VNO - Embedded Expectations Analysis - 2018 09 19
Vornado Realty Trust (VNO:USA) currently trades near historical lows relative to Uniform Assets, with a 1.6x Uniform P/B. However, even at these levels, markets are pricing in bullish expectations for the firm, while management is concerned about their ability to take advantage of distressed retail properties, stagnant growth, and sustaining elevated absorption ratesSpecifically, management may lack confidence in their ability to become an aggressive acquirer of distressed retail properties, and may be exaggerating their optimism about spreads going forward. Additionally, they may lack confidence in the sustainability of robust absorption rates throughout New York City, and rent growth in the West Chelsea market. Furthermore, they may be concerned about stagnant growth in the West Side market in New York City and about tightening in the midtown market. Moreover, they may lack confidence in their ability to sustain strong office occupancy rates, and may be concerned about their recent lease with New York University. Finally, they may lack confidence in their ability to maintain high lease rates in theMART in Chicago
Vornado Realty Trust is a real estate investment trust and conducts its business through, and substantially all of its interests in properties are held by, Vornado Realty L.P. (the Operating Partnership). The company is the sole general partner of the Operating Partnership. The company owns and operates office and retail properties with a concentration in the New York City metropolitan area. In addition, the company has interest in Alexander's, Inc., which owns properties in the New York metropolitan area, as well as interests in other real estate and related investments.
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