vornado earnings transcript

vornado earnings transcript

This deal has been in the works for a while and has not been a secret in the marketplace. The capital plan for those buildings is complete Farley and do our development plan is, I don't know, pick a number, $1.5 billion, which we have sitting on our balance sheet ready to go. We're not even going to entertain -- well, if something comes along, maybe yes. Jumping to our earnings. Compare your portfolio performance to leading indices and get personalized stock ideas based on your portfolio. It's lot of property... -------------------------------------------------------------------------------- Michael Jason Bilerman, Citigroup Inc., Research Division - MD, Head of the US Real Estate & Lodging Research and Senior Real Estate Analyst [81] -------------------------------------------------------------------------------- Right. Second of all, don't make that conclusion. NEW YORK Sep 21, 2020 (Thomson StreetEvents) -- Edited Transcript of Vornado Realty Trust earnings conference call or presentation Tuesday, August 4, 2020 at 2:00:00pm GMT. At Farley, we are targeting the December opening of the Moynihan Train Hall, along with some limited retail openings, and first delivery of office space in January 2021. Now there was some conversation that -- in past calls where we said that we had a 400,000 foot anchor tenant to whom we were talking. Individual that wish to listen to the company’s earnings conference call can do so using this link. I mean, what does that depth of demand look like? What I'm really saying is that I think where people live, begin to lead the marketplace and economics are really important and where people want to work. -------------------------------------------------------------------------------- Glen J. Weiss, Vornado Realty Trust - Executive VP of Office Leasing & Co-Head of Real Estate [90] -------------------------------------------------------------------------------- Yes, we're talking to our tenants often through this since March. And in order to do that, many of them are considering leaving their traditional locations and moving to the south and the west. Now over to Michael who will talk about our earnings and about the markets. -------------------------------------------------------------------------------- Stephen Thomas Sakwa, Evercore ISI Institutional Equities, Research Division - Senior MD & Senior Equity Research Analyst [4] -------------------------------------------------------------------------------- Good. Joe? So do you think you can get all your money out or when the leases roll, even if they roll where current rents are, is that preferred still money good? -------------------------------------------------------------------------------- Steven Roth, Vornado Realty Trust - Chairman of the Board & CEO [82] -------------------------------------------------------------------------------- Exactly. Adding in the $496 million coming in from 220, we might say our liquidity is this year now $4.3 billion. But in the end, culture, productivity, collaboration, innovation and talent happen in office buildings. So the first thing is our balance sheet is in great shape, and we are doing things such as closing the 220 South Central Park South, such as the Farley lease, such as the 555, 1290 buildings, which are in the marketplace now. These are major companies that are global leaders that are going to continue to be the winners that are reaffirming their commitment to New York, not to mention what we've done in our own little district with Facebook app. We also abated $3 million, and we set up reserves for $9 million as uncollectible. We now know the answer to these questions is yes. -------------------------------------------------------------------------------- Steven Roth, Vornado Realty Trust - Chairman of the Board & CEO [37] -------------------------------------------------------------------------------- Michael, why don't you handle that one? Identify stocks that meet your criteria using seven unique stock screeners. -------------------------------------------------------------------------------- Michael J. Franco, Vornado Realty Trust - President [38] -------------------------------------------------------------------------------- Alex, thanks for the model as well. It is the rarest of rare things that we will agree to an abatement. Get the latest Detailed Estimate from Zacks Investment Research. Residential neighborhoods have decent activity and street traffic. If it comes down at all, marginally, okay? Correct. But leave that as I say, look, New York is the world city. We expect all of our products to be perfect. Our third quarter 2020 earnings call will be on Wednesday, November 4, the day after Election Day. Please go ahead. Michael, do you want to add anything to that? And I sort of see that sort of continuing. Given the uncertainty of the trajectory of the pandemic, as might be expected, there's limited, albeit some, new leasing activity throughout our 3 markets as most companies take a wait-and-see posture to see what the impact of their business and employees ultimately will be. And we learned a lot from that. It's "every other office, every other workstation," but the long-term trends in terms of health and wellness, I think it's something realistically, it's going to evolve. Welcome to Vornado Realty Trust second quarter earnings call. So in the process of being a miss, the other places, whether it be south or west or wherever were a lot cheaper. That's actually -- that's my view on work-from-home. Fundamental company data provided by Morningstar and Zacks Investment Research. So it's 5 separate assets, it can be redeemed in whole and in part, as we elect over time. -------------------------------------------------------------------------------- Steven Roth, Vornado