Empire State Realty Trust Completes Transition to 100% NYC Portfolio

Empire State Realty Trust has officially become a pure-play New York City landlord after selling its final suburban property, completing a multi-year transformation that saw the REIT shed 1.8 million square feet of Connecticut office and retail assets while pouring over $1 billion into Manhattan acquisitions.

The company reported Q4 2025 results showing total portfolio occupancy of 90.3% — up 170 basis points year-over-year — with its office portfolio maintaining 93.5% occupancy for the 12th consecutive quarter above 90%.

Suburban Exit, City Bet

ESRT's suburban exit included transferring or selling six properties in Norwalk, Stamford, and Westport, Connecticut between 2022 and 2025. The final disposition — Metro Center in Stamford — sold in Q4 2025 in the mid-$60 million range to HB Nitkin, roughly matching the outstanding debt balance.

The proceeds were redirected to Manhattan. ESRT's crown jewel acquisition was 130 Mercer Street (555-557 Broadway) in SoHo, purchased for $386 million in December 2025. The Scholastic headquarters building is currently 70% occupied with an initial cash yield in the mid-5% range and expected stabilized yield around 8%.

ESRT's current portfolio spans 7.6 million square feet of office, 800,000 square feet of retail, and 743 residential units — all within New York City.

Empire State Building Leasing Surge

The company's flagship asset continues to attract blue-chip tenants. LinkedIn signed a 16-year, 15,000-square-foot retail lease at the Empire State Building, expanding its total footprint in the tower to roughly 540,000 square feet. Nespresso renewed 42,000 square feet of office space at nearby 111 West 33rd Street for seven years, while TJ Maxx signed a 10-year renewal for 46,000 square feet of retail at 250 West 57th Street.

Burlington Stores made the biggest move, expanding to 206,000 square feet at 1400 Broadway with a 16-year lease — its fourth expansion since taking an initial 35,000-square-foot space in 2010.

In total, ESRT signed over 1 million square feet of leases in 2025, with positive mark-to-market lease spreads of 6.4%.

Financial Results

ESRT reported Q4 core FFO of $0.23 per diluted share on revenues of $199.2 million. Net income nearly doubled year-over-year to $19.7 million. The company's Observatory business generated $90.1 million in full-year NOI, with revenue per capita increasing 4.4%.

Looking ahead, ESRT guided 2026 core FFO of $0.85 to $0.89 per share and has over 170,000 square feet of leases in its pipeline expected to close in the first half of the year.

"Transaction activity has increased, and there is strong institutional capital interest in New York City," said President Christina Chiu.