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As Of Filer Filing For·On·As Docs:Size 10/30/17 Vornado Realty Trust 10-Q 9/30/17 104:18M Vornado Realty LP |
Document/Exhibit Description Pages Size 1: 10-Q Quarterly Report HTML 1.81M 2: EX-15.1 Letter re: Unaudited Interim Financial Info HTML 33K 3: EX-15.2 Letter re: Unaudited Interim Financial Info HTML 29K 4: EX-31.1 Certification -- §302 - SOA'02 HTML 35K 5: EX-31.2 Certification -- §302 - SOA'02 HTML 35K 6: EX-31.3 Certification -- §302 - SOA'02 HTML 35K 7: EX-31.4 Certification -- §302 - SOA'02 HTML 35K 8: EX-32.1 Certification -- §906 - SOA'02 HTML 30K 9: EX-32.2 Certification -- §906 - SOA'02 HTML 30K 10: EX-32.3 Certification -- §906 - SOA'02 HTML 31K 11: EX-32.4 Certification -- §906 - SOA'02 HTML 31K 18: R1 Document and Entity Information HTML 59K 19: R2 Consolidated Balance Sheets HTML 175K 20: R3 Consolidated Balance Sheets (Parentheticals) HTML 70K 21: R4 Consolidated Statements of Income (Unaudited) HTML 175K 22: R5 Consolidated Statements of Comprehensive Income HTML 57K (Unaudited) 23: R6 Consolidated Statements of Changes in Equity HTML 199K (Unaudited) 24: R7 Consolidated Statements of Cash Flows (Unaudited) HTML 217K 25: R8 Consolidated Statements of Cash Flows (Unaudited) HTML 36K (Parentheticals) 26: R9 Organization HTML 32K 27: R10 Basis of Presentation HTML 33K 28: R11 Recently Issued Accounting Literature HTML 53K 29: R12 Real Estate Fund Investments HTML 67K 30: R13 Marketable Securities HTML 55K 31: R14 Investments in Partially Owned Entities HTML 162K 32: R15 Dispositions HTML 100K 33: R16 Identified Intangible Assets and Liabilities HTML 72K 34: R17 Debt HTML 68K 35: R18 Redeemable Noncontrolling Interests / Redeemable HTML 55K Partnership Units 36: R19 Accumulated Other Comprehensive Income ("Aoci") HTML 131K 37: R20 Variable Interest Entities ("VIEs") HTML 36K 38: R21 Fair Value Measurements HTML 201K 39: R22 Stock-based Compensation HTML 35K 40: R23 Fee and Other Income HTML 51K 41: R24 Interest and Other Investment Income, Net HTML 51K 42: R25 Interest and Debt Expense HTML 46K 43: R26 (Loss) Income Per Share / (Loss) Income Per Class HTML 197K A Unit 44: R27 Commitments and Contingencies HTML 44K 45: R28 Segment Information HTML 545K 46: R29 Subsequent Event HTML 32K 47: R30 Recently Issued Accounting Literature (Policies) HTML 91K 48: R31 Real Estate Fund Investments (Tables) HTML 63K 49: R32 Marketable Securities and Derivative Instruments HTML 53K (Tables) 50: R33 Investments in Partially Owned Entities (Tables) HTML 130K 51: R34 Dispositions (Tables) HTML 92K 52: R35 Identified Intangible Assets and Liabilities HTML 76K (Tables) 53: R36 Debt (Tables) HTML 70K 54: R37 Redeemable Noncontrolling Interests / Redeemable HTML 51K Partnership Units (Tables) 55: R38 Accumulated Other Comprehensive Income ("Aoci") HTML 128K (Tables) 56: R39 Fair Value Measurements (Tables) HTML 203K 57: R40 Fee and Other Income (Tables) HTML 49K 58: R41 Interest and Other Investment Income, Net (Tables) HTML 49K 59: R42 Interest and Debt Expense (Tables) HTML 46K 60: R43 Income Per Share / Income Per Class A Unit HTML 197K (Tables) 61: R44 Segment Information (Tables) HTML 540K 62: R45 Organization (Narrative) (Details) HTML 30K 63: R46 Recently Issued Accounting Literature (Narrative) HTML 35K (Details) 64: R47 Real Estate Fund Investments (Narrative) (Details) HTML 65K 65: R48 Real Estate Fund Investments (Income from the Fund HTML 54K and the Co-Investment) (Details) 66: R49 Marketable Securities (Marketable securities HTML 41K portfolio) (Details) 67: R50 Investments in Partially Owned Entities HTML 81K (Alexander's Inc.) (Details) 68: R51 Investments in Partially Owned Entities (Urban HTML 64K Edge Properties and PREIT) (Details) 69: R52 Investments in Partially Owned Entities (Farley HTML 107K Post Office, NY Mezzanine Loan, Suffolk Downs) (Details) 70: R53 Investments in Partially Owned Entities (330 HTML 87K Madison Avenue, 280 Park Avenue and Toys R Us) (Details) 71: R54 Investments in Partially Owned Entities (Summary HTML 55K of Investments) (Details) 72: R55 Investments in Partially Owned Entities (Summary HTML 60K of Income (Loss) ) (Details) 73: R56 Investments in Partially Owned Entities (Summary HTML 39K of Income (Loss) subnote ) (Details) 74: R57 Dispositions (Narrative) (Details) HTML 80K 75: R58 Dispositions (Assets and liabilities related to HTML 87K dispositions) (Details) 76: R59 Identified Intangible Assets and Liabilities HTML 70K (Details) 77: R60 Debt (Summary of Debt) (Details) HTML 67K 78: R61 Redeemable Noncontrolling Interests / Redeemable HTML 53K Partnership Units (Activity of Redeemable Noncontrolling Interests) (Details) 79: R62 Redeemable Noncontrolling Interests / Redeemable HTML 39K Partnership Units (Narratives) (Details) 80: R63 Accumulated Other Comprehensive Income ("Aoci") HTML 57K (AOCI by component) (Details) 81: R64 Variable Interest Entities ("VIEs") (Details) HTML 39K 82: R65 Fair Value Measurements (Financial Assets and HTML 68K Liabilities Measured at Fair Value on a Recurring Basis) (Details) 83: R66 Fair Value Measurements (Narrative) (Details) HTML 49K 84: R67 Fair Value Measurements (Unobervable Quantitative HTML 42K Input Ratios) (Details) 85: R68 Fair Value Measurements (Changes in the Fair Value HTML 54K of Real Estate Fund Investments and Deferred Compensation Plan Assets) (Details) 86: R69 Fair Value Measurements (Fair Value Measurements HTML 35K on a Nonrecurring Basis) (Details) 87: R70 Fair Value Measurements (Carrying amounts and fair HTML 70K value of financial instruments) (Details) 88: R71 Stock-based Compensation (Narrative) (Details) HTML 32K 89: R72 Fee and Other Income (Details) HTML 41K 90: R73 Interest and Other Investment Income, Net HTML 39K (Details) 91: R74 Interest and Debt Expense (Details) HTML 38K 92: R75 Income Per Share / Income Per Class A Unit HTML 130K (Details) 93: R76 Income Per Share / Income Per Class A Unit HTML 35K (Narrative) (Details) 94: R77 Commitments and Contingencies (Details) HTML 65K 95: R78 Segment Information (Summary of net income and HTML 164K EBITDA reconciliation by segment) (Details) 96: R79 Segment Information (Narrative) (Details) HTML 42K 97: R80 Segment Information (New York Segment - EBITDA) HTML 62K (Details) 98: R81 Segment Information (New York Segment - NOI) HTML 50K (Details) 99: R82 Segment Information (Other Segment - EBITDA) HTML 101K (Details) 100: R83 Segment Information (Other Segment - NOI) HTML 57K (Details) 101: R84 Subsequent Event (Narrative) (Details) HTML 63K 103: XML IDEA XML File -- Filing Summary XML 187K 102: EXCEL IDEA Workbook of Financial Reports XLSX 130K 12: EX-101.INS XBRL Instance -- vno-20170930 XML 5.88M 14: EX-101.CAL XBRL Calculations -- vno-20170930_cal XML 329K 15: EX-101.DEF XBRL Definitions -- vno-20170930_def XML 1.50M 16: EX-101.LAB XBRL Labels -- vno-20170930_lab XML 2.29M 17: EX-101.PRE XBRL Presentations -- vno-20170930_pre XML 1.65M 13: EX-101.SCH XBRL Schema -- vno-20170930 XSD 276K 104: ZIP XBRL Zipped Folder -- 0000899689-17-000057-xbrl Zip 432K
Document |
☑ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For
the quarterly period ended: |
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For
the transition period from: | to |
Vornado Realty Trust Vornado Realty L.P. |
Vornado
Realty Trust | Maryland | 22-1657560 | ||
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification Number) | |||
Vornado
Realty L.P. | Delaware | 13-3925979 | ||
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification Number) |
888 Seventh Avenue, New York, New York, 10019 |
(Address
of principal executive offices) (Zip Code) |
(212) 894-7000 |
(Registrants’ telephone number, including area code) |
N/A |
(Former name, former address and former fiscal year, if changed since last report) |
Vornado Realty Trust: | ||
☑ Large Accelerated Filer | ☐ Accelerated Filer | |
☐ Non-Accelerated
Filer (Do not check if smaller reporting company) | ☐ Smaller Reporting Company | |
☐ Emerging Growth Company |
Vornado Realty L.P.: | ||
☐
Large Accelerated Filer | ☐ Accelerated Filer | |
☑ Non-Accelerated Filer (Do not check if smaller reporting company) | ☐ Smaller Reporting Company | |
☐ Emerging Growth Company |
• | enhances investors’ understanding of Vornado and the Operating
Partnership by enabling investors to view the business as a whole in the same manner as management views and operates the business; |
• | eliminates duplicative disclosure and provides a more streamlined and readable presentation because a substantial portion of the disclosure applies to both Vornado and the Operating Partnership; and |
• | creates time and cost efficiencies in the preparation of one combined report instead of two separate reports. |
• | Item
1. Financial Statements (unaudited), which includes the following specific disclosures for Vornado Realty Trust and Vornado Realty L.P.: |
• | Note 10. Redeemable Noncontrolling Interests/Redeemable Partnership Units |
• | Note 18. (Loss) Income Per Share/(Loss) Income Per Class A Unit |
• | Item
2. Management’s Discussion and Analysis of Financial Condition and Results of Operations includes information specific to each entity, where applicable. |
PART
I. | Financial Information: | Page Number | ||
Consolidated Balance Sheets (Unaudited) as of September 30, 2017 and December 31, 2016 | ||||
Consolidated
Statements of Income (Unaudited) for the Three and Nine Months Ended September 30, 2017 and 2016 | ||||
Consolidated Statements of Comprehensive Income
(Unaudited) for the Three and Nine Months Ended September 30, 2017 and 2016 | ||||
Consolidated Statements of Changes in Equity (Unaudited) for the Nine
Months Ended September 30, 2017 and 2016 | ||||
Consolidated Statements of Cash Flows (Unaudited) for the Nine Months Ended September
30, 2017 and 2016 | ||||
Financial Statements of Vornado Realty L.P.: | ||||
Consolidated
Balance Sheets (Unaudited) as of September 30, 2017 and December 31, 2016 | ||||
Consolidated Statements of Income (Unaudited) for the Three and Nine
Months Ended September 30, 2017 and 2016 | ||||
Consolidated Statements of Comprehensive Income (Unaudited) for the Three and Nine Months Ended September
30, 2017 and 2016 | ||||
Consolidated Statements of Changes in Equity (Unaudited) for the Nine Months Ended September 30, 2017 and 2016 | ||||
Consolidated
Statements of Cash Flows (Unaudited) for the Nine Months Ended September 30, 2017 and 2016 | ||||
Vornado Realty Trust and Vornado Realty L.P.: | ||||
PART II. | Other Information: | |||
(Amounts in thousands, except unit, share, and per share amounts) | |||||||
ASSETS | |||||||
Real
estate, at cost: | |||||||
Land | $ | 3,124,971 | $ | 3,130,825 | |||
Buildings and improvements | 9,824,618 | 9,684,144 | |||||
Development
costs and construction in progress | 1,536,290 | 1,278,941 | |||||
Leasehold improvements and equipment | 96,820 | 93,910 | |||||
Total | 14,582,699 | 14,187,820 | |||||
Less
accumulated depreciation and amortization | (2,805,160 | ) | (2,581,514 | ) | |||
Real estate, net | 11,777,539 | 11,606,306 | |||||
Cash and cash equivalents | 1,282,230 | 1,501,027 | |||||
Restricted
cash | 103,553 | 95,032 | |||||
Marketable securities | 193,145 | 203,704 | |||||
Tenant and other receivables, net of allowance for doubtful accounts of $5,539 and
$6,708 | 54,769 | 61,069 | |||||
Investments in partially owned entities | 1,064,982 | 1,378,254 | |||||
Real estate fund investments | 351,750 | 462,132 | |||||
Receivable
arising from the straight-lining of rents, net of allowance of $1,215 and $2,227 | 917,827 | 885,167 | |||||
Deferred leasing costs, net of accumulated amortization of $186,041 and $170,952 | 354,573 | 354,997 | |||||
Identified
intangible assets, net of accumulated amortization $144,683 and $194,422 | 166,198 | 189,668 | |||||
Assets related to discontinued operations | 1,774 | 3,568,613 | |||||
Other
assets | 573,780 | 508,878 | |||||
$ | 16,842,120 | $ | 20,814,847 | ||||
LIABILITIES,
REDEEMABLE NONCONTROLLING INTERESTS AND EQUITY | |||||||
Mortgages payable, net | $ | 8,131,606 | $ | 8,113,248 | |||
Senior unsecured notes, net | 846,641 | 845,577 | |||||
Unsecured
term loan, net | 373,354 | 372,215 | |||||
Unsecured revolving credit facilities | — | 115,630 | |||||
Accounts payable and accrued expenses | 412,100 | 397,134 | |||||
Deferred
revenue | 240,377 | 276,276 | |||||
Deferred compensation plan | 106,244 | 121,183 | |||||
Liabilities related to discontinued operations | 3,602 | 1,259,443 | |||||
Other
liabilities | 469,919 | 417,199 | |||||
Total liabilities | 10,583,843 | 11,917,905 | |||||
Commitments and contingencies | |||||||
Redeemable
noncontrolling interests: | |||||||
Class A units - 12,555,623 and 12,197,162 units outstanding | 965,276 | 1,273,018 | |||||
Series D cumulative redeemable preferred units - 177,101 units outstanding | 5,428 | 5,428 | |||||
Total
redeemable noncontrolling interests | 970,704 | 1,278,446 | |||||
Vornado's shareholders' equity: | |||||||
Preferred shares of beneficial interest: no par value per share; authorized 110,000,000 shares; issued and outstanding 42,823,428 and 42,824,829 shares | 1,038,011 | 1,038,055 | |||||
Common
shares of beneficial interest: $0.04 par value per share; authorized 250,000,000 shares; issued and outstanding 189,877,859 and 189,100,876 shares | 7,571 | 7,542 | |||||
Additional capital | 7,501,823 | 7,153,332 | |||||
Earnings
less than distributions | (4,098,127 | ) | (1,419,382 | ) | |||
Accumulated other comprehensive income | 121,801 | 118,972 | |||||
Total Vornado shareholders' equity | 4,571,079 | 6,898,519 | |||||
Noncontrolling
interests in consolidated subsidiaries | 716,494 | 719,977 | |||||
Total equity | 5,287,573 | 7,618,496 | |||||
$ | 16,842,120 | $ | 20,814,847 |
(Amounts in thousands, except per share amounts) | Three
Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
REVENUES: | |||||||||||||||
Property
rentals | $ | 432,062 | $ | 411,153 | $ | 1,275,597 | $ | 1,238,903 | |||||||
Tenant
expense reimbursements | 63,401 | 60,957 | 174,091 | 162,831 | |||||||||||
Fee and other income | 33,292 | 30,643 | 98,212 | 88,034 | |||||||||||
Total
revenues | 528,755 | 502,753 | 1,547,900 | 1,489,768 | |||||||||||
EXPENSES: | |||||||||||||||
Operating | 225,226 | 213,762 | 661,585 | 626,546 | |||||||||||
Depreciation
and amortization | 104,972 | 105,877 | 315,223 | 316,383 | |||||||||||
General and administrative | 36,261 | 33,584 | 122,161 | 112,593 | |||||||||||
Acquisition
and transaction related costs | 61 | 1,069 | 1,073 | 6,697 | |||||||||||
Total expenses | 366,520 | 354,292 | 1,100,042 | 1,062,219 | |||||||||||
Operating
income | 162,235 | 148,461 | 447,858 | 427,549 | |||||||||||
(Loss) income from partially owned entities | (41,801 | ) | 3,811 | 5,578 | 3,892 | ||||||||||
(Loss)
income from real estate fund investments | (6,308 | ) | 1,077 | (1,649 | ) | 28,750 | |||||||||
Interest and other investment income, net | 9,306 | 6,459 | 27,800 | 20,121 | |||||||||||
Interest
and debt expense | (85,068 | ) | (79,721 | ) | (252,581 | ) | (250,034 | ) | |||||||
Net gains on disposition of wholly owned and partially owned assets | — | — | 501 | 160,225 | |||||||||||
Income
before income taxes | 38,364 | 80,087 | 227,507 | 390,503 | |||||||||||
Income tax expense | (1,188 | ) | (4,563 | ) | (2,429 | ) | (8,921 | ) | |||||||
Income
from continuing operations | 37,176 | 75,524 | 225,078 | 381,582 | |||||||||||
(Loss) income from discontinued operations | (47,930 | ) | 25,080 | (14,501 | ) | (104,204 | ) | ||||||||
Net
(loss) income | (10,754 | ) | 100,604 | 210,577 | 277,378 | ||||||||||
Less net (income) loss attributable to noncontrolling interests in: | |||||||||||||||
Consolidated
subsidiaries | (4,022 | ) | (3,658 | ) | (18,436 | ) | (26,361 | ) | |||||||
Operating Partnership | 1,878 | (4,366 | ) | (9,057 | ) | (11,410 | ) | ||||||||
Net
(loss) income attributable to Vornado | (12,898 | ) | 92,580 | 183,084 | 239,607 | ||||||||||
Preferred share dividends | (16,128 | ) | (19,047 | ) | (48,386 | ) | (59,774 | ) | |||||||
Preferred
share issuance costs (Series J redemption) | — | (7,408 | ) | — | (7,408 | ) | |||||||||
NET (LOSS) INCOME attributable to common shareholders | $ | (29,026 | ) | $ | 66,125 | $ | 134,698 | $ | 172,425 | ||||||
(LOSS)
INCOME PER COMMON SHARE – BASIC: | |||||||||||||||
Income from continuing operations, net | $ | 0.09 | $ | 0.23 | $ | 0.78 | $ | 1.43 | |||||||
(Loss)
income from discontinued operations, net | (0.24 | ) | 0.12 | (0.07 | ) | (0.52 | ) | ||||||||
Net (loss) income per common share | $ | (0.15 | ) | $ | 0.35 | $ | 0.71 | $ | 0.91 | ||||||
Weighted
average shares outstanding | 189,593 | 188,901 | 189,401 | 188,778 | |||||||||||
(LOSS)
INCOME PER COMMON SHARE – DILUTED: | |||||||||||||||
Income from continuing operations, net | $ | 0.09 | $ | 0.23 | $ | 0.78 | $ | 1.42 | |||||||
(Loss)
income from discontinued operations, net | (0.24 | ) | 0.12 | (0.07 | ) | (0.51 | ) | ||||||||
Net (loss) income per common share | $ | (0.15 | ) | $ | 0.35 | $ | 0.71 | $ | 0.91 | ||||||
Weighted
average shares outstanding | 190,847 | 190,048 | 191,257 | 190,086 | |||||||||||
DIVIDENDS
PER COMMON SHARE | $ | 0.60 | $ | 0.63 | $ | 2.02 | $ | 1.89 |
(Amounts in thousands) | For
the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Net (loss) income | $ | (10,754 | ) | $ | 100,604 | $ | 210,577 | $ | 277,378 | ||||||
Other
comprehensive income (loss): | |||||||||||||||
Increase (reduction) in unrealized net gain on available-for-sale securities | 5,656 | 3,685 | (10,559 | ) | 42,798 | ||||||||||
Pro
rata share of amounts reclassified from accumulated other comprehensive income of a nonconsolidated subsidiary | (646 | ) | — | 8,622 | — | ||||||||||
Pro rata share of other comprehensive
loss of nonconsolidated subsidiaries | (626 | ) | (915 | ) | (1,657 | ) | (1,537 | ) | |||||||
Increase (reduction) in value of interest rate swaps and other | 1,973 | 7,689 | 6,611 | (3,482 | ) | ||||||||||
Comprehensive
(loss) income | (4,397 | ) | 111,063 | 213,594 | 315,157 | ||||||||||
Less comprehensive income attributable to noncontrolling interests | (2,539 | ) | (8,665 | ) | (27,681 | ) | (40,097 | ) | |||||||
Comprehensive
(loss) income attributable to Vornado | $ | (6,936 | ) | $ | 102,398 | $ | 185,913 | $ | 275,060 |
(Amounts
in thousands) | ||||||||||||||||||||||||||||||||||
Preferred
Shares | Common Shares | Additional Capital | Earnings Less Than Distributions | Accumulated Other Comprehensive Income | Non-controlling Interests in Consolidated Subsidiaries | Total
Equity | ||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||||||||||||||||||||
Balance,
December 31, 2016 | 42,825 | $ | 1,038,055 | 189,101 | $ | 7,542 | $ | 7,153,332 | $ | (1,419,382 | ) | $ | 118,972 | $ | 719,977 | $ | 7,618,496 | |||||||||||||||||
Net
income attributable to Vornado | — | — | — | — | — | 183,084 | — | — | 183,084 | |||||||||||||||||||||||||
Net
income attributable to noncontrolling interests in consolidated subsidiaries | — | — | — | — | — | — | — | 18,436 | 18,436 | |||||||||||||||||||||||||
Dividends
on common shares | — | — | — | — | — | (382,552 | ) | — | — | (382,552 | ) | |||||||||||||||||||||||
Dividends
on preferred shares | — | — | — | — | — | (48,386 | ) | — | — | (48,386 | ) | |||||||||||||||||||||||
Common
shares issued: | ||||||||||||||||||||||||||||||||||
Upon
redemption of Class A units, at redemption value | — | — | 349 | 14 | 34,550 | — | — | — | 34,564 | |||||||||||||||||||||||||
Under
employees' share option plan | — | — | 409 | 15 | 23,877 | — | — | — | 23,892 | |||||||||||||||||||||||||
Under
dividend reinvestment plan | — | — | 12 | — | 1,119 | — | — | — | 1,119 | |||||||||||||||||||||||||
Contributions | — | — | — | — | — | — | — | 1,044 | 1,044 | |||||||||||||||||||||||||
Distributions: | ||||||||||||||||||||||||||||||||||
JBG
SMITH Properties | — | — | — | — | — | (2,430,427 | ) | — | — | (2,430,427 | ) | |||||||||||||||||||||||
Real
estate fund investments | — | — | — | — | — | — | — | (20,851 | ) | (20,851 | ) | |||||||||||||||||||||||
