# VORNADO REALTY TRUST (VNO) FY 2024 MD&A

Verbatim Item 7 Management's Discussion and Analysis from VORNADO REALTY TRUST's 10-K for fiscal year 2024.

SEC filing source: https://www.sec.gov/Archives/edgar/data/899689/000089968925000004/vno-20241231.htm
Accession: 0000899689-25-000004
Filing date: 2025-02-10
Report date: 2024-12-31
Extracted structurally from real Item 7 body heading to real Item 7A/8 boundary.
Confidence: high

Company profile: /company/VNO/
All MD&A years: /company/VNO/mda/
Previous year: /company/VNO/mda/fy2023/ (FY 2023)
Next year: /company/VNO/mda/fy2025/ (FY 2025)

ITEM 7.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

[[GREPCENT_TABLE]]
[["","Page Number"],["Overview","35"],["Critical Accounting Estimates","42"],["Net Operating Income At Share by Segment for the Years Ended December 31, 2024 and 2023","43"],["Results of Operations for the Year Ended December 31, 2024 Compared to December 31, 2023","46"],["Related Party Transactions","49"],["Liquidity and Capital Resources","50"],["Funds From Operations for the Years Ended December 31, 2024 and 2023","56"]]
[[/GREPCENT_TABLE]]

34

Introduction

The following discussion should be read in conjunction with the financial statements and related notes included under Part II, Item 8 of this Annual Report on Form 10-K.

Our Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") within this section is focused on the years ended December 31, 2024 and 2023, including year-to-year comparisons between these years. Our MD&A for the year ended December 31, 2022, including year-to-year comparisons between 2023 and 2022, can be found in Part II, Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations in the Company's Annual Report on Form 10-K for the year ended December 31, 2023.

Overview

Vornado Realty Trust (“Vornado”) is a fully‑integrated real estate investment trust (“REIT”) and conducts its business through, and substantially all of its interests in properties are held by, Vornado Realty L.P., (the “Operating Partnership”) a Delaware limited partnership. Accordingly, Vornado’s cash flow and ability to pay dividends to its shareholders are dependent upon the cash flow of the Operating Partnership and the ability of its direct and indirect subsidiaries to first satisfy their obligations to creditors. Vornado is the sole general partner of and owned approximately 91.4% of the common limited partnership interest in the Operating Partnership as of December 31, 2024. All references to the “Company,” “we,” “us” and “our” mean, collectively, Vornado, the Operating Partnership and those subsidiaries consolidated by Vornado.

We own and operate office and retail properties with a concentration in the New York metropolitan area. In addition, we have a 32.4% interest in Alexander’s, Inc. (“Alexander’s”) (NYSE: ALX), which owns five properties in the greater New York metropolitan area, as well as interests in other real estate and investments.

Our business objective is to maximize Vornado shareholder value, which we measure by the total return provided to our shareholders. Below is a table comparing Vornado’s performance to the FTSE Office and the MSCI US REIT Index (“MSCI”) for the following periods ended December 31, 2024:

[[GREPCENT_TABLE]]
[["","Total Return(1)"],["","Vornado","","FTSE Office","","MSCI"],["Three-month","8.5","%","","(0.7","%)","","(6.1","%)"],["One-year","51.3","%","","21.5","%","","8.8","%"],["Three-year","12.2","%","","(22.7","%)","","(6.6","%)"],["Five-year","(21.4","%)","","(23.0","%)","","23.5","%"],["Ten-year","(26.7","%)","","3.3","%","","73.5","%"]]
[[/GREPCENT_TABLE]]

________________________________________

(1)Past performance is not necessarily indicative of future performance.

We intend to achieve this objective by continuing to pursue our investment philosophy and to execute our operating strategies through:

•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;

•developing and redeveloping properties to increase returns and maximize value; and

•investing in operating companies that have a significant real estate component.

We expect to finance our growth, acquisitions and investments using internally generated funds and proceeds from asset sales and by accessing the public and private capital markets. We may also offer Vornado common or preferred shares or Operating Partnership units in exchange for property and may repurchase or otherwise reacquire these securities in the future.

We compete with a large number of real estate investors, property owners and developers, some of whom may be willing to accept lower returns on their investments. Principal factors of competition are rents charged, tenant concessions offered, attractiveness of location, the quality of the property and the breadth and the quality of services provided. Our success depends upon, among other factors, trends of the global, national, regional and local economies, the financial condition and operating results of current and prospective tenants and customers, availability and cost of capital, construction and renovation costs, taxes, governmental regulations, legislation, population and employment trends. See “Risk Factors” in Item 1A for additional information regarding these factors.

Our business has been, and may continue to be, affected by interest rates fluctuations, the effects of inflation and other uncertainties including the potential for an economic downturn. These factors could have a material impact on our business, financial condition, results of operations and cash flows.

35

Overview - continued

Vornado Realty Trust

Year Ended December 31, 2024 Financial Results Summary

Net income attributable to common shareholders for the year ended December 31, 2024 was $8,275,000, or $0.04 per diluted share, compared to $43,378,000, or $0.23 per diluted share, for the year ended December 31, 2023. 

Funds from operations ("FFO") attributable to common shareholders plus assumed conversions for the year ended December 31, 2024 was $470,021,000, or $2.37 per diluted share, compared to $503,792,000, or $2.59 per diluted share, for the year ended December 31, 2023. The years ended December 31, 2024 and 2023 include certain items that impact FFO, which are listed in the table below. The aggregate of these items, net of amounts attributable to noncontrolling interests, increased FFO by $22,950,000, or $0.11 per diluted share, for the year ended December 31, 2024 and decreased FFO by $4,359,000, or $0.02 per diluted share, for the year ended December 31, 2023.

The following table reconciles the difference between our FFO attributable to common shareholders plus assumed conversions and our FFO attributable to common shareholders plus assumed conversions, as adjusted:

[[GREPCENT_TABLE]]
[["(Amounts in thousands)","For the Year Ended December 31,"],["","2024","","2023"],["Certain (income) expense items that impact FFO attributable to common shareholders plus assumed conversions:"],["Our share of the gain on the discounted extinguishment of the 280 Park Avenue mezzanine loan","$","(31,215)","","","$","\u2014"],["Deferred tax liability on our investment in the Farley Building (held through a taxable REIT subsidiary)","14,353","","","11,722"],["After-tax net gain on sale of 220 Central Park South (\"220 CPS\") condominium units and ancillary amenities","(13,069)","","","(11,959)"],["Credit losses on investments","\u2014","","","8,269"],["Other","5,000","","","(3,336)"],["","(24,931)","","","4,696"],["Noncontrolling interests' share of above adjustments on a dilutive basis","1,981","","","(337)"],["Total of certain (income) expense items that impact FFO attributable to common shareholders plus assumed conversions, net","$","(22,950)","","","$","4,359"]]
[[/GREPCENT_TABLE]]

36

Overview - continued

Same Store Net Operating Income ("NOI") At Share

The percentage decrease in same store NOI at share and same store NOI at share - cash basis of our New York segment, THE MART and 555 California Street are below.

[[GREPCENT_TABLE]]
[["Year Ended December 31, 2024 compared to December 31, 2023:","","Total","","New York","","THE MART","","555 California Street(2)"],["Same store NOI at share % decrease","","(6.8)","%","","(4.7)","%","","(17.8)","%","(1)","(21.9","%)"],["Same store NOI at share - cash basis % decrease","","(4.5)","%","","(3.3)","%","","(10.6)","%","","(13.2","%)"]]
[[/GREPCENT_TABLE]]

________________________________________

(1)2024 includes a $4,560,000 write-off of a receivable arising from the straight-lining of rents due to the tenant being deemed uncollectible.

(2)2023 includes our $14,103,000 share of the receipt of a tenant settlement, net of legal expenses.

Calculations of same store NOI at share, reconciliations of our net income to NOI at share, NOI at share - cash basis and FFO and the reasons we consider these non-GAAP financial measures useful are provided in the following pages of Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Dividends

On December 5, 2024, Vornado’s Board of Trustees declared a dividend of $0.74 per common share for 2024. We anticipate that our common share dividend policy for 2025 will be to pay one common share dividend in the fourth quarter.

