John Kessler, president and COO of Empire State Realty Trust (NYSE: ESRT), joined REIT.com for a video interview at REITWeek 2016: NAREIT’s Investor Forum at the Waldorf Astoria New York.
Empire State owns and operates office and retail properties in Manhattan and the greater New York metropolitan area, including the Empire State Building.
Kessler noted that the portfolio is currently about 90 percent leased, and stressed the value component that Empire State properties offer, given their central locations and high level of maintenance.
“Given the value we are offering, we feel very good about where we compete in the marketplace,” Kessler said.
Kessler noted that the company had a particularly strong first quarter in terms of funds from operations (FFO). Empire State leased more than 250,000 square feet during the quarter, and posted solid results from the Observatory at the Empire State Building, he said.
Looking to the remainder of the year, Kessler said the big challenge will be continuing to execute the strategic plan, which involves staying focused on the redevelopment of assets and marking spaces to market.
Kessler noted that trailing 12-month net operating income (NOI) in the portfolio is about $330 million to $335 million. Between executing on signed leases not commenced, and marking to market office and retail spaces, “we think we can generate more than $100 million of incremental NOI growth against that base,” Kessler said.