 billion fixed-rate indebtedness at 4.34% - ESRT uses interest rate swaps and caps to mitigate interest rate risk, with an aggregate notional value of **$448.0 million** as of June 30, 2025[211](index=211&type=chunk)[212](index=212&type=chunk) - The weighted average interest rate on **$2.1 billion of fixed-rate indebtedness** outstanding was **4.34% per annum** as of June 30, 2025[213](index=213&type=chunk) - The fair value of outstanding debt was approximately **$2.0 billion**, which was **$98.3 million less than the book value** as of June 30, 2025[214](index=214&type=chunk) [ITEM 4. CONTROLS AND PROCEDURES](index=64&type=section&id=ITEM%204.%20CONTROLS%20AND%20PROCEDURES) Management, including the CEO and CFO, concluded that ESRT's disclosure controls and procedures were effective as of June 30, 2025, and reported no material changes to internal control over financial reporting during the period - Disclosure controls and procedures were evaluated and deemed **effective** as of June 30, 2025[216](index=216&type=chunk) - No material changes to internal control over financial reporting occurred during the period covered by the report[217](index=217&type=chunk) [PART II. OTHER INFORMATION](index=64&type=section&id=PART%20II.%20OTHER%20INFORMATION) This part covers legal proceedings, risk factors, equity sales, defaults, mine safety, other information, and exhibits for the reporting period [ITEM 1. LEGAL PROCEEDINGS](index=64&type=section&id=ITEM%201.%20LEGAL%20PROCEEDINGS) This section refers to Note 9 of the financial statements for a description of legal proceedings, indicating no new material information beyond what is already disclosed - Legal proceedings are described in **Note 9 Commitments and Contingencies** of the Financial Statements[218](index=218&type=chunk) [ITEM 1A. RISK FACTORS](index=66&type=section&id=ITEM%201A.%20RISK%20FACTORS) There have been no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K as of June 30, 2025 - No material changes to risk factors as of June 30, 2025, referring to the Annual Report on Form 10-K for the year ended December 31, 2024[219](index=219&type=chunk) [ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS](index=66&type=section&id=ITEM%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS) ESRT reported no unregistered sales of equity securities during the period. The company continued its repurchase program, buying back 310,415 shares of Class A common stock in April 2025 - No unregistered sales of equity securities occurred[220](index=220&type=chunk) - Under the repurchase program, **310,415 shares of Class A common stock** were purchased in April 2025 at an average price of **$6.92 per share**[222](index=222&type=chunk) - The maximum approximate dollar value available for future purchases under the **$500 million program** remained at **$497.9 million** as of June 30, 2025[222](index=222&type=chunk) [ITEM 3. DEFAULTS UPON SENIOR SECURITIES](index=66&type=section&id=ITEM%203.%20DEFAULTS%20UPON%20SENIOR%20SECURITIES) The company reported no defaults upon senior securities during the period - No defaults upon senior securities were reported[223](index=223&type=chunk) [ITEM 4. MINE SAFETY DISCLOSURES](index=66&type=section&id=ITEM%204.%20MINE%20SAFETY%20DISCLOSURES) This item is not applicable to Empire State Realty Trust, Inc - Mine safety disclosures are not applicable to the registrant[224](index=224&type=chunk) [ITEM 5. OTHER INFORMATION](index=66&type=section&id=ITEM%205.%20OTHER%20INFORMATION) No other material information was reported under this item, and no directors or officers adopted, terminated, or modified Rule 10b5-1 trading arrangements during the quarter - No directors or officers adopted, terminated, or modified a Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement during the three months ended June 30, 2025[226](index=226&type=chunk) [ITEM 6. EXHIBITS](index=67&type=section&id=ITEM%206.%20EXHIBITS) This section lists all exhibits filed with the Form 10-Q, including credit agreement amendments, certifications, and XBRL interactive data files - Includes the **First Amendment to Credit Agreement** dated May 28, 2025[227](index=227&type=chunk) - Certifications of Chief Executive Officer and Principal Financial Officer (Sections 302 and 906 of Sarbanes-Oxley Act of 2002) are filed herewith[227](index=227&type=chunk) - XBRL Instance Document and Taxonomy Extension Documents are included[227](index=227&type=chunk) [SIGNATURES](index=68&type=section&id=SIGNATURES) The report is duly signed on behalf of Empire State Realty Trust, Inc. by Stephen V. Horn, Executive Vice President, Chief Financial Officer & Chief Accounting Officer, on August 6, 2025 [Signature Block](index=68&type=section&id=Signature%20Block) The report is signed by Stephen V. Horn, Executive Vice President, Chief Financial Officer & Chief Accounting Officer, on August 6, 2025 - Signed by **Stephen V. Horn, Executive Vice President, Chief Financial Officer & Chief Accounting Officer**[232](index=232&type=chunk) - Date of signature: **August 6, 2025**[232](index=232&type=chunk)