Dispositions

220 Central Park South

During the year ended December 31, 2024, we closed on the sale of two condominium units at 220 CPS for net proceeds of $31,605,000, resulting in a financial statement net gain of $15,175,000 which is included in "net gains on disposition of wholly owned and partially owned assets" on our consolidated statements of income. In connection with these sales, $2,106,000 of income tax expense was recognized on our consolidated statements of income.

On January 17, 2025, we closed on the sale of a condominium unit at 220 CPS for net proceeds of $11,695,000; three units remain unsold.

50-70 West 93rd Street

On May 13, 2024, we sold our 49.9% interest in 50-70 West 93rd Street to our joint venture partner. We received net proceeds of $2,000,000 after deducting our share of the existing $83,500,000 mortgage loan, which was scheduled to mature in December 2024, resulting in a net gain of $873,000. The net gain is included in "net gains on disposition of wholly owned and partially owned assets" on our consolidated statements of income.

666 Fifth Avenue (Fifth Avenue and Times Square JV)

On January 8, 2025, the Fifth Avenue and Times Square JV completed the sale to UNIQLO of the portion of its U.S. flagship store at 666 Fifth Avenue for $350,000,000 and realized net proceeds of $342,000,000. The financial statement gain, which will be recognized in the first quarter of 2025, will be approximately $76,000,000. The net proceeds from the sale were used to partially redeem Vornado’s preferred equity on the asset.

Acquisitions

Investment in Loan

On August 6, 2024, we purchased a $50,000,000 B-Note secured by a Midtown Manhattan property at par. The B-Note, together with the $35,000,000 A-Note, is in default. The B-Note accrues interest at 5.25% plus 4.00% default interest. The $50,000,000 B-Note investment was recorded to “other assets” on our consolidated balance sheets.

Alexander’s

On May 3, 2024, Alexander’s, in which we own a 32.4% common equity interest, and Bloomberg L.P. reached an agreement to extend the leases covering approximately 947,000 square feet at 731 Lexington Avenue that were scheduled to expire in February 2029 for a term of eleven years to February 2040.

37

Overview - continued

Financings

280 Park Avenue

On April 4, 2024, a joint venture, in which we have a 50% interest, amended and extended the $1,075,000,000 mortgage loan on 280 Park Avenue. The maturity date on the amended loan was extended to September 2026, with options to fully extend to September 2028, subject to certain conditions. The interest rate on the amended loan remains at SOFR plus 1.78%. On July 8, 2024, the joint venture swapped the interest rate to a fixed rate of 5.84% through September 2028. Additionally, on April 4, 2024, the joint venture amended and extended the $125,000,000 mezzanine loan and subsequently repaid the loan for $62,500,000. In connection with the repayment of the mezzanine loan, we recognized our $31,215,000 share of the debt extinguishment gain which is included in “income (loss) from partially owned entities” on our consolidated statements of income.

435 Seventh Avenue

On April 9, 2024, we completed a $75,000,000 refinancing of 435 Seventh Avenue, of which $37,500,000 is recourse to the Operating Partnership. The interest-only loan bears a rate of SOFR plus 2.10% and matures in April 2028. The interest rate on the loan was swapped to a fixed rate of 6.96% through April 2026. The loan replaces the previous $95,696,000 fully recourse loan, which bore interest at SOFR plus 1.41%.

Unsecured Revolving Credit Facility

On May 3, 2024, we extended one of our two unsecured revolving credit facilities to April 2029 (as fully extended). The new $915,000,000 facility replaced the $1.25 billion facility that was due to mature in April 2026. The new facility currently bears interest at a rate of SOFR plus 1.20% with a facility fee of 25 basis points. Our $1.25 billion revolving credit facility matures in December 2027 (as fully extended) and has an interest rate of SOFR plus 1.15% and a facility fee of 25 basis points.

640 Fifth Avenue (Fifth Avenue and Times Square JV)

On June 10, 2024, the Fifth Avenue and Times Square JV completed a $400,000,000 refinancing of 640 Fifth Avenue. The non-recourse loan matures in July 2029, bears interest at a fixed rate of 7.47% and amortizes at $7,000,000 per annum. The loan replaces the previous $500,000,000 loan, which the joint venture paid down by $100,000,000. The previous loan was fully recourse to the Operating Partnership and bore interest at SOFR plus 1.11%.

606 Broadway

On September 5, 2024, the $74,119,000 non-recourse mortgage loan on 606 Broadway, in which we hold a 50% interest, matured and was not repaid, at which time the lender declared an event of default. As of December 31, 2024, the property has a carrying value of $53,886,000, which is after an impairment charge recorded in the fourth quarter of 2023. We consolidate the joint venture. The loan currently bears interest at a floating rate of SOFR plus 1.91% (6.39% as of December 31, 2024) and provides for additional default interest of 3.00%.

85 Tenth Avenue

On September 24, 2024, a joint venture, in which we have a 49.9% interest, modified the terms of the $625,000,000 mortgage loan on 85 Tenth Avenue. Per the original loan agreement, the mortgage loan is comprised of a (i) $396,000,000 3.82% senior note, (ii) $129,000,000 5.20% mezzanine A note and (iii) $100,000,000 6.60% mezzanine B note. The modification provides for the interest payments due under the mezzanine notes to be deferred until the December 2026 loan maturity. The deferred amounts will not accrue additional interest. The cash available from the deferred interest payments will be used to fund leasing costs at the property. At loan maturity, if there is no event of default, repayment of 50% of the accrued mezzanine interest will be waived.

Alexander's

On September 30, 2024, Alexander’s, in which we own a 32.4% common equity interest, completed a $400,000,000 refinancing of the office condominium portion of 731 Lexington Avenue, the Bloomberg LP headquarters building. The interest-only loan carries a fixed rate of 5.04% and matures in October 2028. The loan is prepayable, at Alexander’s option, with no penalty, beginning in October 2026. The loan replaces the previous $490,000,000 loan on the office condominium, that bore interest at the Prime Rate and was scheduled to mature in October 2024.

Senior Unsecured Notes due 2025

We repaid our $450,000,000 3.50% senior unsecured notes on their January 15, 2025 maturity date.

38

Overview - continued

Financings - continued

Interest Rate Hedging

We entered into the following interest rate swap and cap arrangements during the year ended December 31, 2024. See page 58, Part II, Item 7A, Quantitative and Qualitative Disclosures About Market Risk - Derivatives and Hedging, in this Annual Report on Form 10-K for further information on our hedging instruments.

[[GREPCENT_TABLE]]
[["(Amounts in thousands)","","Notional Amount (at share)","","All-In Swapped Rate","","Expiration Date","","Variable Rate Spread"],["Interest rate swaps:"],["280 Park Avenue (50.0% interest)","","$","537,500","","","5.84%","","09/28","","S+178"],["PENN 11(1)","","250,000","","","6.21%","","10/25","","S+206"],["435 Seventh Avenue","","75,000","","","6.96%","","04/26","","S+210"],["","","","","Index Strike Rate"],["Interest rate caps:"],["61 Ninth Avenue (45.1% interest)","","$","75,543","","","4.39%","","01/26","","S+146"],["Rego Park II (32.4% interest)","","65,624","","","4.15%","","12/25","","S+145"]]
[[/GREPCENT_TABLE]]

________________________

(1)Together with the existing $250,000 swap arrangement on the $500,000 PENN 11 mortgage loan, the loan will bear interest at an all-in swapped rate of 6.28% through October 2025.     

39

Overview - continued

Leasing Activity For the Year Ended December 31, 2024

The leasing activity and related statistics below are based on leases signed during the period and are not intended to coincide with the commencement of rental revenue in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Second generation relet space represents square footage that has not been vacant for more than nine months and tenant improvements and leasing commissions are based on our share of square feet leased during the period.

