Financial and Operating Highlights
- Net income attributable to common stockholders of
$0.20 per share for the first quarter of 2024 as compared to net loss of$0.63 per share for the same period in 2023. - Funds from operations, or FFO, of
$3.07 per share for the first quarter of 2024, inclusive of$141.7 million , or$2.02 per share, of gain on discounted debt extinguishment at2 Herald Square and$5.1 million , or$0.07 per share, of positive non-cash fair value adjustments on a mark-to-market derivative. The Company reported FFO of$1.53 per share for the same period in 2023. - The Company is increasing its 2024 FFO guidance range for the year ending
December 31, 2024 to FFO per share of$7.35 to$7.65 , an increase of$1.45 per share at the midpoint, primarily to reflect gains on discounted debt extinguishments at2 Herald Square as well as at280 Park Avenue and719 Seventh Avenue , as announced today, while maintaining its 2024 net income guidance range of$2.73 to$3.03 per share. - Signed 60 Manhattan office leases covering 633,660 square feet in the first quarter of 2024. The mark-to-market on signed
Manhattan office leases was 5.5% lower for the first quarter than the previous fully escalated rents on the same spaces. - Same-store cash net operating income, or NOI, including the Company's share of same-store cash NOI from unconsolidated joint ventures, decreased by 1.2% for the first quarter of 2024, as compared to the same periods in 2023, excluding lease termination income.
Manhattan same-store office occupancy was 89.2% as ofMarch 31, 2024 , thirty basis points better than the Company's projections, inclusive of leases signed but not yet commenced. The Company expects to increaseManhattan same-store office occupancy, inclusive of leases signed but not yet commenced, to more than 91.5% byDecember 31, 2024 .
Investing Highlights
- Entered into a contract to acquire our partner's 45% interest in
10 East 53rd Street for cash consideration of$7 .2 million net of all outstanding debt obligations. The acquisition is expected to close in the fourth quarter of 2024. - Entered into a contract to sell the
Palisades Premier Conference Center for$26 .3 million. The Company took control of the property inJuly 2023 in partial satisfaction of a legal judgement it received against an affiliate of HNA. The sale is expected to close in the second quarter of 2024 and generate net proceeds of$20 .0 million. - Together with our joint venture partner, closed on the sale of the retail condominium at
717 Fifth Avenue for total consideration of$963 .0 million. The transaction generated net proceeds to the Company of$27 .0 million, which was used for corporate debt repayment. - Acquired equity interests in the joint venture that owns the leasehold at
2 Herald Square for no consideration, increasing the Company's interest in the joint venture to 95%. In addition, the previous$182 .5 million mortgage on the property was repaid for a net payment of$7 .0 million. - The Company launched fundraising for its
$1 .0 billion opportunistic debt fund. This fund will allow the Company to capitalize on current capital markets dislocations through the discounted acquisition of existing debt investments and origination of new, high-yielding debt instruments.
Financing Highlights
- Together with our joint venture partner, closed on a modification and extension of the
$360 .0 million mortgage on100 Park Avenue . The modification extended the maturity date by two years toDecember 2025 , as fully extended, and the interest rate was maintained at 2.36% over Term SOFR. - Together with our joint venture partner, closed on a modification and extension of the mortgage on
10 East 53rd Street , which included a paydown of the principal balance by$15 .0 million to$205 .0 million. The modification extended the maturity date by three years toMay 2028 , as fully extended, and the interest rate was maintained at 1.45% over Term SOFR, which the joint venture fixed at 5.36% fromMay 2025 toMay 2028 . - Together with our joint venture partner, closed on a modification and extension of the mortgage on
15 Beekman Street . The modification included a paydown of the principal balance by$4 .6 million to$120 .0 million, extended the mortgage by four years toJanuary 2028 , as fully extended, and the interest rate was maintained at 1.50% over Term SOFR, which the joint venture fixed at 5.99% throughJanuary 2026 .
