Vornado Realty Trust (NYSE:VNO) Q4 2025 Earnings call February 10, 2026 10:00 AM ET Company ParticipantsGlen Weiss - EVPMichael Franco - President and CFOSteve Borenstein - EVP and Corporate CounselSteven Roth - Chairman and CEOThomas Sanelli - EVP of Finance and Chief Administrative OfficerConference Call ParticipantsAlexander Goldfarb - AnalystAnnabelle Ayer - AnalystAnthony Paolone - AnalystDylan Burzinski - AnalystFloris van Dijkum - AnalystJana Galan - AnalystJohn Kim - AnalystNick Yulico - AnalystSeth ...

Financial Data and Key Metrics Changes - Comparable FFO for 2025 was $2.32 per share, slightly higher than 2024 and better than anticipated [26] - Fourth quarter comparable FFO was $0.55 per share, down from $0.61 per share in Q4 2024, primarily due to higher net interest expense [26] - Same-store GAAP NOI increased by 5% for the quarter, while same-store cash NOI decreased by 8.3% [27] Business Line Data and Key Metrics Changes - In 2025, the company leased 4.6 million sq ft of office space, with 3.7 million sq ft in Manhattan, marking the highest leasing volume in over a decade [6] - Average starting rents in Manhattan were $98 per sq ft, with mark-to-markets of +10.4% GAAP and +7.8% cash [7] - Office occupancy rose from 88.8% to 91.2% in 2025, driven by significant leasing activity [12][28] Market Data and Key Metrics Changes - The New York office market is experiencing a tightening landlord's market, with robust tenant demand from finance and tech sectors [4] - The financing markets for Class A assets are strong, with CMBS spreads at their tightest since 2021 [29] - The company has a liquidity of $2.39 billion, including cash balances of $978 million and undrawn credit lines of $1.41 billion [22] Company Strategy and Development Direction - The company is focused on its Manhattan-centric office strategy, with significant developments planned, including 350 Park Avenue and 623 Fifth Avenue [5][15] - The company aims to capitalize on the shortage of large blocks in better buildings by bringing prime space to market [14] - The management team is committed to maintaining a highly liquid, cash-heavy balance sheet while exploring stock buybacks [22][24] Management's Comments on Operating Environment and Future Outlook - Management believes the current fundamentals in Manhattan are the best in 20 years, with expectations for continued tightening in the landlord's market [4] - The company anticipates significant earnings growth in 2027 as the positive impact from PENN 1 and PENN 2 lease-up takes effect [28] - Management acknowledges the disconnect between stock price and asset value, viewing current stock buybacks as an attractive investment opportunity [24][25] Other Important Information - The company has extended maturities on nearly $3.5 billion of debt through 2031 and has been active in refinancing to bolster liquidity [23][30] - The acquisition of 623 Fifth Avenue is viewed as a strategic move, with plans to create a high-quality boutique office space [15][16] - The company is also developing a 475-unit rental residential building on 34th Street, expected to break ground in the fall [19] Q&A Session Summary Question: Changes in the structure of 350 Park Avenue - Management confirmed that there were amendments related to the overall deal, providing flexibility in equity percentage [35] Question: Overall leasing pipeline and tenant conversations - The leasing pipeline remains strong, with over half of the activity from new tenants and significant expansion from financial services and law firms [40] Question: Cash and GAAP same-store NOI difference - Management expects to see cash NOI turn positive in the second half of 2026 as free rent periods end [45] Question: Retail market conditions on Upper Fifth Avenue - The retail market is improving but still struggling to meet top-tick rents from four or five years ago [48] Question: Difference between GAAP occupancy and leased occupancy - The $200 million difference is not annualized and will be recognized as tenants build out their spaces [51]

JANUARY 2026 Insert title here Breaking the Cycle: Back to Basics China Property Outlook 2026 Breaking the Cycle China's real estate market enters 2026 in a state of deep reassessment. Four years of subdued leasing, soft sales absorption, weaker footfall, rising vacancies, cautious capital, and persistent debt strain have pushed every asset class into a defensive posture. The old model—relying on scale, momentum, and rising prices—no longer offers a path forward. What the sector faces today is not simply cy ...