[[GREPCENT_TABLE]]
[["(Square feet in thousands)","","New York","","","","555 California Street"],["","","Office","","Retail","","THE MART"],["Year Ended December 31, 2024"],["Total square feet leased","","2,650","","","187","","","386","","","215"],["Our share of square feet leased:","","1,653","","","161","","","386","","","152"],["Initial rent(1)","","$","104.49","","","$","160.01","","","$","52.88","","","$","102.80"],["Weighted average lease term (years)","","8.4","","","9.4","","","7.5","","","7.6"],["Second generation relet space:"],["Square feet","","1,218","","","52","","","247","","","148"],["GAAP basis:"],["Straight-line rent(2)","","$","103.06","","","$","312.43","","","$","54.38","","","$","103.05"],["Prior straight-line rent","","$","92.97","","","$","227.98","","","$","51.57","","","$","88.21"],["Percentage increase","","10.9","%","","37.0","%","","5.4","%","","16.8","%"],["Cash basis (non-GAAP):"],["Initial rent(1)","","$","107.99","","","$","294.38","","","$","55.76","","","$","101.31"],["Prior escalated rent","","$","105.37","","","$","271.77","","","$","57.37","","","$","101.45"],["Percentage increase (decrease)","","2.5","%","","8.3","%","","(2.8)","%","","(0.1)","%"],["Tenant improvements and leasing commissions:"],["Per square foot","","$","81.56","","","$","82.50","","","$","91.00","","","$","110.36"],["Per square foot per annum","","$","9.71","","","$","8.78","","","$","12.13","","","$","14.52"],["Percentage of initial rent","","9.3","%","","5.5","%","","22.9","%","","14.1","%"]]
[[/GREPCENT_TABLE]]
_______________________________

(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.

40

Overview - continued

Square footage (in service) and Occupancy as of December 31, 2024

[[GREPCENT_TABLE]]
[["(Square feet in thousands)","","","","Square Feet (in service)"],["","Number of properties","","","Total Portfolio","","Our Share","","Occupancy %"],["New York:"],["Office","30","(1)","","18,714","","","16,024","","","88.8","%"],["Retail (includes retail properties that are in the base of our office properties)","49","(1)","","2,387","","","1,943","","","73.7","%"],["Residential - 1,642 units(2)","2","(1)","","1,196","","","604","","","96.6","%","(2)"],["Alexander's","5","","","2,067","","","670","","","99.1","%","(2)"],["","","","","24,364","","","19,241","","","87.6","%"],["Other:"],["THE MART","3","","","3,703","","","3,694","","","80.1","%"],["555 California Street","3","","","1,821","","","1,275","","","92.0","%"],["Other","11","","","2,537","","","1,202","","","86.5","%"],["","","","","8,061","","","6,171"],["Total square feet as of December 31, 2024","","","","32,425","","","25,412"]]
[[/GREPCENT_TABLE]]
________________________________________

See notes below.

Square footage (in service) and Occupancy as of December 31, 2023

[[GREPCENT_TABLE]]
[["(Square feet in thousands)","","","","Square Feet (in service)"],["","Number of properties","","","Total Portfolio","","Our Share","","Occupancy %"],["New York:"],["Office","30","","(1)","","18,699","","","16,001","","","90.7","%"],["Retail (includes retail properties that are in the base of our office properties)","50","","(1)","","2,123","","","1,684","","","74.9","%"],["Residential - 1,974 units(2)","5","","(1)","","1,479","","","745","","","96.8","%","(2)"],["Alexander's","5","","","","2,331","","","755","","","92.6","%","(2)"],["","","","","24,632","","","19,185","","","89.4","%"],["Other:"],["THE MART","3","","","3,688","","","3,679","","","79.2","%"],["555 California Street","3","","","1,819","","","1,274","","","94.5","%"],["Other","11","","","2,537","","","1,202","","","91.9","%"],["","","","","8,044","","","6,155"],["Total square feet as of December 31, 2023","","","","32,676","","","25,340"]]
[[/GREPCENT_TABLE]]

________________________________________

(1)Reflects the Office, Retail and Residential space within our 64 and 65 total New York properties as of December 31, 2024 and 2023, respectively.

(2)The Alexander Apartment Tower (312 units) is reflected in Residential unit count and occupancy.

41

Critical Accounting Estimates

In preparing the consolidated financial statements we have made estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Accounting estimates are deemed critical if they involve a significant level of estimation uncertainty and have had or are reasonably likely to have a material impact on our financial condition or results of operations. Below is a summary of the critical accounting estimates used in the preparation of our consolidated financial statements. A discussion of our accounting policies is included in Note 2 - Basis of Presentation and Significant Accounting Policies to our consolidated financial statements in this Annual Report on Form 10-K.

Acquisitions of Real Estate

Upon the acquisition of real estate, we assess whether the transaction should be accounted for as an asset acquisition or as a business combination. Acquisitions of integrated sets of assets and activities that do not meet the definition of a business are accounted for as asset acquisitions. Our acquisitions of real estate generally will not meet the definition of a business because substantially all of the fair value is concentrated in a single identifiable asset or group of similar identifiable assets (i.e. land, buildings, and related identified intangible assets).

We assess the fair value of acquired assets (including land, buildings and improvements, identified intangibles, such as acquired above and below-market leases, acquired in-place leases and tenant relationships) and acquired liabilities and we allocate the purchase price on a relative fair value basis. We assess fair value based on estimated cash flow projections based on a number of factors such as historical operating results, known trends, and market/economic conditions and make key assumptions regarding the discount and capitalization rates used in our analyses. The use of different assumptions to value the acquired properties and allocate value between land and building could affect the revenues recognized over the terms of the leases at our properties and the expenses recognized over the property's estimated remaining useful life on our consolidated statements of income.

Impairment Analyses for Investments in Real Estate and Unconsolidated Partially Owned Entities

Our investments in consolidated properties, including any related right-of-use assets and intangible assets, and unconsolidated partially owned entities are individually reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. For our unconsolidated partially owned entities, we consider various qualitative factors to determine if a decrease in the value of our investment is other-than-temporary during our intended holding period. Assessing impairment can be complex and involves a high degree of subjectivity in determining if impairment indicators are present and in estimating the future undiscounted cash flows or the fair value of an asset. In particular, these estimates are sensitive to significant assumptions, including the estimation of future rental revenues, operating expenses, capital expenditures, discount rates and capitalization rates and our intent and ability to hold the related asset, all of which could be affected by our expectations about future market or economic conditions. These estimates can have a significant impact on the undiscounted cash flows or estimated fair value of an asset and could thereby affect the value of our real estate investments on our consolidated balance sheets as well as any potential impairment losses recognized on our consolidated statements of income.

Collectability Assessments for Revenue Recognition

We evaluate on an individual lease basis whether it is probable that we will collect substantially all amounts due from our tenants and recognize changes in the collectability assessment of our operating leases as adjustments to rental revenue. Management exercises judgment in assessing collectability of tenant receivables and considers payment history, current credit status, publicly available information about the financial condition of the tenant, and other factors. Our assessment of the collectability of tenant receivables can have a significant impact on the rental revenue recognized in our consolidated statements of income.

Recent Accounting Pronouncements

See Note 2 – Basis of Presentation and Significant Accounting Policies to our consolidated financial statements in this Annual Report on Form 10-K for a discussion concerning recent accounting pronouncements.

42

NOI At Share by Segment for the Years Ended December 31, 2024 and 2023

NOI at share represents total revenues less operating expenses including our share of partially owned entities. NOI at share - cash basis represents NOI at share adjusted to exclude straight-line rental income and expense, amortization of acquired below and above market leases, accruals for ground rent resets yet to be determined, and other non-cash adjustments. We consider NOI at share to be the primary non-GAAP financial measure for making decisions and assessing the unlevered performance of our segments as it relates to the return on assets as opposed to the levered return on equity. As properties are bought and sold based on NOI at share - cash basis, we utilize this measure to make investment decisions as well as to compare the performance of our assets to that of our peers. NOI at share and NOI at share - cash basis should not be considered alternatives to net income or cash flow from operations and may not be comparable to similarly titled measures employed by other companies.

Below is a summary of NOI at share and NOI at share - cash basis by segment for the years ended December 31, 2024 and 2023.

