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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.
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.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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