ESG Highlights
- Received ENERGY STAR Partner of the Year Sustained Excellence Award in 2024, the highest level of
U.S. Environmental Protection Agency (EPA) recognition, for the seventh consecutive year. Among thousands of ENERGY STAR partners, the Company was one of just 160 organizations to achieve the Sustained Excellence distinction. - Featured on the Sustainalytics 2024 ESG Top-Rated Companies List for the second consecutive year and winner of the 2024
Sustainalytics Regional Award, ranking the Company in the Top 10% for ESG Risk Rating inthe United States andCanada region, which covers nearly 16,000 companies. - Recognized as a 2024 S&P Global Sustainability Yearbook Member for scoring within the top 15% of its industry in the S&P Corporate Sustainability Assessment (CSA). Out of the 9,200+ companies assessed in 2023, only 733 are recognized.
The Company reported FFO for the quarter ended
All per share amounts are presented on a diluted basis.
Operating and Leasing Activity
Same-store cash NOI, including our share of same-store cash NOI from unconsolidated joint ventures, increased by 1.2% for the first quarter of 2024, and decreased 1.2% excluding lease termination income, better than the Company's projections, as compared to the same period in 2023.
During the first quarter of 2024, the Company signed 60 office leases in its
Occupancy in the Company's
Significant leasing activity in the first quarter includes:
- Early renewal and expansion for a total of 75,950 square feet with
Antares Capital L.P. at280 Park Avenue ; - New leases of 67,208 square feet and 35,898 square feet with a publicly traded financial services firm and a subsidiary of
Flutter Entertainment , respectively, atOne Madison Avenue ; - New lease with
OCC Strategy Consultants for 28,182 square feet at1185 Avenue of the Americas ; - Five new leases and one early renewal for a total of 67,424 square feet at
485 Lexington Avenue ; - Early renewal with Hinshaw & Colbertson for 26,977 square feet at
800 Third Avenue ; - Expansion lease with
McDermott Will & Emery LLP for 22,944 square feet atOne Vanderbilt Avenue ; - Early renewal with
H Work LLC for 22,873 square feet at100 Church Street ; and - Early renewal and expansion with
IM Pro Makeup NY LP for a total of 19,898 square feet at110 Greene Street .
Investment Activity
In March, the Company entered into a contract to acquire its partner's 45% interest in
In March, the Company entered into a contract to sell the
In January, together with our joint venture partner, the Company closed on the sale of the retail condominium at
In January, the Company acquired equity interests in the joint venture that owns the leasehold at
The Company launched fundraising for its
Debt and Preferred Equity Investment Activity
The carrying value of the Company’s debt and preferred equity ("DPE") portfolio was
Financing Activity
In March, together with our joint venture partner, closed on a modification and extension of the mortgage on
In March, together with our joint venture partner, closed on a modification and extension of the
In March, together with our joint venture partner, closed on a modification and extension of the mortgage on
Earnings Guidance
The Company is increasing its 2024 FFO guidance range for the year ending
ESG
The Company received ENERGY STAR Partner of the Year Sustained Excellence Award in 2024, the highest level of
The Company was featured on the Sustainalytics 2024 ESG Top-Rated Companies List for the second consecutive year and winner of the 2024
The Company was recognized as a 2024 S&P Global Sustainability Yearbook Member for scoring within the top 15% of its industry in the S&P Corporate Sustainability Assessment (CSA). Out of the 9,200+ companies assessed in 2023, only 733 are recognized.
Dividends
In the first quarter of 2024, the Company declared:
- Three monthly ordinary dividends on its outstanding common stock of
$0.25 per share, which were paid in cash onFebruary 15 ,March 15 , andApril 15, 2024 , equating to an annualized dividend of$3.00 per share of common stock; and - A quarterly dividend on its outstanding 6.50% Series I Cumulative Redeemable Preferred Stock of
$0.40625 per share for the periodJanuary 15, 2024 through and includingApril 14, 2024 , which was paid in cash onApril 15, 2024 and is the equivalent of an annualized dividend of$1.625 per share.
Conference Call and Audio Webcast
The Company's executive management team, led by
Supplemental data will be available prior to the quarterly conference call in the Investors section of the
The live conference call will be webcast in listen-only mode and a replay will be available in the Investors section of the
Research analysts who wish to participate in the conference call must first register at https://register.vevent.com/register/BI8ffaf79b5a20457a84e0499c12eb8086.
Company Profile
To obtain the latest news releases and other Company information, please visit our website at www.slgreen.com or contact Investor Relations at investor.relations@slgreen.com.
