Marc Holliday 5.0 3 ideas

"You're seeing just an extraordinary growth in leasing in New York that I haven't seen in my career... At the end of this year, we expect two thirds of our portfolio to be 98% leased on a weighted average basis." The broader market has heavily discounted office REITs based on the assumption that remote work and AI-driven job losses have permanently impaired office demand. However, on-the-ground data shows a massive "space grab" by law firms, fintechs, and AI companies signing 15-to-20-year leases. As prime Manhattan office buildings fill up, landlords with high-quality, well-located assets will see stronger-than-expected cash flows, forcing a positive re-rating of their heavily shorted or discounted shares. LONG NYC-focused office REITs as fundamental leasing velocity and long-term tenant commitments completely contradict the bearish macro narrative surrounding commercial real estate. Persistently high interest rates could keep debt servicing and refinancing costs elevated; potential NYC property tax hikes to plug municipal budget deficits could eat into operating margins.