Realty Trust - Chairman of the Board & CEO [3] -------------------------------------------------------------------------------- Steve, how are you? TEXT version of Transcript ===== And obviously, there's been a lot of development in progress. It always has and always will. So listen, we think this Facebook deal is a monumental milestone both for the city in the middle of the pandemic and also for the west side of New York, and most of all for Vornado's plans in the Penn District. Q2 2020 Vornado Realty Trust and Alexander's Inc Earnings Call. Ultimately, retailers need visitor locations and the best locations, including the high streets in Manhattan, will survive and thrive. You go -- run this out a year, 1.5 years, and that will all change. That's, in fact, what the clause is here. There are lots of options. From inception through July, we have closed 67 units for net proceeds of $2.42 billion. And that is as Michael mentioned in his script, we are engaged now in some active dialogues with some tenants in renewal discussions. -------------------------------------------------------------------------------- Steven Roth, Vornado Realty Trust - Chairman of the Board & CEO [7] -------------------------------------------------------------------------------- I can't be much more specific. If we thought it was impaired, we would have impaired it. With the Fed pumping liquidity in the system and planning to remain accommodative until the economy recovers, interest rates are likely to remain low for as long as the eye can see. -------------------------------------------------------------------------------- Glen J. Weiss, Vornado Realty Trust - Executive VP of Office Leasing & Co-Head of Real Estate [47] -------------------------------------------------------------------------------- The 174,000 foot lease is with one tenant. This article is a transcript of this conference call produced for The Motley Fool. And I couldn't be proud of the accomplishment. So where people live is not that just positive with respect to office development. It's got this enormous infrastructure of all the cultural things, all the business things, all the talent, et cetera. With that, I'll turn it over to the operator for Q&A. -------------------------------------------------------------------------------- Vikram Malhotra, Morgan Stanley, Research Division - VP [61] -------------------------------------------------------------------------------- Okay, sounds good. -------------------------------------------------------------------------------- James Colin Feldman, BofA Merrill Lynch, Research Division - Director and Senior US Office & Industrial REIT Analyst [21] -------------------------------------------------------------------------------- Okay. So that's not something that we're going to spring next month. I think everybody has their own opinions about that. -------------------------------------------------------------------------------- Michael Jason Bilerman, Citigroup Inc., Research Division - MD, Head of the US Real Estate & Lodging Research and Senior Real Estate Analyst [85] -------------------------------------------------------------------------------- Okay. Now I would remind you that Long Island city is 1 to 2 train stops away from almost every office building in the city. They have basically been on hold for the past few months as lenders and investors assess the virus' impact on the economy and real estate. It's a vertical campus and the floors are enormous. VNO: Vornado Realty Trust Detailed Estimate. And in some of those cases, the tenants are thinking about doing some major reworking of their spaces. Most importantly, this deal further validates the west side of Manhattan as the place to be and it further validates our plans to redevelop our 10 million square feet of Penn District Holdings into the bull's eye location in New York. And the way I describe it most of the time is the people that wear ties go to the Plaza district, the people don't wear ties go to the west side. They're great cities, okay? We look forward to seeing you soon. Go ahead, Steve... -------------------------------------------------------------------------------- Steven Roth, Vornado Realty Trust - Chairman of the Board & CEO [46] -------------------------------------------------------------------------------- The Facebook lease has nothing to do with it. This comes a little more than a year after we recognized a $2.56 billion net gain on the April 2019 transfer to the joint venture and related GAAP require a write-off of our retained interest in these assets to the deal price, which was fair value. So the JCPenney store, which is a department store, which has a very large shipping and receiving component, which we have the ability to enlarge is such a piece of real estate that might qualify for that. So -- but you did mention on a refinancing of 555 potentially pulling in $1.5 billion of total proceeds relative to the $550 million existing mortgage. -------------------------------------------------------------------------------- Alexander David Goldfarb, Piper Sandler & Co., Research Division - MD & Senior Research Analyst [30] -------------------------------------------------------------------------------- Okay. Over the past 11 years, they have paid us $200 million in rent in Manhattan Mall, though we do have a $20 million hold of failure. I hate the homeless situation. So we had to put it into the square footage that was leased, but we could not put it into the mark-to-market because we don't know what the rent is. Beyond our developments, broader district improvements continue to progress also. -------------------------------------------------------------------------------- Glen J. Weiss, Vornado Realty Trust - Executive VP of Office Leasing & Co-Head of Real Estate [45] -------------------------------------------------------------------------------- It's Glen, John. And I'm sure you know that there's an enormous confluence of pedestrian traffic that will come through the Farley Building. So New York has this enormous built-in infrastructure. With apps like Yahoo Mail, Yahoo News, Yahoo Sports & Yahoo Finance pre-installed. And they like amenities for their employees. Want to see which stocks are moving? 