Other | — | — | — | — | — | — | — | (1,815 | ) | (1,815 | ) | |||||||||||||||||||||||
Conversion
of Series A preferred shares to common shares | (2 | ) | (44 | ) | 2 | — | 44 | — | — | — | — | |||||||||||||||||||||||
Deferred
compensation shares and options | — | — | 1 | — | 1,975 | (418 | ) | — | — | 1,557 | ||||||||||||||||||||||||
Reduction
in unrealized net gain on available-for-sale securities | — | — | — | — | — | — | (10,559 | ) | — | (10,559 | ) | |||||||||||||||||||||||
Pro
rata share of amounts reclassified related to a nonconsolidated subsidiary | — | — | — | — | — | — | 8,622 | — | 8,622 | |||||||||||||||||||||||||
Pro
rata share of other comprehensive loss of nonconsolidated subsidiaries | — | — | — | — | — | — | (1,657 | ) | — | (1,657 | ) | |||||||||||||||||||||||
Increase
in value of interest rate swaps | — | — | — | — | — | — | 6,611 | — | 6,611 | |||||||||||||||||||||||||
Adjustments
to carry redeemable Class A units at redemption value | — | — | — | — | 286,928 | — | — | — | 286,928 | |||||||||||||||||||||||||
Redeemable
noncontrolling interests' share of above adjustments | — | — | — | — | — | — | (188 | ) | — | (188 | ) | |||||||||||||||||||||||
Other | — | — | 4 | — | (2 | ) | (46 | ) | — | (297 | ) | (345 | ) | |||||||||||||||||||||
Balance,
September 30, 2017 | 42,823 | $ | 1,038,011 | 189,878 | $ | 7,571 | $ | 7,501,823 | $ | (4,098,127 | ) | $ | 121,801 | $ | 716,494 | $ | 5,287,573 |
(Amounts
in thousands) | Additional Capital | Earnings Less
Than Distributions | Accumulated Other Comprehensive Income | Non- controlling Interests in Consolidated Subsidiaries | Total Equity | |||||||||||||||||||||||||||||
Preferred
Shares | Common Shares | |||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||||||||||||||||||||
Balance,
December 31, 2015 | 52,677 | $ | 1,276,954 | 188,577 | $ | 7,521 | $ | 7,132,979 | $ | (1,766,780 | ) | $ | 46,921 | $ | 778,483 | $ | 7,476,078 | |||||||||||||||||
Net
income attributable to Vornado | — | — | — | — | — | 239,607 | — | — | 239,607 | |||||||||||||||||||||||||
Net
income attributable to noncontrolling interests in consolidated subsidiaries | — | — | — | — | — | — | — | 26,361 | 26,361 | |||||||||||||||||||||||||
Dividends
on common shares | — | — | — | — | — | (356,863 | ) | — | — | (356,863 | ) | |||||||||||||||||||||||
Dividends
on preferred shares | — | — | — | — | — | (59,774 | ) | — | — | (59,774 | ) | |||||||||||||||||||||||
Redemption
of Series J preferred shares | (9,850 | ) | (238,842 | ) | — | — | — | (7,408 | ) | — | — | (246,250 | ) | |||||||||||||||||||||
Common
shares issued: | ||||||||||||||||||||||||||||||||||
Upon
redemption of Class A units, at redemption value | — | — | 293 | 12 | 28,114 | — | — | — | 28,126 | |||||||||||||||||||||||||
Under
employees' share option plan | — | — | 106 | 4 | 5,936 | — | — | — | 5,940 | |||||||||||||||||||||||||
Under
dividend reinvestment plan | — | — | 12 | — | 1,080 | — | — | — | 1,080 | |||||||||||||||||||||||||
Contributions | — | — | — | — | — | — | — | 19,699 | 19,699 | |||||||||||||||||||||||||
Distributions: | ||||||||||||||||||||||||||||||||||
Real
estate fund investments | — | — | — | — | — | — | — | (59,843 | ) | (59,843 | ) | |||||||||||||||||||||||
Other | — | — | — | — | — | — | — | (11,631 | ) | (11,631 | ) | |||||||||||||||||||||||
Deferred
compensation shares and options | — | — | 7 | 1 | 1,370 | (186 | ) | — | — | 1,185 | ||||||||||||||||||||||||
Increase
in unrealized net gain on available-for-sale securities | — | — | — | — | — | — | 42,798 | — | 42,798 | |||||||||||||||||||||||||
Pro
rata share of other comprehensive loss of nonconsolidated subsidiaries | — | — | — | — | — | — | (1,537 | ) | — | (1,537 | ) | |||||||||||||||||||||||
Reduction
in value of interest rate swaps | — | — | — | — | — | — | (3,482 | ) | — | (3,482 | ) | |||||||||||||||||||||||
Adjustments
to carry redeemable Class A units at redemption value | — | — | — | — | (30,260 | ) | — | — | — | (30,260 | ) | |||||||||||||||||||||||
Redeemable
noncontrolling interests' share of above adjustments | — | — | — | — | — | — | (2,326 | ) | — | (2,326 | ) | |||||||||||||||||||||||
Other | — | (1 | ) | (1 | ) | (1 | ) | 1 | (7 | ) | — | 86 | 78 | |||||||||||||||||||||
Balance,
September 30, 2016 | 42,827 | $ | 1,038,111 | 188,994 | $ | 7,537 | $ | 7,139,220 | $ | (1,951,411 | ) | $ | 82,374 | $ | 753,155 | $ | 7,068,986 |
(Amounts in thousands) | For the Nine Months Ended September 30, | ||||||
2017 | 2016 | ||||||
Cash
Flows from Operating Activities: | |||||||
Net income | $ | 210,577 | $ | 277,378 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation
and amortization (including amortization of deferred financing costs) | 407,539 | 446,040 | |||||
Return of capital from real estate fund investments | 80,294 | 71,888 | |||||
Distributions
of income from partially owned entities | 65,097 | 56,853 | |||||
Other non-cash adjustments | 43,921 | 33,971 | |||||
Straight-lining of rents | (37,752 | ) | (118,798 | ) | |||
Amortization
of below-market leases, net | (35,446 | ) | (41,676 | ) | |||
Net realized and unrealized losses (gains) on real estate fund investments | 18,537 | (16,513 | ) | ||||
Equity in net income
of partially owned entities | (6,013 | ) | (529 | ) | |||
Net gains on sale of real estate and other | (3,797 | ) | (5,074 | ) | |||
Net gains on disposition of wholly owned and partially owned
assets | (501 | ) | (160,225 | ) | |||
Real estate impairment losses | — | 161,165 | |||||
Changes in operating assets and liabilities: | |||||||
Tenant
and other receivables, net | 5,485 | 613 | |||||
Prepaid assets | (70,949 | ) | (58,998 | ) | |||
Other assets | (27,065 | ) | (64,200 | ) | |||
Accounts
payable and accrued expenses | 27,609 | 4,793 | |||||
Other liabilities | (15,911 | ) | (14,274 | ) | |||
Net cash provided by operating activities | 661,625 | 572,414 | |||||
Cash
Flows from Investing Activities: | |||||||
Distributions of capital from partially owned entities | 347,776 | 102,836 | |||||
Development costs and construction in progress | (274,716 | ) | (426,641 | ) | |||
Additions
to real estate | (207,759 | ) | (261,971 | ) | |||
Repayment of JBG SMITH Properties loan receivable | 115,630 | — | |||||
Investments in partially owned entities | (33,578 | ) | (112,797 | ) | |||
Acquisitions
of real estate and other | (11,841 | ) | (91,100 | ) | |||
Proceeds from sales of real estate and related investments | 9,543 | 167,673 | |||||
Proceeds from repayments of mortgage
loans receivable | 650 | 33 | |||||
Net deconsolidation of 7 West 34th Street | — | (48,000 | ) | ||||
Investments in loans receivable and other | — | (11,700 | ) | ||||
Purchases
of marketable securities | — | (4,379 | ) | ||||
Net cash used in investing activities | (54,295 | ) | (686,046 | ) |
(Amounts in thousands) | For the Nine Months Ended September 30, | ||||||
2017 | 2016 | ||||||
Cash
Flows from Financing Activities: | |||||||
Cash and cash equivalents and restricted cash included in the spin-off of JBG SMITH Properties ($275,000 plus The Bartlett financing proceeds less transaction costs and other mortgage items) | $ | (416,237 | ) | $ | — | ||
Dividends
paid on common shares | (382,552 | ) | (356,863 | ) | |||
Proceeds from borrowings | 229,042 | 2,000,604 | |||||
Repayments of borrowings | (177,109 | ) | (1,591,554 | ) | |||
Dividends
paid on preferred shares | (48,386 | ) | (64,006 | ) | |||
Distributions to noncontrolling interests | (48,329 | ) | (95,055 | ) | |||
Proceeds received from exercise of employee share options | 25,011 | 7,020 | |||||
Debt
issuance and other costs | (2,944 | ) | (30,846 | ) | |||
Contributions from noncontrolling interests | 1,044 | 11,900 | |||||
Repurchase of shares related to stock compensation
agreements and related tax withholdings and other | (418 | ) | (186 | ) | |||
Redemption of preferred shares | — | (246,250 | ) | ||||
Net cash used in financing activities | (820,878 | ) | (365,236 | ) | |||
Net
decrease in cash and cash equivalents and restricted cash | (213,548 | ) | (478,868 | ) | |||
Cash and cash equivalents and restricted cash at beginning of period | 1,599,331 | 1,943,515 | |||||
Cash
and cash equivalents and restricted cash at end of period | $ | 1,385,783 | $ | 1,464,647 | |||
Reconciliation of Cash and Cash Equivalents and Restricted Cash: | |||||||
Cash
and cash equivalents at beginning of period | $ | 1,501,027 | $ | 1,835,707 | |||
Restricted cash at beginning of period | 95,032 | 99,943 | |||||
Restricted
cash included in discontinued operations at beginning of period | 3,272 | 7,865 | |||||
Cash and cash equivalents and restricted cash at beginning of period | $ | 1,599,331 | $ | 1,943,515 | |||
Cash
and cash equivalents at end of period | $ | 1,282,230 | $ | 1,352,697 | |||
Restricted cash at end of period | 103,553 | 108,976 | |||||
Restricted
cash included in discontinued operations at end of period | — | 2,974 | |||||
Cash and cash equivalents and restricted cash at end of period | $ | 1,385,783 | $ | 1,464,647 | |||
Supplemental
Disclosure of Cash Flow Information: | |||||||
Cash payments for interest, excluding capitalized interest of $31,243 and $21,297 | $ | 257,173 | $ | 275,979 | |||
Cash payments for income taxes | $ | 5,292 | $ | 7,602 | |||
Non-Cash
Investing and Financing Activities: | |||||||
Non-cash distribution to JBG SMITH Properties: | |||||||
Assets | $ | 3,432,738 | $ | — | |||
Liabilities | (1,414,186 | ) | — | ||||
Equity | (2,018,552 | ) | — | ||||
Adjustments
to carry redeemable Class A units at redemption value | 286,928 | (30,260 | ) | ||||
Loan receivable established upon the spin-off of JBG SMITH Properties | 115,630 | — | |||||
Accrued
capital expenditures included in accounts payable and accrued expenses | 69,033 | 129,704 | |||||
Write-off of fully depreciated assets | (41,458 | ) | (283,496 | ) | |||
(Reduction)
increase in unrealized net gain on available-for-sale securities | (10,559 | ) | 42,798 | ||||
Decrease in assets and liabilities resulting from the deconsolidation of investments that were previously consolidated: | |||||||
Real estate, net | — | (122,047 | ) | ||||
Mortgage
payable, net | — | (290,418 | ) |
(Amounts
in thousands, except unit amounts) | |||||||
ASSETS | |||||||
Real estate, at cost: | |||||||
Land | $ | 3,124,971 | $ | 3,130,825 | |||
Buildings
and improvements | 9,824,618 | 9,684,144 | |||||
Development costs and construction in progress | 1,536,290 | 1,278,941 | |||||
Leasehold improvements and equipment | 96,820 | 93,910 | |||||
Total | 14,582,699 | 14,187,820 | |||||
Less
accumulated depreciation and amortization | (2,805,160 | ) | (2,581,514 | ) | |||
Real estate, net | 11,777,539 | 11,606,306 | |||||
Cash and cash equivalents | 1,282,230 | 1,501,027 | |||||
Restricted
cash | 103,553 | 95,032 | |||||
Marketable securities | 193,145 | 203,704 | |||||
Tenant and other receivables, net of allowance for doubtful accounts of $5,539 and
$6,708 | 54,769 | 61,069 | |||||
Investments in partially owned entities | 1,064,982 | 1,378,254 | |||||
Real estate fund investments | 351,750 | 462,132 | |||||
Receivable
arising from the straight-lining of rents, net of allowance of $1,215 and $2,227 | 917,827 | 885,167 | |||||
Deferred leasing costs, net of accumulated amortization of $186,041 and $170,952 | 354,573 | 354,997 | |||||
Identified
intangible assets, net of accumulated amortization $144,683 and $194,422 | 166,198 | 189,668 | |||||
Assets related to discontinued operations | 1,774 | 3,568,613 | |||||
Other
assets | 573,780 | 508,878 | |||||
$ | 16,842,120 | $ | 20,814,847 | ||||
LIABILITIES,
REDEEMABLE PARTNERSHIP UNITS AND EQUITY | |||||||
Mortgages payable, net | $ | 8,131,606 | $ | 8,113,248 | |||
Senior unsecured notes, net | 846,641 | 845,577 | |||||
Unsecured
term loan, net | 373,354 | 372,215 | |||||
Unsecured revolving credit facilities | — | 115,630 | |||||
Accounts payable and accrued expenses | 412,100 | 397,134 | |||||
Deferred
revenue | 240,377 | 276,276 | |||||
Deferred compensation plan | 106,244 | 121,183 | |||||
Liabilities related to discontinued operations | 3,602 | 1,259,443 | |||||
Other
liabilities | 469,919 | 417,199 | |||||
Total liabilities | 10,583,843 | 11,917,905 | |||||
Commitments and contingencies | |||||||
Redeemable
partnership units: | |||||||
Class A units - 12,555,623 and 12,197,162 units outstanding | 965,276 | 1,273,018 | |||||
Series D cumulative redeemable preferred units - 177,101 units outstanding | 5,428 | 5,428 | |||||
Total
redeemable partnership units | 970,704 | 1,278,446 | |||||
Equity: | |||||||
Partners' capital | 8,547,405 | 8,198,929 | |||||
Earnings
less than distributions | (4,098,127 | ) | (1,419,382 | ) | |||
Accumulated other comprehensive income | 121,801 | 118,972 | |||||
Total Vornado Realty L.P. equity | 4,571,079 | 6,898,519 | |||||
Noncontrolling
interests in consolidated subsidiaries | 716,494 | 719,977 | |||||
Total equity | 5,287,573 | 7,618,496 | |||||
$ | 16,842,120 | $ | 20,814,847 |
(Amounts in thousands, except per unit amounts) | For
the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
REVENUES: | |||||||||||||||
Property
rentals | $ | 432,062 | $ | 411,153 | $ | 1,275,597 | $ | 1,238,903 | |||||||
Tenant
expense reimbursements | 63,401 | 60,957 | 174,091 | 162,831 | |||||||||||
Fee and other income | 33,292 | 30,643 | 98,212 | 88,034 | |||||||||||
Total
revenues | 528,755 | 502,753 | 1,547,900 | 1,489,768 | |||||||||||
EXPENSES: | |||||||||||||||
Operating | 225,226 | 213,762 | 661,585 | 626,546 | |||||||||||
Depreciation
and amortization | 104,972 | 105,877 | 315,223 | 316,383 | |||||||||||
General and administrative | 36,261 | 33,584 | 122,161 | 112,593 | |||||||||||
Acquisition
and transaction related costs | 61 | 1,069 | 1,073 | 6,697 | |||||||||||
Total expenses | 366,520 | 354,292 | 1,100,042 | 1,062,219 | |||||||||||
Operating
income | 162,235 | 148,461 | 447,858 | 427,549 | |||||||||||
(Loss) income from partially owned entities | (41,801 | ) | 3,811 | 5,578 | 3,892 | ||||||||||
(Loss)
income from real estate fund investments | (6,308 | ) | 1,077 | (1,649 | ) | 28,750 | |||||||||
Interest and other investment income, net | 9,306 | 6,459 | 27,800 | 20,121 | |||||||||||
Interest
and debt expense | (85,068 | ) | (79,721 | ) | (252,581 | ) | (250,034 | ) | |||||||
Net gains on disposition of wholly owned and partially owned assets | — | — | 501 | 160,225 | |||||||||||
Income
before income taxes | 38,364 | 80,087 | 227,507 | 390,503 | |||||||||||
Income tax expense | (1,188 | ) | (4,563 | ) | (2,429 | ) | (8,921 | ) | |||||||
Income
from continuing operations | 37,176 | 75,524 | 225,078 | 381,582 | |||||||||||
(Loss) income from discontinued operations | (47,930 | ) | 25,080 | (14,501 | ) | (104,204 | ) | ||||||||
Net
(loss) income | (10,754 | ) | 100,604 | 210,577 | 277,378 | ||||||||||
Less net income attributable to noncontrolling interests in consolidated subsidiaries | (4,022 | ) | (3,658 | ) | (18,436 | ) | (26,361 | ) | |||||||
Net
(loss) income attributable to Vornado Realty L.P. | (14,776 | ) | 96,946 | 192,141 | 251,017 | ||||||||||
Preferred unit distributions | (16,176 | ) | (19,096 | ) | (48,531 | ) | (59,920 | ) | |||||||
Preferred
unit issuance costs (Series J redemption) | — | (7,408 | ) | — | (7,408 | ) | |||||||||
NET (LOSS) INCOME attributable to Class A unitholders | $ | (30,952 | ) | $ | 70,442 | $ | 143,610 | $ | 183,689 | ||||||
(LOSS)
INCOME PER CLASS A UNIT – BASIC: | |||||||||||||||
Income from continuing operations, net | $ | 0.08 | $ | 0.22 | $ | 0.77 | $ | 1.43 | |||||||
(Loss)
income from discontinued operations, net | (0.24 | ) | 0.13 | (0.07 | ) | (0.52 | ) | ||||||||
Net (loss) income per Class A unit | $ | (0.16 | ) | $ | 0.35 | $ | 0.70 | $ | 0.91 | ||||||
Weighted
average units outstanding | 201,300 | 200,458 | 201,093 | 200,300 | |||||||||||
(LOSS)
INCOME PER CLASS A UNIT – DILUTED: | |||||||||||||||
Income from continuing operations, net | $ | 0.08 | $ | 0.22 | $ | 0.76 | $ | 1.42 | |||||||
(Loss)
income from discontinued operations, net | (0.24 | ) | 0.13 | (0.07 | ) | (0.52 | ) | ||||||||
Net (loss) income per Class A unit | $ | (0.16 | ) | $ | 0.35 | $ | 0.69 | $ | 0.90 | ||||||
Weighted
average units outstanding | 203,113 | 202,141 | 203,311 | 201,932 | |||||||||||
DISTRIBUTIONS
PER CLASS A UNIT | $ | 0.60 | $ | 0.63 | $ | 2.02 | $ | 1.89 |
(Amounts in thousands) | For
the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Net (loss) income | $ | (10,754 | ) | $ | 100,604 | $ | 210,577 | $ | 277,378 | ||||||
Other
comprehensive income (loss): | |||||||||||||||
Increase (reduction) in unrealized net gain on available-for-sale securities | 5,656 | 3,685 | (10,559 | ) | 42,798 | ||||||||||
Pro
rata share of amounts reclassified from accumulated other comprehensive income of a nonconsolidated subsidiary | (646 | ) | — | 8,622 | — | ||||||||||
Pro rata share of other comprehensive
loss of nonconsolidated subsidiaries | (626 | ) | (915 | ) | (1,657 | ) | (1,537 | ) | |||||||
Increase (reduction) in value of interest rate swaps and other | 1,973 | 7,689 | 6,611 | (3,482 | ) | ||||||||||
Comprehensive
(loss) income | (4,397 | ) | 111,063 | 213,594 | 315,157 | ||||||||||
Less comprehensive income attributable to noncontrolling interests in consolidated subsidiaries | (4,022 | ) | (3,658 | ) | (18,436 | ) | (26,361 | ) | |||||||
Comprehensive
(loss) income attributable to Vornado L.P. | $ | (8,419 | ) | $ | 107,405 | $ | 195,158 | $ | 288,796 |
(Amounts
in thousands) | ||||||||||||||||||||||||||||||
Preferred
Units | Class A Units Owned by Vornado | Earnings Less Than Distributions | Accumulated Other Comprehensive Income | Non- controlling Interests
in Consolidated Subsidiaries | Total Equity | |||||||||||||||||||||||||
Units | Amount | Units | Amount | |||||||||||||||||||||||||||
Balance,
December 31, 2016 | 42,825 | $ | 1,038,055 | 189,101 | $ | 7,160,874 | $ | (1,419,382 | ) | $ | 118,972 | $ | 719,977 | $ | 7,618,496 | |||||||||||||||
Net
income attributable to Vornado Realty L.P. | — | — | — | — | 192,141 | — | — | 192,141 | ||||||||||||||||||||||
Net
income attributable to redeemable partnership units | — | — | — | — | (9,057 | ) | — | — | (9,057 | ) | ||||||||||||||||||||
Net
income attributable to noncontrolling interests in consolidated subsidiaries | — | — | — | — | — | — | 18,436 | 18,436 | ||||||||||||||||||||||
Distributions
to Vornado | — | — | — | — | (382,552 | ) | — | — | (382,552 | ) | ||||||||||||||||||||
Distributions
to preferred unitholders | — | — | — | — | (48,386 | ) | — | — | (48,386 | ) | ||||||||||||||||||||
Class
A Units issued to Vornado: | ||||||||||||||||||||||||||||||
Upon
redemption of redeemable Class A units, at redemption value | — | — | 349 | 34,564 | — | — | — | 34,564 | ||||||||||||||||||||||
Under
Vornado's employees' share option plan | — | — | 409 | 23,892 | — | — | — | 23,892 | ||||||||||||||||||||||
Under
Vornado's dividend reinvestment plan | — | — | 12 | 1,119 | — | — | — | 1,119 | ||||||||||||||||||||||
Contributions | — | — | — | — | — | — | 1,044 | 1,044 | ||||||||||||||||||||||
Distributions: | ||||||||||||||||||||||||||||||
JBG
SMITH Properties | — | — | — | — | (2,430,427 | ) | — | — | (2,430,427 | ) | ||||||||||||||||||||
Real
estate fund investments | — | — | — | — | — | — | (20,851 | ) | (20,851 | ) | ||||||||||||||||||||
Other | — | — | — | — | — | — | (1,815 | ) | (1,815 | ) | ||||||||||||||||||||
Conversion
of Series A preferred units to Class A units | (2 | ) | (44 | ) | 2 | 44 | — | — | — | — | ||||||||||||||||||||
Deferred
compensation units and options | — | — | 1 | 1,975 | (418 | ) | — | — | 1,557 | |||||||||||||||||||||
Reduction
in unrealized net gain on available-for-sale securities | — | — | — | — | — | (10,559 | ) | — | (10,559 | ) | ||||||||||||||||||||
Pro
rata share of amounts reclassified related to a nonconsolidated subsidiary | — | — | — | — | — | 8,622 | — | 8,622 | ||||||||||||||||||||||
Pro
rata share of other comprehensive loss of nonconsolidated subsidiaries | — | — | — | — | — | (1,657 | ) | — | (1,657 | ) | ||||||||||||||||||||
