Author Topic: ESRT- Empire State Realty Trust  (Read 7350 times)

thepupil

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Re: ESRT- Empire State Realty Trust
« Reply #20 on: May 06, 2020, 11:46:03 AM »
So I wouldn't at all be surprised at that kind of drop in spot lease rates, which is why I am focusing on building and tenant quality/lease length. I think a drastic decline in spot rates and spike in vacancy is inevitable. it's whether or not we get to the heady pre-covid rates/occupancy in the out years (with the new supply) that will determine whether or not these are successful investments.

Lease length doesn't matter if the tenant goes away / default of course and I think that ESRT's tenants are incrementally more scary than the others as L&B highlights.

I think PGRE's 1633 Broadway and ALX's 731 is about as good as it gets in that regard VNO has more variability in both what you're paying and on how Penn shakes out, but VNO is more "west and south" than PGRE's midtown/Rock Center less "trendy" location.
 
i think L&B's characterization of ESRT is pretty high level and similar to my thoughts after 20 minutes of googling the building's ages and looking at the lower rent per foot, lower NOI margins, lower historical and current occupancy, etc of ESRT relative to others. I don't think it adds much analytical value to the discussion and one should give ESRT credit for re-developing its asset base. but I pretty much agree with him.

 If property taxes and operating costs go up while rents drop, the lowest margin guys will get hit the worst, right? With the lowest NOI margin and the observatory NOI juicing the aggregate, it just seems that ESRT's NOI is most at risk relative to the others. VNO/SLG have high street retail juicing their overall margins too, but it's not like that Observatory beast. only tourist (particularly international) go there and elevators packed with tourist going to the top of a very tall building comes after people going back to work in the covid recovery timeline (if such a thing exists).

I think it's tough to figure out where which type of tenants go (if they're switching between buildings in NYC) but would mostly guess that people either pay the same for higher quality or pay lower for the same quality. to make a stretched analysis, it's the marginal oil fields and pipelines that go away in an energy crisis and I characterize ESRT as having incrementally worse assets than the other public guys, but who knows.

But in the end, I'll restate that they are all different deck chairs on the titanic and have similar drivers.

one should aggregate them for risk management purposes.

When Bear Sterns went down, did Lehman shareholders say "see I knew it was them that would go down!" lol.
« Last Edit: May 06, 2020, 11:55:27 AM by thepupil »


Gregmal

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Re: ESRT- Empire State Realty Trust
« Reply #21 on: May 06, 2020, 11:55:42 AM »
i think L&B's characterization of ESRT is pretty high level and similar to my thoughts after 20 minutes of googling.

Depending on how you read this, this is either brilliant sarcasm or a brilliant and probably unintentional self tout.

thepupil

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Re: ESRT- Empire State Realty Trust
« Reply #22 on: May 06, 2020, 11:58:30 AM »
i think L&B's characterization of ESRT is pretty high level and similar to my thoughts after 20 minutes of googling.

Depending on how you read this, this is either brilliant sarcasm or a brilliant and probably unintentional self tout.

lol it is not self tout. why would I self tout when I've been pimping VNO since the $60's.

 it is simply saying that ESRT having 100 year old buildings is not unknown or deserving of a press release.

Give me a nice Ackman-esque 150 slide deck.

I think I need to make a youtube video of me crying and defending Steve Roth. that will help.
« Last Edit: May 06, 2020, 12:10:51 PM by thepupil »

thepupil

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Re: ESRT- Empire State Realty Trust
« Reply #23 on: May 19, 2020, 11:02:15 AM »
What do you all think of this?

ESRT just announced they made a 32/3 year old (Emory Undergrad 2009) their Chief Investment Officer

https://www.marketscreener.com/EMPIRE-STATE-REALTY-TRUST-14439062/news/Empire-State-Realty-Trust-Announces-Appointment-of-Aaron-Ratner-as-Senior-Vice-President-and-Chief-30636081/

I think it's pretty cool to hand the keys to a young gun, but it does seem highly unusual.

Is he by chance related to the Forest City Ratners?

Quote
New York, NY, May 19, 2020 - Empire State Realty Trust, Inc. (NYSE: ESRT) (the 'Company'), a real estate investment trust with office and retail properties in Manhattan and the greater New York metropolitan area, today announced the appointment of Aaron Ratner as Senior Vice President and Chief Investment Officer, effective May 26, 2020. In this newly created role, Mr. Ratner will lead the Company's investment strategies and sourcing of external growth opportunities.