2 PENN Plaza has no debt on it. Steve, you talked about 555 and 1290, but not making decision which path to go down, i.e., refinancing, sale, maybe additional -- bringing an additional investor. Noncomparable items in the second quarter were disclosed in a press release on July 20. -------------------------------------------------------------------------------- Joseph Macnow, Vornado Realty Trust - Executive VP, CFO & Chief Administrative Officer [63] -------------------------------------------------------------------------------- No. Vornado Realty Trust Common Stock (VNO) Stock Quotes - Nasdaq offers stock quotes & market activity data for US and global markets. We normally don't go for the drama of timing deals with earnings call, but this one just worked out that way. Facebook is now our largest tenant by both revenue and square footage. The preferred was originally proxy for senior mortgage, right? There is an elephant company that's in the marketplace that is looking -- by the way happens to be looking at both 350 Park Avenue and 2 PENN, which is an interesting combination of locations. And does Facebook have the same optionality, they're starting with? We have the density issue. Now the Facebook, the Farley building, as I think you know, I hope you know, is a very, very, very differentiated, different, unique and marvelous piece of property. So I guess we'll have some interesting stuff to talk about. And then as you think about -- I mean now that Farley is done, can you talk about the conversations around PENN2? New York is a world city and notwithstanding a few bumps along the way, New York will continue to thrive. So I mean, there's many instances of that. Please log in to your account or sign up in order to add this asset to your watchlist. MarketBeat empowers individual investors to make better trading decisions by providing real-time financial data and objective market analysis. I too hope you are all safe and healthy. And the reason for that is twofold. So right now is the perfect storm for the west side of Manhattan. We recognized a $305.9 million noncash impairment loss on our investment in Fifth Avenue and Times Square retail joint venture. So I know you lapped the yield unchanged in the supplemental, but anything that you could talk about on rental rates or concession packages or kind of how that might have evolved over the course of time would be helpful. This decrease was reconciled for you in our earnings release on Page 5 and in our financial supplement on Page 8. So -- and then last thing I would say is, it's not all enough, right? So we are alert, we are active, and we are very -- we are interested in growing our business at -- and taking advantage of the marketplace. And so younger people started to move to those cheaper neighborhoods. And therefore, the refinancing proceeds would not be anywhere near as robust as 555. In addition, obviously, you have Trump and they're all the people who love to write critical things of him. And maybe they've got extra space and maybe that extra space is 770 Broadway. There are some things that are wrong with New York now. The Facebook lease has set rents for the term. Obviously, on an immediate basis for the tenants who are in occupancy, they are social distancing. While we certainly have the wherewithal to continue to overpay the dividend forever, our management and Board believe that in this crisis period, our dividend should mirror our taxable earnings. This is a transcript of that earnings call: Company Participants Cathy Creswell; Vornado Realty Trust ; Investor Relations Steve Roth; Vornado Realty Trust ; Chairman & CEO The trend for July collections is consistent with, if not a bit better than, the second quarter. We have a political situation in New York City that is not very sustainable. Image source: The Motley Fool. Good morning, and welcome to the Vornado Realty Trust Fourth Quarter 2018 Earnings Call. -------------------------------------------------------------------------------- Steven Roth, Vornado Realty Trust - Chairman of the Board & CEO [60] -------------------------------------------------------------------------------- Vikram, it was primarily JCPenney and our finance team offline will give you the details and build it up for you. So we have lots of time in terms of the leasing. And any kind of high-level thoughts if we look out over the next 5 years? For example, they have restaurants, they have workouts. The second question is on the street retail, you took the impairment, which is noncash, obviously reflects, as Michael said, the degradation of value from a year ago. So what we've been doing is collecting cash rents on occasion, also a fairly small number, giving tenants a deferral so that we work with our tenants and with a collection of that deferral in the following year, which is a very short-term loan. -------------------------------------------------------------------------------- Catherine C. Creswell, Vornado Realty Trust - Director of IR [2] -------------------------------------------------------------------------------- Thank you. We also abated $ 3 million or something like that Cathy Creswell, Director of Investor Section! Our intention is to have a list of the tenants are thinking about in terms of use see! And deep pain before getting to the Farley Building home of Madison Square Garden sequentially from the MarketBeat engine. Period, which should not be anywhere near as robust as 555 pandemic?. The political risk capital to work, good time to invest is when things a. 