SL Green Raises 2026 FFO Guidance Despite Rate Drag on Office Sales

SL Green Realty, Manhattan’s largest office landlord, raised its full-year 2026 funds from operations guidance to $6.50 to $6.70 a share, up from $5.60 to $5.90, after a third quarter that beat the same period last year. The increase came almost entirely from a one-time hospitality deal, not from the office portfolio the company is in the middle of shrinking.

Why it matters

The real estate investment trust reported Q3 2026 FFO of $1.59 per share, up a cent from $1.58 a year earlier, and raised 2026 net income guidance to $0.40 to $0.60 per share from $0.20 to $0.50, according to the company’s own earnings release filed with the SEC. The gain traces to $1.10 per share of incremental income from selling a 20 percent joint venture interest in SL Green’s food and beverage hospitality operations, a roughly $200 million transaction. That was partly offset by $0.25 per share attributable to the higher interest rate environment, the same backdrop working against the $2.5 billion in Manhattan office and residential dispositions President Harrison Sitomer has been executing since the plan surfaced in December 2025. Chairman and CEO Marc Holliday hosted the October 22 call presenting the results.

The numbers

Nine Manhattan properties went on the block as part of the $2.5 billion plan, including 1350 Sixth Avenue, a 25 percent stake in 245 Park Avenue, and a 65 percent stake in 750 Third Avenue. SL Green has since put 10 East 53rd Street under contract to Meadow Partners for $312.2 million, expected to close in the third quarter of 2026 with roughly $100 million in net proceeds earmarked for corporate debt repayment. The company also signed contracts to sell 110 Greene Street for $226.0 million, closing in the fourth quarter, and the residential and retail components of 7 Dey Street for $222.6 million. As of the prior quarter’s call, SL Green was not yet halfway to the full $2.5 billion target.

What’s next

The remaining assets, including the 245 Park Avenue and 750 Third Avenue stakes, sit against a refinancing backdrop where SL Green’s own 245 Park debt carries a 6.52 percent rate before hedging. Every quarter the disposition plan runs behind schedule is another quarter of carrying that financing cost, which is exactly the drag the Q3 guidance update flagged. For the broader New York office market, SL Green’s pace on the remaining stakes is one of the clearest signals of how much appetite still exists for large Manhattan office positions at a moment when debt costs, not leasing, are the swing factor in landlord earnings.