Anthony E. Malkin, Chairman and Chief Executive Officer of ESRT said, 'Aaron's appointment follows our comments in our Q1 earnings call. I am confident he is the right person to create opportunities for us in this cycle and those to come, and we welcome him to our team.'

'Empire State Realty Trust is a platform poised for accretive growth,' said Mr. Ratner. 'I am honored and motivated by the opportunity to work with ESRT's talented team and to create value for ESRT's shareholders.'

Mr. Ratner joins ESRT after nine-years with TPG. He most recently served as a principal on the real estate team, where he developed investment strategies, sourced opportunities, and executed and managed real estate debt and equity investments. He served on the Board of Directors and Finance Committee for AV Homes (NASDAQ: AVHI). Before TPG, he worked in the real estate investment banking group at Eastdil Secured. Mr. Ratner earned a B.B.A in Finance with distinction from Emory University's Goizueta Business School.

About Empire State Realty Trust Empire State Realty Trust, Inc. (NYSE: ESRT), a leading real estate investment trust (REIT), owns, manages, operates, acquires and repositions office and retail properties in Manhattan and the greater New York metropolitan area, including the Empire State Building, the world's most famous building. Headquartered in New York, New York, the Company's office and retail portfolio covers 10.1 million rentable square feet, as of March 31, 2020, consisting of 9.4 million rentable square feet in 14 office properties, including nine in Manhattan, three in Fairfield County, Connecticut and two in Westchester County, New York; and approximately 700,000 rentable square feet in the retail portfolio.
« Last Edit: May 19, 2020, 11:14:20 AM by thepupil »

johnny

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Re: ESRT- Empire State Realty Trust
« Reply #24 on: May 19, 2020, 11:11:08 AM »
For those of you afraid of getting networking inmails from LinkedIn stalking, nothing left out of the press release:

thepupil

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Re: ESRT- Empire State Realty Trust
« Reply #25 on: May 19, 2020, 11:27:16 AM »
as an additional fun fact, AV Homes used to be called Avatar Holdings; they changed their name not long after the movie Avatar came out. Avatar was a nice little post GFC value trap where it traded at like 20-30 points of unlevered book and that was too high a price because it mostly owned marginal land in god forsaken parts of central florida and Arizona.

https://www.globenewswire.com/news-release/2012/02/15/468145/246013/en/Avatar-Holdings-Inc-Becomes-AV-Homes-Inc.html

Here's a February 2010 VIC pitch @ $17 and change; I pitched it as a long in an interview with the one the only vampire squid and the guy didn't like it one bit; no second interview was rewarded, no Goldman Sachs Principal Strategies job for me.

So if you all thought that me being a little early to a real estate recovery trade was a new thing, I've been doing this since college lol! with hopefully better assets than lots in Poinciana, Florida.

https://valueinvestorsclub.com/idea/AVATAR_HOLDINGS_INC/0684703277

Thereafter went as low as $6 in 2011, and got taken out by Taylor Morrison 2018 for about $20.

TPG bought in 2014 for $14 and change, not exactly a crazy good (or bad) investment on the surface, maybe they made a little more than it looks like because of the converts/prefs.
https://www.globenewswire.com/news-release/2013/06/19/555135/10036881/en/AV-Homes-Inc-Announces-135-Million-Equity-Investment-by-TPG.html


« Last Edit: May 19, 2020, 11:38:18 AM by thepupil »

Gregmal

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Re: ESRT- Empire State Realty Trust
« Reply #26 on: May 19, 2020, 11:35:58 AM »
I'd like to see his compensation structure. Giving a young, motivated fella the reigns is more appealing to me than some grey haired industry vet still living in the 90's.


rb

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Re: ESRT- Empire State Realty Trust
« Reply #27 on: May 19, 2020, 11:39:14 AM »

Is he by chance related to the Forest City Ratners?

My first thought was who's nephew is this. But then if he is a Forest City Ratner and the best school they managed to get him in was Emory then I would stay the hell away from the stock.

fareastwarriors

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Re: ESRT- Empire State Realty Trust
« Reply #28 on: May 19, 2020, 11:57:11 AM »

Is he by chance related to the Forest City Ratners?

My first thought was who's nephew is this. But then if he is a Forest City Ratner and the best school they managed to get him in was Emory then I would stay the hell away from the stock.

lol! ouch

Gregmal

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Re: ESRT- Empire State Realty Trust
« Reply #29 on: May 19, 2020, 12:15:49 PM »
Yea NYC RE circles can be very incestuous.