BMO Capital analyst John Kim maintained a Buy rating on SL Green Realty today and set a price target of $76.00.
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John Kim has given his Buy rating due to a combination of factors that highlight both positive leasing activity and challenges faced by SL Green Realty. Despite the underwhelming third-quarter results, the company demonstrated strong leasing activity, achieving a significant improvement in leased occupancy. This positive trend is evidenced by the substantial leasing at One Madison Avenue and the overall increase in Manhattan’s leased percentage.
However, there are notable challenges, such as the decline in cash same-store net operating income and cash leasing spreads, as well as the increased leverage due to recent acquisitions. Despite these negatives, the robust leasing pipeline and occupancy improvements suggest potential for future growth, justifying the Buy rating. John Kim acknowledges these mixed outcomes but sees the long-term potential in SL Green Realty’s strategic positioning in the NYC office market.
In another report released on October 13, Jefferies also upgraded the stock to a Buy with a $63.00 price target.