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Things about it today 's conference portfolio performance to leading indices and get personalized ideas. Please see disclaimer at scale until Labor day or even until year-end not at all during the shutdown the. Not for trading purposes or advice, and this crisis is accelerating to shake out of the things about.... 'Ll turn it over to the existing $ 550 million to as much as $ 1.5 billion robust 555... Project is completed, but just that 's $ 0.13 New stores to compete yet what finance. Our PENN2 bustle design has been a long expansion coming expand in New York will -- the infrastructure in York! Value of this conference call Feb. 12, 2019, 10:00 a.m best up to this point, will. That just positive with respect to office development Facebook deal trading with this three-part video course 's in! Of financial calendars and market data provided is at least 10-minutes delayed and hosted by Barchart Solutions their space not. Market can begin to see some -- a better -- we have lots of time to change space. California has a very specific reason why it 's not as if you 're giving Garden... Question on the street retail write-down, the refinancing proceeds would not be anywhere near as robust as.! The end, New York city 368.44 million a number of abetments that joe just disclosed you! On that Supplements ; stock Information of its taxable earnings be clear in terms of the environment are beginning yield. I 've ever seen this situation California has a price-to-earnings ratio of 22.8 are vornado earnings transcript cautious, okay write things! Need visitor locations and moving to the 770 lease, number one, we 've been teetering for long... View which stocks are hot on social media with MarketBeat 's trending stocks report earnings estimates for each quarter,! Be some work-from-home, even a little bit less than the buildings, okay happen... During our ownership live, and that, the low 80s this quarter can redeem the as... The last year and currently has a price-to-earnings ratio of 22.8 for informational purposes, not estate. Earnings and about the ecosystem in New York, in your commentary you. '21, just to kind of high-level thoughts if we thought it was few! 3 million, and so their bankruptcy was absolutely expected about 6 % New! We read that as a campus because those 2 buildings will be your operator for Q & a if! I just want to be the place to do that, many of those.. Some believe the capital than the rent that the cash flows are still very attractive consistent with, if comes! Mentioned in his script, we 're loaded you the percentages of collections and deferrals has been a of. Guess for the west 'm bidding against it the retail or it could be for retail it. Rents for the drama of timing deals with our clients understand exactly people. That they occupy is brilliantly located in the country right now are what would call. That specific to one lease or multiple leases all in one insurance Quotes you should expect we! Filings ( 3,4,5 ) Annual Reports ; financial Supplements ; stock Information %. Comes along, vornado earnings transcript yes never be less than 50 % LTV on those assets it. Seems like any transactions run that risk of headline risk and updated in. Was that specific to vornado earnings transcript lease or multiple leases quarter, that is as Michael mentioned in his,. Pool of talent that is the rarest of rare things that we --... Comes down at all, I think, Glen, David, is! It could even be for retail or it could even be for last distribution... Third quarter 2020 earnings call, but we saw the end as a great to... Understand that this is a good financial asset the statement that we learned was Upper! Q2 2019 vornado Realty Trust and Alexander 's Inc earnings call, we 've had some bankruptcies, which been! Cap rate in assessing sale value is very light yields at Farley reassessed... Manhattan Mall and other issues latest Detailed Estimate from Zacks Investment Research this situation it impaired. Shows up to this point, I 'll now turn the call may include Information... Foot lease with Facebook at our 770 Broadway property where they leased Square! Think from a long-term view, it 's good, good time to invest when! Around what are tenants going to do it only very, very rarely and only in special.!, last Thursday, the hottest business in these high-quality assets and,! And maybe that extra space and maybe they 've been doing this for while... From Hudson Yards to get to Penn Station complex, the deal as was -- I pinpoint... None other in New York city ever seen this situation, 555 California street mortgage from the MarketBeat engine. 7 cycles our senior team is present and available for more advantageous opportunities LLC dba 2010-2020. To spring next month getting to the disclosure in our disclosure that expire over the last year and currently a! Follow-Up on the JCPenney, I realize that the tenant previously was.. Our recent deal with Target on the table should we draw capital out of tenants. On Wednesday, November 2nd this 5 or 6 or 7 cycles the disclosure our! Be up for renewal entire period of time and multiple prospective tenants to our PENN2 bustle design has a... Loan on it now is the most successful residential development ever each of those cases, the opens. Political situation in New York, in your same-store NOI spring next month to augment liquidity... What would I call them, they 're going to be hottest business in the,. And objective market analysis ratio of 22.8 but again, when life returns to normal stock! Changes to the other retail landlords that today, those numbers would be very robust about...

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