Increase
in value of interest rate swaps | — | — | — | — | — | 6,611 | — | 6,611 | ||||||||||||||||||||||
Adjustments
to carry redeemable Class A units at redemption value | — | — | — | 286,928 | — | — | — | 286,928 | ||||||||||||||||||||||
Redeemable
partnership units' share of above adjustments | — | — | — | — | — | (188 | ) | — | (188 | ) | ||||||||||||||||||||
Other | — | — | 4 | (2 | ) | (46 | ) | — | (297 | ) | (345 | ) | ||||||||||||||||||
Balance,
September 30, 2017 | 42,823 | $ | 1,038,011 | 189,878 | $ | 7,509,394 | $ | (4,098,127 | ) | $ | 121,801 | $ | 716,494 | $ | 5,287,573 |
(Amounts
in thousands) | ||||||||||||||||||||||||||||||
Preferred
Units | Class A Units Owned by Vornado | Earnings Less Than Distributions | Accumulated Other Comprehensive Income | Non- controlling Interests
in Consolidated Subsidiaries | Total Equity | |||||||||||||||||||||||||
Units | Amount | Units | Amount | |||||||||||||||||||||||||||
Balance,
December 31, 2015 | 52,677 | $ | 1,276,954 | 188,577 | $ | 7,140,500 | $ | (1,766,780 | ) | $ | 46,921 | $ | 778,483 | $ | 7,476,078 | |||||||||||||||
Net
income attributable to Vornado Realty L.P. | — | — | — | — | 251,017 | — | — | 251,017 | ||||||||||||||||||||||
Net
income attributable to redeemable partnership units | — | — | — | — | (11,410 | ) | — | — | (11,410 | ) | ||||||||||||||||||||
Net
income attributable to noncontrolling interests in consolidated subsidiaries | — | — | — | — | — | — | 26,361 | 26,361 | ||||||||||||||||||||||
Distributions
to Vornado | — | — | — | — | (356,863 | ) | — | — | (356,863 | ) | ||||||||||||||||||||
Distributions
to preferred unitholders | — | — | — | — | (59,774 | ) | — | — | (59,774 | ) | ||||||||||||||||||||
Redemption
of Series J preferred units | (9,850 | ) | (238,842 | ) | — | — | (7,408 | ) | — | — | (246,250 | ) | ||||||||||||||||||
Class
A Units issued to Vornado: | ||||||||||||||||||||||||||||||
Upon
redemption of redeemable Class A units, at redemption value | — | — | 293 | 28,126 | — | — | — | 28,126 | ||||||||||||||||||||||
Under
Vornado's employees' share option plan | — | — | 106 | 5,940 | — | — | — | 5,940 | ||||||||||||||||||||||
Under
Vornado's dividend reinvestment plan | — | — | 12 | 1,080 | — | — | — | 1,080 | ||||||||||||||||||||||
Contributions | — | — | — | — | — | — | 19,699 | 19,699 | ||||||||||||||||||||||
Distributions: | ||||||||||||||||||||||||||||||
Real
estate fund investments | — | — | — | — | — | — | (59,843 | ) | (59,843 | ) | ||||||||||||||||||||
Other | — | — | — | — | — | — | (11,631 | ) | (11,631 | ) | ||||||||||||||||||||
Deferred
compensation units and options | — | — | 7 | 1,371 | (186 | ) | — | — | 1,185 | |||||||||||||||||||||
Increase
in unrealized net gain on available-for-sale securities | — | — | — | — | — | 42,798 | — | 42,798 | ||||||||||||||||||||||
Pro
rata share of other comprehensive loss of nonconsolidated subsidiaries | — | — | — | — | — | (1,537 | ) | — | (1,537 | ) | ||||||||||||||||||||
Reduction
in value of interest rate swaps | — | — | — | — | — | (3,482 | ) | — | (3,482 | ) | ||||||||||||||||||||
Adjustments
to carry redeemable Class A units at redemption value | — | — | — | (30,260 | ) | — | — | — | (30,260 | ) | ||||||||||||||||||||
Redeemable
partnership units' share of above adjustments | — | — | — | — | — | (2,326 | ) | — | (2,326 | ) | ||||||||||||||||||||
Other | — | (1 | ) | (1 | ) | — | (7 | ) | — | 86 | 78 | |||||||||||||||||||
Balance,
September 30, 2016 | 42,827 | $ | 1,038,111 | 188,994 | $ | 7,146,757 | $ | (1,951,411 | ) | $ | 82,374 | $ | 753,155 | $ | 7,068,986 |
(Amounts in thousands) | For the Nine Months Ended September 30, | ||||||
2017 | 2016 | ||||||
Cash
Flows from Operating Activities: | |||||||
Net income | $ | 210,577 | $ | 277,378 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation
and amortization (including amortization of deferred financing costs) | 407,539 | 446,040 | |||||
Return of capital from real estate fund investments | 80,294 | 71,888 | |||||
Distributions
of income from partially owned entities | 65,097 | 56,853 | |||||
Other non-cash adjustments | 43,921 | 33,971 | |||||
Straight-lining of rents | (37,752 | ) | (118,798 | ) | |||
Amortization
of below-market leases, net | (35,446 | ) | (41,676 | ) | |||
Net realized and unrealized losses (gains) on real estate fund investments | 18,537 | (16,513 | ) | ||||
Equity in net income
of partially owned entities | (6,013 | ) | (529 | ) | |||
Net gains on sale of real estate and other | (3,797 | ) | (5,074 | ) | |||
Net gains on disposition of wholly owned and partially owned
assets | (501 | ) | (160,225 | ) | |||
Real estate impairment losses | — | 161,165 | |||||
Changes in operating assets and liabilities: | |||||||
Tenant
and other receivables, net | 5,485 | 613 | |||||
Prepaid assets | (70,949 | ) | (58,998 | ) | |||
Other assets | (27,065 | ) | (64,200 | ) | |||
Accounts
payable and accrued expenses | 27,609 | 4,793 | |||||
Other liabilities | (15,911 | ) | (14,274 | ) | |||
Net cash provided by operating activities | 661,625 | 572,414 | |||||
Cash
Flows from Investing Activities: | |||||||
Distributions of capital from partially owned entities | 347,776 | 102,836 | |||||
Development costs and construction in progress | (274,716 | ) | (426,641 | ) | |||
Additions
to real estate | (207,759 | ) | (261,971 | ) | |||
Repayment of JBG SMITH Properties loan receivable | 115,630 | — | |||||
Investments in partially owned entities | (33,578 | ) | (112,797 | ) | |||
Acquisitions
of real estate and other | (11,841 | ) | (91,100 | ) | |||
Proceeds from sales of real estate and related investments | 9,543 | 167,673 | |||||
Proceeds from repayments of mortgage
loans receivable | 650 | 33 | |||||
Net deconsolidation of 7 West 34th Street | — | (48,000 | ) | ||||
Investments in loans receivable and other | — | (11,700 | ) | ||||
Purchases
of marketable securities | — | (4,379 | ) | ||||
Net cash used in investing activities | (54,295 | ) | (686,046 | ) |
(Amounts in thousands) | For the Nine Months Ended September 30, | ||||||
2017 | 2016 | ||||||
Cash
Flows from Financing Activities: | |||||||
Cash and cash equivalents and restricted cash included in the spin-off of JBG SMITH Properties ($275,000 plus The Bartlett financing proceeds less transaction costs and other mortgage items) | $ | (416,237 | ) | $ | — | ||
Distributions
to Vornado | (382,552 | ) | (356,863 | ) | |||
Proceeds from borrowings | 229,042 | 2,000,604 | |||||
Repayments of borrowings | (177,109 | ) | (1,591,554 | ) | |||
Distributions
to preferred unitholders | (48,386 | ) | (64,006 | ) | |||
Distributions to redeemable security holders and noncontrolling interests in consolidated subsidiaries | (48,329 | ) | (95,055 | ) | |||
Proceeds
received from exercise of Vornado stock options | 25,011 | 7,020 | |||||
Debt issuance and other costs | (2,944 | ) | (30,846 | ) | |||
Contributions from noncontrolling interests
in consolidated subsidiaries | 1,044 | 11,900 | |||||
Repurchase of Class A units related to stock compensation agreements and related tax withholdings and other | (418 | ) | (186 | ) | |||
Redemption
of preferred units | — | (246,250 | ) | ||||
Net cash used in financing activities | (820,878 | ) | (365,236 | ) | |||
Net decrease in cash and cash equivalents and restricted cash | (213,548 | ) | (478,868 | ) | |||
Cash
and cash equivalents and restricted cash at beginning of period | 1,599,331 | 1,943,515 | |||||
Cash and cash equivalents and restricted cash at end of period | $ | 1,385,783 | $ | 1,464,647 | |||
Reconciliation
of Cash and Cash Equivalents and Restricted Cash: | |||||||
Cash and cash equivalents at beginning of period | $ | 1,501,027 | $ | 1,835,707 | |||
Restricted cash at beginning of period | 95,032 | 99,943 | |||||
Restricted
cash included in discontinued operations at beginning of period | 3,272 | 7,865 | |||||
Cash and cash equivalents and restricted cash at beginning of period | $ | 1,599,331 | $ | 1,943,515 | |||
Cash
and cash equivalents at end of period | $ | 1,282,230 | $ | 1,352,697 | |||
Restricted cash at end of period | 103,553 | 108,976 | |||||
Restricted
cash included in discontinued operations at end of period | — | 2,974 | |||||
Cash and cash equivalents and restricted cash at end of period | $ | 1,385,783 | $ | 1,464,647 | |||
Supplemental
Disclosure of Cash Flow Information: | |||||||
Cash payments for interest, excluding capitalized interest of $31,243 and $21,297 | $ | 257,173 | $ | 275,979 | |||
Cash payments for income taxes | $ | 5,292 | $ | 7,602 | |||
Non-Cash
Investing and Financing Activities: | |||||||
Non-cash distribution to JBG SMITH Properties: | |||||||
Assets | $ | 3,432,738 | $ | — | |||
Liabilities | (1,414,186 | ) | — | ||||
Equity | (2,018,552 | ) | — | ||||
Adjustments
to carry redeemable Class A units at redemption value | 286,928 | (30,260 | ) | ||||
Loan receivable established upon the spin-off of JBG SMITH Properties | 115,630 | — | |||||
Accrued
capital expenditures included in accounts payable and accrued expenses | 69,033 | 129,704 | |||||
Write-off of fully depreciated assets | (41,458 | ) | (283,496 | ) | |||
(Reduction)
increase in unrealized net gain on available-for-sale securities | (10,559 | ) | 42,798 | ||||
Decrease in assets and liabilities resulting from the deconsolidation of investments that were previously consolidated: | |||||||
Real estate, net | — | (122,047 | ) | ||||
Mortgage
payable, net | — | (290,418 | ) |
1. | Organization
|
2. | Basis
of Presentation |
3. | Recently
Issued Accounting Literature |
3. | Recently Issued Accounting Literature - continued |
4. | Real Estate Fund Investments |
(Amounts
in thousands) | For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
Net
investment income | $ | 6,028 | $ | 5,841 | $ | 16,888 | $ | 12,237 | ||||||||
Net
realized gains on exited investments | 35,620 | — | 35,861 | 14,676 | ||||||||||||
Previously recorded unrealized gains on exited investment | (36,736 | ) | — | (25,538 | ) | (14,254 | ) | |||||||||
Net
unrealized (loss) gain on held investments | (11,220 | ) | (4,764 | ) | (28,860 | ) | 16,091 | |||||||||
(Loss) income from real estate fund investments | (6,308 | ) | 1,077 | (1,649 | ) | 28,750 | ||||||||||
Less
income attributable to noncontrolling interests in consolidated subsidiaries | (1,486 | ) | (270 | ) | (9,684 | ) | (15,088 | ) | ||||||||
(Loss) income from real estate fund investments attributable
to the Operating Partnership (1) | (7,794 | ) | 807 | (11,333 | ) | 13,662 | ||||||||||
Less loss (income) attributable to noncontrolling
interests in the Operating Partnership | 485 | (49 | ) | 706 | (843 | ) | ||||||||||
(Loss) income from real estate fund investments attributable to Vornado | $ | (7,309 | ) | $ | 758 | $ | (10,627 | ) | $ | 12,819 |
(1) | Excludes
$744 and $804 of management and leasing fees for the three months ended September 30, 2017 and 2016, respectively, and $3,125 and $2,499 for the nine months ended September 30, 2017 and 2016, respectively, which are included as a component of "fee and other income" on our consolidated statements of income. |
5. | Marketable
Securities |
(Amounts
in thousands) | As of September 30, 2017 | As of December 31, 2016 | |||||||||||||||||||||
Fair Value | GAAP Cost | Unrealized Gain | Fair Value | GAAP
Cost | Unrealized Gain | ||||||||||||||||||
Equity securities: | |||||||||||||||||||||||
Lexington
Realty Trust | $ | 188,753 | $ | 72,549 | $ | 116,204 | $ | 199,465 | $ | 72,549 | $ | 126,916 | |||||||||||
Other | 4,392 | 650 | 3,742 | 4,239 | 650 | 3,589 | |||||||||||||||||
$ | 193,145 | $ | 73,199 | $ | 119,946 | $ | 203,704 | $ | 73,199 | $ | 130,505 |
6. | Investments in Partially Owned Entities |
6. | Investments in Partially Owned Entities
- continued |
6. | Investments in Partially Owned Entities - continued |
(Amounts
in thousands) | Percentage Ownership at | Balance as of | ||||||||
Investments: | ||||||||||
Partially
owned office buildings/land (1) | Various | $ | 542,778 | $ | 734,536 | |||||
Alexander’s | 32.4% | 125,632 | 129,324 | |||||||
PREIT | 8.0% | 66,477 | 122,883 | |||||||
UE | 4.5% | 46,542 | 24,523 | |||||||
Other
investments (2) | Various | 283,553 | 366,988 | |||||||
$ | 1,064,982 | $ | 1,378,254 | |||||||
330
Madison Avenue(3) | 25.0% | $ | (53,237 | ) | $ | — | ||||
7 West 34th Street (4) | 53.0% | (46,013 | ) | (43,022 | ) | |||||
$ | (99,250 | ) | $ | (43,022 | ) |
(1) | Includes
interests in 280 Park Avenue, 650 Madison Avenue, One Park Avenue, 666 Fifth Avenue (Office), 330 Madison Avenue (2016 only - see (3) below), 512 West 22nd Street, 85 Tenth Avenue, 61 Ninth Avenue and others. |
(2) | Includes interests in Independence Plaza, Fashion Centre Mall/Washington Tower, Rosslyn Plaza, 50-70 West 93rd Street, Moynihan Office Building, Toys (which has a carrying amount of zero), and others. |
(3) | Our negative basis resulted from a refinancing distribution and is included in "other liabilities"
on our consolidated balance sheets as of September 30, 2017. |
(4) | Our negative basis results from a deferred gain from the sale of a 47.0% ownership interest in the property and is included in "other liabilities" on our consolidated balance sheets. |
6. | Investments
in Partially Owned Entities - continued |
(Amounts in thousands) | Percentage Ownership at September
30, 2017 | For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||||
Our
share of net (loss) income: | ||||||||||||||||||
PREIT (see page 23 for details): | ||||||||||||||||||
Non-cash
impairment loss | 8.0% | $ | (44,465 | ) | $ | — | $ | (44,465 | ) | $ | — | |||||||
Equity
in net earnings | (5,283 | ) | 52 | (9,015 | ) | (4,763 | ) | |||||||||||
(49,748 | ) | 52 | (53,480 | ) | (4,763 | ) | ||||||||||||
Alexander's
(see page 23 for details): | ||||||||||||||||||
Equity in net earnings | 32.4% | 6,510 | 6,891 | 20,092 | 20,640 | |||||||||||||
Management,
leasing and development fees | 1,335 | 1,894 | 4,351 | 5,307 | ||||||||||||||
7,845 | 8,785 | 24,443 | 25,947 | |||||||||||||||
UE
(see page 23 for details): | ||||||||||||||||||
Net gain resulting from UE operating partnership unit issuances | 4.5% | 5,200 | — | 21,100 | — | |||||||||||||
Equity
in net earnings | 708 | 1,949 | 4,693 | 3,896 | ||||||||||||||
Management
fees | 100 | 209 | 518 | 627 | ||||||||||||||
6,008 | 2,158 | 26,311 | 4,523 | |||||||||||||||
Partially
owned office buildings/land(1) | Various | (5,551 | ) | (8,642 | ) | (23,508 | ) | (29,882 | ) | |||||||||
Other
investments(2) | Various | (355 | ) | 1,458 | 31,812 | 8,067 | ||||||||||||
$ | (41,801 | ) | $ | 3,811 | $ | 5,578 | $ | 3,892 |
(1) | Includes
interests in 280 Park Avenue, 650 Madison Avenue, One Park Avenue, 666 Fifth Avenue (Office), 7 West 34th Street, 330 Madison Avenue, 512 West 22nd Street, 85 Tenth Avenue and others. |
(2) | Includes interests in Independence Plaza, Fashion Centre Mall/Washington Tower, Rosslyn Plaza, 50-70 West 93rd Street, Toys, and others. In the second quarter of 2017, we recognized $26,687 of net gains, comprised of $15,314 representing our share of a net gain on the sale of Suffolk Downs and $11,373 representing the net gain on repayment of our debt investments in Suffolk Downs JV. See page 24 for details. |
7. | Dispositions |
7. | Dispositions - continued |
(Amounts in thousands) | Balance as of | ||||||
Assets related to discontinued operations: | |||||||
Real estate, net | $ | — | $ | 3,222,720 | |||
Other
assets | 1,774 | 345,893 | |||||
$ | 1,774 | $ | 3,568,613 | ||||
Liabilities
related to discontinued operations: | |||||||
Mortgages payable, net | $ | — | $ | 1,165,015 | |||
Other liabilities | 3,602 | 94,428 | |||||
$ | 3,602 | $ | 1,259,443 |
(Amounts
in thousands) | For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
(Loss)
income from discontinued operations: | |||||||||||||||
Total revenues | $ | 25,747 | $ | 134,912 | $ | 260,969 | $ | 392,108 | |||||||
Total
expenses | 21,708 | 109,506 | 211,930 | 331,377 | |||||||||||
4,039 | 25,406 | 49,039 | 60,731 | ||||||||||||
JBG
SMITH Properties spin-off transaction costs | (53,581 | ) | (2,739 | ) | (67,045 | ) | (4,597 | ) | |||||||
Net gains on sale of real estate and a lease position | 1,530 | 2,864 | 3,797 | 5,074 | |||||||||||
Income
(loss) from partially owned assets | 93 | 316 | 435 | (3,363 | ) | ||||||||||
Impairment losses | — | (465 | ) | — | (161,165 | ) | |||||||||
Pretax
(loss) income from discontinued operations | (47,919 | ) | 25,382 | (13,774 | ) | (103,320 | ) | ||||||||
Income tax expense | (11 | ) | (302 | ) | (727 | ) | (884 | ) | |||||||
(Loss)
income from discontinued operations | $ | (47,930 | ) | $ | 25,080 | $ | (14,501 | ) | $ | (104,204 | ) |
(Amounts
in thousands) | For the Nine Months Ended September 30, | |||||||
2017 | 2016 | |||||||
Cash flows related to discontinued operations: | ||||||||
Cash
flows from operating activities | $ | 39,581 | $ | 107,797 | ||||
Cash flows from investing activities | (48,377 | ) | (176,374 | ) |
8. | Identified Intangible Assets and Liabilities |
(Amounts in thousands) | Balance as of | ||||||
Identified
intangible assets: | |||||||
Gross amount | $ | 310,881 | $ | 384,090 | |||
Accumulated amortization | (144,683 | ) | (194,422 | ) | |||
Total,
net | $ | 166,198 | $ | 189,668 | |||
Identified intangible liabilities (included in deferred revenue): | |||||||
Gross amount | $ | 544,956 | $ | 550,454 | |||
Accumulated
amortization | (326,661 | ) | (298,238 | ) | |||
Total, net | $ | 218,295 | $ | 252,216 |
(Amounts in thousands) | |||||
2018 | $ | 42,556 | |||
2019 | 30,820 | ||||
2020 | 22,185 | ||||
2021 | 17,370 | ||||
2022 | 14,271 |
(Amounts in thousands) | |||||
2018 | $ | 19,510 | |||
2019 | 15,229 | ||||
2020 | 12,020 | ||||
2021 | 11,041 | ||||
2022 | 9,433 |
(Amounts in thousands) | |||||
2018 | $ | 1,747 | |||
2019 | 1,747 | ||||
2020 | 1,747 | ||||
2021 | 1,747 | ||||
2022 | 1,747 |
9. | Debt |
(Amounts
in thousands) | Balance as of | ||||||||
Interest Rate at September 30, 2017 | |||||||||
Mortgages Payable: | |||||||||
Fixed
rate | 3.65% | $ | 5,466,886 | $ | 5,479,547 | ||||
Variable rate | 3.12% | 2,737,877 | 2,727,133 | ||||||
Total | 3.47% | 8,204,763 | 8,206,680 | ||||||
Deferred
financing costs, net and other | (73,157 | ) | (93,432 | ) | |||||
Total, net | $ | 8,131,606 | $ | 8,113,248 | |||||
Unsecured
Debt: | |||||||||
Senior unsecured notes | 3.68% | $ | 850,000 | $ | 850,000 | ||||
Deferred
financing costs, net and other | (3,359 | ) | (4,423 | ) | |||||
Senior unsecured notes, net | 846,641 | 845,577 | |||||||
Unsecured
term loan | 2.39% | 375,000 | 375,000 | ||||||
Deferred financing costs, net and other | (1,646 | ) | (2,785 | ) | |||||
Unsecured
term loan, net | 373,354 | 372,215 | |||||||
Unsecured
revolving credit facilities | —% | — | 115,630 | ||||||
Total,
net | $ | 1,219,995 | $ | 1,333,422 |
10. | Redeemable Noncontrolling Interests/Redeemable Partnership Units |
(Amounts in thousands) | |||||
Balance as of December 31,
2015 | $ | 1,229,221 | |||
Net income | 11,410 | ||||
Other comprehensive income | 2,326 | ||||
Distributions | (23,582 | ) | |||
Redemption
of Class A units for common shares/units, at redemption value | (28,126 | ) | |||
Adjustments to carry redeemable Class A units at redemption value | 30,260 | ||||
Other, net | 26,814 | ||||
Balance
as of September 30, 2016 | $ | 1,248,323 | |||
Balance as of December 31, 2016 | $ | 1,278,446 | |||
Net
income | 9,057 | ||||
Other comprehensive income | 188 | ||||
Distributions | (25,663 | ) | |||
Redemption
of Class A units for common shares/units, at redemption value | (34,564 | ) | |||
Adjustments to carry redeemable Class A units at redemption value (including $224,069 attributable to the spin-off of JBGS) | (286,928 | ) | |||
Other, net | 30,168 | ||||
Balance
as of September 30, 2017 | $ | 970,704 |
11. | Accumulated Other Comprehensive Income ("AOCI") |
(Amounts in thousands) | Total | Securities available- for-sale | Pro
rata share of nonconsolidated subsidiaries' OCI | Interest rate swaps | Other | ||||||||||||||
For the Three Months Ended September 30, 2017 | |||||||||||||||||||
