ESRT: Raised 2026 FFO guidance as leasing momentum offset continued Observation Deck weakness

What happened

Core funds from operations per share, a key property company profit measure, was $0.20. 2026 guidance rose to $0.77-$0.80 per share. Leasing stayed strong while the Observation Deck remained weak, and 1359 Broadway sold after quarter-end for $217.5M.

Confirmed

Global impact / market context

Higher guidance signals management expects more cash profit per share, supported by strong leasing that fills space and generates rent revenue. The Observation Deck weakness weighs on tourism-linked income, while the $217.5M building sale gives cash available for debt reduction or reinvestment.

Analyst inference

For investors, the split matters: office leasing momentum and asset sales support earnings and cash available, while the weak Observation Deck shows a tourism-dependent revenue line still under pressure. The raised guidance suggests management sees the leasing trend offsetting that softness.

Analyst inference

What to watch

1. Whether leasing momentum continues and translates into higher rent revenue, since the summary credits leasing strength for offsetting continued Observation Deck weakness in the raised 2026 guidance. Confirmed
2. How ESRT uses the $217.5M proceeds from the 1359 Broadway sale, such as repaying borrowed money or funding capital spending, which would affect cash available and future profit. Analyst inference
3. Whether Observation Deck weakness persists or deepens, because continued softness there could pressure tourism-linked revenue and test whether leasing gains keep offsetting it. Analyst inference

Evidence

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