Core Insights - Sustainability leadership is becoming a competitive advantage, reducing regulatory risks and energy costs while attracting tenants with high ESG standards [1] - The Empire State Building Observatory has shown resilient performance through increased revenue per capita and domestic demand, despite a decline in international tourist visitation [1] Financial Performance - The company executed all-cash acquisitions, such as 130 Mercer in SoHo, leveraging a proactive balance sheet to ensure certainty of close in a volatile capital market [2] - The Manhattan office portfolio maintained pricing power with 18 consecutive quarters of positive mark-to-market lease spreads, reaching 6.4% in the fourth quarter [2] Occupancy and Strategic Transformation - The company achieved 12 consecutive quarters of office occupancy above 90%, driven by a flight-to-quality trend favoring modernized, transit-oriented, and sustainability-leading buildings [3] - A five-year strategic transformation was completed to focus on a 100% New York City portfolio, involving the disposal of suburban assets and acquiring over $1 billion in high-quality Manhattan and Brooklyn real estate [3] Future Expectations - For 2026, FFO and same-store cash NOI are expected to remain flat compared to 2025, mainly due to temporary downtime between the FDIC lease expiration and the commencement of the LinkedIn backfill [3] - Management anticipates exiting 2026 with higher overall occupancy and a 5% to 10% reduction in run-rate G&A expenses driven by compensation and cost-reduction initiatives [3] Acquisition and Guidance - The acquisition of 130 Mercer is projected to achieve a stabilized yield of approximately 8% through the lease-up of a vacant 110,000 square foot office block in a supply-constrained submarket [3] - Observatory NOI guidance is set at $87 million to $92 million, accounting for a $2 million decline in fixed license fees, with a shift towards more upside from recovering international visitation [3] Capital Allocation - Capital allocation will remain balanced between underwriting new NYC investments, strategic capital recycling, and opportunistic share repurchases [3]