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Empire State Realty
(NYSE:ESRT)
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Rating:59Neutral
Price Target:
$6.00
â–¼(-17.24% Downside)
Action:Reiterated
Date:05/20/26
The score is driven primarily by solid operating cash generation and a generally positive operating update on the earnings call (leasing execution, improved FAD/CapEx, and extended debt maturities). These positives are tempered by high leverage and uneven gross profitability, while technicals are neutral and valuation is a meaningful drag due to the very high P/E despite a modest dividend yield.
Positive Factors
High occupancy & durable leasing
Sustained ~93% leasing, long average office lease terms (~10.5 years; portfolio avg 12.2 years) and a 280k sq ft pipeline materially reduce vacancy risk. Nineteen quarters of positive Manhattan mark‑to‑market spreads show persistent pricing power supporting durable rental revenue and renewal economics.
Negative Factors
High leverage
Leverage levels remain elevated, constraining balance sheet flexibility and increasing sensitivity to interest rates or EBITDA shocks. High net debt relative to earnings means weaker capacity to fund vacancies or reinvest without additional external financing, and it compresses returns to equity holders over time.
Read all positive and negative factors
Positive Factors
Negative Factors
High occupancy & durable leasing
Sustained ~93% leasing, long average office lease terms (~10.5 years; portfolio avg 12.2 years) and a 280k sq ft pipeline materially reduce vacancy risk. Nineteen quarters of positive Manhattan mark‑to‑market spreads show persistent pricing power supporting durable rental revenue and renewal economics.
Read all positive factors
Empire State Realty Key Performance Indicators (KPIs)
Any
Office & Retail Total Rentable Square Footage
Total rentable square feet in the office and retail portfolio, conveying the company’s operating scale and exposure to commercial real estate trends. Useful for assessing concentration risks, revenue per square foot, and the magnitude of leasing or renovation needs when market conditions shift.
Total rentable square feet in the office and retail portfolio, conveying the company’s operating scale and exposure to commercial real estate trends. Useful for assessing concentration risks, revenue per square foot, and the magnitude of leasing or renovation needs when market conditions shift.
Data provided by:
The Fly
The FlyEmpire State Realty (ESRT) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$950.09M
Dividend Yield2.16%
Average Volume (3M)1.73M
Price to Earnings (P/E)25.5
Beta (1Y)0.96
Revenue Growth1.53%
EPS Growth-31.93%
CountryUS
Employees667
SectorReal Estate
Sector Strength53
IndustryREIT - Diversified
Share Statistics
EPS (TTM)0.22
Shares Outstanding171,460,310
10 Day Avg. Volume2,027,511
30 Day Avg. Volume1,731,871
Financial Highlights & Ratios
PEG Ratio-2.42
Price to Book (P/B)1.04
Price to Sales (P/S)1.43
P/FCF Ratio21.74
Enterprise Value/Market Cap3.33
Enterprise Value/Revenue4.06
Enterprise Value/Gross Profit-39.28
Enterprise Value/Ebitda8.71
Forecast
1Y Price Target
$6.25Price Target Upside-13.79% Downside
Rating ConsensusModerate Buy
Number of Analyst Covering3
EPS Forecast (FY)N/A
Revenue Forecast (FY)$774.79M
Empire State Realty Business Overview & Revenue Model
Company Description
Empire State Realty Trust, Inc. (NYSE: ESRT) functions as a leading real estate investment trust (REIT), focused on the acquisition, ownership, management, operation, and revitalization of commercial office and retail assets across Manhattan and t...
How the Company Makes Money
ESRT primarily makes money through recurring real estate rental income and, secondarily, through observatory-related revenues. The company’s key revenue streams include: (1) Office and retail leasing revenue: ESRT leases office space and retail sp...
