Wall Street Downgrades Vornado Realty Trust as Office REITs Lead Sector Losses

"Morgan Stanley's revision stems from a broader office sector update tied to job opening data across REIT markets. The underlying concern is structural: white-collar employment trends directly shape office demand, and softening job openings signal a slower leasing recovery than previously modeled."

"Vornado owns and manages a concentrated portfolio of Manhattan office buildings and street retail, with key assets spanning the Penn District, Park Avenue, and Fifth Avenue. New York Office revenue reached $1.275 billion in full-year 2025, anchored by tenants including Meta, Citadel, Bloomberg, and Google."

"The balance sheet carries $840.85 million in cash against total liabilities, indicating a cautious financial position amid declining occupancy rates and reduced revenue forecasts."

Vornado Realty Trust is experiencing increased scrutiny as office REITs are the worst-performing subsector year-to-date. Morgan Stanley reduced its price target for Vornado from $32 to $28, maintaining an Equal Weight rating. The stock is currently trading near $25.52, just above its 52-week low. The revision reflects concerns about structural issues in the office sector, particularly related to white-collar employment trends and softening job openings. Vornado's office occupancy is at 91.2%, while retail occupancy is lower at 79.4%. Recent financial performance shows a decline in FFO per share.

Read at 24/7 Wall St.