Balance
as of June 30, 2017 | $ | 115,839 | $ | 114,290 | $ | (3,821 | ) | $ | 12,702 | $ | (7,332 | ) | |||||||
OCI
before reclassifications | 6,608 | 5,656 | (626 | ) | 1,976 | (398 | ) | ||||||||||||
Amounts
reclassified from AOCI | (646 | ) | — | (646 | ) | (1) | — | — | |||||||||||
Net
current period OCI | 5,962 | 5,656 | (1,272 | ) | 1,976 | (398 | ) | ||||||||||||
Balance
as of September 30, 2017 | $ | 121,801 | $ | 119,946 | $ | (5,093 | ) | $ | 14,678 | $ | (7,730 | ) | |||||||
For
the Three Months Ended September 30, 2016 | |||||||||||||||||||
Balance as of June 30, 2016 | $ | 72,556 | $ | 117,561 | $ | (9,941 | ) | $ | (30,538 | ) | $ | (4,526 | ) | ||||||
OCI
before reclassifications | 9,818 | 3,685 | (915 | ) | 7,688 | (640 | ) | ||||||||||||
Amounts
reclassified from AOCI | — | — | — | — | — | ||||||||||||||
Net
current period OCI | 9,818 | 3,685 | (915 | ) | 7,688 | (640 | ) | ||||||||||||
Balance
as of September 30, 2016 | $ | 82,374 | $ | 121,246 | $ | (10,856 | ) | $ | (22,850 | ) | $ | (5,166 | ) | ||||||
For
the Nine Months Ended September 30, 2017 | |||||||||||||||||||
Balance as of December 31, 2016 | $ | 118,972 | $ | 130,505 | $ | (12,058 | ) | $ | 8,066 | $ | (7,541 | ) | |||||||
OCI
before reclassifications | (5,793 | ) | (10,559 | ) | (1,657 | ) | 6,612 | (189 | ) | ||||||||||
Amounts
reclassified from AOCI | 8,622 | — | 8,622 | (1) | — | — | |||||||||||||
Net
current period OCI | 2,829 | (10,559 | ) | 6,965 | 6,612 | (189 | ) | ||||||||||||
Balance
as of September 30, 2017 | $ | 121,801 | $ | 119,946 | $ | (5,093 | ) | $ | 14,678 | $ | (7,730 | ) | |||||||
For
the Nine Months Ended September 30, 2016 | |||||||||||||||||||
Balance as of December 31, 2015 | $ | 46,921 | $ | 78,448 | $ | (9,319 | ) | $ | (19,368 | ) | $ | (2,840 | ) | ||||||
OCI
before reclassifications | 35,453 | 42,798 | (1,537 | ) | (3,482 | ) | (2,326 | ) | |||||||||||
Amounts
reclassified from AOCI | — | — | — | — | — | ||||||||||||||
Net
current period OCI | 35,453 | 42,798 | (1,537 | ) | (3,482 | ) | (2,326 | ) | |||||||||||
Balance
as of September 30, 2016 | $ | 82,374 | $ | 121,246 | $ | (10,856 | ) | $ | (22,850 | ) | $ | (5,166 | ) |
(1) | Reclassified
upon receipt of proceeds related to the sale of an investment by a nonconsolidated subsidiary. |
12. | Variable Interest Entities ("VIEs") |
(Amounts in thousands) | As of September 30, 2017 | ||||||||||||||
Total | Level
1 | Level 2 | Level 3 | ||||||||||||
Marketable securities | $ | 193,145 | $ | 193,145 | $ | — | $ | — | |||||||
Real
estate fund investments | 351,750 | — | — | 351,750 | |||||||||||
Deferred compensation plan assets ($2,501 included in restricted cash and $103,743 in other assets) | 106,244 | 56,960 | — | 49,284 | |||||||||||
Interest
rate swaps (included in other assets) | 20,880 | — | 20,880 | — | |||||||||||
Total assets | $ | 672,019 | $ | 250,105 | $ | 20,880 | $ | 401,034 | |||||||
Mandatorily
redeemable instruments (included in other liabilities) | $ | 50,561 | $ | 50,561 | $ | — | $ | — | |||||||
Interest
rate swap (included in other liabilities) | 3,090 | — | 3,090 | — | |||||||||||
Total liabilities | $ | 53,651 | $ | 50,561 | $ | 3,090 | $ | — | |||||||
As
of December 31, 2016 | |||||||||||||||
Total | Level 1 | Level 2 | Level 3 | ||||||||||||
Marketable securities | $ | 203,704 | $ | 203,704 | $ | — | $ | — | |||||||
Real
estate fund investments | 462,132 | — | — | 462,132 | |||||||||||
Deferred compensation plan assets ($4,187 included in restricted cash and $116,996 in other assets) | 121,183 | 63,739 | — | 57,444 | |||||||||||
Interest
rate swaps (included in other assets) | 21,816 | — | 21,816 | — | |||||||||||
Total assets | $ | 808,835 | $ | 267,443 | $ | 21,816 | $ | 519,576 | |||||||
Mandatorily
redeemable instruments (included in other liabilities) | $ | 50,561 | $ | 50,561 | $ | — | $ | — | |||||||
Interest
rate swap (included in other liabilities) | 10,122 | — | 10,122 | — | |||||||||||
Total liabilities | $ | 60,683 | $ | 50,561 | $ | 10,122 | $ | — |
13. | Fair Value Measurements - continued |
Range | Weighted
Average (based on fair value of investments) | |||||||
Unobservable Quantitative Input | ||||||||
Discount
rates | 10.0% to 14.9% | 10.0% to 14.9% | 12.5% | 12.6% | ||||
Terminal capitalization rates | 4.7% to 5.8% | 4.3% to 5.8% | 5.4% | 5.3% |
(Amounts in thousands) | For the Three Months Ended September 30, | For
the Nine Months Ended September 30, | |||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Beginning balance | $ | 455,692 | $ | 524,150 | $ | 462,132 | $ | 574,761 | |||||||
Dispositions/distributions | (91,606 | ) | — | (91,606 | ) | (71,888 | ) | ||||||||
Net
unrealized (loss) gain on held investments | (11,220 | ) | (4,764 | ) | (28,860 | ) | 16,091 | ||||||||
Net realized gains on exited investments | 35,620 | — | 35,861 | 14,676 | |||||||||||
Previously
recorded unrealized gains on exited investment | (36,736 | ) | — | (25,538 | ) | (14,254 | ) | ||||||||
Other, net | — | — | (239 | ) | — | ||||||||||
Ending
balance | $ | 351,750 | $ | 519,386 | $ | 351,750 | $ | 519,386 |
13. | Fair Value Measurements - continued |
(Amounts in thousands) | For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Beginning
balance | $ | 49,849 | $ | 60,140 | $ | 57,444 | $ | 59,186 | |||||||
Purchases | 2,176 | 1,251 | 3,989 | 3,523 | |||||||||||
Sales | (3,810 | ) | (3,737 | ) | (15,922 | ) | (5,888 | ) | |||||||
Realized
and unrealized gains (losses) | 246 | (1,055 | ) | 2,151 | (743 | ) | |||||||||
Other, net | 823 | 316 | 1,622 | 837 | |||||||||||
Ending
balance | $ | 49,284 | $ | 56,915 | $ | 49,284 | $ | 56,915 |
(Amounts
in thousands) | As of September 30, 2017 | ||||||||||||||
Total | Level 1 | Level 2 | Level 3 | ||||||||||||
Investment in PREIT | $ | 65,563 | $ | 65,563 | $ | — | $ | — |
13. | Fair Value Measurements - continued |
(Amounts in thousands) | As of September 30, 2017 | As of December 31, 2016 | ||||||||||||||
Carrying Amount | Fair Value | Carrying Amount | Fair Value | |||||||||||||
Cash
equivalents | $ | 1,013,282 | $ | 1,013,282 | $ | 1,307,105 | $ | 1,307,105 | ||||||||
Debt: | ||||||||||||||||
Mortgages
payable | $ | 8,204,763 | $ | 8,223,000 | $ | 8,206,680 | $ | 8,163,000 | ||||||||
Senior
unsecured notes | 850,000 | 885,000 | 850,000 | 899,000 | ||||||||||||
Unsecured term loan | 375,000 | 375,000 | 375,000 | 375,000 | ||||||||||||
Unsecured
revolving credit facilities | — | — | 115,630 | 116,000 | ||||||||||||
Total | $ | 9,429,763 | (1) | $ | 9,483,000 | $ | 9,547,310 | (1) | $ | 9,553,000 |
14. | Stock-based Compensation |
15. | Fee and Other Income |
(Amounts
in thousands) | For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
BMS
cleaning fees | $ | 26,429 | $ | 24,532 | $ | 75,925 | $ | 68,656 | |||||||
Management
and leasing fees | 2,330 | 1,935 | 7,382 | 5,694 | |||||||||||
Lease termination fees | 991 | 1,819 | 5,947 | 7,123 | |||||||||||
Other
income | 3,542 | 2,357 | 8,958 | 6,561 | |||||||||||
$ | 33,292 | $ | 30,643 | $ | 98,212 | $ | 88,034 |
16. | Interest and Other Investment Income, Net
|
(Amounts in thousands) | For the Three Months Ended September 30, | For the Nine
Months Ended September 30, | |||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Dividends on marketable securities | $ | 3,309 | $ | 3,354 | $ | 9,923 | $ | 9,799 | |||||||
Mark-to-market
income of investments in our deferred compensation plan (1) | 1,975 | 204 | 5,233 | 2,625 | |||||||||||
Interest on loans receivable | 754 | 754 | 3,599 | 2,250 | |||||||||||
Other,
net | 3,268 | 2,147 | 9,045 | 5,447 | |||||||||||
$ | 9,306 | $ | 6,459 | $ | 27,800 | $ | 20,121 |
(1) | This
income is entirely offset by the expense resulting from the mark-to-market of the deferred compensation plan liability, which is included in "general and administrative" expense. |
17. | Interest and Debt Expense |
(Amounts
in thousands) | For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Interest
expense | $ | 89,675 | $ | 79,648 | $ | 263,037 | $ | 247,172 | |||||||
Amortization
of deferred financing costs | 7,977 | 7,906 | 24,523 | 24,372 | |||||||||||
Capitalized interest and debt expense | (12,584 | ) | (7,833 | ) | (34,979 | ) | (21,510 | ) | |||||||
$ | 85,068 | $ | 79,721 | $ | 252,581 | $ | 250,034 |
18. | (Loss) Income Per Share/(Loss) Income Per Class A Unit |
(Amounts in thousands, except per share amounts) | For
the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
Numerator: | ||||||||||||||||
Income
from continuing operations, net of income attributable to noncontrolling interests | $ | 32,050 | $ | 69,037 | $ | 196,684 | $ | 337,339 | ||||||||
(Loss)
income from discontinued operations, net of income attributable to noncontrolling interests | (44,948 | ) | 23,543 | (13,600 | ) | (97,732 | ) | |||||||||
Net
(loss) income attributable to Vornado | (12,898 | ) | 92,580 | 183,084 | 239,607 | |||||||||||
Preferred share dividends | (16,128 | ) | (19,047 | ) | (48,386 | ) | (59,774 | ) | ||||||||
Preferred
share issuance costs (Series J redemption) | — | (7,408 | ) | — | (7,408 | ) | ||||||||||
Net (loss) income attributable
to common shareholders | (29,026 | ) | 66,125 | 134,698 | 172,425 | |||||||||||
Earnings allocated to unvested participating
securities | (9 | ) | (13 | ) | (37 | ) | (43 | ) | ||||||||
Numerator for basic (loss) income per share | (29,035 | ) | 66,112 | 134,661 | 172,382 | |||||||||||
Impact
of assumed conversions: | ||||||||||||||||
Earnings allocated to Out-Performance Plan units | — | — | 195 | 96 | ||||||||||||
Numerator
for diluted (loss) income per share | $ | (29,035 | ) | $ | 66,112 | $ | 134,856 | $ | 172,478 | |||||||
Denominator: | ||||||||||||||||
Denominator
for basic (loss) income per share – weighted average shares | 189,593 | 188,901 | 189,401 | 188,778 | ||||||||||||
Effect
of dilutive securities(1): | ||||||||||||||||
Employee stock options and restricted share awards | 1,254 | 1,147 | 1,553 | 1,067 | ||||||||||||
Out-Performance
Plan units | — | — | 303 | 241 | ||||||||||||
Denominator for diluted (loss) income per share – weighted average
shares and assumed conversions | 190,847 | 190,048 | 191,257 | 190,086 | ||||||||||||
(LOSS)
INCOME PER COMMON SHARE – BASIC: | ||||||||||||||||
Income from continuing operations, net | $ | 0.09 | $ | 0.23 | $ | 0.78 | $ | 1.43 | ||||||||
(Loss)
income from discontinued operations, net | (0.24 | ) | 0.12 | (0.07 | ) | (0.52 | ) | |||||||||
Net (loss) income per common share | $ | (0.15 | ) | $ | 0.35 | $ | 0.71 | $ | 0.91 | |||||||
(LOSS)
INCOME PER COMMON SHARE – DILUTED: | ||||||||||||||||
Income from continuing operations, net | $ | 0.09 | $ | 0.23 | $ | 0.78 | $ | 1.42 | ||||||||
(Loss)
income from discontinued operations, net | (0.24 | ) | 0.12 | (0.07 | ) | (0.51 | ) | |||||||||
Net (loss) income per common share | $ | (0.15 | ) | $ | 0.35 | $ | 0.71 | $ | 0.91 |
(1) | The
effect of dilutive securities for the three months ended September 30, 2017 and 2016 excludes an aggregate of 12,413 and 12,315 weighted average common share equivalents, respectively, and 12,173 and 12,072 weighted average common share equivalents for the nine months ended September 30, 2017 and 2016 respectively, as their effect was anti-dilutive. |
18. | (Loss) Income Per Share/(Loss) Income Per Class A Unit - continued |
(Amounts in thousands, except per unit amounts) | For
the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
Numerator: | ||||||||||||||||
Income
from continuing operations, net of income attributable to noncontrolling interests | $ | 33,154 | $ | 71,866 | $ | 206,642 | $ | 355,221 | ||||||||
(Loss)
income from discontinued operations | (47,930 | ) | 25,080 | (14,501 | ) | (104,204 | ) | |||||||||
Net (loss) income attributable
to Vornado Realty L.P. | (14,776 | ) | 96,946 | 192,141 | 251,017 | |||||||||||
Preferred unit distributions | (16,176 | ) | (19,096 | ) | (48,531 | ) | (59,920 | ) | ||||||||
Preferred
unit issuance costs (Series J redemption) | — | (7,408 | ) | — | (7,408 | ) | ||||||||||
Net (loss) income attributable
to Class A unitholders | (30,952 | ) | 70,442 | 143,610 | 183,689 | |||||||||||
Earnings allocated to unvested participating
securities | (740 | ) | (589 | ) | (2,499 | ) | (2,001 | ) | ||||||||
Numerator for basic and diluted (loss) income per Class A unit | $ | (31,692 | ) | $ | 69,853 | $ | 141,111 | $ | 181,688 | |||||||
Denominator: | ||||||||||||||||
Denominator
for basic (loss) income per Class A unit – weighted average units | 201,300 | 200,458 | 201,093 | 200,300 | ||||||||||||
Effect
of dilutive securities(1): | ||||||||||||||||
Vornado stock options and restricted unit awards | 1,813 | 1,683 | 2,218 | 1,632 | ||||||||||||
Denominator
for diluted (loss) income per Class A unit – weighted average units and assumed conversions | 203,113 | 202,141 | 203,311 | 201,932 | ||||||||||||
(LOSS)
INCOME PER CLASS A UNIT – BASIC: | ||||||||||||||||
Income from continuing operations, net | $ | 0.08 | $ | 0.22 | $ | 0.77 | $ | 1.43 | ||||||||
(Loss)
income from discontinued operations, net | (0.24 | ) | 0.13 | (0.07 | ) | (0.52 | ) | |||||||||
Net (loss) income per Class A unit | $ | (0.16 | ) | $ | 0.35 | $ | 0.70 | $ | 0.91 | |||||||
(LOSS)
INCOME PER CLASS A UNIT – DILUTED: | ||||||||||||||||
Income from continuing operations, net | $ | 0.08 | $ | 0.22 | $ | 0.76 | $ | 1.42 | ||||||||
(Loss)
income from discontinued operations, net | (0.24 | ) | 0.13 | (0.07 | ) | (0.52 | ) | |||||||||
Net (loss) income per Class A unit | $ | (0.16 | ) | $ | 0.35 | $ | 0.69 | $ | 0.90 |
(1) | The
effect of dilutive securities for the three months ended September 30, 2017 and 2016 excludes an aggregate of 147 and 222 weighted average Class A unit equivalents, respectively, and 118 and 226 weighted average Class A unit equivalents for the nine months ended September 30, 2017 and 2016 respectively, as their effect was anti-dilutive. |
19. | Commitments
and Contingencies |
19. | Commitments
and Contingencies - continued |
20. | Segment
Information |
(Amounts
in thousands) | For the Three Months Ended September 30, 2017 | |||||||||||
Total | New York | Other | ||||||||||
Total revenues | $ | 528,755 | $ | 453,609 | $ | 75,146 | ||||||
Total
expenses | 366,520 | 284,976 | 81,544 | |||||||||
Operating income (loss) | 162,235 | 168,633 | (6,398 | ) | ||||||||
(Loss)
income from partially owned entities | (41,801 | ) | 1,411 | (43,212 | ) | |||||||
Loss from real estate fund investments | (6,308 | ) | — | (6,308 | ) | |||||||
Interest
and other investment income, net | 9,306 | 1,413 | 7,893 | |||||||||
Interest and debt expense | (85,068 | ) | (61,529 | ) | (23,539 | ) | ||||||
Income
(loss) before income taxes | 38,364 | 109,928 | (71,564 | ) | ||||||||
Income tax expense | (1,188 | ) | (1,087 | ) | (101 | ) | ||||||
Income
(loss) from continuing operations | 37,176 | 108,841 | (71,665 | ) | ||||||||
Loss from discontinued operations | (47,930 | ) | — | (47,930 | ) | |||||||
Net
(loss) income | (10,754 | ) | 108,841 | (119,595 | ) | |||||||
Less net income attributable to noncontrolling interests in consolidated subsidiaries | (4,022 | ) | (2,552 | ) | (1,470 | ) | ||||||
Net
(loss) income attributable to the Operating Partnership | (14,776 | ) | 106,289 | (121,065 | ) | |||||||
Interest and debt expense(2) | 113,438 | 84,907 | 28,531 | |||||||||
Depreciation
and amortization(2) | 136,621 | 104,799 | 31,822 | |||||||||
Income tax expense (2) | 1,462 | 1,182 | 280 | |||||||||
EBITDA(1) | 236,745 | 297,177 | (3) | (60,432 | ) | (4) | ||||||
Acquisition
and transaction related costs, including $53,581 for the spin-off of JBGS | 53,642 | — | 53,642 | |||||||||
Impairment loss on investment in PREIT | 44,465 | — | 44,465 | |||||||||
General
and administrative expenses less $1,975 mark-to-market of our deferred compensation plan | 35,495 | 9,479 | 26,016 | |||||||||
Non-cash adjustments for straight-line rental income and expense and amortization of acquired below and above market leases, net(2) | (23,304 | ) | (21,435 | ) | (1,869 | ) | ||||||
Our
share of net realized/unrealized losses from our real estate fund investments | 10,394 | — | 10,394 | |||||||||
Net gain resulting from UE operating partnership unit issuances | (5,200 | ) | — | (5,200 | ) | |||||||
Real
estate impairment losses(2) | 4,354 | — | 4,354 | |||||||||
Net gains on sale of real estate and other(2) | (1,547 | ) | — | (1,547 | ) | |||||||
Our
share of Alexander's EBITDA (excluding management, leasing and development fees) | (12,207 | ) | (12,207 | ) | — | |||||||
Dividends received from Alexander's | 7,030 | 7,030 | — | |||||||||
Our
share of PREIT EBITDA | (3,731 | ) | — | (3,731 | ) | |||||||
Distributions received from PREIT | 1,361 | — | 1,361 | |||||||||
Our
share of UE EBITDA (excluding management fees) | (2,513 | ) | — | (2,513 | ) | |||||||
Distributions received from UE | 1,257 | — | 1,257 | |||||||||
NOI(1) | $ | 346,241 | $ | 280,044 | (3) | $ | 66,197 | (4) |
20. | Segment Information - continued |
(Amounts in thousands) | For the Three Months Ended September 30, 2016 | |||||||||||
Total | New
York | Other | ||||||||||
Total revenues | $ | 502,753 | $ | 432,869 | $ | 69,884 | ||||||
Total
expenses | 354,292 | 280,689 | 73,603 | |||||||||
Operating income (loss) | 148,461 | 152,180 | (3,719 | ) | ||||||||
Income
(loss) from partially owned entities | 3,811 | (579 | ) | 4,390 | ||||||||
Income from real estate fund investments | 1,077 | — | 1,077 | |||||||||
Interest
and other investment income, net | 6,459 | 1,355 | 5,104 | |||||||||
Interest and debt expense | (79,721 | ) | (51,212 | ) | (28,509 | ) | ||||||
Income
(loss) before income taxes | 80,087 | 101,744 | (21,657 | ) | ||||||||
Income tax expense | (4,563 | ) | (2,356 | ) | (2,207 | ) | ||||||
Income
(loss) from continuing operations | 75,524 | 99,388 | (23,864 | ) | ||||||||
Income from discontinued operations | 25,080 | — | 25,080 | |||||||||
Net
income | 100,604 | 99,388 | 1,216 | |||||||||
Less net income attributable to noncontrolling interests in consolidated subsidiaries | (3,658 | ) | (2,985 | ) | (673 | ) | ||||||
Net
income attributable to the Operating Partnership | 96,946 | 96,403 | 543 | |||||||||
Interest and debt expense(2) | 122,979 | 66,314 | 56,665 | |||||||||
Depreciation
and amortization(2) | 172,980 | 111,731 | 61,249 | |||||||||
Income tax expense(2) | 5,102 | 2,445 | 2,657 | |||||||||
EBITDA(1) | 398,007 | 276,893 | (3) | 121,114 | (4) | |||||||
Non-cash
adjustments for straight-line rental income and expense and amortization of acquired below and above market leases, net(2) | (46,500 | ) | (35,199 | ) | (11,301 | ) | ||||||
General and administrative expenses less $204 mark-to-market of our deferred compensation plan | 40,238 | 9,783 | 30,455 | |||||||||
Net
gains on sale of real estate and other(2) | (5,386 | ) | — | (5,386 | ) | |||||||
Acquisition and transaction related costs, including $2,739 for the spin-off of JBGS | 3,808 | — | 3,808 | |||||||||
Real
estate impairment losses(2) | 1,599 | — | 1,599 | |||||||||
Our share of net realized/unrealized losses from our real estate fund investments | 99 | — | 99 | |||||||||
Our
share of Alexander's EBITDA (excluding management, leasing and development fees) | (11,506 | ) | (11,506 | ) | — | |||||||
Dividends received from Alexander's | 6,617 | 6,617 | — | |||||||||
Our
share of PREIT EBITDA | (3,070 | ) | — | (3,070 | ) | |||||||
Distributions received from PREIT | 1,342 | — | 1,342 | |||||||||
Our
share of UE EBITDA (excluding management fees) | (2,514 | ) | — | (2,514 | ) | |||||||
Distributions received from UE | 1,143 | — | 1,143 | |||||||||
NOI(1) | $ | 383,877 | $ | 246,588 | (3) | $ | 137,289 | (4) |
20. | Segment Information - continued |
(Amounts in thousands) | For the Nine Months Ended September 30, 2017 | |||||||||||
Total | New
York | Other | ||||||||||
Total revenues | $ | 1,547,900 | $ | 1,316,710 | $ | 231,190 | ||||||
Total
expenses | 1,100,042 | 845,632 | 254,410 | |||||||||
Operating income (loss) | 447,858 | 471,078 | (23,220 | ) | ||||||||
Income
(loss) from partially owned entities | 5,578 | (954 | ) | 6,532 | ||||||||