[[GREPCENT_TABLE]]
[["(Amounts in thousands)","For the Year Ended December 31, 2024"],["","Total","","New York","","Other"],["Total revenues","$","1,787,686","","","$","1,471,997","","","$","315,689"],["Operating expenses","(927,796)","","","(766,347)","","","(161,449)"],["NOI - consolidated","859,890","","","705,650","","","154,240"],["Deduct: NOI attributable to noncontrolling interests in consolidated subsidiaries","(39,367)","","","(12,899)","","","(26,468)"],["Add: NOI from partially owned entities","279,229","","","269,159","","","10,070"],["NOI at share","1,099,752","","","961,910","","","137,842"],["Non-cash adjustments for straight-line rents, amortization of acquired below-market leases, net and other","(3,663)","","","(17,888)","","","14,225"],["NOI at share - cash basis","$","1,096,089","","","$","944,022","","","$","152,067"]]
[[/GREPCENT_TABLE]]

[[GREPCENT_TABLE]]
[["(Amounts in thousands)","For the Year Ended December 31, 2023"],["","Total","","New York","","Other"],["Total revenues","$","1,811,163","","","$","1,452,158","","","$","359,005"],["Operating expenses","(905,158)","","","(733,478)","","","(171,680)"],["NOI - consolidated","906,005","","","718,680","","","187,325"],["Deduct: NOI attributable to noncontrolling interests in consolidated subsidiaries","(48,553)","","","(15,547)","","","(33,006)"],["Add: NOI from partially owned entities","285,761","","","274,436","","","11,325"],["NOI at share","1,143,213","","","977,569","","","165,644"],["Non-cash adjustments for straight-line rents, amortization of acquired below-market leases, net and other","(3,377)","","","(7,700)","","","4,323"],["NOI at share - cash basis","$","1,139,836","","","$","969,869","","","$","169,967"]]
[[/GREPCENT_TABLE]]

43

NOI At Share by Segment for the Years Ended December 31, 2024 and 2023 - continued

The elements of our New York and Other NOI at share for the years ended December 31, 2024 and 2023 are summarized below.

[[GREPCENT_TABLE]]
[["(Amounts in thousands)","For the Year Ended December 31,"],["","2024","","2023"],["New York:"],["Office","$","706,592","","","$","727,000"],["Retail","191,379","","","188,561"],["Residential","24,044","","","21,910"],["Alexander's","39,895","","","40,098"],["Total New York","961,910","","","977,569"],["Other:"],["THE MART(1)","51,686","","","61,519"],["555 California Street(2)","64,963","","","82,965"],["Other investments","21,193","","","21,160"],["Total Other","137,842","","","165,644"],["NOI at share","$","1,099,752","","","$","1,143,213"]]
[[/GREPCENT_TABLE]]

________________________________________

See notes below.

The elements of our New York and Other NOI at share - cash basis for the years ended December 31, 2024 and 2023 are summarized below.

[[GREPCENT_TABLE]]
[["(Amounts in thousands)","For the Year Ended December 31,"],["","2024","","2023"],["New York:"],["Office","$","698,138","","","$","726,914"],["Retail","176,798","","","180,932"],["Residential","22,914","","","20,588"],["Alexander's","46,172","","","41,435"],["Total New York","944,022","","","969,869"],["Other:"],["THE MART","57,235","","","62,579"],["555 California Street(2)","74,621","","","85,819"],["Other investments","20,211","","","21,569"],["Total Other","152,067","","","169,967"],["NOI at share - cash basis","$","1,096,089","","","$","1,139,836"]]
[[/GREPCENT_TABLE]]

________________________________________

(1)2024 includes a $4,560 write-off of a receivable arising from the straight-lining of rents due to the tenant being deemed uncollectible.

(2)2023 includes our $14,103 share of the receipt of a tenant settlement, net of legal expenses.

44

NOI At Share by Segment for the Years Ended December 31, 2024 and 2023 - continued

Reconciliation of Net Income to NOI At Share and NOI At Share - Cash Basis for the Years Ended December 31, 2024 and 2023

Below is a reconciliation of net income to NOI at share and NOI at share - cash basis for the years ended December 31, 2024 and 2023.

[[GREPCENT_TABLE]]
[["(Amounts in thousands)","For the Year Ended December 31,"],["","2024","","2023"],["Net income","$","20,116","","","$","32,888"],["Depreciation and amortization expense","447,500","","","434,273"],["General and administrative expense","148,520","","","162,883"],["Transaction related costs, impairment losses and other","5,242","","","50,691"],["Income from partially owned entities","(112,464)","","","(38,689)"],["Interest and other investment income, net","(45,974)","","","(43,287)"],["Interest and debt expense","390,269","","","349,223"],["Net gains on disposition of wholly owned and partially owned assets","(16,048)","","","(71,199)"],["Income tax expense","22,729","","","29,222"],["NOI from partially owned entities","279,229","","","285,761"],["NOI attributable to noncontrolling interests in consolidated subsidiaries","(39,367)","","","(48,553)"],["NOI at share","1,099,752","","","1,143,213"],["Non-cash adjustments for straight-line rents, amortization of acquired below-market leases, net, and other","(3,663)","","","(3,377)"],["NOI at share - cash basis","$","1,096,089","","","$","1,139,836"]]
[[/GREPCENT_TABLE]]

NOI At Share by Region(1)

[[GREPCENT_TABLE]]
[["","For the Year Ended December 31,"],["","2024","","2023"],["Region:"],["New York metropolitan area","89","%","","88","%"],["Chicago, IL","5","%","","6","%"],["San Francisco, CA(1)","6","%","","6","%"],["","100","%","","100","%"]]
[[/GREPCENT_TABLE]]
________________________________________

(1) 2023 excludes our $14,103,000 share of the receipt of a tenant settlement, net of legal expenses.

45

Results of Operations – Year Ended December 31, 2024 Compared to December 31, 2023

Revenues

Our revenues were $1,787,686,000 for the year ended December 31, 2024 compared to $1,811,163,000 in the prior year, a decrease of $23,477,000. Below are the details of the (decrease) increase by segment:

[[GREPCENT_TABLE]]
[["(Amounts in thousands)"],["Increase (decrease) due to:","Total","","New York","","Other"],["Rental revenues:"],["Acquisitions, dispositions and other","$","9,214","","","$","9,038","","","$","176"],["Development and redevelopment","22,763","","","22,763","","","\u2014"],["Trade shows","760","","","\u2014","","","760"],["Same store operations","(71,417)","","","(41,192)","","","(30,225)","","(1)"],["","(38,680)","","","(9,391)","","","(29,289)"],["Fee and other income:"],["BMS cleaning fees","7,288","","","8,295","","","(1,007)"],["Management and leasing fees","1,640","","","1,824","","","(184)"],["Other income","6,275","","","19,111","","","(12,836)"],["","15,203","","","29,230","","","(14,027)"],["Total (decrease) increase in revenues","$","(23,477)","","","$","19,839","","","$","(43,316)"]]
[[/GREPCENT_TABLE]]

________________________________________

See notes below.

Expenses

Our expenses were $1,541,696,000 for the year ended December 31, 2024 compared to $1,565,167,000 in the prior year, a decrease of $23,471,000. Below are the details of the decrease by segment:

[[GREPCENT_TABLE]]
[["(Amounts in thousands)"],["Increase (decrease) due to:","Total","","New York","","Other"],["Operating:"],["Acquisitions, dispositions and other","$","10,319","","","$","11,863","","","$","(1,544)"],["Development and redevelopment","5,033","","","5,033","","","\u2014"],["Non-reimbursable expenses","(2,394)","","","(2,394)","","","\u2014"],["Trade shows","(19)","","","\u2014","","","(19)"],["BMS expenses","3,688","","","4,695","","","(1,007)"],["Same store operations","6,011","","","13,672","","","(7,661)"],["","22,638","","","32,869","","","(10,231)"],["Depreciation and amortization:"],["Acquisitions, dispositions and other","(2,460)","","","(2,460)","","","\u2014"],["Development and redevelopment","3,643","","","3,643","","","\u2014"],["Same store operations","12,044","","","9,537","","","2,507"],["","13,227","","","10,720","","","2,507"],["General and administrative","(14,363)","","","279","","","(14,642)","","(2)"],["Expense from deferred compensation plan liability","476","","","\u2014","","","476"],["Transaction related costs, impairment losses and other","(45,449)","","","(44,783)","","(3)","(666)"],["Total decrease in expenses","$","(23,471)","","","$","(915)","","","$","(22,556)"]]
[[/GREPCENT_TABLE]]

________________________________________

(1)2023 includes the receipt of a $21,350 tenant settlement, of which $6,405 is attributable to noncontrolling interests.