The Saks Global bankruptcy means disruption across the retail landscape, but from the Simon Property Group’s point of view, there’s also upside. According to David Simon, the chairman, chief executive officer and president of the real estate giant, retailers that don’t make it can be replaced with more productive stores at higher rents. More from WWD “With Off Fifth, their productivity and rents are just so cheap that there’s a tremendous amount of upside,” said Simon, on a conference call after the com ...

Hong Kong Market Report Q4 2025 Jan 2026 This report analyses the performance of Hong Kong's office, knightfrank.com.hk/research residential and retail property markets Office Finance sector and PRC-related demand drive solid take-up in premium office spaces in Central, while existing vacant space and future supply still hinder overall rental growth Q4 2025 Office Highlights Total Grade-A Office Vacancy Average Unit Rent (Net sq ft) Quarterly Take-up (Net sq ft) 15.6% HK$49.5 +880,125 Table 1 : Q4 2025 Majo ...

Summary of Hong Kong Property Market Conference Call Industry Overview - The Hong Kong property market is upgraded to an "Attractive" industry view, with expectations for positive year-on-year (YoY) growth across residential prices, Central office rents, and retail sales for the first time since 2018 [1][10][14]. Key Insights Residential Market - **Price Growth**: HK residential prices are projected to rise by 10% in 2026, following a 5% increase in 2025. This growth is attributed to the removal of additional stamp duty, increased immigration, and a strong stock market [4][10][42]. - **Population Growth**: Immigration from mainland China is expected to double to 140,000 per annum post-COVID, contributing to positive population growth and housing demand [4][45]. - **Affordability Improvement**: Median household income is increasing, leading to improved affordability, which is expected to stimulate demand for home purchases [47][49]. Office Market - **Rent Recovery**: Central office rents are expected to increase by 3% in 2026, recovering from a 40% decline from peak levels. This is driven by a flight to quality and increased demand from asset management companies and hedge funds [5][10][14]. - **Vacancy Rates**: Despite high vacancy rates, there is a noted recovery in demand for quality office spaces [10]. Retail Market - **Sales Growth**: HK retail sales are anticipated to grow by 3% in 2026, supported by increased visitation from mainland tourists due to easier visa access [6][10]. - **Challenges**: Concerns remain regarding the rise of online retail and competition from cheaper products in Shenzhen, as well as the growing trend of tax-free shopping in mainland China [6][10]. Investment Themes - **Residential Upcycle**: Focus on companies benefiting from the residential market recovery [14][19]. - **Early-Stage Office Recovery**: Investment in firms with active capital recycling strategies [19]. - **Luxury Retail**: Preference for companies involved in luxury retail, particularly those benefiting from mainland tourism [19]. Stock Recommendations Overweight Ratings - **SHKP**: Key proxy for home price recovery with a price target of HK$120.00, representing a 24% upside [21]. - **Henderson**: Beneficiary of home price upturn with a price target of HK$36.00, also a 24% upside [21]. - **CKA**: Upgraded to Overweight due to active land banking and a strong cash position [17][21]. - **Swire Properties**: Upgraded to Overweight based on active capital recycling and improving office fundamentals [17][21]. Underweight Ratings - **NWD**: Ongoing liquidity concerns and cash flow pressures, with a price target of HK$6.50, indicating a 12% downside [25]. - **Wharf**: Challenging operating outlook with a price target of HK$21.00, suggesting a 5.9% downside [25]. - **Link REIT**: Downgraded to Equalweight due to slower-than-expected recovery in mass retail [17][25]. Market Dynamics - **NAV Discounts**: The discount to NAV for HK property stocks is expected to narrow from 50% to 30% if the upcycle continues, potentially driving stock prices up by 15-30% [26][27]. - **EPS Outlook**: While EPS may remain depressed due to lower margins from past projects, the focus will likely shift to NAV discounts in the stock market [26]. Conclusion - The Hong Kong property market is entering a recovery phase, with positive growth expected across residential, office, and retail sectors. Investment strategies should focus on companies that are well-positioned to benefit from these trends, particularly in residential and luxury retail segments.

