UPDATE: Cantor Fitzgerald Downgrades SL Green Realty on Fair Valuation

In a report published Friday, Cantor Fitzgerald analyst David Toti downgraded the rating on SL Green Realty Corp. (NYSE: SLG) from Buy to Hold, but reiterated the $99.00 price target.

In the report, Cantor Fitzgerald noted, “Although we continue to favor CBD office assets over suburban, given stronger fundamentals and an expectation for more stable forward cap rates, we believe this is now likely a consensus view - which has led to a run-up in SLG's share price; we now view valuation as fair and downgrade shares to HOLD from BUY. Despite the more neutral stance, we believe the overall Manhattan office market remains stable and improving, with an increasingly diversified employment base and continued global capital inflows. SL Green remains well positioned in the growing Midtown South market, as it continues to successfully generate 1x investment returns amidst a measured redev./repos. pipeline. Downside risks would include the mezz. portfolio (should rates become unhinged), and growing supply levels that could hamper rent growth.”

SL Green Realty Corp. closed on Thursday at $94.67.