(2)Primarily due to the acceleration of non-cash expense on equity compensation grants for retirement eligible employees in 2023.

(3)2023 includes non-cash impairment losses of $45,007.

46

Results of Operations – Year Ended December 31, 2024 Compared to December 31, 2023 - continued

Income from Partially Owned Entities

Below are the components of income from partially owned entities.

[[GREPCENT_TABLE]]
[["(Amounts in thousands)","Percentage Ownership as of December 31, 2024","","For the Year Ended December 31,"],["","","2024","","2023"],["Our share of net income (loss):"],["Fifth Avenue and Times Square JV:"],["Equity in net income(1)","51.5%","","$","43,451","","","$","35,209"],["Return on preferred equity, net of our share of the expense","","","40,668","","","37,416"],["","","","84,119","","","72,625"],["Partially owned office buildings(2)(3)(4)","Various","","(839)","","","(73,589)"],["Alexander's Inc.(5)","32.4%","","19,076","","","37,075"],["Other equity method investments(3)(6)","Various","","10,108","","","2,578"],["","","","$","112,464","","","$","38,689"]]
[[/GREPCENT_TABLE]]

________________________________________

(1)2023 includes a $5,120 accrual of default interest which was forgiven by the lender as part of the restructuring of the 697-703 Fifth Avenue loan and is being amortized over the remaining term of the restructured loan, reducing future interest expense.

(2)Includes interests in 280 Park Avenue, 7 West 34th Street, 512 West 22nd Street, 61 Ninth Avenue, 85 Tenth Avenue and others.

(3)In 2023, we recognized $50,458 of impairment losses.

(4)2024 includes our $31,215 share of the debt extinguishment gain from the repayment of the 280 Park Avenue mezzanine loan.

(5)2023 includes our $16,396 share of the net gain from the sale of Alexander’s Rego III land parcel.

(6)Includes interests in Independence Plaza, Rosslyn Plaza and others.

Interest and Other Investment Income, net

The following table sets forth the details of interest and other investment income, net.

[[GREPCENT_TABLE]]
[["(Amounts in thousands)","For the Year Ended December 31,"],["","2024","","2023"],["Interest on cash and cash equivalents and restricted cash","$","42,571","","","$","44,786"],["Interest on loans receivable","3,450","","","1,351"],["(Loss) income from real estate fund investments","(47)","","","1,590"],["Credit losses on investments","\u2014","","","(8,269)"],["Amortization of discount on investments in U.S. Treasury bills","\u2014","","","3,829"],["","$","45,974","","","$","43,287"]]
[[/GREPCENT_TABLE]]

47

Results of Operations – Year Ended December 31, 2024 Compared to December 31, 2023 - continued

Interest and Debt Expense

Interest and debt expense was $390,269,000 for the year ended December 31, 2024, compared to $349,223,000 in the prior year, an increase of $41,046,000. This was primarily due to (i) $30,756,000 of higher amortization of interest rate cap premiums and (ii) $19,568,000 of higher interest expense resulting from higher average interest rates, inclusive of the impact of our interest rate hedging instruments, partially offset by (iii) $8,150,000 of higher capitalized interest.

Net Gains on Disposition of Wholly Owned and Partially Owned Assets

Net gains on disposition of wholly owned and partially owned assets of $16,048,000 for the year ended December 31, 2024, consists of (i) $15,175,000 from the sale of two condominium units at 220 CPS and (ii) $873,000 from the sale of our 49.9% interest in 50-70 West 93rd Street to our joint venture partner. Net gains on disposition of wholly owned and partially owned assets of $71,199,000 for the year ended December 31, 2023, primarily consists of (i) $35,968,000 upon contribution of our Pier 94 leasehold to Sunset Pier 94 Joint Venture (“Pier 94 JV”) primarily due to the step-up of our retained investment in the leasehold interest to fair value, (ii) $20,181,000 from the sale of The Armory Show, and (iii) $14,127,000 from the sale of two condominium units at 220 CPS.

Income Tax Expense

Income tax expense was $22,729,000 for the year ended December 31, 2024, compared to $29,222,000 in the prior year, a decrease of $6,493,000. This was primarily due to lower income tax expense incurred by our taxable REIT subsidiaries.

Net Loss Attributable to Noncontrolling Interests in Consolidated Subsidiaries

Net loss attributable to noncontrolling interests in consolidated subsidiaries was $51,131,000 for the year ended December 31, 2024, compared to $75,967,000 in the prior year, a decrease of $24,836,000. This resulted primarily from the allocation of the impairment loss recognized on 606 Broadway during 2023.

Same Store Net Operating Income At Share

Same store NOI at share represents NOI at share from operations which are in service in both the current and prior year reporting periods. Same store NOI at share - cash basis is same store NOI at share adjusted to exclude straight-line rental income and expense, amortization of acquired below and above market leases, accruals for ground rent resets yet to be determined, and other non-cash adjustments. We use these non-GAAP measures to (i) facilitate meaningful comparisons of the operational performance of our properties and segments, (ii) make decisions on whether to buy, sell or refinance properties, and (iii) compare the performance of our properties and segments to those of our peers. Same store NOI at share and same store NOI at share - cash basis should not be considered alternatives to net income or cash flow from operations and may not be comparable to similarly titled measures employed by other companies.

Below are reconciliations of NOI at share to same store NOI at share for our New York segment, THE MART, 555 California Street and other investments for the year ended December 31, 2024 compared to December 31, 2023.

[[GREPCENT_TABLE]]
[["(Amounts in thousands)","Total","","New York","","THE MART","","555 California Street","","Other"],["NOI at share for the year ended December 31, 2024","$","1,099,752","","","$","961,910","","","$","51,686","","","$","64,963","","","$","21,193"],["Less NOI at share from:"],["Dispositions","(1,499)","","","(1,509)","","","10","","","\u2014","","","\u2014"],["Development properties","(35,182)","","","(35,182)","","","\u2014","","","\u2014","","","\u2014"],["Other non-same store income, net","(34,735)","","","(13,416)","","","\u2014","","","(126)","","","(21,193)"],["Same store NOI at share for the year ended December 31, 2024","$","1,028,336","","","$","911,803","","","$","51,696","","","$","64,837","","","$","\u2014"],["NOI at share for the year ended December 31, 2023","$","1,143,213","","","$","977,569","","","$","61,519","","","$","82,965","","","$","21,160"],["Less NOI at share from:"],["Dispositions","(2,321)","","","(3,677)","","","1,356","","","\u2014","","","\u2014"],["Development properties","(16,310)","","","(16,310)","","","\u2014","","","\u2014","","","\u2014"],["Other non-same store income, net","(21,589)","","","(429)","","","\u2014","","","\u2014","","","(21,160)"],["Same store NOI at share for the year ended December 31, 2023","$","1,102,993","","","$","957,153","","","$","62,875","","","$","82,965","","","$","\u2014"],["Decrease in same store NOI at share","$","(74,657)","","","$","(45,350)","","","$","(11,179)","","","$","(18,128)","","","$","\u2014"],["% decrease in same store NOI at share","(6.8)","%","","(4.7)","%","","(17.8)","%","","(21.9)","%","","\u2014","%"]]
[[/GREPCENT_TABLE]]

48

Results of Operations – Year Ended December 31, 2024 Compared to December 31, 2023 - continued

Same Store Net Operating Income At Share - continued

Below are reconciliations of NOI at share - cash basis to same store NOI at share - cash basis for our New York segment, THE MART, 555 California Street and other investments for the year ended December 31, 2024 compared to December 31, 2023.