Disclaimers
Non-GAAP Financial Measures
During the quarterly conference call, the Company may discuss non-GAAP financial measures as defined by SEC Regulation G. In addition, the Company has used non-GAAP financial measures in this press release. A reconciliation of each non-GAAP financial measure and the comparable GAAP financial measure can be found in this release and in the Company’s Supplemental Package.
Forward-looking Statements
This press release includes certain statements that may be deemed to be "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and are intended to be covered by the safe harbor provisions thereof. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that we expect, believe or anticipate will or may occur in the future, including such matters as future capital expenditures, dividends and acquisitions (including the amount and nature thereof), development trends of the real estate industry and the
Forward-looking statements contained in this press release are subject to a number of risks and uncertainties, many of which are beyond our control, that may cause our actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by forward-looking statements made by us. Factors and risks to our business that could cause actual results to differ from those contained in the forward-looking statements include risks and uncertainties described in our filings with the
PRESS CONTACT
slgreen@berlinrosen.com
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited and in thousands, except per share data)
Three Months Ended | |||||||
Revenues: | 2024 | 2023 | |||||
Rental revenue, net | $ | 128,203 | $ | 174,592 | |||
Escalation and reimbursement revenues | 13,301 | 20,450 | |||||
SUMMIT Operator revenue | 25,604 | 19,771 | |||||
Investment income | 7,403 | 9,057 | |||||
Other income | 13,371 | 21,894 | |||||
Total revenues | 187,882 | 245,764 | |||||
Expenses: | |||||||
Operating expenses, including related party expenses of | 43,608 | 52,064 | |||||
Real estate taxes | 31,606 | 41,383 | |||||
Operating lease rent | 6,405 | 6,301 | |||||
SUMMIT Operator expenses | 21,858 | 20,688 | |||||
Interest expense, net of interest income | 31,173 | 41,653 | |||||
Amortization of deferred financing costs | 1,539 | 2,021 | |||||
SUMMIT Operator tax expense | (1,295 | ) | 1,267 | ||||
Depreciation and amortization | 48,584 | 78,782 | |||||
Loan loss and other investment reserves, net of recoveries | — | 6,890 | |||||
Transaction related costs | 16 | 884 | |||||
Marketing, general and administrative | 21,313 | 23,285 | |||||
Total expenses | 204,807 | 275,218 | |||||
Equity in net income (loss) from unconsolidated joint ventures | 111,160 | (7,412 | ) | ||||
Equity in net gain (loss) on sale of interest in unconsolidated joint venture/real estate | 26,764 | (79 | ) | ||||
Purchase price and other fair value adjustments | (50,492 | ) | 239 | ||||
Loss on sale of real estate, net | — | (1,651 | ) | ||||
Depreciable real estate reserves | (52,118 | ) | — | ||||
Net income (loss) | 18,389 | (38,357 | ) | ||||
Net loss attributable to noncontrolling interests: | |||||||
Noncontrolling interests in the | (901 | ) | 2,337 | ||||
Noncontrolling interests in other partnerships | 1,294 | 1,625 | |||||
Preferred units distributions | (1,903 | ) | (1,598 | ) | |||
Net income (loss) attributable to SL Green | 16,879 | (35,993 | ) | ||||
Perpetual preferred stock dividends | (3,738 | ) | (3,738 | ) | |||
Net income (loss) attributable to SL Green common stockholders | $ | 13,141 | $ | (39,731 | ) | ||
Earnings Per Share (EPS) | |||||||
Basic earnings (loss) per share | $ | 0.20 | $ | (0.63 | ) | ||
Diluted earnings (loss) per share | $ | 0.20 | $ | (0.63 | ) | ||
Funds From Operations (FFO) | |||||||
Basic FFO per share | $ | 3.11 | $ | 1.54 | |||
Diluted FFO per share | $ | 3.07 | $ | 1.53 | |||
Basic ownership interest | |||||||
Weighted average REIT common shares for net income per share | 64,328 | 64,079 | |||||
Weighted average partnership units held by noncontrolling interests | 4,439 | 4,103 | |||||
Basic weighted average shares and units outstanding | 68,767 | 68,182 | |||||
Diluted ownership interest | |||||||
Weighted average REIT common share and common share equivalents | 65,656 | 64,671 | |||||
Weighted average partnership units held by noncontrolling interests | 4,439 | 4,103 | |||||
Diluted weighted average shares and units outstanding | 70,095 | 68,774 | |||||
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share data)
2024 | 2023 | ||||||
Assets | (Unaudited) | ||||||
