continues toweigh a possible spinoffof its Washington, D.C., business as part of a broader effort to right a perceivedvaluation gap, the REIT's chairman and CEO, Steven Roth, said in his annual letterto shareholders.
"Ourobjective in pursuing a separation of Washington would be much the same as it wasin our separation of Urban Edge Properties, namely to create a smaller, laser-focusedbusiness unit with its own dedicated management and its own report card (i.e. stockprice)," Roth said in the letter, attached to an April 8 filing.
Rothnoted in his remarks that the noncore shopping center properties that became , while potentially"great" in their own right, were not a "natural fit" for a companyportfolio dominated by "million square foot Manhattan office towers."
"Whileit is true that Washington and New York are both office-centric, each is its ownmarket and there really is little overlap or synergy between them," Roth said."Furthermore, New York and Washington are in totally different lifecycle situations(growth vs recovery)."
The companyexpects 2016 EBITDA for its core Washington, D.C., business, excluding its Skylineproperties and buildings coming out of service, to range from "flat to positive$4 million" relative to the 2015 figure.
Rothnoted in his remarks that the company has begun a process to dispose of the Skylineproperties, but there is no guarantee a spinoff transaction ultimately will takeplace.