[[GREPCENT_TABLE]]
[["(Amounts in thousands)","Total","","New York","","THE MART","","555 California Street","","Other"],["NOI at share - cash basis for the year ended December 31, 2024","$","1,096,089","","","$","944,022","","","$","57,235","","","$","74,621","","","$","20,211"],["Less NOI at share - cash basis from:"],["Dispositions","(1,499)","","","(1,509)","","","10","","","\u2014","","","\u2014"],["Development properties","(21,561)","","","(21,561)","","","\u2014","","","\u2014","","","\u2014"],["Other non-same store income, net","(31,681)","","","(11,327)","","","\u2014","","","(143)","","","(20,211)"],["Same store NOI at share - cash basis for the year ended December 31, 2024","$","1,041,348","","","$","909,625","","","$","57,245","","","$","74,478","","","$","\u2014"],["NOI at share - cash basis for the year ended December 31, 2023","$","1,139,836","","","$","969,869","","","$","62,579","","","$","85,819","","","$","21,569"],["Less NOI at share - cash basis from:"],["Dispositions","(2,664)","","","(4,138)","","","1,474","","","\u2014","","","\u2014"],["Development properties","(15,519)","","","(15,519)","","","\u2014","","","\u2014","","","\u2014"],["Other non-same store income, net","(30,737)","","","(9,168)","","","\u2014","","","\u2014","","","(21,569)"],["Same store NOI at share - cash basis for the year ended December 31, 2023","$","1,090,916","","","$","941,044","","","$","64,053","","","$","85,819","","","$","\u2014"],["Decrease in same store NOI at share - cash basis","$","(49,568)","","","$","(31,419)","","","$","(6,808)","","","$","(11,341)","","","$","\u2014"],["% decrease in same store NOI at share - cash basis","(4.5)","%","","(3.3)","%","","(10.6)","%","","(13.2)","%","","\u2014","%"]]
[[/GREPCENT_TABLE]]

Related Party Transactions

See Note 21 - Related Party Transactions to our consolidated financial statements in this Annual Report on Form 10-K for a discussion concerning related party transactions.

49

Liquidity and Capital Resources

Our cash requirements include property operating expenses, capital improvements, tenant improvements, debt service, leasing commissions, dividends to our shareholders, distributions to unitholders of the Operating Partnership, as well as acquisition and development and redevelopment costs. The sources of liquidity to fund these cash requirements include rental revenue, which is our primary source of cash flow and is dependent upon the occupancy and rental rates of our properties; proceeds from debt financings, including mortgage loans, senior unsecured borrowings, unsecured term loans and unsecured revolving credit facilities; proceeds from the issuance of common and preferred equity; and asset sales.

As of December 31, 2024, we have $2.5 billion of liquidity comprised of $950.0 million of cash and cash equivalents and restricted cash and $1.5 billion available on our $2.2 billion revolving credit facilities. The ongoing challenges posed by fluctuations in interest rates and the effects of inflation could adversely impact our cash flow from continuing operations but we anticipate that cash flow from continuing operations over the next twelve months together with cash balances on hand will be adequate to fund our business operations, cash distributions to unitholders of the Operating Partnership, cash dividends to our shareholders, debt amortization and recurring capital expenditures. Capital requirements for development and redevelopment expenditures and acquisitions may require funding from borrowings, equity offerings and/or asset sales.

We may from time to time repurchase or retire our outstanding debt securities or repurchase or redeem our equity securities. Such purchases, if any, will depend on prevailing market conditions, liquidity requirements and other factors. The amounts involved in connection with these transactions could be material to our consolidated financial statements.

In April 2023, our Board of Trustees authorized the repurchase of up to $200,000,000 of our outstanding common shares under a share repurchase program. As of December 31, 2024, $170,857,000 remained available and authorized for repurchases.

Summary of Cash Flows

Cash and cash equivalents and restricted cash was $949,619,000 as of December 31, 2024, a $311,965,000 decrease from the balance as of December 31, 2023.

Our cash flow activities are summarized as follows:

[[GREPCENT_TABLE]]
[["(Amounts in thousands)","For the Year Ended December 31,","","(Decrease) Increase in Cash Flow"],["","2024","","2023"],["Net cash provided by operating activities","$","537,723","","","$","648,152","","","$","(110,429)"],["Net cash used in investing activities","(597,365)","","","(128,788)","","","(468,577)"],["Net cash used in financing activities","(252,323)","","","(278,937)","","","26,614"],["","$","(311,965)","","","$","240,427","","","$","(552,392)"]]
[[/GREPCENT_TABLE]]

Operating Activities

Net cash provided by operating activities primarily consists of cash inflows from rental revenues and operating distributions from our unconsolidated partially owned entities less cash outflows for property expenses, general and administrative expenses and interest expense. For the year ended December 31, 2024, net cash provided by operating activities of $537,723,000 was comprised of $594,706,000 of cash from operations, including distributions of income from partially owned entities of $142,880,000 and a net decrease of $56,983,000 in cash due to the timing of cash receipts and payments related to changes in operating assets and liabilities.

50

Liquidity and Capital Resources - continued

Summary of Cash Flows - continued

Investing Activities

Net cash flow used in investing activities is impacted by the timing and extent of our development, capital improvement, acquisition and disposition activities during the year.

The following table details the net cash used in investing activities:

[[GREPCENT_TABLE]]
[["(Amounts in thousands)","For the Year Ended December 31,","","Increase (Decrease) in Cash Flow"],["","2024","","2023"],["Development costs and construction in progress","$","(242,874)","","","$","(552,701)","","","$","309,827"],["Additions to real estate","(222,739)","","","(211,899)","","","(10,840)"],["Investments in partially owned entities","(115,357)","","","(57,297)","","","(58,060)"],["Investment in loan receivable","(50,000)","","","\u2014","","","(50,000)"],["Proceeds from sale of condominium units at 220 Central Park South","31,605","","","24,484","","","7,121"],["Proceeds from sales of real estate","2,000","","","123,519","","","(121,519)"],["Proceeds from maturities of U.S. Treasury bills","\u2014","","","468,598","","","(468,598)"],["Proceeds from repayment of participation in 150 West 34th Street mortgage loan","\u2014","","","105,000","","","(105,000)"],["Acquisitions of real estate and other","\u2014","","","(33,145)","","","33,145"],["Distributions of capital from partially owned entities","\u2014","","","18,869","","","(18,869)"],["Deconsolidation of cash and restricted cash held by a previously consolidated entity","\u2014","","","(14,216)","","","14,216"],["Net cash used in investing activities","$","(597,365)","","","$","(128,788)","","","$","(468,577)"]]
[[/GREPCENT_TABLE]]

Financing Activities

Net cash flow used in financing activities is impacted by the timing and extent of issuances of debt and equity securities, distributions paid to common shareholders and unitholders of the Operating Partnership as well as principal and other repayments associated with our outstanding debt.

The following table details the net cash used in financing activities:

[[GREPCENT_TABLE]]
[["(Amounts in thousands)","For the Year Ended December 31,","","Increase (Decrease) in Cash Flow"],["","2024","","2023"],["Dividends paid on common shares/Distributions to Vornado","$","(141,103)","","","$","(129,066)","","","$","(12,037)"],["Repayments of borrowings","(97,439)","","","(148,000)","","","50,561"],["Proceeds from borrowings","75,000","","","\u2014","","","75,000"],["Dividends paid on preferred shares/Distributions to preferred unitholders","(62,112)","","","(62,116)","","","4"],["Distributions to redeemable security holders and noncontrolling interests in consolidated subsidiaries","(18,156)","","","(38,970)","","","20,814"],["Deferred financing costs","(13,870)","","","(4,424)","","","(9,446)"],["Contributions from noncontrolling interests in consolidated subsidiaries","5,300","","","132,701","","","(127,401)"],["Repurchase of common shares/Class A units owned by Vornado","\u2014","","","(29,183)","","","29,183"],["Other financing activity, net","57","","","121","","","(64)"],["Net cash used in financing activities","$","(252,323)","","","$","(278,937)","","","$","26,614"]]
[[/GREPCENT_TABLE]]

Dividends

We anticipate that our common share dividend policy for 2025 will be to pay one common share dividend in the fourth quarter. If Vornado’s Board of Trustees were to declare a dividend consistent with our 2024 common share dividend of $0.74, the Operating Partnership would be required to distribute approximately (i) $141,000,000 of cash to Vornado for distribution to its common shareholders and (ii) $12,600,000 of cash to third party Class A unitholders. Additionally, during 2025, Vornado expects to pay approximately $62,000,000 of cash dividends on preferred shares based on the number of preferred shares outstanding as of December 31, 2024.