Empire State Realty Earnings Call Summary
Earnings Call Date:Apr 29, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Jul 29, 2026
Earnings Call Sentiment Positive
The call highlights strong leasing momentum, high portfolio occupancy, meaningful rent growth and mark-to-market gains in Manhattan, improved cash flow metrics, successful capital recycling into a strategic retail position, and proactive financing that extends maturities and preserves liquidity. Lowlights were concentrated in the seasonally weak first-quarter performance of the Observatory (notably lower international visitation and a ~$3.5M YoY NOI decline excluding gift shop), some operating expense growth, reliance on a few large lease-ups which creates lumpy occupancy dynamics, and broader macro/tourism uncertainty. On balance, operational strength, balance sheet flexibility, and demonstrated leasing execution materially outweigh the headwinds reported.Positive Updates
High Occupancy and Robust Leasing Activity
Commercial portfolio ~93% leased (93.2% reported); thirteenth consecutive quarter above 90%. Signed 113,000 sq ft of new and renewal leases in Q1; leasing pipeline increased to ~280,000 sq ft (from 170,000 sq ft). Average lease term for office transactions ~10.5 years; average lease duration 12.2 years.19th consecutive quarter of positive mark-to-market rent spreads in Manhattan with a 6.8% mark-to-market spread.
Negative Updates
Observatory Visitation Softness and Revenue Impact
Visitation and tourist demand were soft in Q1 (management noted international visitation remains weak). Analysts referenced visitation down ~18% in Q1; Observatory NOI excluding the gift shop declined by approximately $3.5 million year-over-year. Gift shop license amendment shifts revenue weighting to Q4 and reduced fixed payments in earlier quarters.
Read all updates
Q1-2026 Updates
Positive
Negative
High Occupancy and Robust Leasing Activity
Commercial portfolio ~93% leased (93.2% reported); thirteenth consecutive quarter above 90%. Signed 113,000 sq ft of new and renewal leases in Q1; leasing pipeline increased to ~280,000 sq ft (from 170,000 sq ft). Average lease term for office transactions ~10.5 years; average lease duration 12.2 years.19th consecutive quarter of positive mark-to-market rent spreads in Manhattan with a 6.8% mark-to-market spread.
Read all positive updates
Company Guidance
Management reiterated unchanged full‑year 2026 guidance and remains confident in year‑end office occupancy of 90%–92%; the portfolio started the year ~93.6% leased and is currently ~93%–93.2% leased with ~210,000 sq ft of known vacates to be covered by a healthy 280,000‑sq‑ft leasing pipeline (up from 170,000), having signed 113,000 sq ft in Q1; office leases this quarter averaged over 10.5 years with a commercial portfolio average lease duration of 12.2 years and Manhattan mark‑to‑market spreads of 6.8% (19th consecutive quarter positive). Key operating and financial metrics include Q1 core FFO of $0.20 per share, same‑store property cash NOI +5.5% YoY (or +1.3% ex‑nonrecurring items), Q1 Observatory NOI $10.6M (revenue per capita +1% ex‑gift shop, visitation down ~18% in Q1), core FAD ≈ $33M (vs. $1M in Q1‑2025), FAD CapEx ≈ $22M (vs. $53M), multifamily same‑store NOI +9% with net rents +6% and occupancy improving from 96.4% to over 98% leased, and a fortified balance sheet after $184M of financings YTD (including $130M senior notes at 5.99% maturing 2032 and a $53.5M 10‑yr IO mortgage at 5.3%), leaving no unaddressed debt maturities until Jan 2028 and net debt/adjusted EBITDA of 6.3x; management also cited capital recycling activity (e.g., $46M purchase of 4155 North 6th St, bringing the North 6th portfolio to 124,000 sq ft) as part of growth plans.Empire State Realty Financial Statement Overview
Summary
Income Statement
63
Positive
Balance Sheet
44
Neutral
Cash Flow
71