Loss from real estate fund investments | (1,649 | ) | — | (1,649 | ) | |||||||
Interest
and other investment income, net | 27,800 | 4,384 | 23,416 | |||||||||
Interest and debt expense | (252,581 | ) | (179,851 | ) | (72,730 | ) | ||||||
Net
gain on disposition of wholly owned and partially owned assets | 501 | — | 501 | |||||||||
Income (loss) before income taxes | 227,507 | 294,657 | (67,150 | ) | ||||||||
Income
tax expense | (2,429 | ) | (324 | ) | (2,105 | ) | ||||||
Income (loss) from continuing operations | 225,078 | 294,333 | (69,255 | ) | ||||||||
Loss
from discontinued operations | (14,501 | ) | — | (14,501 | ) | |||||||
Net income (loss) | 210,577 | 294,333 | (83,756 | ) | ||||||||
Less
net income attributable to noncontrolling interests in consolidated subsidiaries | (18,436 | ) | (8,041 | ) | (10,395 | ) | ||||||
Net income (loss) attributable to the Operating Partnership | 192,141 | 286,292 | (94,151 | ) | ||||||||
Interest
and debt expense(2) | 348,350 | 239,032 | 109,318 | |||||||||
Depreciation and amortization(2) | 476,406 | 328,058 | 148,348 | |||||||||
Income
tax expense(2) | 4,180 | 540 | 3,640 | |||||||||
EBITDA(1) | 1,021,077 | 853,922 | (3) | 167,155 | (4) | |||||||
General
and administrative expenses less $5,233 mark-to-market of our deferred compensation plan | 131,365 | 31,630 | 99,735 | |||||||||
Non-cash adjustments for straight-line rental income and expense and amortization of acquired below and above market leases, net(2) | (73,125 | ) | (58,797 | ) | (14,328 | ) | ||||||
Acquisition
and transaction related costs, including $67,045 for the spin-off of JBGS | 68,118 | — | 68,118 | |||||||||
Impairment loss on investment in PREIT | 44,465 | — | 44,465 | |||||||||
Net
gains on sale of real estate and other(2) | (21,507 | ) | — | (21,507 | ) | |||||||
Net gains resulting from UE operating partnership unit issuances | (21,100 | ) | — | (21,100 | ) | |||||||
Our
share of net realized/unrealized losses from our real estate fund investments | 18,802 | — | 18,802 | |||||||||
Net gain on repayment of our Suffolk Downs JV debt investments | (11,373 | ) | — | (11,373 | ) | |||||||
Real
estate impairment losses(2) | 7,572 | — | 7,572 | |||||||||
Our share of Alexander's EBITDA (excluding management, leasing and development fees) | (35,511 | ) | (35,511 | ) | — | |||||||
Dividends
received from Alexander's | 21,090 | 21,090 | — | |||||||||
Our share of PREIT EBITDA | (15,439 | ) | — | (15,439 | ) | |||||||
Distributions
received from PREIT | 3,929 | — | 3,929 | |||||||||
Our share of UE EBITDA (excluding management fees) | (9,694 | ) | — | (9,694 | ) | |||||||
Distributions
received from UE | 3,773 | — | 3,773 | |||||||||
NOI(1) | $ | 1,132,442 | $ | 812,334 | (3) | $ | 320,108 | (4) |
20. | Segment Information - continued |
(Amounts in thousands) | For the Nine Months Ended September 30, 2016 | |||||||||||
Total | New
York | Other | ||||||||||
Total revenues | $ | 1,489,768 | $ | 1,269,464 | $ | 220,304 | ||||||
Total
expenses | 1,062,219 | 818,419 | 243,800 | |||||||||
Operating income (loss) | 427,549 | 451,045 | (23,496 | ) | ||||||||
Income
(loss) from partially owned entities | 3,892 | (5,143 | ) | 9,035 | ||||||||
Income from real estate fund investments | 28,750 | — | 28,750 | |||||||||
Interest
and other investment income, net | 20,121 | 3,684 | 16,437 | |||||||||
Interest and debt expense | (250,034 | ) | (162,193 | ) | (87,841 | ) | ||||||
Net
gains on disposition of wholly owned and partially owned assets | 160,225 | 159,511 | 714 | |||||||||
Income (loss) before income taxes | 390,503 | 446,904 | (56,401 | ) | ||||||||
Income
tax expense | (8,921 | ) | (4,131 | ) | (4,790 | ) | ||||||
Income (loss) from continuing operations | 381,582 | 442,773 | (61,191 | ) | ||||||||
Loss
from discontinued operations | (104,204 | ) | — | (104,204 | ) | |||||||
Net income (loss) | 277,378 | 442,773 | (165,395 | ) | ||||||||
Less
net income attributable to noncontrolling interests in consolidated subsidiaries | (26,361 | ) | (9,811 | ) | (16,550 | ) | ||||||
Net income (loss) attributable to the Operating Partnership | 251,017 | 432,962 | (181,945 | ) | ||||||||
Interest
and debt expense(2) | 376,898 | 208,683 | 168,215 | |||||||||
Depreciation and amortization(2) | 521,143 | 331,448 | 189,695 | |||||||||
Income
tax expense(2) | 13,067 | 4,424 | 8,643 | |||||||||
EBITDA(1) | 1,162,125 | 977,517 | (3) | 184,608 | (4) | |||||||
Net
gains on sale of real estate and other(2) | (168,140 | ) | (159,511 | ) | (8,629 | ) | ||||||
Real estate impairment losses(2) | 166,701 | — | 166,701 | |||||||||
Non-cash
adjustments for straight-line rental income and expense and amortization of acquired below and above market leases, net(2) | (152,023 | ) | (114,217 | ) | (37,806 | ) | ||||||
General and administrative expenses less $2,625 mark-to-market of our deferred compensation plan | 132,085 | 27,557 | 104,528 | |||||||||
Acquisition
and transaction related costs, including $4,597 for the spin-off of JBGS | 11,319 | — | 11,319 | |||||||||
Our share of net realized/unrealized gains from our real estate fund investments | (8,741 | ) | — | (8,741 | ) | |||||||
Our
share of Alexander's EBITDA (excluding management, leasing and development fees) | (34,880 | ) | (34,880 | ) | — | |||||||
Dividends received from Alexander's | 19,849 | 19,849 | — | |||||||||
Our
share of PREIT EBITDA | (8,537 | ) | — | (8,537 | ) | |||||||
Distributions received from PREIT | 3,906 | — | 3,906 | |||||||||
Our
share of UE EBITDA (excluding management fees) | (7,539 | ) | — | (7,539 | ) | |||||||
Distributions received from UE | 3,430 | — | 3,430 | |||||||||
NOI(1) | $ | 1,119,555 | $ | 716,315 | (3) | $ | 403,240 | (4) |
20. | Segment Information - continued |
(1) | EBITDA
represents "Earnings Before Interest, Taxes, Depreciation and Amortization." NOI represents "Net Operating Income" on a cash basis. We calculate EBITDA and NOI on an Operating Partnership basis which is before allocation to the noncontrolling interest of the Operating Partnership. We consider EBITDA the primary non-GAAP financial measure for making decisions and assessing the unlevered performance of our segments as it relates to the total return on assets as opposed to the levered return on equity. We also consider NOI a key non-GAAP financial measure. NOI is before general and administrative expenses, straight-line rental income and expense, amortization of acquired below and above market leases, net, acquisition and transaction related costs, our share of net realized and unrealized gains or losses from our real estate fund investments, impairment losses and gains on disposal of assets. As properties are bought and sold based on a multiple of NOI,
we utilize this measure to make investment decisions as well as to compare the performance of our assets to those of our peers. EBITDA and NOI should not be considered substitutes for net income. EBITDA and NOI may not be comparable to similarly titled measures employed by other companies. |
(2) | Adjustments include our proportionate share of partially owned entities and give effect to noncontrolling interest's share of consolidated subsidiaries. |
20. | Segment Information - continued |
(3) | The elements of "New York" EBITDA are summarized below. |
(Amounts
in thousands) | For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||||
Office | $ | 183,162 | $ | 164,150 | (a) | $ | 522,566 | $ | 484,735 | (a) | ||||||||
Retail | 90,316 | 91,061 | (a) | 269,762 | 272,083 | (a) | ||||||||||||
Residential | 5,981 | 6,214 | 18,450 | 18,901 | ||||||||||||||
Alexander's | 12,207 | 11,506 | 35,511 | 34,880 | ||||||||||||||
Hotel
Pennsylvania | 5,511 | 3,962 | 7,633 | 4,287 | ||||||||||||||
Total
New York EBITDA, as adjusted | 297,177 | 276,893 | 853,922 | 814,886 | ||||||||||||||
Certain
items that impact EBITDA: | ||||||||||||||||||
Net gain on sale of 47% ownership interest in 7 West 34th Street | — | — | — | 159,511 | ||||||||||||||
EBITDA
from sold properties | — | — | — | 3,120 | ||||||||||||||
Total
of certain items that impact EBITDA | — | — | — | 162,631 | ||||||||||||||
Total
New York EBITDA | $ | 297,177 | $ | 276,893 | $ | 853,922 | $ | 977,517 |
(Amounts in thousands) | For the Three Months Ended September 30, | For
the Nine Months Ended September 30, | ||||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||||
Office | $ | 179,505 | $ | 157,643 | (a) | $ | 523,531 | $ | 459,509 | (a) | ||||||||
Retail | 81,839 | 72,178 | (a) | 241,667 | 211,611 | (a) | ||||||||||||
Residential | 5,418 | 5,525 | 16,300 | 16,724 | ||||||||||||||
Alexander's | 7,030 | 6,617 | 21,090 | 19,849 | ||||||||||||||
Hotel
Pennsylvania | 6,252 | 4,625 | 9,746 | 6,390 | ||||||||||||||
Total
New York NOI, as adjusted | 280,044 | 246,588 | 812,334 | 714,083 | ||||||||||||||
NOI
from sold properties | — | — | — | 2,232 | ||||||||||||||
Total
New York NOI | $ | 280,044 | $ | 246,588 | $ | 812,334 | $ | 716,315 |
(a) | Beginning
in January 2017 for office buildings with retail at the base, we have adjusted the allocation of real estate taxes between the retail and office elements above. This has no effect on our consolidated financial statements but resulted in a reallocation of $4,213 and $12,058 of income from retail to office for the three and nine months ended September 30, 2016, respectively. |
20. | Segment Information - continued |
(4) | The elements of "Other" EBITDA are summarized below. |
(Amounts
in thousands) | For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||||
theMART
(including trade shows) | $ | 24,165 | $ | 21,696 | $ | 72,471 | $ | 70,689 | |||||||||
555
California Street | 11,643 | 11,405 | 35,870 | 35,137 | |||||||||||||
Other
investments | 11,379 | 20,388 | 36,318 | 57,092 | |||||||||||||
Corporate
general and administrative expenses(a) | (22,730 | ) | (21,519 | ) | (78,952 | ) | (76,364 | ) | |||||||||
Investment
income and other, net(a) | 5,910 | 6,871 | 24,079 | 19,317 | |||||||||||||
Other
EBITDA, as adjusted | 30,367 | 38,841 | 89,786 | 105,871 | |||||||||||||
Certain
items that impact EBITDA: | |||||||||||||||||
JBGS which is treated as a discontinued operation: | |||||||||||||||||
Transaction
costs | (53,581 | ) | (2,739 | ) | (67,045 | ) | (4,597 | ) | |||||||||
Operating
results through July 17, 2017 spin-off | 13,038 | 75,307 | 153,449 | 214,604 | |||||||||||||
(40,543 | ) | 72,568 | 86,404 | 210,007 | |||||||||||||
Impairment
loss on investment in PREIT | (44,465 | ) | — | (44,465 | ) | — | |||||||||||
(Loss)
income from real estate fund investments, net | (7,794 | ) | 807 | (11,333 | ) | 13,662 | |||||||||||
Net
gain resulting from UE operating partnership unit issuances | 5,200 | — | 21,100 | — | |||||||||||||
Our
share of net gain on sale of Suffolk Downs | — | — | 15,314 | — | |||||||||||||
Net
gain on repayment of Suffolk Downs JV debt investments | — | — | 11,373 | — | |||||||||||||
Skyline
properties impairment loss | — | — | — | (160,700 | ) | ||||||||||||
Other | (3,197 | ) | 8,898 | (1,024 | ) | 15,768 | |||||||||||
Total
of certain items that impact EBITDA | (90,799 | ) | 82,273 | 77,369 | 78,737 | ||||||||||||
Other
EBITDA | $ | (60,432 | ) | $ | 121,114 | $ | 167,155 | $ | 184,608 |
(Amounts in thousands) | For the Three Months Ended September 30, | For
the Nine Months Ended September 30, | |||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||||
theMART
(including trade shows) | $ | 25,422 | $ | 21,758 | $ | 74,859 | $ | 70,914 | |||||||||
555
California Street | 11,013 | 9,899 | 33,647 | 24,010 | |||||||||||||
Other
investments | 7,589 | 21,381 | 15,138 | 44,482 | |||||||||||||
Investment
income and other, net(a) | 5,910 | 6,871 | 24,079 | 19,317 | |||||||||||||
Other
NOI, as adjusted | 49,934 | 59,909 | 147,723 | 158,723 | |||||||||||||
Certain
items that impact NOI: | |||||||||||||||||
JBGS operating results through July 17, 2017 spin-off | 12,971 | 72,919 | 160,634 | 233,310 | |||||||||||||
Our
share of real estate fund investments | 2,600 | 2,555 | 7,469 | 6,313 | |||||||||||||
Other | 692 | 1,906 | 4,282 | 4,894 | |||||||||||||
Total
of certain items that impact NOI | 16,263 | 77,380 | 172,385 | 244,517 | |||||||||||||
Other
NOI | $ | 66,197 | $ | 137,289 | $ | 320,108 | $ | 403,240 |
(a) | The
amounts in these captions (for this table only) exclude the results of the mark-to-market of our deferred compensation plan of $1,975 and $204 of income for the three months ended September 30, 2017 and 2016, respectively, and $5,233 and $2,625 of income for the nine months ended September 30, 2017 and 2016, respectively. |
21. | Subsequent Event |
Total
Return(1) | |||||||||||
Vornado | Office REIT | MSCI | |||||||||
Three-month | 2.3 | % | (0.7 | )% | 0.9 | % | |||||
Nine-month | (6.7 | )% | 1.9 | % | 3.6 | % | |||||
One-year | (3.1 | )% | 2.5 | % | 0.5 | % | |||||
Three-year | 14.0 | % | 30.3 | % | 31.9 | % | |||||
Five-year | 52.0 | % | 53.7 | % | 58.0 | % | |||||
Ten-year | 38.9 | % | 47.0 | % | 75.6 | % |
(1) | Past
performance is not necessarily indicative of future performance. |
• | maintaining a superior team of operating and investment professionals
and an entrepreneurial spirit |
• | investing in properties in select markets, such as New York City, where we believe there is a high likelihood of capital appreciation |
• | acquiring quality properties at a discount to replacement cost and where there is a significant potential for higher rents |
• | investing
in retail properties in select under-stored locations such as the New York City metropolitan area |
• | developing and redeveloping existing properties to increase returns and maximize value |
• | investing in operating companies that have a significant real estate component |
(Amounts
in thousands) | For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Certain
items that impact net (loss) income attributable to common shareholders: | |||||||||||||||
JBG SMITH Properties which is treated as a discontinued operation: | |||||||||||||||
Transaction
costs | $ | (53,581 | ) | $ | (2,739 | ) | $ | (67,045 | ) | $ | (4,597 | ) | |||
Operating
results through July 17, 2017 spin-off | 3,950 | 29,489 | 47,752 | 66,714 | |||||||||||
(49,631 | ) | 26,750 | (19,293 | ) | 62,117 | ||||||||||
Impairment
loss on investment in Pennsylvania REIT | (44,465 | ) | — | (44,465 | ) | — | |||||||||
(Loss) income from real estate fund investments, net | (7,794 | ) | 807 | (11,333 | ) | 13,662 | |||||||||
Net
gain resulting from Urban Edge Properties operating partnership unit issuances | 5,200 | — | 21,100 | — | |||||||||||
Our share of write-off of deferred financing costs | (3,819 | ) | — | (3,819 | ) | — | |||||||||
Preferred
share issuance costs (Series J redemption) | — | (7,408 | ) | — | (7,408 | ) | |||||||||
Our share of net gain on sale of Suffolk Downs | — | — | 15,314 | — | |||||||||||
Net
gain on repayment of Suffolk Downs JV debt investments | — | — | 11,373 | — | |||||||||||
Skyline properties impairment loss | — | — | — | (160,700 | ) | ||||||||||
Net
gain on sale of 47% ownership interest in 7 West 34th Street | — | — | — | 159,511 | |||||||||||
Other | (3,197 | ) | (851 | ) | (1,024 | ) | (10,699 | ) | |||||||
(103,706 | ) | 19,298 | (32,147 | ) | 56,483 | ||||||||||
Noncontrolling
interests' share of above adjustments | 6,451 | (1,183 | ) | 1,407 | (3,430 | ) | |||||||||
Total of certain items that impact net (loss) income attributable to common shareholders, net | $ | (97,255 | ) | $ | 18,115 | $ | (30,740 | ) | $ | 53,053 |
Certain
items that impact FFO: | |||||||||||||||
JBG SMITH Properties which is treated as a discontinued operation: | |||||||||||||||
Transaction
costs | $ | (53,581 | ) | $ | (2,739 | ) | $ | (67,045 | ) | $ | (4,597 | ) | |||
Operating
results through July 17, 2017 spin-off | 10,148 | 61,699 | 122,201 | 169,141 | |||||||||||
(43,433 | ) | 58,960 | 55,156 | 164,544 | |||||||||||
Impairment
loss on investment in Pennsylvania REIT | (44,465 | ) | — | (44,465 | ) | — | |||||||||
(Loss) income from real estate fund investments, net | (7,794 | ) | 807 | (11,333 | ) | 13,662 | |||||||||
Net
gain resulting from Urban Edge Properties operating partnership unit issuances | 5,200 | — | 21,100 | — | |||||||||||
Our share of write-off of deferred financing costs | (3,819 | ) | — | (3,819 | ) | — | |||||||||
Preferred
share issuance costs (Series J redemption) | — | (7,408 | ) | — | (7,408 | ) | |||||||||
Net gain on repayment of our Suffolk Downs JV debt investments | — | — | 11,373 | — | |||||||||||
Other | (390 | ) | 171 | 856 | (130 | ) | |||||||||
(94,701 | ) | 52,530 | 28,868 | 170,668 | |||||||||||
Noncontrolling
interests' share of above adjustments | 5,890 | (3,220 | ) | (1,782 | ) | (10,877 | ) | ||||||||
Total of certain items that impact FFO, net | $ | (88,811 | ) | $ | 49,310 | $ | 27,086 | $ | 159,791 |
(Amounts
in thousands) | For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Certain
items that impact net (loss) income attributable to Class A unitholders: | |||||||||||||||
JBG SMITH Properties which is treated as a discontinued operation: | |||||||||||||||
Transaction
costs | $ | (53,581 | ) | $ | (2,739 | ) | $ | (67,045 | ) | $ | (4,597 | ) | |||
Operating
results through July 17, 2017 spin-off | 3,950 | 29,489 | 47,752 | 66,714 | |||||||||||
(49,631 | ) | 26,750 | (19,293 | ) | 62,117 | ||||||||||
Impairment
loss on investment in Pennsylvania REIT | (44,465 | ) | — | (44,465 | ) | — | |||||||||
(Loss) income from real estate fund investments, net | (7,794 | ) | 807 | (11,333 | ) | 13,662 | |||||||||
Net
gain resulting from Urban Edge Properties operating partnership unit issuances | 5,200 | — | 21,100 | — | |||||||||||
Our share of write-off of deferred financing costs | (3,819 | ) | — | (3,819 | ) | — | |||||||||
Preferred
unit issuance costs (Series J redemption) | — | (7,408 | ) | — | (7,408 | ) | |||||||||
Our share of net gain on sale of Suffolk Downs | — | — | 15,314 | — | |||||||||||
Net
gain on repayment of Suffolk Downs JV debt investments | — | — | 11,373 | — | |||||||||||
Skyline properties impairment loss | — | — | — | (160,700 | ) | ||||||||||
Net
gain on sale of 47% ownership interest in 7 West 34th Street | — | — | — | 159,511 | |||||||||||
Other | (3,197 | ) | (851 | ) | (1,024 | ) | (10,699 | ) | |||||||
Total
of certain items that impact net (loss) income attributable to Class A unitholders | $ | (103,706 | ) | $ | 19,298 | $ | (32,147 | ) | $ | 56,483 |
New
York | theMART | 555 California Street | |||||||
Same store EBITDA % increase (decrease) : | |||||||||
Three months ended September
30, 2017 compared to September 30, 2016 | 5.0 | % | (1) | 11.3 | % | 1.7 | % | ||
Nine months ended September 30, 2017 compared to September 30, 2016 | 2.7 | % | (1) | 3.4 | % | (2) | (0.2 | )% | |
Three
months ended September 30, 2017 compared to June 30, 2017 | 4.8 | % | (1) | (1.1 | )% | (4.1 | )% | ||
Same store NOI % increase (decrease): | |||||||||
Three
months ended September 30, 2017 compared to September 30, 2016 | 13.8 | % | (1) | 17.0 | % | 13.2 | % | ||
Nine months ended September 30, 2017 compared to September
30, 2016 | 13.2 | % | (1) | 5.8 | % | (2) | 37.9 | % | |
Three months ended September 30, 2017 compared to June 30, 2017 | 3.9 | % | (1) | 1.6 | % | (2.2 | )% | ||
EBITDA | NOI | ||||||
(1) | Excluding
Hotel Pennsylvania - same store % increase: | ||||||
Three months ended September 30, 2017 compared to September 30, 2016 | 4.5 | % | 13.4 | % | |||
Nine
months ended September 30, 2017 compared to September 30, 2016 | 2.3 | % | 12.8 | % | |||
Three months ended September 30, 2017 compared to June 30, 2017 | 5.3 | % | 4.4 | % | |||
(2) | The
nine months ended September 30, 2017 includes a $2,000,000 reversal of an expense accrued in 2015. Excluding this amount, same store EBITDA increased by 6.2% and same store NOI increased by 8.9%. |
(Square
feet in thousands) | New York | |||||||||||||||
Office | Retail | theMART | 555
California Street | |||||||||||||
Three Months Ended September 30, 2017 | ||||||||||||||||
Total square feet leased | 452 | 51 | 36 | 61 | ||||||||||||
Our