51

Liquidity and Capital Resources - continued

Debt

We have an effective shelf registration for the offering of our equity and debt securities that is not limited in amount due to our status as a “well-known seasoned issuer.” We have issued senior unsecured notes from a shelf registration statement that contain financial covenants that restrict our ability to incur debt, and that require us to maintain a level of unencumbered assets based on the level of our secured debt. Our unsecured revolving credit facilities and unsecured term loan contain financial covenants that require us to maintain minimum interest coverage and maximum debt to market capitalization ratios, and provide for increased interest rates in the event of a decline in the credit rating assigned to our senior unsecured notes. Our unsecured revolving credit facilities and unsecured term loan also contain customary conditions precedent to borrowing, including representations and warranties, and contain customary events of default that could give rise to accelerated repayment, including such items as failure to pay interest or principal. As of December 31, 2024, we were in compliance with all of the financial covenants required by our senior unsecured notes, our unsecured revolving credit facilities and our unsecured term loan.

A summary of our consolidated debt as of December 31, 2024 is presented below.

[[GREPCENT_TABLE]]
[["(Amounts in thousands)","As of December 31, 2024"],["Consolidated debt:","Balance","","WeightedAverageInterest Rate(1)"],["Fixed rate(2)","$","7,066,400","","","4.28%"],["Variable rate(3)","1,215,776","","","5.80%(4)"],["Total","8,282,176","","","4.50%"],["Deferred financing costs, net and other","(39,300)"],["Total, net","$","8,242,876"]]
[[/GREPCENT_TABLE]]

_______________________________________

(1)Represents the interest rate in effect as of period end based on the appropriate reference rate as of the contractual reset date plus contractual spread, adjusted for hedging instruments, as applicable.

(2)Includes variable rate debt with interest rates fixed by interest rate swap arrangements and the $950,000 1290 Avenue of the Americas mortgage loan which is subject to a 1.00% SOFR interest rate cap arrangement.

(3)Includes variable rate mortgages subject to interest rate cap arrangements, except for the 1290 Avenue of the Americas mortgage loan discussed above. As of December 31, 2024, $960,000 of our variable rate debt was subject to interest rate cap arrangements. The interest rate cap arrangements have a weighted average strike rate of 4.79% and a weighted average remaining term of four months.

(4)Excludes additional 3.00% default interest on the 606 Broadway mortgage loan.

During 2025 and 2026, $1,328,057,000 and $925,000,000, respectively, of our outstanding consolidated debt matures, assuming the exercise of as-of-right extension options. These amounts exclude the $74,119,000 606 Broadway mortgage loan which is in maturity default. We may refinance this maturing debt as it comes due or choose to repay it using cash and cash equivalents or our unsecured revolving credit facilities. We may also refinance or prepay other outstanding debt depending on prevailing market conditions, liquidity requirements and other factors. The amounts involved in connection with these transactions could be material to our consolidated financial statements.

Details of 2024 financing activities are provided in the “Overview” of Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The contractual principal and interest repayments schedule of our consolidated debt as of December 31, 2024 is presented below. The below excludes the $74,119,000 606 Broadway mortgage loan which is in maturity default. See page 93 for details.

[[GREPCENT_TABLE]]
[["(Amounts in thousands)","Total","","Less than 1 Year","","1 \u2013 3 Years","","3 \u2013 5 Years","","Thereafter"],["Notes and mortgages payable","$","6,416,368","","","$","1,147,623","","","$","2,508,038","","","$","2,396,325","","","$","364,382"],["Senior unsecured notes due 2025(1)","450,613","","","450,613","","","\u2014","","","\u2014","","","\u2014"],["Senior unsecured notes due 2026","412,207","","","8,600","","","403,607","","","\u2014","","","\u2014"],["Senior unsecured notes due 2031","426,391","","","11,900","","","23,800","","","23,800","","","366,891"],["Unsecured term loan","914,389","","","37,700","","","876,689","","","\u2014","","","\u2014"],["Revolving credit facilities","642,648","","","22,597","","","620,051","","","\u2014","","","\u2014"],["Total contractual principal(2) and interest(3) repayments","$","9,262,616","","","$","1,679,033","","","$","4,432,185","","","$","2,420,125","","","$","731,273"]]
[[/GREPCENT_TABLE]]

________________________________________

(1)We repaid our $450,000 3.50% senior unsecured notes on their January 15, 2025 maturity date.

(2)Based on the contractual maturity of our loans, including as-of-right extension options, as of December 31, 2024.

(3)Estimated interest for variable rate debt based on the Term SOFR curve available as of December 31, 2024.

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Liquidity and Capital Resources - continued

Capital Expenditures

Capital expenditures consist of expenditures to maintain and improve assets, tenant improvement allowances and leasing commissions. During 2025, we expect to spend $275,000,000 of capital expenditures for our consolidated properties. We plan to fund these capital expenditures from operating cash flow, existing liquidity, and/or borrowings. Our partially owned non-consolidated subsidiaries typically fund their capital expenditures without any additional equity contribution from us.

Development and Redevelopment Projects and Opportunities

Development and redevelopment expenditures consist of all hard and soft costs associated with the development and redevelopment of a property. We plan to fund these development and redevelopment expenditures from operating cash flow, existing liquidity, and/or borrowings. See detailed discussion below for our current development and redevelopment projects.

PENN District

PENN 2

We are redeveloping PENN 2, a 1,795,000 square foot (as expanded) office building, located on the west side of Seventh Avenue between 31st and 33rd Street. The development cost of this project is estimated to be $750,000,000, of which $697,451,000 of cash has been expended as of December 31, 2024.

We are also making districtwide improvements within the PENN District. The development cost of these improvements is estimated to be $100,000,000, of which $70,919,000 of cash has been expended as of December 31, 2024.

Sunset Pier 94 Studios

On August 28, 2023, we, together with Hudson Pacific Properties and Blackstone Inc., formed a joint venture to develop a 266,000 square foot purpose-built studio campus in Manhattan. We own a 49.9% equity interest in the joint venture. The development cost of the project is estimated to be $350,000,000, which will be funded with $183,200,000 of construction financing ($29,782,000 drawn as of December 31, 2024) and $166,800,000 of equity contributions. Our share of equity contributions was funded by (i) our $40,000,000 Pier 94 leasehold interest contribution and (ii) $34,000,000 of cash contributions, which are net of an estimated $9,000,000 for our share of development fees and reimbursement for overhead costs incurred by us. As of December 31, 2024, we have fully funded our share of equity and cash contributions.

350 Park Avenue

On January 24, 2023, we and the Rudin family (“Rudin”) completed agreements with Citadel Enterprise Americas LLC (“Citadel”) and with an affiliate of Kenneth C. Griffin, Citadel’s Founder and CEO (“KG”), for a series of transactions relating to 350 Park Avenue and 40 East 52nd Street. In connection therewith, we entered into a joint venture with Rudin (the “Vornado/Rudin JV”) that purchased 39 East 51st Street for $40,000,000, funded on a 50/50 basis by Vornado and Rudin. 39 East 51st Street will be combined with 350 Park Avenue and 40 East 52nd Street to create a premier development site (the “350 Park Site”). From October 2024 to June 2030, an affiliate of KG has the option to either (i) acquire a 60% interest in a joint venture with the Vornado/Rudin JV (with Vornado having an effective 36% interest in the entity) to build a new 1,700,000 square foot office tower, valuing the 350 Park Site at $1.2 billion or (ii) purchase the 350 Park Site for $1.4 billion ($1.085 billion to Vornado). From October 2024 to September 2030, the Vornado/Rudin JV has the option to put the 350 Park Site to KG for $1.2 billion ($900,000,000 to Vornado).

We are also evaluating other development and redevelopment opportunities at certain of our properties in Manhattan including, in particular, the PENN District.

There can be no assurance that the above projects will be completed, completed on schedule or within budget.

53

Liquidity and Capital Resources - continued

Other Obligations

We have contractual cash obligations for certain properties that are subject to long-term ground and building leases. During 2025, $58,522,000 of lease payments are due, including fair market rent resets accounted for as variable rent and excluding prior period accruals for ground rent resets yet to be determined. For 2026 and thereafter, we have $2,367,881,000 of future lease payments. We believe that our operating cash flow will be adequate to fund these lease payments.