Commercial real estate properties, at cost: | |||||||
Land and land interests | $ | 1,150,681 | $ | 1,092,671 | |||
Building and improvements | 3,729,884 | 3,655,624 | |||||
Building leasehold and improvements | 1,358,851 | 1,354,569 | |||||
Right of use asset - operating leases | 953,236 | 953,236 | |||||
7,192,652 | 7,056,100 | ||||||
Less: accumulated depreciation | (2,078,203 | ) | (2,035,311 | ) | |||
5,114,449 | 5,020,789 | ||||||
Assets held for sale | 21,586 | — | |||||
Cash and cash equivalents | 196,035 | 221,823 | |||||
Restricted cash | 122,461 | 113,696 | |||||
Investment in marketable securities | 10,673 | 9,591 | |||||
Tenant and other receivables | 38,659 | 33,270 | |||||
Related party receivables | 12,229 | 12,168 | |||||
Deferred rents receivable | 267,969 | 264,653 | |||||
Debt and preferred equity investments, net of discounts and deferred origination fees of | 352,347 | 346,745 | |||||
Investments in unconsolidated joint ventures | 2,984,786 | 2,983,313 | |||||
Deferred costs, net | 109,296 | 111,463 | |||||
Other assets | 533,802 | 413,670 | |||||
Total assets | $ | 9,764,292 | $ | 9,531,181 | |||
Liabilities | |||||||
Mortgages and other loans payable | $ | 1,701,378 | $ | 1,497,386 | |||
Revolving credit facility | 650,000 | 560,000 | |||||
Unsecured term loan | 1,250,000 | 1,250,000 | |||||
Unsecured notes | 100,000 | 100,000 | |||||
Deferred financing costs, net | (15,875 | ) | (16,639 | ) | |||
Total debt, net of deferred financing costs | 3,685,503 | 3,390,747 | |||||
Accrued interest payable | 23,217 | 17,930 | |||||
Accounts payable and accrued expenses | 101,495 | 153,164 | |||||
Deferred revenue | 157,756 | 134,053 | |||||
Lease liability - financing leases | 105,859 | 105,531 | |||||
Lease liability - operating leases | 823,594 | 827,692 | |||||
Dividend and distributions payable | 20,135 | 20,280 | |||||
Security deposits | 56,398 | 49,906 | |||||
Liabilities related to assets held for sale | 10,649 | — | |||||
Junior subordinate deferrable interest debentures held by trusts that issued trust preferred securities | 100,000 | 100,000 | |||||
Other liabilities | 437,302 | 471,401 | |||||
Total liabilities | 5,521,908 | 5,270,704 | |||||
Commitments and contingencies | — | — | |||||
Noncontrolling interests in | 272,235 | 238,051 | |||||
Preferred units | 166,501 | 166,501 | |||||
Equity | |||||||
SL Green stockholders' equity: | |||||||
Series I Preferred Stock, | 221,932 | 221,932 | |||||
Common stock, | 660 | 660 | |||||
Additional paid-in capital | 3,831,130 | 3,826,452 | |||||
(128,655 | ) | (128,655 | ) | ||||
Accumulated other comprehensive income | 40,151 | 17,477 | |||||
Retained deficit | (229,607 | ) | (151,551 | ) | |||
3,735,611 | 3,786,315 | ||||||
Noncontrolling interests in other partnerships | 68,037 | 69,610 | |||||
Total equity | 3,803,648 | 3,855,925 | |||||
Total liabilities and equity | $ | 9,764,292 | $ | 9,531,181 | |||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(unaudited and in thousands, except per share data)
Three Months Ended | |||||||
Funds From Operations (FFO) Reconciliation: | 2024 | 2023 | |||||
Net income (loss) attributable to SL Green common stockholders | $ | 13,141 | $ | (39,731 | ) | ||
Add: | |||||||
Depreciation and amortization | 48,584 | 78,782 | |||||
Joint venture depreciation and noncontrolling interest adjustments | 74,258 | 69,534 | |||||
Net loss attributable to noncontrolling interests | (393 | ) | (3,962 | ) | |||
Less: | |||||||
Equity in net gain (loss) on sale of interest in unconsolidated joint venture/real estate | 26,764 | (79 | ) | ||||
Purchase price and other fair value adjustments | (55,652 | ) | — | ||||
Loss on sale of real estate, net | — | (1,651 | ) | ||||
Depreciable real estate reserves | (52,118 | ) | — | ||||
Depreciation on non-rental real estate assets | 1,153 | 868 | |||||
FFO attributable to SL Green common stockholders and unit holders | $ | 215,443 | $ | 105,485 | |||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(unaudited and in thousands, except per share data)
Three Months Ended | |||||||
Operating income and Same-store NOI Reconciliation: | 2024 | 2023 | |||||
Net income (loss) | $ | 18,389 | $ | (38,357 | ) | ||
Depreciable real estate reserves | 52,118 | — | |||||
Loss on sale of real estate, net | — | 1,651 | |||||
Purchase price and other fair value adjustments | 50,492 | (239 | ) | ||||
Equity in net (gain) loss on sale of interest in unconsolidated joint venture/real estate | (26,764 | ) | 79 | ||||