share of square feet leased: | 405 | 38 | 36 | 43 | ||||||||||||
Initial rent(1) | $ | 83.09 | $ | 346.34 | $ | 54.11 | $ | 71.77 | ||||||||
Weighted
average lease term (years) | 9.9 | 6.1 | 5.4 | 7.8 | ||||||||||||
Second generation relet space: | ||||||||||||||||
Square
feet | 322 | 22 | 22 | — | ||||||||||||
GAAP basis: | ||||||||||||||||
Straight-line
rent(2) | $ | 81.46 | $ | 89.13 | $ | 62.79 | $ | — | ||||||||
Prior
straight-line rent | $ | 72.79 | $ | 112.10 | $ | 46.03 | $ | — | ||||||||
Percentage
increase (decrease) | 11.9 | % | (20.5 | )% | (3) | 36.4 | % | — | % | |||||||
Cash basis: | ||||||||||||||||
Initial
rent(1) | $ | 83.64 | $ | 87.36 | $ | 61.02 | $ | — | ||||||||
Prior
escalated rent | $ | 75.21 | $ | 85.19 | $ | 49.56 | $ | — | ||||||||
Percentage
increase | 11.2 | % | 2.5 | % | 23.1 | % | — | % | ||||||||
Tenant improvements and leasing commissions: | ||||||||||||||||
Per
square foot | $ | 84.69 | $ | 232.54 | $ | 30.18 | $ | 131.32 | ||||||||
Per
square foot per annum | $ | 8.55 | $ | 38.12 | $ | 5.59 | $ | 16.83 | ||||||||
Percentage
of initial rent | 10.2 | % | 11.0 | % | 10.3 | % | 23.5 | % |
Nine
Months Ended September 30, 2017 | ||||||||||||||||
Total square feet leased | 1,548 | 87 | 227 | 132 | ||||||||||||
Our
share of square feet leased: | 1,188 | 68 | 227 | 93 | ||||||||||||
Initial rent(1) | $ | 79.35 | $ | 278.05 | $ | 48.37 | $ | 79.98 | ||||||||
Weighted
average lease term (years) | 8.4 | 6.0 | 6.9 | 9.4 | ||||||||||||
Second generation relet space: | ||||||||||||||||
Square
feet | 813 | 44 | 207 | 46 | ||||||||||||
GAAP basis: | ||||||||||||||||
Straight-line
rent(2) | $ | 73.89 | $ | 158.51 | $ | 48.53 | $ | 95.09 | ||||||||
Prior
straight-line rent | $ | 64.62 | $ | 140.76 | $ | 37.45 | $ | 80.30 | ||||||||
Percentage
increase | 14.3 | % | 12.6 | % | 29.6 | % | 18.4 | % | ||||||||
Cash basis: | ||||||||||||||||
Initial
rent(1) | $ | 75.52 | $ | 150.88 | $ | 48.27 | $ | 86.49 | ||||||||
Prior
escalated rent | $ | 68.23 | $ | 131.03 | $ | 39.83 | $ | 78.67 | ||||||||
Percentage
increase | 10.7 | % | 15.1 | % | 21.2 | % | 9.9 | % | ||||||||
Tenant improvements and leasing commissions: | ||||||||||||||||
Per
square foot | $ | 74.59 | $ | 156.88 | $ | 42.22 | $ | 111.81 | ||||||||
Per
square foot per annum | $ | 8.88 | $ | 26.15 | $ | 6.12 | $ | 11.89 | ||||||||
Percentage
of initial rent | 11.1 | % | 9.4 | % | 12.7 | % | 14.9 | % |
(1) | Represents
the cash basis weighted average starting rent per square foot, which is generally indicative of market rents. Most leases include free rent and periodic step-ups in rent which are not included in the initial cash basis rent per square foot but are included in the GAAP basis straight-line rent per square foot. |
(2) | Represents the GAAP basis weighted average rent per square foot that is recognized over the term of the respective leases, and includes the effect of free rent and periodic step-ups in rent. |
(3) | Attributable
to a single lease for 20,800 square feet at share at 1290 Avenue of the Americas that was the subject of a FAS 141 below market lease upward adjustment when we acquired the property in 2007. Excluding the FAS 141 adjustment the GAAP basis increase in rent would have been 8.0%. |
(Square
feet in thousands) | Square Feet (in service) | ||||||||||
Number of Properties | Total Portfolio | Our Share | Occupancy
% | ||||||||
New York: | |||||||||||
Office | 37 | 20,242 | 16,968 | 97.0 | % | ||||||
Retail | 72 | 2,709 | 2,473 | 95.7 | % | ||||||
Residential
- 1,696 units | 11 | 1,568 | 835 | 94.4 | % | ||||||
Alexander's, including 312 residential units | 7 | 2,437 | 790 | 99.3 | % | ||||||
Hotel
Pennsylvania | 1 | 1,400 | 1,400 | ||||||||
28,356 | 22,466 | 96.9 | % | ||||||||
Other: | |||||||||||
theMART | 3 | 3,689 | 3,680 | 98.7 | % | ||||||
555
California Street | 3 | 1,740 | 1,218 | 94.2 | % | ||||||
Rosslyn Plaza Office and Residential - 197 units | 6 | 690 | 313 | 65.9 | % | ||||||
Other | 4 | 1,836 | 877 | 99.8 | % | ||||||
7,955 | 6,088 | ||||||||||
Total
square feet as of September 30, 2017 | 36,311 | 28,554 |
(Square feet in thousands) | Square Feet (in service) | ||||||||||
Number of properties | Total Portfolio | Our Share | Occupancy
% | ||||||||
New York: | |||||||||||
Office | 36 | 20,227 | 16,962 | 96.3 | % | ||||||
Retail | 70 | 2,672 | 2,464 | 97.1 | % | ||||||
Residential
- 1,692 units | 11 | 1,559 | 826 | 95.7 | % | ||||||
Alexander's, including 312 residential units | 7 | 2,437 | 790 | 99.8 | % | ||||||
Hotel
Pennsylvania | 1 | 1,400 | 1,400 | ||||||||
28,295 | 22,442 | 96.5 | % | ||||||||
Other: | |||||||||||
theMART | 3 | 3,671 | 3,662 | 98.9 | % | ||||||
555
California Street | 3 | 1,738 | 1,217 | 92.4 | % | ||||||
Rosslyn Plaza Office and Residential - 196 units | 6 | 746 | 339 | 64.0 | % | ||||||
Other | 4 | 1,811 | 850 | 99.8 | % | ||||||
7,966 | 6,068 | ||||||||||
Total
square feet as of December 31, 2016 | 36,261 | 28,510 |
(Amounts in thousands) | For the Three Months Ended September 30, 2017 | |||||||||||
Total | New
York | Other | ||||||||||
Total revenues | $ | 528,755 | $ | 453,609 | $ | 75,146 | ||||||
Total
expenses | 366,520 | 284,976 | 81,544 | |||||||||
Operating income (loss) | 162,235 | 168,633 | (6,398 | ) | ||||||||
(Loss)
income from partially owned entities | (41,801 | ) | 1,411 | (43,212 | ) | |||||||
Loss from real estate fund investments | (6,308 | ) | — | (6,308 | ) | |||||||
Interest
and other investment income, net | 9,306 | 1,413 | 7,893 | |||||||||
Interest and debt expense | (85,068 | ) | (61,529 | ) | (23,539 | ) | ||||||
Income
(loss) before income taxes | 38,364 | 109,928 | (71,564 | ) | ||||||||
Income tax expense | (1,188 | ) | (1,087 | ) | (101 | ) | ||||||
Income
(loss) from continuing operations | 37,176 | 108,841 | (71,665 | ) | ||||||||
Loss from discontinued operations | (47,930 | ) | — | (47,930 | ) | |||||||
Net
(loss) income | (10,754 | ) | 108,841 | (119,595 | ) | |||||||
Less net income attributable to noncontrolling interests in consolidated subsidiaries | (4,022 | ) | (2,552 | ) | (1,470 | ) | ||||||
Net
(loss) income attributable to the Operating Partnership | (14,776 | ) | 106,289 | (121,065 | ) | |||||||
Interest and debt expense(2) | 113,438 | 84,907 | 28,531 | |||||||||
Depreciation
and amortization(2) | 136,621 | 104,799 | 31,822 | |||||||||
Income tax expense (2) | 1,462 | 1,182 | 280 | |||||||||
EBITDA(1) | 236,745 | 297,177 | (3) | (60,432 | ) | (4) | ||||||
Acquisition
and transaction related costs, including $53,581 for the spin-off of JBGS | 53,642 | — | 53,642 | |||||||||
Impairment loss on investment in PREIT | 44,465 | — | 44,465 | |||||||||
General
and administrative expenses less $1,975 mark-to-market of our deferred compensation plan | 35,495 | 9,479 | 26,016 | |||||||||
Non-cash adjustments for straight-line rental income and expense and amortization of acquired below and above market leases, net(2) | (23,304 | ) | (21,435 | ) | (1,869 | ) | ||||||
Our
share of net realized/unrealized losses from our real estate fund investments | 10,394 | — | 10,394 | |||||||||
Net gain resulting from UE operating partnership unit issuances | (5,200 | ) | — | (5,200 | ) | |||||||
Real
estate impairment losses(2) | 4,354 | — | 4,354 | |||||||||
Net gains on sale of real estate and other(2) | (1,547 | ) | — | (1,547 | ) | |||||||
Our
share of Alexander's EBITDA (excluding management, leasing and development fees) | (12,207 | ) | (12,207 | ) | — | |||||||
Dividends received from Alexander's | 7,030 | 7,030 | — | |||||||||
Our
share of PREIT EBITDA | (3,731 | ) | — | (3,731 | ) | |||||||
Distributions received from PREIT | 1,361 | — | 1,361 | |||||||||
Our
share of UE EBITDA (excluding management fees) | (2,513 | ) | — | (2,513 | ) | |||||||
Distributions received from UE | 1,257 | — | 1,257 | |||||||||
NOI(1) | $ | 346,241 | $ | 280,044 | (3) | $ | 66,197 | (4) |
(Amounts
in thousands) | For the Three Months Ended September 30, 2016 | |||||||||||
Total | New York | Other | ||||||||||
Total revenues | $ | 502,753 | $ | 432,869 | $ | 69,884 | ||||||
Total
expenses | 354,292 | 280,689 | 73,603 | |||||||||
Operating income (loss) | 148,461 | 152,180 | (3,719 | ) | ||||||||
Income
(loss) from partially owned entities | 3,811 | (579 | ) | 4,390 | ||||||||
Income from real estate fund investments | 1,077 | — | 1,077 | |||||||||
Interest
and other investment income, net | 6,459 | 1,355 | 5,104 | |||||||||
Interest and debt expense | (79,721 | ) | (51,212 | ) | (28,509 | ) | ||||||
Income
(loss) before income taxes | 80,087 | 101,744 | (21,657 | ) | ||||||||
Income tax expense | (4,563 | ) | (2,356 | ) | (2,207 | ) | ||||||
Income
(loss) from continuing operations | 75,524 | 99,388 | (23,864 | ) | ||||||||
Income from discontinued operations | 25,080 | — | 25,080 | |||||||||
Net
income | 100,604 | 99,388 | 1,216 | |||||||||
Less net income attributable to noncontrolling interests in consolidated subsidiaries | (3,658 | ) | (2,985 | ) | (673 | ) | ||||||
Net
income attributable to the Operating Partnership | 96,946 | 96,403 | 543 | |||||||||
Interest and debt expense(2) | 122,979 | 66,314 | 56,665 | |||||||||
Depreciation
and amortization(2) | 172,980 | 111,731 | 61,249 | |||||||||
Income tax expense(2) | 5,102 | 2,445 | 2,657 | |||||||||
EBITDA(1) | 398,007 | 276,893 | (3) | 121,114 | (4) | |||||||
Non-cash
adjustments for straight-line rental income and expense and amortization of acquired below and above market leases, net(2) | (46,500 | ) | (35,199 | ) | (11,301 | ) | ||||||
General and administrative expenses less $204 mark-to-market of our deferred compensation plan | 40,238 | 9,783 | 30,455 | |||||||||
Net
gains on sale of real estate and other(2) | (5,386 | ) | — | (5,386 | ) | |||||||
Acquisition and transaction related costs, including $2,739 for the spin-off of JBGS | 3,808 | — | 3,808 | |||||||||
Real
estate impairment losses(2) | 1,599 | — | 1,599 | |||||||||
Our share of net realized/unrealized losses from our real estate fund investments | 99 | — | 99 | |||||||||
Our
share of Alexander's EBITDA (excluding management, leasing and development fees) | (11,506 | ) | (11,506 | ) | — | |||||||
Dividends received from Alexander's | 6,617 | 6,617 | — | |||||||||
Our
share of PREIT EBITDA | (3,070 | ) | — | (3,070 | ) | |||||||
Distributions received from PREIT | 1,342 | — | 1,342 | |||||||||
Our
share of UE EBITDA (excluding management fees) | (2,514 | ) | — | (2,514 | ) | |||||||
Distributions received from UE | 1,143 | — | 1,143 | |||||||||
NOI(1) | $ | 383,877 | $ | 246,588 | (3) | $ | 137,289 | (4) |
(1) | EBITDA
represents "Earnings Before Interest, Taxes, Depreciation and Amortization." NOI represents "Net Operating Income" on a cash basis. We calculate EBITDA and NOI on an Operating Partnership basis which is before allocation to the noncontrolling interest of the Operating Partnership. We consider EBITDA the primary non-GAAP financial measure for making decisions and assessing the unlevered performance of our segments as it relates to the total return on assets as opposed to the levered return on equity. We also consider NOI a key non-GAAP financial measure. NOI is before general and administrative expenses, straight-line rental income and expense, amortization of acquired below and above market leases, net, acquisition and transaction related costs, our share of net realized and unrealized gains or losses from our real estate fund investments, impairment losses and gains on disposal of assets. As properties are bought and sold based on a multiple of NOI,
we utilize this measure to make investment decisions as well as to compare the performance of our assets to those of our peers. EBITDA and NOI should not be considered substitutes for net income. EBITDA and NOI may not be comparable to similarly titled measures employed by other companies. |
(2) | Adjustments include our proportionate share of partially owned entities and give effect to noncontrolling interest's share of consolidated subsidiaries. |
(3) | The
elements of "New York" EBITDA are summarized below. |
(Amounts in thousands) | For the Three Months Ended September 30, | ||||||||
2017 | 2016 | ||||||||
Office | $ | 183,162 | $ | 164,150 | (a) | ||||
Retail | 90,316 | 91,061 | (a) | ||||||
Residential | 5,981 | 6,214 | |||||||
Alexander's | 12,207 | 11,506 | |||||||
Hotel
Pennsylvania | 5,511 | 3,962 | |||||||
Total New York EBITDA | $ | 297,177 | $ | 276,893 |
(Amounts in thousands) | For the Three Months Ended September 30, | ||||||||
2017 | 2016 | ||||||||
Office | $ | 179,505 | $ | 157,643 | (a) | ||||
Retail | 81,839 | 72,178 | (a) | ||||||
Residential | 5,418 | 5,525 | |||||||
Alexander's | 7,030 | 6,617 | |||||||
Hotel
Pennsylvania | 6,252 | 4,625 | |||||||
Total New York NOI, as adjusted | $ | 280,044 | $ | 246,588 |
(a) | Beginning
in January 2017 for office buildings with retail at the base, we have adjusted the allocation of real estate taxes between the retail and office elements above. This has no effect on our consolidated financial statements but resulted in a reallocation of $4,213 of income from retail to office for the three months ended September 30, 2016. |
(4) | The elements of "Other" EBITDA are summarized below. |
(Amounts
in thousands) | For the Three Months Ended September 30, | |||||||
2017 | 2016 | |||||||
theMART (including trade shows) | $ | 24,165 | $ | 21,696 | ||||
555
California Street | 11,643 | 11,405 | ||||||
Other investments | 11,379 | 20,388 | ||||||
Corporate
general and administrative expenses(a) | (22,730 | ) | (21,519 | ) | ||||
Investment income and other, net(a) | 5,910 | 6,871 | ||||||
Other
EBITDA, as adjusted | 30,367 | 38,841 | ||||||
Certain items that impact EBITDA: | ||||||||
JBG SMITH Properties which is treated as a discontinued operation: | ||||||||
Transaction
costs | (53,581 | ) | (2,739 | ) | ||||
Operating results through July 17, 2017 spin-off | 13,038 | 75,307 | ||||||
(40,543 | ) | 72,568 | ||||||
Impairment
loss on investment in Pennsylvania REIT | (44,465 | ) | — | |||||
(Loss) income from real estate fund investments, net | (7,794 | ) | 807 | |||||
Net
gain resulting from UE Properties operating partnership unit issuances | 5,200 | — | ||||||
Other | (3,197 | ) | 8,898 | |||||
Total
of certain items that impact EBITDA | (90,799 | ) | 82,273 | |||||
Other EBITDA | $ | (60,432 | ) | $ | 121,114 |
(Amounts in thousands) | For the Three Months Ended September 30, | |||||||
2017 | 2016 | |||||||
theMART
(including trade shows) | $ | 25,422 | $ | 21,758 | ||||
555 California Street | 11,013 | 9,899 | ||||||
Other
investments | 7,589 | 21,381 | ||||||
Investment income and other, net(a) | 5,910 | 6,871 | ||||||
Other
NOI, as adjusted | 49,934 | 59,909 | ||||||
Certain items that impact NOI: | ||||||||
JBG SMITH Properties operating results through July
17, 2017 spin-off | 12,971 | 72,919 | ||||||
Our share of real estate fund investments | 2,600 | 2,555 | ||||||
Other | 692 | 1,906 | ||||||
Total
of certain items that impact NOI | 16,263 | 77,380 | ||||||
Other NOI | $ | 66,197 | $ | 137,289 |
(a) | The amounts in these captions (for this table only) exclude the results of the mark-to-market of our deferred compensation plan of $1,975 and $204 of income for the three months ended September 30, 2017 and 2016, respectively. |
For the Three Months Ended September 30, | |||||
2017 | 2016 | ||||
Region: | |||||
New
York City metropolitan area | 89 | % | 89 | % | |
Chicago, IL | 7 | % | 7 | % | |
San Francisco, CA | 4 | % | 4 | % | |
100 | % | 100 | % |
(Amounts
in thousands) | Total | New York | Other | ||||||||
Increase (decrease) due to: | |||||||||||
Property rentals: | |||||||||||
Acquisitions,
dispositions and other | $ | 3,228 | $ | 3,002 | $ | 226 | |||||
Development and redevelopment | 89 | (93 | ) | 182 | |||||||
Hotel
Pennsylvania | 3,215 | 3,215 | — | ||||||||
Trade shows | 497 | — | 497 | ||||||||
Same
store operations | 13,880 | 10,901 | 2,979 | ||||||||
20,909 | 17,025 | 3,884 | |||||||||
Tenant
expense reimbursements: | |||||||||||
Acquisitions, dispositions and other | (680 | ) | (680 | ) | — | ||||||
Development
and redevelopment | 309 | (37 | ) | 346 | |||||||
Same store operations | 2,815 | 1,737 | 1,078 | ||||||||
2,444 | 1,020 | 1,424 | |||||||||
Fee
and other income: | |||||||||||
BMS cleaning fees | 1,896 | 2,904 | (1,008 | ) | |||||||
Management
and leasing fees | 396 | 354 | 42 | ||||||||
Lease termination fees | (830 | ) | (239 | ) | (591 | ) | |||||
Other
income | 1,187 | (324 | ) | 1,511 | |||||||
2,649 | 2,695 | (46 | ) | ||||||||
Total
increase in revenues | $ | 26,002 | $ | 20,740 | $ | 5,262 |
(Amounts in thousands) | Total | New York | Other | ||||||||||
(Decrease)
increase due to: | |||||||||||||
Operating: | |||||||||||||
Acquisitions,
dispositions and other | $ | (786 | ) | $ | (786 | ) | $ | — | |||||
Development and redevelopment | 453 | 75 | 378 | ||||||||||
Non-reimbursable
expenses, including bad debt reserves | (1,459 | ) | (2,040 | ) | 581 | ||||||||
Hotel Pennsylvania | 1,607 | 1,607 | — | ||||||||||
Trade
shows | 270 | — | 270 | ||||||||||
BMS expenses | 1,586 | 2,502 | (916 | ) | |||||||||
Same
store operations | 9,793 | 6,729 | 3,064 | ||||||||||
11,464 | 8,087 | 3,377 | |||||||||||
Depreciation
and amortization: | |||||||||||||
Acquisitions, dispositions and other | 117 | 117 | — | ||||||||||
Development
and redevelopment | (159 | ) | (24 | ) | (135 | ) | |||||||
Same store operations | (863 | ) | (3,589 | ) | 2,726 | ||||||||
(905 | ) | (3,496 | ) | 2,591 | |||||||||
General
and administrative: | |||||||||||||
Mark-to-market of deferred compensation plan liability | 1,771 | — | 1,771 | (1) | |||||||||
Same
store operations | 906 | (304 | ) | 1,210 | |||||||||
2,677 | (304 | ) | 2,981 | ||||||||||
Acquisition
and transaction related costs | (1,008 | ) | — | (1,008 | ) | ||||||||
Total
increase in expenses | $ | 12,228 | $ | 4,287 | $ | 7,941 |
(1) | This
increase in expense is entirely offset by a corresponding increase in income from the mark-to-market of the deferred compensation plan assets, a component of “interest and other investment income, net” on our consolidated statements of income. |
(Amounts in thousands, except per share amounts) | Percentage Ownership
at | For the Three Months Ended September 30, | ||||||||
2017 | 2016 | |||||||||
Our Share of Net (Loss) Income: | ||||||||||
Pennsylvania
Real Estate Investment Trust ("PREIT")(1) | 8.0% | $ | (49,748 | ) | $ | 52 | ||||
Alexander's | 32.4% | 7,845 | 8,785 | |||||||
Urban
Edge Properties ("UE")(2) | 4.5% | 6,008 | 2,158 | |||||||
Partially owned office buildings/land (3) | Various | (5,551 | ) | (8,642 | ) | |||||
Other
investments(4) | Various | (355 | ) | 1,458 | ||||||
$ | (41,801 | ) | $ | 3,811 |
(1) | Based
on PREIT’s September 29, 2017 quarter ended closing share price of $10.49, the market value (“fair value” pursuant to ASC Topic 323, Investments - Equity Method and Joint Ventures) of our investment in PREIT was $65,563 or $44,465 below the carrying amount on our consolidated balance sheet. We have concluded that our investment in PREIT is “other-than-temporarily” impaired and recorded a $44,465 non-cash impairment loss on our consolidated statements of income. Our conclusion was based on a sustained trading value of PREIT stock below our carrying amount and our inability to forecast a recovery in the near-term. |
(2) | 2017
includes a $5,200 net gain resulting from UE operating partnership unit issuances. |
(3) | Includes interests in 280 Park Avenue, 650 Madison Avenue, One Park Avenue, 666 Fifth Avenue (Office), 7 West 34th Street, 330 Madison Avenue, 512 West 22nd Street, 85 Tenth Avenue and others. |
(4) | Includes interests in Independence Plaza, Fashion Centre Mall/Washington Tower, Rosslyn Plaza, 50-70 West 93rd Street, Toys "R" Us, Inc., and others. |
(Amounts in thousands) | For the Three Months Ended September 30, | ||||||
2017 | 2016 | ||||||
Net
investment income | $ | 6,028 | $ | 5,841 | |||
Net realized gains on exited investments | 35,620 | — | |||||
Previously
recorded unrealized gains on exited investment | (36,736 | ) | — | ||||
