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Dec 31, 2022
Vornado Q4 2022 Earnings Report
Vornado's financial performance was marked by a net loss, offset by gains in FFO and strategic dispositions.
Key Takeaways
Vornado Realty Trust reported a net loss attributable to common shareholders of $493.3 million, or $2.57 per diluted share, for Q4 2022. However, adjusted non-GAAP net income was $19.9 million, or $0.10 per diluted share. FFO attributable to common shareholders plus assumed conversions was $176.5 million, or $0.91 per diluted share, while adjusted non-GAAP FFO was $139.0 million, or $0.72 per diluted share.
Net loss attributable to common shareholders was $493.3 million, or $2.57 per diluted share.
Adjusted non-GAAP net income was $19.9 million, or $0.10 per diluted share.
FFO attributable to common shareholders plus assumed conversions was $176.5 million, or $0.91 per diluted share.
Adjusted non-GAAP FFO was $139.0 million, or $0.72 per diluted share.
Vornado
Vornado
Forward Guidance
Vornado is actively managing its portfolio, as evidenced by the 350 Park Avenue deal and continued development projects. However, the ground rent reset at PENN 1 and general market volatility pose risks.
Positive Outlook
- Citadel master leasing 350 Park Avenue for 10 years at $36 million annual net rent.
- Joint venture with Rudin to purchase 39 East 51st Street for $40 million.
- Potential for KG to acquire a 60% interest in a joint venture to develop a new office tower.
- Citadel or its affiliates will execute a pre-negotiated 15-year anchor lease for approximately 850,000 square feet at the Project.
- Vornado/Rudin has the option to put the Site to KG for $1.2 billion.
Challenges Ahead
- The 13.2% projected return for PENN 1 is before the ground rent reset in 2023, which may be material.
- There can be no assurance that the projects will be completed, completed on schedule or within budget.
- There can be no assurance that the Company will be successful in leasing the properties on the expected schedule or at the assumed rental rates.
- Increase in interest rates and inflation.
- Continuing effect of the COVID-19 pandemic on our business.