Investment Rating - The report provides a positive investment rating for the industry, indicating growth potential and favorable market conditions [1]. Core Insights - The industry is projected to experience significant growth, with a forecasted revenue of 18,322.3 billion in 2025, up from 15,081.0 billion in 2024, representing a year-on-year increase of approximately 14.8% [3][10]. - Key growth drivers include technological advancements and increasing consumer demand, particularly in the TMT (Technology, Media, and Telecommunications) sector, which is expected to grow by 29% [24][28]. - The report highlights a trend of increasing average rents in prime shopping centers, with a notable increase of 10.4% in 2025 [28]. Summary by Sections Revenue Forecast - The industry is expected to generate revenues of 18,322.3 billion in 2025, with a steady growth trajectory observed from previous years [3][10]. - The revenue growth rates for the upcoming years are projected at 6.1% for 2025, indicating a robust market outlook [5]. Sector Performance - The TMT sector is highlighted as a key performer, with a projected growth rate of 29% [24]. - The average rental rates in prime locations are anticipated to rise, reflecting increased demand and market confidence [28]. Market Trends - The report notes a significant increase in consumer spending and investment in technology, which are driving the overall growth of the industry [28]. - The average rent in prime shopping centers is expected to increase by 10.4% in 2025, indicating a strong recovery and demand in the retail sector [28].

Financial Data and Key Metrics Changes - Third-quarter comparable FFO was $0.57 per share, compared to $0.52 per share for the same quarter last year, beating analyst consensus by $0.02 [24] - Same-store GAAP NOI for the New York business overall was up 9.1% for the quarter, while same-store cash NOI was down 7.4% [24] - Net debt-to-EBITDA ratio improved to 7.3 times from 8.6 times at the start of the year, with immediate liquidity of $2.6 billion [28] Business Line Data and Key Metrics Changes - During the first nine months of 2025, Vornado leased 3.7 million sq ft overall, with 2.8 million sq ft in Manhattan office [10] - Average starting rents for Manhattan office leasing were $99 per sq ft, with mark-to-markets of plus 11.9% GAAP and plus 8.3% cash [10] - In the third quarter, 21 New York office deals totaled 594,000 sq ft at starting rents of $103 per sq ft, with mark-to-markets of plus 15.7% GAAP and 10.4% cash [11] Market Data and Key Metrics Changes - Midtown core better building vacancy is now down to 6.2%, indicating a shift to a landlord's market [9] - Manhattan office leasing activity is on pace to exceed 40 million sq ft for the year, the highest since 2019 [9] - New York office occupancy increased to 88.4% from 86.7% last quarter, primarily due to leasing activity at Penn 2 [26] Company Strategy and Development Direction - The company is focused on the Penn District as a growth engine, with plans for a 475-unit rental residential building and retail redevelopment [14][15] - The acquisition of 623 Fifth Avenue is aimed at transforming it into a high-end boutique office building [16][17] - The Manhattan retail market is showing strength, with tenants approaching landlords for early renewals [19] Management's Comments on Operating Environment and Future Outlook - Management remains optimistic about the demand for office space, noting that tenant demand is robust across all industries [6][9] - The company expects 2025 leasing volume for Manhattan office to be the highest in over a decade [10] - Management anticipates significant earnings growth in 2027 as the full impact of Penn 1 and Penn 2 leases takes effect [25] Other Important Information - The company has generated $1.5 billion in net proceeds from sales and financings, paying down $900 million in debt [28] - Signage revenue for 2025 is projected to be the highest year ever, with the company owning the largest signage portfolio in New York City [19][20] - The company is involved in the Penn Station transformation project, supporting improvements that benefit its holdings [54][56] Q&A Session Summary Question: How is the leasing strategy changing at Penn 2? - Rents have increased, with average rent at $112 per sq ft, and the company is confident in its leasing strategy for the remaining space [32] Question: How will leasing for 623 Fifth Avenue be approached? - The company plans to market the building with complete designs to attract high-end tenants [34] Question: What is the current signed-not-open pipeline? - The company expects over $200 million in revenue from signed leases over the next couple of years, with the bulk coming in 2027 [40] Question: What is the expected trajectory of occupancy next year? - The company anticipates reaching 90% occupancy in the next quarter or two, with continued growth thereafter [53] Question: What are the plans for proceeds from non-core asset sales? - Proceeds will be used to strengthen the balance sheet and potentially for compelling external acquisitions [66] Question: What is the status of the Penn Station transformation project? - The company supports improvements to Penn Station and is involved in the process, focusing on retail opportunities [54][56] Question: What are the expectations for rent growth in the coming years? - The company expects rent growth to exceed 20%-25% over the next four to five years due to strong demand and limited supply [61]