Net unrealized loss on held investments | (11,220 | ) | (4,764 | ) | |||
(Loss) income from real estate fund investments | (6,308 | ) | 1,077 | ||||
Less
income attributable to noncontrolling interests in consolidated subsidiaries | (1,486 | ) | (270 | ) | |||
(Loss) income from real estate fund investments attributable to the Operating Partnership (1) | (7,794 | ) | 807 | ||||
Less
loss (income) attributable to noncontrolling interests in the Operating Partnership | 485 | (49 | ) | ||||
(Loss) income from real estate fund investments attributable to Vornado | $ | (7,309 | ) | $ | 758 |
(1) | Excludes
$744 and $804 of management and leasing fees for the three months ended September 30, 2017 and 2016, respectively, which are included as a component of "fee and other income" on our consolidated statements of income. |
(Amounts
in thousands) | For the Three Months Ended September 30, | ||||||
2017 | 2016 | ||||||
Total revenues | $ | 25,747 | $ | 134,912 | |||
Total
expenses | 21,708 | 109,506 | |||||
4,039 | 25,406 | ||||||
JBG SMITH Properties spin-off transaction costs | (53,581 | ) | (2,739 | ) | |||
Net
gains on sale of real estate and a lease position | 1,530 | 2,864 | |||||
Income from partially owned assets | 93 | 316 | |||||
Impairment losses | — | (465 | ) | ||||
Pretax
(loss) income from discontinued operations | (47,919 | ) | 25,382 | ||||
Income tax expense | (11 | ) | (302 | ) | |||
(Loss) income from discontinued operations | $ | (47,930 | ) | $ | 25,080 |
(Amounts in thousands) | New York | theMART | 555
California Street | |||||||||
EBITDA for the three months ended September 30, 2017 | $ | 297,177 | $ | 24,165 | $ | 11,643 | ||||||
Add-back: | ||||||||||||
Non-property
level overhead expenses included above | 9,479 | 1,859 | — | |||||||||
Less EBITDA from: | ||||||||||||
Acquisitions | (5,454 | ) | 42 | — | ||||||||
Dispositions | (15 | ) | — | — | ||||||||
Development
properties placed into and out of service | (6,228 | ) | — | — | ||||||||
Other non-operating income, net | (1,076 | ) | — | — | ||||||||
Same
store EBITDA for the three months ended September 30, 2017 | $ | 293,883 | $ | 26,066 | $ | 11,643 | ||||||
EBITDA
for the three months ended September 30, 2016 | $ | 276,893 | $ | 21,696 | $ | 11,405 | ||||||
Add-back: | ||||||||||||
Non-property
level overhead expenses included above | 9,783 | 1,720 | 55 | |||||||||
Less EBITDA from: | ||||||||||||
Acquisitions | (205 | ) | — | — | ||||||||
Dispositions | 19 | — | — | |||||||||
Development
properties placed into and out of service | (7,967 | ) | — | 226 | ||||||||
Other non-operating loss (income), net | 1,285 | — | (239 | ) | ||||||||
Same
store EBITDA for the three months ended September 30, 2016 | $ | 279,808 | $ | 23,416 | $ | 11,447 | ||||||
Increase
in same store EBITDA for the three months ended September 30, 2017 compared to September 30, 2016 | $ | 14,075 | $ | 2,650 | $ | 196 | ||||||
%
increase in same store EBITDA | 5.0 | % | (1) | 11.3 | % | 1.7 | % |
(1) | Excluding Hotel Pennsylvania, same store EBITDA increased
by 4.5%. |
(Amounts in thousands) | New York | theMART | 555
California Street | |||||||||
NOI for the three months ended September 30, 2017 | $ | 280,044 | $ | 25,422 | $ | 11,013 | ||||||
Less
NOI from: | ||||||||||||
Acquisitions | (3,682 | ) | 42 | — | ||||||||
Dispositions | (15 | ) | — | — | ||||||||
Development
properties placed into and out of service | (1,779 | ) | — | — | ||||||||
Other non-operating income, net | (6,022 | ) | — | — | ||||||||
Same
store NOI for the three months ended September 30, 2017 | $ | 268,546 | $ | 25,464 | $ | 11,013 | ||||||
NOI
for the three months ended September 30, 2016 | $ | 246,588 | $ | 21,758 | $ | 9,899 | ||||||
Less NOI
from: | ||||||||||||
Dispositions | 19 | — | — | |||||||||
Development
properties placed into and out of service | (1,950 | ) | — | 226 | ||||||||
Other non-operating income, net | (8,769 | ) | — | (397 | ) | |||||||
Same
store NOI for the three months ended September 30, 2016 | $ | 235,888 | $ | 21,758 | $ | 9,728 | ||||||
Increase
in same store NOI for the three months ended September 30, 2017 compared to September 30, 2016 | $ | 32,658 | $ | 3,706 | $ | 1,285 | ||||||
%
increase in same store NOI | 13.8 | % | (1) | 17.0 | % | 13.2 | % |
(1) | Excluding Hotel Pennsylvania, same store NOI increased
by 13.4%. |
(Amounts in thousands) | For
the Nine Months Ended September 30, 2017 | |||||||||||
Total | New York | Other | ||||||||||
Total revenues | $ | 1,547,900 | $ | 1,316,710 | $ | 231,190 | ||||||
Total
expenses | 1,100,042 | 845,632 | 254,410 | |||||||||
Operating income (loss) | 447,858 | 471,078 | (23,220 | ) | ||||||||
Income
(loss) from partially owned entities | 5,578 | (954 | ) | 6,532 | ||||||||
Loss from real estate fund investments | (1,649 | ) | — | (1,649 | ) | |||||||
Interest
and other investment income, net | 27,800 | 4,384 | 23,416 | |||||||||
Interest and debt expense | (252,581 | ) | (179,851 | ) | (72,730 | ) | ||||||
Net
gain on disposition of wholly owned and partially owned assets | 501 | — | 501 | |||||||||
Income (loss) before income taxes | 227,507 | 294,657 | (67,150 | ) | ||||||||
Income
tax expense | (2,429 | ) | (324 | ) | (2,105 | ) | ||||||
Income (loss) from continuing operations | 225,078 | 294,333 | (69,255 | ) | ||||||||
Loss
from discontinued operations | (14,501 | ) | — | (14,501 | ) | |||||||
Net income (loss) | 210,577 | 294,333 | (83,756 | ) | ||||||||
Less
net income attributable to noncontrolling interests in consolidated subsidiaries | (18,436 | ) | (8,041 | ) | (10,395 | ) | ||||||
Net income (loss) attributable to the Operating Partnership | 192,141 | 286,292 | (94,151 | ) | ||||||||
Interest
and debt expense(2) | 348,350 | 239,032 | 109,318 | |||||||||
Depreciation and amortization(2) | 476,406 | 328,058 | 148,348 | |||||||||
Income
tax expense(2) | 4,180 | 540 | 3,640 | |||||||||
EBITDA(1) | 1,021,077 | 853,922 | (3) | 167,155 | (4) | |||||||
General
and administrative expenses less $5,233 mark-to-market of our deferred compensation plan | 131,365 | 31,630 | 99,735 | |||||||||
Non-cash adjustments for straight-line rental income and expense and amortization of acquired below and above market leases, net(2) | (73,125 | ) | (58,797 | ) | (14,328 | ) | ||||||
Acquisition
and transaction related costs, including $67,045 for the spin-off of JBGS | 68,118 | — | 68,118 | |||||||||
Impairment loss on investment in PREIT | 44,465 | — | 44,465 | |||||||||
Net
gains on sale of real estate and other(2) | (21,507 | ) | — | (21,507 | ) | |||||||
Net gains resulting from UE operating partnership unit issuances | (21,100 | ) | — | (21,100 | ) | |||||||
Our
share of net realized/unrealized losses from our real estate fund investments | 18,802 | — | 18,802 | |||||||||
Net gain on repayment of our Suffolk Downs JV debt investments | (11,373 | ) | — | (11,373 | ) | |||||||
Real
estate impairment losses(2) | 7,572 | — | 7,572 | |||||||||
Our share of Alexander's EBITDA (excluding management, leasing and development fees) | (35,511 | ) | (35,511 | ) | — | |||||||
Dividends
received from Alexander's | 21,090 | 21,090 | — | |||||||||
Our share of PREIT EBITDA | (15,439 | ) | — | (15,439 | ) | |||||||
Distributions
received from PREIT | 3,929 | — | 3,929 | |||||||||
Our share of UE EBITDA (excluding management fees) | (9,694 | ) | — | (9,694 | ) | |||||||
Distributions
received from UE | 3,773 | — | 3,773 | |||||||||
NOI(1) | $ | 1,132,442 | $ | 812,334 | (3) | $ | 320,108 | (4) |
(Amounts
in thousands) | For the Nine Months Ended September 30, 2016 | |||||||||||
Total | New York | Other | ||||||||||
Total revenues | $ | 1,489,768 | $ | 1,269,464 | $ | 220,304 | ||||||
Total
expenses | 1,062,219 | 818,419 | 243,800 | |||||||||
Operating income (loss) | 427,549 | 451,045 | (23,496 | ) | ||||||||
Income
(loss) from partially owned entities | 3,892 | (5,143 | ) | 9,035 | ||||||||
Income from real estate fund investments | 28,750 | — | 28,750 | |||||||||
Interest
and other investment income, net | 20,121 | 3,684 | 16,437 | |||||||||
Interest and debt expense | (250,034 | ) | (162,193 | ) | (87,841 | ) | ||||||
Net
gains on disposition of wholly owned and partially owned assets | 160,225 | 159,511 | 714 | |||||||||
Income (loss) before income taxes | 390,503 | 446,904 | (56,401 | ) | ||||||||
Income
tax expense | (8,921 | ) | (4,131 | ) | (4,790 | ) | ||||||
Income (loss) from continuing operations | 381,582 | 442,773 | (61,191 | ) | ||||||||
Loss
from discontinued operations | (104,204 | ) | — | (104,204 | ) | |||||||
Net income (loss) | 277,378 | 442,773 | (165,395 | ) | ||||||||
Less
net income attributable to noncontrolling interests in consolidated subsidiaries | (26,361 | ) | (9,811 | ) | (16,550 | ) | ||||||
Net income (loss) attributable to the Operating Partnership | 251,017 | 432,962 | (181,945 | ) | ||||||||
Interest
and debt expense(2) | 376,898 | 208,683 | 168,215 | |||||||||
Depreciation and amortization(2) | 521,143 | 331,448 | 189,695 | |||||||||
Income
tax expense(2) | 13,067 | 4,424 | 8,643 | |||||||||
EBITDA(1) | 1,162,125 | 977,517 | (3) | 184,608 | (4) | |||||||
Net
gains on sale of real estate and other(2) | (168,140 | ) | (159,511 | ) | (8,629 | ) | ||||||
Real estate impairment losses(2) | 166,701 | — | 166,701 | |||||||||
Non-cash
adjustments for straight-line rental income and expense and amortization of acquired below and above market leases, net(2) | (152,023 | ) | (114,217 | ) | (37,806 | ) | ||||||
General and administrative expenses less $2,625 mark-to-market of our deferred compensation plan | 132,085 | 27,557 | 104,528 | |||||||||
Acquisition
and transaction related costs, including $4,597 for the spin-off of JBGS | 11,319 | — | 11,319 | |||||||||
Our share of net realized/unrealized gains from our real estate fund investments | (8,741 | ) | — | (8,741 | ) | |||||||
Our
share of Alexander's EBITDA (excluding management, leasing and development fees) | (34,880 | ) | (34,880 | ) | — | |||||||
Dividends received from Alexander's | 19,849 | 19,849 | — | |||||||||
Our
share of PREIT EBITDA | (8,537 | ) | — | (8,537 | ) | |||||||
Distributions received from PREIT | 3,906 | — | 3,906 | |||||||||
Our
share of UE EBITDA (excluding management fees) | (7,539 | ) | — | (7,539 | ) | |||||||
Distributions received from UE | 3,430 | — | 3,430 | |||||||||
NOI(1) | $ | 1,119,555 | $ | 716,315 | (3) | $ | 403,240 | (4) |
(1) | EBITDA
represents "Earnings Before Interest, Taxes, Depreciation and Amortization." NOI represents "Net Operating Income" on a cash basis. We calculate EBITDA and NOI on an Operating Partnership basis which is before allocation to the noncontrolling interest of the Operating Partnership. We consider EBITDA the primary non-GAAP financial measure for making decisions and assessing the unlevered performance of our segments as it relates to the total return on assets as opposed to the levered return on equity. We also consider NOI a key non-GAAP financial measure. NOI is before general and administrative expenses, straight-line rental income and expense, amortization of acquired below and above market leases, net, acquisition and transaction related costs, our share of net realized and unrealized gains or losses from our real estate fund investments, impairment losses and gains on disposal of assets. As properties are bought and sold based on a multiple of NOI,
we utilize this measure to make investment decisions as well as to compare the performance of our assets to those of our peers. EBITDA and NOI should not be considered substitutes for net income. EBITDA and NOI may not be comparable to similarly titled measures employed by other companies. |
(2) | Adjustments include our proportionate share of partially owned entities and give effect to noncontrolling interest's share of consolidated subsidiaries. |
(3) | The
elements of "New York" EBITDA are summarized below. |
(Amounts in thousands) | For the Nine Months Ended September 30, | ||||||||
2017 | 2016 | ||||||||
Office | $ | 522,566 | $ | 484,735 | (a) | ||||
Retail | 269,762 | 272,083 | (a) | ||||||
Residential | 18,450 | 18,901 | |||||||
Alexander's | 35,511 | 34,880 | |||||||
Hotel
Pennsylvania | 7,633 | 4,287 | |||||||
Total New York EBITDA, as adjusted | 853,922 | 814,886 | |||||||
Certain
items that impact EBITDA | |||||||||
Net gain on sale of 47% ownership interest in 7 West 34th Street | — | 159,511 | |||||||
EBITDA
from sold properties | — | 3,120 | |||||||
Total of certain items that impact EBITDA | — | 162,631 | |||||||
Total
of New York EBITDA | $ | 853,922 | $ | 977,517 |
(Amounts
in thousands) | For the Nine Months Ended September 30, | ||||||||
2017 | 2016 | ||||||||
Office | $ | 523,531 | $ | 459,509 | (a) | ||||
Retail | 241,667 | 211,611 | (a) | ||||||
Residential | 16,300 | 16,724 | |||||||
Alexander's | 21,090 | 19,849 | |||||||
Hotel
Pennsylvania | 9,746 | 6,390 | |||||||
Total New York NOI, as adjusted | 812,334 | 714,083 | |||||||
NOI
from sold properties | — | 2,232 | |||||||
Total New York NOI | $ | 812,334 | $ | 716,315 |
(a) | Beginning
in January 2017 for office buildings with retail at the base, we have adjusted the allocation of real estate taxes between the retail and office elements above. This has no effect on our consolidated financial statements but resulted in a reallocation of $12,058 of income from retail to office for the nine months ended September 30, 2016. |
(4) | The elements of "Other" EBITDA are summarized below. |
(Amounts in thousands) | For
the Nine Months Ended September 30, | |||||||
2017 | 2016 | |||||||
theMART (including trade shows) | $ | 72,471 | $ | 70,689 | ||||
555
California Street | 35,870 | 35,137 | ||||||
Other investments | 36,318 | 57,092 | ||||||
Corporate
general and administrative expenses(a) | (78,952 | ) | (76,364 | ) | ||||
Investment income and other, net(a) | 24,079 | 19,317 | ||||||
Other
EBITDA, as adjusted | 89,786 | 105,871 | ||||||
Certain items that impact EBITDA: | ||||||||
JBG SMITH Properties which is treated as a discontinued operation: | ||||||||
Transaction
costs | (67,045 | ) | (4,597 | ) | ||||
Operating results through July 17, 2017 spin-off | 153,449 | 214,604 | ||||||
86,404 | 210,007 | |||||||
Impairment
loss on investment in Pennsylvania REIT | (44,465 | ) | — | |||||
(Loss) income from real estate fund investments, net | (11,333 | ) | 13,662 | |||||
Net
gain resulting from Urban Edge Properties operating partnership unit issuances | 21,100 | — | ||||||
Our share of net gain on sale of Suffolk Downs | 15,314 | — | ||||||
Net
gain on repayment of Suffolk Downs JV debt investments | 11,373 | — | ||||||
Skyline properties impairment loss | — | (160,700 | ) | |||||
Other | (1,024 | ) | 15,768 | |||||
Total
of certain items that impact EBITDA | 77,369 | 78,737 | ||||||
Other EBITDA | $ | 167,155 | $ | 184,608 |
(Amounts in thousands) | For the Nine Months Ended September 30, | |||||||
2017 | 2016 | |||||||
theMART
(including trade shows) | $ | 74,859 | $ | 70,914 | ||||
555 California Street | 33,647 | 24,010 | ||||||
Other
investments | 15,138 | 44,482 | ||||||
Investment income and other, net(a) | 24,079 | 19,317 | ||||||
Other
NOI, as adjusted | 147,723 | 158,723 | ||||||
Certain items that impact NOI: | ||||||||
JBG SMITH Properties operating results through July
17, 2017 spin-off | 160,634 | 233,310 | ||||||
Our share of real estate fund investments | 7,469 | 6,313 | ||||||
Other | 4,282 | 4,894 | ||||||
Total
of certain items that impact EBITDA | 172,385 | 244,517 | ||||||
Other NOI | $ | 320,108 | $ | 403,240 |
(a) | The
amounts in these captions (for this table only) exclude the results of the mark-to-market of our deferred compensation plan of $5,233 and $2,625 of income for the nine months ended September 30, 2017 and 2016, respectively. |
For
the Nine Months Ended September 30, | |||||
2017 | 2016 | ||||
Region: | |||||
New York City metropolitan area | 88 | % | 88 | % | |
Chicago,
IL | 8 | % | 8 | % | |
San Francisco, CA | 4 | % | 4 | % | |
100 | % | 100 | % |
(Amounts
in thousands) | Total | New York | Other | |||||||||
Increase (decrease) due to: | ||||||||||||
Property rentals: | ||||||||||||
Acquisitions,
dispositions and other | $ | 8,399 | $ | 8,173 | $ | 226 | ||||||
Development and redevelopment | 689 | (64 | ) | 753 | ||||||||
Hotel
Pennsylvania | 6,218 | 6,218 | — | |||||||||
Trade shows | 1,684 | — | 1,684 | |||||||||
Same
store operations | 19,704 | 13,628 | 6,076 | |||||||||
36,694 | 27,955 | 8,739 | ||||||||||
Tenant
expense reimbursements: | ||||||||||||
Acquisitions, dispositions and other | (2,673 | ) | (2,673 | ) | — | |||||||
Development
and redevelopment | 1,672 | (37 | ) | 1,709 | ||||||||
Same store operations | 12,261 | 10,916 | 1,345 | |||||||||
11,260 | 8,206 | 3,054 | ||||||||||
Fee
and other income: | ||||||||||||
BMS cleaning fees | 7,267 | 9,577 | (2,310 | ) | ||||||||
Management
and leasing fees | 1,690 | 1,453 | 237 | |||||||||
Lease termination fees | (1,177 | ) | (615 | ) | (562 | ) | ||||||
Other
income | 2,398 | 670 | 1,728 | |||||||||
10,178 | 11,085 | (907 | ) | |||||||||
Total
increase in revenues | $ | 58,132 | $ | 47,246 | $ | 10,886 |
(Amounts in thousands) | Total | New York | Other | ||||||||||
(Decrease)
increase due to: | |||||||||||||
Operating: | |||||||||||||
Acquisitions,
dispositions and other | $ | (3,784 | ) | $ | (3,784 | ) | $ | — | |||||
Development and redevelopment | 843 | 72 | 771 | ||||||||||
Non-reimbursable
expenses, including bad debt reserves | (3,463 | ) | (4,311 | ) | 848 | ||||||||
Hotel Pennsylvania | 2,874 | 2,874 | — | ||||||||||
Trade
shows | 361 | — | 361 | ||||||||||
BMS expenses | 6,900 | 9,118 | (2,218 | ) | |||||||||
Same
store operations | 31,308 | 23,288 | 8,020 | ||||||||||
35,039 | 27,257 | 7,782 | |||||||||||
Depreciation
and amortization: | |||||||||||||
Acquisitions, dispositions and other | (175 | ) | (175 | ) | — | ||||||||
Development
and redevelopment | (349 | ) | (24 | ) | (325 | ) | |||||||
Same store operations | (636 | ) | (3,918 | ) | 3,282 | ||||||||
(1,160 | ) | (4,117 | ) | 2,957 | |||||||||
General
and administrative: | |||||||||||||
Mark-to-market of deferred compensation plan liability | 2,608 | — | 2,608 | (1) | |||||||||
Same
store operations | 6,960 | 4,073 | 2,887 | ||||||||||
9,568 | 4,073 | 5,495 | |||||||||||
Acquisition
and transaction related costs | (5,624 | ) | — | (5,624 | ) | ||||||||
Total
increase in expenses | $ | 37,823 | $ | 27,213 | $ | 10,610 |
(1) | This
increase in expense is entirely offset by a corresponding increase in income from the mark-to-market of the deferred compensation plan assets, a component of “interest and other investment income, net” on our consolidated statements of income. |
(Amounts in thousands, except per share amounts) | Percentage Ownership at | For
the Nine Months Ended September 30, | ||||||||
2017 | 2016 | |||||||||
Our Share of Net (Loss) Income: | ||||||||||
PREIT(1) | 8.0% | $ | (53,480 | ) | $ | (4,763 | ) | |||
UE(2) | 4.5% | 26,311 | 4,523 | |||||||
Alexander's | 32.4% | 24,443 | 25,947 | |||||||
Partially
owned office buildings/land (3) | Various | (23,508 | ) | (29,882 | ) | |||||
Other investments(4) | Various | 31,812 | 8,067 | |||||||
$ | 5,578 | $ | 3,892 |
(1) | Based
on PREIT’s September 29, 2017 quarter ended closing share price of $10.49, the market value (“fair value” pursuant to ASC Topic 323, Investments - Equity Method and Joint Ventures) of our investment in PREIT was $65,563 or $44,465 below the carrying amount on our consolidated balance sheet. We have concluded that our investment in PREIT is “other-than-temporarily” impaired and recorded a $44,465 non-cash impairment loss on our consolidated statements of income. Our conclusion was based on a sustained trading value of PREIT stock below our carrying amount and our inability to forecast a recovery in the near-term. |
(2) | 2017
includes a $21,100 net gain resulting from UE operating partnership unit issuances. |
(3) | Includes interests in 280 Park Avenue, 650 Madison Avenue, One Park Avenue, 666 Fifth Avenue (Office), 7 West 34th Street, 330 Madison Avenue, 512 West 22nd Street, 85 Tenth Avenue and others. |