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 778.07M | 768.27M | 763.15M | 739.57M | 707.01M | 607.86M |
| Gross Profit | -80.45M | 13.73M | 408.99M | 400.56M | 385.65M | 328.38M |
| EBITDA | 362.85M | 374.08M | 377.57M | 378.52M | 382.86M | 281.43M |
| Net Income | 39.62M | 47.60M | 51.64M | 53.24M | 40.64M | -6.51M |
Balance Sheet | ||||||
| Total Assets | 4.41B | 4.47B | 4.51B | 4.22B | 4.16B | 4.28B |
| Cash, Cash Equivalents and Short-Term Investments | 68.82M | 166.51M | 385.46M | 346.62M | 264.43M | 423.69M |
| Total Debt | 2.35B | 2.44B | 2.48B | 2.27B | 2.27B | 2.34B |
| Total Liabilities | 2.58B | 2.65B | 2.73B | 2.49B | 2.48B | 2.60B |
| Stockholders Equity | 1.06B | 1.06B | 1.03B | 985.52M | 954.38M | 998.13M |
Cash Flow | ||||||
| Free Cash Flow | 60.20M | 50.55M | 260.89M | 232.49M | 84.91M | 117.45M |
| Operating Cash Flow | 234.82M | 249.05M | 260.89M | 232.49M | 211.17M | 212.49M |
| Investing Cash Flow | -743.11M | -550.01M | -397.12M | -77.34M | -230.89M | -212.74M |
| Financing Cash Flow | 206.53M | 38.17M | 158.58M | -62.87M | -140.24M | -93.05M |
Empire State Realty Technical Analysis
Positive
7.25
Price Trends
5.45
Positive
5.48
Positive
6.21
Negative
Market Momentum
-0.03
Negative
55.78
Neutral
82.82
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ESRT, the sentiment is Positive. The current price of 7.25 is above the 20-day moving average (MA) of 5.32, above the 50-day MA of 5.45, and above the 200-day MA of 6.21, indicating a neutral trend. The MACD of -0.03 indicates Negative momentum. The RSI at 55.78 is Neutral, neither overbought nor oversold. The STOCH value of 82.82 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ESRT.
Empire State Realty Risk Analysis
Empire State Realty disclosed 59 risk factors in its most recent earnings report. Empire State Realty reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Empire State Realty Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
66 Neutral | $541.56M | 21.77 | 8.11% | 9.03% | 10.12% | -7.92% | |
65 Neutral | $2.17B | 12.19 | 3.79% | 4.94% | 3.15% | 1.96% | |
62 Neutral | $606.31M | 27.48 | 9.74% | 11.56% | 9.64% | -38.93% | |
59 Neutral | $950.09M | 25.52 | 3.77% | 2.16% | 1.53% | -31.93% | |
59 Neutral | $1.55B | 85.03 | 1.93% | 7.31% | -12.40% | -77.27% | |
51 Neutral | $1.89B | -22.90 | -2.44% | 10.29% | -35.44% | 50.75% |
* Real Estate Sector Average
ESRT
Empire State Realty
5.51
-2.58
-31.92%
GOOD
Gladstone Commercial
12.43
-0.76
-5.76%
OLP
One Liberty Properties
24.82
2.48
11.09%
AAT
American Assets
25.22
6.32
33.43%
GNL
Global Net Lease
8.93
1.89
26.90%
Empire State Realty Corporate Events
Business Operations and StrategyShareholder Meetings
Empire State Realty Shareholders Back Governance and Incentive Plan
Positive
May 19, 2026
At its annual shareholders meeting held on May 14, 2026, Empire State Realty Trust, Inc. reported that holders of its Class A and Class B common stock voted together to elect all nominated directors and endorsed, on an advisory basis, the compensa...
Business Operations and StrategyFinancial DisclosuresM&A TransactionsPrivate Placements and Financing
Empire State Realty Reports Solid Q1 Results, Reaffirms Outlook
Positive
Apr 29, 2026
On April 29, 2026, Empire State Realty Trust reported first-quarter 2026 net income of $0.01 per fully diluted share and Core FFO of $0.20, with same-store cash NOI up 5.5% year over year, or 1.3% excluding non-recurring items. The commercial port...
Business Operations and StrategyPrivate Placements and Financing
Empire State Realty Announces New Senior Notes Financing
Positive
Apr 15, 2026
On April 15, 2026, Empire State Realty Trust, Inc. and its operating partnership subsidiary Empire State Realty OP, L.P. entered into a Note Purchase Agreement for a private placement of $130 million of 5.99% Series M Senior Notes due July 15, 203...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.