Our future lease payments disclosed above include payments for our PENN 1 ground lease based on an amount estimated in January 2022, when we exercised the second of three 25-year renewal options. The first renewal period commenced June 2023 and, together with the second option exercise, extends the lease term through June 2073. The ground lease is subject to fair market value resets at each 25-year renewal period. The rent reset process for the June 2023 renewal period is currently ongoing and the timing is uncertain. The final fair market value determination may be materially higher or lower than our January 2022 estimate.

Insurance

For our properties, we maintain general liability insurance with limits of $300,000,000 per occurrence and per property, of which $275,000,000, includes communicable disease coverage, and we maintain all risk property and rental value insurance with limits of $2.0 billion per occurrence, with sub-limits for certain perils such as flood and earthquake, excluding communicable disease coverage. Our California properties have earthquake insurance with coverage of $350,000,000 per occurrence and in the aggregate, subject to a deductible in the amount of 5% of the value of the affected property. We maintain coverage for certified terrorism acts with limits of $6.0 billion per occurrence and in the aggregate (as listed below), $1.2 billion for non-certified acts of terrorism, and $5.0 billion per occurrence and in the aggregate for terrorism involving nuclear, biological, chemical and radiological (“NBCR”) terrorism events, as defined by the Terrorism Risk Insurance Act of 2002, as amended to date and which has been extended through December 2027.

Penn Plaza Insurance Company, LLC (“PPIC”), our wholly owned consolidated subsidiary, acts as a re-insurer with respect to a portion of all risk property and rental value insurance and a portion of our earthquake insurance coverage, and as a direct insurer for coverage for acts of terrorism including NBCR acts. Coverage for acts of terrorism (excluding NBCR acts) is fully reinsured by third party insurance companies and the Federal government with no exposure to PPIC. For NBCR acts, PPIC is responsible for a deductible of $2,396,808 and 20% of the balance of a covered loss and the Federal government is responsible for the remaining portion of a covered loss. We are ultimately responsible for any loss incurred by PPIC.

Certain condominiums in which we own an interest (including the Farley Condominiums) maintain insurance policies with different per occurrence and aggregate limits than our policies described above.

We continue to monitor the state of the insurance market and the scope and costs of coverage for acts of terrorism and other events. However, we cannot anticipate what coverage will be available on commercially reasonable terms in the future. We are responsible for uninsured losses and for deductibles and losses in excess of our insurance coverage, which could be material.

Our debt instruments, consisting of mortgage loans secured by our properties, senior unsecured notes and revolving credit agreements contain customary covenants requiring us to maintain insurance. Although we believe that we have adequate insurance coverage for purposes of these agreements, we may not be able to obtain an equivalent amount of coverage at reasonable costs in the future. Further, if lenders insist on greater coverage than we are able to obtain it could adversely affect our ability to finance or refinance our properties and expand our portfolio.

Other Commitments and Contingencies

We are from time to time involved in legal actions arising in the ordinary course of business. In our opinion, after consultation with legal counsel, the outcome of such matters is not currently expected to have a material adverse effect on our financial position, results of operations or cash flows.

Each of our properties has been subjected to varying degrees of environmental assessment at various times. The environmental assessments did not reveal any material environmental contamination. However, there can be no assurance that the identification of new areas of contamination, changes in the extent or known scope of contamination, the discovery of additional sites, or changes in cleanup requirements would not result in significant costs to us. 

54

Liquidity and Capital Resources - continued

Other Commitments and Contingencies - continued

We may, from time to time, enter into guarantees including, but not limited to, payment guarantees to lenders of unconsolidated joint ventures for tax purposes, completion guarantees for development and redevelopment projects, and guarantees to fund leasing costs. These agreements terminate either upon the satisfaction of specified obligations or repayment of the underlying loans. As of December 31, 2024, the aggregate dollar amount of these guarantees is approximately $516,872,000, including the payment guarantee for the mortgage loan secured by 7 West 34th Street. Other than these loans, our mortgage loans are non-recourse to us.

As of December 31, 2024, $57,643,000 of letters of credit were outstanding under our unsecured revolving credit facilities. Our unsecured revolving credit facilities contain financial covenants that require us to maintain minimum interest coverage and maximum debt to market capitalization ratios, and provide for increased interest rates in the event of a decline in the credit rating assigned to our senior unsecured notes. Our unsecured revolving credit facilities also contain customary conditions precedent to borrowing, including representations and warranties, and also contain customary events of default that could give rise to accelerated repayment, including such items as failure to pay interest or principal.

Our 95% consolidated joint venture (5% is owned by Related Companies ("Related")) developed and owns the Farley Building. In connection with the development of the property, the joint venture admitted a historic Tax Credit Investor partner. Under the terms of the historic tax credit arrangement, the joint venture is required to comply with various laws, regulations, and contractual provisions. Non-compliance with applicable requirements could result in projected tax benefits not being realized and, therefore, may require a refund or reduction of the Tax Credit Investor’s capital contributions. As of December 31, 2024, the Tax Credit Investor has made $208,407,000 in capital contributions. Vornado and Related have guaranteed certain of the joint venture’s obligations to the Tax Credit Investor.

As of December 31, 2024, we had construction commitments aggregating approximately $61,016,000.

55

Funds From Operations

Vornado Realty Trust

FFO is computed in accordance with the definition adopted by the Board of Governors of the National Association of Real Estate Investment Trusts (“NAREIT”). NAREIT defines FFO as GAAP net income or loss adjusted to exclude net gains from sales of certain real estate assets, impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity, depreciation and amortization expense from real estate assets and other specified items, including the pro rata share of such adjustments of unconsolidated subsidiaries. FFO and FFO per diluted share are non-GAAP financial measures used by management, investors and analysts to facilitate meaningful comparisons of operating performance between periods and among our peers because it excludes the effect of real estate depreciation and amortization and net gains on sales, which are based on historical costs and implicitly assume that the value of real estate diminishes predictably over time, rather than fluctuating based on existing market conditions. FFO does not represent cash generated from operating activities and is not necessarily indicative of cash available to fund cash requirements and should not be considered as an alternative to net income as a performance measure or cash flow as a liquidity measure. FFO may not be comparable to similarly titled measures employed by other companies. The calculations of both the numerator and denominator used in the computation of income per share are disclosed in Note 12 – Income (Loss) Per Share and Per Class A Unit, in our consolidated financial statements in Part II, Item 8 of this Annual Report on Form 10-K. Details of certain items that impact FFO are discussed in the financial results summary of our “Overview.”

Below is a reconciliation of net income attributable to common shareholders to FFO attributable to common shareholders plus assumed conversions for the years ended December 31, 2024 and 2023.

[[GREPCENT_TABLE]]
[["(Amounts in thousands, except per share amounts)","For the Year Ended December 31,"],["","2024","","2023"],["Reconciliation of net income attributable to common shareholders to FFO attributable to common shareholders plus assumed conversions:"],["Net income attributable to common shareholders","$","8,275","","","$","43,378"],["Per diluted share","$","0.04","","","$","0.23"],["FFO adjustments:"],["Depreciation and amortization of real property","$","399,694","","","$","385,608"],["Net gains on sale of real estate","(873)","","","(53,305)"],["Real estate impairment losses","\u2014","","","22,831"],["Our share of partially owned entities:"],["Depreciation and amortization of real property","101,195","","","108,088"],["Net gain on sale of real estate","\u2014","","","(16,545)"],["Real estate impairment losses","\u2014","","","50,458"],["FFO adjustments, net","500,016","","","497,135"],["Impact of assumed conversion of dilutive convertible securities","1,549","","","1,642"],["Noncontrolling interests' share of above adjustments on a dilutive basis","(39,819)","","","(38,363)"],["FFO attributable to common shareholders plus assumed conversions","$","470,021","","","$","503,792"],["Per diluted share","$","2.37","","","$","2.59"],["Reconciliation of weighted average shares outstanding:"],["Weighted average common shares outstanding","190,539","","","191,005"],["Effect of dilutive securities:"],["Convertible securities","1,556","","","2,468"],["Share-based payment awards","6,087","","","851"],["Denominator for FFO per diluted share","198,182","","","194,324"]]
[[/GREPCENT_TABLE]]

56