(4) | Includes interests in Independence Plaza, Fashion Centre Mall/Washington Tower, Rosslyn Plaza, 50-70 West 93rd Street, Toys "R" Us, Inc., and others. In the second quarter of 2017, we recognized $26,687 of net gains, comprised of $15,314
representing our share of a net gain on the sale of Suffolk Downs and $11,373 representing the net gain on repayment of our debt investments in Suffolk Downs JV. See page 58 for details. |
(Amounts
in thousands) | For the Nine Months Ended September 30, | ||||||
2017 | 2016 | ||||||
Net investment income | $ | 16,888 | $ | 12,237 | |||
Net
realized gains on exited investments | 35,861 | 14,676 | |||||
Previously recorded unrealized gains on exited investment | (25,538 | ) | (14,254 | ) | |||
Net unrealized (loss) gain
on held investments | (28,860 | ) | 16,091 | ||||
(Loss) income from real estate fund investments | (1,649 | ) | 28,750 | ||||
Less income attributable to noncontrolling interests
in consolidated subsidiaries | (9,684 | ) | (15,088 | ) | |||
(Loss) income from real estate fund investments attributable to the Operating Partnership (1) | (11,333 | ) | 13,662 | ||||
Less
loss (income) attributable to noncontrolling interests in the Operating Partnership | 706 | (843 | ) | ||||
(Loss) income from real estate fund investments attributable to Vornado | $ | (10,627 | ) | $ | 12,819 |
(1) | Excludes
$3,125 and $2,499 of management and leasing fees for the nine months ended September 30, 2017 and 2016, respectively, which are included as a component of "fee and other income" on our consolidated statements of income. |
(Amounts
in thousands) | For the Nine Months Ended September 30, | ||||||
2017 | 2016 | ||||||
Total revenues | $ | 260,969 | $ | 392,108 | |||
Total
expenses | 211,930 | 331,377 | |||||
49,039 | 60,731 | ||||||
JBG SMITH Properties spin-off transaction costs | (67,045 | ) | (4,597 | ) | |||
Net
gains on sale of real estate and a lease position | 3,797 | 5,074 | |||||
Income (loss) from partially owned assets | 435 | (3,363 | ) | ||||
Impairment losses | — | (161,165 | ) | ||||
Pretax
loss from discontinued operations | (13,774 | ) | (103,320 | ) | |||
Income tax expense | (727 | ) | (884 | ) | |||
Loss from discontinued operations | $ | (14,501 | ) | $ | (104,204 | ) |
(Amounts
in thousands) | New York | theMART | 555 California Street | |||||||||
EBITDA for the nine months ended September 30, 2017 | $ | 853,922 | $ | 72,471 | $ | 35,870 | ||||||
Add-back: | ||||||||||||
Non-property
level overhead expenses included above | 31,630 | 5,632 | — | |||||||||
Less EBITDA from: | ||||||||||||
Acquisitions | (15,211 | ) | 210 | — | ||||||||
Dispositions | (619 | ) | — | — | ||||||||
Development
properties placed into and out of service | (18,966 | ) | — | — | ||||||||
Other non-operating income, net | (3,963 | ) | (19 | ) | — | |||||||
Same
store EBITDA for the nine months ended September 30, 2017 | $ | 846,793 | $ | 78,294 | $ | 35,870 | ||||||
EBITDA
for the nine months ended September 30, 2016 | $ | 977,517 | $ | 70,689 | $ | 35,137 | ||||||
Add-back: | ||||||||||||
Non-property
level overhead expenses included above | 27,557 | 5,064 | 244 | |||||||||
Less EBITDA from: | ||||||||||||
Acquisitions | (60 | ) | — | — | ||||||||
Dispositions,
including net gains on sale | (162,512 | ) | — | — | ||||||||
Development properties placed into and out of service | (24,343 | ) | — | 782 | ||||||||
Other
non-operating loss (income), net | 6,424 | — | (238 | ) | ||||||||
Same store EBITDA for the nine months ended September 30, 2016 | $ | 824,583 | $ | 75,753 | $ | 35,925 | ||||||
Increase
(decrease) in same store EBITDA for the nine months ended September 30, 2017 compared to September 30, 2016 | $ | 22,210 | $ | 2,541 | $ | (55 | ) | |||||
%
increase (decrease) in same store EBITDA | 2.7 | % | (1) | 3.4 | % | (2) | (0.2 | )% |
(1) | Excluding Hotel Pennsylvania,
same store EBITDA increased by 2.3%. |
(2) | The nine months ended September 30, 2017 includes a $2,000 reversal of an expense accrued in 2015. Excluding this amount, same store EBITDA increased by 6.2%. |
(Amounts
in thousands) | New York | theMART | 555 California Street | |||||||||
NOI for the nine months ended September 30, 2017 | $ | 812,334 | $ | 74,859 | $ | 33,647 | ||||||
Less
NOI from: | ||||||||||||
Acquisitions | (13,230 | ) | 210 | — | ||||||||
Dispositions | (619 | ) | — | — | ||||||||
Development
properties placed into and out of service | (5,022 | ) | — | — | ||||||||
Other non-operating income, net | (22,492 | ) | (31 | ) | — | |||||||
Same
store NOI for the nine months ended September 30, 2017 | $ | 770,971 | $ | 75,038 | $ | 33,647 | ||||||
NOI
for the nine months ended September 30, 2016 | $ | 716,315 | $ | 70,914 | $ | 24,010 | ||||||
Less NOI
from: | ||||||||||||
Acquisitions | (13 | ) | — | — | ||||||||
Dispositions | (2,113 | ) | — | — | ||||||||
Development
properties placed into and out of service | (5,947 | ) | — | 782 | ||||||||
Other non-operating income, net | (27,428 | ) | — | (396 | ) | |||||||
Same
store NOI for the nine months ended September 30, 2016 | $ | 680,814 | $ | 70,914 | $ | 24,396 | ||||||
Increase
in same store NOI for the nine months ended September 30, 2017 compared to September 30, 2016 | $ | 90,157 | $ | 4,124 | $ | 9,251 | ||||||
%
increase in same store NOI | 13.2 | % | (1) | 5.8 | % | (2) | 37.9 | % |
(1) | Excluding Hotel Pennsylvania, same
store NOI increased by 12.8%. |
(2) | The nine months ended September 30, 2017 includes a $2,000 reversal of an expense accrued in 2015. Excluding this amount, same store NOI increased by 8.9%. |
(Amounts in thousands) | New York | ||
Net income attributable to the Operating Partnership for the three months ended June 30, 2017 | $ | 96,180 | |
Interest
and debt expense | 78,202 | ||
Depreciation and amortization | 110,449 | ||
Income tax expense | (869 | ) | |
EBITDA for the three months ended June 30, 2017 | $ | 283,962 |
(Amounts in thousands) | New York | theMART | 555
California Street | |||||||||
EBITDA for the three months ended September 30, 2017 | $ | 297,177 | $ | 24,165 | $ | 11,643 | ||||||
Add-back: | ||||||||||||
Non-property
level overhead expenses included above | 9,479 | 1,859 | — | |||||||||
Less EBITDA from: | ||||||||||||
Acquisitions | (226 | ) | 42 | — | ||||||||
Dispositions | (15 | ) | — | — | ||||||||
Development
properties placed into and out of service | (6,228 | ) | — | — | ||||||||
Other non-operating income, net | (1,308 | ) | — | — | ||||||||
Same
store EBITDA for the three months ended September 30, 2017 | $ | 298,879 | $ | 26,066 | $ | 11,643 | ||||||
EBITDA
for the three months ended June 30, 2017 | $ | 283,962 | $ | 24,122 | $ | 12,144 | ||||||
Add-back: | ||||||||||||
Non-property
level overhead expenses included above | 9,908 | 2,063 | — | |||||||||
Less EBITDA from: | ||||||||||||
Acquisitions | (164 | ) | 169 | — | ||||||||
Dispositions | (164 | ) | — | — | ||||||||
Development
properties placed into and out of service | (7,571 | ) | — | — | ||||||||
Other non-operating income, net | (900 | ) | — | — | ||||||||
Same
store EBITDA for the three months ended June 30, 2017 | $ | 285,071 | $ | 26,354 | $ | 12,144 | ||||||
Increase
(decrease) in same store EBITDA for the three months ended September 30, 2017 compared to June 30, 2017 | $ | 13,808 | $ | (288 | ) | $ | (501 | ) | ||||
%
increase (decrease) in same store EBITDA | 4.8 | % | (1) | (1.1 | )% | (4.1 | )% |
(1) | Excluding Hotel Pennsylvania, same store EBITDA
increased by 5.3%. |
New
York | theMART | 555 California Street | ||||||||||
NOI for the three months ended September 30, 2017 | $ | 280,044 | $ | 25,422 | $ | 11,013 | ||||||
Less
NOI from: | ||||||||||||
Acquisitions | (76 | ) | 42 | — | ||||||||
Dispositions | (15 | ) | — | — | ||||||||
Development
properties placed into and out of service | (1,779 | ) | — | — | ||||||||
Other non-operating income, net | (6,247 | ) | — | — | ||||||||
Same
store NOI for the three months ended September 30, 2017 | $ | 271,927 | $ | 25,464 | $ | 11,013 | ||||||
NOI
for the three months ended June 30, 2017 | $ | 270,515 | $ | 24,901 | $ | 11,259 | ||||||
Less NOI from: | ||||||||||||
Acquisitions | (63 | ) | 170 | — | ||||||||
Dispositions | (164 | ) | — | — | ||||||||
Development
properties placed into and out of service | (1,774 | ) | — | — | ||||||||
Other non-operating income, net | (6,773 | ) | — | — | ||||||||
Same
store NOI for the three months ended June 30, 2017 | $ | 261,741 | $ | 25,071 | $ | 11,259 | ||||||
Increase
(decrease) in same store NOI for the three months ended September 30, 2017 compared to June 30, 2017 | $ | 10,186 | $ | 393 | $ | (246 | ) | |||||
%
increase (decrease) in same store NOI | 3.9 | % | (1) | 1.6 | % | (2.2 | )% |
(1) | Excluding Hotel Pennsylvania, same store NOI increased
by 4.4%. |
(Amounts
in thousands) | Total | New York | theMART | 555 California Street | Other | |||||||||||||||
Expenditures to maintain assets | $ | 80,195 | $ | 62,199 | $ | 6,202 | $ | 4,601 | $ | 7,193 | ||||||||||
Tenant
improvements | 75,367 | 33,251 | 7,516 | 3,454 | 31,146 | |||||||||||||||
Leasing
commissions | 24,199 | 16,690 | 1,094 | 770 | 5,645 | |||||||||||||||
Non-recurring
capital expenditures | 62,292 | 50,717 | 988 | 6,403 | 4,184 | |||||||||||||||
Total
capital expenditures and leasing commissions (accrual basis) | 242,053 | 162,857 | 15,800 | 15,228 | 48,168 | |||||||||||||||
Adjustments
to reconcile to cash basis: | ||||||||||||||||||||
Expenditures in the current period applicable to prior periods | 106,038 | 62,948 | 7,992 | 9,777 | 25,321 | |||||||||||||||
Expenditures
to be made in future periods for the current period | (113,704 | ) | (71,138 | ) | (7,172 | ) | 4,373 | (39,767 | ) | |||||||||||
Total
capital expenditures and leasing commissions (cash basis) | $ | 234,387 | $ | 154,667 | $ | 16,620 | $ | 29,378 | $ | 33,722 | (1) | |||||||||
Tenant
improvements and leasing commissions: | ||||||||||||||||||||
Per square foot per annum | $ | 9.30 | $ | 9.56 | $ | 6.12 | $ | 11.89 | n/a | |||||||||||
Percentage
of initial rent | 11.1 | % | 10.6 | % | 12.7 | % | 14.9 | % | n/a |
(1) | Effective
July 17, 2017, the date of the spin-off our Washington, DC segment, capital expenditures and leasing commissions by our former Washington, DC segment have been reclassified to the Other segment. We have reclassified the prior period capital expenditures and leasing commissions to conform to the current period presentation. |
(Amounts
in thousands) | Total | New York | theMART | 555 California Street | Other | |||||||||||||||
220 Central Park South | $ | 196,063 | $ | — | $ | — | $ | — | $ | 196,063 | ||||||||||
606
Broadway | 11,796 | 11,796 | — | — | — | |||||||||||||||
315/345
Montgomery Street | 9,603 | — | — | 9,603 | — | |||||||||||||||
90
Park Avenue | 6,831 | 6,831 | — | — | — | |||||||||||||||
Penn
Plaza | 6,303 | 6,303 | — | — | — | |||||||||||||||
theMART | 6,163 | — | 6,163 | — | — | |||||||||||||||
304
Canal Street | 3,627 | 3,627 | — | — | — | |||||||||||||||
Other | 34,330 | 5,709 | 509 | — | 28,112 | (1) | ||||||||||||||
$ | 274,716 | $ | 34,266 | $ | 6,672 | $ | 9,603 | $ | 224,175 |
(1) | Effective
July 17, 2017, the date of the spin-off of our Washington, DC segment, capital expenditures and leasing commissions by our former Washington, DC segment have been reclassified to the Other segment. We have reclassified the prior period capital expenditures and leasing commissions to conform to the current period presentation. |
(Amounts
in thousands) | Total | New York | theMART | 555 California Street | Other | |||||||||||||||
Expenditures to maintain assets | $ | 68,381 | $ | 39,001 | $ | 10,092 | $ | 5,208 | $ | 14,080 | ||||||||||
Tenant
improvements | 62,556 | 48,175 | 2,542 | 3,201 | 8,638 | |||||||||||||||
Leasing
commissions | 30,462 | 26,214 | 354 | 951 | 2,943 | |||||||||||||||
Non-recurring
capital expenditures | 27,503 | 20,224 | 182 | 874 | 6,223 | |||||||||||||||
Total
capital expenditures and leasing commissions (accrual basis) | 188,902 | 133,614 | 13,170 | 10,234 | 31,884 | |||||||||||||||
Adjustments
to reconcile to cash basis: | ||||||||||||||||||||
Expenditures in the current period applicable to prior periods | 199,260 | 100,542 | 25,335 | 9,209 | 64,174 | |||||||||||||||
Expenditures
to be made in future periods for the current period | (80,348 | ) | (63,919 | ) | 2,139 | (5,018 | ) | (13,550 | ) | |||||||||||
Total
capital expenditures and leasing commissions (cash basis) | $ | 307,814 | $ | 170,237 | $ | 40,644 | $ | 14,425 | $ | 82,508 | (1) | |||||||||
Tenant
improvements and leasing commissions: | ||||||||||||||||||||
Per square foot per annum | $ | 6.88 | $ | 7.02 | $ | 4.04 | $ | 7.49 | n/a | |||||||||||
Percentage
of initial rent | 9.0 | % | 8.9 | % | 7.9 | % | 9.5 | % | n/a |
(1) | Effective
July 17, 2017, the date of the spin-off of our Washington, DC segment, capital expenditures and leasing commissions by our former Washington, DC segment have been reclassified to the Other segment. We have reclassified the prior period capital expenditures and leasing commissions to conform to the current prior period presentation. |
(Amounts
in thousands) | Total | New York | theMART | 555 California Street | Other | |||||||||||||||
220 Central Park South | $ | 213,170 | $ | — | $ | — | $ | — | $ | 213,170 | ||||||||||
90
Park Avenue | 28,288 | 28,288 | — | — | — | |||||||||||||||
640
Fifth Avenue | 23,415 | 23,415 | — | — | — | |||||||||||||||
theMart | 21,613 | — | 21,613 | — | — | |||||||||||||||
Penn
Plaza | 10,195 | 10,195 | — | — | — | |||||||||||||||
Wayne
Towne Center | 7,910 | — | — | — | 7,910 | |||||||||||||||
330
West 34th Street | 3,968 | 3,968 | — | — | — | |||||||||||||||
Other | 118,082 | 8,165 | 769 | 879 | 108,269 | (1) | ||||||||||||||
$ | 426,641 | $ | 74,031 | $ | 22,382 | $ | 879 | $ | 329,349 |
(1) | Effective
July 17, 2017, the date of the spin-off our Washington, DC segment, capital expenditures and leasing commissions by our former Washington, DC segment have been reclassified to the Other segment. We have reclassified the prior period capital expenditures and leasing commissions to conform to the current prior period presentation. |
(Amounts in thousands, except per share amounts) | For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Reconciliation
of our net (loss) income to FFO: | |||||||||||||||
Net (loss) income attributable to common shareholders | $ | (29,026 | ) | $ | 66,125 | $ | 134,698 | $ | 172,425 | ||||||
Per
diluted share | $ | (0.15 | ) | $ | 0.35 | $ | 0.71 | $ | 0.91 | ||||||
FFO
adjustments: | |||||||||||||||
Depreciation and amortization of real property | $ | 102,953 | $ | 130,892 | $ | 361,949 | $ | 398,231 | |||||||
Net
gains on sale of real estate | (1,530 | ) | — | (3,797 | ) | (161,721 | ) | ||||||||
Real estate impairment losses | — | — | — | 160,700 | |||||||||||
Proportionate
share of adjustments to equity in net (loss) income of partially owned entities to arrive at FFO: | |||||||||||||||
Depreciation and amortization of real property | 31,997 | 40,281 | 108,753 | 117,635 | |||||||||||
Net
gains on sale of real estate | 8 | (2,522 | ) | (17,184 | ) | (2,841 | ) | ||||||||
Real estate impairment losses | 4,329 | 1,134 | 7,547 | 5,536 | |||||||||||
137,757 | 169,785 | 457,268 | 517,540 | ||||||||||||
Noncontrolling
interests' share of above adjustments | (8,572 | ) | (10,403 | ) | (28,444 | ) | (31,872 | ) | |||||||
FFO adjustments, net | $ | 129,185 | $ | 159,382 | $ | 428,824 | $ | 485,668 | |||||||
FFO
attributable to common shareholders | $ | 100,159 | $ | 225,507 | $ | 563,522 | $ | 658,093 | |||||||
Convertible
preferred share dividends | 19 | 22 | 59 | 65 | |||||||||||
Earnings allocated to Out-Performance Plan units | — | — | 850 | 722 | |||||||||||
FFO
attributable to common shareholders plus assumed conversions | $ | 100,178 | $ | 225,529 | $ | 564,431 | $ | 658,880 | |||||||
Per
diluted share | $ | 0.52 | $ | 1.19 | $ | 2.95 | $ | 3.47 | |||||||
Reconciliation
of Weighted Average Shares | |||||||||||||||
Weighted average common shares outstanding | 189,593 | 188,901 | 189,401 | 188,778 | |||||||||||
Effect
of dilutive securities: | |||||||||||||||
Employee stock options and restricted share awards | 1,254 | 1,147 | 1,553 | 1,067 | |||||||||||
Convertible
preferred shares | 46 | 42 | 47 | 42 | |||||||||||
Out-Performance Plan units | — | — | 303 | 242 | |||||||||||
Denominator
for FFO per diluted share | 190,893 | 190,090 | 191,304 | 190,129 |
(Amounts in thousands, except per share
and per unit amounts) | 2017 | 2016 | |||||||||||||
September 30, Balance | Weighted Average Interest Rate | Effect of 1% Change In Base Rates | December
31, Balance | Weighted Average Interest Rate | |||||||||||
Consolidated debt: | |||||||||||||||
Variable
rate | $ | 3,112,877 | 3.03% | $ | 31,129 | $ | 3,217,763 | 2.45% | |||||||
Fixed
rate | 6,316,886 | 3.65% | — | 6,329,547 | 3.65% | ||||||||||
$ | 9,429,763 | 3.45% | 31,129 | $ | 9,547,310 | 3.25% | |||||||||
Pro
rata share of debt of non-consolidated entities (non-recourse): | |||||||||||||||
Variable rate – excluding Toys "R" Us, Inc. | $ | 1,378,765 | 3.02% | 13,788 | $ | 1,092,326 | 2.50% | ||||||||
Variable
rate – Toys "R" Us, Inc. | 1,248,970 | 6.91% | 12,490 | 1,162,072 | 6.05% | ||||||||||
Fixed rate - excluding Toys "R"
Us, Inc. | 2,088,979 | 5.03% | — | 1,969,918 | 5.15% | ||||||||||
Fixed rate - Toys "R" Us, Inc. | 466,313 | 10.45% | — | 671,181 | 9.42% | ||||||||||
$ | 5,183,027 | 5.44% | 26,278 | $ | 4,895,497 | 5.36% | |||||||||
Noncontrolling
interests' share of consolidated subsidiaries | (1,438 | ) | |||||||||||||
Total change in annual net income attributable to the Operating Partnership | 55,969 | ||||||||||||||
Noncontrolling
interests’ share of the Operating Partnership | (3,481 | ) | |||||||||||||
Total change in annual net income attributable to Vornado | $ | 52,488 | |||||||||||||
Total
change in annual net income attributable to the Operating Partnership per diluted Class A unit | $ | 0.28 | |||||||||||||
Total change in annual net income attributable to Vornado per diluted share | $ | 0.27 |
Exhibit No. | ||||
15.1 | — | |||
15.2 | — | |||
31.1 | — | |||
31.2 | — | |||
31.3 | — | |||
31.4 | — | |||
32.1 | — | |||
32.2 | — | |||
32.3 | — | |||
32.4 | — | |||
101.INS | — | XBRL Instance Document of Vornado Realty Trust and Vornado Realty L.P. | ||
101.SCH | — | XBRL Taxonomy Extension Schema of Vornado Realty Trust and Vornado Realty L.P. | ||
101.CAL | — | XBRL
Taxonomy Extension Calculation Linkbase of Vornado Realty Trust and Vornado Realty L.P. | ||
101.DEF | — | XBRL Taxonomy Extension Definition Linkbase of Vornado Realty Trust and Vornado Realty L.P. | ||
101.LAB | — | XBRL Taxonomy Extension Label Linkbase of Vornado Realty Trust and Vornado Realty L.P. | ||
101.PRE | — | XBRL
Taxonomy Extension Presentation Linkbase of Vornado Realty Trust and Vornado Realty L.P. |
VORNADO
REALTY TRUST | ||
(Registrant) | ||
Date: October 30, 2017 | By: | /s/ Matthew
Iocco |
Matthew Iocco, Chief Accounting Officer (duly authorized officer and principal accounting officer) |
VORNADO
REALTY L.P. | ||
(Registrant) | ||
Date: October 30, 2017 | By: | /s/ Matthew
Iocco |
Matthew Iocco, Chief Accounting Officer of Vornado Realty Trust, sole General Partner of Vornado Realty L.P. (duly authorized officer and principal accounting officer) |
This ‘10-Q’ Filing | Date | Other Filings | ||
---|---|---|---|---|
1/1/19 | ||||
12/15/18 | ||||
1/1/18 | ||||
12/15/17 | ||||
Filed on: | 10/30/17 | 8-K | ||
10/17/17 | 8-K | |||
For Period end: | 9/30/17 | |||
9/29/17 | ||||
9/18/17 | ||||
8/23/17 | ||||
7/19/17 | 4 | |||
7/18/17 | ||||
7/17/17 | 4, 8-K | |||
7/1/17 | ||||
6/30/17 | 10-Q | |||
6/20/17 | ||||
6/15/17 | ||||
6/9/17 | ||||
6/1/17 | UPLOAD | |||
5/26/17 | ||||
5/9/17 | ||||
2/13/17 | 10-K, 8-K, SC 13G/A | |||
1/1/17 | ||||
12/31/16 | 10-K, 10-K/A | |||
12/15/16 | 8-K | |||
12/1/16 | ||||
9/30/16 | 10-Q | |||
9/1/16 | 25-NSE | |||
6/30/16 | 10-Q | |||
12/31/15 | 10-K, 10-K/A, 5 | |||
List all Filings |