Depreciation and amortization | 48,584 | 78,782 | |||||
SUMMIT Operator tax expense | (1,295 | ) | 1,267 | ||||
Amortization of deferred financing costs | 1,539 | 2,021 | |||||
Interest expense, net of interest income | 31,173 | 41,653 | |||||
Operating income | 174,236 | 86,857 | |||||
Equity in net (income) loss from unconsolidated joint ventures | (111,160 | ) | 7,412 | ||||
Marketing, general and administrative expense | 21,313 | 23,285 | |||||
Transaction related costs | 16 | 884 | |||||
Loan loss and other investment reserves, net of recoveries | — | 6,890 | |||||
SUMMIT Operator expenses | 21,858 | 20,688 | |||||
Investment income | (7,403 | ) | (9,057 | ) | |||
SUMMIT Operator revenue | (25,604 | ) | (19,771 | ) | |||
Non-building revenue | (5,049 | ) | (6,806 | ) | |||
Net operating income (NOI) | 68,207 | 110,382 | |||||
Equity in net income (loss) from unconsolidated joint ventures | 111,160 | (7,412 | ) | ||||
SLG share of unconsolidated JV depreciation and amortization | 69,446 | 64,723 | |||||
SLG share of unconsolidated JV amortization of deferred financing costs | 3,095 | 3,062 | |||||
SLG share of unconsolidated JV interest expense, net of interest income | 72,803 | 63,146 | |||||
SLG share of unconsolidated JV loss on early extinguishment of debt | (141,664 | ) | — | ||||
SLG share of unconsolidated JV investment income | — | (313 | ) | ||||
SLG share of unconsolidated JV non-building revenue | (501 | ) | (2,298 | ) | |||
NOI including SLG share of unconsolidated JVs | 182,546 | 231,290 | |||||
NOI from other properties/affiliates | (24,930 | ) | (66,596 | ) | |||
Same-Store NOI | 157,616 | 164,694 | |||||
Straight-line and free rent | (3,187 | ) | (5,187 | ) | |||
Amortization of acquired above and below-market leases, net | 49 | 166 | |||||
Operating lease straight-line adjustment | 204 | 204 | |||||
SLG share of unconsolidated JV straight-line and free rent | (1,737 | ) | (8,888 | ) | |||
SLG share of unconsolidated JV amortization of acquired above and below-market leases, net | (4,407 | ) | (4,225 | ) | |||
SLG share of unconsolidated JV operating lease straight-line adjustment | — | (19 | ) | ||||
Same-store cash NOI | $ | 148,538 | $ | 146,745 | |||
Lease termination income | (1,163 | ) | (511 | ) | |||
SLG share of unconsolidated JV lease termination income | (3,286 | ) | (443 | ) | |||
Same-store cash NOI excluding lease termination income | $ | 144,089 | $ | 145,791 | |||
NON-GAAP FINANCIAL MEASURES - DISCLOSURES
Funds from Operations (FFO)
FFO is a widely recognized non-GAAP financial measure of REIT performance. The Company computes FFO in accordance with standards established by NAREIT, which may not be comparable to FFO reported by other REITs that do not compute FFO in accordance with the NAREIT definition, or that interpret the NAREIT definition differently than the Company does. The revised White Paper on FFO approved by the
The Company presents FFO because it considers it an important supplemental measure of the Company’s operating performance and believes that it is frequently used by securities analysts, investors and other interested parties in the evaluation of REITs, particularly those that own and operate commercial office properties. The Company also uses FFO as one of several criteria to determine performance-based compensation for members of its senior management. FFO is intended to exclude GAAP historical cost depreciation and amortization of real estate and related assets, which assumes that the value of real estate assets diminishes ratably over time. Historically, however, real estate values have risen or fallen with market conditions. Because FFO excludes depreciation and amortization unique to real estate, gains and losses from property dispositions, and real estate related impairment charges, it provides a performance measure that, when compared year over year, reflects the impact to operations from trends in occupancy rates, rental rates, operating costs, and interest costs, providing perspective not immediately apparent from net income. FFO does not represent cash generated from operating activities in accordance with GAAP and should not be considered as an alternative to net income (determined in accordance with GAAP), as an indication of the Company’s financial performance or to cash flow from operating activities (determined in accordance with GAAP) as a measure of the Company’s liquidity, nor is it indicative of funds available to fund the Company’s cash needs, including the Company's ability to make cash distributions.
