NEW YORK | 15 Penn Plaza (Hotel Penn) | 1,034 FT / 315 M | 53 FLOORS

[NYguy]

https://therealdeal.com/2022/11/01/o...roth-says/amp/

Office stocks are “stupid cheap,” Vornado’s Roth says


BY KATHRYN BRENZEL
NOV 1, 2022

The demolition of the Hotel Pennsylvania is on track to be completed by the end of next year, but then what?

Vornado Realty Trust CEO Steve Roth cast doubt on its project Tuesday during the real estate investment trusts’ third quarter earnings call — yet also predicted a comeback for beaten-up office sector stocks, which he called “stupid cheap.”

“I must say, the headwinds and the current environment are not at all conducive to ground-up development,” he said.

When asked about the level of pre-leasing necessary to move forward with the office tower and if Vornado is considering non-office uses for the project, dubbed Penn 15, Roth opted to “duck” the question, in his words.

“In terms of changing uses and what have you, that’s not something that we are going to get into now,” he said.

Later in the call, Roth said Vornado is “absolutely, strongly convicted” about its plans for the Penn District, and is confident that companies and people will continue to flock to New York.

A little more on that…



https://www.marketscreener.com/quote...2022-42167393/

Our next question is from John Kim with BMO Capital Markets.

Question
John Kim (Analysts)

You talked about the cautious environment. There was a lot more of an optimistic case in the post this week on New York office, and in particular, PENN15. I was wondering if you could provide an update on the project, how much preleasing you would need to move forward with the development? And if there's any consideration to change the use of the project to have less office going forward?

Answer
Steven Roth (Executives)

John, thanks for the question. I'm going to duck the question. a couple of things. I did say in my prepared remarks that the current environment makes grounds up the development very difficult. And I meant it. So that's number one. Number 2 is in terms of changing uses and what have you, that's not something we're going to get into now.

Steven Roth (Executives)

We are absolutely strongly convicted about what we're doing in the PENN District. We think that, that is going to be another center of New York, and an extraordinary success. So we're very, very, very excited about that.