Anthony Malkin concerned over “PR bruise” from Trump travel ban

ESRT CEO also addressed possibility of company merger

New York /
Apr.April 27, 2017 10:55 AM

Empire State Realty Trust’s CEO Anthony Malkin said he is worried Donald Trump’s travel ban could hurt tourism in New York.

“It’s very clear that we absolutely have a concern about reported incidents” of travelers bypassing the U.S., Malkin said during the real estate investment trust’s quarterly earnings call Thursday.

The REIT gets a big chunk of its revenue from the Empire State Building’s observation deck which in turn relied on a steady flow of tourists. Still, Malkin said his company is unlikely to be impacted by the travel ban. “We do take some comfort in the fact, apart from the P.R. bruise the U.S. takes, (…) that not many people from those countries are visitors to the Empire State Building observatory,” he said.

Observatory revenues in the first quarter fell 1.4 percent compared to a year earlier, which the REIT blames on “unfavorable weather conditions.”

Earlier this month, Marriott International’s CEO Arne Sorenson told a company gathering that the travel ban, which impacts a handful of Muslim-majority countries, hurt the hotel industry and is “not good, period.”

Malkin also addressed the possibility that Empire State Realty Trust TRData LogoTINY could merge with another company or go private, although he cautioned that neither is likely at the moment. “For me to give up control of our balance sheet, it would have to be to someone in whom I have tremendous confidence,” he said. Malkin added that he had had several conversations about potential mergers or acquisitions this week alone, but claims none concerned a potential takeover of ESRT by another company.

Analysts have been predicting an uptick in REIT mergers and privatizations, in part because several trusts trade at a discount to the value of their properties, making them a bargain. Proposed changes to the tax code could also undermine the financial advantage of keeping a company public. New York REIT last year announced that it would liquidate itself by selling its buildings in the private market.

(To view our Deal Sheet’s office leasing transactions for the Empire State Building, click here)


Related Articles

arrow_forward_ios
Make Greenland Great Again? Trump wants to buy Arctic territory
Make Greenland Great Again? Trump wants to buy Arctic territory
Make Greenland Great Again? Trump wants to buy Arctic territory
Hamptons’ priciest summer rental to host MAGA extravaganza next month
Hamptons’ priciest summer rental to host MAGA extravaganza next month
Hamptons’ priciest summer rental to host MAGA extravaganza next month
Queens official Donovan Richards, Larry Silverstein and rendering of Innovation QNS (Queens Borough President, Innovation QNS, Getty)
Queens boro prez turns on industry, rejects Silverstein’s $2B project
Queens boro prez turns on industry, rejects Silverstein’s $2B project
Cea Weaver (Getty)
Cea Weaver pokes landlords’ hive over rent reform
Cea Weaver pokes landlords’ hive over rent reform
United States Representative James Clyburn (Getty Images)
Four corporate landlords used “abusive tactics” in pandemic evictions: House committee
Four corporate landlords used “abusive tactics” in pandemic evictions: House committee
Empire State Realty Trust's Tony Malkin with 1400 Broadway
Burlington grows bigger at ESRT’s 1400 Broadway
Burlington grows bigger at ESRT’s 1400 Broadway
Senator Chuck Schumer and Senator Joe Manchin (Illustration by Kevin Cifuentes for The Real Deal with Getty)
Manchin-Schumer deal closes real estate tax loophole
Manchin-Schumer deal closes real estate tax loophole
Empire State Realty Trust’s Tony Malkin and Shanae Ursini with 501 Seventh Avenue
Trading trains: Security firm jumps from Grand Central to Penn
Trading trains: Security firm jumps from Grand Central to Penn
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...