Funds Available for Distribution (FAD)
FAD is a non-GAAP financial measure that is calculated as FFO plus non-real estate depreciation, allowance for straight line credit loss, adjustment for straight line operating lease rent, non-cash deferred compensation, and pro-rata adjustments for these items from the Company's unconsolidated JVs, less straight line rental income, free rent net of amortization, second cycle tenant improvement and leasing costs, and recurring capital expenditures.
FAD is not intended to represent cash flow for the period and is not indicative of cash flow provided by operating activities as determined in accordance with GAAP. FAD is presented solely as a supplemental disclosure with respect to liquidity because the Company believes it provides useful information regarding the Company’s ability to fund its dividends. Because all companies do not calculate FAD the same way, the presentation of FAD may not be comparable to similarly titled measures of other companies. FAD does not represent cash flow from operating, investing and finance activities in accordance with GAAP and should not be considered as an alternative to net income (determined in accordance with GAAP), as an indication of the Company’s financial performance, as an alternative to net cash flows from operating activities (determined in accordance with GAAP), or as a measure of the Company’s liquidity.
Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate (EBITDAre)
EBITDAre is a non-GAAP financial measure. The Company computes EBITDAre in accordance with standards established by the
The Company presents EBITDAre because the Company believes that EBITDAre, along with cash flow from operating activities, investing activities and financing activities, provides investors with an additional indicator of the Company’s ability to incur and service debt. EBITDAre should not be considered as an alternative to net income (determined in accordance with GAAP), as an indication of the Company’s financial performance, as an alternative to net cash flows from operating activities (determined in accordance with GAAP), or as a measure of the Company’s liquidity.
Net Operating Income (NOI) and Cash NOI
NOI is a non-GAAP financial measure that is calculated as operating income before transaction related costs, gains/losses on early extinguishment of debt, marketing general and administrative expenses and non-real estate revenue. Cash NOI is also a non-GAAP financial measure that is calculated by subtracting free rent (net of amortization), straight-line rent, and the amortization of acquired above and below-market leases from NOI, while adding operating lease straight-line adjustment and the allowance for straight-line tenant credit loss.
The Company presents NOI and Cash NOI because the Company believes that these measures, when taken together with the corresponding GAAP financial measures and reconciliations, provide investors with meaningful information regarding the operating performance of properties. When operating performance is compared across multiple periods, the investor is provided with information not immediately apparent from net income that is determined in accordance with GAAP. NOI and Cash NOI provide information on trends in the revenue generated and expenses incurred in operating the Company's properties, unaffected by the cost of leverage, straight-line adjustments, depreciation, amortization, and other net income components. The Company uses these metrics internally as performance measures. None of these measures is an alternative to net income (determined in accordance with GAAP) and same-store performance should not be considered an alternative to GAAP net income performance.
Coverage Ratios
The Company presents fixed charge and debt service coverage ratios to provide a measure of the Company’s financial flexibility to service current debt amortization, interest expense and operating lease rent from current cash net operating income. These coverage ratios represent a common measure of the Company’s ability to service fixed cash payments; however, these ratios are not used as an alternative to cash flow from operating, financing and investing activities (determined in accordance with GAAP).
SLG-EARN
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