Core Insights - Vornado Realty Trust's (VNO) third-quarter 2025 adjusted funds from operations (FFO) were 57 cents per share, exceeding the Zacks Consensus Estimate of 55 cents and reflecting a year-over-year increase of 9.6% [1][11] - Total revenues for the quarter reached $453.7 million, surpassing the Zacks Consensus Estimate of $443.3 million, with a year-over-year growth of 2.4% [2][11] Financial Performance - Total same-store net operating income (NOI) was $266.7 million, up from $265.5 million in the prior year, with notable increases of 9.1% in the New York portfolio and 3.8% in the 555 California Street portfolio, while THE MART saw a decrease of 10.4% [3][11] - The occupancy rate in the total New York portfolio improved to 87.5%, an increase of 80 basis points year over year, with THE MART at 80.7% (up 100 bps) and 555 California Street at 96.3% (up 180 bps) [7][11] Leasing Activity - In the New York office portfolio, 594,000 square feet were leased at an initial rent of $102.60 per square foot, with a weighted average lease term of 12.5 years [4] - The New York retail portfolio saw 27,000 square feet leased at an initial rent of $292.79 per square foot, with a weighted average lease term of 9 years [5] - At THE MART, 158,000 square feet were leased at an initial rent of $48.84 per square foot, with a weighted average lease term of 10.5 years [6] Portfolio Activity - Vornado acquired the 623 Fifth Avenue office condominium for $218 million, which includes 382,500 rentable square feet and is currently 75% vacant, with plans for redevelopment by 2027 [8][11] - A joint venture, in which Vornado holds a 55% interest, sold the 512 West 22nd Street office building for $205 million [9][11] Balance Sheet - Vornado ended the quarter with cash and cash equivalents of $1.01 billion, a decrease from $1.2 billion as of June 30, 2025 [10]

Financial Data and Key Metrics Changes - Net income for Q2 2025 decreased 72% to $600,000 or $0.03 per share compared to $2,000,000 or $0.11 per share in the same period last year, primarily due to due diligence related legal expenses and lower interest income [3] - The company's pro rata share of NOI in Q2 increased 5% year over year to $9,700,000, driven by higher contributions from multifamily and mining royalty segments [3][19] Business Line Data and Key Metrics Changes - The multifamily segment contributed an additional $57,000 of NOI year over year, while the mining segment contributed an additional $637,000 of NOI [3] - The industrial and commercial segment NOI decreased by $177,000 year over year due to tenant eviction and lease expirations [4] - Mining and royalty business segment revenues and NOI for the quarter totaled $3,600,000 and $3,700,000 respectively, an increase of 1221% over the same period last year [6] - The multifamily segment reported total revenues and NOI of $14,600,000 and $8,200,000 respectively, with a 94% occupancy rate for apartments and 83% for retail space [7] Market Data and Key Metrics Changes - The average rental rate of expiring industrial leases was $6.55 triple net, with expectations for new rental rates to start in the sevens or greater [15] - New deliveries in the DC market are expected to pressure vacancies, concessions, and revenue growth in the foreseeable future [9] Company Strategy and Development Direction - The company plans to continue focusing on leasing existing industrial space and managing the delivery of new industrial products for 2026 [15][20] - The company is pursuing a business opportunity that involves legal expenses, but this does not indicate a shift in strategy [24] - The company aims to double the size of its industrial portfolio by 2030 [20] Management's Comments on Operating Environment and Future Outlook - Management cautioned that NOI growth would be flat or slightly negative during the time it takes to lease up the first building in the industrial development growth strategy [18] - The company anticipates challenges in matching 2024's NOI numbers due to a nonrepeatable event in the mining royalties segment [19] - Management remains optimistic about rental rates and expects market vacancies to top out in 2025, which should bode well for demand and rent growth [15] Other Important Information - The company is in the predevelopment stage for a 170-acre industrial land project in Cecil County, Maryland, with permits expected in early 2026 [11] - The multifamily development project in Greenville, South Carolina, is expected to be ready for lease up in Q4 2027 [14] Q&A Session Summary Question: Inquiry about legal expenses related to a potential new investment - Management confirmed that the legal expenses are related to pursuing a business opportunity but clarified that it does not indicate a shift in strategy [24][25]