Caesars Palace Times Square bid not “completely dead," says SL Green CEO Marc Holliday

The proposal to develop a $5.4 billion Caesars Palace casino in Times Square may have been rejected by a Manhattan community advisory committee, but SL Green Realty Corp. insists the idea still has life.

On Thursday’s third-quarter earnings call, SL Green Chairman and Chief Executive Officer Marc Holliday said the company remains open to the possibility of reviving its casino project at 1515 Broadway, a joint venture with Caesars Entertainment and Jay-Z’s Roc Nation.

“No, I don’t think, by any means, it’s to use your term completely dead,” Holliday said in response to a question from Bank of Montreal analyst John Kim. “I think the whole process and the outcome is still unknown. How many bidders will there be? How many licenses will be awarded - and whether, if any are held back, there’ll be another shot for casinos in Manhattan or otherwise to come into play.”

The rejection made SL Green the first to be eliminated from the downstate New York casino race, a blow that cost the company an estimated $13.1 million in related expenses. Still, Holliday said the real estate investment trust (REIT) is keeping its options open as the state’s gaming board finalizes decisions on up to three casino licenses expected by year-end.

“This is still a process playing out,” he said. The optimism comes amid a shakeup in the competition. MGM Resorts International this week withdrew from its own bid to convert the Empire City Casino in Yonkers into a full-scale gaming resort, citing changes in government guidance that made the project unfeasible. MGM’s exit leaves three competitors for three licenses, though regulators are under no obligation to award them all.

Render of the proposed development

Holliday reiterated that he still believes Manhattan deserves a casino, saying Times Square remains an unmatched location. “There should be at least one casino in Manhattan. I think that’s obvious and Times Square was the exact right location, but the process was designed to make that impossible, at least for the time being,” he said.

For now, SL Green continues to derive steady income from the 1515 Broadway property, whose main tenant, CBS, is backed by an acquisition from Skydance. Holliday said the company’s strong balance sheet and flexible capital position leave it well prepared to pivot if the gaming plan fails to materialize.

“The beautiful thing is right now we’ve got so much flexibility because our debt per square foot is, I think, like $3.75 a foot or thereabouts. So we have complete financial flexibility,” he said.

“The building’s net leased through, I think, the middle of 2031, and the cash flow is significant from the property. And that’s a good scenario for us to sort of look at all options, commence multiple negotiations, and try and end up in the best place.”

SL Green’s resilience has been supported by strong quarterly results. The company reported funds from operations (FFO) of $1.58 per share, outperforming Wall Street’s consensus estimate of $1.41 and marking a 39% increase over the same period in 2024. The FFO figure included transaction costs from the casino bid.

In the third quarter, SL Green signed 52 Manhattan office leases totaling 658,000 square feet, pushing occupancy up to 92%, with projections to surpass 93% by year-end. The REIT has been one of the major players driving New York’s office market recovery, with leasing activity and rents for prime properties returning to or exceeding pre-pandemic levels.

Holliday also highlighted the company’s growing presence along Park Avenue. SL Green recently agreed to purchase Park Avenue Tower from Blackstone for $730 million and plans to finance $475 million of that acquisition through new borrowing, with the remainder funded by equity.